What Is Medicare Extra Help?

Christian Worstell
In this article...
  • Medicare Extra Help helps pay prescription drug costs that aren't covered by Medicare Part D. Find out who is eligible for Medicare Extra Help and how to enroll.

Medicare Part D benefits do not cover every out-of-pocket cost Medicare beneficiaries pay at the pharmacy, which can lead to potentially significant cost gaps that people on fixed or limited incomes may struggle to meet.

Medicare Extra Help (also called the Medicare Low-Income Subsidy, or LIS) is an assistance program that helps pay for the major out-of-pocket costs of prescription medications that Medicare Part D plans don’t cover. Eligibility is limited to Medicare beneficiaries who meet the Extra Help income limits, or who are enrolled in another qualifying assistance program.

If you're ready to compare Medicare prescription drug plan costs, you can find plans online or call to speak with a licensed insurance agent who can help you find a plan you can afford that covers the drugs you need.


Who Is Eligible for Extra Help?

Extra Help is available for Medicare beneficiaries with qualifying income and assets.

Some Medicare enrollees are automatically enrolled in Extra Help. Medicare beneficiaries who receive Social Security Income (SSI) benefits and Medicare beneficiaries who also have Medicaid automatically get Extra Help.

To be eligible to apply for Extra Help, beneficiaries must be enrolled in Medicare and have earned less than $20,385 in 2022 as an individual, or less than $27,465 for married couples. Countable assets must not exceed $15,510 for an individual applying alone, or $30,950 for a married couple. Income may be from any source, but countable assets refers to a limited range of personal property.

The Social Security Administration does not count certain assets toward beneficiaries’ limits.

Protected resources include:

  • A single home, if it is a primary residence
  • Personal possessions
  • A single vehicle
  • Furniture, jewelry and other items that are not easily converted into cash
  • Property that is needed for self-support, such as a rental property or land used as a personal garden
  • Life insurance policies
  • Burial expense plans and burial plots
  • Interest earned on any uncountable asset

The Social Security Administration also doesn’t count certain types of income when calculating eligibility for Extra Help. Protected types of income include:

  • Supplemental Nutrition Assistance Program (SNAP), also called Food Stamps
  • Low-income housing assistance such as Section 8
  • Home energy assistance (LIHEAP)
  • Disaster assistance
  • Tax credits such as the earned income credit
  • Personal bequests from other people that are used to pay household expenses
  • Victims’ compensation grants
  • Scholarships, grants and other educational funds

Older adults with qualifying income can submit an Extra Help application through the Social Security Administration, along with proof of eligibility, which can include an official letter stating your enrollment in a low-income assistance program.

Medicare Advantage

Medicare Extra Help Benefits

Extra Help steps in to help pay the out-of-pocket costs most Medicare Part D plans don’t cover.

Extra Help beneficiaries whose income and assets qualify them for Extra Help may have their entire monthly premium payment, full deductible and other costs paid for by the Medicare low-income subsidy program.

Enrollees who earn higher than the minimum income may be asked to pay some of their uncovered costs, but all program participants get some relief from Medicare prescription drug costs.

How Does Medicare Pay for Prescription Drugs?

Medicare is the main federal health insurance program for qualifying older adults in the United States. Medicare Part D was created in 2006 and offers prescription drug benefits, which help millions of beneficiaries pay for their medication through privately offered health insurance carriers.

Part D plans are issued by private insurance providers that set their own monthly premiums and deductibles. In 2024, the maximum annual deductible an authorized Part D plan can charge is $506. Many carriers offer plans with substantially lower deductibles, including some $0 deductible plans, though these plans may come with relatively high monthly premiums.

After the yearly deductible is met, Part D plans pay their share of enrollees’ drug costs, up to the 2024 limit of $3,250. After that, in the coverage gap, or “donut hole," benefits drop off and beneficiaries may have to pay 25% of their total medication costs for brand-name and generic drugs.

Inside the coverage gap, prescription drugs are usually available at steep discounts, up to 75% off, to help Medicare enrollees get through to the maximum annual out-of-pocket cost for Part D. This is $8,000 in 2024, after which Medicare’s catastrophic coverage stage kicks in to pay most of a beneficiary’s remaining medication costs for the remainder of the year.

Christian Worstell
About the Author

Christian Worstell is a senior Medicare and health insurance writer with HelpAdivsor.com. He is also a licensed health insurance agent. Christian is well-known in the insurance industry for the thousands of educational articles he’s written, helping Americans better understand their health insurance and Medicare coverage.

Christian’s work as a Medicare expert has appeared in several top-tier and trade news outlets including Forbes, MarketWatch, WebMD and Yahoo! Finance.

While at HelpAdvisor, Christian has written hundreds of articles that teach Medicare beneficiaries the best practices for navigating Medicare. His articles are read by thousands of older Americans each month. By better understanding their health care coverage, readers may hopefully learn how to limit their out-of-pocket Medicare spending and access quality medical care.

Christian’s passion for his role stems from his desire to make a difference in the senior community. He strongly believes that the more beneficiaries know about their Medicare coverage, the better their overall health and wellness is as a result.

A current resident of Raleigh, Christian is a graduate of Shippensburg University with a bachelor’s degree in journalism. You can find Christian’s most recent articles in our blog.

If you’re a member of the media looking to connect with Christian, please don’t hesitate to email our public relations team at Mike@MyHelpAdvisor.com.

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