Medicare Savings Programs & Extra Help: Cut Your Healthcare Costs to Near Zero
If you’re on Medicare and living on a limited income, you may be leaving thousands of dollars on the table every year. Medicare Savings Programs can eliminate your Part B premiums, wipe out deductibles, and cover copays. The Extra Help program can reduce your prescription drug costs to as little as $0 per month. These programs exist specifically for people in your situation — and most people who qualify have never heard of them.
What Are These Programs?
There are two related but separate programs that can dramatically reduce what Medicare beneficiaries pay for healthcare. Understanding the difference between them is the first step:
Medicare Savings Programs (MSPs) are state-administered programs, funded jointly by federal and state governments, that help low-income Medicare enrollees pay for Medicare Part A and Part B costs — including premiums, deductibles, and copays. They are administered through your state Medicaid agency.
Extra Help (also called the Low-Income Subsidy or LIS) is a federal program administered by the Social Security Administration that helps people with limited income and resources pay for Medicare Part D prescription drug costs — including premiums, deductibles, and copays at the pharmacy.
Many people qualify for both programs simultaneously. Together, they can eliminate nearly all out-of-pocket healthcare costs for qualifying Medicare beneficiaries.
The Four Medicare Savings Programs
There are four distinct MSP tiers, each with different income limits and different levels of cost assistance. They’re named after the acronyms for their formal titles:
The most comprehensive Medicare Savings Program. QMB covers:
- Medicare Part A premium (if you have one)
- Medicare Part B premium (~$185/month in 2025)
- Part A deductible ($1,676 per benefit period in 2025)
- Part B deductible ($257 in 2025)
- All Medicare copays and coinsurance for Part A and Part B services
SLMB covers:
- Medicare Part B premium only (~$185/month)
- Does not cover deductibles or copays
Income limits are slightly higher than QMB, so people who don’t qualify for QMB may qualify for SLMB.
QI covers:
- Medicare Part B premium only (~$185/month)
- Does not cover deductibles or copays
- Unlike QMB and SLMB, funding is limited — first come, first served each year
Income limits are higher than SLMB. Applications reset each January and are approved on a first-come, first-served basis as funding allows.
QDWI covers:
- Medicare Part A premium for working disabled individuals under 65 who lost premium-free Part A after returning to work
This is a narrowly targeted program for a specific situation. If you’re under 65, have a disability, returned to work, and lost premium-free Medicare Part A as a result, you may qualify.
Income and Asset Limits for 2025
The income limits below are for the 48 contiguous states and D.C. Alaska and Hawaii have higher limits. These figures are updated annually in April.
| Program | Monthly Income Limit (Individual) | Monthly Income Limit (Married Couple) | Asset Limit (Individual) | Asset Limit (Married Couple) |
|---|---|---|---|---|
| QMB | $1,255 | $1,703 | $9,430 | $14,130 |
| SLMB | $1,478 | $1,992 | $9,430 | $14,130 |
| QI | $1,660 | $2,239 | $9,430 | $14,130 |
| QDWI | $4,615 | $6,219 | $4,000 | $6,000 |
What QMB Saves You Each Year
QMB is by far the most valuable Medicare Savings Program because it covers not just premiums but all cost-sharing. Here’s what full QMB enrollment saves the average Medicare beneficiary annually:
Beyond these predictable savings, QMB coverage of copays and coinsurance can be extremely valuable for people who use healthcare frequently. A single hospitalization involves dozens of copay moments — daily hospital copays, skilled nursing facility copays, and outpatient service coinsurance. QMB covers all of these, meaning a hospitalized QMB enrollee typically pays $0 out of pocket for their Medicare-covered care, compared to potentially thousands of dollars for a non-QMB Medicare beneficiary.
Extra Help: Prescription Drug Cost Assistance
Extra Help (also called the Low-Income Subsidy) is a separate program from MSPs, administered by the Social Security Administration, that reduces the cost of Medicare Part D prescription drug coverage. For qualifying enrollees, it can reduce what you pay for medications to near zero.
What Extra Help Covers
For most Extra Help enrollees in 2025:
- Part D premium: SSA pays the benchmark premium amount. If your plan’s premium is above the benchmark, you pay the difference — but you can switch to a plan at or below the benchmark and pay nothing.
- Part D deductible: Covered in full — you pay $0 deductible.
- Copays at the pharmacy: $1.10–$4.50 per prescription for generics, $3.30–$11.20 per prescription for brand-name drugs (exact amounts depend on your income level within Extra Help). This is dramatically lower than standard Part D cost-sharing, which can run $45+ per brand-name prescription.
- Coverage gap (the “donut hole”): Extra Help enrollees do not enter the coverage gap. Your low copays apply throughout the year regardless of how much you’ve spent on drugs.
Extra Help Income and Asset Limits for 2025
| Household Size | Monthly Income Limit | Annual Income Limit | Asset Limit |
|---|---|---|---|
| Individual | $1,903 | $22,836 | $17,220 |
| Married couple | $2,575 | $30,900 | $34,360 |
How to Apply
- Apply for Extra Help with the Social Security Administration first. You can apply online at ssa.gov/medicare, by calling 1-800-772-1213 (TTY: 1-800-325-0778), or by visiting your local Social Security office. The SSA application for Extra Help is also used to determine eligibility for MSPs — SSA will forward your application to your state Medicaid office automatically if you may qualify for an MSP.
- Apply for Medicare Savings Programs through your state Medicaid office. Even if SSA forwards your information, applying directly with your state Medicaid office ensures faster processing. Search “[your state] Medicare Savings Programs” or “[your state] Medicaid” to find your state’s application process. Many states accept online applications.
- Contact your State Health Insurance Assistance Program (SHIP). Every state has a free SHIP program staffed by trained counselors who can help you understand MSPs, Extra Help, and other Medicare cost assistance programs — at no charge. Find your local SHIP at shiphelp.org or by calling 1-877-839-2675. SHIP counselors can review your specific situation and help you apply.
- Gather documents before you apply. You’ll need: Medicare card, proof of income for all household members (Social Security award letters, pay stubs, pension statements), bank account statements and records of financial assets, and proof of any other benefits you receive. Having these ready speeds up processing significantly.
- Don’t stop at one program — apply for everything you’re eligible for. People who qualify for QMB often also qualify for Medicaid, Extra Help, SNAP, and LIHEAP. Ask your SHIP counselor or state Medicaid caseworker to review your eligibility for all available programs at once. These programs compound in value when combined.
Documents You’ll Need
- Medicare card (showing your Medicare number and parts you’re enrolled in)
- Proof of income: Social Security award letter, pension statements, bank interest statements, any other income sources
- Bank statements (savings and checking) for the past 3 months
- Records of other financial assets: stocks, bonds, IRAs, etc.
- Proof of insurance: any Medicare supplemental coverage, employer coverage, or other insurance
- Proof of identity and Medicare eligibility (usually your Medicare card is sufficient)
Common Myths — Cleared Up
“I own my home so I have too many assets to qualify.”
Your primary home is completely excluded from the asset calculation for both MSPs and Extra Help. One vehicle is also excluded. Many seniors who own their home and a car actually fall well below the asset limits once these exclusions are applied. The asset test is primarily looking at liquid assets — savings accounts, CDs, stocks, and similar holdings.
“These programs are only for people on Medicaid.”
Medicare Savings Programs and Extra Help are available to Medicare enrollees regardless of Medicaid status. Many people who qualify for MSPs do not qualify for full Medicaid — the income limits are different and higher for MSPs. If you’re on Medicare and struggling with costs, apply even if you don’t think you’d qualify for Medicaid.
“Applying for these programs will affect my Medicare benefits.”
Enrolling in MSPs or Extra Help does not reduce or change your Medicare benefits in any way. These are cost-assistance programs that pay your out-of-pocket costs — they don’t alter your coverage, restrict which providers you can see, or change what Medicare covers. Your Medicare benefits remain exactly the same; you just pay less for them.
“My income is a little over the limit, so I definitely don’t qualify.”
The income limits shown are gross limits before standard deductions are applied. The first $20 of most monthly income is excluded, earned income has additional deductions, and other income sources may be partially excluded. Many people whose gross income looks too high actually fall below the limit after these deductions. Apply — let the agency do the math. It’s free and takes about 20 minutes.
State Pharmaceutical Assistance Programs (SPAPs)
In addition to the federal MSP and Extra Help programs, many states operate their own State Pharmaceutical Assistance Programs (SPAPs) that provide additional drug cost assistance for Medicare enrollees who don’t qualify for Extra Help or who need help beyond what Extra Help covers. If you live in a state with an SPAP and don’t fully qualify for Extra Help, ask your SHIP counselor about state-level drug assistance options.
States with SPAPs include (but are not limited to): California (PACE+), Connecticut (ConnPACE), Delaware (Prescription Assistance for the Aged and Disabled), Illinois, Indiana, Maine, Maryland, Massachusetts, Michigan, Missouri, New Jersey (PAAD/Senior Gold), New York (EPIC), Pennsylvania (PACE), and Rhode Island. Programs, eligibility, and benefit levels vary significantly by state.
Frequently Asked Questions
If I qualify for QMB, do I still need a Medigap supplement plan?
For most people, QMB provides benefits comparable to or better than most Medigap supplemental insurance plans — covering premiums, deductibles, and all copays/coinsurance. The key difference: QMB is income-based and requires annual renewal, while Medigap is a private insurance policy with a monthly premium. If you qualify for QMB, there’s typically no need to pay for Medigap coverage — the QMB benefits cover the same cost-sharing gaps that Medigap is designed to fill. Consult a SHIP counselor to evaluate your specific situation.
How often do I need to renew?
Medicare Savings Programs require annual renewal through your state Medicaid office. You’ll receive a renewal notice before your coverage expires. In some states, renewal may be automatic if there are no significant changes to your income or assets. Extra Help through SSA is reviewed annually as well. Respond to all renewal notices promptly to avoid gaps in coverage.
What if I’m denied — can I appeal?
Yes. Both MSP and Extra Help denials can be appealed. For MSP denials, you have the right to a fair hearing through your state Medicaid agency — the denial notice must include appeal information. For Extra Help denials, you can request reconsideration with SSA within 60 days of the denial notice. A SHIP counselor can help you navigate an appeal at no cost.
Can I get these benefits if I’m under 65 on Medicare due to disability?
Yes. Medicare Savings Programs and Extra Help are available to all Medicare enrollees regardless of age. If you’re under 65 and enrolled in Medicare because of a disability, SSDI, or End-Stage Renal Disease (ESRD), you are fully eligible to apply for and receive MSP and Extra Help benefits. Age 65 is not a requirement.
Does receiving MSP affect my eligibility for SNAP or other programs?
Receiving a Medicare Savings Program benefit generally does not reduce your eligibility for SNAP. In many states, MSP enrollment can actually help establish or confirm Medicaid eligibility, which in turn may affect your eligibility for other programs positively. MSP benefits are not counted as income for SNAP purposes. If you’re enrolled in an MSP and not receiving SNAP, ask about your SNAP eligibility — many MSP enrollees also qualify.
