Good News for Medicare Beneficiaries

Although Medicare is the “public health insurance option” for people 65 and over and those with disabilities, it is not free. There are premium costs, co-insurance and deductibles associated with the different parts of Medicare and they can be a hardship for many on fixed incomes to afford.  Fortunately, there are programs that help pay these costs for people who qualify and, even better, federal changes have eased some eligibility requirements in 2010 and beyond.

Medicare Savings Programs (MSPs)

Medicare Savings Programs pay the monthly Part B premiums and one of them also pays the Part A premium (for those who don’t get it free) and the co-insurance and deductibles under both parts of Medicare. These programs are for people with low incomes and limited assets, but in 2010, the asset limits have increased. Now individuals may keep up to $6,600 in savings and a married couple up to $9,910 (up from $4,000 and $6,000 respectively). Furthermore, these amounts do not include an additional $1,500 per person that may be set aside for burial expenses. 

The three types of Medicare Savings Programs are:

To view the updated Medicare Savings Program online application, click here.

Low Income Subsidy (LIS) or Extra Help

This program assists with the costs associated with Medicare’s prescription drug coverage such as the plan premiums, deductibles, co-payments and the infamous donut hole. The Centers for Medicare and Medicaid Services estimates that many people have not applied for the LIS, even though they may be eligible. 

Currently, the application process has been simplified in the following ways:

• In-kind support and maintenance is no longer counted as income. (This is the financial help that someone may regularly receive from another person to help pay household expenses such as rent, bills, food, and property taxes.)
• The cash surrender value of life insurance policies is no longer countable under the assets limit.
• People who applied in the past and had their applications denied will now be sent a letter telling them that they may now be eligible because of these recent changes.
• The new application form no longer asks about these excluded items and is available online at http://www.socialsecurity.gov/prescriptionhelp/. People can also apply by calling Social Security at 1-800-772-1213 or by visiting a local Social Security office.

To qualify for the Low Income Subsidy, the following income and asset limits apply:

• For an individual—$1,354/month in income and $12,510 in assets
• For a married couple—$1,821/month in income and $25,010 in assets

HICAP counselors screen people for eligibility for these low income assistance programs and can also help with the application process. To seek further explanation or assistance with Medicare and associated insurance programs, contact HICAP at 1-800-434-0222.