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Medicare Part D Prescription Drug Coverage - Extra Help With Costs

On January 1, 2006, a new program began providing prescription drug coverage under Medicare. Now, a Medicare Part D prescription drug plan may be an even better deal for you if you are a Medicare beneficiary with limited income and resources. You may qualify for extra help that will make your low monthly premiums, deductibles and co-payments even lower. The "extra help" is sometimes referred to as the "Low Income Subsidy (LIS)".

You may already be receiving some form of government assistance that makes you automatically eligible for the Extra Help -- for example, Medicaid, a Medicare Savings Program that pays your Medicare Part B premium, or Supplemental Security Income (SSI). If so, you will automatically be able to get extra help and need not apply.

What is the extra help?

In 2009, if you have limited income and resources, you may be able to get help paying for your monthly premiums, annual deductibles and prescription co-payments under the new Medicare prescription drug program.

If you have very limited income, you will have no coverage gap, will pay no premiums or deductibles, and will have copayments for each prescription of $1.10 or $2.40 for generics and $3.20 or $6.00 for brand name drugs. People in nursing homes with both Medicare and Medicaid will pay nothing for their prescriptions.

If you have slightly higher income you will have no coverage gap, will pay a reduced monthly premium that will vary depending on your income and where you live, and a reduced deductible of $60 a year. Your copayments will be 15 percent of the cost of each prescription.

What are the income limits?

In 2008, if your annual income is below $15,600 for an individual ($21,000 for a married couple living together), you may not have to pay monthly premiums or deductibles, and you could pay $2.25 or less for your co-payments.

Even if your annual income is higher, you still may be able to get some help with your monthly premiums, annual deductibles and prescription co-payments. For example, your income may be higher and you possibly could get extra help if you or your spouse:

·          Support other family members who live with you;

·          Have earnings from work; or

·          Live in Alaska or Hawaii.

In order to be eligible for the subsidy, individuals must have incomes below 150 percent of the federal poverty level applicable to their corresponding household size. Individuals with incomes between 135 percent and 150 percent of poverty are eligible for a subsidy amount based on a sliding scale. Individuals with incomes below 135 percent are eligible for full premium subsidies if they enroll in the basic drug plan, with no annual deductibles.

What does not count as income?

Not all cash payments count as income. For example, Social Security will not count:

·          Food Stamp assistance;

·          Home energy assistance;

·          Medical case assistance;

·          Housing assistance;

·          Disaster assistance;

·          Earned Income Tax Credit (EITC) payments;

·          Victim's compensation payments;

·          Scholarships and education grants;

·          Funds held in trust by the Secretary of the Interior for an Indian Tribe and distributed per capita to members of the Tribe;

·          Certain distributions received by an Alaska Native from an Alaska Native Regional and Village Corporation;

·          Up to $2,000 per year received by an Indian that is derived from individual interests in trusts or restricted lands; and

·          Payments to members of specific Indian Tribes as provided by federal legislation.

What are the resource limits?

To qualify in 2009, your resources must be limited to $11,990 for an individual ($23,970 for a married couple living together). These resource limits can be slightly higher (an additional $1,500 per person) if you will use some of your money for burial expenses. Resources include the value of the things you own. Some examples are:

·          Real estate (other than your primary residence);

·          Bank accounts, including checking, savings and certificates of deposit;

·          Stocks;

·          Bonds, including U.S. Savings Bonds;

·          Mutual funds;

·          Individual Retirement Accounts (IRAs); or

·          Cash at home or anywhere else.

What does not count as a resource?

SSA does not count:

·          Your primary residence;

·          Your personal possessions;

·          Your vehicle(s);

·          Resources you could not easily convert to cash, such as jewelry or home furnishings;

·          Property you need for self-support, such as rental property or land you use to grow produce for home consumption;

·          Non-business property essential to your self-support;

·          Up to $1,500 (or $3,000 if you are married and living with your spouse) of the cash value of life insurance policies you hold;

·          Burial spaces;

·          Interest earned on money you plan to use for burial expenses;

·          Certain distributions received by an Alaska Native from an Alaska Native Regional and Village Corporation;

·          Land held in trust by the United States for an individual Indian or Tribe;

·          Funds held in trust by the Secretary of the Interior for an Indian Tribe and distributed per capita to members of the Tribe;

·          Certain other payments made to you that you are holding are not counted for nine months, such as:

o    Retroactive Social Security or Supplemental Security Income (SSI) payments;

o    Housing assistance;

o    Federal income tax refunds and Earned Income Tax Credit (EITC) advances;

o    Compensation you receive as a crime victim; and

o    Relocation assistance from a state or local government.

How do I apply?

If you are not getting the extra help automatically, it is easy to apply. Here's how:

·          Get an application or apply over the phone by calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778), or

·          Apply online at http://www.socialsecurity.gov/

After you apply, Social Security will review your application and send you a letter to let you know if you qualify for the extra help. You will need to enroll in a Medicare-approved prescription drug plan to get this extra help.

How can I get more information?

For more information about getting help with your prescription drug costs, call Social Security at 1-800-772-1213 (TTY 1-800-325-0778) or visit:
http://www.socialsecurity.gov/

To learn more about the Medicare prescription drug plans, call 1-800-MEDICARE (1-800-633-4227; TTY 1-877-486-2048) or visit:
http://www.medicare.gov

How can I appeal the determination?

If you want to appeal the determination Social Security made about your eligibility for help with Medicare prescription drug plan costs, you can call SSA toll-free at 1-800-772-1213 (TTY 1-800-325-0778) or you can visit the SSA website at http://www.socialsecurity.gov/ to obtain form SSA-1021, Request for Appeal of Determination for Help with Medicare Prescription Drug Plan Costs. You can mail the request to Wilkes-Barre Data Operations Center, P.O. Box 1030, Wilkes-Barre, PA 18767-1030. You also can call, write or visit your local Social Security office.

For additional information about appeals, see:
Your Right To Question The Decision On Your Application For Help With Medicare Prescription Drug Plan Costs, available online at:
http://www.ssa.gov/pubs/10144.html

Additional Information

As part of its outreach efforts to help people understand how they may qualify and apply for extra help to make Medicare Prescription Drug Coverage more affordable, SSA produced an informational video that helps explain the new program.

The video is close captioned, and may be viewed with Windows Media Player or Real Player. A complete text script of the video is also available.

To see the video, titled Informational Video for Medicare Beneficiaries - Application for Help with Medicare Prescription Drug Plan Costs, go online to:
http://www.ssa.gov/medicareoutreach2/media/public.htm

See Also

Medicare - Overview

Medicare Part D Prescription Drug Coverage - Overview

Medicare Part D Prescription Drug Coverage - Frequently Asked Questions

Medicare Part D Prescription Drug Coverage - Interaction With Other Programs

Medicare Part D Prescription Drug Coverage - Glossary

Source

http://www.ssa.gov/pubs/10129.html

http://www.ssa.gov/pubs/10115.html

http://www.ssa.gov/pubs/10013.htm

http://www.ssa.gov/pubs/10144.html

http://www.pueblo.gsa.gov/cic_text/health/extrahelp/limited.htm

http://www.cms.hhs.gov/partnerships/downloads/flowchart.pdf

http://www.socialsecurity.gov/legislation/testimony_031406.html

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