Prescription drug costs are one of the biggest financial burdens for Medicare beneficiaries. The Extra Help program, also known as the Low-Income Subsidy (LIS), is a federal program that significantly lowers the cost of Medicare Part D prescription drug coverage for individuals with limited income and resources. Many beneficiaries who qualify never apply simply because they do not realize the program exists.
This guide explains how Extra Help works, who qualifies, the cost savings it provides, and how to apply quickly and easily.
What Is the Extra Help (LIS) Program?
Extra Help is a federal subsidy administered by the Social Security Administration. It is designed to reduce or eliminate the out-of-pocket costs associated with Medicare prescription drug coverage.
The program assists with:
- Part D monthly premiums
- Annual deductibles
- Medication copays
- Coinsurance
- Costs in the donut hole
- Catastrophic coverage costs
- Part D late enrollment penalties
Individuals who qualify can save hundreds or even thousands of dollars per year.
What Extra Help Covers
Extra Help provides two levels of assistance—full and partial. The level you receive depends on your income and resources.
Full Extra Help Benefits
Full Extra Help offers the highest level of savings, including:
- Zero or low Part D premiums
- Zero or low deductibles
- Very low fixed copays for generic and brand medications
- No coverage gap (donut hole)
- No catastrophic copays
- No Part D late-enrollment penalty
Full Extra Help provides steady and predictable drug costs throughout the year.
Partial Extra Help Benefits
Partial Extra Help provides:
- Reduced Part D premiums
- Lower deductibles
- Lower medication copays
- Reduced costs during different phases of Part D coverage
While benefits are not as extensive as full Extra Help, partial Extra Help still provides significant savings.
Who Qualifies for Extra Help?
Eligibility is based on:
- Income
- Financial resources
- Medicare enrollment status
Income Eligibility
Income limits are updated each year and vary slightly based on household size. Many individuals qualify even when their income appears too high because certain types of income do not count.
Resource Eligibility
Resources include:
- Checking accounts
- Savings accounts
- Investments
- Retirement accounts
Resources that do not count include:
- Your primary home
- One vehicle
- Personal belongings
- Household items
- Certain burial funds
Medicare Enrollment Requirement
To qualify, you must be enrolled in or eligible for:
- Medicare Part A
- Medicare Part B
- A Medicare Part D plan (or Medicare Advantage plan with drug coverage)
Automatic Qualification for Extra Help
Many Medicare beneficiaries do not realize they may already qualify for Extra Help automatically.
You are automatically enrolled in Extra Help if you:
- Are approved for QMB, SLMB, or QI
- Receive full Medicaid benefits
- Receive Supplemental Security Income (SSI)
In these cases, a separate application is not required.
How Much Can Extra Help Save?
Extra Help can drastically reduce prescription drug costs.
Typical Savings Include:
- $0 to low Part D premiums
- Up to $545 saved on deductibles
- Significantly lower copays (often just a few dollars)
- Thousands of dollars saved during the donut hole
- $0 catastrophic drug costs
Most beneficiaries save between $2,000 and $5,000 per year depending on medication needs.
How Extra Help Works With Medicare Advantage and Part D Plans
Extra Help works with:
- Stand-alone Part D plans
- Medicare Advantage plans that include drug coverage
- Dual-Eligible Special Needs Plans (D-SNPs)
For Medicare Advantage Members
Extra Help lowers the medication costs within your existing MA-PD plan.
For Stand-alone Part D Members
Extra Help lowers your Part D premium, deductible, and copays.
For D-SNP Members
Most D-SNP plans already include low prescription costs, and Extra Help often reduces them even further.
How to Apply for Extra Help
If you are not automatically enrolled, the application process is simple.
Apply Online
The quickest way is through the Social Security Administration’s website.
Apply by Phone
Social Security can take your application over the phone.
Apply by Mail
A paper application can be submitted through the mail.
Documents Usually Required
- Identification information
- Medicare claim number
- Financial resource details
- Income information
The application can be completed in just a few minutes.
When Extra Help Benefits Begin
Once approved:
- Extra Help typically begins the first month after approval
- Your Part D plan is notified automatically
- Premiums and copays are adjusted quickly
- Late-enrollment penalties (if applicable) are removed
There is no waiting period.
Common Misconceptions About Extra Help
“I don’t qualify because I have savings.”
Certain resources don’t count, and limits may be higher than expected.
“Extra Help only works with certain Medicare plans.”
Extra Help works with any Part D or MA-PD plan.
“Applying is complicated.”
The application is simple and can be done in minutes.
“I don’t qualify because I’m not on Medicaid.”
Medicaid is not required for Extra Help.
Many individuals who do not qualify for Medicaid still qualify for Extra Help through income and resource guidelines.
Who Benefits Most from Extra Help?
Extra Help is especially valuable for:
- Individuals with high prescription drug costs
- Beneficiaries with chronic conditions
- People living on fixed incomes
- Beneficiaries who fell into the donut hole
- Individuals who need multiple brand medications
- Anyone paying full Part D premiums
Prescription costs can be unpredictable; Extra Help makes them manageable.
Conclusion
The Extra Help (LIS) program is one of the most effective ways to reduce Medicare prescription drug costs quickly. By lowering premiums, deductibles, copays, and eliminating coverage gaps, Extra Help provides financial stability and ensures beneficiaries can access the medications they need.
Millions of eligible people never apply simply because they are unaware of the program or assume they do not qualify. If you take prescription medications or struggle with Part D costs, Extra Help may provide immediate financial relief.
Need Help Applying for Extra Help or Reviewing Your Part D Options?
Menke Insurance can help you determine eligibility, complete your Extra Help application, and compare Medicare drug plans to ensure you receive the maximum savings available.
Contact Menke Insurance today for free Medicare assistance and personalized support.