Extra Help and Low-Income Subsidy — Medicare assistance programs

This article is for educational purposes only and does not constitute medical, legal, or financial advice. Every family situation is different, and you should consult with appropriate professionals about your specific circumstances.

Your parent opens a Medicare bill and the numbers make their stomach drop. The copays are too high. The prescription costs are still breaking the budget even after they've switched to generic drugs. They're thinking about skipping doses to make medications last longer. They're choosing between medications and groceries, though they'd never admit that to you directly.

Here's what many adult children don't realize: there's a federal program that can cut those copays to nearly nothing or eliminate them entirely. Your parent might qualify even if they think they make too much money. The program is called Extra Help, also known as the Low-Income Subsidy program. It's managed by Social Security, fully funded by the federal government, and it exists specifically for situations like this.

The thing that breaks my heart about Extra Help is how many people are eligible but never apply. They don't know about it. No one tells them. Their doctor's office doesn't mention it. The insurance company doesn't bring it up. So they keep paying full price for medications they could get at a fraction of the cost.

What Extra Help Actually Covers and Changes

Extra Help is a program that subsidizes two specific costs related to Medicare Part D: your parent's monthly premium and their cost-sharing amounts (copays and coinsurance). These are the two things that make prescription coverage expensive.

If your parent is approved for Extra Help, several things happen. First, Medicare pays a portion or all of their Part D premium. Depending on your parent's specific income level, this part of their payment might disappear entirely. Their premium drops from maybe thirty or forty dollars per month to zero.

Second, Extra Help reduces what your parent pays when they go to the pharmacy. Instead of a standard copay—maybe ten dollars for a generic or forty dollars for a brand name—your parent might pay one dollar for a generic and three dollars for a brand-name medication. For someone taking four or five medications, this difference is substantial. A parent who was paying one hundred fifty dollars per month in copays might pay fifteen dollars instead.

The program doesn't require your parent to change their doctor or their pharmacy. It doesn't limit which medications your parent can take. It doesn't require prior authorization for most drugs. Extra Help simply makes the medications your parent is already taking cost significantly less.

For a parent taking multiple chronic disease medications, Extra Help can save anywhere from one hundred fifty to three hundred dollars or more per month. Over a year, that's real money. That's the difference between your parent having breathing room in their budget and your parent deciding to skip medication doses.

Income and Asset Limits: Who Actually Qualifies

This is where many people make a mistake. They assume the income limits are too low. They think Extra Help is only for people living in poverty. They calculate in their head that their parent makes too much money and never apply.

The actual income limits for Extra Help are roughly one hundred fifty to two hundred percent of the federal poverty level, depending on your parent's citizenship status and family situation. For a single person in 2024, that's approximately fourteen hundred to nineteen hundred dollars per month, or seventeen thousand to twenty-three thousand dollars per year. For a married couple, it's roughly nineteen hundred to twenty-five hundred dollars per month.

These limits are more generous than you'd think. A parent with a modest Social Security income and a small pension often qualifies. A parent who worked and receives a small retirement income might qualify. A parent who never worked much but has Social Security benefits of twelve hundred dollars monthly might qualify.

Asset limits also apply, but they're not nearly as restrictive as people assume. Your parent can have up to about eight thousand dollars in liquid assets (not counting their home, car, or household items). If your parent is married, both spouses together can have up to about sixteen thousand dollars. These limits apply to savings accounts, checking accounts, and investments. They don't count retirement accounts like IRAs or 401(k)s. They don't count the home or car.

Many parents come in under these limits. Even if they have some savings, most older adults with modest incomes qualify. The only real disqualifier is having too much income. If your parent is genuinely wealthy—receiving a large pension plus Social Security plus investment income,they probably won't qualify. But most adult children helping their aging parents work through Medicare finances aren't in that situation.

Here's a practical way to think about it: if you're worried your parent might qualify, they probably do. The income limits are intentionally generous to catch the people who need help. If you're on the fence, it's worth applying anyway. The worst that happens is Social Security says no. The best that happens is your parent gets approved and suddenly their medication costs are manageable again.

The Application Process: Simpler Than You Think

One thing that stops people from applying for Extra Help is that they assume the application is complicated. They picture stacks of paperwork and forms they can't understand. They worry about making a mistake. They put it off.

The actual application for Extra Help is remarkably straightforward. Your parent has three basic options: apply through the Social Security Administration, apply through their state Medicaid agency, or apply online through Medicare.

If your parent wants to apply through Social Security in person, they go to the local Social Security office with proof of income (like a recent tax return or Social Security statement) and proof of assets (like a bank statement). A representative fills out the application together with them. The entire conversation takes about twenty minutes. It's not formal or intimidating. It's just a basic conversation about their income and savings.

If your parent prefers to apply online, they can go to Medicare.gov or Social Security's website. The online application walks through questions step by step. Your parent can save their progress and come back later if they need to. At the end, they submit it electronically and Social Security reviews it.

Some states let people apply through their Medicaid agency instead of Social Security. This option exists because some people are more comfortable working with their state government than the federal government. The process is similar: your parent provides income and asset information, and the state determines eligibility.

No matter how your parent applies, they need to provide proof of their income and proof of their assets. For income, a recent Social Security statement works fine. For assets, a bank statement showing checking and savings account balances is sufficient. Social Security doesn't need tax returns or complex financial documents. They need the basics.

The application is not means-testing in the sense of a home visit or investigation. Social Security trusts what your parent tells them, supported by these basic documents. They're trying to make this accessible to the people who need it. They're not trying to make it hard.

What Happens After Approval

Your parent applies in March. Six weeks later, Social Security sends them a notice in the mail. The notice says they've been approved for Extra Help and includes their specific subsidy amount. This notice also gets transmitted electronically to Medicare, which sends it to your parent's Part D plan.

Once the Part D plan gets the notice, they automatically adjust your parent's benefits. The next time your parent goes to the pharmacy, the copay that was supposed to be forty dollars is now three dollars. The prescription that was going to cost ninety dollars is now covered with a small copay. Your parent doesn't have to do anything else. They don't have to enroll in a different plan. They don't have to change their pharmacy. The changes just happen.

Your parent gets a new prescription drug plan card or an updated plan document that reflects the Extra Help subsidy. For practical purposes, from your parent's perspective, their medication costs just became much lower. When they pick up medications, they pay the reduced copay. When they see their bills, the copays are much smaller.

Social Security will periodically recertify your parent's eligibility, usually once a year. This is just a check to make sure your parent still qualifies,their income and assets haven't changed substantially. Your parent gets a form in the mail asking them to confirm their income and assets are still within limits. They fill it out and send it back. As long as nothing has drastically changed, they stay approved.

One important detail: if your parent's situation changes,they get a raise, they inherit money, or some other big change happens,they should report it to Social Security. But small fluctuations in Social Security benefit amounts don't matter. The program is built to account for normal variation in income.

The Mistake That Costs Thousands

Here's a scenario I see play out too often. Your parent becomes eligible for Extra Help in March. They don't know about the program and don't apply. They keep paying full copays. In September, they finally hear about Extra Help through a friend. They apply then.

Social Security approves them quickly. But here's the important thing: Extra Help is retroactive three months. If your parent applies in September, the approval covers June, July, August, and September. They get refunded or credited for the copays they overpaid from June through August.

But if they had applied in March when they actually became eligible, the benefit would have covered March, April, May, June, July, August, and September. That's six months of reduced copays instead of four. That's the difference between paying full copays for two extra months and not having to.

If your parent doesn't apply until December, the retroactivity covers September through December. That means they've paid ten months of full copays out of their own pocket even though they were eligible the whole year.

The financial impact of this mistake compounds over time. If your parent takes medications that cost a hundred dollars per month in copays under their regular Part D plan, and Extra Help would reduce that to fifteen dollars per month, they're paying an extra eighty-five dollars monthly for every month they delay applying. Over six months, that's five hundred and ten dollars. Over a year, that's over one thousand dollars.

This isn't a small oversight. This is the difference between your parent affording their medications and your parent rationing pills. The solution is simple: apply as soon as you suspect your parent might qualify. If they don't qualify, no harm done. If they do qualify, the retroactivity means they get money back or credited against future copays.

Coordination With Other Programs

If your parent qualifies for both Extra Help and Medicare Savings Programs, the programs work together. Medicare Savings Programs pay Medicare premiums and cost-sharing for certain low-income beneficiaries. Some people qualify for both. If your parent does, Social Security coordinates between the programs so your parent gets the maximum benefit from both.

Your parent's state Medicaid program might also help with costs. Some states offer Medicaid to people who just barely don't qualify for traditional Medicaid. These programs work alongside Extra Help to make healthcare costs more manageable. A Social Security representative can discuss whether your parent might qualify for other assistance programs while you're discussing Extra Help.

If your parent has a Medigap policy, Extra Help coordinates with it. If your parent is in a Medicare Advantage plan, Extra Help works with that plan's cost structure. The subsidy doesn't require your parent to switch plans or change their coverage. It just reduces what they pay.

The important thing is that Extra Help doesn't prevent your parent from accessing other benefits they might qualify for. Your parent can apply for Extra Help and separately check whether they qualify for other state or federal assistance programs. The benefits stack to provide maximum support.

The Real Impact: A Conversation That Changed Things

When I helped my own parent apply for Extra Help, I expected the paperwork to take hours. I expected to need a tax accountant to understand it. I expected that the approval would take months.

In reality, we spent forty-five minutes at the Social Security office on a Thursday afternoon. My parent brought their bank statements and Social Security benefits statement. The representative asked a few questions, filled out a form, and said, "You qualify." Six weeks later, the approval letter arrived.

My parent's next pharmacy bill was half what it had been. By the end of the year, my parent had saved over fifteen hundred dollars. My parent went from choosing between medications and paying for groceries some months to having both available without stress.

That one conversation changed my parent's financial situation. But it only happened because I learned about the program and knew my parent probably qualified. If I hadn't learned about it, my parent would still be paying full copays and worrying about affording medications.

This is why I'm sharing this information with you. Your parent might be in the same situation right now. They might qualify for Extra Help and not know it. They might have been paying more for medications for months or years than they actually need to. The solution isn't complicated or time-consuming. It's just knowing to ask.

How To Help Your Elders is an educational resource. We do not provide medical, legal, or financial advice. The information in this article is general in nature and may not apply to your specific situation. If you are concerned about a loved one's medication costs or coverage, consult with their healthcare provider, pharmacist, or contact 1-800-MEDICARE for assistance.