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22. What is the low-income subsidy (LIS), also known as Extra Help?

The Part D benefit provides financial assistance known as Extra Help to those with limited income and assets. If you are eligible for Extra Help, your Part D premiums, deductibles and copayments can be eliminated or significantly reduced. In addition, you will not be exposed to the gap in coverage, also known as the “donut hole.” About one-third of all Medicare beneficiaries are likely to be eligible for the low-income subsidy. The Social Security Administration estimates that this Extra Help could be worth an average of $4,000 per year. The National Committee strongly encourages all seniors who think they might be eligible for Extra Help to apply for this valuable assistance with their drug expenses.

You must have limited income and assets to be eligible for Extra Help. Medicare Part D provides different levels of financial assistance based on income and asset limits. In general, you are eligible for some type of assistance if your income is less than $17,820 for an individual and $24,030 for a couple, and your assets are less than $13,640 for an individual and $27,250 for a couple, including allowed burial expenses. Generally, income such as wages, earnings from self-employment, Social Security benefits and pension payments count for the purpose of determining eligibility for Extra Help. Examples of income that does not count include income tax refunds and housing assistance. Examples of assets that count toward determining eligibility for Extra Help include stocks, bonds and savings bonds. The home you live in and the land it is on, family heirlooms, wedding or engagement rings and life insurance policies do not count as assets.

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