When You Can’t Afford Your Prescription Drug Costs, Apply for “Extra Help”
Rick Delaney, Chairman, TSCL
The high cost of prescription drugs has been the topic of recent Congressional hearings. The combination of high prices, and substantial beneficiary cost-sharing requirements under Medicare Part D, results in a terrible drug cost burden for many older Americans. About 16% of our 2019 Senior Survey participants report spending at least $250 per month on prescriptions, and half of that group (about 8% of those who participated in the survey), spent more than $420 per month.
The health policy journal, Health Affairs has reported on a number of studies that found the high out-of-pocket costs under current Medicare Part D can be hazardous to your health. High costs are associated with:
- Higher rates of abandonment of new drug prescriptions
- Reductions and delays in treatment following a new diagnosis or disease progression
- Delays between refills, or treatment interruptions
- Early discontinuation of treatment
Medicare has a program — known as “Extra Help” or the Part D Low Income Subsidy (LIS) that can help pay for some, or even most, prescription drug costs. Extra Help pays the Part D plan premium up to a specific benchmark amount. Drug costs for those who qualify are no more than $3.40 for each generic drug and $8.50 for each brand name drug. The program also eliminates the Part D “doughnut hole” which is also called the coverage gap. People who qualify may enroll in a Part D plan or switch plans once per calendar quarter during the first 9 months of the year. Typically Part D enrollees are locked in for a year and may only make changes during the fall Open Enrollment period. In addition, Extra Help eliminates any Part D late enrollment penalties the enrollee may have incurred in the past. Depending on income and assets, enrollees may qualify for full or partial Extra Help.
Applicants might qualify if their income and resources are low enough. (The value of a home, vehicles, personal possessions, life insurance, burial plots, and back payments from Social Security or SSI are not counted.). The following chart illustrates:
|Savings, investments, real estate other than the primary residence
|Less than $1,518 per month
|Less than $14,100
|Married living with spouse and no other dependents
|Less than $2,058
|Less than $28,150
If you or someone you know is interested in learning more about Extra Help you may apply online at: www.socialsecurity.gov/i1020. Or call Social Security at 1-800-772-1213.
“Addressing Out-of-Pocket Specialty Drug Costs in Medicare Part D: The Good, the Bad, the Ugly, and the Ignored,” Health Affairs, July 25, 2018.