Glossary of programs that help pay Medicare costs for people with limited incomes

Overview of cost-saving programs

Numerous programs may help reduce your health care and prescription drug costs if you meet the eligibility requirements.

Programs that provide assistance with health care costs:

  • Medicaid: If you have a low monthly income and few assets, you may be eligible for coverage through Medicaid to pay for Medicare costs, like copayments and deductibles, and for health care not covered by Medicare, such as dental care and transportation to medical appointments.
  • Medicare Savings Programs (MSP): If you have a low monthly income, you may qualify for an MSP, a program that helps pay Medicare costs.
  • Low-cost health centers and clinics: You may pay less for Medicare-covered services if you receive them through low-cost health centers and clinics in your state. For more information, contact your State Health Insurance Assistance Program (SHIP).

Programs that provide assistance with prescription drug costs:

  • Extra Help: Also known as the Part D Low-Income Subsidy (LIS), this federal program that helps individuals with low incomes pay for costs of Medicare prescription drug coverage. If you are enrolled in Medicaid, an MSP, or you receive Supplemental Security Income (SSI), you should get Extra Help automatically. You can apply for the Extra Help program through the Social Security Administration (SSA) or your local Medicaid office.
  • State Pharmaceutical Assistance Programs (SPAPs): Offered in some states to help pay for prescriptions, most SPAPs have income guidelines. Many also require you to enroll in a Medicare Part D plan and to apply for Extra Help. SPAPs generally pay or help pay for the Part D premium and any cost-sharing, as well as offering lower costs while you are in the donut hole. Some SPAPs may also pay for drugs that are excluded from Medicare Part D or are not included in your plan’s formulary.
  • Charity programs: There may be charities that can help reduce your prescription costs. If you have Part D, in some cases the amount the charity pays counts toward your catastrophic coverage limit.
  • Patient Assistance Programs (PAPs): You may be eligible to get free or low-cost drugs directly from the company that makes them, through a PAP. In most cases, your doctor must apply for you. Not all PAPs allow you to apply if you are eligible for Part D.
    • If you are enrolled in a PAP, you may be required to pay a copayment. PAP copays will count toward your Part D plan’s out-of-pocket limit ($8,000 in 2024), but you will need to submit your receipts and any other required documentation to your plan. The amount your PAP pays for your prescription drugs will not count toward your out-of-pocket limit.
  • Prescription drug discount programs: You may be able to get medications you need at a reduced price from national or local discount programs. Note that you cannot use a prescription drug discount program and Part D coverage at the same time: you must select between them at the pharmacy.
    • If you have Part D, it is best to use your discount card during your plan’s deductible and coverage gap periods. This is because during these periods, the amount you pay for drugs on your plan’s formulary may count toward meeting your out-of-pocket maximum. Be sure to tell your pharmacist not to bill your Part D plan. You will also need to submit your receipts and any other required documentation to your plan in order for the costs to be counted toward your out-of-pocket maximum.
  • Safety net providers: Pharmacies in certain government-funded hospitals and community health centers may provide medication at lower costs or charge you based on your income. These centers and clinics include federally qualified health centers (FQHCs) and rural health clinics (RHCs). Some centers may waive copays for drugs covered by your Part D plan if you request assistance. Be sure to contact the facility directly to learn which benefits it offers and which costs may count toward reaching your out-of-pocket maximum.