Help with Medicare costs when money is tight

Medicare provides vital health insurance for 50 million seniors and people with disabilities. But even when you have Medicare, health care is not free. People with Medicare pay premiums and have other costs that they pay out of pocket, like deductibles and co-insurance. For lower-income people, these costs can be overwhelming.

There are several programs that help low-income people with Medicare pay their health care costs—but many Medicare beneficiaries don’t know about these programs. Let’s see if we can shed some light on them.

Why might I need help?

Anyone with Medicare knows that the program has significant costs. Here are some common costs for 2014:

Medicare Part A, which covers inpatient care, has a $1,216 deductible that you’ll have to pay if you’re unfortunate enough to be hospitalized.

Medicare Part B, which covers outpatient care (like doctor visits), has a monthly premium of $104.90.

Doctor visits also come with a 20 percent co-payment, and so do lab tests.

If you have Part D drug coverage, that’s an additional premium, which averages about $40 a month, plus co-payments for your prescriptions.

Finally, there are a number of services that Medicare does not cover, like most long-term care.

Half of people with Medicare live on incomes below $23,500 a year, so it’s no surprise that a lot of seniors spend a good share of their budget on health care.

What help is available to beneficiaries with low incomes?

The Part D “Extra Help” program can cover all or part of your Part D premiums and costs.

Each state runs three Medicare Savings Programs. Different states have different names for these programs. All of these programs will cover your Part B premium. Lower-income people can also get their Medicare co-insurance and deductibles covered.

Some beneficiaries with low incomes or high health care expenses may qualify for their state’s Medicaid program, which covers a number of services that Medicare does not.

How can I qualify?

Income limits vary from state to state and are adjusted every year. But they are low. In general, the 2014 income limit for any type of assistance is about $17,500 a year for an individual and $23,600 a year for a couple.

Most programs also look at how much you have in assets (bank accounts, retirement, etc.), although the value of your home and car usually don’t count toward asset limits. In 2014, the asset limit is about $7,000 for an individual and $11,000 for a couple. But some states have adopted higher asset limits or eliminated them altogether, so check to see what the rules are in your state.

How can I get help?

To learn more about the programs in your state and get help navigating the application process, contact your local State Health Insurance Assistance Program (SHIP). Every state has one, and they provide free, unbiased advice to people with Medicare. Call 1-800-MEDICARE or go to www.Medicare.gov and click on “Find someone to talk to.”

How do I apply?

You can learn more about the Part D Extra Help program and apply through the Social Security website at www.socialsecurity.gov/prescriptionhelp.

To apply for your state’s Medicare Savings Programs or Medicaid, contact your state’s Medicaid agency. A counselor with your local SHIP can help you start the process and advise you if you run into problems.

Are there other options for getting help with Medicare costs?

Maybe. These options are worth investigating.

It’s always a good idea to explore options in your area. Some states provide additional help with prescription drug costs.

If you are a veteran, you may qualify for additional help through the Department of Veterans Affairs (VA).

Make sure you’re taking full advantage of any help you may get from a former employer.

Finally, you may want to explore getting a Medicare supplement (Medigap) or Medicare Advantage plan. But be careful, because some of these plans can be costly, and others may limit which doctors you can see. A local SHIP counselor can help you assess your options.