Medicare covers a lot, but it doesn’t pay for everything — and the premiums, deductibles, and out-of-pocket costs can add up fast. For people with limited income and assets, the federal government and states offer a set of programs that help pay those costs. Collectively called Medicare Savings Programs (MSPs), they can reduce or eliminate some of the biggest Medicare expenses. Many eligible people don’t know these programs exist.
What are Medicare Savings Programs?
Medicare Savings Programs are state-administered programs funded jointly by the states and the federal government. They help low-income Medicare beneficiaries pay for costs that Medicare doesn’t cover, including:
- Medicare Part B premiums ($202.90/month in 2026 for most people)
- Medicare Part A premiums (for those who didn’t work enough to qualify for premium-free Part A)
- Part A and Part B deductibles
- Copays and coinsurance
There are four types of MSPs, each with slightly different income and asset limits. Eligibility rules vary by state, but the federal government sets the baseline.
The four types of Medicare Savings Programs
1. Qualified Medicare Beneficiary (QMB)
QMB is the most comprehensive MSP. It covers Part A and Part B premiums, deductibles, copays, and coinsurance. If you qualify for QMB, providers cannot bill you for Medicare cost-sharing — this is a federal rule, and providers who violate it can face penalties. Income limits are roughly 100% of the federal poverty level (FPL). In 2025, that’s around $1,255/month for an individual.
2. Specified Low-Income Medicare Beneficiary (SLMB)
SLMB covers only the Part B premium. It does not help with deductibles or copays. Income limits are roughly 100–120% of FPL — around $1,255–$1,506/month for an individual in 2025.
3. Qualifying Individual (QI)
QI also covers only the Part B premium, like SLMB, but is available to people with slightly higher incomes — roughly 120–135% of FPL (up to approximately $1,693/month for an individual). QI is funded through an annual appropriation and applicants are served on a first-come, first-served basis. You must reapply every year.
4. Qualified Disabled and Working Individuals (QDWI)
QDWI covers the Part A premium for certain people under 65 who are disabled, returned to work, and lost premium-free Part A. It’s a narrower program that applies to a specific situation. Income limits are around 200% of FPL.
Extra Help for prescription drug costs (Part D LIS)
Separate from the four MSPs above, the Extra Help program (also called the Low-Income Subsidy, or LIS) helps with Part D prescription drug costs. It can reduce or eliminate Part D premiums, deductibles, and copays. If you qualify for a Medicare Savings Program, you automatically qualify for Extra Help — you don’t need to apply separately.
Extra Help can be worth thousands of dollars per year for people who take multiple medications. For 2025, the full Extra Help benefit covers most Part D costs entirely for qualifying individuals.
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Asset limits
MSPs have both income and asset limits. Assets counted typically include bank accounts, stocks, and bonds. Things generally not counted include your primary home, one car, household belongings, and life insurance policies with a face value under $1,500.
Asset limits are higher than many people expect. In 2025, the limits are approximately $9,660 for an individual and $14,470 for a married couple. Some states have eliminated the asset test entirely, so it’s worth checking your specific state’s rules.
How to apply
You apply for Medicare Savings Programs through your state Medicaid office — not through Medicare or Social Security directly. The process varies by state. Some states allow online applications; others require you to apply in person or by mail.
Steps to apply:
- Contact your state Medicaid office or visit your state’s Medicaid website
- Complete the MSP application (often combined with the Medicaid application)
- Provide documentation: proof of income, bank statements, Medicare card, ID
- Wait for a determination (usually a few weeks)
You can also get free help applying through your local State Health Insurance Assistance Program (SHIP). SHIP counselors are trained volunteers who can walk you through eligibility and the application process at no charge. Find your local SHIP at shiphelp.org.
Social Security can help with Extra Help applications. Call 1-800-772-1213 or apply online at ssa.gov.
What if you’re denied?
If you’re denied for an MSP, you have the right to appeal. The denial notice will include instructions for requesting a fair hearing. It’s worth appealing — income and asset rules are sometimes applied incorrectly, and a SHIP counselor can help you prepare.
Also note that income limits change annually. If you were denied in a previous year, you may qualify now if income limits have increased or your income has changed.
Are Medicare Savings Programs the same as Medicaid?
No, but they’re related. MSPs are administered by state Medicaid agencies, and qualifying for certain MSPs can also make you eligible for full Medicaid — but they’re separate programs. You can qualify for an MSP without qualifying for full Medicaid. Full Medicaid has lower income limits and covers a broader range of services including long-term care and nursing home coverage.
People who qualify for both Medicare and full Medicaid are called dual eligibles. They get the most comprehensive coverage, with Medicaid paying costs that Medicare doesn’t cover.
Bottom line
Medicare Savings Programs can save eligible beneficiaries hundreds or thousands of dollars per year on healthcare costs. If your income is modest — generally under about $22,000/year for an individual — it’s worth checking your eligibility. The application is free, the help is real, and many people who qualify never apply because they don’t know these programs exist.
Start with your state Medicaid office, your local SHIP office, or call 1-800-MEDICARE (1-800-633-4227) for a referral.
🆓 Need help navigating Medicare costs and savings programs?
Our partner Chapter Medicare offers free guidance from licensed advisors who know the programs available in your area. They can review your situation and help you understand every option.
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ALWAYS FREE. No obligation.
Disclosure: We may receive a referral from Chapter if you choose to use their service. Chapter is a licensed health insurance agency and is not affiliated with or endorsed by Medicare or any government agency.
Further Reading
- Medicare Costs and Premiums
- Medicare and Medicaid: How They Work Together
- Medicare Part D: Prescription Drug Coverage
- Medicare Enrollment
- How to Choose a Medicare Plan
- Medicare Extra Help (Benefits hub)
This article is for general educational purposes only and does not constitute insurance or financial advice. Visit medicare.gov or contact 1-800-MEDICARE, or consult a licensed advisor for guidance specific to your situation.
