Medicare Savings Programs: Help with Premiums

Medicare provides essential health coverage for 68 million older adults and people with disabilities. But out-of-pocket costs, such as monthly premiums, deductibles, and copayments, can strain a modest household budget.

If you struggle to pay these medical costs, Medicare Savings Programs (MSPs) can help. State Medicaid agencies administer these programs. Depending on your income and which program you qualify for, they may pay your Medicare Part B premium and other out-of-pocket Medicare costs.

 What Are Medicare Savings Programs?

Medicare Savings Programs are state-run assistance programs, funded jointly by state governments and federal Medicaid dollars. They help Medicare beneficiaries who live on lower or fixed incomes.

An MSP | New Window does not replace your Medicare coverage. It works alongside it. Once you enroll, your state Medicaid office pays specific Medicare costs on your behalf.

Depending on which program you qualify for, an MSP can save you thousands of dollars a year by covering:

• Medicare Part B monthly premiums ($202.90/month in 2026, per CMS)
• Medicare Part A monthly premiums, for people who don't qualify for premium-free Part A
• Out-of-pocket cost-sharing, including deductibles, copayments, and coinsurance for doctor visits and hospital stays

 Who Can Qualify?

Eligibility depends mainly on two things: your monthly income and your countable financial resources (assets). Each of the four programs has its own limits, and those limits are higher for married couples than for single people.

Even if you're not sure your income or savings fall within the limits, it's worth applying. Many states use higher thresholds than the federal baseline, and some don't count assets at all. The full 2026 limits are in the table below.

The Four Medicare Savings Programs

There are four Medicare Savings Programs. Each one serves a different income level and offers a different level of help.

1. Qualified Medicare Beneficiary (QMB) Program

QMB | New Window offers the most complete coverage of the four programs. It's meant for beneficiaries with the greatest financial need.

If you qualify for QMB, the state pays your Medicare Part B premium (and your Part A premium, if you owe one). QMB also covers your Part A and Part B deductibles, copayments, and coinsurance.

Provider billing protection: By federal law, doctors, hospitals, and other providers who accept Medicare cannot bill QMB enrollees for Medicare-covered deductibles, copayments, or coinsurance. This is called "balance billing," and it's illegal even if Medicaid doesn't pay the provider's full rate.

2. Specified Low-Income Medicare Beneficiary (SLMB) Program

SLMB | New Window is for people whose income is a bit too high to qualify for QMB.

SLMB covers one thing: your monthly Medicare Part B premium. If you qualify, the state pays it in full. You're still responsible for standard Medicare deductibles and copayments when you get care.

3. Qualifying Individual (QI) Program

Like SLMB, the QI program | New Window pays your monthly Medicare Part B premium. It's available to people with slightly higher incomes than SLMB allows.

QI works a bit differently, though. It runs on limited annual federal funding, and states approve applications on a first-come, first-served basis. Current enrollees usually get priority when they reapply, but you must reapply every year to keep your QI benefits.

4. Qualified Disabled and Working Individual (QDWI) Program

QDWI | New Window is for people under 65 who have a disability, went back to work, and lost their premium-free Medicare Part | New Window A coverage as a result.

If you meet the income and asset limits, QDWI pays your monthly Medicare Part A premium, so you can keep your coverage while you keep working.

Understand healthcare programs, coverage, how they fit together, and check your benefit eligibility with BenefitKarma’s Healthcare Guide | New Window.

2026 Income and Resource Limits

Eligibility is based on your monthly countable income and your total countable financial resources. The figures below reflect the standard 2026 federal minimum baseline (including standard income disregards).

Note: Baseline limits are slightly higher for residents of Alaska and Hawaii.

What Counts as a Resource?

States only count certain assets when deciding if you qualify:

• Countable resources generally include money in checking and savings accounts, stocks, bonds, and other investments. Rules on retirement accounts, such as IRAs, vary by state. Your state Medicaid agency can tell you exactly which assets count toward your eligibility.
• Excluded resources typically include your primary home, one vehicle, household items, personal belongings, burial plots, and up to $1,500 set aside for burial expenses.

State Variations and Expanded Limits

The numbers above are the federal minimum. Many states are more generous:

• Higher income limits: Several states set income thresholds well above the federal guidelines.
• Eliminated asset tests: A growing number of states (including Connecticut, Delaware, and New York) have dropped the resource test entirely for QMB, SLMB, and QI.
• Higher asset caps: Other states, like California, use much higher resource limits.

Always apply through your state, even if your income or savings appear to exceed the federal numbers above.

Automatic Extra Help With Prescription Drug Costs

One of the biggest benefits of an MSP is automatic prescription drug savings.

If you're approved for QMB, SLMB, or QI, you're automatically enrolled in Medicare's Extra Help program (also called the Low-Income Subsidy). No separate application is needed.

Approved for QMB, SLMB, or QI → Automatic enrollment in Extra Help → Lower drug costs

Extra Help provides meaningful savings by:

• Reducing or eliminating your Medicare Part D | New Window premium, depending on which prescription drug plan you choose
• Eliminating your annual Part D deductible
• Capping your out-of-pocket cost for covered drugs; no more than $12.65 per brand-name drug in 2026
• Waiving any Part D late-enrollment penalty you may have built up

How to Apply for a Medicare Savings Program

Applying for an MSP is free and is handled through your state's Medicaid agency. Here's how to prepare and submit your application:

1. Gather your documents. Collect proof of income and assets for yourself and your spouse. This typically includes Social Security award letters, pension statements, pay stubs, bank statements, and a copy of your Medicare card.
2. Contact your state office or SHIP. Reach out to your state Medicaid agency or your State Health Insurance Assistance Program (SHIP | New Window). SHIP counselors offer free, unbiased help with your application.
3. Complete the application. Fill out your state's MSP application carefully. Report all income and resources accurately to avoid delays.
4. Submit your application. Send your completed application online, by mail, or in person, following your state's instructions. Your state agency will review it and send you a written notice of eligibility.

Is a Medicare Savings Program Right for You?

If Medicare premiums and copayments are straining your finances, applying for a Medicare Savings Program is one of the most effective steps you can take. Enrolling in QMB, SLMB, or QI can reduce your monthly Medicare costs by covering your Part B premium, and it also secures automatic savings on your prescription drugs.

Take time today to check your state's eligibility rules, or contact a local SHIP counselor for guidance. Even if you're not sure you meet every requirement, applying ensures you get all the benefits and cost protections you deserve.