Medicare

What You Pay

Medicare doesn’t pay for all of your medical expenses. You may have to pay:

  • Premiums, monthly payments you must make whether or not you use any medical services. Medicare premiums may be deducted directly from your Social Security Disability Insurance (SSDI) or Social Security retirement benefits.
  • Copayments, a set amount you have to pay for a medical visit or service. The amount depends on the service.
  • Co-insurance, a set percentage of the cost of a visit or service that you must pay.
  • A deductible, a set amount of money that you pay out of your own pocket each year before Medicare begins to pay for certain services. Once you have paid the deductible, you do not have to pay it again until the next calendar year.

The exact amounts you have to pay vary:

  • With Medicare Advantage, you need to make sure you understand your plan, because each plan is different. All Medicare Advantage plans have an out-of-pocket maximum of at most $8,850 for covered services and treatment, not including prescription drugs.
  • With Original Medicare, the costs are more standardized for Parts A and B, though if you have a Part D plan or Medigap policy (Medicare Supplement Insurance), costs may vary. Original Medicare does not have an out-of-pocket maximum. Learn more about Original Medicare expenses.

Help Paying for Medicare

Regardless of whether you have Original Medicare or Medicare Advantage, you may qualify for help paying for Medicare. There are two main types of help: Medicare Savings Programs (MSPs) and the Low Income Subsidy (LIS) for prescription drug coverage.

Note: If you have both Medi-Cal (or Medi-Cal's Working Disabled Program) and Medicare coverage, they may pay your Part B premium and you may be automatically signed up for an MSP and the LIS. You can check on this with your county social services agency or by calling the Health Insurance Counseling & Advocacy Program (HICAP) at 1-800-434-0222.

Medicare Savings Programs (MSPs)

An MSP may help you pay Medicare premiums and other expenses, such as copayments, co-insurance, and deductibles, if you have countable income at or below 135% of FPG ($1,695 per month, $2,300 for couples).

If you qualify, an MSP may help with Parts A and B of Original Medicare, or with any Medicare Advantage plan.

The three main Medicare Savings Programs help in different ways. Generally speaking, the less income you have, the more they help:

  • The Qualified Medicare Beneficiary (QMB) program helps people with countable income that’s 100% of FPG or less ($1,255 per month or less if you live alone).
    • If you have Original Medicare, QMB helps pay for your Part B and Part A premiums, copayments, and deductibles.
    • If you have a Medicare Advantage plan, QMB helps pay your premium, copayments, and deductibles.
    • Note: If you qualify for QMB, you also qualify for Medi-Cal coverage.
  • The Specified Low-Income Beneficiary (SLMB) program helps people with countable income that’s more than 100% of FPG, but at or below 120% of FPG ($1,506 per month or less if you live alone).
    • If you have Original Medicare, SLMB helps pay for the Part B premium.
    • If you have a Medicare Advantage plan, SLMB helps with the premium.
  • The Qualified Individual (QI) program helps people with countable income that’s more than 120% of FPG, but at or below 135% of FPG ($1,695 per month or less if you live alone).
    • If you have Original Medicare, QI helps pay for the Part B premium.
    • If you have a Medicare Advantage plan, QI helps with the premium.

Call your county Health Insurance Counseling & Advocacy Program (HICAP) office to learn more about whether you qualify for a Medicare Savings Program. If you do, they'll explain how to apply at your local county social services agency.

No more Medi-Cal/MSP resource limits

On January 1, 2024, Medi-Cal resource limits were completely removed. This applies to Medi-Cal through A&D FPL, the Working Disabled Program (WDP), and ABD–MN, as well as Medicare Savings Programs (MSPs). If you've been denied Medi-Cal or an MSP because you had too much in resources, try applying again.

Note: This doesn't change SSI-linked Medi-Cal or Medi-Cal through SSI 1619(b), as they still have SSI's $2,000 resource limit. And it doesn't change income-based Medi-Cal, which never had a resource limit.

You should apply for help paying for Medicare

Many people who qualify for an MSP or the LIS never apply. You should apply, even if you think you don’t qualify, because MSPs and the LIS only look at your countable income, which may be a lot lower than you realize. For example, they count less than half of your earned income. If you have any questions, call the Health Insurance Counseling & Advocacy Program (HICAP) at 1-800-434-0222.

Your Countable Income:

Low Income Subsidy (LIS)/Extra Help for Prescription Drug Coverage

The Low Income Subsidy, often called Extra Help, may help you with Medicare prescription drug expenses, such as copayments and deductibles, if you are in one of these situations:

  • You also get Medi-Cal coverage
  • You are in a Medicare Savings Program (MSP), or
  • You have countable income below $20,331 per year if you are single ($27,594 for couples) and resources less than $15,720 if you are single ($31,360 for couples). Not all of your income and resources are counted when you apply for the Low Income Subsidy. You can apply even if you don’t think you qualify.

If you have Original Medicare and a Part D benchmark plan, you don’t have to pay a Part D premium or deductible, and there may be lower copayments.

If you have a Medicare Advantage plan that includes prescription drug coverage, it helps with your premium and deductible, and there may be lower copayments. The exact amount it helps depends on your plan.

You can apply for the Low Income Subsidy online or at your local Social Security office.

Note: Before 2024, there used to be a "Partial LIS" that didn't help as much. Now, everybody who qualifies for the LIS gets the full subsidy.

Finding cheaper Part D, Medicare Advantage, and Medigap plans

If you don’t qualify for an MSP or the LIS and you want to save money, you still have options:

Medicare Part D costs going down

Over the last few years, some Medicare Part D prescription drug costs have gone down:

  • Since January 1, 2023, you don’t have to pay for any vaccine covered by Medicare Part D (no deductible, co-pay, or other charge).
  • Since January 1, 2023, insulin can’t cost you more than $35 a month starting on January 1, 2023. Since July 1, 2023, if you use a traditional pump, your insulin is covered.
  • Since January 1, 2024, more people qualify for the Low Income Subsidy (Extra Help) and everybody who qualifies gets the full subsidy. (There's no more partial subsidy.)
  • The cost of covered drugs may go up more slowly, because drug companies will have to pay rebates to Medicare if their prices rise faster than inflation.

Learn more about these and other changes coming in later years.

How Work Affects Your Medicare Costs

If you currently qualify for an MSP or the LIS, money you make at work might cause your MSP or LIS eligibility to change or end. However, they count less than half of your earned income, so getting a job does not always mean that you lose the help you get.

The other way work could affect Medicare is if you get SSDI, because your Medicare coverage is based on your SSDI eligibility. However, even if you stop getting SSDI, you may be able to keep your Medicare coverage:

  • With SSDI, you can try out working without losing your SSDI or Medicare benefits. First, you go through a Trial Work Period. Once you use nine Trial Work months, your Trial Work Period is over. Get more detailed information about the Trial Work Period on DB101’s SSDI and Work page.
  • After your Trial Work Period ends, you still get at least 93 more months (7 years and 9 months) of Medicare coverage at the regular cost, as long as Social Security finds that you still have a medical disability.
  • After the 93 months are over, you may still be able to get Medicare at the regular cost through the Qualified Disabled Working Individual (QDWI) Medicare Savings Program, if your countable income is 200% of FPG or less ($2,510 per month or less if you live alone).
    • With Original Medicare, QDWI helps pay for the Part A premium that you otherwise would have to pay. With Medicare Advantage, it also helps with the premium.
    • If your income is higher, you may need to pay a higher premium for Medicare, but you still keep your coverage. With Original Medicare, the Part A premium is up to $505 per month. With a Medicare Advantage plan, your premium may go up a similar amount.
    • You can apply for an MSP at your county social services agency.

Note: If you get Medicare and are 65 years old or older, you keep your Medicare eligibility, no matter how much you earn. However, as your earnings go up, you may need to start paying higher premiums.

Learn more