How to Get $800 Back From Medicare?
Effectively manage Medicare costs. Learn how to reduce your out-of-pocket expenses and access financial assistance to save on healthcare.
Individuals often refer to reducing Medicare out-of-pocket expenses or receiving financial assistance as “getting money back” from Medicare. This article explores avenues for beneficiaries to manage and reduce their financial obligations, covering premiums, deductibles, and co-insurance.
Understanding Medicare Costs
Medicare, the federal health insurance program for people aged 65 or older and certain younger people with disabilities, involves several types of costs. Original Medicare consists of Part A (Hospital Insurance) and Part B (Medical Insurance). Part A typically has no monthly premium for most, but it does include a deductible ($1,632 in 2024) and co-insurance payments for extended hospital stays ($408 per day for days 61-90 in 2024).
Part B covers doctor visits, outpatient care, and preventive services, requiring a monthly premium ($174.70 for most in 2024). It also has an annual deductible ($240 in 2024), after which Medicare generally pays 80% of approved amounts, leaving the beneficiary responsible for 20% co-insurance. Medicare Part D provides prescription drug coverage, with costs varying by plan, often including a monthly premium, an annual deductible, and co-payments or co-insurance.
Government Programs for Cost Reduction
Several government programs help eligible Medicare beneficiaries reduce out-of-pocket expenses. Medicare Savings Programs (MSPs) are state-administered initiatives that assist with Medicare Part A and/or Part B costs. The Qualified Medicare Beneficiary (QMB) Program, a common MSP, helps pay for Part A and Part B premiums, deductibles, and co-insurance. Individuals generally qualify if their monthly income is at or below 100% of the federal poverty level and resources are below limits like $9,910 for an individual or $14,860 for a couple in 2024.
The Specified Low-Income Medicare Beneficiary (SLMB) Program helps pay the Part B premium for individuals with incomes between 100% and 120% of the federal poverty level, with similar resource limits. The Qualifying Individual (QI) Program helps pay the Part B premium for those with incomes between 120% and 135% of the federal poverty level, also with similar resource limits.
The Low-Income Subsidy (LIS), also known as “Extra Help,” is a federal program assisting with Medicare Part D prescription drug costs. This subsidy helps pay for Part D premiums, deductibles, and co-payments, significantly lowering medication costs. Eligibility depends on annual income and resource limits, such as monthly income below $1,843.75 for an individual or $2,485.42 for a couple in 2024, and resources below $16,660 for an individual or $33,300 for a couple.
Other Coverage Options for Savings
Beyond government assistance programs, other insurance options can help manage and reduce Medicare out-of-pocket costs. Medigap, or Medicare Supplement Insurance, is private health insurance that works with Original Medicare. These plans help pay for healthcare costs Original Medicare does not cover, such as co-payments, co-insurance, and deductibles. This provides more predictable out-of-pocket expenses, reducing financial surprises.
Medicare Advantage Plans (Part C) are another way to receive Medicare benefits through a private insurance company approved by Medicare. These plans cover all Original Medicare Part A and Part B services, and many include extra benefits like vision, hearing, dental, and prescription drug coverage (MAPD plans). Medicare Advantage Plans often have their own network of providers, different cost-sharing structures, and an annual out-of-pocket limit, which can cap yearly spending on covered medical services.
Applying for Financial Assistance
Applying for financial assistance programs like Medicare Savings Programs (MSPs) and the Low-Income Subsidy (LIS) involves specific steps. For MSPs, apply through your state’s Medicaid agency or department of social services. The application requires detailed financial information, including proof of income from all sources like Social Security benefits, pensions, and employment wages. You will also need to provide documentation of your resources, such as bank statements, property deeds, and investment account statements.
For the Low-Income Subsidy (Extra Help), apply through the Social Security Administration (SSA) online, by phone, or in person at a local SSA office. The Extra Help application requires information about your income and resources, similar to the MSP application. When applying for either program, have recent tax returns, pay stubs, bank statements, and retirement or investment account statements readily available for accuracy and completeness. After submitting your application, the agency will review your information and notify you of their decision, which may include approval, denial, or a request for additional documentation.