Starting in 2024, more people will qualify for the full Medicare Part D assistance program

With up to 3 million more Medicare enrollees with low incomes and limited resources eligible in January 2024 for additional financial assistance to pay for their Part D prescription drug costs, federal officials are making a push to let older adults and people with disabilities know about the Extra Help program and how it is expanding.

The Department of Health and Human Services (HHS) estimates that nearly 300,000 people on Medicare currently enrolled in Extra Help but who only get partial benefits will be eligible for the full benefit next year under a provision of the prescription drug law signed in August 2022. This means they will pay no deductible for their Part D medications, no premiums for their Part D plans and lower copays for some of their prescription drugs.

According to HHS data, nearly 1.8 million Medicare beneficiaries were eligible for the full Extra Help program in 2021 but weren’t enrolled, and an additional 1.2 million either were getting partial Extra Help benefits or were not enrolled but would be eligible for the full expanded benefit in 2024. About 13 million Medicare recipients are currently enrolled in Extra Help.

The income threshold for full benefits currently is 135 percent of the federal poverty guideline ($19,683 for an individual in 2023). Beginning in January 2024, the income threshold for full benefits will be raised to 150 percent of the federal poverty level ($21,870 for an individual in 2023).

Individuals enrolled in the Extra Help program are responsible for modest copays for their drugs until they reach the catastrophic phase of Part D; after that they don’t pay anything for their drugs. As of 2024, any Medicare beneficiary who enters the catastrophic phase will not have to pay anything more for their drugs. Starting in 2025 there will be an annual $2,000 cap on out-of-pocket expenses for everyone who gets their medications through a Part D or Medicare Advantage plan.

Extra Help is administered by the Social Security Administration (SSA). In addition to an annual income limit, the program includes a resources test. According to SSA, to qualify for Extra Help in 2023 an individual must have resources of less than $16,660; a married couple’s resources can’t be any more than $33,240.

SSA has an online brochure that explains how the Extra Help program works and what assets are included in the resource limit. For example, an applicant’s bank accounts, retirement savings (IRAs, mutual funds, etc.) and real estate other than the home they live in are all included in the asset test. But the person’s car, insurance policies and personal possessions are not included.

Outreach efforts starting

Expansion of the Extra Help program was one of the provisions AARP fought for in its advocacy for the new law that will help reduce prescription drug prices and costs. According to a report from the nonpartisan Kaiser Family Foundation, “this provision will benefit low-income Black and Hispanic Medicare beneficiaries in particular, who are more likely than white beneficiaries to have incomes between 135 percent and 150 percent of poverty.”

HHS officials say when they reach out, screen and enroll people in Extra Help, they will focus on Americans who live in rural areas and underserved communities.

Outreach to people who qualify for Extra Help but aren’t enrolled will include training for State Health Insurance Program (SHIP) counselors as well as agents and brokers as part of the agency’s open enrollment training. Information on the program will be included in the “Medicare & You” handbook, and representatives who answer calls on the Medicare hotline (800-633-4227) will also be told to provide information on the program.