State and Federal Programs That May Help Lower Your Medicare Costs

Reading Time: 5-6 minutes | Discover state and federal programs that may help reduce your Medicare premiums, prescription drug costs, and other out-of-pocket expenses. 

Paying for health care on a fixed income isn't always easy. Even with Medicare, premiums, deductibles, prescription drug costs, and copays can add up quickly.

The good news is that several federal and state programs are available to help eligible Medicare beneficiaries reduce these costs. Unfortunately, many people who qualify never apply. Some don't realize these programs exist, while others assume they earn too much. That assumption could mean missing out on valuable savings.

At Beuttel Insurance Services, we believe it's always worth exploring your options. A few minutes of research today could potentially save you hundreds—or even thousands—of dollars each year.

Medicaid is a joint federal and state program that helps people with limited income and resources pay for health care.



Some people qualify for both programs and are known as dual eligibles. If you have both Medicare and Medicaid, Medicare generally pays first for covered services. Medicaid may then help pay your Medicare premiums, deductibles, and copays, along with some services Medicare doesn't cover, such as long-term care.

Many dual eligibles enroll in a Dual Eligible Special Needs Plan (D-SNP), a type of Medicare Advantage plan designed to coordinate Medicare and Medicaid benefits under one plan.

Because eligibility rules vary by state, contact your state Medicaid office or your local State Health Insurance Assistance Program (SHIP) to learn whether you qualify.

If you live in California, Medicaid is called Medi-Cal. While the name is different, the purpose is the same—to help eligible Californians with limited income and resources access affordable health care.

For individuals who qualify for both Medicare and Medi-Cal, the two programs work together. Medicare remains your primary health insurance, while Medi-Cal may help pay Medicare premiums, deductibles, copayments, and other out-of-pocket costs. Depending on your eligibility, Medi-Cal may also cover services that Medicare typically doesn't, including certain long-term care and supportive services.

Many Californians assume they won't qualify for Medi-Cal because of their income, but eligibility is based on several factors and has expanded in recent years. If you're struggling with health care expenses, it's worth exploring your options—you may qualify for more assistance than you realize.

If you have questions about Medi-Cal eligibility or how it works alongside your Medicare coverage, our team is always happy to help point you in the right direction.

Medicare Savings Programs

If you are enrolled in Medicaid, you may also be eligible for one of the Medicare Savings Programs (MSPs). These state-run programs are among the most valuable forms of financial assistance available, yet they're often overlooked. They help pay some or all of your Medicare Part A and Part B costs if your income and resources are limited.

There are four Medicare Savings Programs:

1. Qualified Medicare Beneficiary (QMB) - Provides the highest level of assistance and may cover your:

• Medicare Part A premium
• Medicare Part B premium
• Deductibles
• Coinsurance
• Copayments

If you're enrolled in QMB, providers generally cannot bill you for Medicare-covered services. If you receive a bill, let the provider know you're enrolled in the QMB program.

If you're eligible for QMB and also qualify for full Medicaid benefits, you may qualify for QMB+, which allows Medicaid to cover services Medicare doesn't, such as long-term nursing home care or personal care services.

Specified Low-Income Medicare Beneficiary (SLMB)

SLMB helps pay your Medicare Part B premium and is designed for people whose income is slightly above the QMB limit.

Qualifying Individual (QI)

I also helps pay your Part B premium. Funding is limited each year and is available on a first-come, first-served basis, so it's important to apply early.

Qualified Disabled and Working Individual (QDWI)

QDWI helps pay the Medicare Part A premium for certain individuals with disabilities who returned to work.

Income and resource limits vary by state. If you qualify for QMB, SLMB, or QI, you automatically qualify for Extra Help with your Medicare Part D prescription drug costs.

Extra Help With Prescription Drug Costs

Extra Help, also known as the Low-Income Subsidy (LIS), lowers or may even eliminate what you pay for Medicare Part D prescription drug coverage, including your premium, deductible, and prescription copays.

You automatically qualify if you receive:

• Full Medicaid coverage
• Supplemental Security Income (SSI)
• A Medicare Savings Program

If you aren't enrolled in one of these programs, you may still qualify based on income and asset limits established by the Social Security Administration.

2026 Income and Resource Limits

Individuals

• Annual income: $23,475
• Resources: $18,090

Married Couples

• Annual income: $31,725
• Resources: $36,100

Income includes wages, alimony, annuities, self-employment income, pensions, rental income, Social Security benefits, veterans benefits, and workers' compensation.

Income does not include assistance from others for household expenses, disaster assistance, earned income tax credit payments, home energy assistance, housing assistance, medical treatment and drugs, scholarships and education grants, Supplemental Nutrition Assistance Program (SNAP) benefits, or victim compensation payments.

Resources include money in bank accounts, stocks, bonds, and retirement accounts. They do not include your home, one vehicle, up to $1,500 designated for burial expenses, a burial plot, or your personal belongings.

Because limits can change each year, it's always a good idea to verify current eligibility requirements before applying.

For those who qualify, the savings can be significant. In 2026, Extra Help beneficiaries pay:

• No monthly premium
• No deductible
• No more than $5.10 for each generic prescription
• No more than $12.65 for each brand-name prescription

Once out-of-pocket prescription drug costs reach $2,100 for the year, covered prescriptions cost $0 for the remainder of the year.

If you don't qualify automatically, you can apply at any time through the Social Security Administration. When you apply, Social Security can also begin a Medicare Savings Program application for you.

Even if you don't qualify for Extra Help, remember that the $2,100 annual out-of-pocket Part D prescription drug cap applies to everyone with a Medicare Part D drug plan in 2026.

State Pharmaceutical Assistance Programs (SPAPs)

Some states also offer State Pharmaceutical Assistance Programs (SPAPs) to help residents pay for prescriptions, Medicare Part D premiums, or other drug-related expenses.

These programs vary widely from state to state. Some provide direct financial assistance, while others help coordinate benefits with your Medicare drug plan. Not every state offers an SPAP, so check with your local SHIP office to learn what's available where you live.

Help From Drug Manufacturers

Many pharmaceutical companies also offer Patient Assistance Programs for individuals who meet certain eligibility requirements. These programs may help lower the cost of specific medications and are worth exploring if prescription costs are creating a financial burden.

Help With Long-Term Care

One common misconception is that Medicare pays for long-term custodial care. In reality, Medicare generally does not cover extended nursing home stays. Medicaid is the primary payer for these services.

Depending on your state and your financial situation, Medicaid may help cover:

• Nursing home care
• Assisted living services
• In-home caregiving and home health aides
• Community-based long-term care

Because Medicaid's long-term care rules can be complex, many families choose to work with an elder law attorney, Medicaid planner, or their local Area Agency on Aging before applying.

Where to Get Free Help

You don't have to navigate these programs on your own. Free, unbiased assistance is available through:

• Your State Health Insurance Assistance Program (SHIP)
• Your state Medicaid office
• Your local Area Agency on Aging
• Social Security (for Extra Help)
• BenefitsCheckUp through the National Council on Aging
• A licensed Medicare insurance agency like Beuttel Insurance Services
  

Many people are surprised to learn they qualify for programs they never knew existed. If you're unsure whether you may be eligible, it's worth asking the question. Even modest assistance with premiums or prescription costs can save hundreds—or even thousands—of dollars each year.



If you have questions about your Medicare coverage or would like help understanding the programs that may be available to you, we're always happy to help you explore your options.

Connect with our office at 530-303-3366 or visit beuttelinsure.com

This article is intended for general educational purposes only and should not be considered legal, tax, or financial advice. Program eligibility, income limits, and benefits may change. To confirm whether you qualify and obtain the most current information, please contact the appropriate government agency or speak with a licensed Medicare professional.

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