Medicare’s Extra Help Program Can Save You Big Time on Prescription Drug Costs

To say prescription medications can be expensive is an understatement.

Sadly, we’ve all heard or read stories about how some older Americans are forced to ration food or not pay certain bills in order to afford medications that improve their quality of life – or keep them alive.

According to a report recently released by the AARP Public Policy Institute, the retail cost of some commonly-used brand name prescription drugs are climbing twice as much as inflation.  

And the pandemic hasn’t altered this pattern. In 2020, the cost of 260 medications rose nearly 3%. Meanwhile, the inflation rate was 1.3%.

Extra Help is available

But here’s some good news. If you’re a Medicare beneficiary with limited income and resources, Medicare’s Extra Help program can help you pay prescription drug (Part D) costs, including monthly premiums, copays, and yearly deductibles.

The Social Security Administration estimates the Extra Help program can save participants about $5,000 a year. Besides having limited resources and income, you must live in one of the 50 states or in Washington, D.C.

What documentation do I need?

You can apply for Extra Help online.

While you do not have to be enrolled in Medicare Part D to apply for the Extra Help Program, the assistance won’t begin until you enroll with a Medicare-approved prescription drug provider. (Also, submitting an Extra Help application does NOT enroll you in Part D.)

Types of documentation you can send to your prescription drug plan include:

• A purple notice from Medicare saying you automatically qualify for Extra Help
• Yellow or green automatic enrollment notice from Medicare
• Extra Help “Notice of Award” from Social Security
• Orange notice from Medicare stating your copayment amount will change next year

What happens after my insurer has the information?

Your plan must ensure you don’t pay more than the Low Income Subsidy (LIS) Drug coverage cost limit.

For the remainder of 2021, the Extra Help Program enrollee prescription costs should be no higher than $3.70 for each generic drug and $9.20 for each brand-name covered medication.

More tips to lower prescription costs

If you don’t qualify for the Extra Help Program – or even if you do – there are other steps you can take to lower your prescription costs:

• Always ask if a generic drug is available. They are considerably less expensive than many brand-name medications.
• Use a mail-order pharmacy service. You’ll not only pay less for your medication, it will be delivered directly to your home.
• Did you know some Medicare drug plans cost less than others? Medicare will help you compare the costs of the available plans.

Finally, some states have a Pharmaceutical Assistance Program. In Delaware, there’s a program to help the elderly and/or disabled who can’t afford the full cost of prescriptions. Meanwhile, in New York, there is an Elderly Pharmaceutical Insurance Coverage (EPIC) program.

Finally, there’s NeedyMeds, a nonprofit organization connecting individuals to programs that can help them with prescription costs. Its Drug Discount Card can save you up to 80% on some medications. It’s free and you don’t have to register for it.

Summary

Based on current and anticipated trends, the cost of prescription drugs will only continue to rise – and at a significantly faster rate than inflation.

But there’s help available. The Medicare Extra Help Program can assist older Americans who struggle to afford medications that improve – or sustain – their lives.

So can shopping wisely for prescription drug plans, choosing generic medications where possible, and checking out state and nonprofit prescription assistance programs.