The federal buy-in program enables states to help people pay Medicare premiums and other out-of-pocket medical costs.
The buy-in program started in 1966 and expanded in 1990, and allows states to offer Medicare savings programs.
This article discusses the Medicare buy-in program, the available plans, and coverage. It also looks at eligibility and other options.
We may use a few terms in this piece that can be helpful to understand when selecting the best insurance plan:
- Deductible: This is an annual amount that a person must spend out of pocket within a certain time period before an insurer starts to fund their treatments.
- Coinsurance: This is a percentage of a treatment cost that a person will need to self-fund. For Medicare Part B, this comes to 20%.
- Copayment: This is a fixed dollar amount that an insured person pays when receiving certain treatments. For Medicare, this usually applies to prescription drugs.
The Medicare buy-in program is a federally funded program that helps states offer Medicare savings programs (MSPs) to people with limited income and resources.
MSPs help a person pay their Medicare premiums, deductibles, coinsurance, copays, and other medical expenses. Each of the four MSPs has different eligibility rules and benefits.
MSPs are state-regulated programs that may help a person with certain Medicare out-of-pocket expenses and premiums.
If a person has income from working, and it is higher than the MSP’s listed income limits, they may still qualify for another MSP. In addition, the income limits are higher in Alaska and Hawaii.
If a person qualifies for an SLMB program, QMB, or QI program, they may also be able to get Extra Help, which helps pay for Medicare prescription drug coverage.
Specified low-income Medicare beneficiary (SLMB)
The SLMB program may help pay Medicare Part B premiums for a person enrolled in Medicare Part A, and who has limited income and resources.
As of 2020, the SLMB income and resource limits are as shown in the chart below.
| Status | Monthly income limit | Resources limit |
|---|---|---|
| Individual | $1,296 | $7,860 |
| Married couple | $1,744 | $11,800 |
Qualifying individual (QI)
The QI program may help a person who is enrolled in Medicare Part A to pay Medicare Part B premiums. The person must also have limited income and resources.
A person must apply each year for the QI program, and the system is on a first-come, first-served basis. A person who got QI benefits the previous year has a priority to be in the program.
In addition, a person cannot get QI benefits if they qualify for Medicaid.
As of 2020, the QI monthly income and resource limits are as shown in the chart below.
| Status | Monthly income limits | Resources limits |
|---|---|---|
| Individual | $1,456 | $7,860 |
| Married couple | $1,960 | $11,800 |
Qualified disabled and working individuals (QDWI)
The QDWI program may help a person to pay the Medicare Part A premium.
To qualify for the program a person must meet one of the following conditions:
- A person must be a working person with a disability, and who is less than 65 years old.
- A person must have lost their premium-free Medicare Part A when they returned to work.
- A person must not receive any medical assistance from their state.
- A person must meet their state’s resources and income limits.
As of 2020, the QDWI income and resource limits are as shown in the table below.
| Status | Monthly income limit | Resources limit |
|---|---|---|
| Individual | $4,339 | $4,000 |
| Married couple | $5,833 | $6,000 |
Qualified Medicare beneficiary (QMB)
The QMB Program helps pay for the premiums for original Medicare (Part A and Part B), deductibles, coinsurance, and copays.
Enrollment in the QMB program means a person will not be billed for the items and services covered by Medicare, with the exception of outpatient prescription drugs. A person may be charged a maximum of $3.90 in 2020 for Medicare Part D prescription drugs.
As of 2020, the QMB monthly income and resources limits are as shown in the chart below.
| Status | Monthly income limit | Resources limit |
|---|---|---|
| Individual | $1,084 | $7,860 |
| Married couple | $1,457 | $11,800 |
If a person meets certain criteria, they may be eligible for an MSP. They must:
- be enrolled in Medicare Part A (hospital insurance) or eligible for Part A
- have income for 2020 that is at, or below, the limits for any of the four MSPs
- have limited income below the limits in any of the four MSPs
According to Medicare, if a person has income from working, and it is higher than the listed income limits, they may still qualify for an MSP.
A person can check with their state Medicaid program to find out if they qualify for an MSP.
What is included in the resources limit?
Medicare includes the following items as countable resources, and includes them in the MSP resources limit:
- bonds
- money deposited in a savings or a checking account
- stocks
However, the following items are not included in the resources limit:
- your home
- one car
- a burial plot, and a maximum of $1,500 for burial expenses if the money has been put aside for that purpose
- furniture
- other personal or household items
Extra Help is a federal assistance program that helps a person who has limited income and resources pay their Medicare Part D (prescription drug) costs, including premiums, deductibles, and coinsurance.
If a person is eligible for the SLMB, QMB, or QI programs, they will generally qualify for the Extra Help program. In that case, the Centers for Medicare and Medicaid Services (CMS) will send a notice confirming they will get Extra Help program benefits.
If a person is unsure how much Extra Help they should get, they can check with their prescription drug plan provider. The provider may ask for certain documents, including:
- a Social Security award letter, if a person gets supplemental security income (SSI)
- a green or yellow Medicare notice confirming automatic enrollment
- an orange Medicare notice about a copay change
- a Social Security ‘Notice of Award’ about Extra Help
- a purple Medicare notice confirming automatic enrollment in Extra Help
The federal buy-in program allows states to help people pay their Medicare premiums and other out-of-pocket medical costs through four Medicare savings programs (MSPs).
To be eligible for an MSP, a person must meet the program’s requirements. A person who qualifies for an SLMB, QMB, or QI program may also get Extra Help, which helps pay for Medicare prescription drug coverage.