Medicare Savings Programs - dummies

By Patricia Barry

Copyright © 2018 by AARP. All rights reserved.

To be eligible for a Medicare Savings Program (MSP), your income and savings must be below certain limits, which vary according to the state you live in. However, the limits are generally higher than those required to qualify for Medicaid, and some states don’t take savings into account at all. So it’s well worth applying.

MSPs come in four varieties, each with a different income limit — and each with a name of jumbled letters that only bureaucrats could devise. Here’s what each means:

  • Qualified Medicare Beneficiary (QMB, or “quimby”): Pays your Part B premiums — and also Part A premiums if you have to pay these — and other Medicare costs such as deductibles and co-pays
  • Specified Low Income Medicare Beneficiary (SLMB, or “slimby”): Pays only Part B premiums
  • Qualifying Individual (QI): Pays only Part B premiums, with a slightly higher income and resource limit than SLMB
  • Qualified Disabled and Working Individuals (QDWI): Pays only Part A premiums for low-income people who have Medicare through disability but are no longer entitled to free Part A coverage because they’ve returned to work

Qualifying for a Medicare Savings Program — even if it pays only the Part B premium — has another huge advantage: You’re automatically entitled to full Extra Help under the Part D prescription drug program, which means very low costs. Another benefit of qualifying for an MSP is that if you’re required to pay a late penalty because you delayed enrolling in Part B beyond your deadline, the state will pay your Part B premium and the penalty will be waived.

To find out whether you’re eligible for an MSP, contact your local Medicaid office — call Medicare at 800-633-4227 (TTY 877-486-2048) for its phone number. Or call your state’s SHIP at the number.