Medicare Savings Programs (MSPs) pay for the monthly Medicare Part B premium for low-income Medicare beneficiaries, qualify enrollees for the "Extra Help" subsidy for Part D prescription drugs, and -- for those in QMB - pay Medicare coinsurance and deductibes. In 2023, there are now TWO separate MSP programs, the Qualified Medicare Beneficiary (QMB) Program and the Qualified Individual (QI) Program. The Specified Low Income Medicare Beneficiary (SLMB) Program was phased out and everyone who had SLIMB will qualify for QMB.
State law: N.Y. Soc. Serv. L. § 367-a(3)(a), (b), and (d).
Income Limits for MSP's increased in 2023 in NYS!! see Table below
TOPICS COVERED IN THIS ARTICLE
1A. Summary Chart of MSP Programs with current income limits
9. Medicare Insurance Premium Payment (MIPP) Program - alternate to MSP in some situations. See this article for more info.
Since April 1, 2008, none of the MSP programs have resource limits in New York -- which means many Medicare beneficiaries who might not qualify for Medicaid because of excess resources can qualify for an MSP.
Both of the MSP programs has different income eligibility requirements and provides different benefits. The income limits are tied to the Federal Poverty Level (FPL). The figures in the above chart are based on the 2023 FPL, announced by NYS DOH. on Feb. 10, 2023 in the DOH GIS 23 MA/02 - 2023 Federal Poverty Levels and ATTACHMENT.
The rules for counting income for SSI-related (Aged 65+, Blind, or Disabled) Medicaid recipients, borrowed from the SSI program, apply to the MSP program, except for the new rules about counting household size for married couples. N.Y. Soc. Serv. L. 367-a(3)(c)(2), NYS DOH 2000-ADM-7, 89-ADM-7 p.7. Gross income is counted, although there are certain types of income that are disregarded.
The most common income disregards, also known as deductions, include:
(a) The first $20 of your & your spouse's monthly income, earned or unearned ($20 per couple max);
(b) SSI EARNED INCOME DISREGARDS:
* The first $65 of monthly wages of you and your spouse,
* One-half of the remaining monthly wages (after the $65 is deducted);
* Other work incentives including PASS plans, impairment related work expenses (IRWEs), blind work expenses, etc. For information on these deductions, see The Medicaid Buy-In for Working People with Disabilities (MBI-WPD) and other guides in this article -- though written for the MBI-WPD, the work incentives apply to all Medicaid programs, including MSP, for people age 65+, disabled or blind.
(c) monthly cost of any health insurance premiums but NOT the Part B premium, since Medicaid will now pay this premium (may deduct Medigap supplemental policies, vision, dental, or long term care insurance premiums, and the Part D premium but only to the extent the premium exceeds the Extra Help benchmark amount)
(d) Food stamps not counted.
You can get a more comprehensive listing of the SSI-related income disregards on the Medicaid income disregards chart.
As for all benefit programs based on financial need, it is usually advantageous to be considered a larger household, because the income limit is higher. The above chart shows that Households of TWO have a higher income limit than households of ONE. The MSP programs use the same rules as Medicaid does for the Disabled, Aged and Blind (DAB) which are borrowed from the SSI program for Medicaid recipients in the “SSI-related category.” Under these rules, a household can be only ONE or TWO. 18 NYCRR 360-4.2. See DAB Household Size Chart.
Married persons can sometimes be ONE or TWO depending on arcane rules, which can force a Medicare beneficiary to be limited to the income limit for ONE person even though his spouse who is under 65 and not disabled has no income, and is supported by the client applying for an MSP.
EXAMPLE: Bob's Social Security is $1300/month. He is age 67 and has Medicare. His wife, Nancy, is age 62 and is not disabled and does not work. Under the old rule, Bob was not eligible for an MSP because his income was above the Income limit for One, even though it was well under the Couple limit.
2010 NYS DOH change - all married individuals areconsidered a household of TWO. DOH GIS 10 MA 10 Medicare Savings Program Household Size, June 4, 2010. This rule for household size is an exception to the rule applying SSI budgeting rules to the MSP program. Under these rules, Bob is now eligible for an MSP.
When is One Better than Two? Of course, there may be couples where the non-applying spouse's income is too high, and disqualifies the applying spouse from an MSP. In such cases, "spousal refusal" may be used SSL 366.3(a). (Link is to NYC HRA form, can be adapted for other counties).
1. Qualified Medicare Beneficiary (QMB). The QMB program provides the most comprehensive benefits. 2023 -- Income limit increasing from 100% to 138% of the Federal Poverty Level (FPL). The QMB program covers virtually all Medicare cost-sharing obligations: Part B premiums, Part A premiums, if there are any, and any and all deductibles and co-insurance. QMB coverage is not retroactive. The program’s benefits will begin the month after the month in which your client is found eligible.
** See special rules about cost-sharing for QMBs below - updated with new CMS directive issued January 2012
** Even if you do not have Part A automatically, because you did not have enough wages, you may be able to enroll in the Part A Buy-In Program, in which people eligible for QMB who do not otherwise have Medicare Part A may enroll, with Medicaid paying the Part A premium (Materials by the Medicare Rights Center).
2. Specified Low-Income Medicare Beneficiary (SLIMB). This program has been eliminated starting 2023. All current SLIMB members will be eligible for QMB, for which the income limit is increasing to 138% FPL. Some will also qualify for Medicaid if their assets are within the Medicaid limits, which are also increasing. Through 2022, SLIMB is for those with incomes between 100% and 120% FPL, and covers Part B premiums only. TIMING for switching current SLIMB's to QMB. In December 2022, all those in a Medicare Savings Program who do not also have Medicaid received this notice, which is an attachment to GIS 22 MA/10). This includes those in QMB, SLIMB, and QI-1. The notice explains that they may either submit:
3. Qualified Individual (QI-1). Through 2023, QI-1 is for those with incomes between 138% - 186% FPLwho do not have Medicaid, increased from a 135% FPL limit. QI-1 program covers Medicare Part B premiums only. QI-1 is also retroactive, providing coverage for three months prior to the month of application, as long as your client was eligible during those months. However, QI-1 retroactive coverage can only be provided within the current calendar year. (GIS 07 MA 027) So if you apply in January, you get no retroactive coverage.
Q-I-1 recipients would be eligible for Medicaid with a spend-down, but if they want the Part B premium paid, they must choose between enrolling in QI-1 or Medicaid with a spend-down. They cannot have both. It is their choice. DOH MRG p. 19. In contrast, one may receive Medicaid and QMB (or SLIMB through 2022).
In Dec. 2022, QI-1 recipients received the same notice described above for SLIMB group, explaining that they may submit a Medicaid application if their assets are within the Medicaid limits, or submit an MSP application (DOH-4328) to upgrade to QMB.
4. Four Special Benefits of MSPs (in addition to NO ASSET TEST):
Benefit 1. Back Door to Medicare Part D "Extra Help" or Low Income Subsidy --
All MSP recipients are automatically enrolled in Extra Help, the subsidy that makes Part D affordable. They have no Part D deductible or doughnut hole, the premium is subsidized, and they pay very low copayments. Once they are enrolled in Extra Help by virtue of enrollment in an MSP, they retain Extra Help for the entire calendar year, even if they lose MSP eligibility during that year.
Benefit 2. MSPs Automatically Waive Late Enrollment Penalties for Part B
Generally one must enroll in Part B within the strict enrollment periods after turning age 65 or after 24 months of Social Security Disability. An exception is if you or your spouse are still working and insured under an employer sponsored group health plan, or if you have End Stage Renal Disease, and other factors, see this from Medicare Rights Center. If you fail to enroll within those short periods, you might have to pay higher Part B premiums for life as a Late Enrollment Penalty (LEP). Also, you may only enroll in Part B during the Annual Enrollment Period from January 1 - March 31st each year, with Part B not effective until the following July. Enrollment in an MSP automatically eliminates such penalties... for life.. even if one later ceases to be eligible for the MSP. AND enrolling in an MSP will automatically result in becoming enrolled in Part B if you didn't already have it and only had Part A. See Medicare Rights Center flyer.
Benefit 3. No Medicaid Lien on Estate to Recover MSP Benefits Paid
Generally speaking, states may place liens on the Estates of deceased Medicaid recipients to recover the cost of Medicaid services that were provided after the recipient reached the age of 55. Since 2002, states have not been allowed to recover the cost of Medicare premiums paid under MSPs. In 2010, Congress expanded protection for MSP benefits. Beginning on January 1, 2010, states may not place liens on the Estates of Medicaid recipients who died after January 1, 2010 to recover costs for co-insurance paid under the QMB MSP program for services rendered after January 1, 2010. The federal government made this change in order to eliminate barriers to enrollment in MSPs. See NYS DOH GIS 10-MA-008 - Medicare Savings Program Changes in Estate Recovery The GIS clarifies that a client who receives both QMB and full Medicaid is exempt from estate recovery for these Medicare cost-sharing expenses.
Benefit 4. SNAP (Food Stamp) benefits not reduced despite increased income from MSP - at least temporarily
Many people receive both SNAP (Food Stamp) benefits and MSP. Income for purposes of SNAP/Food Stamps is reduced by a deduction for medical expenses, which includes payment of the Part B premium. Since approval for an MSP means that the client no longer pays for the Part B premium, his/her SNAP/Food Stamps income goes up, so their SNAP/Food Stamps go down. Here are some protections:
5. Enrolling in an MSP for people who have free Medicare Part A - Automatic enrollment & MSP applications
Some clients will be automatically enrolled in an MSP by the New York State Department of Health (NYSDOH) shortly after attaining eligibility for Medicare. Others need to apply. The 2010 "MIPPA" law introduced some improvements to increase MSP enrollment. See 3rd bullet below. Also, some people who had Medicaid through the Affordable Care Act before they became eligible for Medicare have special procedures to have their Part B premium paid before they enroll in an MSP. See below.
But if a Medicaid recipient does not have MSP, contact the Local Medicaid office and request that they be enrolled.
One who is only eligible for QI-1 because of higher income may ONLY apply for an MSP, not for Medicaid too. One may not receive Medicaid and QI-1 at the same time. If someone only eligible for QI-1 wants Medicaid, s/he may enroll in and deposit excess income into a pooled Supplemental Needs Trust, to bring her countable income down to the Medicaid level, which also qualifies him or her for QMB instead of QI-1.
Advocates in NYC can sign up for a half-day "Deputization Training" conducted by the Medicare Rights Center, at which you'll be trained and authorized to complete an MSP application and to submit it via the Medicare Rights Center, which submits it to HRA without the client having to apply in person.
6. Enrolling in MSP for People Age 65+ who do Not have Free Medicare Part A - the "Part A Buy-In Program"
Seniors WITHOUT MEDICARE PART A or B -- They may be able to enroll in the Part A Buy-In program, in which people eligible for QMB who are age 65+ who do not otherwise have Medicare Part A may enroll in Part A, with Medicaid paying the Part A premium.
8. QMBs -Special Rules on Cost-Sharing. QMB is the only MSP program which pays not only the Part B premium, but also the Medicare co-insurance. However, there are limitations. First, co-insurance will only be paid if the provide accepts Medicaid. Not all Medicare provides accept Medicaid. Second, under recent changes in New York law, Medicaid will not always pay the Medicare co-insurance, even to a Medicaid provider. But even if the provider does not accept Medicaid, or if Medicaid does not pay the full co-insurance, the provider is banned from "balance billing" the QMB beneficiary for the co-insurance. Click here for an article that explains all of these rules.
This article was authored by the Empire Justice Center.