Medicare Cost-Saving Programs

The cost of health care across the country has risen continuously, with many seeing a sharp increase in premiums and other out-of-pocket costs in 2026. Medicare is no exception. Higher Part B premiums—exceeding $200/month for the first time—are likely to worsen financial strain for many beneficiaries.

There are certain cost-assistance programs, each with their own eligibility requirements and benefits, that may ease the burden and make it less difficult to afford Medicare while budgeting for other necessities. Of course, no number of cost-saving programs, no matter how accessible or comprehensive, can solve the problem of a health care system whose costs are unsustainable at the root. But if you are struggling to afford care, it is worth the time to learn about and check your eligibility for these programs.

Medicare Savings Programs are available for people with Medicare who have limited income and savings. If you apply for an MSP and are deemed eligible, you will be enrolled in one of three main programs based on your income, assets, and other information provided in your application. The three MSPs have different requirements and benefits, but all of them cover the Part B premium, including any Part B late enrollment penalties, and offers automatic enrollment into Extra Help, which helps pay Part D costs.

Extra Help, or the Part D Low-Income Subsidy, helps individuals pay for out-of-pocket Part D costs and eliminates the Part D late enrollment penalty. With Extra Help, you may change your standalone Part D plan as often as once a month through a Special Enrollment Period. For a more detailed overview of Extra Help, check out our recent video and article on Part D cost assistance.

State Pharmaceutical Assistance Programs are offered by many states to help cover prescription drug costs. Each program has different eligibility requirements and benefits, and you may qualify based on income, age, HIV or disability status, or other factors that vary by state and program. An SPAP may require that you are enrolled in Part D so that it can coordinate benefits with Medicare or offer Medicare-specific benefits, like Special Enrollment Periods.

Medicaid can coordinate with Medicare in various ways for beneficiaries who are eligible for both programs. It can function as a secondary insurance, further lowering costs for care from providers enrolled with both Medicare and Medicaid. In many instances, having both Medicare and Medicaid will automatically enroll you in an MSP, eliminating certain premiums and penalties as well as dramatically reducing cost sharing. Medicaid may also cover services Medicare does not, including routine dental care, long-term supports and services, and non-emergency medical transportation.

The National Council on Aging’s free, online BenefitsCheckUp tool can help you find assistance programs in your area and determine your eligibility. The tool can connect you to benefits not only relevant to Medicare and health care coverage but also food assistance, transportation, disability services, and more.

Policy Directions in Health Care Affordability

In the U.S., nearly half of adults say it is difficult for them to afford their health care costs, and over one-third of adults skipped or postponed care in the past year due to concerns that they would not be able to pay. Half of all Medicare beneficiaries live on less than $30,000 a year. At the same time, less than 60% of Medicare beneficiaries eligible for a Medicare Savings Program—where income thresholds are already exceedingly low—are enrolled, due to accessibility barriers and excessive red tape. There is a dire need for better and more accessible cost-saving programs to serve a greater number of people.

The Medicare Rights Center supports policies that expand the breadth and accessibility of cost-saving programs for people with Medicare and/or Medicaid. In case studies focusing on the challenges dual-eligible beneficiaries experience, we have observed room for improvement in Medicare’s integration with Medicaid and MSPs, including unnecessarily complex application and recertification processes that contribute to beneficiary churn and underenrollment.

For further help with enrolling in an MSP or other cost-assistance programs, you can call the Medicare Rights national helpline at 800-333-4114, or reach out to your State Health Insurance Assistance Program.