Federal Subsidy Prescription Plan
With the insurance program in place, there are some questions on what federal subsidies are available to Medicare recipients. Few people will disagree that the insurance coverage is in itself the federal government subsidy program for the prescription drug costs of Medicare recipients.
For typical Medicare recipients, prescription drug plan enrollment is voluntary. But in the case of the 6.4 million dual eligibles, or those who qualify for both Medicare and Medicaid, they are automatically enrolled in a Medicare Part D plan.
They also have the option to change their Part D plans as often as once a month.
Few Medicare recipients, however, know that the Part D program actually offers “extra help” to people who are below the poverty line. This subsidy is also known as Part D from Medicare with Subsidy.
The Social Security Administration (SSA) is the government agency tasked to receive applications and determine the eligibility of applicants for the subsidy program. This subsidy invariably reduces the out-of-pocket expenses of enrollees in the Part D program who have limited incomes. The criteria for “limited income” is as follows:
» 150% below the poverty line applicable to the size of the enrollee’s family
» up to $11,710 worth of assets for individual enrollees
» up to $23,410 for married couples in 2007
Beneficiaries pay lower monthly premiums than other Part D enrollees. This subsidy also offers other cost-sharing benefits. Individuals wishing to apply for subsidy need to submit subsidy applications to the SSA. Low-income dual eligibles and individuals eligible for the Medicare Savings Programs are automatically eligible and do not have to submit an application.
Applicants for Low Income subsidy are entitled to Low Income Subsidy if: (a) they are eligible for Medicare Part A and/or currently enrolled in Medicare Part B, (b) Meet requirements on income and resource, (c) enrolled in a Medicare Advantage Plan or stand-alone Prescription Drug Plan.
After initial determination of eligibility for the subsidy, the SSA will periodically review the income and resources of recipients to verify their continued eligibility for the program.
In real-life applications, the SSA would look at an applicant’s income, ready resources, and real estate property to determine if he/she is eligible for the subsidy. A computer match on the database is used to verify the income level and resource information provided by the applicant during application. Changes in the applicant’s personal circumstances, like marriage or divorce, can affect the eligibility of the applicant or the amount of subsidy he/she can qualify for.
If you are refused subsidy, you can always appeal the decision of the SSA, since all subsidy eligibility determination by the SSA are subject to administrative review. You can appeal your case via a case review or telephone hearing. Decisions handed down by administrative review may be appealed at the federal courts.
The Centers for Medicare & Medicaid Services (CMS) first published its regulations on subsidy on January 1, 2005. Supplementary regulations, which outlined the SSA’s role in the Low Income Subsidy program, were published on December 30, 2005.
