What LIS (Low-Income Subsidy) Does

LIS stands for Low-Income Subsidy, a federal program that helps people with limited income and resources pay for prescription drug coverage under Medicare Part D. If you may have access to, LIS covers most or all of your monthly premiums, deductibles, and copayments for drugs — meaning you may pay little to nothing when you fill a prescription.

LIS is also called "Extra Help" by Medicare. The program is automatic in some cases: if you receive Supplemental Security Income (SSI) or certain state information programs, Medicare may enroll you without you having to ask. In other cases, you need to request it.

The amount LIS covers depends on your income and resources. People with the lowest incomes pay nothing for premiums or copays. Those with slightly higher incomes pay a small share of the cost, but LIS still covers the bulk of it.

Key Takeaways

  • LIS pays most or all of your Medicare Part D drug premiums, deductibles, and copayments if your income and resources fall below the federal limits.
  • You are automatically enrolled in LIS if you receive SSI or certain state programs; otherwise you must request it through Social Security.
  • Income limits change each year, and in 2024 the monthly limit is roughly $1,550 for an individual and $2,100 for a married couple, though these figures vary.
  • You can request LIS at any time during the year, and coverage can start as early as the first day of the month after Social Security approves your request.
  • If your income or resources change, you should report the change to Social Security so your LIS amount stays correct.

Income and Resource Limits for LIS

To receive LIS, your monthly income must be at or below 150% of the federal poverty line. Your countable resources (savings, investments, property other than your home) must also be below a set limit. These limits change each year and differ for individuals, married couples, and families.

Income includes Social Security, pensions, wages, and some other sources. Social Security counts your gross income before taxes. Resources include bank accounts, stocks, and bonds, but not your home, car, or personal belongings. If you are married, Social Security counts both spouses' income and resources together, even if only one of you is on Medicare.

The exact dollar amounts vary by year. To find the current limits for your household size, contact Social Security at 1-800-772-1213 or visit ssa.gov. You can also ask your State Health Insurance information Program (SHIP), which offers free counseling about Medicare costs.

How to Request LIS

If you are not automatically enrolled, you can request LIS through Social Security. You have three options: call 1-800-772-1213, visit your local Social Security office in person, or explore online at ssa.gov/benefits/medicare/forms.html.

When you explore, have ready your Social Security number, proof of citizenship or legal residency, and recent documents showing your income and resources (pay stubs, bank statements, tax returns). Social Security will ask about your household size, monthly income, and savings.

After you explore, Social Security will mail you a notice saying whether you were approved and, if so, what your copayment amount will be. This notice also tells you which drug plan you are enrolled in if you do not already have one. The approval process usually takes two to four weeks.

What LIS Covers and What It Does Not

LIS covers your monthly Part D premium (the cost to join a drug plan), your annual deductible (the amount you pay before the plan starts paying), and your copayments or coinsurance when you fill a prescription. Depending on your income level, you may pay nothing for any of these, or you may pay a small copay per prescription.

LIS does not cover drugs that your Part D plan does not cover. It also does not cover Medicare Part A (hospital insurance) or Part B (doctor and outpatient care) premiums — those are handled by other programs like Medicaid or the Part B Income-Related Monthly Adjustment Amount (IRMAA). If you need help with Part A or B costs, ask your SHIP counselor or local Medicaid office.

LIS also does not pay for prescriptions filled outside the United States or for drugs purchased without a prescription. You must use a pharmacy in your Part D plan's network to get the full LIS benefit.

When Your LIS Coverage Starts and Stops

If Social Security approves your LIS request, coverage usually starts on the first day of the month after approval. For example, if you are approved in mid-March, your LIS coverage begins April 1. You do not have to wait for a new calendar year.

LIS continues as long as you remain on Medicare Part D and your income and resources stay below the limits. Each year in October and November, you should check whether your income or resources have changed. If they have, contact Social Security to report the change. If you do not report a change and your income rises above the limit, Social Security may ask you to repay some of the LIS money you received.

If you lose LIS because your income rose, you can request it again if your income drops back below the limit. There is no penalty for losing and regaining LIS.

How LIS Affects Your Drug Plan Choices

When you are enrolled in LIS, you are automatically placed in a Part D plan chosen by Medicare. This plan changes from year to year. You can switch to a different plan during the annual enrollment period (October 15 to December 7 each year) or if you have a may have access to life event like moving to a new state.

Because LIS covers most of your costs, the monthly premium of the plan matters less than it would without LIS. Instead, focus on whether the plan covers the drugs you take. Check the plan's formulary (list of covered drugs) on Medicare.gov or call the plan directly to confirm your medications are included.

If your current plan stops covering a drug you need, you can switch plans outside the annual enrollment period. Contact your plan or Medicare at 1-800-MEDICARE to ask about your options.

Reporting Changes and Keeping Your LIS Current

You must tell Social Security if your income, resources, household size, or living situation changes. Examples include a raise or job loss, an inheritance or large gift, a move to a nursing home, or the death of a spouse. Report changes within 30 days to avoid overpayments or loss of coverage.

You can report a change by calling Social Security at 1-800-772-1213, visiting a local office, or using the online portal at ssa.gov. Have your Social Security number and details of the change ready. Social Security will recalculate your LIS amount and send you a new notice.

Each year, Social Security sends a notice in the mail asking you to confirm your income and resources are still correct. Read this notice carefully and respond by the important date. If you do not respond, Social Security may stop your LIS.

Frequently Asked Questions

Can I get LIS if I am on Medicaid?

Yes. In fact, if you receive SSI or Medicaid, you are usually automatically enrolled in LIS without having to ask. Check your Social Security statement or call 1-800-772-1213 to confirm you are enrolled. If you are on Medicaid but not SSI, you can still request LIS separately if your income and resources meet the limits.

What happens if my income goes over the limit after I am approved?

Social Security will recalculate your LIS amount or stop your coverage. You are required to report income changes within 30 days. If you do not report and Social Security later finds out, you may have to repay some of the LIS benefit. If your income only slightly exceeds the limit, you may still receive some LIS help at a reduced level.

Can I switch Part D plans if I am on LIS?

Yes. You can switch during the annual enrollment period (October 15 to December 7) or if you have a may have access to life event such as moving, losing employer coverage, or a change in your health. Contact Medicare at 1-800-MEDICARE or your current plan to request a switch.

What if I am denied LIS?

Social Security will mail you a notice explaining why you were denied. Common reasons are income or resources above the limit. You can request reconsideration by contacting Social Security within 60 days of the denial notice. Bring documents proving your actual income and resources. If you disagree with the decision, you can appeal.

Does LIS cover brand-name drugs if a generic is available?

Your Part D plan decides which drugs it covers, and LIS pays the copay for covered drugs. If your plan covers only the generic version of a drug, LIS will cover that. If you need the brand-name drug, ask your doctor to request an exception from the plan. Some plans will cover the brand-name drug if your doctor says it is medically necessary.