Medicare Part D

Extra Help in 2026: Cut Part D Costs If You Qualify

# Lowering Medicare prescription costs through the Low-Income…

LAREDO, Texas — If prescription drug costs are stretching your budget, Medicare has a program that could ease the pressure. It’s called Extra Help — also known as the Low-Income Subsidy, or LIS — and it can dramatically lower what you pay for Part D drug coverage. Many people who qualify don’t know it, so they never apply.

Here's a plain-language guide to how Extra Help works for 2027, who qualifies, and the common mistakes to avoid when signing up.

What Extra Help actually does

Extra Help is a federal program run by Social Security and Medicare that pays part of your Part D drug plan costs. If you qualify, it can lower or eliminate your Part D premium, reduce your deductible, and cap what you pay at the pharmacy counter to small set amounts per prescription.

Because the coverage gap (the old "donut hole") was eliminated in 2025, Part D now has three simpler phases: deductible, initial coverage, and catastrophic coverage. No one on Part D pays more than $2,100 out of pocket for covered drugs in 2026, or more than $2,400 in 2027. Extra Help sits on top of that structure, pushing costs down even further for people who qualify.

Who qualifies for 2027

Extra Help is based on income and resources, not age or health. Social Security updates the limits each year, and the program was expanded in 2024 so that everyone who qualifies now gets the full benefit (the old “partial” tier is gone).

In general terms:

• Income: Roughly at or below 150% of the federal poverty level. That’s adjusted yearly and is higher in some situations, such as if you support other family members.
• Resources: Things like money in checking, savings, stocks, and bonds. Your home, one car, personal belongings, and burial funds up to a set limit do not count.

You may automatically get Extra Help if you have both Medicare and Medicaid, get help from a Medicare Savings Program, or receive Supplemental Security Income (SSI). If you’re not automatic, you can still apply — and you should, even if you’re not sure you qualify. Social Security makes the final decision.

How to apply (and mistakes to avoid)

You can apply for Extra Help for free, any time of year, in three ways:

• Online at ssa.gov/extrahelp
• By calling Social Security at 1-800-772-1213 (TTY 1-800-325-0778)
• In person at your local Social Security office

Common mistakes we see readers make:

• Assuming they earn too much. The income and resource limits are higher than many people expect. Apply first, then let Social Security decide.
• Confusing Extra Help with a Medicare Savings Program (MSP). MSPs help pay Part B costs and are run by your state Medicaid office. Extra Help is for Part D drug costs. Many people qualify for both — apply for each.
• Not enrolling in a Part D plan after getting approved. Extra Help only reduces costs if you’re actually enrolled in a Part D drug plan (either stand-alone or built into a Medicare Advantage plan with drug coverage).
• Ignoring the annual review letter. Social Security sometimes asks you to confirm your income. If you get a purple, yellow, orange, or green notice, don’t toss it — respond by the deadline.

What this looks like in Laredo

Laredo is in Webb County, where Medicare beneficiaries can choose from stand-alone Part D drug plans and Medicare Advantage plans that include drug coverage. Plan availability is set at the county level by the Centers for Medicare & Medicaid Services (CMS), and options change each year.

You do not need to pick a special plan to use Extra Help — the subsidy works with any Part D plan you enroll in. If your current plan isn’t a good fit once Extra Help is approved, you generally get a special enrollment opportunity to switch, separate from the regular Annual Enrollment Period (October 15 – December 7).

Other ways to smooth out drug costs

Even if you don’t qualify for Extra Help, there are still tools that can help:

• The Medicare Prescription Payment Plan lets you spread your out-of-pocket Part D costs into monthly payments across the year instead of paying large amounts at the pharmacy at once. It’s optional and free to opt into through your drug plan.
• The annual out-of-pocket cap on covered Part D drugs applies to everyone with Part D — $2,100 in 2026 and $2,400 in 2027, no application needed.
• The maximum Part D deductible is a ceiling — $615 in 2026 and $700 in 2027 — and some plans set theirs lower.

For higher earners, keep in mind that IRMAA surcharges on Part B and Part D begin above $109,000 in income for a single filer in 2026. That’s a separate issue from Extra Help, but worth knowing if your income changes year to year.

Where to get trustworthy help

You never have to figure this out alone, and you never have to pay someone to apply.

• Medicare: 1-800-MEDICARE (1-800-633-4227) or medicare.gov
• Social Security (Extra Help applications): 1-800-772-1213 or ssa.gov/extrahelp
• Texas SHIP / HICAP: free, unbiased Medicare counseling for Laredo and Webb County residents. Find your local counselor through the Texas Health and Human Services Commission or by calling 1-800-252-9240.