Financial advisors often work with clients who struggle to manage health care costs in retirement.
Many retirees can earn too much to qualify for Medicaid but still face financial strain from Medicare premiums, deductibles and copayments.
Recently, one of our clients, Susan, a retired teacher, asked us whether she could get help covering her $185 monthly Medicare Part B premium.
She receives $1,700 per month from Social Security and a small pension — too much to qualify for Medicaid, yet still not enough to comfortably cover her health care expenses.
Susan wondered if there was any financial relief available.
After reviewing her situation, we determined that she might qualify for the Medicare Savings Program, or MSP, which helps eligible beneficiaries cover Medicare costs.
For clients like Susan, understanding and enrolling in MSP can provide meaningful financial relief.
What Is MSP?
The MSP is a government program that provides four levels of assistance, each with specific income and asset limits.
These levels are:
Qualified Medicare Beneficiary (QMB) Program: Covers Medicare Part A and Part B premiums, deductibles, copayments and coinsurance.
Specified Low-Income Medicare Beneficiary (SLMB) Program: Pays Part B premiums.
Qualifying Individual (QI) Program: Also covers Part B premiums but has limited funding and requires annual reapplication.
Qualified Disabled and Working Individuals (QDWI) Program: Helps certain working individuals under 65 with disabilities by covering Part A premiums.
In 2025, the federal income limits for MSPs range from 100% to 135% of the federal poverty level, or FPL. For an individual in most of the country, this equates to monthly income limits between $1,255 and $1,660.
However, some states have higher limits or have eliminated asset tests.
Could Susan Qualify?
Since Susan's $1,700 monthly income slightly exceeds the federal QI Program threshold, she might not qualify under federal guidelines.
However, some states adjust income calculations, excluding certain sources like Social Security cost-of-living adjustments or pension income.
If Susan lives in a state with higher limits or no asset test, she may still be eligible to have her Part B premium covered through MSP.
What should an advisor do in this situation?
The process of evaluating eligibility includes:
◆ Checking state-specific MSP eligibility rules.
◆ Helping gather necessary documents, including income proof and her Medicare card.
◆ Assisting in submitting an application through the state Medicaid office, since enrollment is open year-round.
Flexibility and Financial Relief
The Medicare Advantage plan and Medicare Part D prescription drug plan programs limit most clients to applying during an annual enrollment period.
For MSP, clients can apply at any time of the year. This is important for clients whose financial situations change due to medical bills, loss of income or other life events.
Since eligibility is reviewed periodically, advisors should encourage clients to reapply if state guidelines change or their financial status shifts.
Helping clients enroll in MSP can offer significant financial relief:
Lower health care costs: The program can save a client up to $185 per month in 2025.
Preserved retirement savings: The savings may help a client avoid premature withdrawals from annuities or other arrangements.
Better access to care: By shielding a client against bills for deductibles and coinsurance amounts, QMB status can eliminate Medicare cost-sharing obstacles, increasing the odds that the client will get needed medical treatment.
How Advisors Can Help
Despite its benefits, many eligible clients don't know about MSP.
Financial advisors can assist by:
◆ Reviewing income and asset eligibility based on state guidelines.
◆ Helping gather documentation, such as income proof, bank statements and Medicare card details.
◆ Guiding clients through the application process, which is usually handled by state Medicaid offices.
Advisors should stay updated on Medicare and Medicaid policy changes, as the changes can affect program eligibility and benefits.
Tricia Blazier, JD, is director of Healthcare Insurance Services at Allsup.
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