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Correcting Low-Income Subsidy Status Based on Best Available Evidence (BAE)

Medicare uses data from states and Social Security to determine the level of Extra Help (also called the low-income subsidy) for which a person may qualify. This Extra Help can include assistance paying monthly premiums and may reduce or eliminate copayments. If Medicare doesn’t have the right information, its systems may show incorrect copayment levels, or they may not show that an eligible person qualifies for Extra Help. This discrepancy may happen when the state hasn’t successfully reported a person’s Medicaid or institutionalized status.

Medicare drug plan sponsors must use "Best Available Evidence" (BAE) to correct information about a person’s level of Extra Help. Once plans get BAE documentation, they can’t charge a person more than $3.40 for each generic drug (or brand-name drug treated as a generic) or $8.50 for any other brand-name drug (in 2019). Some people will pay a 15% coinsurance for drugs on their plan’s formulary. People with Medicaid who live in an institution (like a nursing home) shouldn’t need to pay for their covered drugs. Some people with higher incomes get partial Extra Help and pay reduced monthly premiums, deductibles, and copays.

If a person thinks they qualify for Extra Help because they have Medicaid, but they don’t have or can’t find the BAE documentation and ask for help, the plan must refer the person’s information to Medicare to confirm the person qualifies.



How to use BAE

You can help a person make sure he or she pays the right amount for his or her prescriptions. First, be sure the person has the following information available:
•   Name
•   Date of Birth
•   Medicare Health Insurance Claim Number

Then, simply follow these steps:
Step 1. Collect documentation that meets the definition of BAE (see the chart below).
Step 2 Send the BAE documentation to the plan.
Step 3 If the person can’t find or doesn’t have any BAE documentation, contact his or her plan and specifically ask for help getting the documentation.

Step 1: Collect BAE documentation

You can provide any of the following documents to plans to verify a person’s eligibility for Extra Help and help the plan correct the person’s low-income subsidy status or copayment level:
•   Automatic enrollment notice from Medicare on yellow or green paper
•   Notice from Medicare on purple paper that says the person automatically qualifies for Extra Help •   Notice from Medicare on orange paper that says the amount of the person’s copayment will change next year
•   Extra Help "Notice of Award" from Social Security
•   Other proof that the person qualifies for Extra Help, such as an award letter from Social Security which proves the person has Supplemental Security Income (SSI)

You can also provide any of the documents listed below as proof that the person qualifies for Extra Help.

Proof of Medicaid and Institutionalization

•   An invoice from the institution showing Medicaid payment for the person for at least a full calendar month
•   A copy of a state document that confirms Medicaid payment to the institution for the person for a full calendar month
•   A print-out from the state’s Medicaid systems showing the person’s institutional status for at least a full calendar month

Proof of Medicaid

•   A copy of the person’s Medicaid card that includes the person’s name and eligibility date
•   A copy of a state document that confirms active Medicaid status
•   A print-out from the state’s electronic enrollment file or from the state’s Medicaid systems showing Medicaid status
•   Other documentation provided by the State Medical Assistance (Medicaid) office showing Medicaid status


Step 2: Submit BAE documentation to the plan

Call the person’s plan or visit the plan’s Web site to find out where to mail or fax the documents, or to see if they can be sent by e-mail.

As soon as the plan gets any one of the BAE documents, it must make sure the person pays no more than $3.40 for each generic drug (or brand-name drug treated as a generic) or $8.50 for any other brand-name drug (in 2019). If the documents also verify the person has Medicaid and lives in an institution, the plan must make sure the person pays nothing for their prescription drugs.

The plan must also work with Medicare to correct the discrepancy in their systems. Until the problem is corrected, the plan must make sure the person continues to be charged only the corrected cost-sharing amounts without having to resubmit documentation each month.


Step 3: Contact the plan for more help

If a person can’t locate any of the documents listed above as proof of their Medicaid or institutional status, contact the plan and ask for help getting the documentation. The plan will refer the person’s information to Medicare to verify his or her status. When you contact the plan, be sure to tell them how many days of medication he or she has left. The plan will include this information in its request to Medicare so Medicare can respond before he or she runs out of medication, if possible. The plan generally must refer requests to Medicare within 1 business day of getting them. Once Medicare responds, the plan must attempt to notify him or her of the results within 1 business day. The request will take anywhere from several days to up to 2¬†weeks to process, depending on the circumstances, including the urgency of his or her needs for medication.


If the plan won’t fix the problem

File a complaint with Medicare if the plan does any of the following:

•   Doesn’t correct a problem to make sure the person pays the right amount
•   Doesn’t work with you to help get proof of Medicaid or institutional status
•   Fails to respond within normal timeframes

To file a complaint, call 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048.


How a person can get costs back if they have been paying too much

If a person wasn’t already enrolled in a Medicare drug plan and paid for prescriptions since they qualified for Extra Help, they may be able to get back a part of what they paid. They should try to locate their receipts. Then, they should call their plan or Medicare’s Limited Income Newly Eligible Transition (NET) Program at 1-800-783-1307. TTY users should call 1-877-801-0369.

Also see: CMS Guide to LIS Mailings for details on these and other mailings

If you receive the full Extra-Help, full LIS, or are dual eligible for Medicare and Medicaid, there are Medicare Prescription Drug plans in your state the will qualify for the $0 monthly premium. Click on your state below to see PDP plans that qualify for the $0 premium:
AK  AL  AR  AZ  CA  CO  CT  DC  DE  FL  GA  HI  IA  ID  IL  IN  KS  KY  LA  MA  MD  ME  MI  MN  MO  MS  MT  NC  ND  NE  NH  NJ  NM  NV  NY  OH  OK  OR  PA  PR  RI  SC  SD  TN  TX  UT  VA  VT  WA  WI  WV  WY 
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Tips & Disclaimers
  • The Medicare Advantage and Medicare Part D prescription drug plan data on our site comes directly from Medicare and is subject to change.
  • Medicare has neither reviewed nor endorsed the information on our site.
  • We provide our Q1Medicare.com site for educational purposes and strive to present unbiased and accurate information. However, Q1Medicare is not intended as a substitute for your lawyer, doctor, healthcare provider, financial advisor, or pharmacist. For more information on your Medicare coverage, please be sure to seek legal, medical, pharmaceutical, or financial advice from a licensed professional or telephone Medicare at 1-800-633-4227.
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  • When enrolling in a Medicare Advantage plan, you must continue to pay your Medicare Part B premium.
  • Medicare beneficiaries with higher incomes may be required to pay both a Medicare Part B and Medicare Part D Income Related Monthly Adjustment Amount (IRMAA). Read more on IRMAA.
  • Medicare Advantage plans that include prescription drug coverage (MAPDs) are considered Medicare Part D plans and members with higher incomes may be subject to the Medicare Part D Income Related Monthly Adjustment Amount (IRMAA), just as members in stand-alone Part D plans. In certain situations, you can appeal IRMAA.
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  • If you are enrolled in a Medicare plan with Part D prescription drug coverage, you may be eligible for financial Extra Help to assist with the payment of your prescription drug premiums and drug purchases. To see if you qualify for Extra Help, call: 1-800-MEDICARE (1-800-633-4227). TTY users should call 1-877-486-2048, 24 hours a day/ 7 days a week or consult www.medicare.gov; the Social Security Office at 1-800-772-1213 between 7 a.m. and 7 p.m., Monday through Friday. TTY users should call, 1-800-325-0778; or your state Medicaid Office.
  • Medicare evaluates plans based on a 5-Star rating system. Star Ratings are calculated each year and may change from one year to the next.
  • A Medicare Advantage Private Fee-for-Service plan (PFFS) is not a Medicare supplement plan. Providers who do not contract with the plan are not required to see you except in an emergency.
  • Disclaimer for Institutional Special Needs Plan (SNP): This plan is available to anyone with Medicare who meets the Skilled Nursing Facility (SNF) level of care and resides in a nursing home.
  • Disclaimer for Dual Eligible (Medicare/Medicaid) Special Needs Plan (SNP): This plan is available to anyone who has both Medical Assistance from the State and Medicare. Premiums, co-pays, co-insurance, and deductibles may vary based on the level of Extra Help you receive. Please contact the plan for further details.
  • Disclaimer for Chronic Condition Special Needs Plan (SNP): This plan is available to anyone with Medicare who has been diagnosed with the plan specific Chronic Condition.
  • Medicare MSA Plans combine a high deductible Medicare Advantage Plan and a trust or custodial savings account (as defined and/or approved by the IRS). The plan deposits money from Medicare into the account. You can use this money to pay for your health care costs, but only Medicare-covered expenses count toward your deductible. The amount deposited is usually less than your deductible amount, so you generally have to pay out-of-pocket before your coverage begins.
  • Medicare MSA Plans do not cover prescription drugs. If you join a Medicare MSA Plan, you can also join any separate (stand-alone) Medicare Part D prescription drug plan
  • There are additional restrictions to join an MSA plan, and enrollment is generally for a full calendar year unless you meet certain exceptions. Those who disenroll during the calendar year will owe a portion of the account deposit back to the plan. Contact the plan provider for additional information.
  • Medicare beneficiaries may enroll through the CMS Medicare Online Enrollment Center located at www.medicare.gov.
  • Medicare beneficiaries can file a complaint with the Centers for Medicare & Medicaid Services by calling 1-800-MEDICARE 24 hours a day/7 days or using the medicare.gov site. Beneficiaries can appoint a representative by submitting CMS Form-1696.