LIS Fact Sheet
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Help Rural Americans in Medicare Strengthen the Part D Low-income Subsidy (LIS) and Medicare Savings Programs (MSP)
AARP Supports Legislation to Help People
With Limited Incomes with Medicare Drug Costs
S. 1102 and H.R. 1536 Would Raise the Asset-Test Limits
And Close the “Doughnut Hole” for More Low-Income Seniors
AARP is urging Congress to pass legislation raising asset limits for the Medicare
Part D low-income subsidy so more beneficiaries with limited incomes get help
paying for prescription drugs.
One of the Medicare drug benefit’s most important features is the extra help
provided to people with limited incomes. People eligible for the subsidy can get
greatly reduced co-payments, low or no premiums, and no “doughnut hole”
coverage gap.
Unfortunately, millions of older Americans who need this extra help do not qualify
because of a strict asset test. No individual with more than $11,990 in assets, or
couple with more than $23,970, is eligible.
This asset test is proving to be a serious barrier. It makes the application process
difficult and invasive, even for those who are under these limits.The asset test also harms older Americans, who, despite limited incomes, did the
right thing of saving a small nest egg for retirement.
AARP believes there should be no asset test in Medicare. We should encourage
people to save for retirement, not penalize those who do with an asset test.
Even those who did not oppose an asset test in Medicare’s drug plan agree that
current limits are far too low.
That is why AARP supports the Part D Equity for Low-Income Seniors Act of
2007 (S. 1102), introduced by Sens. Jeff Bingaman (D-N.M.) and GordonSmith (R-Ore.), and the Prescription Coverage Now Act (H.R. 1536), introduced
by Rep. Lloyd Doggett (D-Texas).
Both bills would help millions of seniors living on limited incomes by raising the
amount of assets someone can have to be eligible for the low-income subsidy to
$27,500 for individuals and $55,000 for couples. They also would streamline the
cumbersome application process and help target outreach efforts to enroll more
low-income beneficiaries in the program.
March 4, 2008
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