Cuts to Medicare Prescription Drug Assistance Will Cost Lives

A lesser-known impact of the “One Big Beautiful Bill” is the loss of vital prescription drug assistance for millions of low-income Medicare beneficiaries.

The Low-Income Subsidy (LIS) program – also known as Medicare Part D “Extra Help” – lowers monthly premiums, deductibles, and copays for low-income people on Medicare. The program, administered by the Social Security Administration, reduces the unaffordable out-of-pocket costs that so many seniors face when they go to get the medications they need. There are 14 million Medicare beneficiaries who receive LIS Extra Help, the majority of whom are dually eligible for Medicaid and Medicare.

A jarring new study in the New England Journal of Medicine estimates that the Medicaid coverage losses written into the current reconciliation bill could result in 18,200 additional deaths among Medicare enrollees every year. That is because when these thousands of mainly older Americans are forced to disenroll from Medicaid, they will automatically lose access to the Extra Help program. Technically they can reapply through other eligibility criteria, but it is harder and many likely won’t do it or won’t meet eligibility requirements.

The average Extra Help enrollee receives $6,200 in assistance a year through the program’s payments towards Medicare Part D costs. This assistance goes to people who make less than$23,475 a year if single or $31,725 a year with a spouse (those at or below 150 percent of the poverty level).

As of January 1, 2025, all Medicare Part D plans have an out-of-pocket annual cap of $2,000. For Extra Help program beneficiaries, those who make up to 100 percent of the poverty level pay no more than $1.60 for each generic drug and $4.80 for each brand-name drug, and those making between 100 percent and 150 percent of the federal poverty level pay $4.90 for generics and $12.15 for brand-name. Both tiers will stop paying once their total out-of-pocket drug copays reach $2,000. Meanwhile, the maximum deductible for those on Extra Help is $590.

However, if current low-income seniors using Extra Help are kicked off the program when they are disenrolled from Medicaid – as will happen if the current reconciliation bill passes – none of these benefits will be there for them.

The loss of prescription drug assistance may be a matter of life or death, as it can determine whether someone calls in a prescription for a life-saving medication. Nine of 10 Medicare beneficiaries report taking prescription drugs regularly.

Access to affordable healthcare coverage is already a great struggle for older Americans. If Medicaid cuts in the current GOP bill go through as proposed, the well-being of thousands of people on the Low-Income Subsidy program is at risk. This is needless suffering that can be prevented.

This first appeared on CEPR.

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