Medicare Savings Programs 2026: Asset Limits and Covered Costs by Level

QMB vs SLMB vs QI: Which Program Pays What in 2026

Medicare Savings Programs are federal-state programs that help low-income Medicare beneficiaries pay for Part A and Part B premiums, deductibles, and coinsurance. For 2026, eligibility is determined by income and asset limits set at $9,950 for individuals and $14,910 for married couples.¹

The Qualified Medicare Beneficiary (QMB) program provides the most comprehensive coverage. It pays Medicare Part B premiums, Part A premiums (if applicable), all Part A and Part B deductibles, and coinsurance amounts.² With the Part B standard premium at $185/month in 2026, QMB enrollment saves a beneficiary $2,220 annually in premiums alone. The program also eliminates the $257 Part B deductible and 20% coinsurance on services.

The Specified Low-Income Medicare Beneficiary (SLMB) program covers only the Part B premium. It does not pay deductibles or coinsurance. The Qualifying Individual (QI) program is identical in coverage to SLMB — it pays only the Part B premium — but requires annual reapplication because funding is capped by Congress.²

The income thresholds determine which program applies. QMB requires income at or below 100% of the Federal Poverty Level. SLMB covers those between 100% and 120% of FPL. QI covers those between 120% and 135% of FPL.

2026 Asset Limits and What Counts Toward the $9,950/$14,910 Threshold

The federal asset limit for MSP eligibility in 2026 is $9,950 for an individual and $14,910 for a married couple.¹ These limits apply to countable assets — cash, checking and savings accounts, stocks, bonds, mutual funds, and certificates of deposit.

Not all assets count toward the limit. Your primary home, one vehicle, household goods, personal effects, and burial plots are excluded. Life insurance policies with a face value under $1,500 are also excluded.² However, retirement accounts like IRAs and 401(k)s are treated differently by state — some count them as assets, others do not.

Consider a hypothetical beneficiary named Sarah who has $8,000 in a savings account, a car worth $12,000, and a home valued at $200,000. Her countable assets are $8,000 — well under the $9,950 limit — because the car and home are excluded. If she also had $5,000 in a brokerage account, her countable assets would rise to $13,000, exceeding the individual limit.

Assets held as annuities may affect eligibility differently than savings accounts. Some states exclude annuities that are irrevocable or structured as income streams, while others count the cash surrender value. This distinction matters for beneficiaries who converted savings into annuities before applying for MSP.

How MSP Enrollment Triggers Income Reporting That Affects Future IRMAA

Enrolling in an MSP does not directly trigger Income-Related Monthly Adjustment Amount (IRMAA) surcharges. However, the income reporting process can create complications. When you apply for MSP, states verify your income through data matches with the Social Security Administration and IRS. If your reported income changes year to year, the state may reassess your eligibility.

IRMAA surcharges in 2026 apply to individuals with modified adjusted gross income (MAGI) over $109,000 and married couples over $218,000.³ MSP beneficiaries typically have income well below these thresholds, so IRMAA is rarely a concern during active MSP enrollment.

A beneficiary who receives a one-time distribution from a retirement account — for example, a $50,000 IRA withdrawal — could see their MAGI spike above the IRMAA threshold in a single year. The two-year lookback rule means a 2026 IRMAA determination uses 2024 tax return data. If an MSP beneficiary had a high-income year in 2024 due to a Roth conversion or capital gain, they could face IRMAA surcharges in 2026 even if their current income is low.

Filing an IRMAA appeal using Form SSA-44 with documentation of a life-changing event — retirement, divorce, or loss of income — can reverse the surcharge.

Hidden Enrollment Traps That Cause Beneficiaries to Lose Coverage Unnecessarily

The most common trap is failing to renew QI coverage annually. Unlike QMB and SLMB, which are entitlement programs, QI has limited federal funding distributed on a first-come, first-served basis. Beneficiaries who do not reapply each year lose coverage and must wait until the next funding cycle.²

Another trap involves asset transfers. Suppose a beneficiary gives $5,000 to a family member to qualify for MSP. Some states impose a lookback period for asset transfers, similar to Medicaid rules. If the transfer is discovered during the eligibility review, the beneficiary may be disqualified or face a penalty period.

A third trap is the interaction between MSP and Medicare Part D Low-Income Subsidy (LIS). QMB enrollees are automatically deemed eligible for LIS, which provides Part D premium and cost-sharing assistance. But if a beneficiary loses QMB status due to income changes, they may also lose LIS without realizing it, leading to higher prescription drug costs.

Finally, beneficiaries who move to a new state must reapply for MSP. The new state may have different asset counting rules or income disregards, potentially causing a gap in coverage. A beneficiary moving from a state with generous asset exclusions to one with stricter rules could lose eligibility entirely.

State Variation: When Your State's Limits Are Kinder Than Federal Standards

While federal law sets the minimum asset limit at $9,950 for individuals and $14,910 for couples, states have the option to use higher limits or eliminate asset tests entirely.¹ Approximately 20 states and Washington D.C. have no asset test for MSP eligibility as of 2026. In these states, beneficiaries qualify based on income alone.

States that have eliminated the asset test include California, New York, Massachusetts, Connecticut, and Ohio. In these states, a beneficiary with $50,000 in savings could still qualify for QMB if their income is below 100% of FPL.² This is a significant advantage for retirees who have modest savings but low monthly income.

Other states use the federal limits but apply more generous income disregards. Some states deduct a standard amount from gross income before applying the FPL threshold, effectively raising the income limit. A few states also exclude certain types of income, such as veterans' benefits or workers' compensation, from the income calculation.

Beneficiaries should check their state's Medicaid agency website for specific rules. The Medicare Rights Center publishes a state-by-state guide to MSP eligibility that is updated annually.

How to Apply: Documents Needed and Which Office Handles MSP in Your State

MSP applications are processed by your state's Medicaid agency, not by Social Security or Medicare. Each state has a different name for this office — in California it's Medi-Cal, in New York it's the Department of Social Services, in Texas it's the Health and Human Services Commission.

The documents you need include proof of Medicare enrollment (your red, white, and blue Medicare card), proof of income (Social Security award letter, pension statements, tax returns), proof of assets (bank statements, investment account statements, retirement account statements), and proof of residency (driver's license, utility bill, lease agreement).

Most states allow online applications through their Medicaid portal. Some states also accept applications by mail or in person at a local office. The application process typically takes 30 to 45 days, though some states process applications faster for QMB due to its higher priority status.

If your application is denied, you have the right to appeal. The denial letter will explain the reason and provide instructions for filing an appeal. Common reasons for denial include exceeding asset limits, failing to provide required documents, or income above the threshold after disregards.

What MSP Does Not Cover and Why You May Still Need a Medicare Supplement Plan

MSP programs cover Medicare Part A and Part B premiums, deductibles, and coinsurance. However, they do not cover Part D prescription drug costs, dental care, vision care, hearing aids, or long-term care. QMB enrollees receive automatic LIS for Part D, which covers most prescription costs. Other MSP levels do not include drug coverage.

For SLMB and QI beneficiaries, the gap in coverage is significant. While their Part B premium is paid, they still face the Part B deductible and 20% coinsurance on services.²

A Medicare Supplement (Medigap) plan can fill these gaps, but Medigap policies have their own premiums. For a beneficiary already receiving MSP assistance, paying a Medigap premium may not be feasible. However, some states offer MSP Plus or similar programs that provide additional cost-sharing assistance beyond the standard MSP levels.

Beneficiaries should also consider Medicare Advantage plans, which often have lower out-of-pocket costs than Original Medicare. QMB enrollees can enroll in a Medicare Advantage plan, and the plan must accept QMB cost-sharing protections. Not all Medicare Advantage plans are available in all areas, and network restrictions may limit provider choice.

Your Next Step

Download the Medicare Savings Program application form from your state's Medicaid agency website. Gather your most recent bank statements, Social Security award letter, and tax return. Complete the application and submit it online or by mail.

If you are unsure which MSP level applies to your situation, call your State Health Insurance Assistance Program (SHIP) at 1-877-839-2675 for free, unbiased counseling. Do not wait — MSP coverage can save you thousands of dollars in 2026 premiums and out-of-pocket costs.