Medicare Savings Program (MSP)

Revised date
Purpose statement

To describe programs to help individuals pay for Medicare premiums, deductibles, coinsurance charges, and copayments.

WAC 182-517-0100 Federal medicare savings programs.

WAC 182-517-0100 Federal medicare savings programs.

Effective January 19, 2026

  1. Available programs. The medicaid agency offers eligible clients the following medicare savings programs (MSPs):
    1. The qualified medicare beneficiary (QMB) program;
    2. The specified low-income medicare beneficiary (SLMB) program;
    3. The qualified individual (QI-1) program; and
    4. The qualified disabled and working individuals (QDWI) program.
  2. Eligibility requirements.
    1. To be eligible for an MSP, a client must:
      1. Be entitled to medicare Part A; or
      2. Be eligible for and enrolled in the medicare Part D low-income subsidy (LIS) program through the social security administration (SSA); and
      3. Meet the general eligibility requirements under WAC 182-503-0505.
    2. To be eligible for QDWI, a client must be under age 65.
    3. Income limits.
      1. Income limits for all MSPs are found at www.hca.wa.gov/free-or-low-cost-health-care/i-help-others-apply-and-access-apple-health/program-standard-income-and-resources.
      2. If a client's countable income is less than or equal to 110 percent of the federal poverty level (FPL), the client is income eligible for the QMB program.
      3. If a client's countable income is over 110 percent of the FPL, but does not exceed 120 percent of the FPL, the client is income eligible for the SLMB program.
      4. If a client's countable income is over 120 percent of the FPL, but does not exceed 138 percent of the FPL, the client is income eligible for the QI-1 program.
      5. If a client's countable income is over 138 percent of the FPL, but does not exceed 200 percent of the FPL, the client is income eligible for the QDWI program if the client is employed and meets disability requirements described in WAC 182-512-0050.
    4. The federal MSPs do not require a resource test.
  3. MSP income eligibility determinations.
    1. The agency has three methods for determining if a client is eligible for an MSP:
      1. The agency first determines if the client is eligible based on SSI-related methodologies under chapter 182-512 WAC. Under this method, the agency calculates the household's net countable income and compares the result to the one-person standard. However, if the spouse's income is deemed to the client, or if both spouses are applying, the household's net countable income is compared to the two-person standard.
      2. If the client is not eligible under the methodology described in (a)(i) of this subsection, the agency compares the same countable income, as determined under (a)(i) of this subsection, to the appropriate FPL standard based on family size. The number of individuals that count for family size include:
        1. The client;
        2. The client's spouse who lives with the client;
        3. The client's dependents who live with the client;
        4. The spouse's dependents who live with the spouse, if the spouse lives with the client; and
        5. Any unborn children of the client, or of the spouse if the spouse lives with the client.
      3. The third method for determining if a client is eligible for an MSP is the SSA LIS methodology. This is based on the client's application for the medicare Part D low-income subsidy program through the SSA, which the agency receives from SSA through the LIS data file. Under this methodology, the agency compares the LIS data file regarding income and household size to the current MSP standards.
    2. Under all eligibility determinations, the agency follows the rules for SSI-related people under chapter 182-512 WAC for determining
      1. Countable income;
      2. Availability of income;
      3. Allowable income deductions and exclusions; and
      4. Deemed income from and allocated income to a nonapplying spouse and dependents.
    3. The agency uses the eligibility determination that provides the client with the highest level of coverage.
      1. If the MSP applicant is eligible for QMB coverage under (a)(i) of this subsection, the agency approves the coverage.
      2. If the MSP applicant is not eligible for QMB coverage, the agency determines if the applicant is eligible under (a)(ii) of this subsection.
      3. If neither eligibility determination results in QMB coverage, the agency uses the same process to determine if the client is eligible under any other MSP.
    4. When calculating income under this section:
      1. The agency subtracts client participation from a long-term care client's countable income under WAC 182-513-1380, 182-515-1509, or 182-515-1514.
      2. The agency counts the annual Social Security cost-of-living increase beginning April 1st each year.
  4. Covered costs.
    1. The QMB program pays:
      1. Medicare Part A and Part B premiums using the start date in WAC 182-504-0025; and
      2. Medicare coinsurance, copayments, and deductibles for Part A, Part B, and Part C, subject to the limitations in WAC 182-502-0110.
    2. If the client is eligible for both SLMB and another medicaid program:
      1. The SLMB program pays the Part B premiums using the start date in WAC 182-504-0025; and
      2. The medicaid program pays medicare coinsurance, copayments, and deductibles for Part A, Part B, and Part C subject to the limitations in WAC 182-502-0110.
    3. If the client is only eligible for SLMB, the SLMB program covers medicare Part B premiums using the start date in WAC 182-504-0025.
    4. The QI-1 program pays medicare Part B premiums using the start date in WAC 182-504-0025 until the agency's federal funding allotment is spent. The agency resumes QI-1 benefit payments the beginning of the next calendar year.
    5. The QDWI program covers medicare Part A premiums using the start date in WAC 182-504-0025.
  5. MSP eligibility. Medicaid eligibility may affect MSP eligibility:
    1. QMB and SLMB clients may receive medicaid and still be eligible to receive QMB or SLMB benefits.
    2. QI-1 and QDWI clients who begin receiving medicaid are no longer eligible for QI-1 or QDWI benefits, but may be eligible for the state-funded medicare buy-in program under WAC 182-517-0300.
  6. Right to request administrative hearing. A person who disagrees with agency action under this section may request an administrative hearing under chapter 182-526 WAC.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

WAC 182-517-0300 State-funded medicare buy-in programs

WAC 182-517-0300 State-funded medicare buy-in programs.

Effective July 23, 2016

  1. A person is eligible for the state-funded medicare buy-in program if the person:
    1. Is entitled to or receiving medicare;
    2. Is not eligible for a federal medicare savings program under WAC 182-517-0100; and
    3. Is eligible for coverage under:
      1. The categorically needy (CN) program; or
      2. The medically needy (MN) program;
  2. The SBIP begins the second month after the month a person meets eligibility requirements.
  3. The SBIP pays only medicare Part B premiums.
  4. The agency pays medicare deductibles and coinsurance under WAC 182-502-0110.
  5. A person who disagrees with agency action under this section may request an administrative hearing under chapter 182-526 WAC.

This is a reprint of the official rule as published by the Office of the Code Reviser. If there are previous versions of this rule, they can be found using the Legislative Search page.

Clarifying information

How does someone apply or recertify for Medicare Savings Programs (MSP)?

  • A person applying or reapplying for MSP can apply:
    • Online at Washington Connection;
    • Call the Customer Service Contact Center at 877-501-2233;
    • Submit a paper HCA 13-691 Application for Medicare Savings Program (wa.gov); or
    • Submit Form HCA 18-005 Application for aged, blind, disabled/long-term if applying full Medicaid coverage (wa.gov).
  • MSP applications can also be initiated at SSA; when a person completes an application for Medicare Part D Low-Income Subsidy (LIS) benefits. These applications are sent electronically by SSA directly to ACES for auto-screening into ACES without requiring a separate MSP application.
  • An interview is not required.
  • Individuals receiving SSI (S01) and MSP do not need to reapply or be recertified unless their SSI benefits end.
  • Individuals who are currently on a CN program and become Medicare eligible should have MSP added whenever discovered. Treat this situation as a change of circumstances and process without an application. Applicants with other health insurance coverage need to complete a DSHS Third Party Liability 14-194 form. For more information refer to the Coordination of benefits | Washington State Health Care Authority.
  • See the Medicare Savings Programs reference guide for a useful overview of the programs discussed in this section.

How a client is determined eligible for a Medicare Savings Program

  • Eligibility for an MSP follows SSI-related rules described in Chapter 182-512 WAC with limited exceptions.
    • For MSP, the Disabled Adult Child (DAC) and Disabled Widow/widowers Benefit (DWB) groups special income disregards in 182-512-0880 (2) and (3) are not allowable. Federal law does not allow the DAC and DWB disregard in the MSP eligibility determination.
  • For a single individual, net countable income is compared to the income standards described in WAC 182-517-0100.
  • When a married person applies for an MSP, eligibility is determined using the 2-person standard when both applicants are applying for and entitled to Medicare. When only one person in the couple is applying for an MSP, eligibility is determined as follows:
    • Compare the income of the nonapplying spouse (NAS) (after allowable deductions to children in the household, if any) to one half of the federal benefit rate (FBR). If the countable income of the nonapplying spouse is equal to or less than ½ FBR, then no income is allocated to the MSP applicant and only the applicant’s income is compared to the one-person MSP standard.
    • If the countable income of the nonapplying spouse is greater than ½ FBR, then their countable income is allocated to the MSP applicant. The applicant is then allowed the standard $20 exclusion and a deduction of $65 plus ½ of any earned income. The remaining amount is then compared to the two-person MSP standard. See the Medicare Savings Program eligibility desk aid for more information.
    • If an individual or couple is not eligible using the SSI-related rules above there is another methodology that ACES will use automatically when a spouse, or countable child, as defined in WAC 182-512-0820, is in the household. The new method compares net countable income based on the countable number of households members to the appropriate program FPL based on household size. This can result in an applicant becoming eligible for a program when they were not previously or moving up the MSP continuum (towards a more comprehensive program) due to the increased limit based on the household size. The standards chart with MSP income limits based on household size are posted and updated annually.
    • There is no resource test for the MSPs. Do not request verification of resources for MSP only applications.
  • If eligible for SLMB, QDWI, or QI-1, MSP should be approved retroactively prior to the certification period if the individual meets the requirements in WAC 182-504-0025.

How do I recognize Medicare Part A Entitlement?

  • Obtain proof of Medicare Part A entitlement from the individual, based on one of the following:
    • Medicare card;
    • Medicare award letter, if available;
    • State Online Query (SOLQ) Medicare Insurance section or BENDEX (ACES online), except for Railroad Retirement Board beneficiaries;
    • The SOLQ Medicare Insurance section screen shows Medicare Part A (Health Insurance) and Part B entitlement (Supplemental medical insurance); and
    • Contact the Railroad Retirement Board at 800-808-0722.
  • For MSP and State-funded Buy-In, individuals need to be:
    • Entitled to Medicare Part A but do not have to be receiving or enrolled in Part A at the application for benefits; and
    • Entitled to Medicare Part A when asking for retroactive certification for each of the retroactive months.

What is the Program Priority for Medicare Savings Programs?

  • Qualified Medicare Beneficiary
    • The ACES medical coverage group for QMB is S03.
    • The income standard for a QMB is 110% FPL.
      Note: A QMB who is eligible for another Medicaid program (QMB dual eligible) receives QMB (S03) with the other Medicaid program. These QMB dual eligible individuals (also known as "full dual-eligibles") are screened in ACES on medical coverage group S03 and the other Medicaid programs (for example, S03 and S02).
  • Specified Low-Income Medicare Beneficiary (SLMB)
    • The ACES medical coverage group is S05.
    • The income standard for SLMB is 120% of FPL.

SLMB dual-eligibility

A SLMB who is eligible for another Medicaid program (SLMB dual) receives SLMB (S05) with the other Medicaid program. The Medicaid programs medical coverage group will vary depending on the individual’s eligibility. These SLMB dual-eligible individuals (sometimes referred to as "partial dual-eligibles") are screened into ACES on medical coverage group S03 (which trickles to S05) and a Medicaid program (for example, S05 and S02).

  • Qualifying Individuals (QI-1)
    • The ACES medical coverage group is S06.
    • The income standard for QI-1 is 138% of FPL.
  • Qualified Disabled Working Individual (QDWI)
    • The ACES medical coverage group is S04.
    • The income standard for QDWI is 200% of FPL.
    • Individuals must be employed to qualify.
  • State-funded Buy-In
    • There is no ACES coverage group for these individuals.
    • Any individual who is eligible for Medicaid and there is no MSP open, is eligible for the state-funded buy-in program.

How does the buy-in process work?

  1. When an MSP is approved in ACES, ProviderOne runs a search application during the last week of every month to find Medicaid and MSP individuals eligible for Medicare premium payment/buy-in. This process identifies individuals who meet the buy-in criteria. The individual's data is sent to the CMS.
  2. CMS compares the state’s data against their own to match for name, date of birth, sex, and the Medicare Health Insurance Claim (HIC) number.
  3. CMS forwards the matched data to the SSA payment centers to issue Part B refunds to beneficiaries and to update the SSA record.
  4. The Medicare Buy-In Unit (MBU) may send BarCode ticklers to CSO and HCS staff requesting corrective actions, such as S03 screening.
  5. If the individual is being billed for Part B premiums or their Part B premiums are still being deducted from their benefit checks after 60-90 days, the individual or worker should contact the HCA Buy-In unit at 800-562-3022 ext. 16129.

Can an individual be on MSP and spenddown at the same time?

  • An individual pending spenddown may be eligible for MSP if their income meets program requirements.
  • An individual may receive any of the MSPs when spenddown is pending. Only QMB and SLMB may be open concurrent with another medical program.
  • An individual receiving Tailored supports for older adults (TSOA) can receive an MSP program along with TSOA.
  • When an individual pending spenddown receives QI-1 (S06) or QDWI (S04) and is later certified for a CN or MN medical program, ACES will prompt the worker to close the QI-1 (S06) or QDWI (S04). When the CN or MN certification ends, the individual can be reopened for any remaining months of the original QI-1 (S06) or QDWI (S04) certification period.

Example

A person pending spenddown is opened on MSP QI-1 (S06) based on their income. The individual meets spenddown, is approved for MN coverage and is no longer eligible for QI-1 when receiving Medicaid. When the MN certification ends, the client is reopened (a new application is not needed) on QI-1 for any remaining months of the original QI-1 certification.

Can an individual be on Healthcare for Workers with Disabilities (HWD) (S08) and MSP/state-funded buy-in at the same time?

  • To qualify for the federal Medicare Savings Programs (MSP), individuals enrolled in the HWD program must meet all MSP eligibility requirements outlined in WAC 182-517-0100.
  • Most HWD individuals will have income that exceeds the limits for a federal MSP however, they remain eligible for Categorically Needy (CN) Medicaid. This ensures eligibility for the state-funded Medicare buy-in program. 
  • If an HWD individual loses entitlement to premium free Part A Medicare and chooses to self-pay their Part A premium, the state may pay their Part B premiums through the state-funded buy-in.
  • If the individual stops paying their Medicare Part A premium the state will no longer pay the individual’s Part B premium, and the individual will lose eligibility for the state-funded buy-in program.
    The state may not pay both Part A and Part B premiums for those HWD individuals who have lost free Part A entitlement.

Worker responsibilities

  • Refer individuals with Medicare questions to Medicare at 1-800- Medicare (800-633-4227) or TRS through Washington Relay.
  • Refer individuals with questions about Railroad Retirement (RRB) benefits to the Railroad Retirement Board at 800-808-0722.
  • Railroad Retirement Medicare entitlement is NOT in SOLQ. The individual can present a Red, White, and Blue Medicare entitlement card or RRB approval or award letter that shows the individual's or dependent's Medicare coverage. RRB award letters do not provide entitlement dates for Part A and Part B. The RRB Red, White, and Blue cards do provide Medicare entitlement dates.
    • Workers should call 877-772-5772 to request RRB Medicare entitlement dates.
    • Update TPL screens, if not already updated by AUTO.
    • Approve the appropriate Medicare Savings Program when an individual or dependent of a RRB individual has RRB Medicare coverage.
  • Refer individual questions about the Medicare Prescription Drug Program (Medicare Part D) or specific drug plans to:
  • Refer individual questions about Extra Help Paying for Medicare Prescription Drug Costs to:
  • Processing MSP cases in ACES includes adding and/or updating the TPL screens unless ProviderOne has already updated the ACES TPL screens.
  • For the Eligibility Established Date, use the date that all the needed verification/information is available. The QMB start date is the month after eligibility is established and should not be delayed when processed later due to workload.
    Example: Individual submits online MSP application on May 30th and all information is available to determine eligibility on May 30th. The state processes and approves the application on June 10th. May 30th is entered as the Eligibility Established Date and QMB coverage is approved starting June 1st.
  • Medicare and long-term services and supports (LTSS). This section provides more detailed information about Medicare Part D and post-eligibility determinations.

Clarifying information

What do the Medicare Savings Programs (MSP) and Medicaid offer Medicare beneficiaries?

  • The MSP pays some out-of-pocket Medicare expenses for Medicare beneficiaries who meet the MSP income tests. For example and depending on the category of MSP eligibility, MSP can pay:
    • Part A and Part B premiums; and
    • Deductibles, coinsurance, and copayments for Medicare Parts A, B, and C.
  • The state notifies Medicare every month via an electronic interface about individuals with both Medicaid and Medicare. Medicare automatically assigns Medicaid individuals with Medicare and/or MSP to a Medicare Part D plan. Medicare notifies these individuals by mail about their Part D plan.

What expenses are not paid by the Medicare Savings Programs?

The Medicare savings programs do not pay for the following expenses:

  • Medicare Part D premiums
  • Medicare Part D prescription drug copayments
  • Medigap policies
  • Medicare Part C premiums
  • Expenses incurred with a provider who is not contracted with Medicaid.

Automated screening of Medicare Savings Program - Low-Income Subsidy (LIS) applications

As part of the Medicare Modernization Act applications to Social Security for Low Income Subsidy (LIS), also known as Extra Help, are also to be considered an application for Medicare Savings Program without requiring a separate MSP application. To comply with this requirement ACES receives the LIS file through an interface with SSA and automatically screens and processes an MSP program in ACES. Based on the LIS file data, ACES will approve, deny, or pend the MSP based on available information. ACES will then send the appropriate approval, denial, or request letter. Procedures for processing applications received on the LIS data file are below.

Clarifying information

LIS application process

  • Effective January 19, 2026, when an LIS file is received, ACES will no longer send an application to the client. ACES now receives the LIS file and makes an eligibility determination for MSP. ACES will approve, deny, or pend MSP and send a letter to the client based on the case status.
  • ACES can conditionally approve MSP. When this happens, ACES will send a request for information letter explaining the income information needed for ongoing eligibility.
    • ACES will set a follow-up tickle in Barcode for 90 days.
    • When the tickle is assigned to work, staff should follow the processing procedures for the tickle type.
  • The Standard of Promptness (SOP) count begins from the date DSHS received the SSA/LIS data file. ACES is programmed to apply the correct SOP date.
  • ACES will determine income eligibility using the Federal Poverty Level (FPL) % indicated on the LIS data file. If under the MSP FPL limit, the client would be considered eligible using the LIS methodology.
  • ACES utilizes the LIS application household size count when comparing to MSP income limits.
    • For example, even if the applicant is the only one screened into ACES, income will be compared to the standard for a household of two if the LIS household size count indicates a couple.

HCLA worker responsibilities

LIS data received for active L-track or T-track with active Community Spouse (CS) or Institutional Spouse (IS):

  1. Tickle will generate with Subject: Determine MSP eligibility for LTSS with CS/IS
  2. Review active ACES case with spouse to determine if MSP can be screened and processed in a separate assistance unit for the spouse
  3. If spouse's income is inaccurate or not able to be verified in active case, send Request for Information Letter
  4. ACES will deny the 45th calendar day if Begin Intake hasn't been initiated

LIS/MSP data files received for applicants without CS/IS active on L-track or T-track will be automatically approved or denied based on income in eligibility system.

Estate Recovery

Estate Recovery rules do not apply to MSP.

Clarifying information

What is Medicare and who can get Medicare?

Medicare is a federal health insurance program administered by the Social Security Administration (SSA) and the Centers for Medicare and Medicaid Services (CMS). Medicare provides health care coverage for people who:

  • Have worked under the Social Security or Railroad Retirement systems (for more Railroad Retirement information, see Worker Responsibilities, section 2 below) and:
    • Are age 65 or older; or
    • Have been receiving Social Security or Railroad disability benefits for at least 24 months; or
  • Need continuing dialysis for end stage renal disease; or
  • Have received a kidney transplant within the last thirty-six months; or
  • Are receiving Supplemental Security Income (SSI) and;
    • Meet the citizenship and alien status requirements in chapter WAC 182-503-0505 and
    • Are age 65 or older or can draw Medicare based on having sufficient work quarters on their own or through a disabled parent.
  • An individual can apply for Medicare online at Social Security Administration's website.
    The Medicare program includes four kinds of health insurance coverage:

Part A - Hospital Insurance

  • Part A is free for people who have worked and:
    • Have earned the required number of work quarters, or
    • Have a spouse who has earned the required number of work quarters.
  • Part A is also available at a cost for Medicare-entitled individuals who do not have the required number of work quarters for free Medicare Part A.
  • Medicare entitlement dates are in SOLQ on the SSA2 screen. Part A is called “Health Insurance”. Part A entitlements are also listed in ACES online under BENDEX.

Part B - Health Insurance (doctor’s visits)

  • Everyone who enrolls in Part B must pay a monthly premium.
  • Medicare entitlement dates are located in SOLQ on the SSA2 screen. Part B is called “Supplemental Medical Insurance”. Part B entitlements are also listed in ACES online under BENDEX.
  • Effective January 1, 2023 SSA has a new type of Part B (Part B-ID or PBID) benefit only available to individuals who have received Medicare for organ transplant due to end stage renal disease. This new benefit is available to Medicare enrollees who are 36 months post kidney transplant, and therefore are no longer eligible for full Medicare coverage. These enrollees can elect to continue Part B coverage of immunosuppressive drugs by paying a premium. Eligibility for the agency to pay for this new benefit is the same as for any MSP or other Medicaid program. Beneficiaries need not be eligible for Part A but do need to have received Part B previously due to end stage renal disease.
  • Part C - Optional Supplemental Health Insurance
    • Part C is called Medicare Advantage and is a managed care plan.
    • Medicare beneficiaries that choose Medicare Advantage (Part C) must be entitled to Medicare Part A and Medicare Part B or they are unable to enroll in a Medicare Advantage (Part C) plan.
    • Medicare Advantage (Part C) beneficiaries must pay a monthly premium in addition to Part A and Part B premiums when they enroll in a Part C plan.
    • Several Medicare Advantage (Part C) plans doing business in Washington may have a $0 premium and may help pay all or part of your Medicare Part B premium.
    • HCA no longer pays Part C premiums.
  • Part D - Prescription Drug Program
    • Part D benefits are available to all Medicare beneficiaries. To be eligible for Part D, the beneficiary must be enrolled in Medicare Part A or Part B.
    • CMS automatically enrolls dual-eligible (i.e., eligible for both Medicaid and Medicare) and MSP individuals into a Part D plan.
    • Dual-eligible individuals begin receiving most of their prescription drug benefits through Medicare and not Medicaid when they gain dual-eligibility status (CN or MN plus Medicare).
    • If a beneficiary has creditable coverage covering prescription drugs through a private insurance, a beneficiary can disclose this information to Medicare. See Creditable Coverage | CMS.
    • Dual-eligible and MSP individuals may change to a different Part D plan quarterly if they choose. For more information see Drug coverage (Part D) | Medicare.
    • The requirement to purchase drugs through a Medicare Part D plan begins as soon as Medicaid (HCA) is notified of Medicare eligibility.
    • Medicare has contracted with Limited Income Net (Humana) to provide prescription drug coverage for Medicaid individuals newly entitled to Medicare and not yet enrolled in a Part D plan.
      • Pharmacies can bill the Limited Income Net (Humana) plan when a Medicaid individual has not yet enrolled in a Part D plan. Medicaid individuals must show proof of Medicaid eligibility and Medicare entitlement to the pharmacist. A Medicaid award letter is sufficient proof of Medicaid and a Medicare card or letter from SSA stating the effective date of Medicare is sufficient proof of Medicare entitlement.
      • The Limited Income Net (Humana) plan can be reached at 1-800-783-1307.
  • Dual-eligible and MSP individuals have copayment cost sharing for Part D covered drugs.
  • Institutionalized and Home & Community Service waivered individuals are exempt from paying Part D copayments. If an HCBS waiver individual is still being charged Part D copayments at their pharmacy, refer the individual to contact CMS at 206-615-2354. For more information specific to long-term care individuals, see Medicare and long-term services and supports (LTSS).
  • Medicaid continues to pay for some drugs that Medicare excludes under Medicare Part D rules. This information is located at Apple Health Preferred Drug List (PDL).

Medicaid and MSP individuals receive a ProviderOne services card that looks like a plastic credit card. For more information visit ProviderOne services card.

For questions or issues about buy-in

For assistance with Medicare premium payment questions only, contact the HCA Medicare Buy-In Unit at 800-562-3022 Ext: 16129.

If you have an eligibility question or need assistance with an administrative hearing issue, please contact the centralized Apple Health Eligibility Policy email HCA AH Eligibility Policy.

ACES procedures

See the DSHS website: Medicare Savings Program

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