Yes they're free, The mileage points listed in the previous are correct. The badges themselves show 250,000, 500,000 and 1,000,000 kilometers respectively.
At my current rate, my 240D is about a year and a half away from the 1,000,000 kilometer badge. It already wears the 250,000 and 500,000 kilometer badges on the grill proudly.
If you have enough information on other MB's you've owned, you may also get a high mileage lapel pin.
'84 Euro 240D, 523K miles
'88 300E 5 Speed
'81 300D Daughter's Car
Over 800,000 miles in