People get tripped up by the similar names: Medicare and Medicaid. But don't worry, we're here to clear things up! These are actually two very different programs that serve distinct needs.

In a nutshell, Medicare is a federal health insurance program primarily for seniors (age 65+) and some people with disabilities.

Medicaid, on the other hand, is a joint federal and state program that provides health coverage for low-income individuals and families.

Let's break down the key differences between Medicare and Medicaid to help you find the right program!

Quick Comparison Of Medicare Vs Medicaid

Here's a breakdown of their key differences to help you understand which program might be right for you:

Feature	Medicare	Medicaid
Age Eligibility	65 or older (generally)	Varies by category (children, pregnant women, people with disabilities can also qualify)
Income Restrictions	None	Yes (based on % of Federal Poverty Level)
Asset Limits	None (for most people)	May vary by state
Premium Costs	Varies by plan (Parts A & B, Medigap)	Typically $0
Deductible	Part A: $1,556 (skilled nursing) Part B: $278 (in 2024) Part D: Varies by plan	Typically minimal or none (varies by states)
Copay	Part A: No copay (up to 60 days), then daily copay Part B: Varies by service Part D: Varies by plan	Doesn't provide any copays
Coinsurance	Yes (percentage of covered costs)	May be minimal or none
Plan Choice	Multiple options (Original Medicare, Advantage, Part D)	Limited options (benefits vary by state)
Network Restrictions	May vary by plan (Original Medicare has wider network)	May require using in-network providers

Difference Between Medicare Vs Medicaid: Detailed Comparison

When it comes to health insurance, there are key differences between Medicare insurance and Medicaid that you should know.

Medicare is for people who are 65 and older, while Medicaid is there to support individuals with low income.

Each has its own rules, costs, and coverage options. If you're eligible for both, they team up to take care of your healthcare needs.

Let's compare them in detail!

Program Basics

In terms of the basics, Medicare is a federal program for seniors and people with disabilities. But Medicaid is a joint federal-state program for low-income individuals.

Medicare:

Medicare is a government health insurance for folks aged 65 and up, plus those with disabilities or certain illnesses. It's managed by the Centers for Medicare & Medicaid Services (CMS).

There are four parts to Medicare:

• Part A: Covers hospital stays.

• Part B: Covers medical services.

• Part C: Known as Medicare Advantage, it's offered by private companies and includes extra benefits like dental and vision.

• Part D: Covers prescription drugs.

Parts A and B together are called original Medicare. You might pay a monthly fee for Part B, but most people won't pay for Part A.

With Medicare Advantage, private plans take over Parts A and B. These plans often include more benefits, but you still pay Part B fees.

If you have original Medicare and need drug coverage, you'll need a Part D plan. While many Advantage plans include drug coverage, some don't, so you'd have to get it separately.

Medicaid:

Medicaid is health insurance that helps people who don't have a lot of money. The government and states pay for it together.

It gives free or cheap coverage to adults, pregnant women, kids, and others who need it. Another program, CHIP, helps more kids from families with a bit more money.

Medicaid and CHIP are managed by state and local groups in all 50 states, Washington D.C., and 5 territories.

Each place decides who can get help, but they must follow rules from the CMS. Every year, millions of adults, kids, and people with disabilities get help from these programs.

According to Medicaid, in January 2024, a total of 84.04 million people were enrolled in Medicaid and CHIP across 51 states and the District of Columbia.

To be specific:

• 76.93 million individuals were enrolled in Medicaid.

• 7.11 million individuals were enrolled in CHIP.

As of the enrollment data of January 2024, almost 46.1% of the total enrollees in Medicaid and CHIP were children.

Eligibility Requirements

Before you apply for any of these federal programs, it's important to comprehend the eligibility requirements. This will reduce any further hassles and streamline your journey.

Medicare Eligibility:

In most cases, the eligibility criteria for Medicare is determined according to the age of the applicant. Except for the people who are disabled.

Age 65+: The primary eligibility requirement for Medicare is reaching at age 65. Most people automatically become eligible for Medicare when they turn 65 and have already been receiving Social Security benefits for at least three months.

Disability Under 65: Even if you're under 65, you might qualify for Medicare if you have a qualifying disability and have been receiving Social Security disability benefits for at least 24 months.

End-Stage Renal Disease (ESRD) or ALS (Lou Gehrig's Disease): Exceptions exist for younger individuals with certain medical conditions. People diagnosed with End-Stage Renal Disease (ESRD) requiring dialysis or those with Amyotrophic Lateral Sclerosis (ALS) may qualify for Medicare regardless of age.

Important Note: It's always best to check with the Social Security Administration (https://www.ssa.gov/) or visit the Medicare website (https://www.medicare.gov/) for the latest eligibility information and enrollment details.

Medicaid Eligibility:

Figuring out if you qualify for Medicaid can seem complex, but here's a breakdown to help you navigate the process:

Income-Based Eligibility:

State Thresholds: The primary factor is your income compared to your state's established Medicaid eligibility threshold.

Each state sets its own income level, with the option to go as high as 133% of the federal poverty level (FPL) for adults (the actual calculation might bring it closer to 138% FPL).

Children: The good news for children is that financial eligibility is at least 133% of the FPL in every state, making it easier to qualify.

The Medicaid income limits vary by state, but here's a table showing the maximum income to qualify for Medicaid in most states:

Household Size	Max. Income to Qualify (138% of FPL)
1	$20,783
2	$28,207
3	$35,632
4	$43,056
5	$50,480
6	$57,905
7	$65,329
8	$72,754

Mandatory Eligibility Groups:

Beyond income, certain groups automatically qualify for Medicaid, regardless of income level. These include:

• Qualified children and pregnant women: This ensures vital healthcare access for these groups.

• Supplemental Security Income (SSI) recipients: Individuals receiving SSI benefits automatically qualify for Medicaid.

Additional Coverage Options:

States have the flexibility to offer Medicaid coverage to even more groups. This might include:

• Children in foster care: Providing essential healthcare support for vulnerable children.

• People in need of nursing home care: Helping individuals with long-term care needs.

Medically Needy Option (Some States):

A few states offer Medicaid to "medically needy" individuals. This means even if your income is above the standard threshold, you might still qualify by spending down your assets (like putting money in a trust) to reach the state's designated income limit.

Remember, eligibility requirements can vary by state. The best way to determine your specific situation is to contact your state's Medicaid agency.

Their website or your state's Department of Health and Human Services can provide the most up-to-date information and guide you through the application process.

Benefits Covered

Let's discuss the specific benefits covered by Medicare and Medicaid to help you understand what each program provides:

Medicare Coverage:

Medicare is a health care program for U.S. citizens aged 65 or older and those with certain disabilities. It's divided into four parts:

Part A: Hospital Coverage

• Covers hospital stays for those 65 and older who've worked and paid Medicare taxes for at least 10 years.

• Most don't pay a premium, but there are deductibles and coinsurance.

Part B: Medical Services

• Covers doctor visits, lab work, and medical equipment like wheelchairs.

• The 2024 premium is $174.70, with higher costs for high-income earners.

• You can delay signing up if you have employer insurance, but there may be penalties later.

Part C: Medicare Advantage Plans

• Offered by private companies and cover what Parts A and B do, plus extras like vision and dental.

• They vary in cost and coverage, so choose carefully based on your needs.

Medicare Supplement Insurance (Medigap):

• Helps pay for costs like deductibles not covered by Original Medicare.

• Not all doctors accept it, so check before signing up.

Part D: Prescription Drug Coverage

• Covers prescription drugs with monthly premiums and yearly deductibles.

• You can't buy it separately if your Medicare Advantage plan includes drug coverage.

Remember, the annual enrollment period is from October 15 to December 7. Make sure to review your options and choose the plan that best fits your needs during this time.

Medicaid Coverage:

Medicaid offers a broad range of healthcare benefits, but it's important to understand that the specifics can vary depending on your state. Here's a breakdown of what Medicaid covers:

Mandatory Benefits (Required by Federal Law):

• Hospital Stays: Medicaid covers medically necessary inpatient hospital stays, similar to Medicare Part A coverage. This includes room and board, doctor visits while hospitalized, certain medications, and some therapies.

• Outpatient Hospital Services: This covers doctor visits, diagnostic tests (like X-rays and lab work), and treatments provided in an outpatient hospital setting (not requiring an overnight stay).

• Laboratory and X-ray Services: Covers necessary lab tests and X-rays to diagnose and treat medical conditions.

• Family Planning Services: Medicaid covers a range of family planning services, including contraception, pregnancy testing, and prenatal care.

• Nursing Facility Services: For individuals who need long-term skilled nursing care, Medicaid may cover the cost of care in a nursing home or skilled nursing facility.

• Home Health Services: Medicaid can help cover the cost of skilled nursing care or other health-related services provided in your home. This might include help with daily living activities, wound care, or physical therapy.

• Doctor Visits: Medicaid covers visits to primary care physicians (PCPs) and specialists for medically necessary services.

• Transportation to Medical Care: Medicaid may help cover the cost of transportation to and from doctor appointments, therapies, or other covered medical services. This can be crucial for individuals who have difficulty accessing transportation on their own.

Optional Benefits (Offered by Some States):

In addition to the mandatory benefits, some states opt to offer additional benefits under their Medicaid program. These might include:

• Prescription Drugs: Many states cover prescription medications through Medicaid, similar to Medicare Part D. This can be a lifesaver for individuals who rely on medication to manage chronic conditions.

• Therapy Services: This could include physical therapy, occupational therapy, speech therapy, or respiratory care services. These services can be essential for improving mobility, regaining skills after an illness, or managing chronic conditions.

• Vision Services: Some states offer vision coverage through Medicaid, including eye exams and eyeglasses.

• Dental Services: Dental care is an often-overlooked aspect of health, and some states offer Medicaid coverage for dental cleanings, fillings, and other essential services.

The best way to determine the specific benefits offered by Medicaid in your state is to contact your state's Medicaid agency.

Costs and Funding

Although Medicare and Medicaid are federal programs, you may have to spend some money, which are considered out-of-pocket costs.

Medicare:

While Medicare offers valuable coverage, beneficiaries typically share some of the costs depending on their specific plan and income level. Let's break down the costs for each Medicare part:

Part A (Hospital Insurance):

Most people don't pay a monthly premium for Part A if they or their spouse worked and paid Medicare taxes for at least 10 years. However, if you don't meet this requirement, you might be responsible for a monthly premium, which can be either $278 or $506 in 2023.

Part B (Medical Insurance):

Part B has a monthly premium that everyone pays, but the amount can vary based on your income. In 2023, the standard premium is $164.90, but higher earners might pay more, up to $560.50 per month.

Additionally, after you meet your annual deductible (the amount you pay before Medicare starts covering costs), you'll also be responsible for coinsurance, which is typically 20% of the cost of covered services.

Medicare Advantage Plans (Part C):

If you choose a Medicare Advantage plan (MA plan), you'll still pay your Part B premium and some MA plans may have additional monthly premiums.

Part D (Prescription Drug Coverage):

Part D premiums and deductibles vary depending on the specific plan you choose. High-income beneficiaries may also pay a premium surcharge. Deductibles can't exceed $505 in 2023, and some plans have no deductible at all.

Medicaid:

One of the significant advantages of Medicaid is its affordability for qualified individuals and families:

Out-of-Pocket Costs:

Federal guidelines determine how much Medicaid enrollees pay out-of-pocket. States cannot require premiums from people with incomes under 150% of the federal poverty level.

However, there are exceptions with special waivers. There's also a limit on total out-of-pocket costs, set at 5% of a beneficiary's income.

Copayments:

With Medicaid, you might have small copayments for certain services, typically $10 or less for medications and doctor visits. The exact amount can vary by state.

How To Apply:

We have discussed all the aspects regarding Medicare and Medicaid. Now you know each program very well. It's time to know how to apply.

Medicare:

Automatic Enrollment: Most people automatically qualify for Medicare Part A (hospital insurance) at age 65 if they have already been receiving Social Security benefits for at least three months.

Part B Enrollment: You'll receive a Medicare enrollment application around age 65. It's crucial to review your options and decide if you want to enroll in Part B (medical insurance) during this Initial Enrollment Period.

Social Security Administration: For more information and to apply for Medicare, visit the Social Security Administration website (https://www.ssa.gov/) or call 1-800-MEDICARE (1-800-633-4227).

Medicaid:

Eligibility Varies: Since Medicaid eligibility is based on income and can vary by state, you'll need to contact your state's Medicaid agency to find out if you qualify and how to apply. You can usually find contact information online or by calling your state's HHS Department.

Simplified Application Process: Many states offer streamlined online applications for Medicaid. You can also apply in person at your local Medicaid office.

It's always a good idea to apply during the designated enrollment periods to avoid any coverage gaps. You may be eligible for a Special Enrollment Period if you lose other health insurances.

Medicare Vs Medicaid: Which One Is The Best?

There isn't a single "best" option between Medicare and Medicaid because they serve different purposes and have different eligibility requirements.

Here's a breakdown to help you decide which might be a better fit for you:

Eligibility:

• Medicare: Primarily for people 65+ or those under 65 with qualifying disabilities and Social Security benefits for at least 24 months. Exceptions exist for younger individuals with ESRD or ALS.

• Medicaid: Open to all ages who meet income thresholds set by each state.

Cost:

• Medicare: Typically has out-of-pocket costs like deductibles, copays, and coinsurance. You can purchase supplemental Medigap insurance to help cover these costs. Part D (prescription drug coverage) is a separate program with its own costs.

• Medicaid: Minimal or no cost for qualified beneficiaries. Some states may have small copays for certain services.

Here's a quick decision tree to help you get started:

• Are you 65 or older, or under 65 with a qualifying disability and Social Security benefits?

• Yes: You're likely eligible for Medicare. Consider:

• Do you want more flexibility in choosing doctors? Original Medicare might be a good choice.

• Are out-of-pocket costs a concern? Explore Medicare Advantage plans or consider Medigap supplemental insurance. You can also enroll in a separate Part D plan for prescription drug coverage.

• No: Move on to question 2.

• Do you meet your state's income eligibility requirements for Medicaid?

• Yes: Medicaid might be a good option for you, especially if you have limited income.

• No: You wouldn't qualify for Medicaid based on income, but you might still be eligible for Medicare (depending on your age/disability status). Explore options like Original Medicare or Medicare Advantage plans.

FAQs

Can You Have Both Medicare And Medicaid?

Yes, if you're 65 or older and meet your state's income requirements for Medicaid, you can have both Medicare and Medicaid. Having both gives you better health coverage at a lower cost.

What Is A Dual Eligibility?

A dual eligible is someone who qualifies for both Medicare and Medicaid. If you're 65 and qualify for financial help, you can choose between Original Medicare or Medicare Advantage as a dual eligible. This way, you get the healthcare you need and extra help for other healthcare costs.

How many people are enrolled in Medicaid and Medicare?

By June 2023, more than 85 million people are enrolled in Medicaid. As of March 2023, over 65 million people are enrolled in Medicare.

If You Have Medicare And Medicaid, Which Is Primary?

Medicare is the main payer for medical needs, but Medicaid can cover what Medicare doesn't. When you go to a provider who takes both, Medicare pays first for your care. Then, Medicaid pays second, helping with copays and other costs not covered.

If you're eligible for both Medicare and Medicaid, you're probably eligible for the Qualified Medicare Beneficiary (QMB) program, one of four Medicare Savings programs.

With QMB, you'll get help with Part A and Part B premiums, coinsurance, and deductibles.

How do Medicare and Medicaid work together?

Medicare and Medicaid team up to cover medical costs for people who qualify for both programs. First, Medicare pays for services it covers. Then, once all Medicare and other health insurance bills are settled, Medicaid steps in. The coverage depends on your health needs.

What's the income limit to qualify for Medicaid?

To qualify for Medicaid, the highest income allowed is $1,426 a month for one person or $1,923 a month for a married couple. Your eligibility for Medicaid is based on your Modified Adjusted Gross Income (MAGI). This considers your tax filing relationships to figure out if you qualify.

Conclusion

Medicare and Medicaid might seem confusing, but they're different programs.

Medicare is mostly for people over 65 or with disabilities. Medicaid is for people who meet income limits set by each state.

Both programs help with healthcare costs, but they cover different things and cost different amounts. Knowing the difference helps you pick the right plan for you.

If you need more help figuring things out, talk to your doctor or a social worker. They can explain your options in plain English and make sure you get the best coverage.