As stated on medicare.gov, Medicare is health insurance for people age 65 or older, certain people with disabilities under the age of 65, and people of any age with end-stage renal disease (ESRD) – permanent kidney damage requiring a transplant or dialysis. Medicaid is a joint state and federal program that helps cover medical costs for people with limited income and resources who meet specific other requirements. Some people are eligible for both Medicare and Medicaid.
The Main Difference Between Medicare and Medicaid
Medicare is an insurance program, while Medicaid is an assistance program – that is the major difference between the two.
Medicare pays medical bills from funds that have come out of your paychecks over your working years. It is primarily designed for people age 65 and older, regardless of their income. It also benefits younger people with disabilities and ESRD patients. Individuals enrolled in Medicare pay small monthly premiums and deductibles. Medicare is a federal program run by the Centers for Medicare & Medicaid Services.
Medicaid provides assistance to low-income people of any age. Patients often pay no part of the costs for covered medical expenses, but a low co-payment is required in some cases. Medicaid is a joint state-federal program that varies among states and runs within federal guidelines by state and local governments.
What Are the Parts of Medicare?
Medicare is easier to understand if you know what the different parts are.
- Part A — Hospital insurance under Original Medicare: Part A covers inpatient hospital, skilled nursing facility, hospice, and home health care.
- Part B – Medical insurance under Original Medicare: Covers doctors’ and healthcare providers’ services, outpatient care, home health care, preventative services such as screenings and vaccines, and durable medical equipment such as wheelchairs and walkers.
- Part C – Medicare Advantage plans: Bundled plans including Parts A, B, and often D serves as an alternative to Original Medicare. Most Medicare Advantage plans offer vision, hearing, dental, or other benefits not covered by Original Medicare.
- Part D – Prescription drug coverage: Part D is run by private insurance companies that follow Medicare rules. It helps cover the cost of prescription drugs and vaccines.
Who Is Eligible for Medicaid?
To qualify for Medicaid, you must have limited income. In addition, you must be:
- 65 or older
- Under age 19
- A parent or adult caring for a child
- An adult without dependent children in some states
How Can You Qualify for Both Medicare and Medicaid?
Some people are “dual eligible,” meaning they qualify for both Medicare coverage and Medicaid benefits. These people are likely to have most of their health care costs covered. Many senior citizens are dual eligible. They qualify for Medicare based on their age, and they qualify for Medicaid based on their income and financial circumstances.
The best way to find out if you are eligible for Medicaid is to contact your local Medicaid office. If you have questions about your eligibility or options under Medicare or Medicaid, our friendly agent can help you get your questions answered.