What's the Difference Between Medicare & Medicaid?
If you don't receive health insurance through an employer or can't afford to purchase a private policy, you may be eligible for government-run Medicare or Medicaid. While their names sound similar, these programs are designed to cover different populations with varying needs. Depending on certain requirements, you could qualify for 1, none, or possibly even both. While fully understanding the programs can be a bit tricky, read on to learn the basics of who's eligible, the services they cover, and what (or if) you have to pay.
Who's Eligible for Medicare & Medicaid?
Both Medicare and Medicaid are government programs designed to provide healthcare to certain people in need, but the requirements for eligibility are unique to each program.
Medicare is primarily for people over age 65, as well as younger people with certain disabilities, regardless of income. Medicaid, on the other hand, provides free or low-cost coverage to people with a demonstrated financial or medical need.
Read on to see how the qualifying factors differ for each program.
What Do Medicare & Medicaid Cover?
On top of the requirements for coverage, Medicare and Medicaid also differ in the medical services they cover.
There are 3 primary parts to Medicare: Part A, Part B, and Part D. Part A covers costs related to short-term stays in hospitals or other medical facilities, while Part B covers fees for doctors, medical tests, and procedures both in and out of a hospital. Part D can be purchased through private insurance companies to cover the cost of prescription drugs, which is required if you don't have coverage from another source. Together, the 3 parts provide basic coverage for people over age 65.
What Medicare doesn't cover is long-term care in a nursing home or most dental or vision services. If you end needing this type of care, you'll end up paying out of pocket.
There's also what's known as Part C Medicare Advantage coverage. This alternative insurance through private companies usually includes the same coverage as Part A, B, and D, while also having additional benefits. Like private plans, what they offer varies, but could include dental, vision, and long-term care.
No matter the state, Medicaid coverage is required to provide the same benefits as Medicare Part A and B. Prescription drugs can also be covered, but individual states decide which prescriptions they cover and which they don't. States also dictate if they provide benefits beyond the mandatory coverage, such as dental services, physical therapy, and chiropractic care.
What's more, there are 2 primary additions that can make Medicaid more beneficial if you qualify: extended care in nursing facilities and personal care at home.
For these reasons, many seniors who are concerned about needing these kinds of services attempt to qualify for Medicaid instead of automatically enrolling in Medicare.
The Cost of Medicare & Medicaid
While Medicare and Medicaid can be appealing options for those who don't have or can't afford private insurance, it's important to remember that they're not necessarily free. Especially for Medicare, some people might be surprised by the amount of the money they still have to pay in premiums, deductibles, and coinsurance.
Those on Medicare don't get 100% of their coverage paid for. The amount of money you're responsible for depends on a number of different factors, including the parts of your plan and the level of your income. Below, get a basic idea of the costs associated with Medicare in 2019, but keep in mind that exact amounts vary depending on your situation.
Beyond the required benefits, each state is allowed to determine what their Medicaid services offer, meaning that the cost of participating in the program depends on where you live. If you're eligible, your Medicaid coverage could very likely come with no monthly premium and little to no deductible or copays.
Keep in mind, however, that what you pay is also dependent on your income. Those above the federal poverty level might have to pay a nominal premium as well as coinsurance of up to 20% of the cost of a prescription drug. If you seek emergency services in a non-emergency situation, you could be subject to paying the entire cost of the care you received.
Can You Qualify for Both Medicare & Medicaid?
It's possible to qualify for both Medicare and Medicaid, though is most cases, you'll need to meet both the age minimum of Medicare and the income and medical requirements of Medicaid. If you're a senior with low income and need long-term care in a nursing home, applying for coverage under both programs could be your best bet.