It can be easy to confuse Medicare and Medicaid, as they are both government health-care programs. That’s where the similarities end, however, because who they serve, what they cover, and how much they cost are very different. In some situations, you may be eligible for both programs.
Medicare is a health insurance program created and administered by the federal government. It is generally available to U.S. citizens and permanent legal residents who have lived in the country continuously for at least five years. You’re usually eligible once you’re age 65 or older, although younger individuals may qualify if they have received 24 months of Social Security disability benefits (or certain disability benefits from the Railroad Retirement Board). You can also qualify for Medicare under 65 if you have end-stage renal disease (permanent kidney failure and require dialysis or a kidney transplant), or if you have amyotrophic lateral sclerosis (Lou Gehrig’s disease).
Original Medicare refers to the two parts of the program that are federally run, Medicare Part A and Part B. Part A covers inpatient hospital care, and Part B covers medical insurance like doctor visits, preventive services and screenings, and durable medical equipment.
Medicare Advantage (also called Medicare Part C) is offered through Medicare-contracted private insurance companies, and Medicare Advantage plans must offer at least the same benefits as Original Medicare (with the exception of hospice care, which is still covered through Part A of Original Medicare). Medicare Advantage plans may also include benefits beyond what Original Medicare covers, including routine vision or dental, hearing, wellness programs, or prescription drugs.
Medicare Part D is prescription drug coverage, also available through Medicare-approved private insurance companies. You can get this coverage either through a Medicare Prescription Drug Plan, which is stand-alone prescription drug coverage that can be added to Original Medicare insurance, or through a Medicare Advantage plan that includes prescription drug benefits, also known as a Medicare Advantage Prescription Drug plan.
Medicaid is funded jointly at the state and federal levels. It supports low-income individuals and families by covering medical costs as well as other services, such as long-term custodial care or case management services. Medicaid eligibility is determined by income and certain other requirements, and those requirements are set by the state where the beneficiary lives.
Medicare and Medicaid coverage may intersect (for example, during an inpatient hospital stay or a visit to the doctor), but Medicaid coverage varies by state and potentially includes coverage beyond what Original Medicare offers.
While each state determines the breadth of its Medicaid coverage, there are some services that the program is required to include in all states:
States are also free to include optional benefits in their Medicaid programs, including prescription drug coverage, custodial care, podiatry services, and more. Contact the Medicaid program in your state to learn more about the specific benefits covered by your state program.
As mentioned earlier, some beneficiaries may qualify for Original Medicare, Part A and Part B, and Medicaid. They are known as “dual eligibles.” They must meet certain income and asset requirements to qualify for Medicaid, and depending on their eligibility, they may get “full” or “partial” Medicaid benefits.
In addition to services covered through the Medicaid program, dual eligibles may also be eligible for help with Medicare costs through Medicare Savings Programs. These programs are administered by state Medicaid programs and help with Medicare costs like Part A and Part B premiums, deductibles, copayments, and coinsurance costs. There are four types of Medicare Savings Programs available, and each one comes with different income and asset criteria to qualify.
For a dual eligible beneficiary, Medicare-covered services are paid first by Medicare. After Medicare has paid its share (up to coverage limits), Medicaid may act as a secondary payer and cover services that Medicare either doesn’t cover or only covers in part. As mentioned, Medicaid may help with benefits that Medicare does not cover, such as custodial care or chiropractic services. If you’re not covered for a certain benefit through Medicare, check if your state’s Medicaid program covers it.
Dual eligibles may also qualify for the Extra Help program, which helps them with Medicare Part D (prescription drug coverage) costs like premiums, deductibles, and coinsurance. If you qualify for certain Medicare Savings Programs (the Qualified Medicare Beneficiary Program, Specified Low-Income Medicare Beneficiary Program, or Qualifying Individual Program), you’ll automatically be eligible for Extra Help as well.
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To learn about Medicare plans you may be eligible for, you can: