Medicare and Medicaid can be confusing. Both programs were created to provide health coverage to groups in need. However, they differ quite a bit in terms of administration, eligibility rules, and services covered.
In this article, we’ll explain the key differences between Medicare and Medicaid in simple terms. You’ll learn who administers each program and sets the rules. We’ll cover who qualifies for benefits, how services are covered, and what out-of-pocket costs apply.
Medicare 101: The Federal Health Program for Seniors
Medicare, a federal health insurance program, primarily serves people ages 65 and older, no matter their income level. Some younger people with disabilities also qualify.
Medicare comes in a few different parts:
- Part A helps pay for hospital stays and skilled nursing facility care. Most people get this premium-free.
- Part B covers doctor visits, preventive care, durable medical equipment, and other outpatient services. The standard monthly premium for Part B in 2023 is $164.90.
- Part D allows private insurers to provide Medicare benefits. Many include prescription drug coverage.
- Medicare Advantage plans bundle Parts A, B, and usually D through private insurers.
No matter which parts you have, you’ll still have some out-of-pocket costs like deductibles and copays. And Medicare doesn’t cover everything – for example, dental, vision, and long-term care.
Medicaid Provides Needs-Based Healthcare Assistance
Now, Medicaid. This joint federal-state program provides health coverage for low-income individuals. Each state runs its own program, so benefits and eligibility vary.
To qualify for Medicaid in New York, your income must be below the state’s limit, which was $17,609 for an individual in 2022. Medicaid eligibility and benefits can vary somewhat by state since the state administers them.
Medicaid covers a comprehensive range of health services, including hospital visits, doctor services, long-term care, and more. People with Medicaid typically pay little or nothing for covered medical expenses. Medicaid also pays for long-term nursing home care, which Medicare does not cover.
Key Differences Between Medicare and Medicaid
While Medicare and Medicaid both provide health coverage, there are some notable differences:
- Eligibility: Medicare eligibility is based primarily on age (65+), while Medicaid considers income level.
- Costs: Medicaid has lower out-of-pocket costs for beneficiaries compared to Medicare. Deductibles, copays, and coinsurance are minimal or nonexistent with Medicaid.
- Benefits: Medicaid covers some benefits that Medicare does not, like nursing home care and non-emergency transportation.
- Administration: Medicare is solely administered by the federal government, while Medicaid administration involves both state and federal authorities.
- Long-term care: Medicaid pays for long-term nursing home care, but Medicare does not cover extended nursing home stays.
- Prescription drugs: Medicaid covers prescription drugs as a core benefit, unlike Medicare, which requires enrollment in a separate Part D plan.
Choosing the Right Healthcare Program for Your Needs
When deciding between Medicare and Medicaid, consider your age, income, health status, and state of residence. Do you meet the eligibility criteria? What benefits do you need covered? What costs can you afford?
Compare Medicare plans to see if Medigap or Medicare Advantage better meets your needs. Understand Medicaid coverage in your state. Those dually eligible for Medicare and Medicaid get the most comprehensive coverage.
Planning ahead for your long-term care needs is also important. Consult with our estate planning attorneys if you need help weighing Medicare vs. Medicaid and coordinating benefits.
Partner with a Long-term Care Planning Firm Today
Medicare and Medicaid can be complex. Changes to programs and costs happen frequently. The longterm care planning lawyers at The Browne Firm stay on top of the latest details so we can offer you tailored guidance.
With their support, you can make sense of Medicare and Medicaid to optimize your healthcare coverage. They’re available to answer your questions and craft plans that fit your unique circumstances.
Visit https://www.thebrownefirm.com/ to learn more.
