Medicare And Medicaid: Are These Two Medical Plans The Same Thing?

Insurance Blog

People sometimes refer to Medicare and Medicaid interchangeably without really knowing if they're quite the same or not. In fact, Medicare and Medicaid are actually two very different types of medical plans. The confusion may arise because both begin with the "Medi" prefix, or it could be because there are many people who may qualify for both programs. Keep reading to learn which program is which, and how to tell whether you are eligible for one or both of them. 

How to Qualify

The qualification requirements for the two programs is perhaps the biggest difference between them. 

• Medicaid: Medicaid is designed to help low-income and poverty-level people pay for their medical costs. It covers people of all ages. It is free to those who meet the income threshold. Because Medicaid is administered by each state, income threshold varies by area.
• Medicare: Medicare is designed to meet the medical needs of senior citizens, age 65 and up. Medicare qualification is not tied to income. Medicare is free to individuals age 65 or over if they have worked and paid Social Security taxes in the United States for at least 10 years. 

It is entirely possible for low-income senior citizens to qualify for both programs, and in fact to participate in both programs at the same time. If a person qualifies for both programs, the Medicaid program will usually pay for the co-payments and premiums associated with Medicare membership. An individual who qualifies for both programs has the fullest possible medical care plan.

The Medicaid Coverage

While both Medicare and Medicaid provide health coverage, the actual coverage can vary quite a bit. Medicaid gives its participants full-scale health coverage. This includes not just doctor and hospital visits but other kinds of coverage that Medicare does not provide. Medicaid covers prescription medications, eye care, and preventive health care. Some Medicaid plans also provide dental care, but this varies by state.

The Medicare Coverage

Medicare is a more limited plan than Medicaid, but it can be expanded to include extra coverage for an additional monthly cost. Medicare is divided into four parts:

• Part A: This part of Medicare pays for hospital visits, medically necessary stays in skilled nursing facilities, and medically necessary home health care. It will also pay for hospice care, either in-home or in a hospice facility. 
• Part B: Part B pays for most of the cost of doctor visits, physical therapy, physiotherapy, medical testing costs, and medical supplies. This part of Medicare requires participants to pay a monthly premium (the amount will vary by person.) Additionally, participants must pay 20 percent of the cost of each of the care types in this category. Medicare pays the remaining 80 percent.
• Part C: Part C is not actually a Medicare plan in the same way that parts A and B are, but is rather the portion of the Medicare policy that permits private insurance providers to offer Medicare plans. Medicare part C simply means that you can buy Medicare plans through a private insurance company (these are known as Medicare Advantage plans) if you choose.
• Part D: Medicare Part D covers prescription drugs. Adding this coverage will incur an extra premium each month, and most Part D plans have co-payments for each prescription.

Only Part A and Part B are required for those who enroll in Medicare. While Part D is not required, many seniors find it extremely helpful to have a large part of their prescription drugs costs covered. If a participant buys the maximum amount of Medicare coverage, they will come close to the level of Medicaid coverage, but Medicaid remains the more extensive coverage. 

If you are low-income and need medical coverage, it makes sense to apply for Medicaid as soon as possible. If you are 65 or over, it is even more important that you get healthcare coverage quickly. Medicare enrollment is free, even if you don't qualify for Medicaid. One (or both!) of these plans can help meet your healthcare needs in the future.

8 October 2015