The words are so much alike that it’s easy to get them confused. Both are government programs and both help people pay for health care.
Medicare and Medicaid are social insurance programs that allow the financial burdens of illness to be shared among healthy and sick individuals, and affluent and low-income families. There are some major differences between the two. These differences primarily have to do with who runs them, who qualifies for them, how much users pay and hat services they cover.
What is the difference between the two?
Administered by the federal government, Medicare is a health insurance program primarily intended for adults who are 65 years of age or older. Patients pay part of costs through deductibles for hospital and other expenses. Small monthly premiums are required for non-hospital coverage.
An individual who lacks the necessary work credits can also benefit from the program through their spouse, as can individuals who are younger than 65 but have received Social Security Disability Insurance payments for at least two years.
Medicare provides benefits for:
- Eye tests performed by optometrists
- Consultation fees for doctors, including specialists
- Tests and examinations by doctors needed to treat illnesses, such as x-rays and pathology test
- Some surgical procedures performed by approved dentists and other therapeutic procedures performed by doctors
- Specific items under the Cleft Lip and Palate Scheme
- Specific items for allied health services as part of the Chronic Disease Management Plan
- Specific items under the Enhanced Primary Care (EPC) program
Medicaid (known as Medi-Cal in California) is a state and federal program that provides health coverage if you have a very low income. It serves low-income people of every age. Patients usually pay no part of costs for covered medical expenses. A small co-payment is sometimes required. It also varies from state to state.
Remember that Medicaid planning is a complicated process and even a small error can mean the program will refuse to help pay for the cost of a nursing home stay. Be sure to speak with an expert if you have concerns.
Mandatory benefits for Medicaid:
- Inpatient hospital services
- Outpatient hospital services
- EPSDT: Early and Periodic Screening, Diagnostic, and Treatment Services
- Nursing Facility Services
- Home health services
- Physician services
- Rural health clinic services
- Federally qualified health center services
- Laboratory and X-ray services
- Family planning services
- Nurse Midwife services
- Certified Pediatric and Family Nurse Practitioner services
- Freestanding Birth Center services (when licensed or otherwise recognized by the state)
- Transportation to medical care
- Tobacco cessation counseling for pregnant women
The Medicare and Medicaid programs work together to provide medical coverage to elderly and poor people. Medicare is the primary medical coverage provider for many persons aged 65 and older and for those with a disability. Eligibility has nothing to do with income level. Meanwhile, Medicaid eligibility is designed for people with limited income, and it is often a program of last resort for those without access to other resources.