Medicaid and Medicare are two of the most commonly mixed-up words. Not only do they sound the same, but they are also relatively similar programs.
Knowing the differences between the two programs is important, especially if you’re expecting or hoping to receive benefits from either one. Unfortunately, the names have left people more confused than ever.
If you’re feeling confused about the difference between Medicaid and Medicare, we’re here to help. You’re not the only one bogged down by these logistics. Just keep reading.
The Difference Between Medicaid and Medicare
To figure out the difference between Medicaid and Medicare, we’re going to talk about each program individually. By separating them, we’ll make it much easier to see how Medicaid works versus how Medicare works.
If we were to combine them, you’d be even more confused than when you started. So, here we go: Medicaid vs. Medicare.
What Is Medicaid?
Medicaid is a joint program between the federal government and state governments. A slew of government officials created the program to help low-income individuals in The United States of America handle medical costs. In addition, it provides aid for those who are receiving long-term custodial care.
Keep in mind that Medicaid is for United States citizens of all ages. Medicaid’s main qualification barriers are income and liquid assets. Even seniors can qualify for Medicaid.
Children can also receive aid from Medicaid through a program known as CHIP (Children’s Health Insurance Program). This helps children get low-cost medical care, even if their families make too much to qualify for Medicaid.
Speaking of qualifications for Medicaid, the Affordable Care Act (ACA) in 2010 expanded these for many United States citizens. For most areas, people who make up to 138% above the poverty line qualify for Medicaid.
However, because of a Supreme Court ruling, states did not have to accommodate this expansion of benefits. Therefore, you should check your state’s Medicaid qualification guidelines to see how Medicaid works in your state.
Even though states can choose some of the benefits for Medicaid recipients, there are a few federally-mandated benefits. Again, these vary from state to state, but here are a few of the most common Medicaid benefits:
- Doctors visits
- Nursing services, including nursing facility services
- Treatments done in-clinic
- Family planning and associated services
- Pediatric nurse practitioner services
- Family nurse practitioner services
- Laboratory services
- X-rays and other imaging
- Home healthcare (if that individual is eligible for nursing facility services)
- Midwifery services
As we said, states have the option to accept or reject some of these services. In addition, they can provide coverage for extra benefits, including any of the following:
- Optometrist visits
- Dental visits
- Physical therapy
- Prescription drugs
- Transportation to medical facilities
Medicaid is mostly used to fund long-term care, assuming that that long-term care isn’t covered by private health insurance or Medicare.
What Is Medicare?
Medicare is more intricate than Medicaid. Overall, Medicare is for those United States citizens who are 65 years of age or older. However, you can also qualify for Medicare if you have certain disabilities.
Medicare is split into four different parts: A, B, C, and D. Let’s review what kind of coverage is included in each part of Medicare and other things you need to know about how Medicare works.
Medicare Part A: Hospitalization Coverage
Regardless of their income, Medicare Part A provides hospitalization coverage for individuals who are 65 years of age or older.
If you’re looking to qualify for Medicare Part A, you or your spouse had to have paid Medicare taxes on your income for at least ten years. It does not require a certain amount of income, and it does not require that both of you have taxable income.
Medicare Part A comes with deductibles and coinsurance, but most people don’t have to worry about paying a premium.
Medicare Part B: Medical Insurance
If you’re eligible for Medicare Part A, you’re also eligible for Medicare Part B. This part of Medicare covers services and equipment that your medical providers deem to be medically necessary. There are a variety of things that can apply to Medicare Part B, including the following:
- Visits to doctors’ offices
- X-rays and other imaging
- Lab work
- Flu shots
- Disease prevention techniques
- Outpatient surgeries
If you’re eligible for Medicare Part B but you’d rather remain on your current employer’s insurance, you’re not required to signup right away. However, there are penalties for signing up later.
Medicare Part C: Medicare Advantage Plans
It’s likely that you’re eligible for Medicare Part C if you’re eligible for Parts A and B. Unlike Parts A and B, Medicare Part C is offered by private companies that are approved by Medicare.
Medicare Part C offers those medical services and equipment covered by Medicare Parts A and B. However, it also adds on vision, hearing, and dental coverage. In some cases, prescription drug coverage is also offered.
Medicare Part C mirrors the health maintenance organizations (HMOs) and preferred provider organizations (PPOs) that many people have outside of Medicare.
Those who enroll in Medicare Part C generally pay out of pocket for these services, so you should evaluate your medical needs before considering signing up for Part C coverage.
Medicare Part D: Prescription Drug Coverage
If you’re enrolled or enrolling in a Medicare Part C plan without prescription drug coverage, you’ll want to consider Medicare Part D. Generally, you’ll be paying monthly premiums, a yearly deductible, and copayments for some prescriptions.
If you need assistance paying copayments, coinsurance, and deductibles, you may want to consider Medigap Plan I which is Medicare Supplement Insurance.
If you didn’t know the difference between Medicaid and Medicare before, we’re sure you do now. As we mentioned before, the two programs are similar, but there are a couple of distinct differences that separate them.
Be sure that you understand the differences between each program before you try to enroll in either. You need to understand what you’re getting into if you’re considering either program.
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