Both Medicare and Medicaid were created by the federal government and are funded by taxpayer dollars. Their purpose is to help cover healthcare costs. Despite their similarities, these programs perform different functions and have different eligibility requirements.
Receiving Medicare will not automatically qualify you for receipt of Medicaid. However, if you meet the eligibility requirements for both programs, you may qualify for both. Note that in California, Medicaid is simply called a Medi-Cal.
Medicare: Who Can Benefit and What Does It Cover?
The Medicare program is not need-based. Instead, it helps cover health care costs of the elderly and people with certain disabilities. At 65, any US citizen can get Medicare. The coverage includes the following persons:
- US citizens of 65 and older
- Some persons with Social Security disability
- Individuals with permanent kidney failure
Medicare covers four health care circumstances, as outlined below:
- Part A is hospitalization insurance. This covers stays in hospitals and skilled nursing facilities.
- Part B medical insurance pays for doctors, lab tests costs, outpatient services.
- Part C is supplemental insurance which may be bought privately and provides supplemental coverage.
- Part D medicine insurance pays for some prescription drugs.
What Costs Are Involved in Medicare Coverage?
Unless one is also qualified for Medicaid, or some other low-income subsidy, Medicare does not come for free. Even though there is an entitlement to receive Medicare paid for by social security taxes, one has to pay part of the costs. For example:
- Payment of deductible (applies to both Part A and B)
- Payment of 20% of physician’s bills, or more (under Part B)
- Payment of monthly premium (under Part B)
- Payment of various premiums, deductible, and copayments (under Part D)
- Copayments for in-hospital stays
Medicaid: Who Is Eligible?
The federal government as well as state government administer Medicaid. The federal government usually pays 50% of the state’s Medicaid costs.
Unlike Medicare, Medicaid is not an entitlement program based on social security taxes paid throughout one’s life. Medicaid has strict eligibility requirements because its purpose is to alleviate the health care costs for the poor. Every state has its own eligibility requirements under which a person may be qualified as poor. Depending on the state, eligibility requirements for the Medicaid may be based on:
- Liquid household assets (liquid assets can be sold for cash quickly)
- Citizenship or residency requirements
- Income level
- In some states, eligibility for Medicaid may also be affected by such factors as:
- Disabled status or a specific medical condition
- Having children or being pregnant
- Being elderly
- Being a caretaker for children
- Being a child or a minor
Note that in addition to Medicaid, seniors may also meet separate eligibility requirements for the Medicare.
What Does Medicaid Cover?
Medicaid covers conditions considered to be "medically necessary." Coverage varies by state, but covered conditions typically include:
- Nursing services
- Pediatric services
- Family planning
Note that Medicaid covers services that Medicare may not cover such as:
- Prescriptions drugs not paid for by Medicare
- Prevention and diagnostics
Considering Medicaid Costs: What Costs Are Involved?
Depending on the state, Medicaid consumers may be required to cover small costs for some services out of their own pocket. Otherwise, Medicaid can actually supplant coverage for Medicare costs. For example:
- Medicaid may pay premiums charged by Medicare
- Medicaid may pay up to 20% of costs not covered by Medicare
- Medicaid may pay Medicare deductibles
Seeking Legal Help
A qualified health insurance attorney may help you succeed in obtaining the necessary coverage. A lawyer can also represent you in an existing coverage dispute.