The primary difference between Medicare and Medicaid lies in who they cover and how they are funded:
- Medicare is a federal health insurance program mainly for people aged 65 and older, regardless of income, and also covers some younger individuals with certain disabilities. It is funded and run by the federal government and works uniformly across the United States
- Medicaid is a joint federal and state program that provides health coverage to people of all ages with low income, including certain children, pregnant women, and people with disabilities. Medicaid eligibility and benefits can vary by state, although federal rules set minimum standards
Key Differences
Aspect| Medicare| Medicaid
---|---|---
Eligibility| Age 65+ or certain disabilities, any income level| Low
income individuals of any age, some disabled and pregnant people
Funding| Fully funded by the federal government| Funded jointly by
federal and state governments
Coverage| Hospital care (Part A), outpatient care (Part B), plus optional
private plans for extra coverage (Parts C and D)| Mandatory benefits include
hospital, physician, lab, X-rays, and home health services; states may add
benefits like dental, vision, and prescription drugs
Costs to Beneficiaries| Premiums, deductibles, copays, coinsurance|
Usually free or very low cost, depending on state rules and income
Program Variability| Uniform nationwide| Varies by state in eligibility
and benefits
Additional Notes
- People can be eligible for both Medicare and Medicaid simultaneously, known as "dual eligibles." In such cases, Medicare is the primary payer, and Medicaid covers additional costs like copays and premiums
- Medicare has four parts: Part A (hospital), Part B (medical outpatient), Part C (Medicare Advantage plans offered by private insurers), and Part D (prescription drugs)
- Medicaid eligibility uses income methodologies such as Modified Adjusted Gross Income (MAGI) for most groups, but for seniors and disabled individuals, it often uses Supplemental Security Income (SSI) criteria, which consider income and assets
In summary, Medicare primarily serves older adults and certain disabled individuals with standardized federal coverage, while Medicaid serves low- income individuals and families with state-specific eligibility and benefits, often covering additional services and costs that Medicare does not
