Medicare vs. Medicaid: Key Differences Every American Should Know

Medicare and Medicaid -- two programs that sound almost identical but serve very different purposes. Mixing them up is one of the most common mistakes people make when navigating health coverage, and it can cost you time, money, and peace of mind. Let's clear up the confusion once and for all.

What Is Medicare?

• Federal health insurance program for people 65 and older (and some younger people with disabilities)
• Funded primarily through payroll taxes, premiums, and the federal budget
• Administered by the Centers for Medicare & Medicaid Services (CMS)
• Divided into four parts: Part A (hospital), Part B (medical), Part C (Advantage), Part D (drugs)
• Eligibility is based on age or disability status, not income

What Is Medicaid?

• Joint federal and state program that provides health coverage based on income
• Each state runs its own Medicaid program with different rules and eligibility thresholds
• Covers low-income adults, children, pregnant women, elderly adults, and people with disabilities
• Often covers services Medicare doesn't, like long-term nursing home care and personal care services
• Little to no cost for those who qualify

Key Differences at a Glance

• Eligibility: Medicare is age/disability-based; Medicaid is income-based
• Funding: Medicare is federal; Medicaid is jointly funded by federal and state governments
• Coverage scope: Medicaid often covers more services (dental, vision, long-term care) but varies by state
• Costs to you: Medicare has premiums, deductibles, and copays; Medicaid is low-cost or free
• Administration: Medicare is federally standardized; Medicaid rules differ state to state

Can You Have Both? (Dual Eligible)

• Yes -- roughly 12 million Americans qualify for both Medicare and Medicaid
• Known as "dual eligible" beneficiaries
• Medicaid can help pay Medicare premiums, deductibles, and copays
• Dual Special Needs Plans (D-SNPs) are designed specifically for people with both
• Extra Help (Low-Income Subsidy) can reduce Part D drug costs

How to Know Which Program You Qualify For

• Check your age, work history, and disability status for Medicare eligibility
• Review your state's income and asset limits for Medicaid
• Use the Medicare.gov eligibility tool or contact your state Medicaid office
• A licensed insurance agent can help you understand where you fall
• Don't assume you only qualify for one -- check both

Need Help?

Figuring out whether you qualify for Medicare, Medicaid, or both doesn't have to be a guessing game. At Insuras Health Benefits, we walk you through the eligibility requirements and help you maximize every benefit available to you.

Have questions? Contact us for a free consultation -- we'll help you sort it out with zero pressure and zero jargon.