What’s the difference between Medicare and Medicaid?

The words are so much alike that it’s easy to get them confused.

Medicare  Medicaid
What is it?
A federal health insurance program for people who are:

  • 65 or older
  • Under 65 with certain disabilities
  • Any age when you have End-Stage Renal Disease (ESRD) or ALS
What is it?
A joint federal and state program that helps pay health care costs for people and families based on financial assessment – income and resources. 
Who governs it?
Federal government
Who governs it?
State and Federal government
What does it cover?
Depends on the coverage you choose and may include:

  • Care and services received as an inpatient in a hospital or skilled nursing facility (Part A)
  • Doctor visits, care and services received as an outpatient, and some preventive care (Part B)
  • Prescription drugs (Part D)

Note: Medicare Advantage plans (Part C) combine Part A and Part B coverage, and often include drug coverage (Part D) as well – all in one plan.

What does it cover?
Each state creates its own Medicaid programs, following federal guidelines. There are mandatory benefits and optional benefits. Mandatory benefits include, in part:

  • Care and services received in a hospital or skilled nursing facility
  • Care and services received in a federally-qualified health center, rural health clinic or freestanding birth center (licensed or recognized by your state)
  • Doctor, nurse midwife, and certified pediatric and family nurse practitioner services
What does it cost?
Premiums are based on the coverage you choose. Premiums include deductibles and coinsurance.
What does it cost?
It depends on your financial assessment: income and assets and the rules in your state. 
How do I get it?
You enroll in Parts A and B when they turn 65. You can also contact your local Social Security office to see if you are eligible.
How do I get it?
Eligibility depends on the rules in your state. Call your State Medical Assistance (Medicaid) office to see if you qualify or consult with an elder care attorney or certified Medicaid professional.
 

 

 

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About Lavine, MBA, MA, CLTC

Raymond Lavine became interested in extended care benefits (long-term-care insurance) because of personal experiences with the disruption that extended illnesses cause for families and their finances. He now advises families and businesses about ways to mitigate the consequences extended care. Lavine says many people believe that they will never need any form of extended care because they are healthy now. Life studies clearly that many Americans may need extended care at some time, but what people do not consider are not what happens them them but care giving responsibilities which will affect their family, their cash flow, and financial commitments towards the future. The common misconception that Medicare, the Veterans Administration, or some other social service agency will pay for extended care leads people to believe that no individual or family plan is needed. By the time they see the reality, it's too late. Lavine explains the issues and provides the information needed to make an informed decision about planning for extended care. Raymond Lavine has a BA in International Relations from the University of Southern California; an MBA and MA from Drucker-Ito Graduate School of Management, Claremont Graduate University; and the CLTC designation.

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