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Medicare Versus Medicaid | What’s the Difference?

Medicare and Medicaid are two important government-funded health insurance programs that provide healthcare coverage for individuals with limited resources. While they are both administered by the federal government, there are some key differences between them. Read on to learn the basics of each plan so you can be better informed.

Medicare

Medicare is a health insurance program primarily for people 65 or older, though it also covers certain disabled individuals under the age of 65. It is primarily funded by the federal government, though beneficiaries are responsible for paying premiums and copays for certain services. Medicare provides coverage for hospital stays, doctor visits, home healthcare, and other necessary medical treatments or procedures. 

Before receiving this type of care, you need to begin enrollment. Medicare enrollment is a process by which an individual can sign up for the Medicare program. There are many different options available through the medicare program, and while there are several steps to this process, be sure to understand your options before deciding whether or not to enroll.

Medicare Subsets

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Medicare Advantage is an alternative to traditional Medicare that offers additional benefits, such as vision and dental coverage, for a monthly premium. Unlike traditional Medicare, which pays healthcare providers directly for services rendered, with Medicare Advantage, private insurance companies provide the actual coverage and are paid by Medicare. 

Enrollees in a Medicare Advantage plan receive an insurance card and are encouraged to use in-network providers. Out-of-pocket costs are typically lower than traditional Medicare, though the coverage may be more limited. In addition, some plans offer additional benefits such as fitness programs and prescription drug coverage. Medicare Advantage can be a great option for those who want additional coverage beyond traditional Medicare.

Medicaid

On the other hand, Medicaid is a joint federal and state program that provides health coverage to individuals with limited resources. The program is designed to help those who may not otherwise be able to afford health insurance. While Medicaid covers the same services as Medicare, eligibility requirements vary from state to state and are generally more restrictive than Medicare. 

The Medicaid application process is very similar to other state-run programs. Dropping by your state’s Department of Workforce Services is a great way to be introduced to the requirements and figure out what you need to do to apply.

Additional Differences

Another key difference between the two programs is that Medicaid tends to cover services that Medicare does not, such as long-term care and home health aides. In addition, Medicaid is often more generous with covering prescription drugs than Medicare. 

Covering Costs

Finally, while both programs are designed to provide access to healthcare for those in need, there are a few key differences regarding cost sharing. Generally speaking, Medicare recipients are responsible for paying a portion of their medical costs, while Medicaid recipients may not be required to pay anything. 

Here are some key differences between Medicare and Medicaid that should be considered when deciding which program is best for you or a loved one. While both programs are designed to help those in need, it is important to understand their specific differences. If you have questions about either program, you should always speak with a healthcare provider or insurance agent to find the best plans for your needs.

About the Author:

Dixie Somers is a freelance writer who loves to write for business, health, and women’s interests. She lives in Arizona with her husband and three beautiful daughters.

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