Health comes as a priority in everyone’s life. If health is well, then everything is well. Health care cost is rising. It is eating into workers’ paychecks and straining budgets for businesses and governments. Especially elderly and low-income people have to go through the worst situation when they spend all their money from their paycheck on health care costs. So there are two programs highly named Medicare and Medicaid, and these are U.S. government-sponsored health insurance programs that the government administers.
These programs help American Citizens cover the rising cost of health care. These two programs differ according to their functions, coverage, covered services, and cost-sharing. It is important to know how these programs work and the different coverage and cost-sharing process. So, we will discuss many issues in terms of the difference between Medicare and Medicaid.
What is Medicare
To make health care more affordable and accessible, Medicare is a government national health insurance program in the United States of America. It started in 1965 under the Social Security Administration, but this is now run and administered by Centres for Medicare and Medicaid Services. This is a part of health care for Americans aged 65 and older. The age limit is not confined to this in case certain younger people below 65 years have a disability. This program aims to ensure and cover expenses related to medical care and treatment.
Additionally, seniors with financial constraints can get this program to get financial assistance for medical needs. This program is also for people with End-stage renal disease or permanent kidney failure that requires dialysis and transplant. The United States of America wants seniors to be healthy and expects them to live longer. For this, it strengthens Medicare through different plans and programs to lower the cost of health care for seniors.
What is Medicaid
As discussed above, Medicare applies to seniors aged 65 and older. But another program is designed for low-income people covering health care expenses. These expenses explain hospitalization treatments and routine medical care. Medicaid is one of the nation’s public health insurance programs that helps low-income people with medical expenses. Surely low-income people have to pay a big amount for health care in the United States and this program enables them to cover those expenses. Millions of adults, children, and people with disabilities receive services through this program every year. Medicaid also provides benefits not normally covered by Medicare.
Difference between Medicare and Medicaid in definition: There is a clear definition between Medicare and Medicaid. But the fact is Medicare is only for the elderly who are aged 65 years and older. On the other hand, Medicaid is for people with low income who face health care expenses a higher cost. Plans come differently for Medicare and Medicaid, and it is important to know the plans for both Medicare and Medicaid.
4 Part of Medicare
Medicare has 4 parts and these are different for different needs. These different parts of Medicare help cover specific services according to the needs.
Part A (Hospital Insurance): Medicare Part A is called hospital insurance that covers inpatient hospital stays, skilled nursing facilities, hospice care, and home health care.
Part B (Medical Insurance): Part B is called outpatient medical needs of beneficiaries, and the benefits include services from doctors and health care providers, outpatient care, home health care, durable medical equipment like wheelchairs, walkers, hospital beds, and other equipment. Many preventive services, such as screening, shots, vaccines, and yearly wellness visits.
Original Medicare: Parts A and B are called Original Medicare, and you can join both, and it covers most of the inpatient and outpatient medical needs of beneficiaries.
Part -C (Medicare Advantage): Medicare Advantage is a Medicare-approved plan available for a private company to choose health plans with at least the same service coverage as Part A and Part B. This is run by approved private insurers that include the benefits of Part A and Part B. it is important to note that a beneficiary should enroll in Part A and Part B to singing up for Part C. They provide an alternative to original Medicare for your health and drug coverage.
Part D (Drug Coverage): Drugs are required for the patient, and the prescription drug cost is high. So this part covers the cost of prescription drugs. You may join a Medicare drug plan in addition to your Original Medicare or by joining a Medicare Advantage plan with drug coverage. A private insurance company runs Medicare drug coverage as plans, but they follow the rules set by Medicare.
Medicaid coverage includes many health services, which may not match in all areas. Surely the benefits covered by Medicaid vary by state. More importantly, there are such benefits that can be availed from every program
- Lab and X-ray services
- Inpatient and Outpatient Hospital Services
- Family planning services such as birth control and nurse-midwife services
- Health screening and applicable medical treatment for children
- Nursing facility services for adult surgical dental services for adult
So these are common health services but you may also need to contact the caseworker according to your state office.
Medicare and Medicaid Eligibility in Difference
Medicare: Surely, it is clear that Medicare is for elderly people who are at 65 years and older. They need to be a citizen or permanent residents of the United States.
Medicaid: On the other hand, people with low income may apply for Medicaid. It comes with a high income, and it depends on income and family composition. It is important to note that one should find out state Medicaid and need to study what that explains for you according to your state.
How to Apply for Medicare and Medicaid
So, there are processes to get started, especially for Medicare and Medicaid application process. But for Medicare, there are some issues, and it is important to know these issues and get started.
Medicare and Social security are interrelated and you need to enroll with social security directly to get Medicare Part A and Part B. when you are getting social security or railroad retirement board benefits, you may be eligible for Medicare generally at age 65. So Medicare Part A and Part B may be available for some people automatically, and some may need to sign up for it. For those who apply for retirement and disability benefits from Social security, this works as an application for Medicare. You can start getting Part A coverage when you are approved for social security. You will also be signed up for Part B because you pay a monthly premium for Part B coverage. But, you may choose to keep it or not. For Medicare Part C and Part D, you should enroll directly with the private insurance company for the plans you want.
More importantly, you should apply through social security, which is the easiest and fastest way to sign up. You may get any financial help when you feel the need. Indeed it is important to create your secure Social security account for signing up for Medicare and applying for social security benefits online. So it is going to be best to contact your local social security office.
When you opt for Medicaid, you need to visit your state’s Medicaid website and use the drop-down menu at the top side of the page. There is an instruction to pick your state, and you may get started with the application process. When you are eligible and can qualify, your coverage surely is going to start.
There are different programs and you need to fill out an application in the health insurance marketplace. After completing your application process, you will be informed about the programs for which you will qualify.
Cost-Sharing of Medicare and Medicaid
So, there is cost-sharing for both programs, which may be limited in terms of health care. Surely health care needs to be more affordable so that elderly and low-income people can save money to meet other basic needs. Considering this issue, cost-sharing for both programs is affordable and cheap.
- For Medicare: The people who get Medicare need to pay through payroll taxes as a premium when they are on the job. Sometimes, you may get help paying Medicare Part A and Part B deductibles, coinsurance, and co-payments. There may be conditions to qualify for these programs to help pay your Medicare premiums. There is also a Medicare savings program to make sure you can cover the cost of Medicare.
- For Medicaid: the State government has the option to make premiums for the Medicaid enrollees to establish out-of-pocket spending (cost-sharing) requirements. This can include co-payments, coinsurance, deductibles, and other similar charges. Maximum out-of-pocket costs are going to be limited. But this may be higher among higher-income people. Children and pregnant women are exempt from most out-of-pocket costs on whom co-payments, and coinsurance can’t be charged. You may contact your local office in your location to know the current premiums for Medicaid. A state may charge limited premiums and enrolment fees on the following groups of Medicaid enrollees.
Frequently Asked Questions
So there are so many questions about Medicare and Medicaid issues, and these will greatly let you know more. We have covered the questions that people always ask and want to know.
How is Medicare funded?
When you have a job and work, then you and your employer pay a 1.45% amount as tax, and it is used for paying Medicare. Additionally, there is also a premium for the enrollees who pay and contribute to the funding of Medicare.
How is Medicaid funded?
The federal movement always puts importance on health care for all people. For this, each state has spent on health care like Medicaid. If the state government provides $3 billion for its program, the federal government also contributes $3 billion. The total budget of the Medicaid program comes to $6 billion.
How do the programs differ?
In short, everyone wants to find the difference between Medicare and Medicaid. Both programs are health-related, but there is a specific group, and the program has been designed to meet the need of a specific type of people. Medicare is highly an insurance program and Medicaid is a social welfare program to bring low-income people under the health care system.
Is it possible to have Medicare and Medicaid both?
It is a common question who wants to have dual plans of Medicare and Medicaid. When you are 65-year-old and older, you can be eligible under Medicare. Then you may apply for the Medicaid program as well. So, you may have dual plans Medicare and Medicaid. When you have such plans, you should use Medicare first and then Medicaid because it covers the remaining expenses. In some states, dual plans may be available for all people on special consideration.
Who runs Medicare and Medicaid?
Medicare is a federal government program and it is run by the federal government. So, Medicare is mainly found as the same all over the country. Medicare is run by the Centers for Medicare and Medicaid services but it meets minimum federal standards. On the other hand, each state has a program of Medicaid, and this may vary according to state. But Medicaid must fulfill the aim of the federal government as it is jointly funded by the state government and federal government.
Both elderly and low-income people have options such as Medicare and Medicaid to help cover their health care costs. Surely the U.S. government should strengthen these historic and giant programs for the people. When enrolling in such programs, you should check out the local offices that can provide you with information for getting started. So you check out every detail according to your location. After getting enrolled in this program, you can save money that is supposed to spend on health care.