Differences Between Medicare and Medicaid

Many people are confused about Medicare and Medicaid including the question of what the differences are between the programs.  There are some major differences between the two, but they are easy to sort out.

Medicare is a program that is funded by the federal government as an entitlement program, which mainly focuses on the older population.  It is a social insurance program for individuals age 65 and over and it also covers medical bills of many individuals with disabilities. Medicare also covers individuals of all ages with end stage renal (kidney) disease.

There are several parts to Medicare.  Part A covers hospital bills, Part B covers medical insurance and Part D covers prescriptions.  There are other parts, as well, and they act as supplements, however, that discussion is for a different article.

Medicaid is different from Medicare in several ways.  Medicaid is also an entitlement program, however, Medicaid is not funded only by federal government, there is a state component as well, and in some states, counties pay part of the cost, too.

Medicaid is based on need and social welfare, with eligibility based on income. If a person has limited income and/or limited financial resources, Medicaid covers a broader amount of services than Medicare does.  It usually covers children, pregnant women, parents of eligible children, seniors and individuals with disabilities.  Though poverty is used to determine eligibility, a person must fall into one of the other coverage groups in addition to being determined eligible due to being in poverty.  Medicaid benefits are paid directly to the provider of services.  So, if you go to the doctor, the doctor gets the payment, if you go to the pharmacy, Medicaid pays the pharmacy directly.  In addition to covering individuals who meet financial requirements, in some states Medicaid covers individuals who cannot otherwise afford insurance.

Some individuals qualify for coverage by both programs.  For more information regarding Medicare and Medicaid, go to www.medicaid.gov or www.medicare.gov  or simply go to Google or another search engine and type in Medicare or Medicaid and you will get pages of information.

Filed under: General-Medicare

Tags: federal government, General-Medicare, limited income, medicaid, state government