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The Difference between Medicare and Medicaid

Medicare and Medicaid are both federal healthcare programs, but there are some major differences between the two. These differences primarily have to do with who runs them, who qualifies for them, how much users pay and what services they cover.

Medicaid is a federal program that is administered separately by each state. This is not the only difference between it and Medicare, however. Medicaid covers low-income people who do not have the financial means to afford healthcare, while Medicare applies to everyone who has paid into the system and reached the point of eligibility.

Medicare seeks to address the problem of the elderly having high medical bills, but increasingly limited means. Medicare recipients pay into Medicare through payroll or self-employment taxes.

While it's possible to qualify for both at the same time, each program has its own set of requirements, so you won't be able to enroll in one just because you qualified for the other.

This table contains a breakdown of the differences between Medicare and Medicaid:

 

Medicaid

Medicare

Who Runs It

Medicaid is a federal program administered by the states. Information is available at your state's health services office.

Medicare is a federal program with uniform, national rules.

Eligibility

Low-income people can qualify, regardless of age.

Medicare benefits can begin as early as age 62, or even earlier in the case of serious disability covered by Social Security.

Coverage

Medicaid covers basic health care costs such as visits to the doctor and hospital stays, but can also cover things like the cost of eyeglasses.

Part A -- hospital and post-hospital facility charges, as well as home health care

Part B -- doctor fees and lab costs, outpatient care (can include physical therapy and medical equipment )

Part D -- prescription drug coverage

Costs

Medicaid sometimes charges its users small fees for certain services.

Medicaid will often pay for Medicare deductibles and premiums, and it can cover the 20% of medical costs that Medicare will not pay for.

There is a yearly deductible for all three Medicare plans.

Part A -- copayments for lengthy hospitalizations

Part B -- 20 to 35% of medical bills, plus a monthly premium

Part D -- for 2011, there is a coverage gap such that Medicare will not cover total drug costs after they exceed $2,840, but will resume coverage once total drug costs reach $4,550.

Beneficiaries must also pay a monthly premium and 25% of drug costs once the deductible is met.

Next Steps
Contact a qualified health care attorney to help
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