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You may be eligible for a government subsidy if your household income is under:
The Affordable Care Act (ACA) offers subsidies based on your household income, family size, and Qualifying Life Events.

You may qualify if...
One of the life events below has happened to you in the past 60 days:
  • I got married or divorced
  • I had a baby
  • A member of my family died
  • I moved to another state
  • i lost my job
  • I started a new job
  • I lost my health insurance coverage
and
Your income is under:
  • $45,960 - Individuals
  • $62,040 - Family of 2
  • $78,120 - Family of 3
  • $94,200 - Family of 4

Key Differences between Medicare and Medicaid

Medicare and Medicaid are two governmental health insurance programs that sound similar. The similarity may confuse you, but they’re entirely different programs. They usually cover different sets of people depending on age and income.

You don’t choose between Medicare and Medicaid. There are times when you might be eligible for both Medicare and Medicaid. One example is if you’re elderly and receive care in a nursing home. However, most people have either coverage depending on their age or income.

Let’s take a look at the two programs, how they differ and who’s eligible for each.

 

What is Medicare?

Medicare is a federal health insurance program available for people when they reach 65. The program is also for younger people with specific illnesses, such as end-stage renal disease (ESRD) and amyotrophic lateral sclerosis (ALS), also called Lou Gehrig’s Disease.

As you near 65, you’ll get information about Medicare. There are different types of Medicare plans. People either sign up for Parts A, B, and D or Part C (Medicare Advantage).

Here’s what Parts A, B, and D cover:

  • Part A (hospitals) -- This coverage protects you if you’re hospitalized.
  • Part B (doctors) -- The second part of what’s called Original Medicare, Part B handles your outpatient care, such as doctor appointments.
  • Part D (prescription drug coverage) -- Offered by a private company, Part D helps pay for prescription drugs. Part D is only available for people with Parts A and/or B. It’s not offered to those with Part C. Part C often has its own prescription drug coverage.

About one-third of Medicare beneficiaries have a Medicare Advantage plan. There are about 4,000 Medicare Advantage plans that cover more than 24 million people. A benefit of Medicare Advantage is it offers everything under one plan:

  • Part C (Medicare Advantage) -- Private insurance companies provide Medicare Advantage plans. These plans combine the coverage you’d get from Parts A, B and D. Medicare Advantage also provides supplemental benefits, such as vision, dental, and even population health initiatives, including transportation costs to doctors’ appointments. You can compare plans by their star rating. The Centers for Medicare and Medicaid Services (CMS) rates each plan. CMS gives the plan a quality rating of up to five stars. 

There’s another part of Medicare that’s an option for beneficiaries with Parts A and B. Medigap is a supplemental plan that helps you pay for your out-of-pocket Medicare services.

You have many options if you want a Medigap plan. These can vary by premium, deductible and out-of-pocket costs. 

A bonus to Medigap is that it may pay for international health care. So, if you travel to foreign countries and wind up needing health care there, your Medicare plan won’t cover it, but Medigap may pay up to 80% of the care costs.

 

What is Medicaid?

Medicaid is a federal/state health insurance program for low-income Americans. You have the same protections found in most employer-sponsored health plans.

Federal poverty level guidelines

Persons in HouseholdFederal poverty level for continental U.S.138% of federal poverty level
1$12,490$17,236
2$16,910$23,336
3$21,330$29,435
4$25,750$35,535

Regardless of the plan, the federal government requires Medicaid plans cover hospitalizations, home health care, physician appointments, labs and x-rays, maternity and pediatric and preventive care. Medicaid also covers child dental care.

Typically, Medicaid is available to anyone with an income below 100% of the federal poverty level. You may also be eligible if your income is below 200% of the federal poverty level and you’re pregnant, disabled, elderly, or a parent or caregiver.

Three dozen states have also expanded Medicaid eligibility. The Affordable Care Act allows states to expand Medicaid up to 138% of the federal poverty level. Other states are exploring the option, too.

Medicaid coverage can be provided by the state or private insurance company. Medicaid managed care, which is offered by a private insurer, has become increasingly common.

Even if you enroll in a Medicaid plan offered by an insurance company, you need to sign up through your state. 

 

Disability can make you dual eligible

You could be eligible for both if you’re on disability:

  • You’re eligible for Medicare if you’re on Social Security Disability insurance (SSDI). However, you have to receive two years worth of SSDI payments before becoming eligible.
  • You’re eligible for Medicaid if you’re approved for Supplemental Security Income (SSI). There’s no waiting period in that case, so you can get Medicaid immediately.

Key differences between Medicare and Medicaid

Medicare and Medicaid are public health insurance programs, but they differ in multiple ways. Here are some differences:

 

Eligibility

The biggest difference between Medicare and Medicaid is who’s eligible. Medicare is based on age or disability. Medicaid is based on income:

  • You’re eligible for Medicare if you’re 65 or over or have a specific illness.
  • You’re eligible for Medicaid If your income is below a certain level depending on your state.

You could be eligible for both if you meet income and age requirements for each program. Many people in nursing homes are eligible for both programs.

 

Medicare doesn’t have family plans

Another vital difference is Medicare doesn’t provide family coverage. So, if you’re on Medicare and you have a dependent, that person can’t get on your plan.
However, Medicaid covers dependents. In fact, Medicaid and the Children’s Health Insurance Program covers more than 45 million children.

 

Open enrollment

Medicare open enrollment is from Oct. 15 to Dec. 7. That’s the time you can make changes to your plan. You also have three months after you turn 65 to sign up for a Medicare plan.

Medicaid, on the other hand, doesn’t have an open enrollment period. Instead, you can sign up for a Medicaid plan any time of the year if you’re eligible.

 

Medicare gives many options

Medicare offers a wealth of choices. You may have dozens of Medicare Advantage options alone. There could be a similar number of Part D avenues for you.

Once you decide whether you want a Medicare Advantage or Original Medicare plus Part D, you’re able to narrow your focus and select the best Medicare plan for you.

Premiums, deductibles and out-of-pocket costs can vary greatly, so make sure you compare each cost.

Medicaid, on the other hand, will likely give you one or very few choices. That plan could be through the state, or it could be a managed care plan offered by a private insurer.

Differences aren’t just between Medicare and Medicaid. The different types of Medicare plans also vary. Here’s how Medicare and Medicaid plans compare:

Type of planWhat is coveredWho's eligibleWhen you can applyAverage monthly premiumOut-of-pocket/deductible
Medicare Part AHospitalizationPeople 65 and over and younger people with specific disabilities and people on SSDIDuring open enrollment and when you turn 65Most people pay $0$1,408 annual deductible
Medicare Part BPhysicians/outpatientPeople 65 and over and younger people with specific disabilities and people on SSDIDuring open enrollment and when you turn 65$144.60*$198 annual deductible and then pay 20% of Part B costs
Medicare Part C (Medicare Advantage)All health care, including supplemental benefitsPeople 65 and over and younger people with specific disabilities and people on SSDIDuring open enrollment and when you turn 65$23, but many plans have $0 premiumsOut-of-pocket max is $6,700 for in-network and $10,000 for out-of-network
Medicare Part DPrescription drug coverage for people with Parts A and B plansPeople with Parts A and/or BDuring open enrollment and when you turn 65$30Can't exceed $435 deductible. 
MedigapSupplemental coverage to help pay for out-of-pocket costsPeople with Parts A and/or BDuring open enrollment and when you turn 65Varies, can be less than $100Varies by plan
MedicaidAll health careBased on income, which varies by stateAnytimeDepends on income and can be as low as $0Minimal if any

 *Higher for people who file individual tax returns with income above $87,000 or joint tax returns more than $174,000.

How Medicaid works with Medicare

If you do have both Medicare and Medicaid, you don’t have to worry about which one pays first. There’s a system set up that decides the insurer that pays first. It’s called coordination of benefits (COB).

If you have both Medicare and Medicaid, which is common for people in nursing homes, Medicare pays for care first. Medicaid is considered the secondary payer. Just make sure to get care from providers that accept both plans. Otherwise, you could more pay out-of-network costs if the provider doesn’t take both.

 

Signing up for Medicare and Medicaid

If you’re eligible for Medicare, make sure you sign up for at least Medicare Part A. Part A is free to nearly all Americans, so you might as well take advantage of the coverage. The only people aren’t eligible for no-premium Part A are those who didn’t pay 10 years' worth of Medicare taxes.

If you’re still working or on your spouse’s insurance, you may decide to stay on that plan for physician services and wait to sign up for Part B until later. You can do that, but beware that you may pay higher premiums once you sign up for Part B. CMS will charge you a 10% premium penalty for every 12 months that you don’t enroll in Part B. That penalty will get added to your premiums once you get Part B.

Here’s another reason to sign up for Medicare when you turn 65. You may have to wait until the open enrollment period if you don’t sign up when you become eligible.

Getting covered by a Medicare or Medicaid plan is simple. Whether you need a Medicaid or Medicare plan, an excellent place to start is the federal health care site. That will direct in the right direction depending on your situation.

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Find Affordable Health Insurance Now!

Please enter valid Zip Code.
Please enter valid date.
You may be eligible for a government subsidy if your household income is under:
The Affordable Care Act (ACA) offers subsidies based on your household income, family size, and Qualifying Life Events.

You may qualify if...
One of the life events below has happened to you in the past 60 days:
  • I got married or divorced
  • I had a baby
  • A member of my family died
  • I moved to another state
  • i lost my job
  • I started a new job
  • I lost my health insurance coverage
and
Your income is under:
  • $45,960 - Individuals
  • $62,040 - Family of 2
  • $78,120 - Family of 3
  • $94,200 - Family of 4
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