What is the Difference between Medicare and Medicaid?
Disabled individuals have access to two different types of medical insurance. One of the types of insurance is referred to as Medicare and the other is referred to as Medicaid. While both of these programs offer medical coverage, there are significant differences in the way the programs work and how a person becomes eligible to receive these benefits.
Medicare is an insurance program. When you pay Social Security taxes, you pay into the program that supports Medicare insurance. You are eligible to receive Medicare once you reach retirement age or become disabled. Medical bills are paid through a trust fund paid into by those who are covered under the program.
Medicare is split into four separate components—Part A, Part B, Part C and Part D:
- Medicare Part A provides hospitalization coverage.
- Part B works like regular medical insurance. It covers doctor’s visits, lab work and visits to the emergency room.
- Part C is privately purchased supplemental insurance that provides additional insurance beyond what Part A and B cover.
- Part D offers prescription drug coverage.
There are no income limits in order to qualify for Medicare. Patients pay part of the cost through deductibles for hospital visits and small monthly premiums. This is a federal program that is run by the Centers for Medicare and Medicaid Services. If you are not yet age 65 and you are disabled, you can begin receiving Medicare benefits 12 months after you begin receiving Social Security Disability Insurance benefits from the Social Security Administration.
Medicaid is a needs-based program. Through the Medicaid program, medical bills are paid through federal, state and local taxes. This program serves low-income individuals. There are no age requirements needed to qualify for Medicaid. Patients who receive Medicaid usually do not pay any cost for covered medical expenses, although a small co-payment is sometimes necessary for some services.
Unlike Medicare, which is federally-run, Medicaid is run at the state level with federal guidelines. There are also very different qualifying guidelines for Medicaid. Because Medicaid is a needs-based program, there are specific income and asset limits. The limits vary by state and by the number of dependents in a particular household. Having low-income, however, is not always enough to qualify for Medicaid in some states. Priority is usually given to pregnant women, families, children, the disabled and elderly. For example, a single male may make the same amount of money as a single, pregnant female, but the male may not qualify whereas the female will qualify due to the fact that she is with child and the child will also qualify once he or she is born.
Almost all Medicaid coverage allows for hospitalization, laboratory services, x-rays, doctor services, family planning, nursing services, medical and surgical dental services, clinic treatment, pediatric services and screening services. Some states also allow for the coverage of optometrist services, dental services and medical transportation.
Applying for Benefits
If you wish to qualify for Medicare, you must either receive Social Security Retirement benefits or Social Security Disability benefits. Your application is processed by the Social Security Administration. On the other hand, to qualify for Medicaid, you must apply through the state agency that handles applications for your local area, and it is a process separate from the disability application stages. You will need to bring in proof of your income and assets and will be either approved or denied based on whether or not you meet the guidelines that have been established by your state. Normally when an individual is approved for Medicaid, all individuals residing in the household begin to receive benefits as well.