Medicaid vs Medicare: What Are the Differences? 

Medicaid and Medicare are two government-funded health insurance programs, but they serve different populations and cover different types of health care services. Medicare is primarily for certain disabled individuals or those who are 65 years of age or older, while Medicaid is for low-income individuals and families, and covers a wider range of health care services including long-term. In this article, the New Jersey Medicaid attorneys at The Chamberlain Law Firm will outline both programs and explain their differences.

What is Medicaid?

Medicaid is a government-funded health insurance program that provides coverage to eligible individuals and families with low incomes. It is jointly funded by the federal government and individual states, and each state has the flexibility to design and administer its own Medicaid program within federal guidelines. 

Medicaid covers a wide range of health services, including doctor visits, hospital stays, prescription drugs, and long-term care. Medicaid eligibility and covered benefits vary by state, but the program is designed to help those who are unable to afford private health insurance.

Medicaid Eligibility

Eligibility for Medicaid is based on several factors, including income, assets, and personal circumstances. The exact criteria for Medicaid eligibility varies from state to state, but generally, the program is available to people with low incomes, including:

• Children,
• Pregnant women,
• Parents and caretaker relatives,
• People with disabilities,
• Elderly individuals, and
• Individuals who are eligible for Supplemental Security Income (SSI).

In addition to income, some states also consider factors such as citizenship status, residency, and household size when determining eligibility for Medicaid. The Affordable Care Act (ACA) expanded Medicaid coverage to include more people, but some states did not adopt the expansion. It’s important to note that each state sets its own eligibility standards, so it’s best to check with your state Medicaid agency for specific information on eligibility in your area.

What Services Does Medicaid Cover?

Medicaid covers a wide range of health care services, and the specific services covered vary by state. However, federal law requires that certain services be covered by all state Medicaid programs, including: 

• Inpatient and outpatient hospital services,
• Physician services,
• Laboratory and X-ray services,
• Nursing facility services for individuals 21 years of age and older,
• Home health services for individuals who are eligible for nursing facility services, and
• Rural health clinic and Federally Qualified Health Center services.

In addition to the mandatory services, states have the option to cover additional optional services. These optional services include:

• Prescription drugs,
• Dental care,
• Physical therapy,
• Occupational therapy,
• Speech and hearing services, and
• Vision services.

Medicaid also covers long-term care services for eligible individuals who require assistance with activities of daily living, such as bathing, dressing, and eating.

Medicaid’s Long-Term Care Services

Specific long-term care services covered by Medicaid vary by state, but they typically include:

• Nursing home care: Medicaid covers room and board, as well as nursing and rehabilitation services, in a Medicaid-certified nursing home.
• Home- and community-based services (HCBS): Medicaid covers a variety of services that help individuals with disabilities and older adults live in their own homes or communities, including personal care services, homemaker services, and adult day health services.
• Assisted living services: Medicaid may cover some or all of the costs of assisted living services for eligible individuals who require help with activities of daily living but do not need the level of care provided in a nursing home.
• Hospice care: Medicaid covers hospice care for individuals who are terminally ill and have a life expectancy of six months or less.
• Respite care: Medicaid covers respite care, which provides temporary relief to caregivers who are caring for individuals with disabilities or older adults.

It’s important to note that Medicaid coverage for long-term care services is subject to certain eligibility requirements, and the extent of coverage may vary by state. For example, some states have asset and income limits that must be met in order to be eligible for Medicaid-covered long-term care services.

What is Medicare?

Medicare is a federal health insurance program that provides coverage to eligible individuals who are 65 years of age or older, as well as individuals with certain disabilities. Medicare is funded by a combination of payroll taxes, premiums, and general tax revenues. It is designed to cover the cost of necessary health services but does not cover all health care expenses. 

Medicare Eligibility

In general, an individual is eligible for Medicare if he or she meets one of the following criteria:

• Age 65 +:  Individuals who are 65 years of age or older and are citizens or permanent residents of the United States are eligible for Medicare.
• Disability: Individuals who have received Social Security Disability Insurance (SSDI) benefits for at least 24 months are eligible for Medicare. Individuals with End-Stage Renal Disease (ESRD) or Amyotrophic Lateral Sclerosis (ALS) may also be eligible for Medicare based on their disability.
• End-Stage Renal Disease (ESRD): Individuals with ESRD, or permanent kidney failure requiring dialysis or a kidney transplant, are eligible for Medicare regardless of their age.

It’s important to note that individuals who are eligible for Medicare based on age or disability must also meet certain residency requirements. To receive full Medicare benefits, individuals must have lived in the United States for at least five consecutive years. In some cases, individuals who have lived in the U.S. for less than five years may still be eligible for Medicare, but their benefits may be limited. 

What Services Does Medicare Cover?

Medicare coverage is broken into four parts, each of which covers different types of health care services. The Medicare parts include:

• Part A (Hospital Insurance): covers inpatient hospital care, skilled nursing facility care, hospice care, and some home health care services.
• Part B (Medical Insurance): covers services from doctors and other health care providers, as well as outpatient care, medical supplies, and preventive services. Part B also covers some home health care services, but it does not cover long-term care services, such as those provided in a nursing home.
• Part C (Medicare Advantage): an alternative to traditional Medicare that allows beneficiaries to receive their Medicare benefits through a private health plan. Medicare Advantage plans must offer at least the same benefits as original Medicare, but they may also offer additional benefits, such as coverage for prescription drugs and routine dental care.
• Part D (Prescription Drug Coverage): provides coverage for prescription drugs through private insurance plans that are approved by Medicare.

It’s important to note that Medicare does not cover all health care expenses. For example, Medicare does not cover routine dental care, routine vision care, hearing aids, or long-term care services. 

Does Medicare Provide any Coverage for Long Term Care Services?

Unlike Medicaid, Medicare does not provide comprehensive long-term care services, such as those provided in a nursing home or assisted living facility. Medicare Part A (Hospital Insurance) covers limited skilled nursing facility care and some home health care services, but it does not cover custodial care (assistance with activities of daily living such as bathing, dressing, and eating), which is the type of care typically provided in a nursing home or assisted living facility.

Can You Be Eligible for Both Medicaid and Medicare?

Yes, it is possible to receive services from both Medicaid and Medicare. This is known as being “dual eligible.” Dual eligibility occurs when an individual is eligible for both Medicaid and Medicare, typically because they have a low income and are also 65 years of age or older or have a disability.

Dual eligible individuals may receive their health coverage through both programs, with Medicaid covering certain services that are not covered by Medicare and helping to pay for Medicare premiums and cost-sharing. For example, Medicaid may cover long-term care services that are not covered by Medicare, and it may also help with the cost of Medicare deductibles and coinsurance.

Since services offered by Medicaid and Medicare as well as eligibility differs depending on the state, it is always best to contact your local state agency for specific information on eligibility and covered services in your area.

This article is for informational purposes only. It is not intended as legal advice. In the event you would like to speak with a lawyer about the specifics of your case, contact The Chamberlain Law Firm at (201) 273-9763 to schedule a consultation.