Aware Senior Care Blog
If you’re looking for health care coverage past 65, learn the differences between Medicare and Medicaid to better understand what they cover, how to qualify, and which is best for you. Carol Marak, editor of SeniorCare.com, explains the differences between Medicare and Medicaid.
Aging matters – what is Medicare?
By Carol Marak, Editor of SeniorCare.com
If Medicare and Medicaid confuse you, welcome to bureaucracy. Millions of people are puzzled with the programs and unless you’re a long-term care expert, understanding the differences can be like looking through mud. Even today, I admit to being lost when reading all the parts that make up the insurance plans. And since they create a lot of mystery and confusion for many Americans, I’ll make an attempt to clearly address them and try to make some sense of it all. Hopefully, we’ll both gain a better understanding.
Medicare and Medicaid are government-sponsored. Each intended to help cover healthcare expenses. Since the names are so similar, people confuse the two and how they work, the coverages they offer, and the eligibility requirements. Basically, Medicare is health care insurance for persons over 65 and those living with certain disabilities. Medicaid is a joint federal and state program that helps cover medical costs for individuals with limited income and resources.
The funds to run both programs come from taxpayers.
A federal health insurance program that is available regardless of income. It has four parts:
Part A: Is a hospitalization insurance program for inpatient care in hospitals, skilled nursing facilities, Hospice care, and home health care. You wouldn’t pay a monthly premium for Part A if you or a spouse paid Medicare taxes while working.
Part B: It is a medical and health insurance program that pays for physician and other health care services. It also covers outpatient and home health care, durable medical equipment, and some preventive services. You pay the standard monthly premium out-of-pocket.
Part C: It is a private supplemental insurance that provides additional services.
Part D: Prescription drug coverage
The Different Parts of Medicare
Part C: It is called Medicare Advantage and it contains all benefits and services covered under Parts A and B and prescription drug coverage. Medicare Advantage programs is run by private insurance companies. The Medicare Advantage health plan contracts with Medicare to provide Part A and Part B benefits. If enrolled in a Medicare Advantage Plan, the Medicare services are covered through the plan and aren’t paid for under the Original Medicare.
Part D: A Medicare prescription drug coverage) covers the cost of prescription drugs and run by private insurance companies. It’s designed to lower prescription drug costs and protect against higher future costs.
is used by people enrolled in the traditional Medicare and run by private insurance companies. Its purpose is to pay for most of the out-of-pocket expenses in traditional Medicare like the 20 percent you pay for physician visits and outpatient services. It applies to the Part A hospital deductible ($1,260 in 2014 for each hospital benefits period.)
Medigap vs. Medicare Advantage
Only Medigap counts as “Medicare supplemental insurance” but Medicare Advantage plans give few extra benefits that supplements Medicare. When deciding to buy a Medigap policy or enroll in a Medicare Advantage plan, read the details of each. Pick the plan that best suits your needs and budget. Medicare has online programs to help you make these comparisons at Medicare.gov.
Note: For more information, visit socialsecurity.gov, call Social Security at 1-800-772-1213, or contact your local State Medical Assistance (Medicaid) office.
Medicaid also offers families with assistance that Medicare does not cover like skilled nursing home care and personal care services. Not all low-income persons qualify for Medicaid, and only about 40% of America’s poor rely on it today.
Medicaid sends payments to the health care providers for the services rendered. The states make these payments based on the fee-for-service arrangement and then receive compensation for a share of the expenditure from the feds. The states may impose minimal deductibles,coinsurance, orcopaymentsfor certain services.
Federal and State Governments
The feds control the crucial oversight of Medicaid, but each state:
-Inpatient and Outpatient Hospital services
-Physician services• Prenatal care
-Vaccines for the young
-Skilled nursing home services for individuals 21 or older
-Rural health clinic services
-Home health care for individuals who qualify to receive skilled–nursing services
-Laboratory and x-ray services
-Pediatric services• Ambulatory services
-Early and periodic screening, diagnostic, and treatment for children under age 21
The optional Medicaid services offered by states
-Intermediate care facilities for the mentally challenged
-Nursing facility services for individuals under 21
-Rehabilitation and physical therapy
-Home and community-based care to certain persons with chronic impairmentsContact Medicaid to learn the rules and benefits in your state at https://www.medicare.gov/Contacts/ and to see if you qualify.
Who is eligible for Medicaid?
Each state sets their eligibility requirements. But the program intends to serve people with the lowest incomes. Other factors include age, pregnancy status, disability status, other assets, and citizenship.
-People who meet the Aid to Families with Dependent Children requirements
-Pregnant women and children under six whose household income is at or below 133% of federal poverty
-Supplemental Security Income recipients
-Recipients of adoption or foster care assistance
-Other Medicare beneficiaries
If your income exceeds the Medicaid income set by your state, you still are eligible under the “spend down” process. Check with your state. For example, if you are “medically needy,” but have too much income, your state may approve your benefits. This process enables you to subtract the medical expenses from your income.To qualify as “medically needy,” your assets must meet the resource amount allowed in your state.
Carol Marak helped her parents with long-term care concerns and were the creator of the Aging matters column. If you have a question, or need help, Carol invites you to visit SeniorCare.com and complete the contact form on the site. Contact Carol.