Myth vs. Fact: Medicare and Medicaid are Essentially the Same Thing

Government programs such as Medicaid and Medicare help people pay for healthcare. People sometimes confuse how the two programs work and the services they provide because they have similar names. In 1965, the federal government created both programs funded by taxes, but the programs and the coverage they provide are very different.

The laws and policies that govern each set differ, and the programs cater to a diverse range of people. The two programs are, however, mutually exclusive.

Knowing how Medicare and Medicaid differ is important for determining which program is best for your needs.

How does Medicare work?

Medicare is a health insurance program for people 65 and older, and disabled residents of the United States who have difficulty paying the costs associated with medical care and treatment. Financial assistance is available through this program to enrollees and their families.

In certain circumstances, individuals under age 65 with disabilities may qualify for Medicare benefits. The eligibility requirements and details of each program are taken into account when evaluating each case. You can also apply for Medicare benefits if you have kidney disease in the last stage.

There are several parts to Medicare, Part A, Part B, Part C, Part D and Medicare Supplement.

Original Medicare

A primary insurance option for many older Americans is original Medicare, also known as Part A and Part B, which is a government-funded program. Services covered include:

Medicare Part A:

Medical services in an inpatient hospital. In addition to hospital visits, hospice care, and limited at-home care, these benefits include coverage for hospice care.

Medicare Part B:

Services for outpatient medical treatment. Benefits covered include prevention, diagnosis, and treatment of health conditions.

What is Medicare Advantage?

Medicare Advantage (MA), also known as Medicare Part C, is for individuals who want Original Medicare plus additional coverage.

Private insurance companies provide Medicare Advantage plans. These plans provide additional coverage to fill in the gaps that Original Medicare does not cover. Often these plans cover services not covered by Original Medicare, such as prescription drug coverage, dental, hearing and vision. MA plans often have a provider network so it will be important to make sure your providers are in network.

What Medicare Supplement or Medigap plans?

Medicare Supplement plans also fill gaps that Original Medicare does not cover, and are purchased through private insurance companies. Unlike MA plans, they do not offer any additional benefits and they do not have prescription drug coverage.

Medicare Supplement plans however have some attractive benefits, such as the ability to see any provider that accepts Medicare.

What about Prescription drug coverage?

Medicare Part D is prescription drug coverage that can be purchased as a stand alone plan or as part of a Medicare Advantage plan. You will want to check with your trusted Medicare advisor to make sure you are making the right choice when it comes to your prescription coverage.

How does Medicaid work?

Medicaid is a program administered by the state and federal government to help low-income families afford health care. Hospitalizations, treatments, and routine medical care are included in these costs.

Thousands of children, adults, and persons with disabilities receive services through the program every year. Medicaid covered 72,204,587 adults in November 2020, and the Children’s Health Insurance Program (CHIP) covered 6,695,834 kids.

Can You Qualify For Both Medicare and Medicaid?

A dual eligible person is one who is eligible for Medicaid and Medicare. A Medicare Part D plan will cover your prescription drugs if you have Original Medicare (parts A and B) or a Medicare Advantage plan (part C).

Having both Medicare and Medicaid may cover your healthcare costs to a great extent since Medicare may not cover all your needs.

 In order to support you in choosing the right health plan, Guided Medicare provides accurate and comprehensive information about every health plan available. Contact a representative today to discuss your health insurance needs.


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