The Medicare and Medicaid health-care programs may seem similar, but there are some key differences between them. Let's explore each program, including their coverage offerings and eligibility requirements.
What Are Medicare and Medicaid?
President Lyndon B. Johnson's administration established Medicare and Medicaid in 1965 to help older and low-income Americans buy private health insurance. The federally-run Medicare program covers people age 65 and older and younger people with disabilities or end-stage renal disease. States manage Medicaid under federal funding and guidelines. It covers many people of all ages with a low income. In Maine, Medicaid is known as MaineCare, and some other states have their own names for their Medicaid programs.
What Do Medicare and Medicaid Cover?
Both programs pay for certain health-care services, which include hospital stays and office visits.
Medicare was originally divided into Parts A (hospital insurance) and B (medical coverage). Supplemental Parts C (Medicare Advantage) and D (medications) provide coverage through private insurance companies that you usually pay for yourself. Here we will focus only on the main parts of Medicare.
Part A covers hospital care and a limited period of nursing home care, home health services, and hospice care. Part A will pay for nursing home care only if:
1. There was first a qualifying hospital stay of three days of inpatient care;
2. Nursing home care related to the hospital stay was needed; and
3. The patient entered the nursing home shortly after the hospital stay (usually within 30 days).
Afterward, Part A pays for only the first 20 days of nursing home care. Days 21 through 100 of care require partial payment from the patient. After 100 days, Medicare won't provide coverage.
Medicare Part B covers traditional outpatient health-care, such as doctor visits, blood tests, and X-rays. Often, patients don't need a referral to see a specialist.
Recipients might need to pay premiums and co-pays. Those with a higher income could need to pay more of the costs.
Medicaid (or in Maine, MaineCare), however, pays for most types of medical care and services, including long-term care and transportation for visits. Optional benefits can include prescription drug coverage, case management, and physical or occupational therapy. Medicaid plans and coverage differ from state to state and sometimes by county. Each state may decide which benefits to cover. In Maine, some services or equipment can require prior approval for coverage.
The Medicaid program is often free, but the recipient may need to pay low co-pays for some services depending on the plan. After a Medicaid recipient dies, the program can seek to recover any assets from their estate.
Despite the differences in coverage and eligibility requirements, it's possible to qualify for both programs and pay less for health-care.
How Do You Become Eligible for Medicare or Medicaid?
Eligibility may be simpler under Medicare than Medicaid. Medicare has no income eligibility requirements. People who are older than age 65 and have paid Medicare taxes through their employment for at least ten years (or 40 qualifying quarters) generally qualify for Medicare. You can get Medicare Part A at age 65 for free if:
• You receive Railroad Retirement Board benefits;
• You are eligible to receive Railroad Retirement Board benefits or Social Security benefits but have not yet filed for them; or
• You or a spouse had Medicare-covered government employment.
Even if you or a spouse didn't pay Medicare taxes, if you're age 65 or older and a U.S. citizen or permanent resident, you may be able to pay for Part A.
If you're under age 65, you can get Part A without having to pay premiums if:
• You have been entitled to Social Security or Railroad Retirement Board disability benefits for 24 months; or
• You are a kidney dialysis or kidney transplant patient.
Medicare Part B eligibility is the same as for Part A, but Part B requires a paid premium and co-pays. You must also meet deductibles. The federal government deducts the premium payment from your Social Security, Railroad Retirement, or Civil Service Retirement check. Otherwise, Medicare will bill you for Part B premiums every three months. If you don't sign up for Part B when you first become eligible, you may face a delay in coverage and a financial penalty. Those with a limited income and assets can qualify for state aid to pay for Part A and/or Part B.
To determine if you're eligible and need to pay for insurance, use the Medicare.gov eligibility tool.
Under Medicaid, as long as your income meets or is below the required levels, you may qualify for coverage. To get long-term care through Medicaid, you must also meet asset restrictions. And there is a "look-back" period; for example, if you transferred assets, including any financial gifts within a certain time frame (in Maine, it's five years), your coverage could be limited for a certain time. Elder law attorneys, such as the team at Levey, Wagley, Putman & Eccher, P.A., can help you protect your assets and manage any prior transfers while you qualify for benefits.
We would be happy to help you apply for health insurance under either program or answer any of your questions. Contact us online or call (207) 377-6966 today.