Medicare and Medicaid – Which one is for You?
An amendment to the Social Security Act in 1965 saw the birth of Medicare and Medicaid. They are both government-run health programs intended to cover the healthcare costs for deserving American citizens. Although these programs might trigger confusion over how they work due to the similar-sounding names, they are technically different, are designed for different types of people, and have their own regulations and policies on how they are run.
The key differences between Medicare and Medicaid can be boiled down to what services they cover, who runs them, how much the users pay for them, and who qualifies for them. This article will help you get an understanding of these two programs, with the ability to choose the right one for your needs.
Medicaid is largely a public assistance program that is based on the financial needs of the individual. This means that it is supported and paid for using public funds collected through taxes on the federal and state level. The program seeks to provide health insurance to those Americans who have low incomes.
Medicaid supports people irrespective of their age and covers the major healthcare expenses such as hospitalization & treatment, and minor routine checkups as well. This program helps those who cannot afford to pay for themselves quality medical care and may not have other medical covers.
Medicare is designed to help senior US citizens and their families to access quality medical care. It covers people who are over the age of 65 and face financial constraints when seeking special medical care and treatment. The program is also available to people below the age of 65, but only under specific circumstances for those with certain disabilities and illnesses such as amyotrophic lateral sclerosis (ALS) and last-stage renal disease (ESRD).
The Crucial Variances between Medicare and Medicaid
The biggest difference between Medicare and Medicaid depends on who is eligible for the program. Medicaid is based on one’s income while Medicare is available to those aged above 65 years and (or) have selected disabilities and illnesses. You can, however, be eligible for both if you meet the age limit and the financial caps.
Medicare -: There are various different types of Medicare plans which one can sign up for, including four parts A, B, D, and part C.
Below is the breakdown of what all these parts cover:
Part A (Hospital) – Part A of Medicare covers you if you have been hospitalized.
Part B (Doctor) – Part B covers your doctor’s fees such as outpatient care. It is sometimes referred to as the “Original Medicare”.
Part D (Prescription drugs) – Part D is available to those who have coverage of Parts A and B. It caters for the prescription drugs. Part C has its own cover for prescription drugs.
Part C (Medicare Advantage) – Part C is also known as the Medicare Advantage plan and is offered by private insurance companies. This plan combines all the coverage you would get from Parts A, B, and D and comes with extra benefits such as dental, vision, and population health initiatives.
Another plan available for the beneficiaries who have Parts A and B is Medigap. This is a supplemental cover which prevents any expense that might have come out of your own pocket. Such a plan also comes in handy when you require medical cover abroad.
Medicaid: The coverage one gets from Medicaid varies from one state to another. However, there are some basic benefits one stands to receive from Medicaid such as-:
- Clinic treatment
- X-ray and Laboratory services
- Doctor and nursing services
- Family planning & midwife services
- Home healthcare
- Pediatric services
- Screening and diagnostics, and treatment for people under 21
- Medical and surgical dental services
Costs Incurred by Users
Medicaid is available free to users, however, there can sometimes be small charges for certain services. There is an annual deductible for those on the Medicare plan. Taking into consideration the various parts of the plan, here are a few of the charges you might incur.
- Part A – Copayments might be made for a lengthy hospitalization.
- Part B – A monthly premium is paid, plus 20% to 35% of the medical bills.
- Part C – The charges vary from one provider to another.
- Part D – A monthly premium and 25% of the total drug costs.
Understanding the difference between Medicare and Medicaid is simple. The bottom line is that Medicare is available only to US citizens over 65 years and those who have particular illnesses and disabilities. Medicaid is available to people based on their income or family status.