Medicare and Medicaid are two of the biggest health programs in the United States. The last U.S. Census revealed that about 18.4% of Americans are on Medicare and about 17.8% of Americans are on Medicaid.
These two may sound similar but there is a big difference between Medicare and Medicaid.
What are the big differences between Medicare vs. Medicaid? This is your guide to understanding the two health programs better.
Medicare
Let’s start with Medicare. Here, the people that are primarily eligible for this are those who are U.S. citizens and are 65 years old or older.
While those are the main people that this program is for, Medicare can also cover those who have certain disabilities.
On top of the age and/or disability requirement, you typically have to work for at least ten years before you are eligible. Unlike Medicaid, Medicare does allow your spouse or your ex-spouse to be eligible for this.
However, Medicare does require you to pay premiums for certain types of coverage. This entirely depends on your income level along with any copays that may be necessary if you have to make a claim.
These premiums are mainly for things such as doctor’s visits or prescriptions rather than hospitalization, which a Medicare plan would cover without a premium.
There are four main parts of Medicare. Part A is mainly hospital insurance, Part B is medical insurance, Part C covers doctor’s visits, and Part D focuses on prescription drugs.
You should consider talking to a Medicare insurance broker to see what part may be right for you.
Medicaid
Unlike Medicare, Medicaid focuses more on the healthcare needs of those with lower income. It is a program that gives those that cannot afford health insurance on their own or for their dependents an opportunity to have coverage.
The poverty line is determined by how large your family is. For example, a family of two will have a poverty line of about $18,310. Meanwhile, a family of four would have a poverty line of about $27,750.
This is the program that benefits dependents, aka your children, more than Medicare would. The latter focuses more on the spouses.
Another difference with Medicaid compared to Medicare is that there are no premiums for this health coverage. On top of this, there are very few times where you would even have to pay a copay.
Unlike Medicare, the Medicaid program is focused more on a state-by-state basis whereas Medicare is more strictly federal. Part of the reason for this is because Medicaid is more based on income and every state has a different definition of the poverty line.
Know the Difference Between Medicare and Medicaid
This short guide should cover the difference between Medicare and Medicaid. One focuses on older citizens with no income eligibility while the other focuses on those who are on the poverty line at any age.
Do you want to find out even more about both programs? Read our Finance section for more information.