Medicare vs. Medicaid: Who Qualifies and What They Cover
Medicare and Medicaid are both government health programs, but they serve very different populations and have distinct rules. Confusing them can lead to missed benefits or unexpected costs. This guide clarifies who qualifies for each program, what they cover, how they’re funded, and whether you can have both at the same time.
What Is Medicare?
Medicare is a **federal health insurance program** primarily for:
- People aged 65 and older
- Certain younger people with disabilities (after 24 months of Social Security Disability Insurance)
- People with End-Stage Renal Disease (permanent kidney failure)
What Is Medicaid?
Medicaid is a **joint federal and state program** that provides health coverage to **low-income individuals and families**, including:
- Pregnant women
- Children
- Parents and caretakers
- Elderly adults with limited income
- People with disabilities
Key Differences at a Glance
| Feature | Medicare | Medicaid |
|---|---|---|
| Administered by | Federal government (CMS) | State governments (with federal oversight) |
| Eligibility based on | Age or disability | Income and household size |
| Premiums | Yes (Parts B and D) | Usually $0 or very low |
| Covers long-term care | Limited (only short-term skilled nursing) | Yes (nursing homes, home care) |
Medicare Parts Explained
Medicare has four main parts:
- Part A: Hospital insurance (inpatient care, skilled nursing, hospice). Most people pay $0 premium if they or their spouse paid Medicare taxes for 10+ years.
- Part B: Medical insurance (doctor visits, outpatient care, preventive services). Requires a monthly premium (about $175–$500+ in 2025, based on income).
- Part C: Medicare Advantage—private plans that bundle Parts A, B, and usually D.
- Part D: Prescription drug coverage (standalone or included in Part C).
When Can You Have Both?
About 12 million Americans are “dual eligible,” meaning they qualify for both Medicare and Medicaid. In this case:
- Medicare pays first
- Medicaid covers remaining costs (premiums, deductibles, copays)
- Medicaid may provide extra benefits Medicare doesn’t cover (e.g., dental, vision, long-term care)
How to Apply
Medicare: Automatic at 65 if you’re already receiving Social Security. Otherwise, sign up during your 7-month Initial Enrollment Period (3 months before to 3 months after your 65th birthday).
Medicaid: Apply anytime through your state’s Medicaid agency or Health Insurance Marketplace. Approval can take 30–45 days.
Common Misconceptions
“Medicaid is only for children.”
While many enrollees are children, over one-third are adults—including seniors in nursing homes.
“Medicare covers all my medical costs.”
Original Medicare has no out-of-pocket maximum. Without supplemental coverage, you could pay thousands annually.
“You can’t qualify for Medicaid if you own a home.”
In most cases, your primary residence is exempt from asset tests for Medicaid (though estate recovery may apply after death).
Key Takeaway
Medicare is about **age and disability**; Medicaid is about **financial need**. They work differently, but can complement each other for those who qualify for both. If you’re approaching 65 or have low income, research your options early—enrollment mistakes can lead to gaps in coverage or late penalties.