The Key Difference Between Medicare and Medicaid

The Key Difference Between Medicare and Medicaid

Medicare and Medicaid are two of the United States’ biggest health insurance plans, with the two programs covering about 33% of Americans in total.

While most people have heard about both programs, it can be hard to differentiate between the two, making it difficult to shop for the right healthcare plan for your needs.

Not to worry, we’re here to help! Below, you’ll find a quick breakdown of the difference between Medicare and Medicaid, as well as some tips to help you make the most of your healthcare plan.

Medicare

What is Medicare, you may wonder? Think of it as a national safety net for people aged 65 and up. In addition, some younger citizens with debilitating illnesses may qualify.

It’s a government-run form of healthcare intended to provide the elderly with affordable and comprehensive coverage.

What’s more, you’ve paid into Medicare for years without even knowing it, as it’s a taxpayer-funded program.

In total, there are four parts of Medicare you’ll need to understand. It’s a lot more than we have time to delve into, but here are the basics:

  • Medicare Part A: inpatient treatment
  • Medicare Part B: outpatient treatment
  • Medicare Part C: an optional plan known as Medicare Advantage
  • Medicare Part D: prescription drugs and other medication coverage

Medicare Part C often combines elements of parts A and B.

Medicaid

Though Medicaid has fewer age requirements than Medicare, it’s only accessible to low-income individuals and families.

Each state has different income restrictions, so make sure to see what your state website says.

Medicaid is a basic healthcare option that covers just about anything you’d need, from general physician care to hospital stays and medication coverage.

You can even qualify for specialty services like dental care and mental health treatment.

Finding the Right Plan

Every year, Americans spend a total of $980 billion on coverage.

To keep from overspending, you’ll need to consider what types of care you’ll require most often. For instance, you’ll certainly want to invest in basic coverage to help pay for things like annual physicals and general practitioner visits.

However, it’s often worth it to invest a bit more so you can lower your deductible, which is the amount you’ll have to pay out of pocket before your insurance kicks in.

Another factor to consider when shopping around is whether you’ll need a Medicare Advantage plan. This type of coverage allows you to supplement your care with additional protections, including vision and dental.

If you’re interested in learning more about how supplementary plans work, check out this link to learn more about changing medicare advantage plans.

Understanding the Difference Between Medicare and Medicaid

To quickly recap, the difference between Medicare and Medicaid comes primarily from its intended recipients.

Medicare is for older individuals who are likely to retire. Medicaid’s target audience is low-income households looking for basic coverage.

Whichever you choose, remember that you can always invest in supplementary insurance like a Medicare Advantage plan to fill in any gaps.

For more healthcare tips, make sure to check out the rest of our blog!

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