Page Reviewed / Updated - May 2016
Medicare is a federal health insurance program open to Americans aged 65 and older, and those with specific disabilities who are under the age of 65. Medicaid, a combined state and federal program, is a state-specific insurance program for low-income individuals with limited financial assets, regardless of their age.
Medicare, generally speaking, offers the same benefits to all eligible participants. However, coverage is divided into Medicare Part A, Part B, and Part D. Medicare Part A is for hospice care, skilled nursing facility care, and inpatient hospital care. Medicare Part B is for outpatient care, durable medical equipment, and home health care. Part D is for prescription coverage. Not all persons will elect to have coverage in all three areas.
Medicaid is more comprehensive in its coverage, but the benefits are specific to the age group. Children have different eligibility requirements and receive different benefits from low-income adults and from elderly or disabled persons.
In the context of long term care for the elderly, Medicare’s benefits are very limited. Medicare does not pay for personal care (also known as custodial care or non-medical care). Medicare will pay for a very limited number of days of skilled nursing (also referred to as nursing home care). Medicare will also pay for some home health care, provided it is medical in nature.
Medicaid, being state run, has different benefits in each state. Generally speaking, Medicaid pays for nursing home care and through waiver programs, pays for home care, personal care and assisted living. To avoid confusion, it is worth noting that Medicaid is referred to by different names in different states. For example, in California it is called Medi-Cal, in Kansas it is called KanCare, and in Massachusetts it is called MassHealth.
|Eligibility in 2016||Medicare||Medicaid|
|Age Limit||65 and older||No age limit|
|Income Limit||No income limit||Approximately $2,199 / month*|
|Asset Limit||No asset limit||Approximately $2,000**|
|Health Restrictions||None||Some depending on program / waiver|
Yes, these are not mutually exclusive programs. These persons are referred to as having Dual Eligibility, Dual Eligibles or often simply “Duals”. Typically, Medicaid will pay for their Medicare premiums and co-payments. In fact, many states have special programs intended to make it easier for seniors to manage their dual eligibility status as it can be confusing to know where to turn for what services.