What is Medicaid and how is it different from Medicare?
Medicaid
Medicaid is the nation's major public health program for low-income Americans. Medicaid finances health and long term care services for more than 50 million people, provides health insurance for nearly 40 million low-income children and parents and is a critical source of acute and long-term care coverage for 12 million elderly and disabled individuals—including more than six million low-income Medicare beneficiaries. According to a 2004 Kaiser Family Foundation report, Medicaid accounts for 17% of all personal health care spending, finances 17% of hospital care, 12% of physician and other professional services, 17% of prescription drug spending, and nearly half of all nursing home care.
Although low-income children and their parents make up three fourths of Medicaid beneficiaries, they account for only 30% of Medicaid spending. The elderly and people with disabilities comprise one-quarter of beneficiaries and consume 70% of Medicaid spending for services.
Few issues of public policy have generated more concern amongst state and local lawmakers of late than the rising cost of Medicaid. A look at the facts, however, reveals that Medicaid costs have actually been rising more slowly than private health care rates. In addition, 70% of expenses go to cover the elderly and disabled. All over the U.S., Medicaid has also played a critical role in blunting the worst effects of the economic slump. Proposals to cut federal Medicaid spending would, if adopted, cut services to people in need and shift new burdens onto the state.
See the Centers for Medicare and Medicaid Services for more information on Medicaid.
Medicare
Medicare is a two-part, federally-funded program that offers health insurance to the elderly. It may cover people who've had kidney transplants or are being treated through dialysis or who have disabilities.
There are two parts of Medicare: part A and part B. Part A includes hospital insurance and part B is Medicare insurance.
Medicare Part A
Part A pays for necessary medical care and services given in Medicare-certified hospitals, skilled nursing facilities, home health agencies, and hospices. It does not cover doctor visits or prescription drugs. Part A is free if you qualify.
Medicare Part B
Part B helps pay for doctors, outpatient hospital care, ambulance transportation, and a variety of other tests and services. If you qualify, this costs $66.00 a month. You can pay from your Social Security, Railroad Retirement, or Civil Service check. If you qualify, your state may pay this part through Medicaid.
Part B pays 80% of most covered services. You must pay the remaining 20% percent. If you're treated by a doctor who doesn't accept Medicare, you have to pay.
Services provided by Medicare parts A and B combined include: inpatient care in hospitals, critical access hospitals, and skilled nursing facilities, some home health care and hospice care, sick patient doctor's visits, outpatient medical and surgical services and supplies, diagnostic tests, ambulatory surgery center facility fees for approved procedures, durable medical equipment, second surgical opinions, outpatient mental health care, and outpatient physical and occupational therapy.
Medicare does not currently cover the cost of prescription drugs. Depending on state regulations, Medicaid may cover the cost of prescription drugs for those who are "dually eligible" (eligible for both Medicare and Medicaid).
Medicare provides health insurance to adults who are at least 65 years old and people of any age with kidney disease and certain disabilities.
In order qualify for Medicare, you must fit into one or more of these categories:
- You or your spouse must have worked for at least 10 years in Medicare-covered employment and be at least 65 years old.
- You must qualify for or already receive retirement benefits from Social Security or the Railroad Retirement Board.
- You are under 65 and have been receiving Social Security or Railroad Retirement Board disability for the past 24 months.
- You're a kidney dialysis or transplant patient.
For more information contact la_womensissues @ uua.org.
Last updated on Tuesday, December 2, 2008.
