What Is the Difference Between Medicare and Medicaid?

Medicare and Medicaid are two separate government health programs that are often confused. Medicare is a federal program primarily for people 65 and older, along with certain younger people with disabilities or specific conditions. Eligibility is based mainly on age and work history, not income.

Medicaid is a joint federal and state program that helps people with limited income and resources pay for healthcare. Eligibility rules and covered benefits vary by state, and Medicaid often covers services that Medicare does not, such as long-term custodial care. Because it is income-based, Medicaid generally has very low or no cost to those who qualify.

Some people qualify for both programs and are called dual eligible. In that case, Medicare pays first and Medicaid can help with costs Medicare does not cover, such as premiums, copays, and deductibles. There are also special plans designed for people with both. If you think you may qualify for both, a licensed Medicare advisor can help you understand your options and how the two programs work together.

In short, the easiest way to remember the difference is that Medicare is mainly age-based and federal, while Medicaid is income-based and runs through the states. The two are not mutually exclusive, and qualifying for one does not prevent you from qualifying for the other. Understanding which program or combination applies to you can help you access more complete coverage at a lower cost.