Medicare Vs Medicaid: Which One Is Better?

Medicare and Medicaid are two government-sponsored health insurance programs for people who are 65 years and older, and who meet certain low-income requirements, respectively. There is a consensus that Medicare is better than Medicaid. Medicare has fewer restrictions, denying fewer people care they need since it's available for all seniors who are 65 or older regardless of income. Medicaid is restricted to low-income people under the age of 65 who are either pregnant or care for young children, disabled, or elderly individuals. However, both programs have their advantages and disadvantages.

What is Medicare and what does it cover?

Medicare is the federal health insurance program for people aged 65 and over, people under age 65 who have certain disabilities, and people of all ages with end-stage renal disease (permanent kidney failure requiring dialysis or a transplant, sometimes called ESRD). According to Medicarewire.com, Medicare was created in 1965 and it is funded by taxes imposed on wages and self-employment income and by premiums paid by Medicare beneficiaries. Anyone who has worked and paid Medicare payroll taxes for forty quarters (about ten years) is eligible, even if the individual does not wish to receive Social Security benefits at age 65. This is called "working after eligibility."

However, there are exceptions to this rule. Employees who work for an employer that has fewer than 20 workers and who make an average of $50,000 per year or less (adjusted annually for inflation) over the entire period in which they work and pay Medicare taxes are not eligible for Medicare when they retire. This is called the "working exception." If you have Medicare based on your work record, you can continue to be covered by Medicare even if you leave the workforce and take up other work. However, if you are still working but your employer has 20 or more employees and your total income exceeds $200 per month, Medicare will not pay for any part of your health care costs until you reach age 65. At that time, you may decide to stay with your employer's insurance plan. But once you reach age 65 and begin receiving Social Security benefits, you can choose either Medicare or your employer's health plan.

What medical care is covered by Medicare?

Medicare pays for many different kinds of medical services. These include hospital stays, surgeries, lab tests, X-rays, some home health services, hospice care for the terminally ill, and certain other medical services performed by physicians. Medicare does not pay for custodial or long-term nursing home care.

What is Medicaid?

Medicare is only one of many health insurance programs available to older people and others with disabilities. The second-largest federal health insurance program for such people is Medicaid. Medicaid's main function is to provide medical care for people in need who cannot afford the cost of health care. Although Medicaid has traditionally paid hospitals and other providers of health care directly, under managed care, counselors help enrollees choose their providers, review treatment decisions, and otherwise help enrollees get better value for their money.

Like Medicare, Medicaid is a federal program, and eligibility rules vary from one state to another, so keep this in mind if you are moving states. Because medical costs generally rise faster than other living costs, more and more people are becoming eligible for Medicaid because they do not have enough income to pay their living expenses and medical bills. In 1997, 9 percent of the population was covered by both programs, and 38 percent by either Medicare or Medicaid.

What medical care is covered by Medicaid?

The federal government sets general guidelines for the kind of health care that must be provided to beneficiaries, but states have much leeway in designing their programs. In most cases, state Medicaid programs cover a broad range of medical services, but not all Medicaid programs pay for the same services. Usually, states are required to cover certain medical services, including inpatient hospital care, nursing home care, laboratory tests, X-rays, physician visits, prenatal and well-baby care, family planning services (including voluntary sterilization), immunizations for children up to age 18 that are recommended by the U.S. Centers for Disease Control and Prevention (CDC), and some home health services. States usually must cover additional medical care if they choose to provide it; in some cases, this means that the state must pay providers more than the amount paid by Medicare or other insurance plans for covered services.

Differences between Medicare and Medicaid in terms of cost and eligibility?

The general rule is that Medicaid pays less for medical services than either Medicare or private health insurance plans. There are also differences between the two programs in terms of who can qualify for benefits and what kinds of costs they must pay. Also, although Medicaid generally pays less than either Medicare or private health insurance plans, the differences vary from state to state.

It can be difficult to know whether Medicare or Medicaid will provide better coverage for a given situation. To make the right decision, it's important to understand that each program has its eligibility requirements and limitations on what kinds of medical services are covered. One thing is certain: if you want health care coverage as an older person or someone with disabilities, there is no way around these two programs - they're both mandatory to receive benefits from the federal government. Talk about your specific needs with consultants who can explain how each of these programs operates.

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