What is the difference between Medicare and Medicaid?

Medicare is a federal insurance program that is paid out of Social Security deductions. Anyone 65 or older who has made Social Security contributions is entitled to Medicare benefits. People under the age of 65 who have disabilities and have been eligible for Social Security disability benefits for at least two years are also entitled to Medicare benefits. Medicaid is a combined federal and state program. It is designed to help pay for medical care for people receiving public assistance and individuals who need home care or nursing home care. Medicaid recipients can receive Medicare, but the Medicaid program is not related to the Medicare program. Medicaid is a need-based program that is funded jointly with funds from the state and the federal government.

Who is eligible for Medicaid assistance?

Recipients of Supplemental Security Income (SSI) are automatically eligible for Medicaid. Other individuals whose level of income would make them ineligible for public benefits can qualify for Medicaid assistance if they are “medically needy” and their income and resources fall within limits set by Medicaid. The current resource limit for a single individual is $2,000. People who may be considered medically needy include:

  • Low-income individuals who are 65 or over, blind and/or
  • Low-income individuals with dependent children
  • Children under the age of 21
  • Pregnant women
  • Medically indigent adults in skilled nursing or intermediate care, or those who qualify for Medicaid funded home and community based waiver programs

If you have too many assets to qualify for assistance from Medicaid to pay for long-term care, an experienced elder law attorney may be able to structure your assets to make you eligible for assistance. Don’t assume that you can’t qualify or that you must spend down all of your money first.