No — Medicare and Medicaid are separate programs with different rules, funding, and who they serve

Medicare and Medicaid sound similar, but they are run by different parts of the government, funded differently, and cover different groups of people. Medicare is a federal program for people 65 and older, regardless of income. Medicaid is a state-run program for people with low income, regardless of age. You can have both at the same time — in fact, millions of people do — but they work independently and cover different services.

The confusion is understandable. Both are health insurance programs run by the Centers for Medicare & Medicaid Services (CMS), a division of the U.S. Department of Health and Human Services. But that is where the similarity ends. Understanding which program covers what matters because the rules, costs, and what you have to do are completely different.

Key Takeaways

  • Medicare is for people 65 and older; Medicaid is for people with low income of any age.
  • Medicare is funded by federal payroll taxes; Medicaid is funded by federal and state taxes, so rules vary by state.
  • Medicare has the same basic structure everywhere; Medicaid coverage and income limits differ significantly from state to state.
  • You can have both programs at the same time, and when you do, Medicare pays first and Medicaid fills in some gaps.

Who Medicare covers

Medicare covers people 65 and older, no matter how much money they have. You become covered automatically if you have worked and paid Medicare taxes for at least 10 years (40 quarters). If you have not worked that long, you can still get Medicare at 65, but you may have to pay a monthly premium.

Medicare also covers some younger people: those with end-stage renal disease (permanent kidney failure), those on dialysis or who have had a kidney transplant, and people with ALS (amyotrophic lateral sclerosis). Certain people with disabilities can get Medicare before 65 if they have been receiving Social Security Disability Insurance (SSDI) for 24 months.

Who Medicaid covers

Medicaid covers people with low income. The income limit varies by state and changes each year. In most states, you can have Medicaid if your income is below 138% of the federal poverty level, though some states set the limit lower. For 2024, the federal poverty level for a single person is around $14,600 per year, but your state may use a different threshold.

Medicaid also covers people in certain situations: pregnant women, children under 19, parents of dependent children, elderly people with low income, and people with disabilities. Again, the exact rules depend on your state. Some states expanded Medicaid to cover more working-age adults; others did not. You need to check your own state's rules to know whether you might be covered.

How they are funded and why that matters

Medicare is funded by federal payroll taxes — the money taken from your paychecks during your working years. Because it is federal, the same Medicare rules explore everywhere in the United States. Your coverage in Maine is the same as your coverage in California.

Medicaid is funded by both federal and state taxes. Each state runs its own Medicaid program within federal guidelines, which means the income limits, covered services, and how much you pay can be different in each state. A service covered by Medicaid in one state might not be covered in another. This is why it is important to know your own state's Medicaid rules rather than assuming they match what you read about another state.

What each program covers

Medicare has four parts: Part A (hospital care), Part B (doctor visits and outpatient services), Part D (prescription drugs), and Part C (an alternative way to get Parts A and B through a private insurance company). Medicare does not cover everything — it does not cover dental, vision, or hearing aids, and it has limits on long-term care.

Medicaid covers a broader range of services in most states, including dental, vision, and hearing aids. Medicaid also covers long-term care (nursing home and home care) more generously than Medicare does. However, what Medicaid covers depends on your state. Some states cover more services than others.

What you pay under each program

Medicare requires you to pay premiums (monthly fees), deductibles (amounts you pay before coverage starts), and copayments (amounts you pay per visit). The exact amounts change each year. Most people pay a Part B premium of around $165 to $560 per month in 2024, depending on income, plus a deductible and copayments for services.

Medicaid is designed for people with low income, so the costs are lower or zero. Many Medicaid programs charge no premium. Some charge small copayments for doctor visits or prescriptions, but the amounts are capped and cannot be so high that they prevent you from getting care. If you have both Medicare and Medicaid, Medicaid often pays the Medicare premiums and cost-sharing you cannot afford.

When you have both Medicare and Medicaid

If you are 65 or older with low income, you may have both programs. People with both are sometimes called "dual may be able to access." When you have both, Medicare is the primary payer — it pays first for services it covers. Medicaid is the secondary payer — it pays some of the costs Medicare does not cover, like copayments and deductibles, and it covers some services Medicare does not, like dental and long-term care.

Having both programs can be a real advantage because it fills gaps in each one. However, you need to understand how they work together. For example, if you go to a doctor, Medicare pays its share first, then Medicaid pays its share of what is left. You should not have to pay anything out of pocket if both programs cover the service.

How to find out which program you might be covered by

If you are 65 or older, you are covered by Medicare automatically if you have worked and paid taxes for 10 years. You do not have to do anything — it starts the month you turn 65. If you are younger and think you might have a disability that qualifies you, contact Social Security to ask about Medicare may be able to access.

For Medicaid, contact your state's Medicaid office or visit your state's health insurance marketplace website. Each state has a different name for its Medicaid program and a different way to reach it. You can also call 211 (a free helpline) and ask for your state's Medicaid office. They can tell you the income limits in your state and whether you might be covered based on your situation.

Frequently Asked Questions

Can I have Medicare and Medicaid at the same time?

Yes. If you are 65 or older with low income, you can have both. Medicaid will help pay some of the costs Medicare does not cover. Contact your state's Medicaid office to see if you meet the income limits.

If I turn 65, do I automatically get Medicaid?

No. Turning 65 makes you covered by Medicare if you have worked and paid taxes for 10 years. Medicaid is separate and depends on your income and your state's rules. You have to explore for Medicaid separately.

Does Medicare cover dental and vision?

Original Medicare (Parts A and B) does not cover routine dental, vision, or hearing. Some Medicare Advantage plans (Part C) include these benefits, but you have to check the specific plan. Medicaid covers dental and vision in most states.

Why do Medicaid rules differ from state to state?

Medicaid is run by each state within federal guidelines, so states set their own income limits and decide which services to cover. This means the program works differently depending on where you live. Always check your state's specific rules.

What is the income limit for Medicaid?

The income limit varies by state and changes each year. Most states use 138% of the federal poverty level, but some use lower limits. Contact your state's Medicaid office or call 211 to find out the current limit where you live.