Medicaid and Medicare are the two largest publicly funded health programs in the country with different missions that often overlap. Medicare provides health coverage to seniors and some individuals with disabilities. Medicaid covers adults and children who cannot afford insurance, or who have health care costs they cannot afford. Often, an individual will be eligible for coverage through both programs. Today, I will focus on how both programs work together by answering some commonly asked questions.
Medicare and Medicaid both provide basic health coverage for those who qualify. For individuals who are receiving Medicaid and enroll in Medicare, it may replace all or most of their coverage. For individuals who are on Medicare and begin to receive Medicaid, Medicaid will be supplemental insurance. Individuals who have benefits from both are considered “Dually Eligible”.
I currently have Medicaid, what happens when I become eligible for Medicare?
If you are on Medicaid, you might lose those benefits when you enroll in Medicare. To keep Medicaid benefits, you must meet the eligibility criteria for another Medicaid program, and if you eligible for Medicaid under another program, you will keep both Medicare and Medicaid. If you are covered under MAGI Medicaid, you will lose MAGI coverage at age 65 or when enrolled in Medicare.
How does Medicaid work with Medicare?
Medicare will always be the primary insurance for anyone who is Dual Eligible. Any medical insurance claims are first submitted to Medicare for payment. Any costs remaining are then submitted to Medicaid. Medicaid helps those who have Medicare but don’t meet the financial criteria for full Medicaid benefits. For these individuals, Medicaid offers help paying for some of the out-of-pocket costs under Medicare. These programs are called Medicare Savings Programs (MSP). There are four types of MSP:
- Qualified Medicare Beneficiaries (QMB) can have income up to 100% of Federal Poverty Level (FPL) ($1,074/mo in 2021). Medicaid will cover all premiums, deductibles, and copays for Medicare Parts A and B.
- Specified Low-Income Medicare Beneficiary (SLMB) can have income up to 120% of FPL ($1,288/mo). Medicaid pays Part B premiums.
- Qualifying Individuals (QI) can have income up to 135% of FPL ($1,449/mo). Medicaid will pay Part B premiums, but the program is limited and not everyone who applies will be accepted.
Qualified Disabled Working Individuals (QDWI). Individuals.
- Qualified Disabled Working Individuals (QDWI). Individuals with disabilities who work can get Medicare Part A premiums paid if they earn less than 200% of FPL ($2,147/mo.)
Will I still use Medicare if I’m in the nursing home?
Medicare is still the primary insurer of anyone Dually Eligible in a nursing home. Medicare still covers any hospitalizations, short-term rehab, and visits to primary care doctors. Medicare also covers hospice care. Medicaid covers the cost of long-term care in the nursing home and covers the out-of-pocket costs of Medicare. If you have both Medicare and Medicaid, you won’t have any out-of-pocket cost for anything that is medically necessary. You and your spouse can also have Medicare Advantage or MediGap insurance as well, to cover dental, vision, or other things not covered by Medicare or Medicaid. Any health insurance premiums for coverage for you and your spouse is deducted from the amount you must pay to the nursing home each month.
The rules around Medicaid and Medicare can be confusing, and we know you’ll have questions. Managing big change starts with a little conversation, give us a call, we are here for you as you plan for your future.