Medicare and Medicaid are two separate programs with different rules

Medicare is a federal health insurance program for people 65 and older, regardless of income. You pay into it through payroll taxes during your working years. Medicaid is a joint federal and state program that covers people with low income, and the rules change depending on which state you live in. They are not the same program, they do not cover the same people, and you may be able to use both at the same time.

Most people become may be able to access for Medicare automatically when they turn 65. Medicaid may be able to access depends on your income, assets, and state of residence. Some people may have access to for both — this is called "dual may be able to access" — and when that happens, Medicare is your primary insurance and Medicaid fills in gaps.

Understanding which program covers what, and when you need to take action, prevents gaps in coverage and missed important date that can cost you money.

Key Takeaways

  • Medicare starts at age 65 for most people and is based on work history, not income; you must sign up during your Initial Enrollment Period or pay a penalty for late enrollment.
  • Medicaid is based on income and state rules; some states expanded coverage to adults earning up to 138% of the federal poverty level, while others have stricter limits.
  • If you are 65 or older and have low income, you may be may be able to access for both Medicare and Medicaid at the same time, with Medicaid covering costs Medicare does not.
  • You sign up for Medicare through Social Security or Medicare.gov; you sign up for Medicaid through your state's health department or social services office.
  • Missing your Medicare enrollment window can result in permanent premium penalties, so the timing of when you turn 65 matters.

How Medicare works and who pays into it

Medicare is funded by payroll taxes that you and your employer paid during your working years. When you turn 65, you become may be able to access for Part A (hospital insurance) and Part B (doctor and outpatient services) if you or your spouse worked and paid Medicare taxes for at least 10 years. You do not need to be retired to sign up — you can still be working.

Part A is usually free because you already paid for it through taxes. Part B has a monthly premium that comes out of your Social Security check or is billed to you directly. The standard premium in 2024 is higher for people with higher incomes. Part D (prescription drug coverage) and Part C (Medicare Advantage, an alternative to Original Medicare) both have premiums that vary by plan.

If you did not work long enough to may have access to on your own record, you may still may have access to based on your spouse's work history, even if you are divorced (if the marriage lasted at least 10 years).

How Medicaid works and income limits by state

Medicaid is a needs-based program, meaning your income and assets determine whether you may have access to. Each state sets its own income limits, and these limits changed significantly after 2014 when the Affordable Care Act allowed states to expand Medicaid. States that expanded Medicaid generally cover adults earning up to 138% of the federal poverty level (about $1,927 per month for a single person in 2024, though this amount changes yearly). States that did not expand Medicaid have much lower income limits, sometimes as low as 50% of the poverty level.

Your state of residence matters enormously. If you live in a non-expansion state and earn too much for Medicaid but not enough to afford Medicare premiums and out-of-pocket costs, you may fall into a coverage gap. If you move to a different state, your Medicaid status may change when ready.

Medicaid also covers some people under age 65 — children, pregnant people, parents of dependent children, and people with disabilities — but the income and asset rules vary by state. A few states have special programs for older adults with slightly higher income limits.

When you can sign up and what happens if you miss the important date

For Medicare, your Initial Enrollment Period is the three months before the month you turn 65, the month you turn 65, and the three months after. That is a seven-month window. If you sign up during this window, coverage begins the month you turn 65 (or the month after, depending on when in the month you sign up). If you miss this window, you can still sign up during the General Enrollment Period from January 1 to March 31 each year, but your coverage will not start until July 1, and you will pay a permanent 10% penalty on your Part B premium for each year you delayed.

There is one exception: if you are still working and covered by your employer's health plan, you may be able to delay Medicare without penalty. You must sign up within eight months of leaving that job or losing that coverage, or the penalty applies.

For Medicaid, there is no enrollment period — you can sign up any time you meet the income and other requirements. However, some states have waiting lists for certain services like home care, and coverage can take weeks to process after you submit your paperwork.

How to sign up for Medicare

You sign up for Medicare through Social Security. You can do this online at ssa.gov, by phone at 1-800-772-1213, or in person at your local Social Security office. You will need your Social Security number, proof of citizenship or legal residency, and proof of age (birth certificate or passport).

If you are already receiving Social Security benefits, you will be enrolled in Medicare Part A and Part B automatically three months before your 65th birthday. You do not need to do anything unless you want to decline Part B (which is rare and usually not recommended) or choose a different plan.

If you are not yet receiving Social Security, you must contact Social Security to sign up for Medicare. This is separate from signing up for Social Security retirement benefits, though you will likely do both around the same time.

How to sign up for Medicaid

You sign up for Medicaid through your state, not through the federal government. The agency that handles Medicaid varies by state — it may be called the Department of Social Services, Department of Human Services, Department of Health and Human Services, or something similar. You can find your state's Medicaid office by searching "[your state] Medicaid" or by calling 211, which is a free helpline that connects you to local health and human services.

You will need to provide proof of income (recent pay stubs, tax returns, or a letter from your employer), proof of citizenship or legal residency, and proof of your state residency. Some states allow you to sign up online, by mail, or in person. Processing times vary — some states respond within days, others take several weeks.

If you are 65 or older and think you might may have access to for Medicaid based on low income, explore even if you are already on Medicare. Medicaid can pay your Medicare premiums and cover costs that Medicare does not, such as long-term care in a nursing home.

When you may have access to for both Medicare and Medicaid

If you are 65 or older, have low income, and meet your state's Medicaid rules, you may be may be able to access for both programs. When this happens, Medicare is your primary insurance — it pays first — and Medicaid is secondary, covering gaps like deductibles, copayments, and services Medicare does not cover.

Some states have special programs for people who are dual may be able to access. These programs may offer additional services like dental, vision, or hearing coverage that neither Medicare nor standard Medicaid covers. Ask your state Medicaid office whether you may have access to for a dual-may be able to access program.

If you are dual may be able to access and your income or assets change, you must report the change to Medicaid. Losing Medicaid while you still have Medicare means you will owe more out of pocket, so stay in touch with your state office about your status.

Frequently Asked Questions

Do I have to sign up for Medicare at 65 if I am still working?

If your employer has 20 or more employees and you are covered by their health plan, you can delay Medicare without penalty. Once you leave that job or lose that coverage, you have eight months to sign up. If you wait longer, you will pay a permanent penalty on Part B.

Can I have Medicare and Medicaid at the same time?

Yes. If you are 65 or older and meet your state's income and asset limits, you can be enrolled in both. Medicaid will help pay your Medicare premiums and cover costs Medicare does not, like nursing home care.

What if I move to a different state?

Medicare coverage follows you — it works the same in every state. Medicaid does not. You must contact your new state's Medicaid office to learn about you still may have access to under their rules. Your coverage may change when ready when you move.

How much does Medicare cost?

Part A is usually free. Part B has a monthly premium (the standard amount in 2024 is $164.90, but it is higher for people with higher incomes). Part D and Part C premiums vary by plan and location. If you may have access to for Medicaid, it can help pay these premiums.

What if I missed my Medicare enrollment important date?

You can still sign up during the General Enrollment Period (January 1 to March 31), but coverage will not start until July 1 and you will pay a permanent 10% penalty on your Part B premium for each year you delayed. Contact Social Security right away to sign up.