No — Medicare and Medicaid are two separate government programs with different rules, different funding, and different people they serve.

Medicare is a federal insurance program you pay into through payroll taxes during your working years. You become covered at 65, regardless of income. Medicaid is a joint federal-state program that pays for medical care for people with low income, at any age. The names sound alike, but they work in almost opposite ways: Medicare is based on age and work history; Medicaid is based on income and assets. Mixing them up can cost you money or cause you to miss out on coverage you may have access to for.

Many people assume the two programs are the same thing because of their similar names. They are not. Understanding which one you may have access to for — and whether you might may have access to for both — is one of the most important decisions you will make about your health coverage.

Key Takeaways

  • Medicare covers people 65 and older, some younger people with disabilities, and people with end-stage renal disease, regardless of income.
  • Medicaid covers people of any age whose income and assets fall below their state's limits, and the income thresholds vary significantly by state.
  • Medicare is funded by federal payroll taxes and is the same in every state; Medicaid is jointly funded by federal and state money and has different rules in each state.
  • You can have both programs at the same time — this is called being "dual may be able to access" — and many people over 65 with low income do.
  • Enrollment important date, covered services, and out-of-pocket costs are different for each program and require separate sign-up steps.

Who Each Program Covers

Medicare covers you if you are 65 or older and have worked at least 10 years in a job where you paid Medicare taxes. It also covers some people under 65 who have been on Social Security disability for at least 24 months, and people of any age with end-stage renal disease or ALS. Income does not matter — a millionaire and someone living in poverty both get Medicare at 65 if they have the work history.

Medicaid covers people whose income is below a certain level set by their state. In 2024, that threshold ranges from about $1,500 per month for a single person in some states to over $2,500 in others. Medicaid also looks at your assets — how much money and property you own. The asset limits vary by state but typically range from $2,000 to $3,000 for a single person. Medicaid covers children, pregnant people, parents, people with disabilities, and seniors, but only if their income and assets fall within their state's limits.

The key difference: Medicare asks "Are you old enough or disabled enough?" Medicaid asks "Are you poor enough?" This fundamental split means the two programs serve almost completely different populations, even though both are government-run health insurance.

How Each Program Is Funded and Run

Medicare is a federal program run the same way in all 50 states. It is funded by payroll taxes — 1.45% from your paycheck and 1.45% from your employer, plus an additional 0.9% tax on earnings over $200,000 for individuals. When you turn 65, you are automatically covered if you have the work history. There is no state variation in who qualifies or what the basic benefits are.

Medicaid is jointly funded by the federal government and each state. Because states contribute money and set their own rules, Medicaid looks different depending on where you live. One state might cover people earning up to 138% of the federal poverty level; another might cover only those at 100%. One state might cover dental care; another might not. One state might cover vision; another might limit it. You have to look up your own state's rules to know what you may have access to for and what services are available to you.

What Services Each Program Covers

Medicare has four parts. Part A covers hospital stays, skilled nursing care, and hospice. Part B covers doctor visits, outpatient care, and some preventive services. Part D covers prescription drugs. Part C (Medicare Advantage) is an alternative to Parts A and B offered by private insurance companies. Medicare does not cover dental, vision, or hearing aids in the traditional program, though some Medicare Advantage plans do.

Medicaid covers a broader range of services because it is designed for people with low income who may have more complex needs. All state Medicaid programs must cover hospital care, doctor visits, lab work, X-rays, and nursing home care. Most states also cover dental, vision, hearing aids, mental health services, and substance use treatment. Some states cover more — transportation to medical appointments, home care, or adult day programs. You need to check your state's Medicaid handbook to see what is covered where you live.

Out-of-Pocket Costs: What You Pay

Medicare requires you to pay premiums, deductibles, and copayments. The Part B premium is $164.90 per month in 2024 (higher if your income is above a certain level). Part A has no premium if you have 40 quarters of work history, but it has a deductible of $1,632 per hospital stay in 2024. Part D premiums vary by plan. You also pay 20% coinsurance for most services after you meet your deductible. These costs add up, which is why many people buy supplemental insurance (Medigap) or choose Medicare Advantage.

Medicaid has much lower out-of-pocket costs because it is designed for people with low income. Most state Medicaid programs charge no premium, no deductible, or very small copayments — often $1 to $3 per visit. Some services, like emergency care, are free. States cannot charge copayments for children, pregnant people, or emergency services. If you are on Medicaid, your costs are typically much lower than Medicare, which is one reason many people with low income prefer it when they have a choice.

Can You Have Both Medicare and Medicaid?

Yes. If you are 65 or older and your income is low enough to may have access to for Medicaid in your state, you can be enrolled in both programs at the same time. This is called being dual may be able to access. Medicare is your primary insurance and pays first; Medicaid pays second and often covers the costs Medicare does not — like premiums, deductibles, and copayments. Many people over 65 with low income are dual may be able to access, and having both programs can significantly reduce what you pay out of pocket.

If you are under 65 and on Medicaid, you cannot also be on Medicare unless you have a disability that qualifies you for Medicare (like being on Social Security disability for 24 months). In that case, you would have both, and the same primary-secondary payment structure applies. Being dual may be able to access is actually an advantage because Medicaid fills in the gaps that Medicare leaves.

How to Sign Up for Each Program

For Medicare, you sign up through Social Security. You can explore online at ssa.gov, by phone at 1-800-772-1213, or in person at your local Social Security office. You should sign up three months before you turn 65. If you miss the important date, you may pay a penalty on your premiums for life. If you are already on Social Security disability, you are automatically enrolled in Medicare when you turn 65.

For Medicaid, you explore through your state. Each state has its own process process and website. You can search "[your state] Medicaid" to find the process, or call 211 to be connected to your state's Medicaid office. You can explore online, by mail, or in person. Medicaid has no enrollment important date — you can explore any time you think you may have access to. Once you are approved, coverage usually starts the first day of the month you applied.

Frequently Asked Questions

Do I have to choose between Medicare and Medicaid?

No. If you are 65 or older and your income qualifies you for Medicaid, you can have both. Medicare is your primary coverage and Medicaid fills in gaps. You do not have to choose one or the other.

What if I turn 65 but do not have 10 years of work history for Medicare?

You may still may have access to for Medicare if your spouse worked and paid Medicare taxes for 10 years — you can get coverage as a spouse. If neither you nor a spouse has the work history, you would not may have access to for Medicare at 65, but you might may have access to for Medicaid if your income is low enough in your state.

Does Medicaid cover the same doctors as Medicare?

Not necessarily. Medicare and Medicaid are separate programs, so doctors and hospitals accept one, the other, both, or neither. When you enroll, you should check whether your current doctor accepts the program you are signing up for. If you have both, your doctor must accept at least one of them.

Can I switch from Medicare to Medicaid if my income drops?

You cannot drop Medicare once you are enrolled at 65, but you can add Medicaid if your income falls below your state's limit. You would keep both programs. If you are on Medicare Advantage (Part C), you can switch to Original Medicare during the annual enrollment period, which runs October 15 to December 7 each year.

What happens to my Medicaid if I start earning more money?

If your income rises above your state's Medicaid limit, you will lose Medicaid coverage. The timing depends on your state — some end coverage the month after you report the income change, others give you a grace period. You should report income changes to your state Medicaid office right away so there are no surprises.