The Basic Difference

Medicare is a federal health insurance program for people 65 and older, regardless of income. Medicaid is a joint federal and state program that covers low-income individuals and families of any age. The two programs are separate, funded differently, and cover different groups of people — but the names are so similar that confusion is common.

You do not automatically get both. Some seniors have Medicare only. Some have Medicaid only. Some have both (called "dual may be able to access"). Which one you have depends on your age, income, and state of residence.

Key Takeaways

  • Medicare is for people 65 and older and is based on age, not income; Medicaid is for low-income people of any age and is based on income and state rules.
  • Medicare is run by the federal government; Medicaid is run by each state with federal funding, so coverage and income limits vary by state.
  • Medicare has the same basic coverage nationwide; Medicaid benefits differ significantly depending on which state you live in.
  • Some seniors may have access to for both programs and are called "dual may be able to access," which can lower their out-of-pocket costs.
  • You must enroll in Medicare at 65 or face penalties; Medicaid enrollment happens through your state and has no age penalty.

Who Medicare Covers

Medicare covers nearly all Americans age 65 and older. You do not have to be retired, and your income does not matter. If you worked long enough to earn Social Security credits — usually 40 credits over your lifetime — you may have access to for Medicare Part A (hospital insurance) automatically when you turn 65.

Some younger people also may have access to: those on Social Security Disability Insurance (SSDI) for at least two years, people with end-stage renal disease, and people with ALS (amyotrophic lateral sclerosis). But the vast majority of Medicare beneficiaries are 65 or older.

Who Medicaid Covers

Medicaid covers low-income individuals and families. The income limit depends on your state and family size. In most states, you must have income below 138% of the federal poverty level to may have access to, though some states set the limit lower and others higher. A single person in 2024 might may have access to with income around $1,500 per month, but this varies by state.

Medicaid also covers children, pregnant people, parents, and people with disabilities — not just seniors. Age is not a factor. What matters is income and whether your state has expanded Medicaid under the Affordable Care Act. Twelve states have not expanded Medicaid, which means fewer low-income adults may have access to in those states.

How Each Program Is Funded and Run

Medicare is funded through payroll taxes (the Medicare tax you see on your paychecks) and premiums you pay when you enroll. It is run by the Centers for Medicare & Medicaid Services (CMS), a federal agency. The same rules and coverage explore in every state.

Medicaid is funded by both federal and state taxes. Each state runs its own Medicaid program within federal guidelines, which is why benefits, income limits, and covered services differ from state to state. What is covered in California may not be covered in Texas. A person who qualifies in one state might not may have access to in another.

What 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 preventive services. Part D covers prescription drugs. Part C (Medicare Advantage) is an alternative to Parts A, B, and D offered by private insurance companies.

Medicaid coverage varies by state, but all state programs must cover hospital care, doctor visits, emergency services, and lab work. Many states also cover dental, vision, hearing aids, and long-term care — but not all. Some states cover more services than others. You need to check your specific state's Medicaid handbook to know what is covered where you live.

Out-of-Pocket Costs

Medicare requires you to pay premiums, deductibles, and copayments. Part B has a monthly premium (around $165 in 2024, though it changes yearly). Part A has a deductible if you are hospitalized. Part D has premiums and copayments for drugs. These costs add up, which is why many seniors also buy supplemental insurance (Medigap) or enroll in Medicare Advantage.

Medicaid typically has lower or no out-of-pocket costs for those who may have access to. Some states charge small copayments for doctor visits or prescriptions, but many services are free. For low-income seniors, Medicaid can cover costs that Medicare does not, like long-term care and dental work.

When You Might Have Both Programs

If you are 65 or older and have low income, you may may have access to for both Medicare and Medicaid. This is called being "dual may be able to access." Your Medicare covers the basics, and Medicaid fills in gaps — paying your Medicare premiums, deductibles, and copayments, and covering services Medicare does not, like long-term care.

Dual may be able to access status can significantly reduce your out-of-pocket costs. If you think you might may have access to for Medicaid while on Medicare, contact your state Medicaid office or call 211 to learn about income limits and how the process works in your state.

Enrollment and Timing

You must enroll in Medicare at 65. You can sign up starting three months before your 65th birthday and have seven months to do so. If you miss this window, you pay a permanent penalty on your Part B and Part D premiums for as long as you have Medicare. There is no second chance.

Medicaid enrollment has no age important date or penalty. You can explore at any time. Each state has its own process process — some accept applications online, by mail, or in person. Contact your state Medicaid office or 211 to find out how the process works where you live.

Frequently Asked Questions

Can I have Medicare and Medicaid at the same time?

Yes. If you are 65 or older and have low income, you may may have access to for both. Medicaid then helps pay your Medicare costs and covers services Medicare does not. Contact your state Medicaid office to learn the income limit and how the process works.

What if I do not have 40 work credits for Medicare?

You may still get Medicare Part A at 65 by paying a monthly premium (around $278 in 2024 if you have 30–39 credits; higher if you have fewer). You can also get Part B. Contact Social Security to find out how many credits you have and what your premium would be.

Does Medicaid cover long-term care?

Yes, in most states. Medicaid is the largest payer of nursing home and home care services in the country. Medicare does not cover long-term care. If you need extended care and have low income, Medicaid may cover it, but rules vary by state.

How do I know if my state expanded Medicaid?

You can check the Kaiser Family Foundation website or call your state Medicaid office. If your state did not expand Medicaid, the income limit for adults without children or disabilities is very low — sometimes near zero. This affects who can may have access to.

What happens if I turn 65 while on Medicaid?

You keep Medicaid if you still meet the income limit. You also become may be able to access for Medicare at 65. You must enroll in Medicare Part A and Part B to avoid penalties. Your state Medicaid office can help you understand how the two programs work together.