The Core Difference: Who Pays and Who Qualifies

Medicare is a federal insurance program you pay into during your working years through payroll taxes. You become covered at 65 regardless of income. Medicaid is a joint federal and state program that covers people with low income, regardless of age. The two programs operate separately, use different rules, and cover different things — but some people may have access to for both.

Think of Medicare as something you've earned through work history. Think of Medicaid as a safety net based on current financial need. A person can have Medicare alone, Medicaid alone, or both at the same time (called "dual may be able to access").

Key Takeaways

  • Medicare covers people 65 and older, or younger people with certain disabilities or end-stage renal disease, and is based on work history, not income.
  • Medicaid covers people with low income and limited assets, at any age, and rules vary significantly by state.
  • Medicare has four parts (A, B, C, D) with different coverage areas; Medicaid coverage varies by state but typically includes doctor visits, hospital care, and prescriptions.
  • Some people may have access to for both programs and can use them together, with Medicare paying first and Medicaid filling gaps.
  • You must take action to enroll in Medicare at 65; Medicaid enrollment happens through your state's health department or social services office.

How You may have access to: Age, Work History, and Income

You may have access to for Medicare at 65 if you or your spouse worked and paid Medicare taxes for at least 10 years (40 quarters). You don't need to be retired — you can still be working. You also may have access to before 65 if you've received Social Security disability benefits for 24 months, or if you have end-stage renal disease or ALS.

Medicaid has no age requirement. You may have access to based on income and assets. The income limit varies by state — some states cover people earning up to 138% of the federal poverty level, others use different thresholds. Asset limits also vary: some states count savings and property, others don't. You must check your specific state's rules because Medicaid in one state is not the same as Medicaid in another.

If you're 65 or older and have low income and limited assets, you may may have access to for both. Your state's Medicaid office can tell you whether you meet their income and asset limits.

What Each Program Covers

Medicare Part A covers hospital stays, skilled nursing facility care, hospice, and some home health services. Part B covers doctor visits, outpatient care, and medical equipment. Part D covers prescription drugs. Part C (Medicare Advantage) is an alternative to Parts A and B offered by private insurers — it bundles hospital and doctor coverage and usually includes prescription drug coverage.

Medicare does not cover long-term custodial care (help with bathing, dressing, meals at home), dental, vision, or hearing aids. You pay a monthly premium for Part B and Part D, and you share costs through deductibles and copayments.

Medicaid covers doctor visits, hospital care, emergency services, prescription drugs, and mental health services. Most states also cover nursing home care and home health services — this is a major difference from Medicare. Medicaid coverage details vary by state, so what's covered in one state may not be in another. You typically pay little or nothing out of pocket.

Cost and Premiums

Medicare Part A is free if you or your spouse paid Medicare taxes for 10 years. Part B has a monthly premium (the standard amount in 2024 is $164.90, but it varies based on income). Part D premiums vary by plan. If you choose Part C (Medicare Advantage), you pay the Part B premium plus a plan premium, which can be $0 to $200+ per month depending on the plan.

You also pay deductibles and copayments when you use services. For example, Part A has a deductible of $1,632 per hospital stay (2024), and Part B has a $240 annual deductible (2024). These amounts change each year.

Medicaid is free or very low cost. You may pay small copayments for some services, but many states charge nothing. If you have both Medicare and Medicaid, Medicaid can help pay your Medicare premiums and cost-sharing.

Enrollment: When and How to Sign Up

You must enroll in Medicare during your Initial Enrollment Period, which is the three months before the month you turn 65, the month you turn 65, and the three months after. If you miss this window, you pay a permanent penalty on your Part B and Part D premiums. The exception: if you're still working and covered by your employer's health plan, you can delay enrollment without penalty.

You enroll through Social Security — online at ssa.gov, by phone at 1-800-772-1213, or in person at your local Social Security office. You'll need your birth certificate, proof of citizenship or legal residency, and bank account information if you want direct deposit.

Medicaid enrollment happens through your state. Contact your state's Medicaid office, health department, or social services agency. Some states use online portals, others require in-person or phone applications. You'll need proof of income (recent pay stubs or tax returns), proof of residency, and information about your assets and household size.

What Happens If You Have Both Medicare and Medicaid

If you may have access to for both, you're called "dual may be able to access." Medicare pays first for services it covers. Medicaid then pays your Medicare premiums, deductibles, and copayments, and covers services Medicare doesn't — like long-term nursing home care and dental work.

This is often the best financial position to be in if you have low income and high medical needs. However, you must be enrolled in both programs for this to work. Some states offer special Medicaid programs for dual-may be able to access people that coordinate care and may offer additional services.

State Differences in Medicaid

Medicaid rules differ significantly by state. Some states expanded Medicaid to cover people earning up to 138% of the federal poverty level; others did not. Some states cover dental and vision; others don't. Some states have long waiting lists for nursing home coverage; others don't.

Before you assume what Medicaid will or won't cover, contact your state's Medicaid office directly. You can find your state agency through medicaid.gov or by calling 1-800-MEDICARE and asking for a referral to your state Medicaid office.

Frequently Asked Questions

Can I have Medicare and Medicaid at the same time?

Yes. If you're 65 or older and may have access to for both based on income and assets, you can be enrolled in both. Medicare covers hospital and doctor services; Medicaid covers your Medicare costs and services Medicare doesn't, like long-term nursing home care. Contact your state Medicaid office to see if you meet their income and asset limits.

What if I'm under 65 and don't have Medicare yet?

You may may have access to for Medicaid based on income and assets. Medicaid has no age requirement. You can also purchase coverage through the health insurance marketplace at healthcare.gov. If you're disabled and have been receiving Social Security disability benefits for 24 months, you become may be able to access for Medicare even before 65.

Do I have to enroll in Medicare Part D for prescriptions?

You should enroll in Part D when you first become may be able to access at 65, even if you don't take many medications. If you delay enrollment without a valid reason (like coverage through an employer or Medicaid), you pay a permanent penalty. If you have Medicaid, it may cover your prescriptions, so check with your state before enrolling in Part D.

What if I can't afford my Medicare premiums and deductibles?

If you have low income, you may may have access to for Medicare Savings Programs, which are state-run programs that help pay your premiums and cost-sharing. You may also may have access to for Extra Help, a federal program that helps pay Part D premiums and copayments. Contact your state Medicaid office or call 1-800-MEDICARE to learn about these programs.

Does Medicare cover nursing home care?

Medicare covers skilled nursing facility care for up to 100 days after a hospital stay of at least three days, but only if you need skilled care (like wound care or physical therapy). It does not cover long-term custodial care — help with daily activities like bathing and dressing. Medicaid covers long-term nursing home care in most states, but only if you have low income and limited assets.