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CHOICES Corner
What is the difference between Medicare and Medicaid? People frequently confuse the two programs and consequently are unaware of potential benefits or are unpleasantly surprised that they do not have coverage for other health-related costs.
Medicare is federal health insurance for people sixty-five or older and some people under sixty-five with certain disabilities or conditions. It is a federal program that provides coverage for some medical conditions, hospitalizations, and rehabilitation services. The Centers for Medicare & Medicaid Services runs Medicare. Because it is a federal program, Medicare has set standards for costs and coverage. This means a person’s Medicare coverage will be the same no matter what state they live in.
Medicare-related bills are paid from two trust funds held by the U.S. Treasury. Different sources (including payroll taxes and funds that Congress authorizes) fund trust funds. People with Medicare pay part of the costs through things like monthly premiums, deductibles, and coinsurance.
Medicaid is a joint federal and state program that helps cover medical costs for some people with limited income and resources. The federal government has general rules that all state Medicaid programs must follow, but each state runs its own program. This means eligibility requirements and benefits vary from state to state.
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