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eLearning Series:
Your Most Popular Insurance Questions
Answers For Health and Home
Insurance
( 50 articles
in this series )
What's The
Difference Between
Medicaid and Medicare?
Medicare and the Medicaid both fall under
the umbrella of the Social Security Act. They were established
in 1965 and sought to expand the budding safety-net for the
elderly and the indigent.
Medicare’s
first and foremost goal was the creation of a system that
would guarantee that the elderly population’s medical
care needs would be met. While Medicare originally limited
its benefits to individuals aged 65 and older, in 1972 Medicare
coverage was expanded to also include those individuals who
are severely disabled and because of their disability entitled
to at least 24 months of disability benefits, and also to include
patients who suffer from the advanced stages of kidney disease
that require dialysis or a kidney transplant. In 1973, the
Medicare program was further extended to also include individuals
who did not fall into any of the three categories previously
mentioned, yet who wished to buy into it.
Medicare
is a two-tier program that consists of a Part A and a Part
B. Part A is the portion that deals with hospital insurance,
while Part B is referred to as supplementary medical insurance.
Part A goes into effect automatically when a person reaches
age 65 or enters the 25th month of disability benefits, while
Part B requires an application process. Hospital insurance
allows for an unlimited lifetime benefit of inpatient hospital
stays and up to 100 days of subsequent skilled nursing care
per benefit period. Part A is not entirely free, and a co-payment
is required. Hospital care benefits are extensive, and they
include semi-private rooms, drugs, laboratory tests, and any
medically necessary services, procedures, and supplies. Skilled
nursing care consists of the services covered by hospital care,
but it also allows for rehabilitation therapy and appliances,
such as oxygen tanks, C-Pap machines, apnea monitors, etc.
In conjunction with skilled nursing care, home health care
may be used without limitation. In 1983, Medicare Part A was
amended to also include hospice care for terminally ill patients
whose life expectancy was six months or less, and who have
chosen to no longer receive conventional treatments for their
illness.
Medicare
Part B is an optional coverage that must be purchased
and paid for with monthly payments on a regular basis. While
it appears that Part B and Part A overlap, the supplementary
medical insurance actually goes further than Part A in that
it covers services such as flu vaccinations, ambulance services,
blood for transfusions, and other services and products not
covered under Part A.
It is important to note that Medicare
does not cover custodial care for individuals in need of
round the clock treatment or
long-term nursing home stays. Additionally, dentures, dental
care, glasses, hearing aids and prescription drugs are not
covered.
Medicaid,
on the other hand, sought to improve upon the medical care
provisions that were available to those individuals who
were eligible for public assistance. It is not an all-inclusive
program, and a low income alone does not guarantee eligibility
for the program benefits. In general, families who receive
Aid to Families with Dependent Children (AFDC), pregnant women
whose income falls below the poverty level, recipients of Supplemental
Security Income (SSI) and adoption assistance are eligible
to receive Medicaid benefits.
Medicaid
has two loosely defined components that may or may
not be available in each state. If a state has a “medically
needy” component to its Medicaid program, it will allow individuals
who may have more income than the poverty level, yet who are
burdened by extreme health care expenses, to receive benefits.
All states offer a “categorically needy” definition, and usually
the benefits are more extensive than for individuals who take
advantage of the “medically needy” program (if available).
Medicaid benefits will stop if individual eligibility criteria
no longer apply. For example, if recipients of AFDC or SSI
lose their eligibility to those programs, and if Medicaid coverage
was received solely because of participation in those programs,
then in addition to losing AFDC or SSI the individual will
also lose Medicaid coverage.
While this could have catastrophic implications for a family,
it is noteworthy that most states provide state-only programs
that mimic Medicaid yet apply to those individuals who lose
Medicaid eligibility, thus easing the transition.
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by SolveYourProblem.com : 2005
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