Whether you're born in America or new to the country, looking for health insurance can be a challenge, especially when terms like Medicare and Medicaid can be so confusing. If you're wondering what the difference is between Medicare and Medicaid, we'll break it down for you point by point.
If you already have Medicare and need travel insurance with medical coverage for a trip abroad, you can read more about which travel insurance plans can help you on your travels.
Medicare or Medicaid: Which Do You Need?
Medicare
Medicaid
Medicare is a U.S. Federal health insurance program administered by the United Federal government, providing health insurance coverage to people who are aged 65 and over, or who meet other special criteria. Medicare has Part A (Hospital Insurance), Part B (Medical Services), Part C (Managed Health Care) and part D (Prescription Drugs).
Medicaid is a health program for eligible individuals and families with low incomes and resources. It's a means-tested program that is jointly funded by the states and federal government, and is managed by the states. Each state may have its own name for the program. Examples include "Medi-Cal" in California, "MassHealth" in Massachusetts, and "TennCare" in Tennessee.
Eligibility
Either U.S. citizens & permanent residents 65 or older, who have worked (or their spouse has worked) and paid Medicare taxes in the U.S. for at least 10 years. Permanent Residents above age 65, who have lived in the U.S. can purchase Medicare from the government. Medicare for green card holders is an option as long as you meet the permanent residency requirements.
Residents with disabilities under 65 years of age and who have been receiving either Social Security benefits or the Railroad Retirement Board disability benefits for at least 24 months from the date of entitlement. People with end-stage renal disease or who need a kidney transplant.
Eligible for Social Security Disability Insurance and have amyotrophic lateral sclerosis (ALS-Lou Gehrig's disease).
- Limited income is one of the primary requirements for Medicaid eligibility.
- Other requirements include, but are not limited to, age, pregnancy, disability, blindness, income and resources, and one's status as a U.S. citizen or a lawfully admitted immigrant.
- Special rules exist for those living in a nursing home and disabled children living at home. A child may be covered under Medicaid if she or he is a U.S. citizen or a legal resident of the U.S
- A child may be eligible for Medicaid regardless of the eligibility status of his or her parents or guardians.
- Patients with AIDS with T cell count of 200 or under
- Must be a resident of the plan-offering state.
Benefits & Services
- Part A Hospital Insurance helps cover inpatient care in hospitals, including overnight hospitalization in hospitals, and skilled nursing facilities. It also helps cover hospice care and some home health care. Beneficiaries must meet certain conditions to get these benefits
- Medicare Part B (Medical Insurance) helps cover doctors' services and outpatient care. It also covers some other medical services that Part A doesn't cover, such as some of the services of physical and occupational therapists, and some home health care. Part B helps pay for these covered services and supplies when they are medically necessary.
- Medicare Part C is managed care
- Medicare Part D is prescription drug coverage to help lower the price of prescription drugs
- Inpatient hospital services
- Outpatient hospital services
- Prenatal care
- Vaccines for children
- Physician services
- Nursing facility services for persons aged 21 or older.
- Family planning services and supplies
- Rural health clinic services
- Home health care for persons eligible for skilled-nursing services
- Laboratory and x-ray services
- Pediatric and family nurse practitioner services
- Nurse/midwife services
Coverage Start Date
If you already receive Social Security Benefits, you'll automatically be enrolled into Medicare on the month you turn 65 years old. If you're close to 65 years of age and don't receive social security benefits yet, there are two periods of the year that you can enroll:
- Initial Enrollment Period (IEP) for Parts A and B is 7 months, starting 3 months before the month of you turn 65 years old and ending 3 months after the month of eligibility.
- General Enrollment Period extends from January 1 through March 31 each year. Enrollment becomes effective on July 1 of the same year.
No specific dates. Coverage may start retroactive to any or all of the three months prior to application, if the individual would have been eligible during the retroactive period. Coverage generally stops at the end of the month in which a person's circumstances change.
For Immigrants
If you're a new immigrant aged 65 and above, have been a permanent resident for 5 years or more, and are looking for new immigrant insurance, you may purchase Medicare from the government.
To obtain medical insurance for new immigrants to the U.S., the only available immediate health insurance solution is to get a short term health insurance. Learn more information about insurance for green card holders
For more information on Medicaid services, please visit http://cms.hhs.gov/home/medicaid.asp
Will Medicare or Medicaid Cover You Abroad?
Unfortunately, both Medicare and Medicaid are forms of domestic healthcare, so they won't cover you once we step beyond U.S. borders. However, travel insurance for seniors can help protect you financially whether you're faced with an unexpected medical expenses or you need to cancel your trip.
If you are interested in learning more about your options as a senior, our award-winning team of licensed insurance expertscan assess your situation and help you with a solution.
Disclaimer:Information presented here is high-level and for general information purposes only. Information may not be accurate and is subject to change. You should contact the concerned federal (Medicare.gov) or state health department to discuss your specific situation and options. Please review our complete "Terms of Use".
Frequently Asked Questions About Medicare vs Medicaid and Travel Insurance
I have a Medicare Advantage plan. Do I still need travel insurance?
Yes. If you are a senior with a Medicare Advantage plan, it is strongly recommended that you still get a travel medical insurance policy for any trips outside of the United States to ensure that you have no gaps in coverage abroad. Medicare Advantage plans generally do not offer coverage for medical expenses internationally. While a few plans may offer limited coverage for medical emergencies outside the U.S., these benefits are typically very restricted, often featuring low maximum coverage amounts and significant limitations.
I’m on Medicaid. Will it cover me if I travel to another state to visit family?
Most of the time, no. Because Medicaid is different from state to state, a provider in one state is typically authorized to bill only that state’s Medicaid program. The only exception is if you have a life-threatening emergency, need immediate medical care, and there isn’t time to return home for treatment. To prepare for a trip out of your home state, it may be possible to get preapproved Medicaid coverage at an out-of-state facility with proper authorization.
My Medigap plan says I have a $50,000 lifetime maximum benefit for foreign travel emergency coverage. Why isn’t that enough?
The $50,000 lifetime maximum benefit is not enough to cover you abroad, especially if you have a major medical emergency that uses up your entire benefit. If you get a serious injury where you need to be medically evacuated, that alone can cost a good majority of your Medigap benefit. Since it is a lifetime benefit, once all $50,000 is used, it is gone. Because of the limit, it is highly recommended to buy a travel medical insurance plan that serves as primary coverage.
If I have Medicare Part D, can I use my coverage for prescription refills abroad?
No. Medicare Part D plans do not cover prescription drugs purchased outside the United States, the District of Columbia, and U.S. territories. You would have to pay 100% out-of-pocket at foreign pharmacies, since Medicare is restricted to the U.S.
Can I get travel insurance if I already have a chronic health condition?
Yes. While most standard travel insurance plans exclude pre-existing conditions, there are three main options for pre-existing coverage:
- Plans with a pre-existing condition waiver: Only for American citizens traveling internationally and if purchased shortly after making their first trip deposit
- Plans that cover the acute onset of pre-existing conditions: Cover sudden emergencies only
- Plans specifically designed for travelers with pre-existing conditions: Great option for seniors visiting the U.S.
Can Medicare cover me while on a cruise ship?
Medicare may cover you if there is a doctor on board who's allowed to provide medical services under specific laws. You can also use Medicare for medical coverage if the ship is within 6 hours of a U.S. port. If the ship happens to be any further away than 6 hours, then Medicare health cover will not cover you. In this instance, travel insurance can help.
With travel insurance, do I have to pay the hospital myself and get reimbursed later?
It depends on the plan and the care you receive. For emergency hospitalizations, direct billing may be available, especially with travel medical insurance plans, but it is best to contact the 24/7 assistance services to explain your situation, and they may direct you to a hospital that can provide direct billing. With non-emergency care, you typically pay upfront at a clinic or urgent care and then file a claim for reimbursement.
