Medicare Vs Medicaid // Whats The Difference
Medicare and Medicaid are two terms that get thrown around frequently when discussing health care coverage. Many people seem to use them almost interchangeably although the two are completely separate and distinct programs. Medicare is an insurance program, while Medicaid is intended more as an assistance program. So, just what are the differences between the two? Some of the main differences include eligibility requirements and coverage basics. Keep reading to learn more about what each program is, what each one covers, how to qualify for either, and the key differences between the two. Well also discuss what happens if you qualify for both programs. Lets get started.
Medicare Part B Premiums
Beneficiaries enrolled in Medicare Part B must pay premiums .35 By law, individuals receiving Social Security benefits have their Medicare Part B premiums automatically deducted from their benefit checks.36 In 2017, approximately 75% of Medicare Part B enrollees had their Medicare Part B premiums deducted from their monthly Social Security benefit checks.37 Those not receiving Social Security are billed by Medicare,usually on a quarterly basis.38Individuals who are enrolled in Medicare Part B but do not receive Social Security may include individuals who are waiting to reach full retirement age and individuals who spent their careers in employment that was not covered by Social Security, including certain federal, state, and local government workers.
The standard monthly Medicare Part B premium in 2018 is $134.00. This premium applies to individuals with a modified adjusted gross income of $85,000 or less and to couples with a MAGI of $170,000 or less.42 Enrollees earning more than those respective amounts pay higher premiums based on their income, as shown in Table 1.
Table 1. Medicare Part B Premiums, 2018
Modified Adjusted Gross Income a
Notes: Each member of a couple pays the applicable premium. Lower thresholds are rounded up to the nearest dollar and upper thresholds are rounded down to the nearest dollar.
Contact Your Local State Health Insurance Assistance Program
Based on the information you provided, you do not appear to be eligible for Medicare cost-saving programs.
Each state offers a State Health Insurance Assistance Program , partly funded by the federal government, to give you free counseling and assistance. A SHIP counselor may be available by phone or in person.
Visit www.shiptacenter.org to find your local SHIP office.
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Medicare Eligibility For End
If you have Lou Gehrigs disease orESRD, you dont have to wait through the 24-month period before youre eligiblefor Medicare. If you have ALS, your Medicare coverage starts when you begin collectingdisability benefits.
If youre beingtreated for ESRD, youll become eligible for Medicare 3 months after dialysisbegins, or after you receive a kidney transplant. You wont be automaticallyenrolled, so you need to contact Social Security or the Railroad RetirementBoard to start the process.
Who Runs Medicare And Medicaid
The federal government runs the Medicare program. Each state runs its own Medicaid program. Thats why Medicare is basically the same all over the country, but Medicaid programs differ from state to state.
Although each state designs and runs its own Medicaid program, all Medicaid programs must meet standards set by the federal government in order to get federal funds.
The Centers for Medicare and Medicaid Services, part of the federal government, runs the Medicare program. It also oversees each states Medicaid program to make sure it meets minimum federal standards.
In order to make significant adjustments to their Medicaid programs, states must seek permission from the federal government via a waiver process.
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The Interaction Between Medicare Premiums And Social Security Colas
Social Security and Medicare assist in providing financial security to most elderly and disabled individuals in the United States. Certain interactions between Social Security and Medicare may have important financial implications for individuals who are enrolled in both programs.
Social Security provides monthly cash benefits to retired or disabled workers and their family members. The Social Security benefits that are paid to retired workers are based on workersâ past earnings. Medicare is a federal insurance program that pays for covered health care services for most individuals aged 65 and older. Medicare Part B and Part D are voluntary, premium-based programs for Medicare beneficiaries providing coverage for physician services and prescription medications . Standard Medicare Part B and Part D premiums are set at a rate each year to cover approximately 25% of per capita program costs. High-income beneficiaries may pay higher than standard premiums. Individuals who are enrolled in both Social Security and Medicare must have their Medicare Part B premiums automatically deducted from their monthly Social Security benefit and may choose to have their Medicare Part D premiums automatically deducted from their monthly Social Security benefit.
Can I Help Someone With An Ssi Application
If you or someone you know needs help with their application, you must have an Appointment of Representative form .
If you or someone you know does not speak English well, you may not need a representative. Social Security can provide a free interpreter .
If you or someone you know is deaf or hard of hearing, you can bring an ASL interpreter or use a Social Security Administration interpreter at no cost.
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After All The Program Is Wholly Run By The Government
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Socialism is a loaded word in the United Statesa country where capitalism is the prevailing economic system and is the basis for the system of government. One situation in which the word tends to come up is when Americans look at government programs, especially Social Security. To understand what the debate is about, lets first review some terms.
Who Runs The Social Security System
The United States government, not individuals or businesses, runs the Social Security system. It tracks Social Security earnings and benefits, runs the website that lets people check their benefits record, approves or denies retirement benefit applications, collects Social Security taxes, and distributes retirement, disability, and other benefits.
While the government does hire independent contractorssuch as Lockheed Martin Corporation, International Business Machines Corp., Dell, et al.to provide telecommunications, data storage, and other services, the government is in full control of Social Security.
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Will Part B Deduct From My Social Security Check
Yes, Social Security will deduct your Part B premiums from your check. No need to worry about paying your monthly Part B premium unless you dont collect Social Security. The Part B premium is deducted out of your Social Security check automatically. The amount that comes out will depend on your income. The standard Part B premium amount does change annually.
Which Should I Apply For
With so much overlap, it can be difficult to determine which program you should apply for. Here are a few basic guidelines to keep in mind:
- Disabled and unable to work: Social Security disability benefits
- Solid work history: Medicare or DIB
- Little to no income: Medicaid or SSI
- Disabled but havent worked much over the past 10 years: SSI
- Disabled, not working, solid work history: DIB
- Under 65 years old, not disabled: Medicaid
Does Social Security Pay For Medicare
Social Security does not pay for Medicare, but if you receive Social Security payments, your Part B premiums can be deducted from your check. This means that instead of $1,500, for example, youll receive $1,386.40 and your Part B premium will be paid.
Now lets take a look at Medicare and Social Security to understand what these important benefit programs are, how you qualify, and what they mean for you.
How Can I Apply
Now that you know about the differences between the two programs, who is eligible, and what is covered, you are probably wondering how you can apply for them. Lets start with Medicare. Enrollment in Original Medicare is automatic in many cases. Upon reaching the age of 65, you will be automatically enrolled in Medicare if you are already receiving Social Security retirement benefits. Also, you will be automatically enrolled after 24 months of receiving SSDI payments. If you do not receive retirement benefits, then you can apply for Part A coverage and start receiving coverage upon paying the premium amounts. You can apply for Medicare through the Medicare website or over the phone.
If you choose to delay enrollment, then you can enroll during the yearly Medicare open enrollment period. Waiting too long may require you to pay a late enrollment penalty to obtain coverage. In addition, if you choose to apply for Part B, C, or D coverage, then you should contact your insurance company or agent to discuss those options. Since those plans are administered by private companies, they each have their own rules about enrollment and pricing.
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Social Security Vs Private Retirement Accounts
Individuals with private retirement savings accounts have more control over how much and when to contribute than they do with paying Social Security taxes. For example, if you work for a company that offers a 401 plan, you can decide what percentage of each paycheck to redirect to that accountalthough government regulations place restrictions on how much you can contribute.
In 2021, the annual limit on 401 contributions is $19,500 . Furthermore, you cannot contribute to a Roth individual retirement account if your adjusted gross income is $140,000 or higher for singles and $208,000 or higher for married couples filing jointly.
What Is Medicare What Is Medicaid
Medicare is a federal program generally for people who are 65 or older or have a qualifying disability or medical condition. Medicare Part A and Part B are provided by the federal government, and Medicare Part C and Part D, while federally governed, are provided by private insurance companies.
Medicaid is a state government program that helps pay health care costs for people with limited income and resources, and different programs exist for specific populations. Medicaid plans vary from state-to-state but follow federal guidelines for benefits.
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Ssi Vs Ssdi // Whats The Difference
You have probably heard the terms SSI and SSDI on TV commercials, but what do they really mean? If you have a disability and are unable to work, you might be trying to obtain disability benefits but have gotten confused over what you could qualify for. Both of these programs help provide financial assistance to people with disabilities, but there are some differences between the two. Whether you have worked in the past, your age, and other factors will determine which program you may qualify for. So, if youre wondering What is the difference between SSI and SSDI, then you have come to the right place. Keep reading as we explain the difference between the two as well as tell you how to apply and how long the application process typically takes.
Medicare Vs Medicaid: How Medicaid Works
Medicaid is a need-based joint federal and state insurance program that covers low-income individuals and families. That said, Medicaid coverage can vary significantly from state to state. Thats because the federal government covers up to 50% of each states Medicaid program costs. This means all remaining Medicaid program costs must be paid for at the state level.
Unlike Medicare, Medicaid isnt available to everyone and it has very strict eligibility requirements. To qualify for Medicaid coverage, you must either already be receiving SSI benefits or fit within a mandatory eligibility group. If your financial resources arent limited enough to qualify for SSI, you may still qualify for state-based Medicaid assistance programs. For more information about the updated Medicaid eligibility requirements under the Affordable Care Act , visit the Medicaid.gov website.
While each states coverage varies , the federal government requires that there is coverage for the following services as long as theyre deemed medically necessary.
- Preventive care for children under 21
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How The Programs Differ
Medicare is an insurance program while Medicaid is a social welfare program.
Medicare recipients get Medicare because they paid for it through payroll taxes while they were working, and through monthly premiums once theyre enrolled.
Medicaid recipients need never have paid taxes and most dont pay premiums for their Medicaid coverage .
Taxpayer funding provides Medicaid to eligible needy people in a manner similar to other social welfare programs like Temporary Assistance for Needy Families Women, Infants and Children and the Supplemental Nutrition Assistance Program.
How Do I Apply For Ssi Or Ssdi
You can apply online for these disability programs through the SSAs website. This is true for both applying for SSDI and applying for SSI benefits. You can complete the application, and you will also need to provide thorough medical records that show proof of your disability . If you do not have access to a computer or the Internet, you can also apply for these benefits at your local Social Security office. You can also apply for benefits over the phone by contacting the SSA through their toll-free number. Do not get this confused with the process of applying for Social Security retirement benefits.
Some people even contact a law firm for assistance with the application process, though many people wait until their initial application has been denied. An attorney can then help you through the appeals process and make sure all your records are in order to help you get qualified.
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Funding For Social Security And Medicare
Both programs are primarily funded by payroll taxes, which are split evenly between employees and employers . The Social Security tax rate is higher, but theres an upper income limit above which Social Security taxes are not levied. The Medicare tax rate is lower, but it applies to all wages. Together, Medicare and Social Security payroll taxes are known as FICA taxes .
Lawmakers on both sides of the aisle have proposed a variety of reforms for both Social Security and Medicare, but Republicans are much more likely to focus on privatization, means testing, and increasing the age at which people become eligible for benefits.
Former Speaker of the House, Paul Ryan, proposed various Medicare reforms in budget proposals during his time in office, including privatization, means testing, and raising the eligibility age to 67. Not surprisingly, Ryans proposals failed to gain bipartisan support, but have remained quite popular with Republicans.
Similar proposals have been advanced regarding Social Security, with GOP lawmakers often calling for an increase to the full retirement age for Social Security. Theyve also proposed privatizing the program, adding means testing, or a combination of all three approaches.
Some Democrats have proposed expanding the Social Security tax so that it applies to all income, a move that would increase revenue and stabilize the program without the need to reduce benefits.
What Are Social Security Benefits
The Social Security program that we know today originally began in 1935, when the Social Security act was signed into law by President Franklin D. Roosevelt as part of the Second New Deal. The primary goal of the Act was to provide financial aid for children, the unemployed, and the elderly. At the time the legislation was passed, the country was still only midway into the Great Depression, and the Social Security Act was accompanied by several other measures designed to jumpstart the economy and provide financial relief to those in need.
Social Security benefits include the following:
- Social Security Disability Income benefits
- Survivor benefits
- Social Security benefits for children
- Supplemental Security Income benefits
- Social Security retirement benefits
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How To Apply For Ssi
Even if you are not sure whether or not you are eligible, it may be a good idea to apply for SSI as soon as possible so that you dont miss out on valuable benefits. There is no charge to complete the SSI application.
There are a few ways to apply. You can:
- Visit your local Social Security office
If you are applying in person, be sure to bring financial and medical documentation with you. You may need proof of age, citizenship status, medical history/disability, income, and resources.
Who Is Eligible For Ssi
You can qualify for SSI if you:
- are over 65
- are legally blind
- have a disability
As with all Social Security benefits, youll also need to be a United States citizen or legal resident and have limited income and resources. However, to apply for SSI, you dont need work credits.
You can receive SSI in addition to SSDI or retirement benefits, but it can also be a standalone payment. The amount you receive in SSI will depend on your income from other sources.
Social Security Disability Insurance is a type of Social Security benefit for those with disabilities or health conditions that prevent them from working.
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You May Qualify For Legal Assistance
Figuring out which healthcare plan will cover you can be confusing especially if you havent yet filed your disability claim. A local disability advocate can walk you through Medicare vs Medicaid coverage available in your state. Its almost impossible to tell whether youre eligible for healthcare assistance programs without first knowing your individual circumstances and location.
Ready to see if you may qualify? Click the button below to start your free online benefits evaluation now!