Dually Eligible for Medicare and Medicaid

Helpful Highlights

• People can be dually eligible for both Medicare and Medicaid together.

• Medicare pays first and Medicaid is the payer of last resort (pays last).

• Dual eligibility makes a difference, financially, in health care costs.

It is possible for your loved one to be eligible for both Medicare and Medicaid. Financially, this would make a difference in health care costs for your loved one.

Even though they are both categorized under the Center for Medicare and Medicaid Services (CMS), Medicare and Medicaid are two separate, government-run programs. They are operated and funded by different parts of the government and primarily serve different groups.

Here are some basics... 

Medicare 

• Funded by Social Security income and employer tax contributions (FICA). 

• Federal entitlement program that provides health coverage for those 65 and older, or under 65 with a disability, no matter the recipient's income. (Disability examples are Alzheimer's disease, Parkinson's disease, mental illness, and multiple sclerosis.)

• There are no eligibility requirements beyond age, or age and disability.

Medicaid 

• State- and federally-funded program that provides health coverage for those with very low income.

• Eligibility and benefits vary considerably from state to state, but all are income-dependent. 

• Contact your state Medicaid office to learn more about the eligibility requirements and coverage available.

• Medicaid offers benefits not normally covered by Medicare, like nursing home care and personal care services. 

Eligibility for Medicaid

• Medicaid is based on income and family size. 

• Eligibility rules differ among states and are too numerous to list here.

• Medicaid health coverage is available in all states for elderly people with certain incomes, and people with disabilities. 

• The state’s rules for income and resources must be met to qualify.

Dual eligibility

People who qualify for both Medicare and Medicaid coverage are called “dually eligible.” In dual eligibility, Medicare-covered services are received and Medicare pays first. Medicaid pays last, after Medicare and any other health insurance your loved one has (such as a partial pension plan).

• If your loved one is eligible for both Medicare and Medicaid (dually eligible), they can have both. The programs work together to provide health coverage and lower costs. Oftentimes, together they cover 100% of medical costs (though not always).

• Medicare and Medicaid are both health insurance programs administered by the government, but there are differences in covered services and cost-sharing.

With dual eligibility, your loved one can still choose how they want to receive their Medicare coverage - either through Original Medicare (Parts A & B) or through a Medicare Advantage plan (Part C).  

What Medicaid pays for

With Medicare and Medicaid coverage, the state will pay for Medicare Part B monthly premiums. The state will also pay Part A premiums (if your loved one is required to pay them).

Depending on the level of Medicaid qualified for, the state might also pay for your loved one's share of Medicare costs, like deductibles, coinsurance, and copayments.

Medicaid offers extra help with drug costs and may pay for drugs and other services that Medicare doesn't cover.

How to apply for Medicaid

Contact your state Medical Assistance (Medicaid) office.

Working together

Medicaid provides secondary insurance for services covered by Medicare and Medicaid, such as provider visits, hospital care, home care, and skilled nursing facility care.

• Medicare is the primary payer. 

• Medicaid is the payer of last resort, meaning it always pays last, behind Medicare and any other insurance held. 

• What else can Medicaid provide?

  • Premium assistance - the state provides assistance with employer-sponsored insurance premiums.

  • Cost-sharing assistance.

  • Prescription drug assistance.

  • Care coordination.