What is the difference between Medicare and Medicaid?
Both Medicare and Medicaid were created as part of the Social Security Act.
Medicare is a federally funded and
administered program that provides health insurance for
older Americans and those who are disabled. Individuals
contribute to Medicare during their working years, just
as they do to Social Security. Since Medicare is a
federal health insurance program, eligibility guidelines
and services are much the same all over the country.
Medicare does not cover all health care services, nor
does it pay the entire cost of all the services that it
Medicaid, on the other hand, is financed and run jointly by the federal and state governments. The program provides health care for individuals of all ages who have no other means to pay for it. States set the eligibility guidelines and benefits, which can vary greatly from state to state. However, eligibility is usually based on low-income status and medical necessity. Benefits frequently include health screenings and services for children, hospital services, care in nursing homes or hospices, and some prescription drugs.
Gail Carlson, MPH Ph.D., Continuing Medical Education, School of Medicine, University of Missouri-Columbia
Last update: Wednesday, November 26, 2008