Medicare is the principal state-administered health insurance program in Arizona and the rest of the US. It aims to address the needs of seniors (65 and older), as well as younger adults with qualifying disabilities and diseases. Since it’s not all encompassing in terms of coverage, many people purchase additional coverage, such as one of the Medicare supplements in Phoenix AZ, commonly referred to as Medigap plans.
Meanwhile, financially vulnerable populations can use the benefits of the joint federal and state program called Medicaid, designed to help with their medical costs. Here are some Medicaid basics explained to help you get more acquainted with this health insurance program.
What is Medicaid?
Medicaid is a health insurance program providing assistance to families with low income and limited resources that cannot afford healthcare coverage. The program provides full coverage for its low-income beneficiaries, whereas moderate-income beneficiaries receive substantial coverage.
Medicaid is jointly funded by the federal and state governments and managed by the states. Each state has the freedom to set its own eligibility criteria. Common criteria for all states include US citizenship and permanent residency status. Low-income families, people with certain disabilities and pregnant women can also qualify for Medicaid.
Poverty is a criterion, but it does not make a person automatically eligible for Medicaid. Financial eligibility is defined in terms of income and resources. Thanks to the Patient Protection and Affordable Care Act, the eligibility and funding for Medicaid have increased significantly.
What does Medicaid cover?
Medicaid coverage varies between states and people are advised to contact their state’s Medicaid office in order to fully understand the coverage options. Under federal law, each state must provide a minimum benefit package, including:
Although Medicaid doesn’t cover prescription drugs, the program can pay the premium for Medicare prescription drug coverage (Medicare Part D). In addition to Medicaid, each state also runs a Children’s Health Insurance Program (CHIP), designed to cover children from families whose income is modest, but still too high to qualify for Medicaid. In some states, CHIP also assists parents and pregnant women.
The Children’s Health Insurance Program covers dental care, eye exams and eyeglasses, regular checkups, prescription drugs and vaccines, specialty services and mental healthcare, hospital care, medical supplies, x-rays, lab tests and treatment of pre-existing conditions. In each state, Medicaid and CHIP work closely together to address the needs of their target populations. They are evolving and improving from the aspect of eligibility, enrollment and renewal, thanks mainly to the flexibility enabled by the Affordable Care Act.
Medicare supplements in Phoenix AZ and Medicaid – are they related?
Many people confuse Medicare and Medicaid, despite their apparent differences. In a nutshell, these are the main differences between the two programs:
- Medicare is a federal program addressing the needs of people aged 65 and older, as well as people with certain diseases and disabilities. Medicare is available to people of all income levels and the coverage is the same in all states.
- Medicaid is a joint federal & state program providing healthcare benefits to people of all ages, available to those of low income and resources. Medicare programs are different in each state.
Sometimes, Medicaid can work together with Medicare to cover healthcare costs. In other words, Medicaid can help Medicare policyholders with the payment of excessive medical bills that Medicare doesn’t cover. In this case, for services covered by both Medicare and Medicaid (doctor visits, hospital care, home care and skilled nursing facility care), Medicare is the primary payer, whereas Medicaid covers the remaining costs, such as coinsurances and copays.
Who is eligible for Medicaid?
Each state has its own eligibility and application rules within the federal standards, and the state Medicaid offices are best suited to answer all your questions. Medicaid and CHIP provide assistance to around 60 million Americans, including children, pregnant women, parents, elderly and disabled people. Federal law requires all states to include certain population groups in their Medicaid coverage (mandatory eligibility groups).
Each state has the freedom to cover additional groups (optional eligibility groups) and many states have decided to expand the scope of coverage, especially for children, beyond the required federal minimum. Since each state individually decides how to design its Medicaid program, a person’s ability to qualify can depend on whether their state of residence has decided to expand its Medicaid coverage to include more people.
Generally, the eligibility assessment for Medicaid and CHIP coverage is based on income, household size, disability, family status and some additional factors. Certain states have expanded Medicaid coverage to all low-income adults. In this case, people can qualify for Medicaid based solely on income and family size.
Some people are eligible for both Medicare and Medicaid. This is called dual eligibility. If a person has Medicare and full Medicaid, most of their healthcare costs are likely to be covered. In all states, people can apply for Medicaid in one of two ways – either directly through the state’s Medicaid agency or by filling out a Marketplace application. The applications for Medicaid and CHIP can be submitted any day of the year (not only during Marketplace Open Enrollment).
What is Medicaid spend-down?
Spend-down is an option within Medicaid designed to help people pay huge medical bills, which are beyond their payment abilities. People whose income exceeds the Medicaid eligibility levels are referred to as having excess income.
They can nonetheless become eligible under the spend-down program (as persons that are medically needy), if this excess income is spent on medical bills. With the spend -down option, the person pays the bills up to the excess amount and Medicaid pays the rest.
To become eligible as medically needy, a person’s resources must be under the resource amount allowed in the particular state. The spend-down option is available to children under 21 years of age, adults over 65 years of age, the disabled and the blind, as well as families where one or both parents are absent, diseased, disabled or out of work.