The core difference: who pays and who gets covered

Medicare is a federal insurance program you pay into through payroll taxes during your working years. You become covered at 65, regardless of income. Medicaid is a joint federal and state program that covers people below certain income limits, at any age. Medicare is about age; Medicaid is about money.

Medicare comes from the same Social Security system that pays retirement benefits. Medicaid comes from general tax revenue and is run by each state with federal funding. This means a Medicaid program in California works differently from one in Texas — income limits, covered services, and payment rates all vary by state.

You can have both programs at the same time. People over 65 with low income often do. When you have both, Medicare is your primary payer and Medicaid fills in gaps — copays, deductibles, and services Medicare does not cover.

Key Takeaways

  • Medicare covers people 65 and older, regardless of income, because they paid into the system while working.
  • Medicaid covers people of any age whose income falls below their state's limit, which ranges from roughly $1,500 to $2,500 monthly for an individual depending on the state.
  • Medicare is run by the federal government; Medicaid is run by each state, so coverage and income rules differ by location.
  • You can hold both programs at once, and Medicaid will cover costs Medicare does not pay.
  • Applying for Medicare happens automatically at 65 if you receive Social Security; applying for Medicaid requires a separate application to your state.

Income limits and who qualifies for each program

Medicare has no income limit. If you are 65 or older and a U.S. citizen or permanent resident, you can enroll. The only exception is if you are still working and your employer offers health insurance — you can delay enrollment without penalty, but you do not have to.

Medicaid income limits are set by each state and change yearly. Most states use the federal poverty line as a starting point, then add a percentage. In 2024, the federal poverty line for an individual is roughly $14,600 annually. Some states cover people up to 138% of that amount; others cover only up to 100%. A few states have higher limits for specific groups like pregnant people or children. You need to check your state's current limits — they are published on your state Medicaid office website.

Medicaid also counts assets in some states. If you own a home, a car, or savings above a certain threshold, you may not may have access to, even if your monthly income is low. Medicare does not count assets at all.

What each program covers and what it costs

Medicare Part A covers hospital stays, skilled nursing care after hospitalization, hospice, and some home health services. Part B covers doctor visits, outpatient care, and preventive services. Part D covers prescription drugs. You pay a monthly premium for Part B and Part D; Part A is free if you paid Medicare taxes for at least 10 years. You also pay deductibles and copays when you use services.

Medicaid covers doctor visits, hospital care, emergency services, prescription drugs, and preventive care. Most states also cover dental, vision, and mental health services — Medicare does not. Medicaid copays are usually lower than Medicare copays, and some states charge no copay at all. Medicaid does not charge a monthly premium.

The trade-off: Medicare gives you more choice of doctors and hospitals nationwide. Medicaid often limits you to providers in your state's network, and not all doctors accept Medicaid. But Medicaid covers more types of services, especially long-term care and dental work.

How to enroll and when enrollment happens

Medicare enrollment happens automatically. If you receive Social Security retirement benefits, Medicare Part A and Part B start the month you turn 65. If you do not receive Social Security, you must contact Social Security three months before your 65th birthday to enroll. You can enroll online at ssa.gov, by phone at 1-800-772-1213, or in person at your local Social Security office.

If you miss your initial enrollment window, you can still enroll, but you may pay a permanent penalty on your premiums. The penalty is 10% per year you delayed, for as long as you have Medicare. This is why enrolling on time matters.

Medicaid enrollment is separate and happens through your state. You apply directly to your state Medicaid office, usually online through your state's website or by mail. Processing takes two to 45 days depending on the state. You must reapply yearly or when your income or household size changes. Some states use continuous enrollment, meaning you stay covered as long as you report changes; others require annual renewal.

What happens if you have both Medicare and Medicaid

People who have both are called dual may be able to access. This is common for people over 65 with low income. When you have both, Medicare pays first for services it covers. Medicaid then pays Medicare's copays, coinsurance, and deductibles. Medicaid also covers services Medicare does not, like dental and vision.

If you are dual may be able to access, you do not pay premiums to Medicaid. Your state Medicaid program handles the coordination automatically once both programs know about each other. You will receive cards from both programs and may need to show both when you see a provider.

Some states offer special Medicaid plans for dual may be able to access people that coordinate care more closely. Ask your state Medicaid office whether your state has a dual may be able to access program and whether you should enroll.

State differences that affect your coverage

Medicaid rules change at the state border. One state might cover dental care and another might not. One state's income limit might be $1,800 monthly and another's might be $2,400. One state might count a car as an asset that disqualifies you; another might not.

If you move to a different state, your Medicaid coverage does not move with you. You must apply for Medicaid in your new state. Your new state will process your application based on its own rules. This can mean you lose coverage for a few weeks during the transition, or that you become newly covered in a state with higher income limits.

Medicare is the same everywhere in the U.S., so moving does not affect your Medicare coverage. But your Medicare provider network might change, so you should check whether your current doctors accept Medicare in your new location.

How to find out which program you should focus on

If you are 65 or older, you are automatically in Medicare territory. Your task is to enroll on time and choose your coverage options — Original Medicare with a Medigap plan, or a Medicare Advantage plan. Medicaid is secondary and only matters if your income is low enough to may have access to in your state.

If you are under 65, Medicaid is your only option among these two programs. You cannot get Medicare until you turn 65, with rare exceptions for people on disability. Check your state's Medicaid income limits to see whether you may have access to. You can do this on your state Medicaid office website or by calling 211, which connects you to local benefits programs.

If you are unsure whether you may have access to for Medicaid in your state, gather your recent pay stubs, tax return, and proof of residency, then contact your state Medicaid office. They will tell you whether you may have access to and walk you through the application if you do.

Frequently Asked Questions

Can I have Medicare and Medicaid at the same time?

Yes. If you are 65 or older with low income, you may may have access to for both. Medicare pays first for covered services, and Medicaid covers the gaps. You do not pay Medicaid premiums when you are dual may be able to access. Contact your state Medicaid office to see whether you may have access to.

What if I turn 65 but I am still working?

You can delay Medicare enrollment without penalty if your employer offers health insurance. When you leave that job or lose the coverage, you have eight months to enroll in Medicare without paying a late penalty. If you do not enroll during that window, the penalty applies permanently.

Does Medicaid cover dental and vision care?

Most states cover dental and vision through Medicaid, but coverage varies. Some states cover cleanings and basic care; others cover more. Check your state Medicaid website or call your state office to see what your state covers. Medicare does not cover routine dental or vision care.

If I move to a different state, do I keep my Medicaid coverage?

No. Medicaid is state-run, so your coverage ends when you move. You must apply for Medicaid in your new state based on that state's income limits and rules. Processing usually takes two to 45 days. Medicare coverage moves with you and does not change.

How do I know my state's Medicaid income limit?

Visit your state Medicaid office website — search "[your state] Medicaid income limits" — or call 211 to speak with someone who can tell you your state's current limits. Income limits change yearly and vary by household size, so you need the current year's numbers for your situation.