Short answer: Medicare is federal health insurance primarily for people 65 and older (or with certain disabilities). Medicaid is a joint federal-state program for people with low income. They're run by different agencies, have different eligibility rules, and cover different things - but some people qualify for both.
Medicare vs. Medicaid at a Glance
Here's the fastest way to understand the core differences:
| Medicare | Medicaid | |
|---|---|---|
| Who runs it | Federal government (CMS) | State + federal partnership |
| Who qualifies | Age 65+, or under 65 with certain disabilities/ESRD | Low-income individuals and families |
| Based on | Age and work history | Income and household size |
| Premiums | Part B: $202.90/month (2026); Part D varies | Usually $0 (some states have small copays) |
| Deductibles | Part A: $1,736/benefit period; Part B: $283/year | Usually $0 |
| Covers long-term care | Very limited (up to 100 days skilled nursing) | Yes - nursing home and home care |
| Dental/vision | Generally not covered (some MA plans include it) | Often covered (varies by state) |
| Can you have both? | Yes - called "dual eligible" | |
What Is Medicare?
Medicare is a federal health insurance program created in 1965. It works the same way in every state. You qualify based on age or disability status - not income.
Who Qualifies for Medicare?
- Age 65 or older - if you or your spouse paid Medicare taxes for at least 10 years (40 quarters)
- Under 65 with a qualifying disability - after receiving Social Security Disability Insurance (SSDI) for 24 months
- Any age with End-Stage Renal Disease (ESRD) - permanent kidney failure requiring dialysis or a transplant
- Any age with ALS (Lou Gehrig's disease) - eligible immediately upon SSDI approval
The Four Parts of Medicare
- Part A (Hospital Insurance): Covers inpatient hospital stays, skilled nursing, hospice, and some home health care. Most people pay $0 in premiums. Deductible: $1,736 per benefit period in 2026.
- Part B (Medical Insurance): Covers doctor visits, outpatient care, preventive services, and medical equipment. Premium: $202.90/month in 2026. Deductible: $283/year.
- Part C (Medicare Advantage): A private-plan alternative to Original Medicare that bundles Parts A, B, and usually D. Often $0 additional premium but uses provider networks.
- Part D (Prescription Drugs): Covers prescription medications through private plans. Premiums vary ($10 to $60/month). Out-of-pocket cap: $2,100/year in 2026.
Learn more about what Medicare actually costs in 2026.
What Is Medicaid?
Medicaid is a joint federal-state program that provides health coverage to people with limited income. Unlike Medicare, Medicaid rules and benefits vary significantly by state. Each state runs its own program under federal guidelines.
Who Qualifies for Medicaid?
Eligibility is based primarily on income, measured as a percentage of the Federal Poverty Level (FPL). In states that have expanded Medicaid (including Nebraska):
- Adults under 65: Income up to 138% FPL (~$20,783/year for an individual in 2026)
- Pregnant women: Income up to 200% FPL in most states
- Children: Income thresholds are higher - often up to 200% to 300% FPL depending on the state
- Seniors 65+: May qualify for Medicaid in addition to Medicare if income is low enough
- People with disabilities: May qualify regardless of age
Medicaid in Nebraska (Heritage Health)
Nebraska expanded Medicaid in 2020, extending coverage to adults earning up to 138% FPL. The program is called Heritage Health and is managed through three managed care organizations. Coverage includes:
- Doctor visits and hospital care
- Prescription drugs
- Mental health and substance abuse treatment
- Dental care (limited for adults)
- Vision care
- Long-term care and nursing home coverage
- Transportation to medical appointments
You can apply for Nebraska Medicaid at any time - there is no open enrollment period. Applications are processed through ACCESSNebraska.
Can You Have Both Medicare and Medicaid?
Yes. People who qualify for both programs are called "dual eligibles." Approximately 12 million Americans have both Medicare and Medicaid.
If you're dual eligible:
- Medicare is your primary insurance - it pays first for doctor visits, hospital stays, and most medical services
- Medicaid is your secondary insurance - it covers what Medicare doesn't, including long-term care, dental, vision, and out-of-pocket costs like premiums, deductibles, and copays
- You may qualify for a Dual Special Needs Plan (D-SNP) - a type of Medicare Advantage plan designed specifically for dual eligibles that coordinates both benefits
- Medicaid may pay your Part B premium ($202.90/month) through a Medicare Savings Program, saving you over $2,400/year
Medicare Savings Programs
Even if you don't fully qualify for Medicaid, you may qualify for a Medicare Savings Program (MSP) that helps pay Medicare costs:
- QMB (Qualified Medicare Beneficiary): Pays Part A and B premiums, deductibles, copays, and coinsurance. Income limit: ~100% FPL.
- SLMB (Specified Low-Income Medicare Beneficiary): Pays Part B premium only. Income limit: ~120% FPL.
- QI (Qualifying Individual): Pays Part B premium only. Income limit: ~135% FPL.
These programs are massively underutilized - millions of Medicare beneficiaries qualify but have never applied. If you're on a fixed income, it's worth checking. Learn more about Medicare Extra Help programs.
Common Points of Confusion
"I'm 65 and low-income - which do I get?"
You get Medicare automatically at 65 (if you qualify through work history). You may also get Medicaid if your income is low enough. They're not either/or - many seniors have both.
"I'm on Medicaid and turning 65 - what happens?"
You'll need to enroll in Medicare when you turn 65. Your Medicaid doesn't replace Medicare - Medicare becomes your primary coverage, and Medicaid acts as a supplement. Failing to enroll in Medicare on time can result in late-enrollment penalties. Check the Turning 65 Medicare checklist.
"Does Medicaid cover nursing homes? Does Medicare?"
Medicaid is the primary payer for long-term nursing home care in the United States. Medicare only covers up to 100 days in a skilled nursing facility (and only after a qualifying hospital stay). If you need long-term custodial care, Medicaid is the program that covers it - but you must meet strict income and asset limits.
"My income went up - will I lose Medicaid?"
Possibly. Medicaid eligibility is re-evaluated periodically (typically annually). If your income rises above the threshold, you'll transition off Medicaid. However, you can then enroll in an ACA Marketplace plan with subsidies - losing Medicaid is a qualifying event for Special Enrollment.
"Is the ACA Marketplace the same as Medicaid?"
No. The ACA Marketplace (Healthcare.gov) sells private health insurance plans with subsidies for people earning 100% to 400%+ FPL. Medicaid is a separate government program for those below ~138% FPL. When you apply on Healthcare.gov, the system automatically checks if you qualify for Medicaid first. Read more about how ACA subsidies work.
Quick Decision Guide
- 65+ with any income? → You qualify for Medicare. Check if you also qualify for Medicaid or a Medicare Savings Program.
- Under 65, low income? → Apply for Medicaid (no enrollment period - apply anytime).
- Under 65, income above Medicaid threshold? → ACA Marketplace plans with subsidies.
- Under 65 with a disability? → You may qualify for Medicare after 24 months of SSDI. You may also qualify for Medicaid immediately based on income.
- 65+ and low income? → You likely qualify for both (dual eligible). This gives you the most comprehensive coverage available.
Bottom Line
Medicare and Medicaid serve different populations with different rules - but they work together for millions of Americans. The most common mistake is assuming you only qualify for one or the other, when many people (especially low-income seniors) are eligible for both.
If you're unsure which programs you qualify for, schedule a free consultation. I'll help you sort through Medicare, Medicaid, and Marketplace options to find the best coverage for your situation.