Medicare vs. Medicaid

Medicare: Federal Health Insurance for Older Adults

Medicare covers people 65 and older (and some younger people with disabilities), regardless of income:

• Part A — hospital stays, skilled nursing facility care (short-term), hospice
• Part B — doctor visits, outpatient care, preventive services
• Part C (Medicare Advantage) — private plans bundling A, B, and usually D
• Part D — prescription drugs

Beneficiaries pay premiums, deductibles, and copays. Enrollment timing matters — missing your initial enrollment window can mean lifetime penalties.

Medicaid: Health Coverage Based on Financial Need

Medicaid is run jointly by the federal government and states, for people with limited income and resources. It covers a broad range of health services — and crucially, it is the primary payer for long-term nursing home care. Eligibility rules, covered services, and application processes vary significantly by state.

The Critical Difference for Long-Term Care

This is the misunderstanding that catches families off guard: Medicare generally does not pay for long-term custodial nursing home care. When a parent needs months or years of nursing home care, families often look to Medicaid, long-term care insurance, veterans benefits, or private funds.

Planning Considerations

Medicaid’s strict asset limits and its “look-back” review of past asset transfers make advance planning important — and the rules are technical and state-specific. Free help is available: every state has a SHIP program offering unbiased Medicare counseling, and local Area Agencies on Aging (via the Eldercare Locator) can point you toward Medicaid resources.