Medicare and Medicaid are not the same, and that confusion is costly
They sound alike and that's where the similarity ends. I see it constantly, and it's the misunderstanding that causes the most trouble in the families I work with.
- Medicare is a federal program based on age: you reach 65 and it's yours, whatever you earn. Certain people with disabilities or end-stage renal disease qualify earlier.
- Medicaid is a state program based on income: you qualify if you earn little, whatever your age. The rules vary a lot from state to state.
And yes, you can have both at once. Someone with both is called dually eligible, and usually has access to special plans at very little or no cost. If you think you might be in that group, say so: it completely changes what suits you.
Why I insist on this
Many people arrive saying they have Medicare when they actually have Medicaid, or the other way around. Starting there saves half an hour of the wrong conversation and, sometimes, an enrollment that shouldn't have happened.
The four parts, and what each is for
Medicare isn't one thing: it's four pieces. They combine in two different ways, and choosing which of the two is the whole decision.
- Part A, the hospital. Admissions, skilled nursing stays, hospice. Most people pay no premium for it, because they already paid through work.
- Part B, the doctor. Visits, lab work, prevention, ambulance, medical equipment. This one has a monthly cost, usually deducted from Social Security.
- Part C, Medicare Advantage. Not separate coverage: it's receiving your A and B through an approved private carrier, almost always with extras.
- Part D, prescriptions. Bundled inside an Advantage plan, or bought separately if you stay with Original.
The foundation
A and B together are what people call Original Medicare. Everything else, Advantage, a supplement or Part D, is built on top of that base. It never replaces it.
Advantage isn't added to Medicare, it's another way of having it
This is where most people get lost. A Medicare Advantage plan is not extra insurance laid on top. You stay enrolled in Medicare and keep paying your Part B, but from then on it's the private carrier, not Medicare, that manages your coverage and decides what gets approved.
From that comes a consequence that surprises everyone: you cannot hold a Medigap supplement alongside an Advantage plan. Medigap exists to fill the gaps in Original. If you move to Advantage, that supplement stops helping you even if you keep paying for it.
- With Advantage you pay less monthly and hand over copays each time you use care, within a specific network.
- With Original plus a supplement you pay more monthly and almost nothing when using it, and you can see any doctor in the country who accepts Medicare.
How I frame it
It isn't choosing between more or less coverage. It's choosing whether you'd rather pay little and absorb surprises, or pay more and sleep easy. It depends on your doctors, your prescriptions, how much you travel and how much uncertainty bothers you.
What Medicare never pays for
Almost nobody shows you this list before you sign, and it's exactly where the costs nobody expected come from.
- Long-term care. Medicare doesn't pay for living in a nursing home indefinitely. It only covers short recovery stays after a hospitalization, with conditions.
- Routine dental, vision and hearing. Original doesn't cover them. Many Advantage plans include something, and that's a large part of their appeal.
- Care outside the country. Except in very specific cases, there's no coverage abroad. Important if you travel to see family.
- Whatever the carrier doesn't consider necessary. An unapproved procedure is on you, even if your doctor ordered it.
The four questions to ask
For any plan you're offered, ask about these four before asking the price. They're behind almost every complaint the following year.
