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Medicare and Medicaid Together: How Secondary Insurance Works
- January 12, 2024
- Reviewed by John Krahnert
Medicaid helps pay for health care services for people who have limited financial resources.
Medicare is a federally-run health insurance program for Americans age 65 and older and some younger people with a qualifying disability.
Depending on where you live, your financial resources and other factors, you may be eligible for Medicare, Medicaid or both. You may also be eligible for a Medicare Dual Eligible Special Needs Plan (D-SNP) — a type of Medicare Advantage plan — if any are available where you live.
Learn more about Medicare and Medicaid – including how they are different as well as how they can work together – so that you can find the coverage that best fits your needs.
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Medicare vs. Medicaid
It’s important to understand some of the differences between Medicare vs. Medicaid, and also how the two programs work together.
Two primary differences between Medicare and Medicaid are:
- Medicare eligibility requirements are the same for everyone in the United States, no matter where you live.
- Medicaid is administered by state governments, so eligibility requirements can differ between states.
What are primary and secondary payers?
For beneficiaries who qualify for both programs, Medicare always acts as the primary payer for medical services, while Medicaid serves as the secondary payer.
That means Medicare is the first to pay for covered services and items, and then Medicaid pays for any remaining qualified costs.
There are several different ways that Medicaid and Medicare can work together.
- Secondary insurance
Medicare pays first, and then Medicaid may pick up the cost of some out-of-pocket Medicare costs like coinsurance or copayments. - Premium assistance
Medicare Savings Programs (MSPs) are administered by Medicaid. They can help cover the cost of Part A and Part B premiums, copayments, coinsurance and other costs, depending on the program. - Prescription drug assistance
Original Medicare (Medicare Part A and Part B) does not typically cover prescription drugs. Medicare Part D plans offer prescription drug coverage, however, and are sold by private insurance companies.
You can compare Part D plans available where you live, learn about their Medicare plan ratings and enroll in a Medicare prescription drug plan online when you visit MyRxPlans.com.
If you have Medicaid and Medicare, you’ll automatically qualify for the Medicare Part D Low Income Subsidy (LIS, also called Extra Help) program.
If you are a member of a Medicare Savings Program (more information below), you also automatically qualify for Medicare Extra Help. - Care coordination
Dual eligible beneficiaries (which means you are eligible for Medicare and Medicaid) in certain states are required to enroll in Medicaid Managed Care (MMC). This program helps coordinate your Medicare and Medicaid benefits.
Medicaid administers Medicare Savings Programs (MSP)
There are several types of Medicare Savings Programs (MSPs) that are run by Medicaid.
Qualified Medicare Beneficiary (QMB) Program
The QMB program helps pay your Medicare Part A and Part B premiums, deductibles, coinsurance and copayments.
In order to be eligible, you must meet both of the following criteria:
- Have an income of no more than $1,060 per month as an individual in 2023, or no more than $1,430 per month as a married couple.
- Have resources of no more than $7,730 as an individual in 2023, or no more than $11,600 as a married couple. Countable resources are things like savings accounts or stocks and bonds. Your home and other personal items are not countable resources.
Specified Low-Income Medicare Beneficiary (SLMB) Program
The SLMB program helps pay for Medicare Part B premiums.
Eligibility requires meeting both of the following:
- Monthly income of $1,269 or less as an individual in 2023, or $1,711 or less as a married couple.
- Resources of $7,730 or less for an individual in 2023, or $11,600 or less for married couples.
Qualifying Individual (QI) Program
The QI program is another way to receive help paying for the Medicare Part B premium.
To be eligible, you must satisfy both of the following requirements:
- Income of no more than $1,426 per month for an individual in 2023, or $1,923 per month for a married couple.
- Resources of $7,730 or less for individuals in 2023, or $11,600 or less for married couples.
Qualified Disabled Working Individual (QDWI) Program
The QDWI program is for people who:
- Are disabled but still working
- Lost their premium-free Part A benefits after returning to work
- Are not receiving medical assistance from their state
The program helps pay for the Medicare Part A premium.
The QDWI program is for individuals with a monthly income or no more than $4,249 per month or resources of less than $4,000 in 2024. Married couples may qualify if they have an income of less than $5,722 per month or resources of less than $6,000.
Dual Eligible Special Needs Plans (D-SNPs)
A Dual Eligible Special Needs Plan, or D-SNP, is a certain type of Medicare Advantage (Medicare Part C) plan.
A D-SNP is specifically designed to meet the needs of someone with an income that qualifies them for Medicaid. This includes basic care like doctor’s visits and prescription drugs.
Some plans may include extra benefits that Original Medicare and Medicaid don’t cover.
Medicare and Medicaid Dual Eligibility
“Dual eligible” means being eligible for both Medicare and Medicaid at the same time.
Medicare eligibility requires meeting each of the following:
- You must be at least 65 years old or have a qualifying disability
- You are a U.S. citizen or permanent legal resident
- You are eligible for benefits through Social Security or the Railroad Retirement Board
Medicaid eligibility requirements can differ from one state to the next. But generally speaking, lower income individuals, couples, children and pregnant women are typically eligible.
Contact your state’s Medicaid program to find out the eligibility requirements where you live.
There are two levels of Medicaid and Medicare coverage for those who are dual eligible:
- Full dual eligible
Full dual eligible refers to those who receive full Medicaid benefits and are also enrolled in Medicare. People who are full dual eligible typically receive Supplemental Security Income (SSI), which provides cash assistance for basic food and housing needs.
Qualifying as full dual eligible is based on assets that include checking and savings accounts, stocks, real estate (other than your primary residence) and vehicles if you own more than one. - Partial dual eligible
Partial dual eligible includes those who receive assistance from Medicaid in order to help pay for Medicare premiums or cost-sharing. Partial dual eligible beneficiaries are typically eligible for one of the four Medicare Savings Programs.
Parts of Medicare and private Medicare plans
There are four parts of Medicare that each offer different types of coverage. Medicare Supplement Insurance is also a type of privately sold Medicare plan.
- Medicare Part A
Part A provides coverage for hospital stays and other types of inpatient care. You’re typically required to have Medicare Part A if you also want any other type of Medicare plan. - Medicare Part B
Part B provides coverage for doctor’s visits, other types of outpatient care and durable medical equipment (DME). Part B is optional, though it is typically required in order to enroll in other types of Medicare plans. - Medicare Part C
Medicare Part C is also known as Medicare Advantage. These plans, sold by private insurance companies, provide all of the same benefits as Part A and Part B.
Many Medicare Advantage plans may also provide additional benefits like prescription drug coverage. - Medicare Part D
Medicare Part D plans are also sold by private insurance companies and provide coverage exclusively for prescription drugs. - Medicare Supplement Insurance
Also known as Medigap, these privately-sold plans provide coverage for the out-of-pocket expenses that are tied to Part A and Part B, such as deductibles, coinsurance and copayments.
How do I choose a plan if I’m on Medicare or Medicaid?
When looking for a Medicare or Medicaid plan that best fits your needs, you can consider the following questions to steer you in the right direction.
- Are you eligible for Medicaid?
If you’re dual eligible, a Medicare Savings Program could help you save money on certain Medicare costs.
You can also call to speak with a licensed insurance agent to find out if a D-SNP Medicare Advantage plan is available in your area at TTY Users: 711 24/7. - Would you like additional coverage?
How do you currently pay for dental, vision and hearing care? A Medicare Advantage D-SNP plan that includes these benefits may be able to offer you a more affordable solution.
D-SNP Medicare Advantage plans aren’t available in all areas, and the benefits offered by plans can vary. Call today to speak with a licensed insurance agent who can help you compare the Medicare and Medicaid Dual Eligibility options that are available where you live.
About the author
Christian Worstell is a senior Medicare and health insurance writer with MedicareAdvantage.com. He is also a licensed health insurance agent. Christian is well-known in the insurance industry for the thousands of educational articles he’s written, helping Americans better understand their health insurance and Medicare coverage.
Christian’s work as a Medicare expert has appeared in several top-tier and trade news outlets including Forbes, MarketWatch, WebMD and Yahoo! Finance.
Christian has written hundreds of articles for MedicareAvantage.com that teach Medicare beneficiaries the best practices for navigating Medicare. His articles are read by thousands of older Americans each month. By better understanding their health care coverage, readers may hopefully learn how to limit their out-of-pocket Medicare spending and access quality medical care.
Christian’s passion for his role stems from his desire to make a difference in the senior community. He strongly believes that the more beneficiaries know about their Medicare coverage, the better their overall health and wellness is as a result.
A current resident of Raleigh, Christian is a graduate of Shippensburg University with a bachelor’s degree in journalism.
If you’re a member of the media looking to connect with Christian, please don’t hesitate to email our public relations team at Mike@tzhealthmedia.com.
