6 frequently asked questions about Medicare and Medicaid

Health insurance is a program that protects an individual against the costs associated with medical as well as surgical expenses.

How can a person purchase health insurance?

• An individual can choose between different kinds of health insurance policies.
• In America, as per the statistics of the National Health Interview Survey, 65% of the individuals in the country aged below 65 years have private health insurance.
• Individuals can also purchase health insurance as social insurance or social welfare funded program that is operated by the government.
• In such health insurance policies, resources are pooled, and the risk of financial expenditures for medical services are distributed among the entire population to ensure that every person is protected.

What is Medicaid?

• It is the largest health insurance program that pays for the medical expenses of low-income citizens of our country.
• The Health Insurance Association of United States of America defines Medicaid as a government health insurance program for individuals of all ages, whose resources and income are not sufficient to pay for the required medical services.

Who is eligible to apply for Medicaid?

• A person is eligible to apply for Medicaid if they meet the federal income as well as standard assets norms, and also fit into the specified eligibility criteria.
• Today, Medicaid covers pregnant women and children.
• Families with unemployed parents are also eligible for Medicaid.
• However, families who have recently lost Medicaid coverage as a parent has attained employment can remain insured for one year.

What is Medicare?

• Medicare is a national health insurance program.
• The centers of Medicare and Medicaid of Federal Government of United States of America undertake the administration of this program.
• It began under the Social Security Administration in the year 1966.
• Medicare receives its funding from a combination of premiums and surtaxes from beneficiaries, payroll taxes, as well as other revenues.

Who is covered by Medicare?

• Under its health insurance coverage come those individuals who are 65 years and above, and have worked and paid into this system by contributing through payroll taxes.
• Medicare also extends its coverage to those individuals who have specific disabilities as determined by Social Security Administration.
• Further, the coverage of this health insurance program extends to individuals who have end-stage renal disease, which is a permanent kidney failure that requires either a transplant or regular dialysis.

What are the various parts of Medicare?

• Hospital insurance/Medicare Part A: This Medicare plan covers the in-patient treatment in a professional nursing home, hospice care, stay at a hospital, and other home health care treatments.
• Medical insurance/Medicare Part B: This part of Medicare covers some services of the doctor, outpatient care, prevention services as well as other medical supplies.
• Medicare Advantage Plans/Medicare Part C: This is a type of medical health plan provided by a private company contractually linked with Medicare. This health insurance plan covers the benefits provided by medical insurance and hospital insurance. Part C also includes a health maintenance organization, fee for service plan, special needs plans, preferred provider organization and also Medicare medical savings account plans.
• Prescription drug coverage/Medicare Part D: This part of Medicare provides coverage for specific Medicare costs, original Medicare, certain Medicare fee for service plans, and Medicare medical savings account plans.