Medicare and Medicaid look very similar in prose, and both are government programs aimed at helping Americans pay for healthcare. But the make up – costs, benefits, and eligibility – are much different. Here is the difference between the two: Medicare – Medicare provides health care to residents (U.S. citizens and permanent legal residents) who have lived continuously in the country for five years or more and are age 65 or older. People under 65 may qualify if they meet the following requirements: have received 24 months of Social Security disability benefits or a pension from the Railroad Retirement Board, have permanent kidney failure, or have Lou Gehrig’s disease. You might be familiar with Medicare if you’ve studied your pay stub before. Medicare is a part of the Federal Insurance Contributions Act (FICA) tax. The rate which you and your employer are both responsible for paying, is 1.45%, with a surtax of .9% for employees making over $200,000.Medicaid – Medicaid provides healthcare services to low-income individuals and families. Jointly run at the state and federal level, Medicaid covers the cost associated with custodial and or long-term care for qualifying recipients. Certain services - i.e. dental or optometry visits - may not be covered based on what state you’re in. While Medicare is funded through payroll taxes, states and the federal government fund Medicaid. The federal government pays states for a specified percentage of program expenditures, called the Federal Medical Assistance Percentage (FMAP), which varies by state. It is also possible for some people to qualify for Medicaid and Medicare, if they meet the requirements for both.
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