What is the Difference Between the Medicare and Medicaid Programs?

What is a medical assistance program?

State and federal programs that provide assistance to individuals who need help with health care coverage are commonly referred to as medical assistance programs. Millions of people rely on these programs each and every day to cover costly medical expenses. The two most common medical assistance programs are Medicaid and Medicare.

Key differences between Medicare and Medicaid

It is understandable that these two national health insurance programs are often times mistakingly used interchangeably. They are both health care assistance programs and their spellings are very similar. Despite the similarities, there is a clear distinction between the two. That distinction lies in the target populations that they are designed to serve.

In broad terms, Medicare is a federal health care program that provides coverage to individuals who are 65 years or older. Medicare also provides coverage for individuals who are under 65 and have a qualifying disability. Medicaid, on the other hand, is a state and federal health care program that provides coverage for individuals who are low income.

Both of these programs are governed by the Centers for Medicare and Medicaid, or CMS, which is a federal agency under the umbrella of the United States Department of Health and Human Services. CMS administers the Medicare program and is the partner federal organization that states work with for Medicaid.

Individuals who are eligible for both can be covered by both programs at the same time to cover more costs and provide the most advantageous coverage.

What is Medicaid?

Medicaid is a federal medical assistance program that aids low-income and disabled individuals. In fact, it is the largest source of funding for health services for low-income individuals as it provides free health care to nearly 23% - nearly 71 million! - of Americans. Medicaid was created as part of the Social Security Amendments of 1965 which provided for federal funds to match state funding for individuals whose resources were able to cover the cost of medical expenses.

Individual states manage their own Medicaid programs, therefore, the qualifying criteria for eligibility can vary greatly. Over 60% of Medicaid beneficiaries are enrolled in some sort of privately managed care plan meaning that Medicaid is a prime example of a partnership that brings together the federal government, state governments, and private industry.

Medicaid, unlike Medicare, is a means-tested and needs-based program. With Medicare, the primary determining eligibility requirement is age while Medicaid is focused on the individual’s available resources.

Medicaid saw a drastic expansion as a part of the Affordable Care Act (ACA). This resulted in an estimated 11 million more individuals qualifying than previously would not have. A United States Supreme Court ruling in 2012 clarified that states could not have their federal matching funds for Medicaid eliminated if they didn't expand under the ACA. Because of this, many states opted to not extend their coverage. All 37 states chose to extend benefits.

Children are by far the largest group of enrollees in the Medicaid system. The program also helps nearly 60% of all nursing home residents and 37% of all childbirths in the United States.

What is the Medicaid waiver program?

Federal guidelines have provided an avenue for states to develop community-based services waivers (HCBS waivers) to better meet the long-term care goals of individuals who prefer to seek care in their own community or home as opposed to a hospital or institutional setting. The waivers must target a specific group and states are able to operate as many waivers as they wish.

The Medicaid website outlines the four criteria for waivers under federal guidelines. The waiver programs must:

• Demonstrate that providing waiver services won’t cost more than providing these services in an institution.
• Ensure the protection of people’s health and welfare
• Provide adequate and reasonable provider standards to meet the needs of the target population
• Ensure that services follow an individualized and person-centered plan of care

Some of the services of care that are often covered under these waivers include case management, home health aides, adult day health services, personal care, and respite care.  While these are the most common, states are able to propose other types of care that they believe will help individuals which is a unique feature of the waiver program. Essentially, these HCBS programs give states the ability to tailor resources to more specialized groups.

Types of Medicaid managed care plans

An unfortunate reality that our society currently faces is the increasing frequency with which families are seeking managed care for their loved ones. It is a complicated and time-intensive process and requires a fair amount of knowledge about how the healthcare system works. The federal government’s Medicaid website is a great resource for all topics related to Medicaid managed care.

It is absolutely understandable that managed care is sought out so frequently given the complex nature of medical assistance programs. In addition to caring for a loved one, the added stress of navigating government programs can take its toll. Managed care plans can be a great asset.

There are three types of Medicaid managed care plans: comprehensive risk-based plans, primary care case management, and limited-benefit plans.

• Comprehensive risk-based plans: These are by far the most common of the managed risk plans and likely the plans that most Americans have had some experience with. These plans are similar to health maintenance organizations (HMO) models in that states provide a static amount of funding to qualified health plans for each plan enrollee. If the total cost of the benefits and services provide extend beyond that funding, the plan is responsible for the balance.
• Primary care case management: In these plans, enrollees are assigned a primary care physician who is reimbursed a fixed amount per enrollee. The disbursed funds are meant to compensate the primary care physician for the coordination of the enrollee’s care. This is a great option for enrollees who have a physician that may be uniquely familiar with their particular set of circumstances.
• Limited-benefit plans: These plans are designed to provide funding for one specific type of benefit. Most often, these plans are used for instances of mental health, substance abuse services, transportation, and dental services.

What are the requirements to be eligible for Medicaid

 The guidelines for Medicaid eligibility are complicated at best. In general, applicants must fall into one of the following categories to be eligible:

• Low-income children
• Pregnant women
• Parents of Medicaid-eligible children
• Low-income disabled individuals
• Low-income seniors (65 years or older)

There are a host of other criteria that factor into Medicaid eligibility. The CMS website is a great resource for understanding these factors.

How to apply for Medicaid

Medicaid is a federal and state government partnership. Matched funding is provided by the federal government but the actual administration of the health plan and services is facilitated by individual states. Applications for Medicaid should be conducted through the various state Medicaid offices. One stipulation that is common to the various state programs is that potential enrollees must be residents they applying in and wish to receive aid.

Children and Medicaid

An interesting feature of Medicaid is that children can be eligible for Medicaid even when their parents are not. Many times, a parent’s income is too high to qualify for Medicaid but too low to qualify for private insurance. In these instances, the Children’s Health Insurance Program, or CHIP, is available to help bridge that gap and provide the necessary insurance coverage for uninsured children up to the age of 19 years old.

The CHIP program doesn’t require enrollment during a traditional open enrollment program which allows parents to enroll children in need any time of year.

What is Medicaid case management?

As we discussed earlier, the world of Medicaid is layered and complicated. For those who are entering the world of medical assistance programs for the first time or for those who just want the best care they are able to get for themselves or a loved one, it can help to have a guide.

Medicaid case management is a service that helps Medicaid enrollees make the most of the opportunities afforded to them for medical, educational, and social services.  Case managers are industry professionals who have a variety of tools and resources available to advocate on their client’s behalf with the hope of providing the services that are best suited to these individuals. Case managers have a good understanding of the community and local services that are available to their enrollees making them uniquely positioned to maximize the care of their clients.

Case managers will work with clients to identify specific goals and needs and then develop a plan to achieve those goals.

Comprehensive Medicaid case management software for nonprofits

One of the primary tools that Medicaid case managers use to ensure the highest quality care for their clients is comprehensive Medicaid case management software. PlanStreet is an industry-tested case management system that can help Medicaid waiver providers address billing needs, scheduling of services, invoicing, and identifying and correcting organizational inefficiencies.

PlanStreet’s case management software’s strengths include:

• Efficiency: tools to assess how staff’s time and resources are being used and how they can be maximized to help clients the most.
• Invoicing: provides in-the-moment looks at payment authorizations and pending invoices so that a clear and accurate financial picture is available.
• Flexibility: PlanStreet works with all Medicaid waiver types including Level 1, individual options, and self-waivers.
• Scheduling: The ability to automate staff schedules, manage time, and keep track of client meetings.
• Payroll: Keeps track of billable vs non-billable hours and efficiently tracks payroll hours.

PlanStreet excels in its ability to be flexible and adapt to new processes and regulations. The world of Medicare and Medicaid is not only a big one but it is one that experiences change frequently. The rules and regulations that govern the management of these programs are revisited and revised constantly in an effort to make them more efficient and accountable. Because of this, Medicaid case management services need to be prepared to adapt quickly. Planstreet’s Medicaid program software is flexible and can be fitted to fit individualistic needs. Flexibility is a tremendous advantage with Medicaid programs specifically as there are 51 different sets of rules governing their implementation.

Another major advantage of using PlanStreet for your Medicaid case management is the ability to centralize work processes and information. Today’s offices are largely virtual so the ability to access the information you need anytime and anywhere you need it is a growing necessity. PlanStreet is a common workspace where client data, documents, and schedules are at the fingertips of anyone in the organization.

Threads in the fabric of healthcare

Since their inception, Medicaid and Medicare have become essential threads in the fabric of the American healthcare system. A significant portion of the population depends on them for the most basic of services. Managed care is increasingly more common. As these programs grow in usage, they also become more and more complex. A good understanding of their operation is critical but so is having the right tools to help clients navigate the healthcare landscape. A flexible Medicaid case management software is indispensable and PlanStreet more than fits the bill.