A Guide to Medicaid and Medicare for People With a Disability

When you first apply for disability benefits, you’ll come across a long list of legal and government terms that you may or may not be familiar with. Two names you might have heard before are Medicaid and Medicare — and while they sound similar, these programs have different goals and serve different purposes. 

We’re here to take the confusion out of navigating Medicare and Medicaid for people with disabilities. This guide explains what these programs are, how to utilize them to your benefit, and more handy information about eligibility and application processes.

What is Medicaid?

Medicaid is a joint federal and state government program that provides healthcare coverage to eligible people with limited income and resources. The program is primarily designed to help low-income individuals and families, as well as people with disabilities, with the costs of medical care. If you receive Supplemental Security Income (SSI), there is no waiting period to receive Medicaid.

Medicaid covers a wide range of healthcare services, including doctor visits, hospital stays, prescription medications, nursing home care, and home healthcare. To be eligible for Medicaid, you must meet certain income and asset requirements — which vary by state. If you qualify for SSI — you’ll automatically meet these requirements. 

What is Medicare?

Medicare is a federal government program that provides healthcare coverage to folks aged 65 and over, as well as to younger people with disabilities. It’s funded by taxes and premiums paid by beneficiaries and is administered by the Centers for Medicare and Medicaid Services (CMS). Medicare is not income-based, so all eligible beneficiaries receive the same level of coverage regardless of their income or assets.

Everyone eligible for Social Security Disability Insurance (SSDI) is also eligible for Medicare after a 24-month waiting period. This waiting period starts at your application date, not your approval date. 

Medicare is divided into four parts that each cover different types of healthcare services:

Part A (Hospital Insurance): Covers inpatient hospital care, skilled nursing facility care, hospice care, and some home health care.

Part B (Medical Insurance): Covers doctor visits, outpatient services, preventive care, and some medical equipment and supplies.

Part C (Medicare Advantage): Allows beneficiaries to receive their Medicare benefits through a private insurance plan that contracts with Medicare.

Part D (Prescription Drug Coverage): Covers prescription medications.

Do Medicaid and Medicare overlap?

While both Medicaid and Medicare are government-sponsored health insurance programs, they serve different populations and have different eligibility requirements and coverage options. 

In some cases, you may be eligible for both Medicaid and Medicare. The two programs can work together to provide more comprehensive healthcare coverage. For example, Medicaid may cover Medicare premiums, deductibles, and co-payments for eligible individuals, or it may cover certain healthcare services that are not covered by Medicare. This coordination between the two programs is known as dual eligibility, and it aims to ensure that vulnerable people receive the healthcare services they need.

If you’re eligible for both SSI and SSDI, you can apply for both programs in order to get access to Medicare and Medicaid. Many applicants do this if they meet the income and asset limits for SSI. Doing so affords you Medicaid access while you wait for the 24-month Medicare waiting period to end. 

Qualifying for Medicaid

The eligibility requirements for Medicaid vary by state, but there are some general guidelines that apply across the country.

Income

Your income must be below a certain level, which varies by state and household size. Generally, Medicaid eligibility is based on your Modified Adjusted Gross Income (MAGI), which takes into account your taxable income plus certain deductions. Some states also consider your net income, which includes your income minus certain allowable expenses.

Household size

Your household size is considered when determining eligibility for Medicaid. Generally, if you have more people in your family, you can have a higher income and still be eligible. 

Citizenship or immigration status 

In general, you must be a U.S. citizen or a qualified non-citizen (such as a lawful permanent resident) to be eligible for Medicaid. Each state has its own rules regarding eligibility for non-citizens.

State residency 

You must be a resident of the state where you are applying for Medicaid.

Medical condition 

In some cases, Medicaid eligibility is based on medical needs. For example, individuals with certain disabilities may be eligible for Medicaid regardless of their income.

To get a better idea of your state’s rules surrounding eligibility, you can check out Medicaid’s state overviews here.

Qualifying for Medicare

Medicare is a federal health insurance program that primarily serves people who are 65 or older, as well as people with certain disabilities and end-stage renal disease. To qualify for Medicare, you must meet the following criteria:

Age

You must be 65 years of age or older to be eligible for Medicare. However, in some cases, individuals with certain disabilities or end-stage renal disease may also qualify for Medicare, regardless of age.

Citizenship

You must be a U.S. citizen or a legal permanent resident for at least five continuous years to be eligible for Medicare.

Medicare taxes

If you or your spouse have paid Medicare taxes for at least 10 years while working, you may be eligible for Medicare.

If you meet these eligibility requirements, you will be automatically enrolled in Medicare Part A (hospital insurance) when you turn 65. However, you will need to sign up for Medicare Part B (medical insurance) and Medicare Part D (prescription drug coverage) separately. There may be penalties if you do not enroll in these parts of Medicare when you are first eligible.

It's important to note that Medicare does not cover all healthcare costs. Some services may require you to pay out-of-pocket costs such as deductibles, co-payments, and coinsurance. You can also consider enrolling in a Medicare Supplement insurance policy or a Medicare Advantage plan to help cover some of these costs.

Can I qualify for both Medicare and Medicaid at the same time?

Yes, it is possible to qualify for both Medicare and Medicaid at the same time. As we briefly mentioned before, this is known as being dually eligible, and it applies to individuals who meet the eligibility requirements for both programs.

If you are dually eligible, Medicaid can help cover some of the costs that Medicare doesn't cover, such as co-payments, deductibles, and premiums. Medicaid can also provide coverage for certain services that Medicare doesn't cover, such as long-term care and dental care.

The Centers for Medicare & Medicaid Services has a fantastic explainer about the categories that dually eligible recipients can fall into. But if you have a disability and meet your state’s Medicaid income limits, you’re likely dual eligible. 

We go into more detail about dual-eligibility schemes and programs below.

Special Needs Plans

Special Needs Plans (SNPs) are a type of Medicare Advantage plan designed to provide specialized healthcare coverage for people with certain chronic or disabling conditions, as well as those who are dually eligible for Medicare and Medicaid.SNPs offer tailored benefits and services to meet the unique needs of their members, which can include:

Care coordination: SNPs offer care coordination services to help members manage their healthcare needs and navigate the healthcare system.

Specialized provider networks: SNPs have networks of providers who specialize in treating their members’ conditions.

Additional benefits: SNPs may offer additional benefits that are not available through traditional Medicare, such as dental, vision, or hearing services.

Prescription drug coverage: Most SNPs include prescription drug coverage as part of their plan.

There are three types of SNPs:

Chronic Condition SNPs (C-SNPs): These plans are designed for people with certain chronic conditions, such as diabetes, heart disease, or cancer.

Dual-Eligible SNPs (D-SNPs): These plans are designed for people who are dually eligible for Medicare and Medicaid.

Institutional SNPs (I-SNPs): These plans are designed for people who reside in institutions such as nursing homes or long-term care facilities.

SNPs are available in many areas across the United States but may not be available in all areas. If you are interested in enrolling in an SNP, you can contact Medicare or a licensed insurance agent to learn more about the plans available in your area.

Medicare-Medicaid Plans

Medicare-Medicaid Plans (MMPs) are a type of Medicare Advantage plan that provides all the benefits of both Medicare and Medicaid, including medical, prescription drug, and long-term care services. MMPs are offered by private insurance companies that have contracted with both Medicare and Medicaid.

MMPs coordinate care between Medicare and Medicaid, which can help ensure that dual-eligible individuals receive the most appropriate and effective care. Some of the benefits of MMPs include:

Integrated benefits: MMPs combine the benefits of both Medicare and Medicaid into a single plan, which can help to simplify healthcare coverage and reduce administrative costs.

Care coordination: MMPs offer care coordination services to help members manage their healthcare needs and navigate the healthcare system.

Additional benefits: MMPs may offer additional benefits that are not available through traditional Medicare or Medicaid, such as dental, vision, or hearing services.

Prescription drug coverage: Most MMPs include prescription drug coverage as part of their plan.

MMPs are available in many areas across the United States but may not be available in all areas. If you are interested in enrolling in an MMP, you can contact Medicare or a licensed insurance agent to learn more about the plans available in your area. It's important to note that the rules for MMPs vary by state, so you should check with your state's Medicaid office for specific information on eligibility and coverage.

Program of All-Inclusive Care for the Elderly (PACE)

The Program of All-Inclusive Care for the Elderly (PACE) provides comprehensive healthcare services to older adults who meet the criteria for nursing home care but wish to continue living in their communities. PACE is designed to help seniors maintain their independence and quality of life while receiving the care they need.

PACE is available to people who are 55 years of age or older, eligible for Medicare and Medicaid, and live in a PACE service area. The program provides a wide range of healthcare services, including medical care, prescription drug costs, social services, and rehabilitation services.

The goal of PACE is to provide coordinated, person-centered care that addresses the unique needs of each participant. PACE programs have interdisciplinary teams of healthcare professionals, including physicians, nurses, therapists, social workers, and other specialists, who work together to provide comprehensive care to participants.

PACE programs also provide transportation services to and from medical appointments and other activities. In addition, PACE provides coverage for medical equipment and supplies, including hearing aids, glasses, and mobility aids.

PACE is widely available, but there are some limitations depending on where you live. If you are interested in PACE, you can contact your state's Medicaid office or a licensed PACE provider in your area to learn more about eligibility requirements and the services offered.

How Medicaid and Medicare work with disability benefits

Medicaid and Medicare are both designed to work in conjunction with disability benefits for maximum financial relief. There are two types of benefits available for people with disabilities — Social Security Disability Insurance (SSDI) and Supplemental Security Income (SSI). We’ve written a thorough explainer that breaks down the differences between SSDI and SSI, but the below graphic sums it up easily.

SSDI and Medicare

Social Security Disability Insurance (SSDI) and Medicare work together to provide comprehensive healthcare coverage for people with disabilities. SSDI is a federal program that provides cash assistance to people who are unable to work due to a disability. After being approved for SSDI,  individuals are eligible for Medicare. There is a 24-month waiting period for this eligibility to take effect; the countdown starts ticking at your application date. 

When combined with SSDI, Medicare provides coverage for hospitalization, doctor visits, and other medical services. It also includes coverage for prescription drugs through Medicare Part D.

Once you’re enrolled in Medicare due to receiving SSDI benefits, you are automatically enrolled in Original Medicare. This includes Medicare Part A (hospital insurance) and Medicare Part B (medical insurance). You may also be able to enroll in a Medicare Advantage plan (Part C) or a Medicare Prescription Drug plan (Part D).

If you’re receiving SSDI benefits and are enrolled in Medicare, you may also be eligible for other programs that help to cover healthcare costs. We’ve compiled a guide to all the benefits you may be eligible for while on SSDI.

SSI and Medicaid

SSI (Supplemental Security Income) is a federal program that provides cash assistance to people with low incomes who are disabled, blind, or aged 65 and over. In most states, people who receive SSI benefits are automatically enrolled in Medicaid, which provides healthcare coverage for people with low incomes.

Medicaid covers a wide range of healthcare services, including hospitalization, doctor visits, prescription drugs, and long-term care. It can also provide coverage for home and community-based services, which help individuals with disabilities remain in their homes and communities.

In addition to healthcare coverage, Medicaid can provide other benefits to people with disabilities who receive SSI, such as coverage for transportation, dental care, and vision care. Medicaid can also help to cover the costs of medical equipment and supplies like hearing aids, glasses, and mobility aids.

Conditions that qualify you for disability benefits

Using Medicare and/or Medicaid in conjunction with other benefits can help bring financial relief to those suffering from disability. There are a wide range of conditions that qualify you for disability benefits — so if you’ve always thought that you “weren’t disabled enough” to apply, it’s worth checking. 

We’ve created a comprehensive guide to what medical conditions qualify for Social Security disability as per the Social Security Administration’s (SSA) guidelines, including mental illness. This guide sorts and summarizes the most common conditions that qualify for disability benefits in the U.S., and explains how the SSA evaluates your eligibility. 

Help with more complex questions

At Atticus, we understand that trying to digest all of the information about Social Security Disability Insurance can be a lot. That’s why we’re here — it’s our job to help you navigate the red tape, tricky terms, and legal definitions to get a clearer picture of what you’re eligible for. Our website is full of free resources and handy explainers for everything to do with disability benefits. We can even connect you with a specialist lawyer if you need some extra help with applications and appointments.

Not sure where to start? Take our free quiz to see what benefits you might qualify for.