Has anyone ever asked you if you “sell Medicaid plans,” and you’ve had to correct them and explain that you actually sell Medi-care plans? Maybe you’ve even been asked to explain the differences between the two!
Often confused with each other due to the similarities in their names and aims, Medicare and Medicaid are two separate government-funded health programs for American citizens. Understanding the differences in these two institutions and how they can work in tandem will help insurance agents ensure each unique client coverage need is met.
Medicare vs. Medicaid
Medicare is the federal health insurance program for qualifying Americans over 65 years old, or under-65 individuals who meet certain disability requirements. This group of insured individuals are predominantly senior citizens, over the age of 65, which is also when Americans begin earning their Social Security Disability Income or Railroad Retirement Benefits and their Medicare Parts A & B coverage. There is no income limitation or requirement that would inhibit someone’s ability to enroll in Medicare.
Medicaid is another health insurance program, but it’s run by both the federal government and individual state governments and is usually only available to people who have lower incomes. Since local governments have their say, the requirements, regulations, and funding for Medicaid depend on each state or commonwealth. For example, individual income levels that qualify someone for Medicaid coverage in one state may not be the same as in another.
Typically, states with lower income thresholds for Medicaid recipients usually have smaller economies, and therefore, receive more federal funding. Federal law classifies certain individuals into mandatory eligibility groups, which states must follow. However, states are given more flexibility in how to dictate where and to whom this funding goes in comparison to Medicare, which is solely governed by the federal regulations of the Centers for Medicare & Medicaid Services (CMS) and is uniformly regulated nationwide.
States are given more flexibility in how to dictate where and to whom this funding goes in comparison to Medicare, which is solely governed by the federal regulations of CMS
What notably sets Medicaid apart from Medicare is that there isn’t any age minimum associated with this coverage. Medicare recipients are automatically eligible for coverage after turning 65 years old, but Medicaid recipients can be eligible at any age. In fact, due to the wider availability of Medicaid coverage, one in five Americans are recipients of this insurance.
Due to the wider availability of Medicaid coverage, one in five Americans are recipients of this insurance.
Medicaid can also cover more services than Medicare, such as additional prescription coverage, long-term care, and more. Essentially, when Medicare isn’t able to cover a certain service or doesn’t cover a large enough share of coverage of said service, Medicaid may fill in the gaps and help lower out-of-pocket costs. These costs could range from premiums, to copays, long-term care costs, and more, as Medicaid is the “payer of last resort” and will always be applied after Medicare and any other insurance has already paid their maximum portion.
If you’re wondering how you can assist your clients with enrolling in Medicaid, checking for eligibility is a simple process! Healthcare.gov has a quick tool that anyone can use to determine their Medicaid eligibility based solely on income. If they don’t qualify based on income eligibility, your client should still apply if they’re disabled or have other qualifying circumstances because they could still be entitled to Medicaid coverage! This coverage can be applied for through the Health Insurance Marketplace or directly through your state’s Medicaid agency. Even if your client doesn’t end up with Medicaid insurance coverage, this program could still help your Medicare beneficiaries in other ways!
Examples of how this help is given include Medicare Savings Programs (MSPs) and Extra Help. Medicaid funds these programs, as an MSP will directly pay for overhead Medicare costs, such as deductibles or the Part B premium, rather than being true Medicaid coverage. If your client qualifies for an MSP due to their low income level, then they would automatically be enrolled into the Extra Help program as well, which will help with the cost of their prescriptions and Medicare Part D.
Federal Medicaid funding doesn’t just provide insurance coverage to individuals or families. This money is also used by states to support infrastructure, such as hospitals or community centers, and staffing for physicians, nurses, home health care, and other entities for communities that serve a high population of Medicaid beneficiaries.
Medicare for Medicaid Recipients
For agents, Medicaid beneficiaries present a unique opportunity to provide the right plan for folks who may need more comprehensive coverage than the average client. Medicare clients who also qualify for Medicaid are in a rare position, where they are eligible for more diverse and frequent Special Enrollment Periods (SEPs) than typical Medicare clients, as well as special types of low-cost plans that not all Medicare recipients are eligible for.
Medicare clients who also qualify for Medicaid are in a rare position, where they are eligible for more diverse and frequent SEPs than typical Medicare clients.
Dual eligible special need plans (D-SNPs) are low or no-cost plans that exist to give beneficiaries of both Medicare and Medicaid comprehensive and affordable coverage and can have a dramatic impact on their quality of health care and life. In addition, these plans can be sold year-round, as dual-eligible beneficiaries are eligible for an SEP once during each quarter outside of AEP to change plans. This increases the possibility of lock-in sales and forming close bonds through repeated business with these clients.
Furthermore, those eligible for the Extra Help program are also granted an SEP that allows them to change their prescription drug plan (PDP) or Medicare Advantage Prescription Drug Plan (MAPD) once per month. This creates another special opportunity for agents to strengthen their relationship with their clients by offering them an array of products should they find they need to switch plans.
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As we’ve covered, clients who receive Medicare and Medicaid coverage present more sales opportunities than standard Medicare clients who may only be eligible for enrollment when they turn 65, during AEP, or with less frequent, need-based SEPs. Maintaining a portfolio of high-quality products that include plan options for dual-eligible clients like MAPD, PDP, and D-SNP plans will set you up for successful sales. You’ll be equipped to meet the needs of this more vulnerable and unique portion of the insurable population.