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Medicare and Medicaid

Medicare and Medicaid

Medicare is a health insurance program that the Federal government funds. It covers people aged 65 years or older, disabled people, and people with stage 5 kidney disease. Both the State and Federal government funds Medicaid. It provides healthcare coverage to low-income adults, pregnant women, children, and disabled people. It is the largest source of funds for medical-related services for Americans with low income.

Medicare and Medicaid differ in several ways. Medicare is funded by the Federal government, whereas Medicaid is funded by both the Federal and State governments (Haas et al., 2019). The Medicare program is the same nationwide, whereas the Medicaid program varies from state to state. Medicare mainly benefits people aged 65 years or older, whereas Medicaid mainly benefits people with low income, pregnant women, and children (Sommers et al., 2019). In Medicare, participants pay for part of the coverage. Participants in Medicaid usually pay little for the coverage. Medicare is divided into four main parts that cover specific services. Medicaid is not divided into various parts.

The two programs have various similarities. They benefit disabled people. They offer to cover the prescription drug costs of the beneficiaries. Furthermore, they offer outpatient and inpatient hospital coverage (Haas et al., 2019). Other services offered by both programs: emergency care, laboratory services, and imaging services, and physician services. They also offer screening and treatment services.

Originally, Medicare referred to a program that provided healthcare services to families of people that served in the military. In 1965, Medicare was enacted under the Social Security Act (Oberlander, 2019). Its main aim was to give health insurance coverage to persons aged 65 years and above. Since then, Medicare has evolved to accommodate the changing needs of society. Examples of societal changes include increasing the number of young persons with disabilities. The number of people with stage 5 kidney disease and those with conditions like Amyotrophic lateral sclerosis has increased. The other evolution is the increase in the number of people who use self-administered prescription drugs. The number of patients with terminal illnesses increased since the enactment of Medicare. There was also the emergence of Health Maintenance Organizations.

The changes in societal needs have facilitated different evolutions in Medicare. The provisions of the program were expanded in 1972 to accommodate benefits for physical and chiropractic therapy (Oberlander, 2019). Hospice benefits for elderly people were added permanently in 1984. In 1997, Medicare Part C was implemented. This allows people with Parts A and B to join the Medicare Advantage plan offered by Health Maintenance Organizations (Oberlander, 2019). The program was also expanded to include young people with disabilities and people with stage 5 kidney disease.

Medicare Part D was fully implemented in 2006, three years after its introduction. Part D helps to pay for self-administered prescription drugs (Oberlander, 2019). In 2010, the Affordable Care Act added free preventive care services to Medicare. The preventative services include mammograms, colonoscopies, and annual wellness visits to doctors.

An evolution in the premium services and tax rates has also been observed. The deductible for Part A increased from $40 annually to $1,184 annually by 2013 (McWilliams et al., 2018). The premium for Part B increased from $3 monthly to $104.90 monthly. This was implemented for people with an annual income of less than $85,000 in 2011 (McWilliams et al., 2018). The rise in Medicare costs is attributed to an increase in medical costs and an increased need for health insurance in the elderly and disabled population. Currently, people can choose between the Original Medicare and the Medicare Advantage Plan. The Original Medicare has three parts: A, B, and D. Hospital insurance is covered in Part A, whereas Medical Insurance is covered in Part B.

Healthcare reform initiatives have different impacts on Medicare and Medicaid. The Affordable Care Act (ACA) is an example of such an initiative. The Act aimed at increasing the availability of affordable health insurance. It also aimed at making the Medicaid program cover people that had an income of less than 138% of the Federal property (Mazurenko et al., 2018). The first implication of ACA on Part D of Medicare was to decrease out-of-pocket costs for cancer patients. ACA provided a $250 check to cover part of the costs of these patients in 2010 (McInerney et al., 2021). Pharmaceutical companies agreed to give the enrollees of Part D a discount of 50% on the total costs of drugs. ACA also eliminated sharing of costs cost-sharing for health preventive services. This enabled the beneficiaries to access free preventive services such as mammograms and colonoscopies.

The ACA increased the premiums of both Part B and D. This applied to people with higher incomes. ACA led to a reduction of coverage costs of prescription drugs for retired people. It led to an enhanced service delivery system for people enrolled in Medicare and qualified for Medicaid. It strengthened the Medicare-Medicaid interface. This was achieved in three ways. The first approach was the standardization of Medicaid eligibility requirements. The second approach was elevating Medicaid reimbursement to attain the level of Medicare (McInerney et al., 2021). The third approach was to create an office that accommodated persons enrolled in both Medicare and Medicaid. This enhanced the Medicare-Medicaid interface.

ACA led to an increase in enrollment among dual-eligible individuals. These expanded Medicaid eligibility standards targeted individuals below 65 years who were not in Medicare Part A or B (McInerney et al., 2021). It also led to the broadening of patient long-term care options. ACA achieved this through coordinated programs. An example of such a program is the Community Living Assistance Services Program.


Haas, D. A., Zhang, X., Kaplan, R. S., & Song, Z. (2019). Evaluation of Economic and Clinical Outcomes under Centers for Medicare & Medicaid Services Mandatory Bundled Payments for Joint Replacements. JAMA Internal Medicine, 179(7), 924–931.

Mazurenko, O., Balio, C. P., Agarwal, R., Carroll, A. E., & Menachemi, N. (2018). The effects of Medicaid expansion under the ACA: A systematic review. Health Affairs, 37(6), 944–950.

McInerney, M., Mellor, J. M., & Sabik, L. M. (2021). Welcome Mats and On-Ramps for Older Adults: The Impact of the Affordable Care Act’s Medicaid Expansions on Dual Enrollment in Medicare and Medicaid. Journal of Policy Analysis and Management, 40(1), 12–41.

McWilliams, J. M., Hatfield, L. A., Landon, B. E., Hamed, P., & Chernew, M. E. (2018). Medicare Spending after 3 Years of the Medicare Shared Savings Program. New England Journal of Medicine, 379(12), 1139–1149.

Oberlander, J. (2019). Lessons from the long and winding road to medicare for all. American Journal of Public Health, 109(11), 1497–1500.

Sommers, B. D., Goldman, A. L., Blendon, R. J., Orav, E. J., & Epstein, A. M. (2019). Medicaid Work Requirements — Results from the First Year in Arkansas. New England Journal of Medicine, 381(11), 1073–1082.


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Medicare and Medicaid

Case Assignment
Watch the following video in preparation for this assignment:

Life: Hindsight 101 (Developer). (2017, July 1). Medicare vs Medicaid: Why you need to know the difference. Retrieved from

Use what you learned from the video, the module’s required readings, and your own research to answer the following questions in your paper.

Medicare and Medicaid

Medicare and Medicaid

  1. Distinguish between Medicare and Medicaid.
  2. Discuss how Medicare has evolved to accommodate the changing needs of society. Do not just go through the timeline – read the materials, think about how society has changed, and explain how Medicare has changed to meet those needs.
  3. Discuss the impact of health care reform initiatives on Medicare/Medicaid.

Length: Submit a 3-page paper, not including the cover page and the reference list.

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