Who Pays First in Medicare?

Medicare Benefits Solutions
Sep 30, 2021

Who Pays First in Medicare? Both the Medicare and Medicaid programs serve as crucial resources for healthcare access in America. While these programs are governed at the federal level by the Centers for Medicare & Medicaid Services (CMS), they are administered on the state level to some degree. This means that all Medicare and Medicaid programs have certain overall limitations and minimums regarding coverage, but plans can differ depending on what state you live in.

Coverage from dual programs

Although both programs are separate, some people may be eligible to receive benefits from both at the same time. Individuals who qualify for both Medicare benefits and Medicaid coverage are sometimes referred to as dual-eligibles.

In order to be considered for dual-eligible status, you will still need to qualify for both programs according to each standard. This means that you will need to be at least 65 or have a qualifying disability and still be at or under the income threshold for your state’s Medicaid program.

Who pays first when you have Medicare and Medicaid?

In the case of dual-eligibles, payment questions often come up since many people are unclear as to which program pays first for medical care. The first responsible entity is known as the primary payer while the secondary entity often referred to as the supplemental payer.

Medicare is typically the primary payer when it comes to coverage for dual-eligibles; however, this can become more complicated when you involve things like private insurance in addition to Medicare and Medicaid. Depending on the circumstances, private insurance may be billed first.
Different states have varying rules that apply toward Medicaid benefits and the usage of Medicare benefits. 

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Eligibility for Medicare

In order to qualify for Medicare, you need to be at least 65 years old or have certain disabilities under the age of 65. For most people, enrollment in Medicare Part A is automatic and free. Contributions paid into Medicare over your working life are made through payroll deductions. These contributions cover the premium for Medicare Part A, the inpatient or hospital benefit.

If you have not contributed enough to receive premium-free Medicare Part A, you can obtain this coverage by paying a monthly premium upon enrolling. Medicare Part B, on the other hand, is optional coverage and requires a monthly premium payment as well. Medicare Part D is prescription drug coverage and is also optional coverage.

Eligibility for Medicaid

Unlike Medicare, Medicaid does not have an age requirement in order to receive benefits. Even with this being the case, Medicaid eligibility is based on low income and limited resources. Instead, states impose income limits on individuals who apply for Medicaid. If your income surpasses the threshold for your state’s Medicaid program, you will not be eligible for benefits.

If you receive Medicaid, you may be subject to a yearly review of your income. If changes in income have taken place since your last review, your benefits may change or your eligibility status may change.

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