“Part A” and “Part B” are actually Medicare terms, not Medicaid. These two programs are easy to mix up because their names are so similar, but they work very differently. Medicare is federal health insurance primarily for people 65 and older, while Medicaid is a joint federal and state program for people with low incomes. If you searched for “Medicaid A and B,” you’re most likely looking for an explanation of Medicare Part A (hospital insurance) and Part B (medical insurance), or you want to understand how these two programs differ. This guide covers both.
Why the Confusion Happens
Medicare is divided into labeled parts: Part A, Part B, Part C, and Part D. Medicaid has no such lettering system. Instead, Medicaid is a single program with a list of mandatory and optional benefits that varies by state. So when people search for “Medicaid Part A and B,” they’re almost always thinking of Medicare’s two core components, which together form what’s called Original Medicare.
Medicare Part A: Hospital Insurance
Part A covers inpatient care. That means stays in hospitals, critical access hospitals, and skilled nursing facilities. It also covers hospice care and some home health services. Most people don’t pay a monthly premium for Part A if they or their spouse paid Medicare taxes for at least 10 years while working.
The key word with Part A is “inpatient.” If you’re admitted to a hospital overnight, Part A kicks in. If you need short-term rehabilitation in a skilled nursing facility after a qualifying hospital stay, Part A helps cover that too, typically for up to 100 days. It does not, however, cover long-term nursing home care indefinitely. That distinction matters and is where Medicaid often steps in (more on that below).
Medicare Part B: Medical Insurance
Part B covers outpatient care and preventive services. This is the side of Medicare that pays for doctor visits, lab work, ambulance services, mental health treatment, durable medical equipment like wheelchairs or oxygen tanks, and limited outpatient prescription drugs. It also covers preventive care designed to catch illness early, such as screenings and flu shots.
Unlike Part A, Part B requires a monthly premium. After you meet your annual deductible, you typically pay 20% of the Medicare-approved amount for most services. That 20% coinsurance has no cap, which is why many people add supplemental insurance or a Medicare Advantage plan to limit out-of-pocket costs.
How Medicaid Actually Works
Medicaid doesn’t use a Part A/Part B structure. Instead, the federal government sets a floor of mandatory benefits every state must offer, and states can then add optional benefits on top. The result is that Medicaid coverage looks different depending on where you live.
Services Every State Must Cover
Federal law requires all state Medicaid programs to cover inpatient and outpatient hospital services, physician visits, nursing facility care for adults 21 and older, home health services, lab and X-ray work, family planning, and transportation to medical appointments. Children enrolled in Medicaid receive a comprehensive package of screening, diagnostic, and treatment services. Nurse midwife and nurse practitioner services, medication-assisted treatment for substance use disorders, and freestanding birth center services are also mandatory.
Services States Can Choose to Add
Many of the benefits people associate with Medicaid are technically optional at the federal level, meaning individual states decide whether to include them. These include prescription drugs, dental care, eyeglasses, physical therapy, occupational therapy, speech therapy, prosthetics, dentures, hospice care, personal care services, and mental health services in certain institutional settings. In practice, nearly all states cover prescription drugs and many of these other services, but the scope and limits vary widely.
Medicaid Costs for Enrollees
Medicaid is designed to serve people with limited income, so out-of-pocket costs are far lower than Medicare’s. States have the option to charge premiums, copayments, coinsurance, or deductibles, but federal rules cap these amounts. For people with incomes at or below 150% of the federal poverty level, copayments are limited to nominal amounts. Emergency services are exempt from all out-of-pocket charges regardless of income.
Certain groups are shielded even further. Children, pregnant women, and people living in nursing facilities are exempt from most cost-sharing. States can charge somewhat higher copayments to enrollees with incomes above 150% of the poverty level, including up to 20% of the cost for non-preferred prescription drugs, but those situations are the exception rather than the rule.
Long-Term Nursing Home Care
One of the biggest practical differences between the two programs is long-term care. Medicare Part A covers short-term stays in a skilled nursing facility after a hospital admission, but it does not pay for ongoing custodial care in a nursing home. Once Medicare’s skilled nursing benefit runs out, patients either pay privately, use long-term care insurance, or, if they’ve exhausted their assets and meet income requirements, transition to Medicaid coverage.
Medicaid is the largest payer of nursing home care in the United States. To qualify, the nursing home must be licensed and certified by the state as a Medicaid nursing facility. Each state sets its own criteria for determining whether someone needs that level of care. In some states, people applying for nursing facility residence may qualify for Medicaid under higher income limits than those used for community-based coverage. People with serious mental illness or intellectual disability go through an additional screening to confirm that nursing facility admission is appropriate.
When People Have Both: Dual Eligibility
About 12 million Americans are enrolled in both Medicare and Medicaid at the same time, making up more than 15% of all Medicaid enrollees. This group includes 7.2 million low-income seniors and 4.8 million people with disabilities. For these “dual eligible” individuals, services covered by both programs are paid first by Medicare, and Medicaid fills in the remaining costs up to the state’s payment limit.
Medicaid can also help dual-eligible individuals pay for Medicare premiums and other out-of-pocket expenses. If you qualify for Medicare but struggle to afford the Part B premium or the 20% coinsurance, Medicaid may cover some or all of those costs depending on your income and the state you live in. This layered coverage means dual-eligible individuals typically pay very little out of pocket for medical care.
Quick Comparison
- Medicare Part A: Federal hospital insurance for people 65 and older (and some younger people with disabilities). Covers inpatient hospital stays, short-term skilled nursing, hospice, and some home health care. Most people pay no premium.
- Medicare Part B: Federal medical insurance covering doctor visits, outpatient care, preventive services, and medical equipment. Requires a monthly premium and 20% coinsurance on most services.
- Medicaid: Joint federal-state program for people with low incomes. No Part A/B structure. Covers a broad range of services including long-term nursing home care. Out-of-pocket costs are minimal or zero depending on income and state rules.
Eligibility for Medicaid is based on income, generally calculated as a percentage of the federal poverty level. States that expanded Medicaid under the Affordable Care Act cover adults with incomes up to 138% of the poverty level. States that did not expand have more limited eligibility, often restricted to specific categories like pregnant women, children, and people with disabilities.