What’s the Difference Between Medicaid and the Affordable Care Act?

What’s the Difference Between Medicaid and the Affordable Care Act?

Whats the difference between medicaid medicare and the affordable care act

Medicaid is a health care program for low-income individuals that offers them affordable health insurance coverage at a price they can afford, in addition to helping with Medicare premiums and cost sharing payments.

Insurance reform legislation ends the ability of insurance companies to deny coverage or set lifetime dollar limits under specific conditions, as well as cancel policies due to mistakes on applications. In most states, the program also covers prescription drugs.


The Affordable Care Act, commonly referred to as Obamacare, seeks to ensure universal health coverage. This includes Medicare and Medicaid – two government-sponsored programs which offer affordable coverage for low-income individuals – although both programs share some similarities, they each differ significantly in many respects.

The Affordable Care Act introduced several modifications to Medicare. For instance, this law reduced deductibles and coinsurance payments for enrollees while eliminating coverage gaps such as the “donut hole”. Furthermore, hospital payments for uncompensated care were decreased.

The Affordable Care Act also created health insurance exchanges or marketplaces, where private health insurers compete to offer coverage. Legal residents who meet certain criteria are eligible for participation. Furthermore, subsidies help those with lower incomes afford coverage – although open enrollment for coverage ends March 31 each year; you can submit an application at any point throughout the year if need be.


Many states provide health coverage through Medicaid, an affordable health care program for low income families. Services covered under this program may include hospitalization, physician visits, prescription drugs and eyeglasses – not forgetting long-term care services for people living with serious disabilities. It’s a joint federal-state initiative designed to meet basic medical needs at lower income levels – in fact it accounts for almost one-fifth of total healthcare spending!

Political parties overwhelmingly support maintaining and improving Medicaid. Studies demonstrate its benefits; one found it was associated with 19,200 fewer deaths among older low-income adults between 2017-20.

The federal government has laid out general eligibility rules for Medicaid eligibility; however, individual states determine which services will be offered and who should enroll in it. Typically, pregnant women and children whose income falls within mandatory coverage limits; parents whose income falls within eligibility limits for cash assistance programs; as well as seniors and disabled individuals with resources under defined needs limits can qualify for eligibility.

Pre-existing conditions

Before the Affordable Care Act was implemented, private insurers could deny health coverage for people with preexisting conditions or charge them higher premiums and copays. With its implementation, however, these practices were prohibited; now illegal is discriminating against people with preexisting conditions by insurance providers and lifetime caps on care can no longer exist without losing your health coverage when changing providers.

Medicaid is a means-tested public insurance program designed to cover low-income children and adults. Jointly funded by states and the federal government, Medicaid administration resides within individual states. Under the Affordable Care Act (ACA), states had the option of expanding Medicaid eligibility to adults earning less than 133% of FPL – thus making the program widely accessible across the United States.

Research indicates that children eligible for Medicaid are more likely to remain in school, attend college and find meaningful jobs; less likely to develop health issues over time; and their families spend fewer dollars on healthcare bills.

Tax credits

The Affordable Care Act (ACA) includes many features designed to make health insurance more accessible and affordable, such as premium subsidies that help lower-income people buy exchange plans if their income falls within certain thresholds. Furthermore, tax credits help make employer-sponsored policies more cost effective.

Changes brought on by the Affordable Care Act have helped bring down Medicare prescription drug costs. Notably, they ended the “donut hole,” by reducing enrollees’ share of costs in this area and permitting Medicare Advantage plan members to receive discounts from their physician for prescriptions.

The Affordable Care Act has also made Medicaid expansion simpler for states. Although expansion was never mandatory, states that have expanded it have seen significant reductions in uninsured rates and hospital’s uncompensated care costs, while in non-expansion states those costs have actually increased over time. As a result of expansion programs of ACA expansions have helped millions stay healthy, save lives, improve children’s access to health coverage, financial security as well as ensure children receive proper healthcare coverage and assistance with finances.

You May Also Like

About the Author: Raymond Donovan