Both Medicaid and Medicare were established on a federal level through the Social Security Amendments of 1965, which were initially signed into law by President Lyndon B. Johnson. Medicaid was intended to provide health insurance for people with low income while Medicare was established specifically for Americans who were 65 years of age or older as well as those with specific disabilities.
The world and healthcare have changed a lot in the intervening half century, but the purpose of both insurance plans remains the same.
Some of the recent advancements in health insurance options, life expectancy and retirement savings strategies have resulted in significant changes to the Medicare system in particular.
When people refer to “Original Medicare”, they’re specifically talking about Medicare Part A and Medicare Part B. Those aspects of Medicare, including hospital insurance and medical insurance, are relatively unchanged in many respects.
Medicare Part C and Medicare Part D
Medicare Part C (Medicare Advantage) and Medicare Part D are much more recent additions. Medicare Advantage was rolled out in 1997 with the Balanced Budget Act to give retirees the option to take advantage of all the benefits of Part A and Part B plus a variety of coverages that weren’t initially included, like dental, vision and hearing insurance. Part C plans are written by private insurers.
Medicare Part D came nearly a decade later with the Medicare Prescription Drug, Improvement, and Modernization Act. Eligible recipients can enroll in standalone Part D coverage or a private Medicare Part C policy with all four parts rolled into one.
The Medicaid landscape is much more complex because the programs are administered by individual states and require complex means testing. Although the program is technically in partnership with the federal government, states have significant leeway in terms of the benefits they offer enrollees and the way in which they administer their programs.
Arizona, like many states, does offer some unique options for duel eligible retirees, most notably the D-Special Needs Plan – or D-SNP.
D-SNP Eligibility and Features
People who are entitled to Medicare Part A, enrolled in Medicare Part B and receive Arizona Medicaid benefits through the Arizona Health Care Cost Containment System (AHCCCS) are eligible for coordinated – or “aligned” – Medicaid and Medicare coverage.
Eligible individuals can visit the Duel Eligible Members page on the AHCCCS website to find the most up to date reference table for plans available in each county.
Which Is Better?
Retirees and people planning for retirement in Arizona are faced with many choices that have significant, long-term ramifications. Your choice of healthcare will likely be one of your most important decisions.
There often is a preferred plan for every retiree or couple, but which is best is highly dependent on your resources, unique care requirements and risks.
An unavoidable limitation inherent with Medicaid of any type is the narrower network of healthcare providers and specialists. Many doctors and hospitals don’t accept Medicaid, which means your options may be limited. While people on Medicaid can usually find specialists to meet their needs, the limited number of doctors may result in long wait times for appointments. Those with Medicare Advantage Plans typically have much broader access to local services and specialists.
With D-SNP, some retirees do have access to more comprehensive care than they may otherwise receive on Medicaid alone, but many of the same limitations can apply.
There are many Medicare Advantage Plans that include wellness programs and perks that retirees won’t find with Medicaid. These types of benefits, if they’re taken advantage of, can have a positive, life-enhancing impact on seniors.
Are You Financially Prepared for Retirement?
While many seniors are relieved to learn about their Medicaid options and plans like D-SNP, most would prefer to avoid that necessity. At Fullerton Financial Planning, we strive to ensure every client has the resources they need to pursue the comfortable life they desire in retirement. A big part of that is having easy access to exceptional local physicians and facilities.
If you have questions about Medicare Advantage Plans or which providers may be right for you, our retirement planners can help. Our team takes a holistic view of retirement, from investment strategies and health insurance to estate planning.
Learn more about your options by calling our advisers at (623) 974-0300.
