According to the Centers for Medicare & Medicaid Services, U.S. adults ages 65 and over each spent $22,356 on personal health expenses in 2020. That’s almost 2.5 times higher than expenses for younger adults ($9,154).

How can you pay those expenses? Medicare and Social Security benefits cover some costs, and those with savings and long-term care insurance can use them to pay for health expenses.

If you need more help, those on Medicare (and any eligible individual) with very limited financial resources may qualify for Medicaid to pay for health costs not covered by Medicare. 

Approximately 13 million people received health coverage under both Medicare and Medicaid in 2021, according to KFF analysis. These individuals are considered “dual-eligible” and qualify for partial or full Medicaid benefits in addition to Medicare.

Eligibility requirements for Medicare and Medicaid

Anyone 65 or older can qualify for Medicare, but to qualify for partial or full Medicaid benefits, you need to meet income and asset requirements.

The income limits for partial Medicaid benefits (such as Medicare Savings Programs] are based on the federal poverty level.

These are the limits, in 2024, to receive partial benefits from Medicaid, which may include coverage of any premiums for Medicare Parts A and B, as well as any co-pays or deductibles for services and items covered by Medicare:

• Individual monthly income limit: Ranges from $1,275 to $1,715. Asset limit: $9,430
  Income limits are slightly higher in Hawaii and Alaska.
• Married couple monthly income limit: Ranges from $1,724 to $2,320. Asset limit: $14,130

For the partial benefit calculation, income includes monthly Social Security payments, says  Alice Burns, the Associate Director of the Program on Medicaid & Uninsured at KFF. Assets include money in a checking, savings, or retirement account, as well as stocks and bonds. States typically exempt other types of assets, including your home, one car, a burial plot, up to $1,500 for burial expenses, furniture, and other household items.

Income limits for full Medicaid vary both across and within states. Most commonly, they are based on Supplemental Social Security Income (SSI), which limits people to $943 per month in income and up to $2,000 in savings and other financial assets.

The services covered also vary by state, says Burns, and may include long-term nursing home care, home health care services to help with daily living activities, dental and vision care, and more.

If you’re not sure if you qualify, consider getting some assistance. “I always recommend contacting an attorney who specializes in geriatrics and the state Medicaid rules,” says Diane Omdahl, author of Medicare for You and cofounder of the Medicare advisory firm 65 Incorporated.

Non-financial eligibility requirements

In addition to meeting the financial requirements, Medicaid beneficiaries typically must be residents of the state where they receive Medicaid. They must also be U.S. citizens or lawful permanent residents.

To learn the Medicaid eligibility requirements for your state, check with your state Medicaid agency.

Types of plans for those who are dual-eligible

Both traditional Medicare and Medicare Advantage plans can be paired with Medicaid for those who are dual-eligible. In addition, a growing number of people are signing up for Medicare Advantage plans created specifically for those who are dual-eligible.

According to KFF, 5.2 million dual-eligible individuals were enrolled in Medicare Advantage Dual-Eligible Special Needs Plans (D-SNPs) in 2023. D-SNPs generally provide benefits not offered through traditional Medicare and typically charge no premiums.

Omdahl recommends checking the network of available providers before signing up for a D-SNP.