Medicare and Medicaid are related programs, but they are not the same policy. Medicare exists to give older Americans and disabled American coverage. Medicaid is designed to provide temporary assistance to needy families and disabled individuals who cannot afford health insurance otherwise.
In most cases the overlap between the two programs comes from the same funding source. The same bill created both of them. The federal government oversees Medicare, but each state operates its own Medicaid program.
Some people qualify for both the Medicare and Medicaid programs, although these are usually elderly people with limited incomes. Patients in nursing homes may be covered under both programs, although they may use up their lifetime Medicare benefit for skilled nursing care facility coverage.
If the programs overlap in this manner, the care facility will bill both programs, although in many cases by the time this occurs, a person’s financial resources are completely exhausted. There are situations where this is not the case.
Both programs are facing fiscal problems. The CATO institute identifies Medicaid and Medicare spending as the largest part of the federal budget. Less fiscally-conservative groups place it as the second largest part of spending, although it still outweighs defense spending overall.
Medicaid and Medicare overlap in another way because both programs are going bankrupt. Health care reform has not changed this as there are too many people drawing from the programs and not enough people paying in. Meaningful reform means reducing costs and reducing spending. This may or may not come by reducing the the number of people eligible for both programs.
Beyond these items there is not much overlap between the two programs. One is needs-based and the other is an entitlement for people who are over 65 years old. Medicaid is also cheaper to the recipient than Medicare is in most situations.