“Obamacare” plans are private plans; Medicaid is government-run coverage
The most important difference between Medicaid and Obamacare is that Obamacare health plans are offered by private health insurance companies while Medicaid is a government program.
Medicaid, the government health insurance program for low-income United States residents, is a social welfare program like SNAP food stamps or Temporary Assistance to Needy Families.
The term Obamacare is typically used to describe private health insurance purchased through the Affordable Care Act’s health insurance exchanges.
Obamacare health insurance plans are offered by health insurance companies such as Blue Cross, Kaiser Permanente, Molina, Aetna, Humana, Wellpoint, and others. Obamacare health plans are not run by the government.
It’s worth noting, however, that more than three-quarters of Medicaid enrollees nationwide are on Medicaid managed care plans, which means that their insurance is administered by private insurers that also sell commercial insurance to individuals and businesses. Those plans operate via a contract with the state government to provide Medicaid benefits.
It’s more difficult to get Medicaid than it is to get an Obamacare health plan.
If you’re a legal resident of the United States, you can buy an Obamacare private health insurance plan through your ACA health insurance exchange as long as you’re not eligible for Medicare. If your income is from 100% to 400% of federal poverty level, you may qualify for a subsidy that helps pay part of your monthly health insurance premiums (note that the lower threshold for subsidy eligibility is 138 percent of the poverty level in states that have expanded Medicaid; in those states, Medicaid is available to people with income up to 138 percent of the poverty level).
If your income is above 400% of FPL, you won’t get help paying for the health insurance sold on Obamacare exchanges, but you may buy an Obamacare plan anyway. In this case, you’ll be responsible for paying 100% of the monthly premium yourself.
The criteria to get Medicaid are strict and vary from state to state. The original intent of the ACA was that all legal residents with incomes up to 138% of FPL would get Medicaid coverage for free. However, a Supreme Court decision made complying with this part of the Affordable Care Act optional. This resulted in a confusing system in which some states have very strict Medicaid eligibility criteria because their leaders chose not to expand Medicaid coverage, but other states have more lenient Medicaid eligibility criteria because their leaders opted into the ACA’s Medicaid expansion.
In most instances, Medicaid does not require much in the way of copayments, coinsurance, or deductibles. Since Medicaid is intended for those with very low incomes, anything other than token small amounts of cost-sharing would be unaffordable to Medicaid recipients and present a potential barrier to care.
On the other hand, Obamacare health plans do come with deductibles, copayments, and coinsurance. Since a deductible of several thousand dollars can be difficult for people with modest incomes to pay, there is a cost-sharing subsidy available to those making less than 250% of FPL that helps to decrease these cost-sharing expenses. Those making more than 250% of FPL are responsible for the full amount of any cost-sharing required by their Obamacare health plan.