American Billing Association — Quick Reference
Medicare vs. Medicaid Billing
Cheat Sheet
Interactive reference — no file download required. Bookmark and use daily.
Medicare and Medicaid are two completely different programs — different payers, different eligibility rules, different fee schedules, different billing forms, and different compliance requirements. Billing errors are common when staff cross-applies rules between the two. This cheat sheet gives you the critical side-by-side differences you need to bill both programs correctly in 2026.
2026 Core Financial Numbers
Medicare Conversion Factor
$33.29
CY2026 Medicare PFS (post-sequestration adj.). Applied to all physician fee schedule services.
Medicare Part A Deductible
$1,676
Per benefit period (hospital admission). No annual maximum — resets with each benefit period after 60 days.
Medicare Part B Deductible
$257
Annual. After deductible met, Medicare pays 80%; patient pays 20% coinsurance (no cap).
Medicare Part B Premium
$185.00
Standard monthly premium CY2026 (IRMAA surcharges apply for income above $106,000 individual).
Medicaid Cost-Sharing
Nominal
Federal law caps cost-sharing at nominal levels for most mandatory populations. Many states = $0 copay for certain services.
Medicaid Income Threshold
138% FPL
ACA expansion states: Medicaid eligibility at 138% FPL (~$21,597 individual in 2026). Non-expansion states: varies widely.
Side-by-Side: The Most Important Differences
Medicare (Federal)
Who Administers It
CMS federally — uniform nationwide rules
Who Is Eligible
65+ OR disabled (receiving SSDI 24 months) OR ESRD/ALS
Billing Form
CMS-1500 (professional) or UB-04 (institutional)
Payer ID
Varies by Medicare Administrative Contractor (MAC) by state/region
Timely Filing
365 days from date of service (1 year). No exceptions. CO-29 denial = permanent.
Fee Schedule
Medicare Physician Fee Schedule (MPFS) — uniform nationally with GPCI geographic adjustments
Payment Speed
Electronic: 14-day payment floor. Paper: 29-day floor (statutory minimums).
Appeals Process
5 levels: Redetermination (120 days) → Reconsideration (180 days) → ALJ ($180 threshold) → MAC → Federal Court
Enrollment
PECOS (Provider Enrollment, Chain and Ownership System). 855B/855I forms. Revalidation required every 5 years.
Advance Beneficiary Notice
ABN required before providing non-covered/possibly non-covered services. CMS Form CMS-R-131.
Medicaid (State-Federal)
Who Administers It
State agencies within federal minimum standards — rules vary significantly by state
Who Is Eligible
Low-income individuals/families, pregnant women, children (CHIP), disabled. Criteria vary by state.
Billing Form
CMS-1500 (professional) or UB-04 (institutional) — same forms; payer-specific requirements vary
Payer ID
State Medicaid agency or Managed Care Organization (MCO) — each has its own payer ID
Timely Filing
VARIES by state and MCO. Range: 90 days (some MCOs) to 365 days. Must verify for each state where you practice.
Fee Schedule
State-specific Medicaid fee schedule. Typically lower than Medicare. Managed Medicaid MCOs may have separate contracted rates.
Payment Speed
Federal standard: states must pay clean FFS claims within 12 working days (for states meeting the standard). Managed Medicaid: MCO-specific.
Appeals Process
State-specific. Typically: internal appeal → state fair hearing → state administrative appeals. Federal Medicaid court action available.
Enrollment
State Medicaid provider enrollment — separate from Medicare/PECOS. Most states require state-specific enrollment + credentialing.
Notice to Patients
Medicaid beneficiaries generally cannot be billed for covered services. No ABN equivalent — different notice requirements apply.
Dual-Eligible Patients — The Most Common Billing Mistake
Critical rule: Dual-eligible patients (enrolled in both Medicare and Medicaid) must ALWAYS have Medicare billed first. Medicaid is always the payer of last resort by law. Billing Medicaid first for a dual-eligible is a HIPAA violation and creates overpayment liability.
| Dual-Eligible Category | What They Get | Billing Order | 2026 Medicare Low-Income Subsidy |
|---|---|---|---|
| Full Dual Eligible (QMB, SLMB, QI) |
Full Medicare + full Medicaid benefits | 1st: Medicare | 2nd: Medicaid picks up cost-sharing | QMB: Medicare pays all cost-sharing (copays/deductibles). Cannot bill QMB patients for Medicare cost-sharing. |
| Qualified Medicare Beneficiary (QMB) | Medicare + Medicaid pays Part A/B premiums + cost-sharing | 1st: Medicare | 2nd: Medicaid/state pays balance | Provider cannot charge QMB patients any Medicare copay, coinsurance, or deductible — even if the claim crosses to Medicaid and Medicaid pays $0. |
| Specified Low-Income Medicare Beneficiary (SLMB) | Medicare + Medicaid pays Part B premium only | 1st: Medicare | 2nd: Standard Medicare cost-sharing applies (patient owes unless also QMB) | Part B premium ($185/mo) paid by Medicaid. Patient still owes standard Medicare cost-sharing. |
| Medicare Savings Program (MSP) | Varies by MSP category | 1st: Medicare always | 2nd: State MSP program | Verify current MSP income thresholds in your state — updated annually. 2026 thresholds set by each state. |
HETS verification for dual eligibles: The Health Eligibility Transaction System (HETS) allows providers to verify Medicare/Medicaid dual-eligible status in real time via 270/271 eligibility transactions. Verify at every visit — Medicaid status can change monthly.
Timely Filing Windows — Medicare & Selected Medicaid by State
| Program | Timely Filing Limit | Special Rules |
|---|---|---|
| Medicare (FFS) | 365 days from date of service | CO-29 denial = permanent, not appealable. Exception: late filing due to MSP/COB discovered after billing. |
| Medicare Advantage Plans | Minimum 365 days (CMS requires MA plans to allow at least 1 year from DOS) | Many MA plans extend to 365+ days; check individual plan contracts. MA plans cannot have shorter TFL than traditional Medicare. |
| California Medi-Cal | 365 days from date of service | Medi-Cal Managed Care plans may have shorter TFLs; check individual plan. |
| Texas Medicaid | 95 days from date of service | One of the shortest TFLs in the country. Texas Medicaid MCOs may vary. Verify for each MCO. |
| Florida Medicaid | 12 months (365 days) | Florida Medicaid MCOs typically follow 365-day rule; verify each plan. |
| New York Medicaid | 90 days from date of service (fee-for-service) | NY Medicaid managed care plans may differ. Retroactive claims: up to 24 months for retroactive eligibility determinations. |
| Illinois Medicaid | 180 days from date of service | Exceptions for retroactive eligibility. MCO plans may have shorter windows. |
| Pennsylvania Medicaid | 180 days from date of service | Retroactive eligibility: 180 days from eligibility determination date. |
| Ohio Medicaid | 365 days from date of service | Ohio managed care organizations vary; check individual MCO contracts. |
| Georgia Medicaid | 365 days from date of service | CMOs (Managed Care Organizations) in Georgia: 180 days unless contract specifies otherwise. |
Always verify state-specific Medicaid TFLs. Medicaid timely filing rules are set by each state and change without major announcement. The only authoritative source is the current state Medicaid provider manual for your state. MCO plans within the state may have shorter TFLs — check every MCO contract separately.
Key Coding Differences: Medicare vs. Medicaid
| Topic | Medicare Rule | Medicaid Rule |
|---|---|---|
| HCPCS Level II Codes | Uses both CPT (Level I) and HCPCS Level II. Some services only covered under HCPCS (e.g., DME, drugs, specific services). | Uses CPT and HCPCS Level II. Some state Medicaid programs have state-specific HCPCS codes not used by Medicare. |
| Modifier LT/RT (laterality) | Required for bilateral procedure reporting in many contexts. Also used to prevent NCCI bundling errors for bilateral surgeries. | Same requirement but verify state-specific Medicaid manual — some states have different laterality requirements. |
| Telehealth Billing | POS 02 (non-originating facility telehealth) or POS 10 (patient home). Audio-only under G2251/G2252 codes (temporary extension). Medicare Part B covers telehealth under specific categories. | Varies widely by state. Some states cover audio-only, some require video. Place of service and originating site rules differ by state. Check state Medicaid telehealth policy — many changed post-COVID waiver expiration. |
| Mental Health Parity | Mental Health Parity and Addiction Equity Act (MHPAEA) applies to Medicare Advantage. Traditional Medicare applies its own MH benefit structure. | Medicaid must comply with MHPAEA for managed care plans. FFS Medicaid: federal minimum standards for MH services apply; states vary significantly. |
| Preventive Services | Covered under the ACA with no cost-sharing (annual wellness visit, immunizations, cancer screenings with "A" or "B" USPSTF rating). | EPSDT (Early Periodic Screening Diagnostic and Treatment) is mandatory for children under 21. Coverage is comprehensive and broader than commercial plans. Adults: varies by state benefit package. |
| Assignment of Benefits | Participating providers must accept assignment (agree to Medicare's allowed amount as payment in full). Non-participating: may balance-bill up to 115% of Medicare allowed amount. | Medicaid providers cannot balance-bill Medicaid patients for covered services under any circumstances. The Medicaid rate is payment in full. |
| Prior Authorization | Required for specific Medicare Part B services (some imaging, DME, PT/OT/ST). Medicare Advantage plans have extensive PA requirements — verify at plan level. | PA requirements set by state and MCO. Medicaid managed care plans expanded PA requirements significantly in 2024–2025. Verify current PA list for each MCO you contract with. |
10 Billing Mistakes That Switch Between Medicare and Medicaid
- Billing Medicaid first for a dual-eligible patient — Always bill Medicare first. Medicaid is always the payer of last resort. This is federal law, not a preference.
- Balance-billing a Medicaid patient — Medicaid patients cannot be billed for covered services beyond the Medicaid rate. Billing them the balance is prohibited and can result in termination from the Medicaid program.
- Billing a QMB patient for Medicare cost-sharing — Qualified Medicare Beneficiaries: you cannot bill them for any Medicare deductible, coinsurance, or copay — even if Medicaid sends you a $0 remittance.
- Using Medicare PA approval to substitute for Medicaid PA — Each program has its own PA requirements. Medicare approval doesn't satisfy Medicaid PA requirements and vice versa.
- Applying Medicare TFL to Medicaid claims — Medicaid TFLs are state-specific and often much shorter. Never assume 365 days applies to Medicaid.
- Using wrong payer ID for Medicaid MCO — Medicaid managed care plans have different payer IDs than the state FFS Medicaid program. Verify the specific MCO payer ID before submitting.
- ABN for Medicaid patients — Medicare's Advance Beneficiary Notice (CMS-R-131) does not apply to Medicaid patients. Different notice rules apply. Medicaid patients cannot be asked to sign an ABN as a condition of service.
- Assuming Medicare and Medicaid fee schedules are similar — Medicaid typically pays 60–80% of Medicare rates depending on the state and service. Never use Medicare rates to estimate Medicaid reimbursement.
- Using Medicare enrollment (PECOS) to satisfy Medicaid enrollment — These are separate enrollment systems. PECOS enrollment does not make you enrolled in Medicaid. You must enroll separately with the state Medicaid agency.
- Applying Medicare telehealth rules to Medicaid telehealth — Telehealth coverage, originating site requirements, and allowed codes differ significantly between Medicare and Medicaid, and Medicaid varies by state.
Pre-Submission Checklist: Dual-Program Claims
- Verified correct program for this patient (Medicare FFS, Medicare Advantage, Medicaid FFS, or Medicaid MCO — each is a different payer)
- For dual-eligible patients: confirmed Medicare is billed first MEDICARE FIRST
- Confirmed correct payer ID for this specific plan (not just "Medicare" or "Medicaid" — each MAC and MCO has its own payer ID)
- Timely filing limit — confirmed the TFL for this specific payer from its 2026 provider manual
- Prior authorization — verified PA requirement for this service under this specific plan for 2026 (both programs expanded PA lists in 2025)
- Place of service code — correct for where care was actually delivered and matches program rules (especially telehealth)
- Provider is enrolled with this specific payer (Medicare enrollment and Medicaid enrollment are separate)
- For Medicaid: service is covered under this state's benefit package and/or MCO contract
- For Medicare: ABN completed if service may be non-covered (not required/applicable for Medicaid)
- Balance-billing rule confirmed: Medicaid patients cannot be billed beyond Medicaid rate for covered services; QMB patients cannot be billed for Medicare cost-sharing
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