I spent last week at AARP in Los Angeles. While I was there, I was able to garner many insights - one of which was regarding Medicare and Medicaid. This is what leads me to my pop quiz.

Question 1: Which of the following statements is true?

1. Medicare and Medicaid are the same program.
2. Medicaid is a state program and Medicare is a federal program, meaning the two programs are not connected in any way.
3. Cost-containment strategies always benefit patients and save the government money.

Answer 1: Actually, it was a trick question. All of the statements above are oft-heard myths about the relationship between these two health insurance programs.

Question 2: Matching: which one describes the eligibility for Medicaid? Medicare?

1. Eligibility determined by any of the following:  65 and over, suffering from kidney failure or long-term kidney disease, or permanently disabled and cannot work.
2. Eligibility determined by low-income and any of the following: pregnant women, children under 19, 65 and over, blind or other disabilities, or those in need of nursing home care.

Answer 2: #1 - Medicare eligibility is determined for individuals over 65, suffering from kidney failure, or permantly disabled. #2 - Medicaid eligibility is determined by low-income and the other eligibility requirements.

Question 3: Which of the following statements describes Medicare?

1. It is a federally funded program.
2. All beneficiaries pay premiums for the service.
3. The program is state and federally funded.
4. Coverage includes hopsitalization, medical, and prescription drug coverage.

Answer 3: 1 & 4. Medicare is a federally funded program where many (but not all) beneficiaries pay premiums for parts of their coverage.  There are programs for "dual eligibles" and a "low income subsidy" for certain beneficiaries.  Medicare is a federal program and all services are offered in all states, yet through Medicare Part D, beneficiaries have a choice for the program they choose for their prescription drug coverage.

Question 4: True of False: Medicaid is only a state program and Medicare is only a federal program - the two programs are not connected in any way.

Answer 4: False - Medicaid is a joint federal and state program, with the federal government subsidizing up to 50% of Medicaid costs in some states. Furthermore, Medicaid and Medicare are connected as more than 9 million Americans are "dual eligibles," meaning they are recipients of both programs. For older Americans eligible for Medicaid, the additional health care coverage often fills the gaps in Medicare and helps offset additional costs.

Question 5: Short Answer: Many cost-containment strategies benefit patients and save the government money.

Answer 5: The reality is that many cost-containment strategies may unnecessarily limit patients' access to medicines and they also don't serve as viable long-term budget solutions. According to a study published in the American Journal of Managed Care, Medicaid cost-containment strategies like preferred drug lists have unintended consequences to patient care--including limiting access to prescription drugs. Moreover, these cost-containment tactics work only in the short-term, as they tend to only shift costs within the system rather than actually make successful, sustainable strides in health care cost reduction.

Stay tuned for more information about Medicare, Medicaid, my thoughts on AARP and recently proposed measures that could have detrimental effects on patient access to prescription medications.