Medicaid with Medicare Part B

Medicare Part B covers medical benefits, such as physician services, outpatient care, durable medical equipment, home health services, some outpatient "Part B" medications, some laboratory tests, and many preventive services.

People eligible for Medicaid who are also covered by Medicare Part B may have all or a portion of their co-insurance and deductible amounts paid by Medicaid.  Test strips, lancets, and needle disposal systems are covered under the Medicare Part B durable medical equipment (DME) benefit, and Medicaid will pay the cost share of covered home health supplies after Medicare Part B provides a paid response.

Pharmacies must follow the coordination of benefits process when billing claims to Medicaid. The pharmacy must submit the claim to Medicare prior to submitting to Medicaid for payment consideration. Medicaid is the payer of last resort.  This includes claims for Part B covered drugs for people with qualified Medicaid beneficiary (QMB) benefits. Medicaid will reimburse up to the maximum payable Medicaid amount.  If the amount paid by Medicare is greater than the maximum payable Medicaid amount, the claim will pay at zero dollars.

If Medicare Part B provides a paid response, the pharmacy should process the Medicaid claim to result in one of the following:

  • The claim is paid with a $0.00 paid amount; Medicaid will cover the cost share (co-insurance, copay, deductible) up to the Medicaid allowed amount.
  • The claim is paid with an amount greater than $0.00, but less than the Medicaid allowed amount for identified drugs covered by Medicaid; Medicaid may cover the cost share portion up to the Medicaid allowed amount.  Pharmacies may not request payment directly from the Medicaid-eligible person.