Medicaid is a U.S. government-operated healthcare program that helps low-income individuals and families obtain medical care.
Around 91 million Americans are covered under Medicaid and enjoy free or low-cost doctor’s visits, hospital stays and long-term care in the form of stays at nursing homes or assisted living facilities (ALFs).
Although Medicaid is funded in part by the federal government, it is administered differently in each state. Read on to find out who is covered under Medicaid, the difference between Medicaid and Medicare, how Medicaid differs from state to state and how to apply for Medicaid.
Who Does Medicaid Cover?
The main purpose of Medicaid is to assist certain low-income individuals and families with healthcare costs, but restrictions vary depending on where these individuals live.
Therefore, in order to qualify, a person or family must not earn more than a set amount of money. How much they can earn and still qualify is calculated by their income rate as compared to the federal poverty level (FPL).
Specific groups that may enroll in the program include:
- Children under the age of 19 in low-income families
- People of all ages with certain disabilities.
- Some covered disabilities include cerebral palsy, autism, Down syndrome, bipolar disorder, and quadriplegia, among others.
- Recipients of SSI (Social Security Income).
- These individuals automatically qualify for Medicaid in most states.
- Pregnant women who are uninsured.
If your state chose to expand Medicaid after the Affordable Care Act (ACA) was signed into law, then you may be able to enroll based solely on income.
What Does Medicaid Cover?
Medicaid covers doctor’s visits, inpatient care, laboratory tests, X-ray services and even long-term health care costs. Often, Medicaid will provide 100% coverage in these areas.
States also have the option of covering prescription drugs under their Medicaid program. If you are over 65, however, you can also enroll in Medicare and opt to receive Part D (drug coverage), which will be subsidized by Medicaid.
What Is the Difference Between Medicaid and Medicare?
On account of their similar names, Medicaid and Medicare are often confused with one another.
Both Medicaid and Medicare were introduced back in 1965 as part of President Lyndon Johnson’s “Great Society” program, but since then have morphed and expanded.
While Medicaid and Medicare could be thought of as sister programs (especially since both are administered by the same agency within the U.S. Department of Health and Human Services), they are quite different. One of the biggest differences between them involves eligibility.
Medicare and Medicaid Eligibility
The simple difference between the two programs is that Medicare is for people 65 and older, regardless of income, while Medicaid is for people who have low incomes. There are some exceptions to this rule that makes the comparison a bit more complicated than that, but if you can remember this you’ll know the primary difference between the two.
It is actually possible to qualify for both Medicare and Medicaid. Such people are referred to as being “dual-eligible.”
Another very significant difference between Medicare and Medicaid is that, while Medicare is a federal program, Medicaid is both a federal AND state program. This gives states a much bigger say when it comes to expanding Medicaid eligibility to additional groups of people.
Medicaid as a State Program
Since Medicaid is administered by individual states, this means you could be eligible for Medicaid in one state but not in another state.
The specific groups referenced above — children under 19, people with certain disabilities, pregnant women and SSI recipients — are “mandatory eligibility” groups. This simply means that states must cover them in accordance with federal law.
However, states also have the option of expanding eligibility to low-income individuals even if they do not have a disability or meet any of the other requirements mentioned previously.
When it comes to who is considered “low income,” states again have the option to set their own income limits as long as they meet the federal government’s minimum requirements.
In 2023, for example, 48 states (all besides Alaska and Hawaii) and the District of Columbia consider the federal poverty level (FPL) to be $14,580 for a single person. The poverty levels for Alaska and Hawaii are higher ($18,210 and $16,770 respectively) because these states have a higher cost of living.
Additionally, each state uses a different cutoff based on that federal poverty level in order to determine who is eligible for Medicaid. For example, one state may only offer Medicaid to individuals who made no more than 110 % of the FPL, while another state may extend coverage to those who make up to 200% of the FPL.
What If Your State Expanded Medicaid?
Under the Affordable Care Act (ACA, also known as “Obamacare”), states were initially required to expand Medicaid. This means that anyone who earned less than 133% of the Federal Poverty Level (FPL) would qualify for the program, regardless of their age, health condition, etc.
However, the Supreme Court determined that the ACA did not have legitimate authority to impose this rule across the country and that each state must decide whether they wanted to expand their programs in this way or not.
Since then, many states have chosen to adopt the ACA’s Medicaid expansion, but many others have not.
If you live in a state that has opted to expand its Medicaid program, it makes figuring out whether or not you qualify a lot simpler. If you live in a state that has not opted to expand Medicaid, however, you may need to meet the disability, age or pregnancy requirements discussed above.
How to Apply for Medicaid
If you think you may be eligible for Medicaid benefits, there are a few ways you can apply.
First, you can apply through your state’s individual Medicaid website. Since Medicaid may be based partly on your income, your state may allow you to apply for several other government programs at the same time, including food stamps (SNAP), cash assistance (TANF) and more.
Another way to apply for Medicaid is to do so through the federal Health Insurance Marketplace. The marketplace will then send your application to your state’s Medicaid agency.
Keep in mind that Medicaid does not have an open enrollment period — since it is a government assistance program, you can apply all year long.
