Medicaid eligibility varies from state to state, but in all states, Medicaid provides health coverage for some low-income families, children, pregnant women, the elderly, and people with disabilities. In some states, however, the program covers all low-income adults below a certain income level.
Some states may choose to cover other groups, such as individuals receiving home and community-based services and children in foster care who are not otherwise eligible.
The implementation of the Affordable Care Act (ACA) of 2010 expanded Medicaid coverage to include nearly all low-income Americans under the age of 65. Eligibility for children was extended to at least 133% of the federal poverty level (FPL) in every state, and states were given the option to extend eligibility to adults with income at or below 133% of the FPL. Most states have chosen to expand coverage to adults, and those that have not yet expanded may choose to do so at any time.
The ACA also changed the way income eligibility for Medicaid is computed. Provision of Medicaid is based on the Modified Adjusted Gross Income (MAGI), which is used to determine financial eligibility for Medicaid, the Children’s Health Insurance Medicaid (CHIP), and premium tax credits and cost sharing reductions available through the health insurance marketplace.
This process made it easier for states to administer Medicaid since all states now use one set of income counting rules and a single application across all programs. This in turn made it easier for people to apply and enroll for Medicaid in their respective states.
The MAGI-based system primarily uses taxable income and tax filing as basis to determine Medicaid eligibility. However, some individual are exempt from the MAGI-based methodology. These individuals include persons with disabilities and people aged 65 and older.