Learn About Medicaid Programs and Eligibility Requirements

What Is Medicaid and How Does It Work

Medicaid is a health insurance program run by state and federal governments together. It pays for medical services for people with lower incomes and certain other circumstances. Unlike Medicare, which is based on age or disability, Medicaid is primarily based on how much money a person or family makes. Each state runs its own Medicaid program, which means rules and what services are covered can be different from state to state.

The program started in 1965 and has grown to cover millions of people. In 2023, Medicaid covered roughly 72 million Americans. The federal government provides funding and sets broad rules, but states have flexibility in how they design their programs. This means a person living in one state might have access to different services than someone in another state, even if their income is the same.

Medicaid pays doctors, hospitals, and other healthcare providers directly for the care they give to people covered by the program. When someone with Medicaid goes to a doctor who accepts Medicaid, they typically do not pay the bill themselves—Medicaid handles the payment. Some services may require a small copay (a small amount the person pays), but these are usually very low or zero for people with the lowest incomes.

The program covers many types of medical care, including doctor visits, hospital stays, prescription medicines, mental health services, and dental work. The exact list of covered services varies by state. Some states are more generous with what they cover than others. This variation is important to understand because it means the services available in your state may differ from what is covered in a neighboring state.

Practical Takeaway: Medicaid is a partnership between state and federal governments that provides health insurance to people with lower incomes. Because each state runs its own program, the rules and covered services vary by location. Understanding that your state's program may be different from others helps set realistic expectations about what services may be available to you.

Income Limits and Financial Thresholds

Income limits are one of the main factors that determine whether someone may participate in Medicaid. These limits are set by each state and change periodically. Income limits are usually expressed as a percentage of the Federal Poverty Level (FPL). The FPL is a measure of income set by the federal government that changes each year based on inflation.

In 2024, the federal poverty level for a single person was about $15,060 per year, and for a family of four it was about $31,200 per year. Many states set their Medicaid income limits at or near the poverty level, meaning people earning around this amount or less may be considered within the income range for the program. However, some states set higher limits. For example, some states allow people earning up to 200% or even 300% of the poverty level to participate in Medicaid.

States that expanded Medicaid under the Affordable Care Act (also called the ACA or Obamacare) typically have higher income limits than states that did not expand. As of 2024, 38 states plus Washington D.C. have expanded Medicaid. In these expansion states, adults without children can often earn up to about 138% of the federal poverty level and still participate. In non-expansion states, income limits for adults without children tend to be much lower, sometimes as low as 0-50% of the poverty level.

Income is not the only financial measure considered. Many programs also look at assets (things a person owns, like savings or a car). Asset limits vary widely by state and by type of Medicaid program. Some programs have no asset limit, while others do. Understanding your state's specific income and asset limits is important because they determine whether you fall within the range the program considers.

Practical Takeaway: Your income must fall below your state's specific limit to participate in Medicaid. These limits vary significantly by state and are often expressed as a percentage of the federal poverty level. Knowing your state's exact income threshold is a first step in understanding whether you may fit within the program's parameters.

Categories of Medicaid Coverage

Medicaid covers different groups of people through different categories or pathways. Understanding which category might apply to you helps clarify what rules and income limits would be relevant. The main categories include children, pregnant people, parents and caretakers of children, seniors, and people with disabilities.

Children represent the largest group covered by Medicaid. Almost all states cover children in families with incomes up to at least 133% of the federal poverty level, and many states cover children up to much higher income levels—sometimes 200-300% of poverty. This broad coverage of children exists because Medicaid was originally designed in part to ensure that children had access to preventive care and treatment.

Pregnant people and new parents are another major category. Medicaid covers pregnant people in all states, typically up to 133% of the federal poverty level at minimum, though some states cover up to much higher income levels. Coverage often continues for a period after birth, though the exact length varies by state. In some states, coverage for new parents extends only 60 days after birth, while in others it may last longer.

Seniors (people 65 and older) and people with disabilities are also major categories. However, seniors typically need to have limited income and assets to participate, and they may need to be eligible for Medicare first. People with disabilities can participate in Medicaid at various income levels depending on which specific disability program they are in. Some people are "dually eligible" for both Medicare and Medicaid.

In expansion states, there is also a category for non-disabled, non-elderly adults without children. This category opened the program to many adults who previously would not have been covered. The income limit for this group is usually around 138% of the federal poverty level.

Practical Takeaway: Medicaid covers different groups through different categories. Each category has its own income limits and rules. Identifying which category applies to you—whether you are a child, a pregnant person, a senior, a person with a disability, or an adult without children—helps you understand what rules and limits would apply in your state.

Work Requirements and Special Circumstances

Some states have added work requirements to their Medicaid programs in recent years. A work requirement means that certain people must work, be in job training, do volunteer work, or be engaged in other activities to remain covered by Medicaid. Work requirements do not typically apply to children, pregnant people, people with disabilities, or seniors. They most commonly apply to non-disabled, non-elderly adults.

As of 2024, about a dozen states have work requirements or similar rules in place or pending. The specifics vary by state. Some require 20 hours of work per week, while others require more. Some activities count toward the requirement, such as paid employment, self-employment, job training, volunteer work, and in some cases, caregiving for family members. States with these requirements typically have reporting requirements, meaning people must document their work or activities to remain covered.

There are exceptions built into most work requirement programs. Caregivers (such as parents caring for young children), people experiencing homelessness, people with medical conditions that limit their ability to work, and people in certain other situations may be exempt. However, the process for requesting an exemption varies by state and can be complex.

Other special circumstances that may affect Medicaid participation include immigration status, whether you live in a state that expanded Medicaid, whether you are receiving other benefits (such as Supplemental Security Income or SSI), and whether you are in school or undergoing vocational training. Some of these circumstances may make you more or less likely to be within a program's parameters, while others may determine which specific Medicaid program you would be in.

People experiencing homelessness have special considerations in many states, including sometimes relaxed documentation requirements. People in institutions (such as nursing homes or prisons) also have different coverage rules than people living in the community. Understanding your specific circumstances and how they fit within your state's rules is important.

Practical Takeaway: Work requirements and other special rules exist in some states. These do not apply to everyone—children, pregnant people, seniors, and people with disabilities are typically exempt. If you are a non-disabled adult of working age, learning whether your state has a work requirement and what it entails is important for understanding how to maintain coverage.

Services Covered and Variations by State

Medicaid covers a broad range of health services, but