What Is Medicaid?

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Written by Rapid Bio Labs; Edited by Yhordan Serpentini | August 29, 2022

If you have ever been, or are currently, in a position where you need medical or wellness care, but unfortunately did not have the financial support needed, you might want to look into your eligibility for Medicaid, as well as its benefits.

You might be asking yourself: “what is medicaid?” To put it simply, Medicaid is a national public health insurance program available to individuals with limited incomes. It provides financial assistance for medically necessary and wellness services. While it is a national, federal service, each state oversees its own Medicaid program. Currently, about one out of every five Americans is covered by Medicaid.

Today, we’re going to discuss who can qualify for Medicaid and what kinds of assistance it offers its beneficiaries.

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Who Is Eligible for Medicaid?

To qualify for Medicaid, you must have an income that falls below a certain limit. Those income limits vary based on the state, and they typically change annually. In addition, you must belong to one of the following groups of people:

● Pregnant women
● Children under the age of 19
● Adults with children or a caregiver
● The elderly or disabled
● Refugees within the first eight months of arriving in the United States

As we mentioned, each state can set its own income limits for Medicaid eligibility. However, the federal government did set basic ground rules, which states can choose to follow or not. The Affordable Care Act also expanded Medicaid coverage for those individuals and families who fall below 133% of the Federal Poverty Level. Again, it’s up to each state to choose to follow that expansion.

The Federal Poverty Level, or FPL, is set by the U.S. Department of Health and Human Services. It’s calculated by determining the total cost needed per person to cover basic necessities like food, shelter, and utilities. As an example, the 2022 FPL for a family of four is $27,750. (This excludes Alaska and Hawaii, which have different FPLs.)

What Services Does Medicaid Cover?

The Medicaid program has specific laws in place that determine the wellness and other healthcare services the states must cover. Mandatory benefits include things like inpatient and outpatient hospital services, periodic screenings and diagnostic tests, nursing facility and home health services, physician services, family planning, pediatric and family nurse practitioner services, transportation, and federally qualified health center services.

In addition, states can choose to include optional benefits such as prescription drugs, physical and occupational therapy, respiratory care services, podiatry, optometry, dental care, eyeglasses, hospice, prosthetics, chiropractic services, inpatient psychiatric services, case management, and more.

How Much Does Medicaid Cost?

States can choose to impose deductibles, copayments, and coinsurance amounts on their Medicaid beneficiaries. The dollar amount that can be charged varies by income. Federal rules prohibit the states from charging monthly premiums for Medicaid beneficiaries whose income is below 150% of the FPL. They also prohibit or limit cost-sharing for some groups and services and limit out-of-pocket costs to 5% or less of their family income.

Some states have gotten waivers to allow them to charge higher premiums and cost-sharing amounts than what is stated in the federal rules. Most of the waivers target adults who are eligible due to the ACA’s Medicaid expansion, but some target even the more traditionally-eligible beneficiaries.

Individuals with limited incomes can also apply to other federal or state programs. Special programs are in place for Medicare-eligible individuals (typically age 65 and older), which can reduce their cost-sharing even more. The Children’s Health Insurance Program (CHIP) offers very low premiums for eligible children .

You’ll need to visit your state’s website to get a list of all the financial assistance programs they offer. There, you’ll also be able to see the Medicaid eligibility guidelines, which should help you determine if you qualify.

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