Medicaid

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Medicaid is a state and federally run health program for families with low income who do not have the resources available to get their own family health insurance. Although funded by both state and federal governments, Medicaid is fully managed by the states. All 50 states have different Medicaid eligibility requirements which can make it difficult for families to understand if they can in fact participate in the Medicaid program.

Medicaid is the largest source of funding for medical and health related services for people with limited income in the United States. With the new requirements saying every American has to have health insurance, Medicaid is the most likely option for some families who do not have a family health insurance program.

How Medicaid Works

Medicaid is simple enough to understand. First, a family or individual meets the Medicaid eligibility requirements. The most common requirements focus around the economic status of an individual, a person’s physical or mental ailments, and if they have dependents. Once a family or individual has received the approval of their state’s Medicaid program, they will be accepted into the program and receive an approval letter in the mail along with their membership card.

Medicaid does not simply hand out money. The Medicaid program pays your medical bills by directly paying your health care provider. In some states individuals might be required to pay a co-payment along with the covered amount. This is typical in almost all insurance programs.

Medicaid Eligibility

A common misconception is that Medicaid is for “poor people”. This is an inaccurate statement.

The Medicaid eligibility requirements are given by each state, and therefore differ by state. However, there are certain mandatory eligibility groups. These include:

• Limited income families with children who meet certain of the eligibility requirements in the state’s Aid to Families with Dependent Children plan
• Supplemental Security Income (SSI) recipients
• Infants born to Medicaid-eligible pregnant women
• Children under age 6 and pregnant women and infants whose family income is at or below 133% of the federal poverty level
• Recipients of adoption assistance and foster care
• Certain individuals with Medicare
• Special protected groups who may keep Medicaid for a period of time

There is of course more information on these Medicaid eligibility requirements, but these are the general federally mandated groups who can receive Medicaid. There are also optional Medicaid eligibility groups. Many of the optional groups are stipulations on the mandatory rules or those who have mental and/or physical disabilities. Some of the optional Medicaid eligibility groups are as follows:

• Infants up to age 1 and pregnant women not covered under mandatory rules whose family income is below 185% of the federal poverty level
• Certain aged, blind or disabled adults who have incomes above those requiring mandatory coverage, but below the federal poverty level
• Children under 21 who meet income and resources requirements for the Aid to Families with Dependent Children
• Institutionalized individuals with limited income and resources
• Recipients of state supplementary payments

“Medically Needy” or “Spending Down” for Medicaid

If you’ve heard these terms being tossed around before about Medicaid but were confused about the meaning, you are not alone. These terms basically mean the same thing; they both allow Medicaid to extend eligibility to people who have too much income to qualify for the traditional Medicaid coverage. A person would qualify for this if their medical and/or remedial care expenses offset the excess amount of income.