What is the lowest and highest income to qualify for Medicaid?
The eligibility threshold for Medicaid, which strives to provide healthcare coverage for low-income individuals, varies from state to state.
Many Americans still lack healthcare insurance despite the Medicaid expansion under the Affordable Care Act, which increased the income thresholds to qualify for Medicaid. In 2020, US Census Bureau data showed that 28 million people, or around 8.6 percent of the US population, did not have health insurance at any point during that year.
There are 12 holdout states that still haven’t expanded Medicaid leaving over 2 million people in the “coverage gap”. This is a situation where they earn too little to qualify for subsidized health plans on the Affordable Care Act insurance exchanges, but don’t meet their states income requirements for Medicaid.
Medicaid income thresholds vary by state
Medicaid is a health insurance program that is funded jointly by federal and state governments which strives to help low-income individuals have access to healthcare. It was established to provide medical coverage to children, parents, pregnant women, the elderly and the disabled who have limited income.
Although the federal government sets some basic ground rules, each state can choose whether to cover more healthcare services than those mandated. The Affordable Care Act allocated funding for states to expand coverage to all adults with income up to 133 percent in excess of the Federal Poverty Level, but due to the way it is calculated it turns out to be 138 percent.
All states, the District of Colombia, and US territories offer Medicaid, although participation is optional. Likewise, states could choose to participate in the Medicaid expansion which 12 have decided not to. States can set their own income thresholds higher, or in the case of the non-expansion states lower, which, along with other factors, means that there is no uniform income threshold from state to state to qualify for Medicaid.
Federal Poverty Level thresholds to qualify for Medicaid
The Federal Poverty Level is determined by the size of a family for the lower 48 states and the District of Columbia. For example, in 2022 it is $13,590 for a single adult person, $27,750 for a family of four and $46,630 for a family of eight. To calculate for larger households, you need to add $4,720 for each additional person in families with nine or more members.
The Federal Poverty Level, which the Department of Health and Human Services determines, is higher in Alaska and Hawaii. The amount is adjusted each year to take into account inflation and takes effect 1 January.
The percentage of a household’s income to qualify for Medicaid, besides varying by state, is also higher or lower depending on who it is for. Many states that expanded Medicaid coverage have set income limits for both parents and single adults at 138 percent of the Federal Poverty Level.
The District of Columbia has the highest income limits set at 221 percent for a family of three and 215 percent for a all other adults. Texas, which hasn’t expanded Medicaid coverage, has the lowest threshold to qualify at 16 percent for a family of three. Pregnant women and children tend to have much higher income thresholds to qualify.
The income threshold percentage can depend on whether an individual is employed, but this is generally waived for certain categories including the elderly, disabled individuals, pregnant women and children.