Medicaid is a public health insurance program in the United States. It is a federal-state partnership program, meaning it is administered by states, according to requirements set by the federal government. It is important to note that while it is a federal-state program, Medicaid very much operates on a state-by-state basis.

As of July 2022, nearly 82.8 million Americans were enrolled in Medicaid, making it the single largest insurance program in the US. Following a period of enrollment declines from 2017 to 2019, the COVID-19 pandemic accelerated Medicaid enrollment, which was up 29.5% from February 2020 to July 2022. That recent increase in enrollment was driven by economic changes (increased unemployment), Medicaid expansion initiatives, and the temporary continuous enrollment requirement (aka Families First Coronavirus Response Act), which blocked states from disenrolling Medicaid members during the emergency period. This emergency order ended in January 2023 and has since decreased the number of people enrolled in Medicaid plans. In from January to September 2024, Medicaid enrollment declined by approximately 7.5%.

Generally speaking, there are three types of Medicaid beneficiaries:

1. Temporary Assistance for Needy Families (TANF): 60% of total, anyone with a child under 19, not made eligible through income level
2. Affordable Care Act (ACA) Expansion: 25% of total, mostly folks who lose their job and then qualify for Medicaid, eligible because of income level - between the poverty line and up to 138% of it, most but not all states offer this
3. Aged, Blind & Disabled (AB&D) and Long-Term Services & Support (LTSS): 15% of total, eligible because of clinical needs, they are likely to be on Managed Medicaid their whole lives, although they might move plans

TANF is technically a separate program from Medicaid. TANF is a federal assistance program providing cash support and other services to low-income families, while Medicaid is a health insurance program for low-income individuals and families. TANF recipients often qualify for Medicaid through categorical eligibility, but the two programs serve different purposes and are administered separately.

Eligibility

The following sections are almost entire copied from this Article by Amanda DiTrolio

States are subject to various federal requirements in order to participate in Medicaid – one of those requirements comes into play when we talk about eligibility. In fact, there is a list of mandatory eligibility groups – such as individuals on Supplemental Security Income (SSI), pregnant women and children, low-income families, and more. Beyond covering these groups, states have the option to cover several other groups, including individuals receiving home and community-based services (HCBS), and children in foster care, among others.

There are two main buckets of criteria that individuals must satisfy to be eligible for Medicaid: 1) financial and 2) categorical.

Financial criteria (MAGI pathway): In 2014, the Affordable Care Act (ACA) streamlined a new methodology for determining income eligibility, which today is based on Modified Adjusted Gross Income (MAGI). The MAGI pathway applies to pregnant people, parents, and children with low incomes. This methodology factors in taxable income and tax filings to determine financial eligibility for Medicaid. Following the ACA’s Medicaid expansion, most states (39 year-to-date) have expanded Medicaid coverage for adults with incomes up to 138% of the federal poverty level (FPL). Medicaid expansion itself is a major political hot ground and thus, it is important to note that not all states have not adopted Medicaid expansion – in fact, 12 states cover fewer individuals, which is shown through their lower FPL limits. You can see those Medicaid income eligibility limits for adults (as a % of FPL) across all states in this KFF database. Additionally, Still need health insurance? provides a helpful tool for individuals to quickly identify if they qualify for Medicaid (or CHIP) based on income levels here.

• Children’s Health Insurance Program (CHIP) is not just Medicaid for children, it specifically provides low-cost health coverage to children of families that earn too much money to qualify for Medicaid, but too little to afford private insurance. In some (6) states – including Colorado, Missouri, and New Jersey – CHIP also covers pregnant women.

Categorical criteria (non-MAGI pathways): Outside of individuals covered by Medicaid through the MAGI pathway described above, states have the option to cover other groups that can qualify through non-MAGI pathways. These include people with significant health needs – such as seniors and individuals with disabilities – whose income is too high to otherwise qualify for Medicaid. It is important to understand that nearly all non-MAGI pathways are optional, which results in significant state variation. You can see state by state adoption of major optional non-MAGI pathways in Table 1 here.

• Dual-eligible beneficiaries are individuals who qualify for Medicare and are also eligible for some level of assistance from their state Medicaid program - and thus are enrolled in both Medicare and Medicaid simultaneously.
• Long-Term Services & Support (LTSS): Medicaid serves as the primary payor in the US for long-term care services. While most people aged 65 and older (and many under 65 with disabilities) have Medicare, many of these long-term services are actually covered by Medicaid. Millions of Americans – including children, adults, and seniors – require access to these services to treat various disabilities and chronic conditions.
  • These long-term services help individuals live more independently by providing assistance with personal and healthcare needs – such as eating, bathing, medication management, walking, getting dressed, and more.
  • Under the LTSS umbrella, there are two main models for the delivery of services. The type of service/care is typically quite similar between the two - what differs is how the care is delivered and where the patient lives:
    • Home- and community-based care (HCBS): Primary location is in the patients’ home or home community
    • Institutional-based care: Primary locations include assisted living centers, adult family, and nursing homes

Medicaid Funding Structure

As mentioned, Medicaid is jointly funded by states and the federal government. The federal share costs are determined by the Federal Medical Assistance Percentage (FMAP) calculation. Each state has a single agency that administers Medicaid. Part of the deal when receiving federal funding for Medicaid is that states must meet a set of requirements as mandated by federal law.

Every state must create a Medicaid State Plan that describes the structure and scope of its program in detail, which is then reviewed and approved by the Department of Health & Human Services (HHS). Here is the plan for the State of New York, as an example.