Introduction to Medicaid

What is Medicaid?

Medicaid provides health care to low income and underprivileged people. It also supplies long-term health coverage and help to Medicare recipients and permanently disabled people. Medicaid is co-funded by both the states and the Federal Government. The entire program is overseen by the Federal government but it is a state administered health care program. The federal government has established general guidelines for Medicaid but each state then takes those guidelines and reinterpreted them in different ways. Each state determines its own eligibility guidelines and requirements and these can vary state to state. Medicaid covers many different types of people; the overall criterion that unites them all is that they are poor or unable to financially meet their own health care needs. Beyond this, certain requirements might include things like:

  • Age
  • Disability
  • Income and resources
  • U.S. Citizen or legal resident
  • Dependents
  • Children's resources and status.

Medicaid recipients are divided into two main groups, the categorically needy and the medically needy. Medicaid is also available to Medicare recipients, disabled working persons and people who meet other special circumstances.

Categorically Needy Medicaid Recipients

Categorically needy individuals include people that are the most needy people in society. Each state sets it's own guidelines beyond these basic requirements. Categorically needy people include:

  • Families who meet states' Aid to Families with Dependent Children (AFDC) eligibility requirements.
  • Pregnant women and children 6 and under whose family income is not more than 133 % of the Federal poverty level.
  • Families with children ages 6 to 19 whose income in no more than 100% of the Federal poverty level.
  • Supplemental Security Income (SSI) recipients (and sometimes old or disabled people who meet state guidelines that are more restrictive).
  • Individuals living in medical institutions and who have monthly incomes up to 300% of the Federal SSI rate.

Medically Needy Medicaid Recipients

These are people that for one reason or another cannot get health care to meet their medical needs. Not all states have medically needy programs. Each state again sets their own parameters for meeting the Medically needy requirements. Medically needy people can include:

  • College age or younger children who are full-time students. State can further limit eligibility to certain groups of children.
  • Caretaker relatives.
  • Older people (age 65 and older).
  • Blind or disabled persons.
  • People who would be eligible but have another form of creditable coverage.

Medicare Medicaid Recipients

A Medicare recipient whose income is at or below the Federal poverty level and without adequate resources can have Medicaid pay their patient out-of-pocket costs including: Medicare premiums, deductibles and coinsurance. These people are called Qualified Medicare Beneficiaries (QMB).

Each State has its Own Medicaid Program

Medicaid programs are all different throughout the many states and they all work a little bit differently. In some states Medicaid is bundled together with a wide range of other state assistance programs and they are managed together under one agency. When this is the case, a Medicaid recipient generally files fewer applications and wait times can be shorted. Some states have turned their entire Medicaid program over to private contractors. Other states have adopted their own unique interpretations of the program. Massachusetts and Minnesota are two such examples. In other states, the entire program is run like one large HMO. How Medicaid works or doesn't work varies state by state.

In all states Medicaid recipients must apply to the program with an application and meet certain types of residency, means and needs requirements. Once a person is accepted into Medicaid they will receive a Medicaid card and are able to use services with only small co-pays. In most states care can be covered retroactively for up to three months by Medicaid.

Medicaid Doesn't Cover Everyone Who is Poor

Not everyone meets the requirements of Medicaid. Men and women of working age without children are largely excluded from Medicaid. Because Medicaid is means and needs based when a recipient's circumstances change they may become ineligible for Medicaid and other types of aid and benefits. This level right above the means test for Medicaid is often the group that suffers the most. Generally speaking. The people in this group still can't afford to pay for health care but they also don't qualify for Medicaid. Some states have addressed this problem by providing an additional provision based on medical needs that provides some help. Medical needs based programs can include full-time students and people with assets and incomes that are just above the requirements.