Medicaid eligibility for individuals 65 and older or who have blindness or a disability is generally determined using the income methodologies of the SSI program administered by the Social Security Administration (some states, known as 209(b) states, use certain more restrictive eligibility criteria than SSI, but still largely apply SSI methodologies). Some individuals are exempt from the MAGI-based income counting rules, including those whose eligibility is based on blindness, disability, or age (65 and older). The MAGI-based methodology does not allow for income disregards that vary by state or by eligibility group and does not allow for an asset or resource test.
MAGI replaced the former process for calculating Medicaid eligibility, which was based on the methodologies of the Aid to Families with Dependent Children program that ended in 1996. The MAGI-based methodology considers taxable income and tax filing relationships to determine financial eligibility for Medicaid. MAGI is the basis for determining Medicaid income eligibility for most children, pregnant women, parents, and adults. By using one set of income counting rules and a single application across programs, the Affordable Care Act made it easier for people to apply and enroll in the appropriate program. MAGI is used to determine financial eligibility for Medicaid, CHIP, and premium tax credits and cost sharing reductions available through the health insurance marketplace. The Affordable Care Act established a new methodology for determining income eligibility for Medicaid, which is based on Modified Adjusted Gross Income (MAGI). Determining Eligibility for Medicaid Financial Eligibility See if your state has expanded Medicaid coverage to low-income adults.
Most states have chosen to expand coverage to adults, and those that have not yet expanded may choose to do so at any time. Eligibility for children was extended to at least 133% of the federal poverty level (FPL) in every state (most states cover children to higher income levels), and states were given the option to extend eligibility to adults with income at or below 133% of the FPL. The Affordable Care Act of 2010 created the opportunity for states to expand Medicaid to cover nearly all low-income Americans under age 65. States have additional options for coverage and may choose to cover other groups, such as individuals receiving home and community-based services and children in foster care who are not otherwise eligible. Low-income families, qualified pregnant women and children, and individuals receiving Supplemental Security Income (SSI) are examples of mandatory eligibility groups. To participate in Medicaid, federal law requires states to cover certain groups of individuals. Medicaid is the single largest source of health coverage in the United States. Medicaid is a joint federal and state program that, together with the Children’s Health Insurance Program (CHIP), provides health coverage to over 72.5 million Americans, including children, pregnant women, parents, seniors, and individuals with disabilities.