14.6: Medicaid
Medicaid was first enacted as part of the social security act (title 19), with the intention of providing medical care to those experiencing extreme poverty. It is a joint-financed program with at least 50% of the funding coming from the federal government, and the remaining funds from the state. Wealthier states end up contributing more than poorer states (Shi & Singh, 2017). Along with the Children’s Health Insurance Program (CHIP), Medicaid provides insurance to 77.9 million Americans. People are eligible for the program if they: have a disability or blindness, are over the age of 65, or are children whose family makes up to 133% of the Federal Poverty Level (FPL) in income. Recently, Medicaid expanded coverage to any adult that met the income threshold up to 138% of the FPL, but states can opt to participate in this expansion or not. (Centers for Medicare & Medicaid Services, n.d.). The expansion extends eligibility to nearly all adults making up to $20,783 per year, or $1731 per month (for an individual adult) in 2024. To date, only 10 states have opted out of the expansion: Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, Wisconsin and Wyoming. Texas has the lowest income threshold above which people are ineligible for Medicaid: for parents in a family of three this is just $4131 per year or $344 per month (Lopez et al., 2024). Many childless adults in these states fall into the “coverage gap” where they make too much income to qualify for Medicaid but not enough to qualify for federal subsidies to purchase healthcare through the marketplace. These folks often work low wage and/or part time jobs, and either may not be offered employer-sponsored healthcare coverage, or may find it too expensive (Drake et al., 2024).
During the COVID-19 era, states were required to maintain all enrollees during the emergency period. After the emergency period ended in March 2023, states began the process of “unwinding”, or reexamining eligibility for the millions of Americans receiving Medicaid (Unwinding and Returning to Regular Operations after COVID-19, n.d.). Due to technical errors and the complicated enrollment and renewal processes, many Medicaid recipients were either incorrectly dropped or found it difficult to renew their Medicaid insurance. About 8% of those previously receiving Medicaid are now ineligible, and consider purchasing health insurance cost-prohibitive. The unwinding process is adding to the number of uninsured Americans (Lopez et al., 2024).