Medicaid is a federal and state funded program for those whose income and resources are insufficient to meet the cost of necessary medical care. Individual states design and administer the Medicaid programs (typically through the state’s Department of Public Welfare) under broad guidelines established by the federal government.

To qualify for Medicaid, individuals must meet income and other eligibility requirements. Once a person is determined to qualify with low income and low assets, the person must meet other qualifiers, some of which are blindness, disability, pregnancy, age (over 65), or caring for children receiving welfare benefits. For many eligibility groups, income is calculated in relation to a percentage of the Federal Poverty Level (FPL). 

After the implementation of the Affordable Care Act, new, modernized rules regarding verification of Medicaid eligibility will mean that state Medicaid agencies will rely primarily on information available through data sources (such as the Social Security Administration, the Departments of Homeland Security and Labor) rather than paper documentation from families. Each state has prepared a verification plan for Medicaid in order to comply with the new rules.

In addition to certain levels of income and assets, there are other nonfinancial eligibility criteria that are used in determining Medicaid eligibility. In order to be eligible for Medicaid, individuals need to satisfy federal and state requirements regarding residency, immigration status, and documentation of U.S. citizenship.

Medicaid mandates that the states provide at least the following services:

• Physician’s services;
• Inpatient hospital care;
• Outpatient hospital care;
• Skilled nursing home services;
• Laboratory and x-ray services;
• Home health care services;
• Rural health clinic services;
• Periodic screening, diagnosis, and treatment;
• Family planning services; and
• Medicaid also pays for prescription drugs, dental services, private duty nursing services, eyeglasses, check-ups, and medical supplies and equipment.