Medicaid provides health insurance coverage to families and certain individuals who cannot afford to pay for private insurance. Although Medicaid is a federal program, each state has its own separate program. The state outlines the age, income and resource requirements necessary to qualify. To receive Medicaid benefits, each state limits the household's income for eligibility.
Sources of Income
An entire household's income is considered when determining Medicaid eligibility. Include the gross monthly income, which is the amount before tax deductions, from both earned and unearned income. Earned income includes wages from employment. Unearned income examples include child support, Social Security payments, alimony or rental income.
Federal Poverty Level
Household income cannot exceed a certain percentage of the Federal Poverty Level (FPL), based on number of people living in the household. Depending on the state, each eligibility group may be allowed a different percentage. For example, in Florida, pregnant women are allowed to earn up to 185 percent of the FPL, while households with children ages one through five are limited to 133 percent of the FPL.
In addition to income limits, Medicaid also restricts the amount of countable assets a person can possess. Your home, primary vehicle, and personal items such as furniture, jewelry and clothing are exempt. Pre-paid burial and funeral expenses are also exempt up to $1,500. The asset limits and requirements vary by state. Typically, pregnant women and infants do not have asset restrictions. Adults, children, individuals over 65 and disabled or blind persons are limited to $2,000 per person or $3,000 per couple, in most states. If you are applying for Medicaid to cover nursing home expenses, the healthy spouse is allowed to maintain a higher amount of assets. For example, in Kansas, a healthy spouse can keep the greater of the first $21,912 of total non-exempt assets or half of the total non-exempt assets, not to exceed $109,560 as of 2011. The amounts are subject to change annually.
Medically needy coverage is offered to applicants who exceed the income limits but have a high amount of medical expenses. The expenses are deducted from the monthly income. If the resulting income is low enough and you meet the other eligibility requirements, you will receive coverage. A deductible or share of cost may be required.