Medicaid is the United States’ public health insurance program for people with low incomes. It covers doctor visits, hospital stays, long-term nursing care, children’s health services, and more, with nearly all costs paid by the government rather than the patient. As of November 2025, about 76 million people were enrolled in Medicaid and the closely related Children’s Health Insurance Program (CHIP), making it the largest source of health coverage in the country.
Who Qualifies for Medicaid
Medicaid eligibility is based primarily on income, measured as a percentage of the federal poverty level (FPL). The exact thresholds vary by state, but federal law sets minimum standards. Children, pregnant women, parents, seniors, and people with disabilities each have different income cutoffs. A state might cover children in families earning up to 200% of the poverty level, for example, while setting a lower bar for adults without children.
One of the biggest eligibility changes came through the Affordable Care Act, which gave states the option to expand Medicaid to all adults earning up to 138% of the federal poverty level. Forty states plus Washington, D.C. have now implemented that expansion. In the remaining states, many low-income adults without children still have no pathway to Medicaid coverage, even if their income is very low.
People who are 65 or older or who have certain disabilities can qualify for both Medicare and Medicaid at the same time. These “dual-eligible” individuals get Medicare as their primary insurance, while Medicaid fills in the gaps: paying Medicare premiums, covering copayments, and providing services Medicare doesn’t offer, particularly long-term care.
What Medicaid Covers
Federal law requires every state Medicaid program to cover a core set of services. These include inpatient and outpatient hospital care, physician visits, lab work and X-rays, nursing facility care, home health services, family planning, and transportation to medical appointments. States must also cover nurse midwife services, pediatric and family nurse practitioner care, and medication-assisted treatment for substance use disorders.
Beyond that required list, states can choose to offer additional benefits. The most notable optional services include prescription drugs, dental care, vision care (including eyeglasses), physical therapy, occupational therapy, speech therapy, mental health services in certain settings, prosthetics, and personal care assistance. Nearly every state covers prescription drugs even though it’s technically optional, but dental and vision coverage for adults varies significantly from state to state. Some states offer comprehensive adult dental benefits while others cover only emergency dental procedures.
Children’s Coverage Under EPSDT
Children enrolled in Medicaid receive one of the most comprehensive benefit packages in American health insurance through a program called Early and Periodic Screening, Diagnostic, and Treatment (EPSDT). This is a mandatory benefit, meaning every state must provide it.
EPSDT requires regular well-child checkups that include a full physical exam, developmental screening, immunizations, lab tests (including lead screening at ages 12 and 24 months), and health education for parents. Vision and hearing screenings are built in, and when problems are found, the program covers treatment, including hearing aids and eyeglasses. Dental care is also required for children, covering everything from routine maintenance to pain relief to medically necessary orthodontics.
The most powerful feature of EPSDT is its treatment guarantee. If any screening or checkup reveals a health problem, the state must cover whatever medically necessary treatment is needed to address it, even if that specific service isn’t otherwise included in the state’s Medicaid plan. This makes children’s Medicaid coverage broader in practice than almost any other form of insurance.
Long-Term Care
Medicaid is the primary payer for long-term care in the United States. This includes nursing home care, which is a mandatory benefit, as well as a growing range of home and community-based services that help people remain in their own homes. These community-based options can include personal care aides, adult day programs, home modifications, and other supports designed to keep people out of institutional settings.
This role is significant because Medicare, the program most seniors rely on, covers only short-term rehabilitative stays in skilled nursing facilities, not the kind of ongoing custodial care many older adults eventually need. When someone requires years of nursing home care and has exhausted their savings, Medicaid is typically what pays the bill.
How Medicaid Is Funded
Medicaid is jointly funded by the federal government and individual states. The federal share of costs, called the Federal Medical Assistance Percentage (FMAP), ranges from a minimum of 50% to a maximum of 83%, depending on a state’s per capita income. Wealthier states receive the minimum 50% match, while lower-income states receive a higher federal share. This formula is designed so that poorer states don’t bear a disproportionate burden for covering their residents.
Each state runs its own Medicaid program within federal guidelines, which is why coverage, eligibility rules, and provider networks can look quite different depending on where you live. A service that’s fully covered in one state might not be available in another.
What You Pay Out of Pocket
Medicaid is designed to have minimal cost to the patient. Federal rules cap the total amount a household can be charged in premiums and cost-sharing at 5% of the family’s income. For people at or below the poverty level, copayments are capped at small amounts: up to $4 for an outpatient visit, up to $75 for a hospital stay, and up to $4 for preferred prescription drugs. Most Medicaid populations cannot be charged premiums at all.
For people with incomes between 100% and 150% of the poverty level, copayments can rise to 10% of what Medicaid pays for a service. Above 150% FPL, cost-sharing can reach up to 20%. In practice, though, many enrollees pay little to nothing when they see a doctor or fill a prescription. States are generally not allowed to deny care to someone who cannot afford a copayment, with limited exceptions like non-emergency use of an emergency room.
Medicaid vs. Medicare
These two programs are often confused, but they serve different populations and work differently. Medicare is federal health insurance for people 65 and older (and some younger people with disabilities or kidney failure). It’s available regardless of income. Medicaid is for people with low incomes, regardless of age. Medicare has significant gaps, particularly in long-term care, dental, and vision coverage, along with premiums and deductibles that can add up.
About 12 million Americans qualify for both programs simultaneously. For these dual-eligible individuals, Medicare pays first for hospital and doctor visits, while Medicaid picks up remaining costs. Depending on income level, Medicaid may cover their Medicare premiums, deductibles, and copayments, and it provides additional benefits like long-term nursing care that Medicare simply doesn’t offer.