The Medicaid expansion is a provision of the Affordable Care Act (ACA) that allows states to extend Medicaid coverage to adults earning up to 138% of the federal poverty level. Before this change, most states only covered specific groups like children, pregnant women, and people with disabilities, leaving millions of low-income adults without any affordable insurance option. As of late 2023, 40 states plus Washington, D.C. have implemented the expansion.
Who Qualifies for Expanded Medicaid
The ACA set the eligibility threshold at 133% of the federal poverty level, but it also created a standard 5-percentage-point income disregard. That effectively raises the cutoff to 138% FPL, which is the number you’ll see cited almost everywhere.
In 2025, that translates to the following annual income limits in the 48 contiguous states:
- Single adult: $21,597
- Family of two: $29,187
- Family of three: $36,777
- Family of four: $44,367
Alaska and Hawaii have higher thresholds. A single adult in Alaska qualifies with income up to $26,979, and in Hawaii up to $24,826. The key change from pre-expansion Medicaid is that adults without dependent children can now qualify based on income alone, without needing to fall into a specific category like disability or pregnancy.
How It Became Optional for States
When the ACA passed in 2010, the expansion was mandatory. Every state was required to open Medicaid to this broader population or risk losing all of its existing federal Medicaid funding. In 2012, the Supreme Court ruled in National Federation of Independent Business v. Sebelius that this penalty was unconstitutionally coercive. The ruling kept the expansion intact but made it a state-by-state choice. That decision created the patchwork system that exists today, where coverage depends heavily on which state you live in.
What Expansion Medicaid Covers
Plans for the expansion population must cover the ACA’s ten categories of essential health benefits. These include doctor visits, inpatient and outpatient hospital care, prescription drugs, pregnancy and childbirth services, mental health and substance use treatment, lab work, preventive care, rehabilitative services, pediatric dental and vision, and emergency services. Specific offerings can vary somewhat by state, but the floor is the same nationwide. Adult dental coverage is optional and not guaranteed.
How Expansion Affects Health Outcomes
A large study published in The Lancet Public Health compared mortality rates across expansion and non-expansion states and found that expansion was associated with about 11.8 fewer deaths per 100,000 adults per year. The biggest reductions came from cardiovascular deaths (5 fewer per 100,000) and respiratory deaths (1.6 fewer per 100,000). These are conditions where ongoing access to preventive care, medications, and routine monitoring makes the most difference.
The mortality benefit was not uniform. Some states saw dramatic drops, while a few saw little change. The researchers found that states with larger proportions of women and Black residents saw greater reductions in death rates, suggesting expansion helped close gaps for populations that had been disproportionately uninsured. Cancer deaths, infection-related deaths, and opioid overdose deaths did not show significant differences between expansion and non-expansion states, likely because those conditions depend more on acute events or long-term processes that insurance access alone doesn’t quickly change.
Financial Impact on Hospitals
One of the clearest economic effects of expansion shows up in uncompensated care, the cost hospitals absorb when patients can’t pay. By 2019, hospitals in expansion states had a median uncompensated care burden of 2.55% of operating costs, compared to 6.28% in non-expansion states. That gap is especially stark for rural hospitals, which operate on thinner margins and are more vulnerable to closure.
Rural hospitals in states that expanded on January 1, 2014, saw their uncompensated care drop from 3.79% to 2.84% over the next five years. States that expanded a bit later saw a similar decline, from 4.79% to 2.98%. Rural hospitals in non-expansion states stayed essentially flat at around 6.3%. This pattern helps explain why hospital associations in non-expansion states have often lobbied their legislatures to adopt the expansion.
The Post-Pandemic Enrollment Shift
During the COVID-19 pandemic, a federal rule prohibited states from removing anyone from Medicaid. When that rule expired in April 2023, states began a massive process called “unwinding,” redetermining eligibility for tens of millions of people. Between April 2023 and June 2024, states processed renewals for 94.3 million individuals. Of those, 55.1 million had their coverage renewed, but 20.7 million lost coverage. Overall Medicaid and CHIP enrollment dropped by about 14.9 million people during this period. Many of those who lost coverage were still eligible but were dropped for procedural reasons, like not returning paperwork on time.
Work Requirements and Recent Policy Changes
Some states have pushed to add work requirements to their Medicaid expansion programs, meaning adults would need to prove they are employed, in school, or volunteering a certain number of hours per month to keep their coverage. Arkansas briefly implemented such a requirement before courts struck it down. New federal legislation is now set to impose work requirements on expansion adults nationally, a significant shift from the original structure of the program. The details of implementation will vary, but this change could affect millions of enrollees who would need to document their work activity to maintain benefits.
How to Apply
If you live in an expansion state, you can apply for Medicaid through your state’s Medicaid agency, through HealthCare.gov, or at your state’s health insurance marketplace. The federal government created a single streamlined application that works across programs, so when you apply you’re simultaneously screened for Medicaid, CHIP (for children), and marketplace subsidies. You’ll typically need to provide proof of income, residency, and citizenship or immigration status. Many states also offer hospital presumptive eligibility, which means if you show up at a participating hospital without insurance, the hospital can temporarily enroll you in Medicaid on the spot while your full application is processed.
In the roughly 10 states that have not expanded Medicaid, adults without children who earn too much for traditional Medicaid but too little for marketplace subsidies (below 100% FPL) fall into what’s known as the “coverage gap.” In those states, there is no public insurance option available to this group.