Medicaid Income Limits

Medicaid is the largest health insurance program in the United States, covering over 90 million Americans. Whether you qualify — and what coverage you receive — depends primarily on your household income relative to the federal poverty level (FPL) and which state you live in. The Affordable Care Act's Medicaid expansion (2014) extended eligibility to adults up to 138% FPL (~$20,800 for a single person in 2026), but 10 states have not adopted expansion, leaving millions of low-income adults in a coverage gap — earning too much to qualify for traditional Medicaid but too little to qualify for ACA premium tax credits. For working-age adults without children in non-expansion states, Medicaid often remains inaccessible regardless of income. For children, pregnant women, the elderly, and people with disabilities, federal minimum eligibility floors are higher and apply in every state.

Medicaid provides health coverage to low-income individuals and families. Eligibility is based on Modified Adjusted Gross Income (MAGI) as a percentage of the Federal Poverty Level (FPL), with significant variation between expansion and non-expansion states.

Category	Expansion States	Non-Expansion States
Adults (19-64, no children)	138% FPL (~$20,800)	Generally not eligible
Parents/caretakers	138% FPL	Varies (often 40-100% FPL)
Pregnant women	138-200%+ FPL	138-200%+ FPL
Children (0-5)	138-300%+ FPL	138-200%+ FPL
Children (6-18)	138-300%+ FPL	100-200% FPL
Elderly/disabled (SSI)	SSI income level	SSI income level

Legal Authority

42 U.S.C. § 1396a — State plans for medical assistance (mandatory and optional eligibility groups, income methodologies)
42 U.S.C. § 1396d — Definitions (medical assistance, covered services, expansion group definition, FMAP)
ACA Section 2001 — Medicaid expansion (made optional by NFIB v. Sebelius)
42 CFR Part 435 — Eligibility in the states, DC, and territories
8 USC § 1611 — Ineligibility of non-qualified aliens for federal public benefits: non-qualified immigrants generally cannot receive Medicaid, with key exceptions for emergency Medicaid (emergency medical conditions only, not organ transplants), immunizations, and communicable disease treatment
8 USC § 1613 — Five-year bar: qualified aliens entering the U.S. on or after August 22, 1996 are barred from Medicaid for 5 years; refugees, asylees, Cuban/Haitian entrants, veterans, and trafficking victims are exempt
8 USC § 1622 — State authority: states may choose to provide state-funded Medicaid coverage to qualified aliens during the federal 5-year waiting period; many states exercise this option for pregnant women and children

How It Works

Since 2014, most Medicaid eligibility for non-elderly, non-disabled adults and children is determined using Modified Adjusted Gross Income (MAGI) — the same income concept used for ACA Marketplace subsidies, based on federal tax return income rather than the old asset-plus-income welfare methodology. A built-in 5% income disregard effectively raises the income ceiling: a state that expands Medicaid to 138% of the federal poverty level is actually providing coverage to households earning up to 143% FPL after the disregard. No asset test applies to MAGI-based eligibility groups — you can have a savings account, a car, or other assets and still qualify based on income alone. This is a significant departure from pre-ACA Medicaid, which had extensive asset tests. Elderly and disabled eligibility tracks (Supplemental Security Income-related Medicaid) may still include asset tests, which is why Medicaid long-term care eligibility (LTC spend-down) has very different financial rules from coverage for working-age adults.

The coverage gap is the most significant structural problem in the post-ACA Medicaid landscape. States that expanded Medicaid cover adults earning up to 138% FPL. The ACA's Marketplace premium tax credits are available starting at 100% FPL. In the 10 non-expansion states (Alabama, Florida, Georgia, Kansas, Mississippi, South Carolina, Tennessee, Texas, Wisconsin, Wyoming), an adult earning below 100% FPL is too poor for Marketplace subsidies but doesn't qualify for Medicaid under the state's traditional eligibility rules — leaving them in a gap with no affordable coverage option. Florida announced it would expand Medicaid in 2024, though the effective date and implementation details matter; check Medicaid Expansion Status for the current state count. Section 1115 waivers allow some non-expansion states to partially expand or impose work requirements and other conditions not permitted under standard Medicaid rules.

Medicaid provides retroactive coverage for up to 3 months before the application date if the applicant would have been eligible during that period — this retroactive window can be critical for a hospitalization or major medical expense that occurred before someone applied. Managed care now dominates Medicaid delivery: approximately 70% of Medicaid enrollees are in managed care plans (HMOs contracted with state Medicaid agencies), which means enrollees may have network restrictions similar to commercial insurance. After the COVID-era continuous enrollment requirement ended in 2023–2024 (Medicaid unwinding), states conducted eligibility redeterminations that resulted in millions of disenrollments — many for procedural reasons (outdated address, missed mail) rather than actual ineligibility. Federal law requires 12-month continuous eligibility for children, preventing disenrollment during the year even if a child's family income rises; some states have extended continuous eligibility to adults.

How It Affects You

If you're near the Medicaid income threshold and trying to understand your coverage options: The eligibility cliff is real but navigable. In the 40 expansion states and DC, adults at or below 138% FPL (~$20,800/year for a single person in 2026) qualify for Medicaid. At 139% FPL, you fall off Medicaid and onto the ACA Marketplace — where you'd qualify for premium tax credits, but with different providers, networks, and cost-sharing. The 5% income disregard under MAGI means you effectively qualify for Medicaid if your income is up to about 143% FPL. In the 10 non-expansion states (Texas, Florida, Georgia, Alabama, Mississippi, South Carolina, Tennessee, Kansas, Wisconsin, Wyoming), adults without children are generally ineligible for Medicaid regardless of income — the "coverage gap" affects 1.4 million Texans alone. In those areas, community health centers provide sliding-scale primary care regardless of ability to pay. If you had a life event (job loss, reduced hours, new baby) that dropped your income, apply for Medicaid immediately — Medicaid covers expenses up to 3 months retroactively, so coverage can begin before your application is processed.

If you're an early retiree (ages 55-64) managing income before Medicare: Medicaid eligibility is one of the most financially consequential reasons to manage your income in early retirement. In expansion states, a single person with income below ~$20,800/year qualifies for Medicaid with essentially no premiums, no deductibles, and low copays. A 60-year-old with $500,000 in savings and $15,000 in income can qualify for Medicaid if they structure their withdrawals carefully — Medicaid uses MAGI-based income (not assets) for most eligibility groups. This means delaying Roth conversions, managing capital gain realizations, and carefully timing IRA withdrawals can keep you in Medicaid rather than paying $500-800/month for a Marketplace plan. The critical complexity: Medicaid estate recovery. States can recover Medicaid costs from your estate for care received after age 55. For early retirees who don't plan to leave a large estate, this may be acceptable. For those who want to protect home equity or assets, consult a Medicaid planning attorney about the trade-offs.

If you're pregnant or have children with no health insurance: Medicaid coverage for pregnant women and children is significantly broader than for adults generally, in both expansion and non-expansion states. Pregnant women are typically covered at 200% FPL (~$30,000/year) in virtually all states, regardless of expansion status — many states go higher. Coverage starts immediately upon approval and covers prenatal care, delivery, and 60 days of postpartum care. Children are often covered at much higher income levels through Medicaid and CHIP — in most states, children at 200-300% FPL are covered. If you're pregnant or have children and are uninsured, apply at healthcare.gov or your state Medicaid office immediately — there is no open enrollment period for Medicaid; you can apply any time. The retroactive coverage provision (3 months back) can be particularly valuable for pregnancies when women don't realize they're covered until well into the first trimester.

If you're eligible for both Medicare and Medicaid (dual eligible): Dual eligibility is the most comprehensive health coverage available in the United States. Medicaid covers your Medicare Part B premium ($185/month in 2026), your Medicare Part A and B deductibles and cost-sharing, and provides additional benefits that Medicare doesn't cover — including long-term care, dental, vision, and hearing. Dual eligibles also get automatic Extra Help for Medicare Part D prescription drug costs, eliminating most drug copays. If you're on Medicare and your income is at or below about 135% FPL (~$20,400/year), apply for a Medicare Savings Program through your state Medicaid office — even if you don't qualify for full Medicaid, these programs pay your Part B premium and other cost-sharing, saving you at least $2,220/year ($185 × 12). Many eligible seniors don't apply because they don't know about these programs. Your state's State Health Insurance Assistance Program (SHIP) at shiptacenter.org can help you apply at no cost.

State Variations

Medicaid varies more by state than any other major health program:

Expansion states (40 + DC): Adults eligible at 138% FPL. Most recent expansions: SD (2023), NC (2023).

Non-expansion states (10): TX, FL, GA, AL, MS, SC, TN, KS, WI, WY. Texas alone has ~1.4 million people in the coverage gap.

Income limits for parents (non-expansion):

AL: 18% FPL, TX: 17% FPL (among the lowest in the nation)
WI: 100% FPL (childless adults covered through waiver)

Implementing Regulations

42 CFR Part 435 — Eligibility in the States, District of Columbia, and Territories (Medicaid eligibility categories: MAGI-based eligibility for adults under expansion, traditional categorical eligibility, asset and income tests, citizenship and immigration status verification, retroactive eligibility, presumptive eligibility; 153 sections)
42 CFR Part 436 — Eligibility in Guam, Puerto Rico, and Virgin Islands

Pending Legislation (119th Congress)

S447 — Jobs and Opportunities for Medicaid Act (Sen. Kennedy, R-LA) — Conditions Medicaid for able-bodied adults on 20 hours/week of work or volunteer activity, with exemptions, effective Jan 1, 2026
HR3321 — Ending Medicaid Discrimination Against the Most Vulnerable Act (Rep. Roy, R-TX) — Phases down the enhanced 90% federal match for expansion adults from 2027-2034, state-by-state reductions then revert to standard match
S2069 — Stabilize Medicaid and CHIP Coverage Act (Sen. Whitehouse, D-RI) — Extends 12-month continuous enrollment to all Medicaid and CHIP enrollees
HR2445 — Ensuring Medicaid Eligibility Act (Rep. Kennedy, R-UT) — Blocks HHS streamlining rule; requires citizenship verification and quarterly income checks
S2084 — Medicare and Medicaid Dental, Vision, and Hearing Benefit Act (Sen. Alsobrooks, D-MD) — Sets a 90% federal match for adult dental, vision, and hearing Medicaid services
S2410 — Medicaid Bump Act (Sen. Smith, D-MN) — 90% federal match for increased Medicaid behavioral health spending above a 2019 baseline
S523 — Protect Medicaid Act (Sen. Cassidy, R-LA) — Bars federal Medicaid funding for noncitizen program administrative costs
HR 6254 — Medicaid Staffing Flexibility and Protection Act: let states contract out eligibility checks and hearings while banning contractors with financial ties to Medicaid managed care plans. Status: Introduced.
S 4176 — STOP FRAUD in Medicaid Act: expand Medicaid fraud rules so state fraud units can investigate applicants and beneficiaries. Status: Introduced.

Recent Developments

OBBBA Medicaid income limit changes (2025): The One Big Beautiful Bill Act modified Medicaid income eligibility rules in several ways. The bill introduced mandatory income and eligibility re-verification every 6 months (rather than annually) for expansion adults, adding administrative burden that research suggests will cause eligible people to lose coverage during "churn" events. The bill also modified income methodologies for certain Medicaid categories, affecting how MAGI (Modified Adjusted Gross Income) is calculated for ACA expansion populations versus traditional Medicaid populations. States must implement these changes by 2027.
Continuous enrollment ended — coverage cliff (2023-2025): The unwinding of pandemic-era continuous enrollment protections resulted in approximately 25 million people losing Medicaid coverage in 2023-2024 — the largest coverage loss event in Medicaid's history. Many people who lost coverage were still eligible but were disenrolled due to administrative failures (outdated contact information, processing errors, returned mail). CMS required states to implement procedural protections, but coverage losses varied dramatically by state. As of 2026, redetermination churn has stabilized, but states continue to refine their eligibility renewal systems.
Medicaid income limits by category (FPL thresholds in 2026): Income limits vary significantly by eligibility category. Children qualify at up to 200-400% FPL in most states (through CHIP). Pregnant women qualify at 200% FPL minimum under federal law (states may go higher). ACA expansion adults qualify at 138% FPL in expansion states. Traditional Medicaid for non-disabled adults in non-expansion states often caps at 50-100% FPL (some at 15-20% FPL for parents). Seniors and people with disabilities face asset-based Medicaid tests (typically $2,000-$3,000 individual asset limit) in addition to income limits. The OBBBA work requirements apply only to expansion adults (not pregnant women, children, or elderly/disabled beneficiaries).