Groups that States Must Cover
Groups that states must cover in their Medicaid programs are referred to as "categorically eligible" because they fall into a mandatory eligibility category. People who fall into these groups can receive long-term services through Medicaid if they meet the state's clinical/functional eligibility test for needing that level of care.
- Children and Certain Low-Income Adults: States must cover children under age six in families with incomes that are 133 percent of poverty or less and children ages six to 19 in families with incomes up to 100 percent of poverty. States must also cover pregnant women with incomes up to 133 percent of poverty and low-income parents who meet the state’s July 1996 welfare eligibility levels (these vary by state but are often below 50 percent of poverty).
- The Elderly and People with Disabilities: There are several categories of seniors and people with disabilities that states must cover in their Medicaid programs. These are important eligibility pathways for people to gain Medicaid coverage for long-term services. States must cover the following groups:
- Elderly (over 65) people and people with disabilities who meet income eligibility criteria. In most states, this is based on eligibility for Supplemental Security Income (SSI), a federal supplemental income program that helps low-income individuals who are elderly, blind, or disabled. The income eligibility standard for SSI is lower than the federal poverty level, roughly equivalent to 74 percent of poverty. Eleven states are allowed to use an income eligibility test that is more restrictive than SSI, as long as the income test they use is no more restrictive than what they had in place in 1972, when the SSI program started. Those states are called 209(b) states, referring to the section of the Social Security Act that provides the exception. The 209(b) states are Connecticut, Hawaii, Illinois, Indiana, Minnesota, Missouri, New Hampshire, North Dakota, Ohio, Oklahoma, and Virginia.
- Certain people under 65 with severe disabilities who earn a limited income and would meet SSI income eligibility criteria if they did not work. To be eligible for SSI disability benefits, a person must not be able to engage in "substantial gainful employment" because of his or her disability. In 2010, the Social Security Administration defined "substantial gainful employment" as earning $1,000 a month or more for non-blind disabled and $1,640 for the blind. Individuals who earn above these amounts can retain Medicaid coverage if they continue to meet SSI criteria for having a disability, need Medicaid coverage to continue working, and do not earn enough to purchase a "reasonable equivalent" of Medicaid medical and attendant services. States set specific income levels that determine when someone is considered to have sufficient funds to purchase "reasonable equivalent" coverage and would no longer receive Medicaid under this eligibility category.
- Low-income Medicare beneficiaries. For some low-income individuals who are eligible for Medicare but not poor enough for full Medicaid coverage, Medicaid pays Medicare premiums and/or Medicare copayments through special programs. Generally, these individuals have incomes below 150 percent of poverty.
For more information about Medicaid eligibility, visit the Medicaid section of our website.
Health Reform Note: Health reform changes Medicaid eligibility. Starting in 2014, people under 65 with incomes up to 133 percent of poverty will be eligible. For people over 65 or who are eligible because they receive other assistance, eligibility requirements are not changed. That group would include most people who are Medicaid-eligible and who need long-term services. Please see the Medicaid and Health Reform Central sections of our website for more details.
Spousal Financial Protection
In addition, the federal government requires that state Medicaid programs have a provision that protects the assets of a community-living spouse of someone who lives in a long-term care facility. This allows the individual in the facility to qualify for Medicaid without requiring the community-living spouse to become impoverished.
Each state develops a formula for dividing a couple's assets to determine how much the community-living spouse may retain. However, the federal government sets an upper and lower limit on the amount the community-living spouse can retain. These limits exclude certain assets, such as the value of a primary home. In 2009, a state could allow a community-living spouse to retain as much as $109,560 in assets. States cannot require the community-living spouse to deplete assets below $21,912.
States have the option of extending the same financial protections if one member of a couple is receiving home- and community-based services in Medicaid.
Health Reform Note: Effective in 2014, health reform requires that states extend financial protection when one spouse is receiving home- and community-based care. This requirement lasts for five years.
