In January, throughout a congressional hearing on his option to changing into secretary of the Division of Well being and Human Providers, Robert F. Kennedy Jr. received fundamental particulars incorrect about Medicaid — a program he now oversees.
He mentioned that Medicaid is absolutely funded by the federal authorities (it’s not) and that many enrollees are unhappy with excessive out-of-pocket prices (enrollees pay restricted, if any, out-of-pocket prices).
Medicaid is complex. The $880 billion-a-year state-federal program presents well being protection to tens of millions of disabled and low-income Individuals. This system covers completely different providers for various individuals in numerous components of the nation — and enrollees could work together with personal insurance coverage corporations with out “Medicaid” of their names, leaving some unaware that they’re on this system in any respect.
Though President Donald Trump promised to “love and cherish” Medicaid, Republicans in Congress final week introduced federal funds proposals that would dramatically curtail this system. As that debate begins, here’s what you have to learn about Medicaid.
What’s Medicaid, and the way is it completely different from Medicare?
Medicaid and Medicare have been created by the identical laws — an addition to the Social Safety Act — that was signed into regulation by President Lyndon B. Johnson in 1965.
Medicaid is a authorities medical health insurance program for individuals with low incomes and adults and kids with disabilities.
Medicare, against this, usually covers these 65 or older.
For older Individuals with low incomes, Medicaid covers out-of-pocket prices for Medicare. Such persons are generally known as “twin eligibles,” as a result of they qualify for each applications.
Who’s on Medicaid?
Greater than 79 million individuals obtain providers from Medicaid or the carefully associated Kids’s Well being Insurance coverage Program. That represents about 20% of the full inhabitants of the US. Most enrollees qualify due to low incomes.
About 40% of all kids within the nation are coated by Medicaid or CHIP, created in 1997. Each pay for providers equivalent to routine checkups, vaccinations, and hospital stays. Medicaid additionally covers pregnant individuals earlier than and after they offer start and pays for greater than 40% of all births.
Medicaid additionally covers individuals with disabilities or complicated medical wants and helps them afford providers that permit them to reside independently in neighborhood settings, outdoors of establishments equivalent to nursing properties and state-run hospitals.
This system serves a various cross part of the nation. About 40% of individuals beneath 65 who use Medicaid are white, 30% are Hispanic, 19% are Black, and 1% are Indigenous individuals.
Federal Medicaid {dollars} can’t be used to cowl immigrants who’re within the U.S. with out authorized permission, although some states, in addition to Washington, D.C., have used their own funds to increase Medicaid protection to such people. California was the primary state to take action.
What are the revenue {qualifications}?
Eligibility usually depends upon whether or not an individual is low revenue, and states have other ways of defining that. For a four-adult family with out dependent kids, the present nationwide median protection stage is $44,367.
The Inexpensive Care Act, typically known as Obamacare, which handed in 2010, allowed extra individuals to qualify for Medicaid on the idea of revenue. That is what is called “Medicaid enlargement.”
The regulation provided states a large incentive so as to add extra individuals to their applications: The federal authorities would pitch in more cash per enrollee to assist cowl them.
The intention behind the enlargement was to shut gaps in medical health insurance applications for the tens of millions of Individuals who don’t get protection via an employer. Medicaid would cowl individuals with extraordinarily low incomes, and as their incomes rose, they may transfer to sponsored well being plans bought via the Inexpensive Care Act’s exchanges.
In 2012, the U.S. Supreme Court docket mentioned the choice of whether or not to increase this system can be left up to individual states. At the moment, 40 states and the District of Columbia — led by Democrats and Republicans alike — have opted in.
Within the 10 states that haven’t expanded Medicaid to extra low-income adults, the median earnings qualification stage is $5,947 a yr for a single-person family in 2025. Those that make extra usually are not eligible.
Adults in these states who make an excessive amount of for Medicaid can even make too little to qualify for assist shopping for plans on the Inexpensive Care Act exchanges, leaving some unable to afford protection. An estimated 1.5 million fall into this protection hole.
The place does the cash to pay for it come from?
The federal authorities pays most of the price of Medicaid by matching a portion of what states spend.
At the moment, the federal authorities matches not less than 50% of state spending and presents states more cash for some providers and enrollees — for example, for kids and pregnant girls.
Much less rich states — decided by contemplating residents’ per capita incomes — obtain a better match, translating to a better proportion of federal {dollars}. In Mississippi, for example, the federal authorities picks up 77% of the cost of Medicaid.
States additionally obtain a 90% match from the federal authorities for enrollees eligible for Medicaid beneath the ACA’s enlargement.
There isn’t any restrict on how a lot states can spend on this system, and a whole lot of billions of federal {dollars} circulate into states annually. In 2023, states spent about 15% of their very own budgets on Medicaid.
What does that cash pay for?
Federal regulation requires all state Medicaid applications to cowl sure providers, together with emergency medical transportation, X-rays and lab work, household planning, and medication-assisted therapy for individuals with opioid use dysfunction. This system additionally covers many nursing and residential well being providers, although federal regulation permits these advantages to be clawed back after an enrollee’s dying.
Past that, states have the pliability to decide on the providers their Medicaid applications cowl. All states cowl prescribed drugs, and most cowl eyeglasses, some dental care, and bodily remedy.
Medicaid covers extra psychological well being and long-term care providers than another sort of insurance coverage, public or personal.
What’s Medicaid known as in my state?
Medicaid applications can go by many different names, even inside the similar state, partly as a result of most states use personal insurance coverage corporations to run them. This may be complicated for shoppers who could not notice they’re really enrolled in Medicaid.
In New York, for example, Medicaid plans are provided by main corporations, equivalent to Anthem Blue Cross Blue Defend and UnitedHealthcare — and a few chances are you’ll not have heard of, equivalent to Amida Care and MetroPlusHealth. In Wisconsin, enrollees could also be in BadgerCare Plus; in Connecticut, Husky Well being; in Texas, STAR; and in California, Medi-Cal.
How does Medicaid have an effect on hospitals and docs in my state?
Medicaid usually pays well being care suppliers equivalent to docs and hospitals much less cash for providers than Medicare or personal insurance coverage does. However it may be more cash than they’d get caring for people who find themselves uninsured — and with out Medicaid, many extra Individuals can be uninsured.
Like states, suppliers and hospitals have come to depend on this cash and categorical issues that even phasing it out over time would require main changes.
What’s going to occur to Medicaid?
It’s not clear. Republicans in Washington are once more pushing for main modifications, which might take the type of cuts to federal funding. That might cut back the quantity of people that qualify, the providers accessible, or each. An identical push targeted on repealing and changing Obamacare in 2017, throughout Trump’s first time period, was unsuccessful.
Maybe one of many greatest obstacles to altering Medicaid is its popularity: 77% of Individuals — and majorities of Democrats, independents, and Republicans — view this system favorably.
On the coronary heart of all of it are key questions concerning the function of presidency in individuals’s well being: How large ought to the U.S. medical insurance coverage security internet be? Who deserves authorities help? And the way will enrollees, states, suppliers, and the well being care system at massive take in main modifications to Medicaid, even when a rollout have been staggered?
