Medicaid Eligibility: Income Limits, Asset Tests, and How to Apply
Last updated 06/02/2026 by
Ante Mazalin
Edited by
Andrew Latham
Summary:
Medicaid eligibility is the set of income, asset, age, and categorical requirements a person must meet to qualify for Medicaid, the joint federal-state health insurance program that provides free or low-cost coverage to low-income individuals and families.
Eligibility falls into four broad pathways.
- Income-based eligibility: Adults in states that expanded Medicaid under the ACA qualify if their household income is at or below 138% of the federal poverty level, regardless of other factors.
- Categorical eligibility: Certain groups — pregnant women, children, parents of dependent children, and people receiving Supplemental Security Income qualify through their status rather than income alone.
- Disability-based eligibility: People who receive SSI or meet specific disability criteria qualify for Medicaid in most states, often with higher income limits than standard adult categories.
- Long-term care eligibility: Older adults and people with disabilities who need nursing home or home-based care face income and asset tests that differ significantly from standard Medicaid rules.
Medicaid is administered by each state within federal guidelines, which means eligibility rules, covered services, and income thresholds vary meaningfully depending on where you live. A household that qualifies in one state may not qualify in another.
Income limits for Medicaid eligibility
Income eligibility is measured as a percentage of the federal poverty level (FPL), which the federal government updates annually. The threshold varies by eligibility group and by whether the state has expanded Medicaid.
| Eligibility Group | Income Limit (% of FPL) | Notes |
|---|---|---|
| Adults (expansion states) | Up to 138% | Applies in the 41 states + D.C. that expanded Medicaid under the ACA |
| Adults (non-expansion states) | Varies widely; often well below 100% | Many non-expansion states cover only specific categories of adults |
| Children (CHIP / Medicaid) | Up to 200% or higher, depending on the state | Most states cover children at significantly higher thresholds through CHIP |
| Pregnant women | Up to 138%–213%, depending on the state | The federal minimum is 138%; many states cover higher |
| Nursing facility residents | Up to 300% of the SSI benefit rate | Asset limits also apply; rules vary significantly by state |
Income is measured using Modified Adjusted Gross Income (MAGI) for most non-elderly, non-disabled groups. For elderly and disabled applicants, the calculation uses a different income methodology established before the ACA.
Asset limits in Medicaid eligibility
For most non-elderly adults qualifying under ACA expansion rules, there are no asset tests; only income is evaluated. Asset tests apply primarily to elderly and disabled applicants, particularly those seeking long-term care coverage.
For long-term care Medicaid, states typically allow a single applicant to retain a small amount of countable assets, commonly $2,000, though limits vary by state. According to the Centers for Medicare and Medicaid Services, certain assets are excluded from the asset count, including the primary home (subject to conditions), one vehicle, household goods, personal effects, and burial-related funds up to certain limits.
Pro Tip
Medicaid has a five-year lookback period for long-term care eligibility. If you transferred assets for less than fair market value within five years of applying for long-term care Medicaid, the state can impose a penalty period during which Medicaid will not cover nursing home costs. This rule catches many families off guard when a parent needs nursing home care suddenly. Estate planning with a qualified elder law attorney well before care is needed is the most effective way to navigate this rule lawfully.
Which states have expanded Medicaid
The ACA gave states the option to expand Medicaid to cover adults with incomes up to 138% of the FPL. As of 2025, 41 states and the District of Columbia have adopted expansion. The nine states that have not adopted expansion, including Texas, Florida, and Georgia, leave a coverage gap for adults who earn too much for traditional Medicaid but too little to qualify for ACA marketplace subsidies.
In non-expansion states, childless adults generally cannot qualify for Medicaid regardless of income unless they have a disability or qualify through another categorical pathway. This is one of the most significant geographic variations in the U.S. health coverage landscape.
How to apply for Medicaid
Applications can be submitted through multiple channels, depending on your state.
- Apply through Healthcare.gov: If you apply for coverage through the federal or state marketplace and appear to qualify for Medicaid based on your income, the marketplace will automatically transfer your application to your state Medicaid agency.
- Apply directly through your state Medicaid agency: Every state has an online portal or paper application. Search “[your state] Medicaid application” to find the correct portal. State agencies process applications and determine eligibility based on their own rules.
- Apply in person: Visit your local Department of Social Services, health department, or Medicaid office. Some applicants prefer this route if they need help completing the application or have questions about documentation requirements.
- Gather required documentation: You will typically need proof of identity, proof of state residency, Social Security numbers for all household members, documentation of income (pay stubs, tax returns, or self-employment records), and information about other health insurance coverage you may have.
- Submit and wait for determination: States are required to process most Medicaid applications within 45 days. Disability-based applications may take up to 90 days. You will receive written notice of approval or denial.
- Appeal if denied: If your application is denied, you have the right to request a fair hearing. The denial notice will include instructions on the appeals process and deadlines.
Medicaid vs. Medicare: key differences
Medicaid and Medicare are both government health programs, but they serve different populations and operate very differently. Understanding the distinction prevents confusion when assessing coverage options.
| Feature | Medicaid | Medicare |
|---|---|---|
| Who qualifies | Low-income individuals and families | Adults 65+, and people with qualifying disabilities |
| Funding | Joint federal and state funding | Federal funding only |
| Income test | Yes — income determines eligibility | No income test for most coverage |
| Cost to enrollee | Free or very low-cost premiums | Part B premiums required; Part A often premium-free |
| Long-term care coverage | Yes, for eligible low-income individuals | Limited — covers only short-term skilled nursing care |
| Administration | State-administered within federal guidelines | Federally administered |
Some individuals qualify for both Medicaid and Medicare. These “dual-eligible” beneficiaries receive coordinated coverage — Medicare pays first, and Medicaid covers some or all of the remaining cost-sharing, including premiums, deductibles, and copays.
Good to know: Medicaid coverage is retroactive in most states. If you apply for Medicaid and are approved, coverage can begin as far back as the first day of the month that was three months before you applied, as long as you would have been eligible during that period. This retroactive coverage can cover medical bills you have already incurred, which makes applying promptly after a qualifying change in income or circumstances especially valuable.
Frequently asked questions
What income is counted for Medicaid eligibility?
For most non-elderly adults, Medicaid uses Modified Adjusted Gross Income (MAGI), which includes wages, salaries, self-employment income, Social Security income, and most other income types. It excludes certain items like child support received and some Native American tribal income. For elderly and disabled applicants, income is measured under a different, pre-ACA methodology that may treat income sources differently than MAGI.
Can I qualify for Medicaid if I have a job?
Yes. Having a job does not disqualify you from Medicaid. Eligibility is based on household income relative to the federal poverty level, not employment status. A part-time or full-time worker whose income falls below the applicable Medicaid threshold can qualify. In expansion states, a single adult earning up to approximately $20,000 per year (138% FPL in 2025) qualifies for adult Medicaid.
Does Medicaid cover dental care?
Federal law requires Medicaid to cover dental care for children. For adults, dental coverage is optional and states make their own decisions. Some states provide comprehensive adult dental coverage through Medicaid; others offer emergency services only; a handful provide no adult dental coverage at all. Check your state’s Medicaid dental coverage directly through your state agency’s website.
Can I have Medicaid and private insurance at the same time?
Yes. Medicaid can coordinate with employer-sponsored insurance or individual market coverage. When you have both, private insurance pays first (as the primary payer), and Medicaid pays second, covering some or all of the remaining cost-sharing. Medicaid will not pay a premium for private insurance unless the state has determined it is cost-effective to do so under premium assistance programs.
Related reading on health coverage and assistance programs
- Medicaid — a broader overview of how the Medicaid program is structured, what it covers, and how it interacts with other federal health programs.
- Marketplace health insurance — ACA exchange coverage that serves as an alternative for those who do not qualify for Medicaid but need individual market insurance.
- Out-of-pocket maximum — Medicaid typically has very low or zero cost-sharing for enrollees, making the out-of-pocket structure very different from private insurance.
- Adjusted gross income — the income figure used as the starting point for calculating MAGI, which drives Medicaid eligibility for most non-elderly adults.
Key takeaways
- Medicaid eligibility is based on income, assets, household size, and categorical factors — rules vary significantly by state.
- In the 41 states that expanded Medicaid under the ACA, adults with household income up to 138% of the federal poverty level qualify.
- Asset tests apply primarily to elderly and disabled applicants, particularly for long-term care coverage. Most non-elderly adults face no asset test.
- A five-year lookback period applies for long-term care Medicaid, penalizing asset transfers made below fair market value within five years of application.
- Coverage is retroactive — approval can extend back three months before the application date if the person was eligible during that period.
- Dual-eligible individuals who qualify for both Medicaid and Medicare receive coordinated coverage, with Medicaid covering much of the cost-sharing that Medicare leaves unpaid.
For guidance on health insurance options, compare plans and providers at SuperMoney’s health insurance reviews.
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