Medicaid is a state-run program that provides health insurance to some US citizens with limited income and resources.
Some states offer Medicaid to adults based solely on income; other states limit Medicaid to pregnant women, children and seniors.
If your income and resources are too high for Medicaid, you may be able to “spend down” by spending your money on medical bills until you reach your state’s threshold. When you do, you may be temporarily eligible for Medicaid.
Dual eligible means you qualify for both Medicare and Medicaid. If you’re eligible, Medicare will pay to cover its portion of your medical bills first and then Medicaid pays for most or all of the rest.
Need to know how to apply for Medicaid? If you or a loved one are looking to tap into this program for Americans with limited incomes, there are some crucial details to understand who qualifies and how to enroll.
First things first: Medicaid is not the same thing as Medicare. While they both receive funding from the federal government to provide health insurance for Americans, they’re two separate programs that operate very differently. How you apply for Medicaid is separated from the steps you’d take for Medicare. Because they’re different programs, there are even times you may qualify for both programs at once.
To further complicate the topic, each state-run Medicaid system has its own qualifications and benefits. That can make answering the question, “How to apply for Medicaid?” a bit complicated. To help explain further, here’s an overview of who’s eligible for Medicaid and how to sign up.
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According to projections, more than 72 million Americans are enrolled in Medicaid. [i] Medicaid has traditionally provided health insurance benefits to people with low incomes, generally including
- Families and kids
- Pregnant women
- People with disabilities
- The elderly
The eligibility standards for those groups depend on their state’s Medicaid rules. Some states require that Medicaid beneficiaries not just have low incomes but also meet specific disability standards. Others offer Medicaid benefits to all residents below a certain income threshold. This is referred to as expanded Medicaid.
Where do I go to apply for Medicaid?
No matter where you live, there are generally two ways to apply for Medicaid: through your state’s Medicaid office and online through Healthcare.gov. Since each state has its own Medicaid system, they also have their own administrative offices where you can meet with officials and apply for benefits. If you need in-person help, visiting your local Medicaid branch is a great option.
Healthcare.gov is the online marketplace for health insurance plans offered through the Affordable Care Act (ACA). You can apply for Medicaid and other cost-saving health insurance programs. If you’re eligible for Medicaid, you’ll be contacted by your state’s agency to discuss your available benefits and options. [i]
Which documents do I need to apply for Medicaid?
To apply for Medicaid, you’ll need to verify a few facts about yourself. While qualification standards are different in each state, you’ll typically need to provide:
- A birth certificate and/or driver’s license to verify your identity and age
- Other proof of citizenship (if needed)
- Bank statements showing your current income and resource levels
- Copies of your mortgage or lease or utility bills to prove your place of residence
- Documentation of your medical disability (if needed)
The list above is a starting point; because each state has its own Medicaid system, the requirements can change from state to state. Call your local office to precisely determine what you’ll need to provide before you apply for Medicaid. If you don’t qualify for your state’s Medicaid program, don’t let a lack of preparation be the reason you get denied for coverage.
As they say, the answer here is all about location, location, location. Some states offer Medicaid coverage to all adults and children if they meet certain income requirements. Oregon, for example, offers expanded Medicaid services to adults that earn within 133% of the Federal Poverty Level. On the other hand, Alabama reserves Medicaid benefits to low-income children, pregnant women, and adults with disabilities. Alabama does not offer Medicaid to adults based solely on their income. [i]
Qualifying for Medicaid in states without expanded Medicaid services can be more difficult. Often these states will restrict eligibility to low-income adults who also have a disability. Talk to your local Medicaid office to see if you qualify and, if not, what other options you may have.
What is a “Spend Down” period?
Having an income too high can disqualify you from Medicaid. But if you get hit with significant medical bills, you may be able to qualify temporarily by deducting those bills from your income. This is known as a Medicaid Spend down period.
Each state has requirements for Medicaid. Many stick to a standard income and asset limit or $2,000 for individuals and $3,000 for couples. Some states have significantly higher limits up to $10,000 and $15,000, respectively. [i] Qualified beneficiaries can pay their medical bills out-of-pocket until their income falls to their state’s limit. They’ll then receive Medicaid coverage for the length of time their state allows. This is typically one to six months. You may qualify for Medicaid longer but will have to reapply after your state’s monthly Spend down period is over. For example, a person in a one-month state will need to Spend down their income each month to continue their eligibility; in six-month states, a successful Spend down can mean you’re eligible for a half year’s worth of coverage. [i]
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As we mentioned, each state’s Medicaid system has its requirements and benefits. If you have a low income, where you live will have a significant impact on receiving Medicaid benefits. And if you move after you qualify for your state’s Medicaid benefits, they’ll likely change if you relocate to a new state.
The good news? You can find each state’s Medicaid program requirements online. Knowing whether or not you qualify will let you know what benefits you can expect and which you’ll need to find somewhere else. Here’s a list of all 50 states and a link to where you can find more information about their Medicaid programs.
Medicare and Medicaid are two different programs. Medicaid is an assistance program designed to provide health insurance to U.S. citizens that can’t afford it. If you qualify for Medicaid, you won’t pay for most of the covered medical services you receive.
Medicare is health insurance for legal U.S. citizens aged 65 and older. There are two primary forms of Medicare to choose from, Original Medicare (Parts A and B) or a Medicare Advantage Plan (Part C). Each has monthly and out-of-pocket costs you’ll need to pay, which is a big difference from Medicaid.
- Original Medicare offers hospital (Part A) and medical (Part B) coverage. Many enrollees qualify for no-cost Part A premiums but generally must pay Part A’s deductible and coinsurance, as well as Part B’s premium, deductible and out-of-pocket costs. Beneficiaries also must add Medicare Prescription Drug Plan (Part D) separately if they need medications. Part D has its own costs.
- Medicare Advantage (Part C) replaces Original Medicare (Part A & B), but offers the same Part A and B benefits or coverage as Original Medicare. Along with receiving Part A and B benefits, Medicare Part C often bundles additional services like dental, hearing, vision and prescription drug coverage. Part C plans often have different, and even lower, monthly premiums and out-of-pocket costs than Original Medicare.
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You can; this is known as being dual-eligible. If you qualify, Medicare will first cover its portion of your medical bills before Medicaid pays what is not covered. This can include premiums, deductibles, coinsurance, and even long-term care.
Like Medicaid and Medicare, your eligibility will be based on your income. If you qualify, there are several programs that can help pay for some or all of your healthcare costs, including:
- Part A and B premiums
- Part B deductible, copayments and coinsurance
- Part D premiums and deductibles
How can you have Medicare and Medicaid if you’re already enrolled in one of the two programs? Fortunately, you don’t need to sign up for them at the same time; to be dual-eligible, you can either be enrolled first in Medicare before applying for Medicaid, or you can be enrolled in Medicaid before you turn 65 (if you qualify), then add Medicare coverage.