Medicaid

Medicaid was authorized by Title XIX of the Social Security Act in 1965 as a jointly funded cooperative venture between the Federal and State governments to assist States in the provision of adequate medical care to eligible needy persons. Within broad Federal guidelines, each of the States establishes its own eligibility standards; determines the type, amount, duration, and scope of services; sets the rate of payment for services; and administers its own program. 

Medicaid is the largest program providing medical and health-related services to America's poorest people. However, Medicaid does not provide medical assistance for all poor persons. Under the broadest provisions of the Federal statute, Medicaid does not provide health care services even for very poor childless persons unless they are disabled.  Except as noted, all States must provide Medicaid coverage to:
Individuals who meet the requirements for the Aid to Families with Dependent Children (AFDC) program that were in effect in their State on July 16, 1996, or, at State option, more liberal criteria (with some exceptions).
Children under age 6 whose family income is at or below 133 percent of the Federal poverty level.
Pregnant women whose family income is below 133 percent of the Federal poverty level (services to these women are limited to those related to pregnancy, complications of pregnancy, delivery, and postpartum care).
Supplemental Security Income (SSI) recipients in most States (some States use more restrictive Medicaid eligibility requirements that predate SSI).
Recipients of adoption or foster care assistance under Title IV Part E. of the Social Security Act.
Special protected groups (typically individuals who lose their cash assistance due to earnings from work or from increased Social Security benefits, but who may keep Medicaid for a period of time).
All children born under age 19 and in families with incomes at or below the Federal poverty level.
Certain Medicare beneficiaries (low income is only one test for Medicaid eligibility for those within these groups; their resources also are tested against threshold levels, as determined by each State within Federal guidelines).

States also have the option of providing Medicaid coverage for other "categorically related" groups.

Medicaid operates as a vendor payment program. States may pay health care providers directly on a fee-for-service basis, or States may pay for Medicaid services through various prepayment arrangements, such as health maintenance organizations (HMOs) or other forms of managed care. Within Federally imposed upper limits and specific restrictions, each State for the most part has broad discretion in determining the payment methodology and payment rate for services. Thus, the Medicaid program varies considerably from State to State, as well as within each State over time.

SOURCE: Health, United States

Related Links
Health Expenditures, National
Health Maintenance Organization (HMO)
Medicare

This page last reviewed September 10, 2008