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Been hearing a lot about Medicaid and health reform? Here’s why you should care

Content excerpted from Health Reform: Seven Things You Need to Know Now, Consumer Reports.

Medicaid is a joint federal- and state-funded program. Currently it provides health care for 60 million low-income Americans, mostly children, pregnant women, individuals with disabilities, and elderly people who need help at home or live in nursing homes. While state eligibility rules differ quite a bit, most low-income adults under 65 cannot receive Medicaid.

You may have heard talk of the possibility of Medicaid expansion within the states. Medicaid expansion was a requirement of the health law passed in 2010, which mandated states to cover all very low-income people with their Medicaid programs, including adults without dependent children, with 90 to 100 percent of the new costs covered with federal funds. If a state refused to expand coverage, it would lose all its federal Medicaid funds. This was expected to motivate all states to agree.

The U.S. Supreme Court overturned that requirement, saying that each state can decide whether or not to expand its Medicaid program, without losing its current federal Medicaid funding. Currently, governors and legislatures across the nation are deciding if they want to expand Medicaid within their state. Some have clearly stated their desire to expand or not to expand. Others are still weighing the options.

In states that decide to expand Medicaid, many residents will become eligible as of January 1, 2014. Whether you qualify for Medicaid will depend on your income and where you live. All legal residents who earn less than $15,302 for an individual and $31,155 for a family of four can receive Medicaid. New federal eligibility standards include previously ineligible people, such as:

  • Low-income adults, with or without dependent children
  • Low-income children who lose their Medicaid benefits when they are reclassified as adults at 19 years old
  • Low-income adults with disabilities who are not eligible for Social Security Supplemental Disability Insurance (SSDI) or Supplemental Social Security (SSI)

Up to 17 million Americans were expected to gain Medicaid coverage under the new health law, but now that may fall short. If a state decides against doing the expansion, then its very-low-income residents will have no other option to get insurance under the new law. As the law stands today, if their household income is less than poverty level they can not get a discount to buy in the online marketplace.

If states don’t provide coverage for their poorest residents, hospitals and other health-care providers will have to provide more uncompensated care than anticipated and may continue to shift costs to those who have coverage. Or, other ways will need to be found to cover these costs, such as increasing local property taxes.

As states decide whether or not to expand Medicaid, the federal government is boosting funding to community health centers and increasing rates paid to primary care physicians who accept Medicaid in preparation for the growing number of newly insured people who will be seeking care.

To learn more about the Medicaid program in your state, visit Medicaid.gov.

To find out where your state currently stands on Medicaid expansion, check out this map.