About Medicaid for Children and Families
Introduction
Enacted in 1965 under Title XIX of the Social Security Act, Medicaid
was initially created to provide medical assistance to individuals and
families receiving cash assistance. Today, Medicaid provides health
coverage for millions of individuals who have no ties to cash
assistance, including children in low-income families who lack access
to private health insurance and on a smaller scale, their parents.
This primer provides a very general overview of the program rules
relating to children. Links to more detailed information are provided
in the
Resources section. Also
download a guide on Medicaid terms.
Structure
States administer Medicaid subject to oversight by the federal
government. Federal law outlines broad requirements that all state
Medicaid programs must fulfill. However, states have wide discretion
regarding program dimensions such as eligibility and service delivery
systems. All children and parents who apply for and qualify for
Medicaid are guaranteed coverage. A state cannot cap enrollment or
create a waiting list in Medicaid.
Eligibility
To qualify for Medicaid, children must meet certain eligibility rules. These include:
Income
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State Medicaid programs must cover certain “mandatory”
populations, including children under age 6 with family incomes below
133% of the federal poverty level (FPL) and children ages 6-18 with family incomes below 100%
of the FPL (see federal poverty guidelines).
States, however, have broad flexibility to expand Medicaid eligibility
beyond the federal minimum standards. States can also establish an
asset or resource requirement for children, but they have the option to
eliminate it.
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Age
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States must cover children up to 18 years of age. States have the option to cover 19 and 20 year olds.
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Insurance Status
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Children generally do not have to be uninsured to
obtain Medicaid coverage. Any private insurance an individual has is
treated as a third party payer and is liable for the cost of care
provided to the individual under the terms of the private plan.
Medicaid "wraps around" the private insurance, providing care that
otherwise would be uncovered and keeping cost sharing charges to the
level allowed in Medicaid.
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Citizenship/
Immigration Status
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Medicaid covers citizens and certain legal immigrants.
States have the option of covering lawfully present
immigrant children who have not been in the country for five years
(with exceptions for refugees). Federal funds may not be used to cover undocumented children (except
for emergency or pregnancy-related services). Some states use state funding to
provide coverage to children regardless of immigration status.
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Renewal
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Federal law generally requires states to review
eligibility circumstances at least every 12 months. States can either
review eligibility when financial circumstances change or they can
enroll children for periods of up to 12 months, regardless of changes
in income, through a continuous eligibility option.
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Documentation
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States have discretion in requiring families to provide documentation of income or other eligibility requirements. The only eligibility criteria that federal law requires families to document is immigration status and citizenship status (unless the state implements an option to use electronic means for documenting citizenship). In addition, states are responsible for checking the accuracy of information through administrative means if it is not documented by families.
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Parents and Adults
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States must provide coverage to pregnant women with
family incomes below 133% of the FPL and parents with
incomes below states’ July 1996 welfare eligibility levels (often below
50% of the FPL). States have discretion to provide
coverage to these groups above the minimums. Adults who are not
disabled, pregnant, or elderly, and have no minor children generally
cannot qualify for Medicaid. |
Financing
The federal government matches state spending on Medicaid on an
open-ended basis. The federal matching rate can range from 50%
to 76%, depending on a state’s per capita income. States with
higher per capita incomes have a lower federal matching rate. See
federal matching rates.
States can also receive a performance bonus for implementing enrollment and renewal strategies and increasing Medicaid enrollment for children. The size of the payment can vary from 15% to 62.5% of the average cost to a state of covering a child, depending upon the extent to which a state's enrollment exceeds target levels.
Benefits
States must provide children with a comprehensive benefit package,
although for other populations they have substantial flexibility to
design their benefit packages subject to certain minimum requirements.
For adults, states must provide “mandatory services,” which include
hospital care and physician services.
States also have the option to
cover additional services, such as prescription drugs. In all cases the
scope of the services covered must be sufficient to generally meet the
needs of enrollees.
Medicaid guarantees comprehensive services for children through Early
and Periodic Screening, Diagnosis, and Treatment (EPSDT). EPSDT is
intended to assure a uniform federal benefit package for children,
covering screening and early intervention services to promote
children’s healthy development, as well as vision, dental, and hearing
services, and the diagnostic and treatment services that a child may
need.
The scope of benefits and the standards for accessing benefits
often exceeds those that exist in the private insurance market.
Nonetheless, most children in Medicaid do not require extensive
services; children are by far the least expensive group covered by the
program, costing, on average, $1,543 per child, compared to $2,215 per
adult, $10,159 per disabled enrollee, and $11,705 per elderly enrollee.
In addition, although children and their parents make up the majority
of the Medicaid population, they account for less than 40 percent of
federal Medicaid spending (Congressional Budget Office, March 2009).
For more information see:
Benefits That Make A Difference: Comparing Medicaid and the State Children's Health Insurance Program Federal Benefit Standards, October 2005.
Cost Sharing
States may impose cost sharing for some children enrolled in Medicaid,
within federal guidelines. Except for “mandatory children” a state may
impose premiums for children, with some limitations based on family
income. Co-payments are also allowed, with some restrictions for
children with family incomes up to 150% of the federal poverty level.
States cannot count money raised through premiums or cost sharing as
state dollars for the purposes of meeting the federal matching
requirements.
For more information see:
Cost Sharing for Children and Families.
Research has shown that premiums in Medicaid and CHIP depress
enrollment because of the financial burden they impose on families,
potentially increasing the number of uninsured children. For more
information see:
Resources
Additional resources on Medicaid are available in the Research section. Also see Facts & Statistics for eligibility and program rules by state.
- Building on a Solid Foundation: Medicaid's Role in a Reformed Health Care System
Vikki Wachino, Cindy Mann, and Martha Heberlein, Center for Children and Families
March 2009
- Challenges of Providing Health Coverage for Children and Parents in a Recession
Donna Cohen Ross and Caryn Marks, Kaiser Commission on Medicaid and the Uninsured
January 2009
- Medicaid: A Primer
Kaiser Commission on Medicaid and the Uninsured
December 2008
- Health Coverage of Children: The Role of Medicaid and SCHIP
Kaiser Commission on Medicaid and the Uninsured
November 2008
- Medicaid's Role for Women
Kaiser Commission on Medicaid and the Uninsured
November 2007
- As Tough Times Wane, States Act to Improve Medicaid Coverage and Quality: Results from a 50-State Medicaid Budget Survey
Vernon Smith, et al. , Kaiser Commission on Medicaid and the Uninsured
October 2007
- Medicaid Enrollment in 50 States: December 2006 Data Update
Eileen Ellis, Dennis Roberts, David Rousseau, and Karyn Schwartz, Kaiser Commission on Medicaid and the Uninsured
October 2007
- Medicaid at the Ten-Year Anniversary of SCHIP: Looking Back and Moving Forward
Lisa Dubay, Jocelyn Guyer, Cindy Mann, and Michael Odeh, Health Affairs
March 2007
- Medicaid: A Primer
Elicia Herz, Congressional Research Service
January 2007
- The Role of Medicaid and SCHIP as an Insurance Safety Net
Stephen Zuckerman and Allison Cook, Urban Institute
August 2006
- A Success Story: Closing the Insurance Gap for America's Children through Medicaid and SCHIP
Cindy Mann, Jocelyn Guyer, and Joan Alker, Center for Children and Families
July 2005
- Medicaid Resource Book
Andy Schneider, Kaiser Commission on Medicaid and the Uninsured
July 2002
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