Medicaid Income Limits
Medicaid income thresholds are tied to the Federal Poverty Level and vary based on your state, household size, and eligibility category. Here's how the system works.
How Medicaid income limits work
Medicaid income limits are set as percentages of the Federal Poverty Level (FPL), a standardized income measure published annually by the U.S. Department of Health and Human Services. For example, an income limit of "138% of the FPL" means your household income must be at or below 138% of the poverty guideline for your household size to qualify. Higher percentages indicate more generous eligibility.
For most Medicaid eligibility categories, income is determined using Modified Adjusted Gross Income (MAGI) methodology, which aligns with federal income tax definitions. MAGI-based Medicaid covers most non-elderly, non-disabled individuals — including the ACA expansion population, parents, pregnant women, and children.
Non-MAGI Medicaid applies to some elderly individuals and people with disabilities, particularly those seeking long-term care coverage. Non-MAGI calculations are more complex and may consider assets (such as savings accounts and property) in addition to income, often using Social Security Administration methodologies.
How the Federal Poverty Level works
The Federal Poverty Level is an income measure issued annually by HHS, used to determine eligibility for dozens of federal assistance programs. The FPL is adjusted each year in January to account for inflation. Different thresholds apply for the 48 contiguous states and DC, Alaska, and Hawaii.
Because the FPL is updated annually, specific dollar amounts become outdated quickly. For current FPL figures, check the HHS website, Healthcare.gov, or your state Medicaid agency. This guide describes how the percentage thresholds work rather than quoting specific dollar amounts, so the information remains accurate over time.
How income limits vary by eligibility group
Income limits vary significantly by eligibility group. Here are the typical ranges:
- Non-elderly adults (expansion states) — Most expansion states cover adults up to 138% of the FPL. In non-expansion states, adults without dependent children may not qualify at all, and parents often face much lower thresholds.
- Pregnant women — Income limits for pregnancy-related coverage are typically higher than for standard adult coverage — often 138% to 200% of FPL or more, depending on the state.
- Children — Children's income thresholds are usually the most generous, frequently reaching 200–300%+ of the FPL when Medicaid and CHIP eligibility are combined. Many states cover children from families with moderate incomes.
- People with disabilities — Income thresholds vary widely. Many states link eligibility to SSI eligibility (which has a very low income threshold), but others have separate, higher-income pathways for working people with disabilities.
- Seniors and long-term care — Long-term care Medicaid (nursing facility and HCBS waiver coverage) typically has much lower income limits and also imposes asset tests. Eligibility is often pegged around 300% of the SSI federal benefit rate for nursing facility care.
What counts as income
Under MAGI methodology, the following types of income generally count toward Medicaid eligibility:
- Wages and salaries from employment
- Self-employment net income
- Social Security retirement and disability (SSDI) benefits
- Unemployment compensation
- Interest and dividends
- Rental income (net of allowable expenses)
- Alimony received from divorces finalized before January 1, 2019
- Certain foreign income
The following items generally do not count toward MAGI income for Medicaid:
- Supplemental Security Income (SSI) payments
- Child support received
- Gifts and inheritances
- Loans (including student loans)
- Scholarships and grants used for tuition and education expenses
- Veterans' benefits (certain types)
- SNAP (food stamp) benefits
How household size affects the threshold
Medicaid income limits increase with household size. A family of four at 138% of the FPL has a significantly higher dollar-amount threshold than a single individual at the same percentage — because the FPL itself is higher for larger households. This is by design: the FPL accounts for the fact that larger households have greater combined financial needs.
For example, a household of one adult might qualify at an income limit well below what a family of four could earn and still qualify, even though both are at the same FPL percentage. Adding a new household member — such as a new baby — can change which FPL threshold applies, potentially shifting eligibility for the entire household. When your household size changes, it is important to report the change to your state Medicaid agency, as it can affect your eligibility and coverage level.
If your income is too high
If your income exceeds your state's Medicaid income limit, you may still have options. Some states have a Medically Needy program that allows individuals with high medical expenses to "spend down" their excess income — meaning your medical bills reduce your countable income until you reach the eligibility threshold, at which point Medicaid kicks in for additional costs.
If your children's income exceeds Medicaid thresholds, CHIP (Children's Health Insurance Program) may cover them at higher income levels with low premiums. If neither Medicaid nor CHIP applies, subsidized health insurance through the ACA Marketplace (Healthcare.gov) may be available depending on your income. A Marketplace plan with premium tax credits can significantly reduce the cost of private health insurance for individuals and families who are just over the Medicaid income limit.