Medicaid is both federal and state, but your state runs the program

Medicaid is a partnership between the federal government and your state. The federal government sets the basic rules and pays a share of the cost. Your state decides who gets coverage, what services are covered, and how much doctors and hospitals are paid. This means the program you have access to depends on where you live.

The federal government requires states to cover certain groups — children, pregnant people, parents of dependent children, and people over 65 — but states can cover more people if they choose. Some states cover more income levels or more types of services than others. A person who would get Medicaid in one state might not in another.

Key Takeaways

  • The federal government funds part of Medicaid and sets minimum coverage rules; your state government runs the actual program and decides who gets coverage.
  • Income limits, covered services, and payment rates to doctors vary by state, so you need to check your specific state's rules, not national ones.
  • Your state Medicaid agency is the body that determines whether you meet the rules and processes your paperwork.
  • The federal government can change how much money it gives states, which sometimes forces states to cut coverage or tighten income limits.

What the federal government controls

The federal government sets the floor — the minimum that every state must do. It requires states to cover certain groups of people: children under 19, pregnant people, parents of dependent children, people over 65, and people who are blind or disabled. It also sets rules about how states must process paperwork, how quickly they must make decisions, and what rights people have if they are denied coverage.

The federal government also pays a percentage of the cost. That percentage varies by state and is based on the state's average income. Poorer states get a higher federal match — sometimes 75 percent or more. Wealthier states get a lower match — sometimes 50 percent. This means the federal government always pays something, but states always pay something too.

What your state controls

Your state decides who beyond the federal minimum gets coverage. Some states cover people with higher incomes than others. Some states cover people who are not in the federal minimum groups — for example, childless adults or people over 65 who do not yet may have access to for Medicare. Some states do not cover these groups at all.

Your state also decides what services are covered. All states must cover doctor visits, hospital stays, and emergency care. But states can choose whether to cover dental care, vision care, hearing aids, mental health services, or substance use treatment. Some states cover all of these; some cover none. Your state also sets how much it pays doctors and hospitals, which affects how many providers will accept Medicaid.

Your state runs the day-to-day program. It has a Medicaid agency — usually part of the Department of Human Services or Department of Health and Human Services — that takes your paperwork, verifies your income and household size, makes the decision about whether you get coverage, and sends you a card or notice. If you are denied, you appeal to that state agency, not to the federal government.

How the federal government funds Medicaid

The federal government does not give states a fixed amount of money each year. Instead, it pays a percentage of whatever the state spends on Medicaid. If a state spends more, the federal government pays its share of that more. If a state spends less, the federal government pays less. This is called an open-ended match.

The federal match percentage is set by law and changes only when Congress acts. During the COVID-19 pandemic, Congress temporarily increased the federal match so states would not lose money. When that temporary increase ended in 2023, many states had to cut coverage or tighten income limits because they could no longer afford to cover as many people.

Why your state's rules matter more than federal rules

When you are trying to understand whether you can get Medicaid, your state's rules are what matter. The federal minimum is a floor, not a ceiling. Your state can do more, and many do. But your state can also do the minimum and nothing more.

This is why you cannot look up a national income limit for Medicaid. There is no single national limit. Your state has its own limit for each group of people — one for children, one for pregnant people, one for parents, one for people over 65. A family of three with $2,000 a month in income might get Medicaid in one state and be over the limit in another.

The same is true for services. If you need dental work or mental health care, you need to know whether your state covers it. The federal government does not require it, so some states do and some do not.

How to find your state's specific rules

Your state Medicaid agency has a website with income limits, covered services, and the application process. The name of the agency varies by state — it might be called Medicaid, Medical Assistance, MediCal, or something else. You can find it by searching "[your state] Medicaid" or by calling 211, which is a free referral line that connects you to local programs.

You can also contact your state agency directly. They can tell you whether you meet the income and household rules, what documents you need to bring, and how long the process takes. They can also tell you which doctors and hospitals accept Medicaid in your state, because that varies too.

What happens when federal rules change

When Congress passes a new law about Medicaid, it sets a new rule that all states must follow. For example, Congress has required states to cover certain preventive services at no cost to the patient, and to cover certain groups of people. But Congress does not always give states money to pay for the new requirement. States sometimes have to cut other services or tighten income limits to pay for the new federal rule.

States can also ask the federal government for a waiver — permission to do something different from the federal rule. For example, a state might ask to cover a smaller group of people, or to charge patients a copay for a service that the federal rule says should be free. The federal government can say yes or no. If it says yes, that state can do something different from other states.

Frequently Asked Questions

Can I use my Medicaid card from one state if I move to another state?

No. Medicaid is state-run, so your coverage ends when you move. You must apply for Medicaid in your new state. Your new state has its own income limits and covered services, so you might not get coverage even if you had it in your old state. Contact your new state's Medicaid agency as soon as you move.

If the federal government pays for Medicaid, why do I have to follow state rules?

The federal government pays part of the cost and sets minimum rules, but it does not run the program. Your state runs it. States have the power to decide who gets coverage and what is covered, as long as they meet the federal minimum. This is why the program is different in every state.

What if my state cuts Medicaid coverage because the federal match went down?

If your state cuts coverage, you might lose Medicaid even though you did not change anything. Your state might raise income limits, cut services, or remove people from the program. If this happens to you, ask your state Medicaid agency what other programs might help — some states have separate programs for people who lose Medicaid.

Does the federal government ever override a state's Medicaid decision?

Rarely. The federal government can audit a state's Medicaid program and require it to follow federal rules, but it does not usually overturn individual decisions. If you are denied Medicaid, you appeal to your state agency. The federal government gets involved only if your state is not following federal law.