Chelsey Tucker graduated with a Bachelor of History degree from Metropolitan State University in 2019. She now writes about insurance with her specialty being life insurance and has been quoted on Help Smart Phone and MEL Magazine.

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Dan Walker graduated with a BS in Administrative Management in 2005 and has been working in his family’s insurance agency, FCI Agency, for 15 years. He is licensed as an agent to write property and casualty insurance, including home, auto, umbrella, and dwelling fire insurance. He’s also been featured on sites like Reviews.com.

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Reviewed by Daniel Walker
Licensed Auto Insurance Agent

UPDATED: Mar 19, 2020

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The lowdown...

  • Under the Affordable Care Act, states had the option to expand their Medicaid program and offer coverage to more Americans
  • In states that expanded Medicaid, you can qualify for coverage based on your income alone
  • You should apply even if your state has not expanded their Medicaid program
  • If your state opts out of the Medicaid expansion, you may fall into the Medicaid coverage gap
  • If you have children, you should also consider applying for the Children’s Health Insurance Program, in addition to Medicaid

The Medicaid expansion allows states to offer Medicaid coverage to anyone with a household income below 133 percent of the federal poverty level.

In states that have not expanded their Medicaid program, people must qualify based on a variety of factors that can include the following:

  • size of the household
  • any disabilities one might have
  • family status
  • family income

Various other factors might affect eligibility in these states, as well. Due to the way eligibility for Medicaid is calculated, you might be eligible at 138 percent of the federal poverty level in some cases.

This percentage is typically equivalent to $16,142 for a single person, $21,983 for two people, and $33,465 for a family consisting of four people. Some states might have a different income limit, too.

Enter your zip code above to compare health insurance options to find the best coverage at the best rate.

How do I apply for Medicaid?

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You can apply for Medicaid coverage in one of two ways.

  • The marketplace
  • Your state Medicaid agency

You can fill out an application through the health insurance marketplace. If you qualify for Medicaid in your state, the marketplace will forward your application to your local Medicaid agency who will then contact you about the next steps for enrollment.

If you apply for Medicaid through the marketplace but do not qualify, you will still find out if you are eligible for any savings and cost-sharing assistance on marketplace plans.

If your income is between 100 and 400 percent of the federal poverty level, you should qualify for tax subsidies on a marketplace plan.

You can also apply for a marketplace plan through your state Medicaid agency. You can fill out an application for Medicaid at any time during the year and your coverage can start immediately.

There is no open enrollment period for Medicaid like there is for a typical marketplace plan.

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What happens if my state did not expand Medicaid and what is the Medicaid coverage gap?

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If your state chose not to expand their Medicaid program and you were denied coverage when you would have qualified in a state that expanded, you might not be required to get health insurance and will be exempt from the individual mandate penalty fine.

If your state did not expand Medicaid and you make less than 100 percent of the federal poverty level, you might not qualify for Medicaid or tax subsidies and cost savings on a marketplace plan.

Your income must be between 100 and 400 percent of the federal poverty level in order to be eligible for savings on a marketplace plan. This plan is known as the Medicaid coverage gap.

States that did not expand their Medicaid program include:

  • Maine
  • Wisconsin
  • Florida
  • Georgia
  • Alabama
  • Idaho
  • Kansas
  • Louisiana,
  • Michigan
  • Mississipi
  • Missouri
  • North Carolina
  • Oklahoma
  • Nebraska
  • South Carolina
  • South Dakota
  • Tennessee
  • Texas
  • Virginia
  • Utah
  • Wyoming

In order to qualify for a health insurance exemption, you must live in one of the above states, have an annual income below 138 percent of the federal poverty level, and provide proof that you were denied Medicaid coverage.

You will apply for this exemption when you file your federal tax return.

What if I am not eligible for Medicaid because my state did not participate in the expansion?

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If you are not eligible for coverage because your state did not expand their program, you should apply for a hardship exemption.

If you qualify for a hardship exemption, you will not have to pay the individual mandate penalty fine and you will most likely be eligible for a catastrophic health plan. Catastrophic plans typically have inexpensive monthly premiums but extremely high deductibles.

Catastrophic plans do not meet the minimum essential coverage requirements under the Affordable Care Act. If you do not get an exemption, you may still have to pay the individual mandate penalty fine even if you purchase a catastrophic plan.

If you enroll in a catastrophic health plan, you will have to meet your deductible amount before most of your benefits will kick in. However, your plan will still cover three primary care visits a year before you meet your deductible.

Catastrophic plans are really just meant to cover you and your family in the case of an emergency.

Deductibles on these types of plans are typically equivalent to the annual out of pocket maximum for all health insurance plans.

The maximum out of pocket cost for a single person is $6,600 and $13,200 for a family plan, so you will never have to more than this amount.

What is the Children’s Health Insurance Program?

The Children’s Health Insurance Program is another program that covers children of low-income families who may not qualify for Medicaid due to their income.

CHIP usually works closely with your state’s Medicaid program. In some states, CHIP covers pregnant women in addition to children. When you apply for Medicaid, your state agency will let you know if your children qualify for CHIP.

You can apply for CHIP in the same ways that you apply for Medicaid. Additionally, you can call the CHIP call center and speak to a representative.

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Medicaid Under Affordable Care Act

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Under the Affordable Care Act, many states expanded their Medicaid program to cover all people who have an income under 138 percent of the federal poverty level.

If your state did not expand their Medicaid program, you still have several options to obtain health insurance coverage.

Use our free rate comparison tool to help you find the health insurance you need at a rate you can afford.