Nearly one in four Americans is covered by Medicaid, but many people seem to know little about the program. Here are the basics.
Medicaid provides health coverage for lower-income Americans, underwritten by state and federal tax dollars. The states operate Medicaid with oversight from the Centers for Medicare and Medicaid Services.
Original Medicaid covers low-income people in certain categories, including children, pregnant women, parents of dependent children, the elderly, and people with disabilities.
The Affordable Care Act expanded Medicaid eligibility to include most people who are under age 65 and who earn at or below 133 percent of the federal poverty line. Forty states and the District of Columbia have chosen to provide this expanded coverage.
Medicaid enrollment grew to a high of 94.6 million in April 2023 when states were required to maintain the “continuous enrollment” of nearly all Medicaid beneficiaries during COVID-19. That provision expired in March 2023, but states have until December 2026 to “wind down” that part of the program.
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Medicaid coverage varies from state to state, but traditional Medicaid covers basic services including hospital stays, doctor visits, and nursing home care. Medicaid’s Alternative Benefit Plan includes the essential health services covered by most private health insurance plans.
Each state sets the reimbursement rates for its Medicaid program and makes payments to providers or managed care organizations for treating beneficiaries.
The federal government then reimburses each state a certain portion of the amount it spends on Medicaid. That varies from 50 percent to 83 percent, depending on the state’s income level.
Medicaid and the related Children’s Health Insurance Program cost $896 billion in 2023. About 70 percent of that was paid by federal taxpayers. The rest was paid with state taxes.
Under the plan to implement Trump’s agenda, House Republicans intend to reduce federal spending by at least $1.5 trillion over the next 10 years.
A recently passed budget blueprint directs the House Committee on Energy and Commerce, which oversees Medicaid, to find $880 billion in cuts.
Medicaid accounts for 93 percent of the spending overseen by that committee.
Republicans say they will reduce Medicaid spending by eliminating fraud and abuse but will not cut benefits.
Democrats say the program does not contain enough fraud to produce the savings Republicans want. Democrats oppose any cuts to Medicaid.
Fraud does exist in Medicaid. One state lost an estimated $2 billion to Medicaid fraud over the past five years, a staff member in that state’s attorney general’s office told The Epoch Times.
Improper payments are a problem too. The Department of Health and Human Services reported that more than $31 billion in Medicaid payments were made improperly in 2024 alone.
Of those, more than $10 billion was paid for claims where no eligibility information was provided.
Medicaid Fraud Control Units recovered $1.2 billion in 2023, which was more than three times the amount spent on fraud enforcement efforts, according to the Office of Inspector General. Investigators said they could eliminate more fraud if more funding for enforcement activities were available.
Congress returns on April 28 to consider a budget reconciliation bill. Medicaid funding is likely to figure prominently in the discussion.
—Lawrence Wilson
