What Medicaid Is
Medicaid is a health insurance program run by both the federal government and individual states. It helps pay for medical care and services for people who cannot afford to pay on their own. Unlike Medicare, which is based on age, Medicaid is based on income level. Each state runs its own Medicaid program within federal guidelines, so benefits and rules can vary from state to state.
How It Is Funded
Medicaid receives money from two sources: the federal government and the states. The federal government pays a percentage of the costs through federal taxes, while states pay the remaining percentage through their own state taxes and budgets. The exact split varies, but generally the federal government covers between 50 and 75 percent of costs depending on the state's income level and population.
Who Qualifies
Medicaid eligibility is mainly based on income, meaning people must earn below a certain amount of money to qualify. Rules differ by state, but Medicaid typically covers low-income families with children, elderly people with limited income, pregnant women, children, and people with disabilities. Each state sets its own income limits and eligibility rules within federal guidelines.
Services Covered
Medicaid covers essential health services including doctor visits, hospital care, emergency services, prescription medications, and preventive care. Many states also cover dental care, vision care, mental health services, and long-term care for elderly and disabled people. The specific services covered depend on which state you live in.
Federal vs. State Role
The federal government sets basic requirements and standards for Medicaid programs, provides federal funding, and oversees the program. States have flexibility to design their own programs, set eligibility rules, determine benefit levels, and manage day-to-day operations. This shared responsibility means Medicaid works slightly differently in each state. 
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