Does Social Security Count as Income for Medicaid?

Medicaid is a public health insurance program, jointly funded by the federal and state governments. The federal government mandates that states provide Medicaid benefits to specific populations, known as mandatory eligibility groups. Examples of these groups are families with low income, qualified pregnant women, qualified children and recipients of Supplemental Security Income benefits. However, states administer the program, so beyond this requirement, eligibility rules vary across states. 

Medicare Benefits Solutions

Dec 4, 2020

 3 minutes read

Social Security programs

To understand how Social Security impacts Medicaid eligibility, let’s break down the different programs administered by the Social Security Administration (SSA):

  • Social Security retirement benefits.
  • Social Security Disability Insurance (SSDI).
  • Supplemental Security Income (SSI).

The federal government requires the states provide Medicaid benefits to people receiving SSI. SS retirement and SSDI recipients need to meet financial and nonfinancial eligibility requirements to enroll in Medicaid. 

Financial eligibility  

To evaluate your financial eligibility, Medicaid will review your modified adjusted gross income (MAGI). Adjusted gross income is your gross income minus allowable deductions. MAGI looks at your adjusted gross income and adds some of those deductions back. Your state may include SS retirement income and SSDI benefits in your MAGI, and this can bring you over the income level that would qualify you for Medicaid.

Nonfinancial considerations

Only United States citizens or qualified non-citizens, such as permanent legal residents, are considered for Medicaid benefits. Medicare recipients must meet the same criteria. To apply for Medicaid, go through your state agency. You must be a resident of the state under which you apply. 

Social Security, Medicare and Medicaid 

To qualify for Social Security retirement benefits you have to earn credits by working and paying Social Security taxes. Additionally, you have to be at least 62 years old to apply. Full retirement age is between 66 and 67, depending on your year of birth.

Similar to SS retirement benefits, SSDI eligibility is based on earning credits through working and paying SS taxes on those earnings. The program pays benefits to people unable to work due to a medical condition that is projected to last at least a year or lead to death. If you are under age 65, Medicare benefits will be automatic after you receive disability benefits from the SSA for two years. 

SSI is a program for people who have limited income and resources, and are either disabled, blind, or age 65 or older. Eligibility does not hinge on work history. If you are approved for SSI, you can expect to be approved for Medicaid. Medicaid can help Medicare recipients with out-of-pocket costs. People who receive both Medicaid and Medicare benefits are referred to as dual-eligible.

Resources

The official United States Medicaid website provides valuable information and links to further resources. Learn about your state’s Medicaid program at medicaid.gov/state-overviews/index.html. Review the Medicaid mandatory eligibility list at medicaid.gov/sites/default/files/2019-12/list-of-eligibility-groups.pdf. Find your state agency at medicaid.gov/about-us/contact-us/contact-your-state-questions/index.html

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