Jane Dotson
Medicaid is a key source of coverage for certain populations in the United States, including children, adults in poverty, and racial minorities. It is possible for Medicaid beneficiaries to have one or more additional sources of coverage for healthcare services. When Medicaid benefits supplement another coverage source, such as Medicare or private insurance, it is referred to as wrap-around coverage. In such cases, providers who accept Medicaid payments may charge cost-sharing for services covered by both sources, but only up to allowable Medicaid amounts. This complex interaction between Medicaid and other payers is an important consideration when determining how to make Medicaid one's primary insurance.
| Characteristics | Values |
|---|---|
| What is Medicaid? | A health care system, covering 19% of all health care spending and 19% of hospital spending. |
| Who is it for? | Low-income individuals and families, with a higher percentage of Black, Hispanic, and American Indian or Alaska Native (AIAN) children and adults. |
| What does it cover? | Services required by federal Medicaid law, prescription drugs, home care, non-emergency medical transportation, and comprehensive benefits for children (Early Periodic Screening Diagnosis and Treatment). |
| How does it interact with other payers? | Medicaid can be the primary or secondary payer, depending on other sources of coverage. It often acts as the payer of last resort under third-party liability (TPL) rules. |
| Can I have Medicaid and private insurance? | Yes, it is possible to have Medicaid and private health insurance. However, coordination of benefits and TPL rules apply. |
| How do I enroll? | Enrollment processes vary by state. Contact your state's Medicaid agency or visit their website for specific instructions. |
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What You'll Learn
Medicaid and other insurance
Medicaid is a key source of coverage for certain populations in the United States, including children, adults in poverty, and racial minority groups. It is possible for Medicaid beneficiaries to have one or more additional sources of coverage for healthcare services. This is referred to as Third-Party Liability (TPL), where third parties such as individuals, entities, insurers, or programs are legally obligated to pay part or all of the medical expenditures under a Medicaid state plan.
When Medicaid benefits supplement another coverage source, such as Medicare or private insurance, it is known as wrap-around coverage. In such cases, providers who accept Medicaid payments may charge cost-sharing for services covered by both sources, but only up to allowable Medicaid amounts. However, providers are prohibited from charging cost-sharing to beneficiaries for certain Medicare services provided to individuals dually eligible for Medicare and Medicaid.
States play a crucial role in coordinating benefits and third-party liability. They are required to ascertain the legal liability of third parties to pay for care and services under the Medicaid state plan. States conduct data matches with public entities, such as the Department of Defense, to identify enrollees with coverage through the Military Health Services system or the TRICARE program. Additionally, states match with workers' compensation and state motor vehicle accident files to identify injuries that may be covered by workers' compensation or automobile insurance.
Medicaid interacts with other payers when beneficiaries have other sources that are legally liable for their medical costs. For example, the majority of Medicaid enrollees receive benefits through managed care plans, which contract directly with states and must comply with Medicaid-specific requirements. In contrast, under premium assistance programs, states may pay for private market coverage designed for a non-Medicaid population.
While it is possible to have Medicaid and private health insurance, children with private insurance cannot qualify for the Children's Health Insurance Program (CHIP). Additionally, enrollees with commercial managed care coverage are excluded from enrollment in Medicaid Managed Care Organizations (MCOs). However, states may contract with MCOs to provide healthcare to Medicaid beneficiaries, delegating certain responsibilities and authorities to these organizations.
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Medicaid and Medicare
Medicaid is a key source of coverage for certain populations in the United States, with 1 in 5 people covered by the program. It is the primary payer for long-term care in the US, covering 61% of total spending. Medicaid covers nearly 4 in 10 children, over 8 in 10 children in poverty, 1 in 6 adults, and almost half of adults in poverty. It also covers a higher proportion of Black, Hispanic, and American Indian or Alaska Native (AIAN) children and adults compared to White children and adults.
Medicaid interacts with other payers when beneficiaries have other sources that are legally liable for payment of their medical costs. These may include private insurance, Medicare, or other programs. When Medicaid benefits supplement another coverage source, it is often referred to as wrap-around coverage. In these cases, providers who accept Medicaid payment may charge cost sharing for services covered by both sources, but only up to allowable Medicaid amounts.
By law, all other available third-party resources must meet their legal obligation to pay claims before the Medicaid program pays for the care of an eligible individual. States are required to ascertain the legal liability of third parties to pay for care and services under the Medicaid state plan. This coordination of benefits (COB) involves determining Medicaid benefits when an enrollee has coverage through an individual, entity, insurance, or program that is liable to pay for healthcare services.
In some cases, Medicaid may make arrangements for private plans and other entities to pay providers for Medicaid-covered services. For example, many Medicaid enrollees receive benefits through managed care plans, which contract directly with states. States may also pay for private market coverage designed for a non-Medicaid population through premium assistance programs.
Medicaid provides benefits not usually covered by health insurance, such as non-emergency medical transportation and comprehensive benefits for children, known as Early Periodic Screening Diagnosis and Treatment (EPSDT) services. Medicaid also covers prescriptions, dental care, and home care, which is long-term care provided in non-institutional settings like homes, day care centers, and assisted living facilities.
Medicaid beneficiaries can have one or more additional sources of coverage for healthcare services. For example, children can have both Medicaid and private health insurance, but those with private insurance cannot qualify for the Children's Health Insurance Program (CHIP). Similarly, Medicare-Medicaid Coordinated Plan participants are not eligible for certain benefits, such as the Home Care for Certain Disabled Children Program (Katie Beckett).
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Medicaid for children
Medicaid is a health insurance program that provides coverage for a range of medical services, including doctor visits, hospital stays, prescription drugs, and more. It is a federal and state program that provides health coverage for millions of people, including children, who might otherwise be unable to afford it.
In some cases, Medicaid can serve as a secondary insurance for children who already have private health insurance. This is known as "wrap-around coverage," where Medicaid supplements the benefits provided by the primary insurance plan. However, it is important to note that children with private health insurance are not eligible for the Children's Health Insurance Program (CHIP), which is a separate program from Medicaid.
To apply for Medicaid for your child, you can start by visiting the official Medicaid website or your state's Medicaid agency website. These websites provide information on eligibility requirements, application processes, and the range of benefits offered. You may also need to provide documentation, such as proof of income, residency, and your child's age, to support your application.
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Medicaid and private health insurance
Medicaid beneficiaries can have one or more additional sources of coverage for healthcare services. These additional sources of coverage are referred to as Third Party Liability (TPL) and include private insurance, Medicare, other public programs such as the Ryan White program, workers' compensation, and amounts received for injuries in liability cases. In most cases, these third parties are legally liable for payment of the beneficiary's medical costs before the Medicaid program pays for the care of an individual eligible for Medicaid.
When Medicaid beneficiaries have other sources that are liable for their medical costs, it is referred to as wrap-around coverage. Providers who accept Medicaid payment for beneficiaries with another coverage source may charge cost sharing for services covered by both sources, but only up to allowable Medicaid amounts. However, providers are prohibited from charging cost sharing for Medicare Part A and Part B services provided to certain individuals who are dually eligible for Medicare and Medicaid.
Coordination of Benefits (COB) refers to the activities involved in determining Medicaid benefits when an enrollee has coverage through an individual, entity, insurance, or program that is liable to pay for healthcare services. States are required to gather information about other sources of health coverage and periodically update this information. States also conduct data matches to identify third-party resources, including public entities such as the Department of Defense and workers' compensation.
Medicaid costs per beneficiary are substantially lower than for private insurance, and research has shown that costs for Medicaid grew more slowly than for private insurance between 1987 and 2017. Medicaid also provides more comprehensive benefits than private insurance at a significantly lower out-of-pocket cost to beneficiaries. For example, adults on Medicaid cost about 22% less than if they were covered by private insurance.
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Medicaid in different states
Medicaid is a federal-state program that offers free or low-cost medical benefits to eligible low-income individuals, families, children, pregnant women, the elderly, and people with disabilities. The program is jointly administered by the states and the federal government, with each state having its own eligibility requirements, application process, and benefits package. As a result, the specific steps to make Medicaid your primary insurance may vary depending on the state you reside in.
In general, to make Medicaid your primary insurance, you must first determine your eligibility and then apply through your state's Medicaid agency. Each state sets its own eligibility criteria, which typically include income and resource limits, residency requirements, and other factors. You can find your state's specific eligibility requirements and application process by visiting its official website or contacting its Medicaid agency directly.
While the specific application process may vary by state, here are some common steps:
- Create an account: You may need to create an account with your state's Health Insurance Marketplace or its official Medicaid website.
- Complete the application: Fill out the Medicaid application form, providing the required documentation and information, such as income details, household information, and existing insurance coverage.
- Wait for a response: After submitting your application, your state agency will review it and contact you regarding enrollment or request additional information. The processing time can vary, typically ranging from 15 to 90 days.
- Enrollment and coverage: If you are eligible, your state agency will enrol you in Medicaid and provide information about your coverage, benefits, and any additional steps required.
It is important to note that Medicaid coverage is typically state-specific, and you cannot transfer your coverage from one state to another. If you relocate to a different state, you will need to terminate your original Medicaid coverage and reapply in your new state. Most states offer Retroactive Medicaid coverage, allowing you to receive benefits for up to three months prior to your application month.
- New York and Florida: In 2025, New York allowed a higher countable asset limit of $32,396 for Medicaid beneficiaries, while Florida had a much lower limit of $2,000 for long-term care Medicaid and $5,000 for Regular Medicaid.
- California: As of January 1, 2024, California eliminated its asset limit for Medicaid (Medi-Cal), allowing applicants to have unlimited assets.
- Texas and Nevada: These states require individuals to reside in a nursing home for 30 continuous days before they can apply for Nursing Home Medicaid.
- States with expanded Medicaid: Under the Affordable Care Act, 41 states have expanded Medicaid, leading to higher rates of coverage. These states tend to have higher percentages of Medicaid enrollees compared to non-expansion states.
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Frequently asked questions
If you are referring to how to enrol in Medicaid as your primary insurance, you will need to check your eligibility and apply. Eligibility depends on your income, family size, and state. You can apply for Medicaid through your state agency or the Health Insurance Marketplace.
Yes, it is possible to have multiple sources of coverage. This is known as Third-Party Liability (TPL) or wrap-around coverage. In this case, the other insurance providers are legally liable for payment before the Medicaid program.
Medicaid covers a range of services, including prescriptions, dental care, non-emergency medical transportation, and long-term care. It also provides comprehensive benefits for children, known as Early Periodic Screening Diagnosis and Treatment (EPSDT) services.
