Medicaid

Medicaid was created alongside Medicare in the law signed July 30, 1965. Each state runs its own program within federal rules, and the federal government pays a share of costs that ranges from 50 percent to about 77 percent depending on state income. It covers about 70 million people, including children, pregnant women, parents, older adults, and people with disabilities. Medicaid pays for about four in ten births and is the largest payer for nursing home and other long-term care.

The Affordable Care Act extended Medicaid to nearly all adults earning up to 138 percent of the poverty line, with the federal government paying 90 percent of the cost, but the Supreme Court in NFIB v. Sebelius in 2012 made the expansion optional. Forty states and the District of Columbia have adopted it. During the pandemic states could not remove enrollees, and when that ended in 2023 and 2024 more than 25 million people were disenrolled as eligibility was rechecked.

The 2025 budget reconciliation law, signed July 4, 2025, made the largest changes in Medicaid's history. It requires most expansion adults ages 19 to 64 to show 80 hours a month of work, school, or community service starting by January 1, 2027, requires eligibility checks every six months for them, and limits the provider taxes states use to fund their share. The Congressional Budget Office estimated federal Medicaid spending would fall by about 900 billion dollars over 10 years. Supporters say the changes encourage work and curb waste, while opponents say millions of eligible people will lose coverage over paperwork.