What Medicaid's income limits mean for people on disability

Medicaid has its own income limits that are separate from Social Security's rules. The limit depends on which Medicaid program you're in — and which state you live in, because states set their own thresholds. If you receive SSI (Supplemental Security Income), your Medicaid is usually automatic once you may have access to for SSI. If you receive SSDI (Social Security Disability Insurance), you may still may have access to for Medicaid even if your SSDI payment is above the SSI limit, because SSDI and Medicaid use different income calculations.

The key difference: Medicaid counts some income that Social Security ignores, and ignores some income that Social Security counts. This means you could be over the limit for one program but under the limit for another. Understanding which income counts toward Medicaid's limit — and which doesn't — determines whether you keep coverage when your earnings or benefits change.

Key Takeaways

  • SSI recipients usually get Medicaid automatically, but the income limit varies by state and is typically between $800 and $1,000 per month for an individual.
  • SSDI recipients may may have access to for Medicaid under "Medicaid Buy-In" programs even with higher income, depending on your state's rules.
  • Medicaid counts earned income (wages), unearned income (pensions, interest), and in-kind support (food or shelter someone gives you) differently than Social Security does.
  • Some income is excluded entirely from Medicaid's calculation, including the first $65 of monthly earnings plus half of anything above that, and certain types of support.
  • Your state Medicaid office can tell you the exact limit and which income counts in your situation — the rules differ significantly between states.

Income limits by program type and state

SSI recipients are categorically may be able to access for Medicaid in most states. This means if you may have access to for SSI, you usually get Medicaid without a separate income check. The SSI federal benefit rate for 2024 is $943 per month for an individual, but your state may add a supplement that raises the total. Your Medicaid stays active as long as your countable income stays below your state's SSI limit.

SSDI recipients face a different path. You do not automatically get Medicaid when you start SSDI, even if your payment is low. Instead, you must meet your state's Medicaid income limit for working-age adults with disabilities — typically between $1,000 and $2,000 per month, though this varies widely. Some states offer "Medicaid Buy-In" programs that let SSDI recipients keep Medicaid even with higher income, as long as they meet other rules like having limited resources. Contact your state Medicaid office to learn whether your state has a Buy-In program and what the income limit is.

A few states use the "1619(b) program," which lets SSI recipients keep Medicaid even when their earnings push them over the SSI payment limit. This is not automatic — you must request it, and your state must have chosen to offer it. If your state does offer 1619(b), you can work and earn more than the SSI limit while keeping Medicaid, as long as you stay under a higher earnings threshold (usually $2,000 to $3,000 per month).

Which income counts toward the Medicaid limit

Medicaid counts earned income (wages from work) and unearned income (Social Security payments, pensions, interest, rental income, unemployment benefits). It also counts in-kind support — food or shelter that someone gives you for free. If your parent pays your rent or a friend buys your groceries, Medicaid may count that as income, though the rules vary by state.

The federal Medicaid rules exclude the first $65 of your monthly earnings, then exclude half of anything you earn above that. So if you earn $500 per month, Medicaid counts $217.50 ($500 minus $65, then half of $435). This exclusion helps people who work keep their Medicaid while earning. However, your state may have different rules, and some states do not use this exclusion at all.

Medicaid does not count certain types of income: Supplemental Nutrition information Program (SNAP) benefits, housing vouchers, most tax refunds, gifts under certain conditions, and some types of support from nonprofits. If you receive food stamps or housing help, those do not reduce your Medicaid may be able to access. Your state Medicaid office can tell you which specific types of income your state excludes.

How to report income changes to Medicaid

You must report changes in income to your state Medicaid office, usually within 10 days. If you start working, get a raise, receive a new benefit, or lose income, contact Medicaid to update your case. Failing to report can result in overpayment — Medicaid may cover costs you were not actually may be able to access for, and you could be asked to repay the difference.

Most states let you report changes online through their Medicaid portal, by phone, by mail, or in person at a local office. You will need to provide proof of the income change: a pay stub, a letter from Social Security showing a new benefit amount, or a bank statement showing deposits. Keep copies of everything you send, and ask for a confirmation number or receipt.

If your income goes over the limit, your Medicaid will usually end at the end of the month in which you reported the change, or the month after, depending on your state's rules. Some states give you a grace period. Ask your caseworker what happens in your situation before you report, so you are not surprised by a coverage gap.

The difference between Medicaid and SSI income counting

Social Security and Medicaid use different rules for what counts as income, which is why you might lose SSI but keep Medicaid, or vice versa. SSI excludes the first $65 of monthly earnings plus half of the rest, just like Medicaid. But SSI also excludes certain types of support that Medicaid counts — for example, some gifts and some types of in-kind support.

The biggest difference is that SSI has a resource limit (you can own up to $2,000 in countable assets), while Medicaid's resource rules vary by state and program. You could have too many assets for SSI but still may have access to for Medicaid. Conversely, you could lose SSI because of income but keep Medicaid under a Buy-In program because the income limit is higher.

This is why it is important to check with both Social Security and Medicaid when your situation changes. A change that disqualifies you from one program might not affect the other. Your local Social Security office and your state Medicaid office can each explain how the change affects you.

What happens if your income exceeds the limit

If your income goes over your state's Medicaid limit, your coverage will end. The timing depends on your state — some end coverage the month you report the overage, others end it the following month. You will receive a notice explaining the reason and the date your coverage ends. This notice will also tell you whether you can appeal the decision.

Before your coverage ends, ask your Medicaid office whether you may have access to for any other programs. Some states offer limited Medicaid for people over the income limit who have high medical costs. Others may refer you to the Health Insurance Marketplace, where you might find a plan you can afford with a tax credit. If you are working, your employer may offer health insurance.

If you think the income calculation is wrong — for example, if Medicaid counted income it should have excluded — you can request an appeal. You usually have 30 days from the date on the notice to ask for a hearing. Bring documentation showing what income should and should not have been counted, and explain why you believe the decision was incorrect.

State-by-state variation in Medicaid rules

Medicaid income limits and counting rules differ significantly between states. Some states use the federal SSI limit ($943 per month for 2024), while others set their own higher or lower limits. Some states have Buy-In programs for SSDI recipients; others do not. Some states exclude certain types of income that other states count.

The only way to know your exact limit and which income counts in your state is to contact your state Medicaid office directly. You can find your state office through the Centers for Medicare & Medicaid Services (CMS) website, or call 211 to be connected to local Medicaid staff. Have your Social Security number and current income information ready when you call, so the caseworker can give you a specific answer for your situation.

If you are moving to a different state, your Medicaid coverage will not automatically transfer. You will need to explore in your new state, and your may be able to access may change because the income limits and rules are different. Contact the new state's Medicaid office as soon as you move to understand how the change affects you.

Frequently Asked Questions

Can I keep Medicaid if I earn more than the income limit?

It depends on your state and which program you are in. If you receive SSDI and your state has a Medicaid Buy-In program, you may keep Medicaid with higher income. If you receive SSI and your state offers the 1619(b) program, you can work and earn more while keeping Medicaid. Otherwise, income over the limit will end your coverage. Contact your state Medicaid office to learn what programs are available to you.

Does my spouse's income count toward my Medicaid limit?

For SSI, your spouse's income may be counted depending on your living situation and state rules. For SSDI and other Medicaid programs, your spouse's income usually does not count toward your limit. However, rules vary by state. Ask your Medicaid caseworker whether your spouse's income affects your case.

What if I receive both SSI and SSDI?

You cannot receive both SSI and SSDI at the same time — Social Security will pay you whichever benefit is higher. However, if you were receiving SSI and then become may be able to access for SSDI, you may be may be able to access for a small SSI payment called "deemed income" for a limited time. Your Medicaid may be able to access will be based on whichever benefit you are receiving. Contact Social Security to understand your specific situation.

Do I lose Medicaid when ready if my income goes over the limit?

No. Your coverage usually ends at the end of the month in which you reported the overage, or the following month, depending on your state. You will receive a notice with the exact end date. If you disagree with the decision, you can request an appeal before the coverage ends.

Can I appeal if Medicaid says my income is too high?

Yes. You have the right to request a fair hearing if you believe Medicaid made a mistake in calculating your income or explore the rules. You usually have 30 days from the date on the notice to request a hearing. Bring documentation of your actual income and any proof that certain income should have been excluded.