Fact check: What are the Medicaid eligibility requirements under the big beautiful bill?

1. Why the Eligibility Rules Matter — A Snapshot of Who Changed Coverage

Studies of the ACA expansion show Medicaid became available to millions of low-income adults, altering the demographic mix of enrollees: potential expansion-eligible adults skewed male and white compared with pre-expansion beneficiaries, and reported different health behaviors such as higher tobacco use and alcohol consumption but lower obesity and depression prevalence ^[1]. Research also flags that immigration status and state-level decisions meant a sizable low-income population remained ineligible even after expansion, leaving local safety nets to absorb care needs ^[4]. These eligibility contours are as consequential for provider planning as they are for individual health outcomes.

2. The Key Eligibility Mechanism — Income Thresholds and the 138% Federal Poverty Line

A central, concrete eligibility rule from the ACA expansion tied Medicaid eligibility for nonelderly adults to incomes at or below 138% of the federal poverty line in expansion states; that threshold is the baseline used in comparative studies and state analysis ^[2]. This income cutoff interacts with family size, household composition, and tax rules introduced by the ACA, meaning practical eligibility often depends on how income is counted and verified, which advocates say requires extensive outreach and education for low-income and limited-English-proficiency communities ^[5].

3. Who Remains Excluded — Immigration and State Non-Expansion Effects

Multiple analyses emphasize that legal immigration status and whether a state chose to expand Medicaid are the dominant drivers of exclusion. The ACA left some nonelderly low-income adults uninsured because of immigration-related restrictions; states with large immigrant populations therefore saw larger coverage gaps and greater reliance on local safety-net care ^[4]. Non-expansion states also preserve the pre-ACA categorical eligibility model, which often restricts adults without dependent children, so state policy choices create stark geographic disparities in who qualifies.

4. Behavioral and Economic Responses — Income Changes and Labor Market Effects

Empirical work through mid-2025 documents behavioral responses to Medicaid cutoffs: one June 2025 study found childless adults in expansion states adjusted earnings downward to qualify for Medicaid, with stronger responses when the individual mandate penalty remained active, signaling labor supply adjustments tied to eligibility cliffs ^[6]. These findings imply that eligibility design — specifically sharp income notches — creates incentives that affect work and income reporting, complicating assumptions that coverage changes purely reflect unmet health needs rather than economic optimization.

5. Recent Policy Shocks — 2025 Proposals and Projected Coverage Losses

A July 2025 projection examined the 2025 Budget Reconciliation Bill and estimated that proposed Medicaid changes could render 7.6 million people uninsured, with downstream increases in deaths, preventable hospitalizations, and economic losses concentrated in rural and underserved areas ^[3]. This modeling highlights how federal legislative revisions can rapidly alter eligibility and coverage at scale, and underscores that eligibility is a moving policy target influenced by Congress and administrative rules as much as by baseline law.

6. Access and Provider Payment — Eligibility Is Only One Piece of the Puzzle

Even with expanded eligibility, access to care depends on provider participation and payment levels; recent fee index research shows Medicaid physician fees remain substantially below Medicare levels, around 71–75% of Medicare depending on the index and year, which constrains provider capacity and appointment availability for newly eligible enrollees ^[7]. This payment gap means eligibility expansions do not automatically translate into care access, especially in specialties or geographic areas with workforce shortages.

7. What Is Missing from the Public Narrative — Administrative and Outreach Challenges

Analyses emphasize important but often omitted considerations: tax provisions and outreach obligations under the ACA require education of low-income taxpayers and limited English speakers, and administrative verification processes can produce delays or churn in enrollment ^[5]. Research also documents information gaps about who exactly benefits from expansion; while headline income thresholds are clear, state implementation choices, immigration rules, and administrative complexity shape daily eligibility, making accurate public claims about “who is eligible” incomplete without state-by-state context ^{[1] [4]}.

8. Bottom Line for Policymakers and the Public — Eligibility Is Conditional and Contested

The evidence shows Medicaid eligibility under the ACA-era expansion is defined by a clear federal income threshold in expansion states but is conditioned by state uptake, immigration status, administrative rules, and federal legislative changes, any of which can expand or contract coverage. Empirical studies through July 2025 document demographic shifts among eligibles, labor-market responses to eligibility thresholds, and modelled large-scale losses tied to 2025 policy proposals, illustrating that eligibility is not just a technical rule but a policy lever with wide social and economic consequences ^{[1] [6] [3]}.