Cost sharing and premiums

Benefits

States can require that certain groups of Medicaid beneficiaries pay enrollment fees, premiums, deductibles, coinsurance, copayments or similar cost-sharing amounts. There are, however, specific guidelines regarding who may be charged these fees, the services for which they may be charged, and the amount allowed. Cost sharing and premium rules differ under the State Children’s Health Insurance Program (CHIP). States are also experimenting with different approaches to the use of premiums and cost sharing for Medicaid beneficiaries under Section 1115 waivers.

Beginning October 1, 2015, the maximum allowable cost-sharing amounts shown are increased annually by the percentage increase in the medical care component of the Consumer Price Index for All Urban Consumers (CPI-U).

Maximum Allowable Medicaid Premiums and Cost Sharing, FY 2014

At or below 100 % FPL 100%–150% FPL Above 150% FPL
Exemptions from premiums and cost sharing
Exempt populations Those exempt from most types of cost sharing include most children under age 18, pregnant women, beneficiaries receiving hospice care, certain beneficiaries in institutions such as nursing facilities and intermediate care facilities, American Indians who are furnished a Medicaid item or service through an Indian Health Service provider or through a contract health service referral, and individuals eligible for Medicaid under the Breast and Cervical Cancer Act pathway. Except for certain pregnant women above 150% FPL, these populations are also exempt from premiums.
Exempt services Emergency services, family planning services and supplies, preventive services for children regardless of family income, pregnancy-related services, and services related to provider-preventable conditions are excluded from cost sharing.
Aggregate limit on allowable premiums and cost sharing
Aggregate limit for all populations The total amount of premiums and cost sharing incurred by all individuals in a Medicaid household may not exceed 5% of the family’s monthly or quarterly income.
Allowable premiums
Specified populations Up to $20 per month for individuals eligible under a medically needy pathway. Sliding scale based on income for individuals eligible under certain disability pathways for children and working adults. Same as rules at or below 150% FPL for medically needy and disability pathways. Up to 10% of amount by which income exceeds 150% FPL for certain pregnant women.
All other populations Not permitted No specific limit
Allowable cost sharing
Outpatient services Up to $4.00 Up to 10% of the amount the Medicaid agency pays Up to 20% of the amount the Medicaid agency pays
Inpatient stays Up to $75.00 Up to 10% of the amount the Medicaid agency pays Up to 20% of the amount the Medicaid agency pays
Non-emergency use of the emergency department Up to $8.00 No specific limit
Prescribed drugs Preferred drugs: Up to $4.00; Non-preferred: Up to $8.00 Preferred drugs: Up to $4.00; Non-preferrred: Up to 20% of the amount the Medicaid agency pays

Notes: FPL is federal poverty level. Definitions of FPL for different household sizes can be found here. Beginning October 1, 2015, the maximum allowable cost-sharing amounts shown are increased annually by the percentage increase in the medical care component of the Consumer Price Index for All Urban Consumers (CPI-U). This table does not reflect amounts that states may have implemented under a Section 1115 waiver. Source: CMS 2013.