Medicaid Income Eligibility Transitions Among Rural Adults

The Affordable Care Act (ACA) Medicaid Expansion allows coverage for all adults aged 18 to 64 with income below 138 percent of the federal poverty level (FPL), and as of 2018, 32 states had implemented expansion. Research prior to the ACA suggests people may transition in and out of Medicaid income eligibility, but little is known about how this may affect rural adults. Movement in and out of Medicaid may increase administrative costs, create benefit and provider discontinuity, or lead to patient difficulties in paying medical bills and accessing care. This brief uses data from the national Survey of Income and Program Participation to examine the extent to which rural and urban residents’ incomes shift above or below the Medicaid expansion eligibility threshold of 138 percent of FPL during a calendar year (2010). We find that in 2010, rural adults were more likely than those in urban areas to begin the year with incomes below 138 percent of the federal poverty level, particularly in states that did not expand Medicaid. Compared with their urban counterparts, rural adults were also more likely to experience an income shift during the year that would have changed their eligibility for expanded Medicaid. This somewhat higher rate of income eligibility transition among rural versus urban adults appears to be driven by the generally lower incomes of those in rural areas and could have implications for rural individuals, communities and states