Navigating Medicaid: An Exhaustive Eligibility Guide for Unmarried Parents

Introduction to Medicaid for the Modern Family Structure

Purpose and Scope

This report provides an exhaustive analysis of the eligibility rules for Medicaid and the Children’s Health Insurance Program (CHIP) for a family unit composed of an unmarried couple living together with their mutual child. Navigating the landscape of public health coverage can be a formidable task, with rules that are often complex, counterintuitive, and highly dependent on both federal law and state-specific implementation. The objective of this analysis is to demystify this intricate system, offering a clear and authoritative guide for families seeking to understand their options. The report will dissect the financial and non-financial requirements, with a particular focus on the nuanced and often misunderstood methods for determining household composition and countable income for each member of an unmarried family. By breaking down these complex regulations into understandable components, this report aims to empower families with the knowledge needed to successfully secure health coverage.

The Evolving Landscape of Public Health Coverage

Medicaid is a cornerstone of the American healthcare system, operating as a joint partnership between the federal government and individual states to provide free or low-cost health coverage to millions of Americans.¹ Its beneficiaries include a diverse range of populations, from low-income families and their children to pregnant individuals, adults with disabilities, and the elderly.² Historically, eligibility for these programs was tied to a patchwork of rules often linked to cash assistance programs like the former Aid to Families with Dependent Children (AFDC), resulting in a system that varied dramatically from state to state and was notoriously difficult to navigate.¹

The passage of the Affordable Care Act (ACA) in 2010 marked a fundamental transformation in how eligibility is determined for the majority of applicants. The ACA sought to standardize and simplify the process by establishing a new methodology based on Modified Adjusted Gross Income (MAGI), aligning the definition of income more closely with federal tax rules.¹ This shift created a more streamlined application process and a “no wrong door” approach, where a single application can be used to determine eligibility for Medicaid, CHIP, or subsidized private insurance through the Health Insurance Marketplace.³ Despite this move toward standardization, the system remains deeply complex, as states retain significant control over income thresholds and the specific populations they choose to cover.

The Central Challenge for Unmarried Couples

For unmarried couples, the modern Medicaid rules present a unique and often perplexing challenge. The system’s reliance on tax-filing relationships means that marital status has profound implications for eligibility determination. Unlike a married couple, who are generally assessed as a single financial unit for the purposes of Medicaid, an unmarried couple with a child will discover that the state agency evaluates eligibility for each parent and the child separately. This leads to a counterintuitive reality where different household sizes and income calculations are applied to individuals living under the same roof.⁵ The child’s eligibility may be determined based on the combined income of both parents, while each parent’s eligibility is assessed based on their individual income alone. This report will meticulously dissect these rules, providing the clarity necessary for unmarried partners to understand their distinct pathways to coverage and make informed decisions for their family’s health and financial well-being.

The Foundational Eligibility Framework: MAGI and Non-Financial Rules

Before delving into the complexities of household income, it is essential to understand the two pillars of Medicaid eligibility: universal non-financial prerequisites and the financial standard of Modified Adjusted Gross Income (MAGI). These foundational elements serve as the initial gateways through which every application must pass.

Non-Financial Prerequisites: The Universal Gates to Eligibility

Regardless of income, every individual applying for Medicaid must first satisfy a set of basic, non-financial criteria. These requirements are generally consistent across all states and form the initial screening layer for the program.

• State Residency: An applicant must be a resident of the state in which they are applying for Medicaid benefits.¹ This is a primary and non-negotiable condition. An individual is typically considered a resident if they live in the state and intend to remain there, even if they lack a permanent address.⁸
• Citizenship and Immigration Status: Medicaid beneficiaries must generally be citizens of the United States or certain “qualified non-citizens,” a category that includes lawful permanent residents (often called “green card holders”), refugees, and asylees, among others.¹ States must verify this status as part of the application process.⁹
  
  A point of critical importance for many families is that a child’s eligibility is determined based on their own citizenship or immigration status, not that of their parents.10 This means a child who is a U.S. citizen can qualify for Medicaid or CHIP even if their parents are undocumented or do not meet the non-citizen requirements. This policy design deliberately decouples a child’s access to healthcare from their parents’ immigration status, creating a vital safety net for children in mixed-status families.
• Social Security Number (SSN): Applicants are typically required to provide a valid Social Security Number or proof that they have applied for one.²

The MAGI Revolution: A Paradigm Shift in Financial Eligibility

The Affordable Care Act introduced a revolutionary change to Medicaid by establishing Modified Adjusted Gross Income (MAGI) as the primary financial eligibility methodology for most children, pregnant individuals, parents, and adults under 65 in states that expanded their programs.¹ This shift was designed to create a more logical and uniform system aligned with federal income tax rules, replacing the complex and often archaic income-counting methods of the past.⁴

• Defining and Calculating MAGI: MAGI is not a line item on a tax return but rather a calculation. It begins with the applicant’s Adjusted Gross Income (AGI)—the figure found on line 11 of IRS Form 1040—and then adds back certain non-taxable income sources. Specifically, the formula is: AGI+Untaxed Foreign Income+Non-taxable Social Security Benefits+Tax-exempt Interest=MAGI.¹¹ For the vast majority of low-income families who do not have these specific additional income sources, their MAGI will be identical to their AGI.¹¹ The household’s total MAGI is then compared to the Federal Poverty Level (FPL) for their household size to determine eligibility.
• The End of Asset Tests (for Most Applicants): One of the most significant consequences of the transition to MAGI is the elimination of asset or resource tests for MAGI-based eligibility groups.¹ Under the old system, applicants could be denied coverage for having even modest savings, a reliable second car, or other assets deemed to be in excess of very low limits. The MAGI framework focuses exclusively on income flow, not accumulated wealth. This policy change allows low-income working families to build emergency savings, plan for the future, or own necessary property without the fear of jeopardizing their health coverage. This stands in stark contrast to the rules for “non-MAGI” Medicaid categories, which cover individuals who are aged (65+), blind, or disabled. These programs continue to enforce strict asset limits, often around $2,000 for an individual, and scrutinize resources like bank accounts, stocks, and real property other than a primary residence.⁷ The distinction between MAGI (no asset test) and non-MAGI (strict asset test) represents a fundamental divergence in how Medicaid treats different populations.

To provide practical clarity for families assessing their financial standing, the following table outlines common income sources and specifies whether they are counted or disregarded under the MAGI methodology. Understanding these distinctions is crucial, as certain income streams that might seem significant, such as child support payments, are explicitly excluded from the eligibility calculation.

Table 1: MAGI Countable vs. Non-Countable Income Sources
Countable MAGI Income	NOT Countable MAGI Income
Wages, salaries, tips, bonuses 6	Supplemental Security Income (SSI) 4
Net income from self-employment 6	Temporary Assistance for Needy Families (TANF) 4
Unemployment compensation 6	Child support payments received 4
Social Security benefits (both taxable and non-taxable portions) 11	Workers’ compensation benefits 4
Pensions and annuity payments 7	Veterans’ benefits 6
Distributions from retirement accounts (e.g., 401(k), IRA) 13	Supplemental Nutrition Assistance Program (SNAP) 7
Interest (including tax-exempt interest) and dividends 7	Federal housing assistance / subsidies 7
Alimony received (for divorce/separation agreements executed before 2019) 13	Gifts and inheritances 6
Rental income (net) 13	Foster care payments 14

Deconstructing the Medicaid Household: A Deep Dive into MAGI Rules

The concept of a “household” is the absolute linchpin of a MAGI Medicaid determination. It is also the source of the greatest confusion for applicants. Under MAGI rules, a household is not simply defined by who lives under one roof. Instead, it is a technical construct based on anticipated federal income tax filing relationships.¹ The most critical principle to grasp is that Medicaid determines household size and composition

separately for each individual applicant.⁵ This means a mother, father, and child living together can each have a different Medicaid household size, which in turn means their eligibility is measured against different income limits.

The Three Foundational Household Categories

To determine an individual’s unique Medicaid household, the system first places them into one of three categories based on their expected tax filing status for the coverage year.⁵

1. The Tax Filer: This category includes any individual who expects to file a federal income tax return and who will not be claimed as a tax dependent by another person. This includes individuals filing as single, head of household, or married filing separately, as well as both spouses in a married filing jointly return.¹⁶

• Household Construction Rule: For a tax filer, the Medicaid household consists of the filer, their spouse (if filing a joint return), and every person they expect to claim as a tax dependent on their return.¹¹

2. The Tax Dependent: This category includes any individual who expects to be claimed as a tax dependent on someone else’s federal tax return. Even if a person earns enough to be required to file their own taxes, if they can also be properly claimed as a dependent by another taxpayer (such as a college student being claimed by a parent), they are treated as a tax dependent for Medicaid purposes.¹⁶

• Household Construction Rule (Default): The default rule is straightforward: a tax dependent’s Medicaid household is identical to the household of the tax filer who is claiming them.¹⁶

3. The Non-Filer: This category is for individuals who do not expect to file a tax return and do not expect to be claimed as a tax dependent by anyone.¹⁵

• Household Construction Rule: For an adult non-filer, the household includes the individual plus, if living with them, their spouse and their own children under age 19. For a child non-filer (e.g., an orphan living with a non-relative who is not claiming them as a tax dependent), the household includes the child plus, if living with them, their parents and any siblings under age 19.⁶

The Three Critical Exceptions to the Tax Dependent Rule

The complexity of the system arises from three crucial exceptions where a tax dependent does not use the default tax dependent rule. In these specific cases, the dependent’s household is instead constructed using the more expansive Non-Filer rules. These exceptions are not arbitrary; they are designed to more accurately reflect the financial resources available to certain dependents. Understanding these exceptions is essential, as the second one directly governs the situation of an unmarried couple’s child.¹⁶

• Exception 1: The Non-Parent/Non-Spouse Dependent. This exception applies to an individual who is claimed as a tax dependent by someone other than their parent (biological, adoptive, or step) or their spouse. A common example is a child being claimed as a dependent by a grandparent, aunt, or uncle they live with.¹² In this case, the child’s household is built using the Non-Filer rules, not the grandparent’s tax household.
• Exception 2: The Child of Unmarried Parents. This is the most relevant exception for this report. It applies to a child under age 19 who lives with both of their parents, but whose parents are not married and therefore cannot file a joint tax return. If the child is claimed as a tax dependent by one of the parents, this exception is triggered.¹² The child’s household is then constructed using the Non-Filer rules.
• Exception 3: The Child Claimed by a Non-Custodial Parent. This exception applies to a child under age 19 who is claimed as a tax dependent by their non-custodial parent. A non-custodial parent is defined by a court order or, in the absence of one, as the parent with whom the child spends fewer nights.¹⁸ Even though the child lives with the custodial parent, if they are claimed on the non-custodial parent’s taxes, their household is determined by the Non-Filer rules, which centers on their living situation with the custodial parent.

The Unmarried Couple with a Child: A Multi-Household Analysis

With the foundational MAGI rules established, it is now possible to apply them directly to the specific circumstances of an unmarried couple and their child. This analysis reveals how the system assesses each family member’s eligibility through a distinct lens, leading to different potential outcomes for each person.

Case Study: A Practical Application of the Rules

To illustrate these principles in action, we can use a common scenario, similar to the “Dan and Jen” example found in federal guidance and analysis documents.⁶

• The Family Setup: Consider a family consisting of Sarah, Mark, and their 5-year-old child, Emily. Sarah and Mark are unmarried but live together and share household expenses. They must file separate federal income tax returns. On her tax return, Sarah files as “Head of Household” and claims Emily as her tax dependent. Mark files his tax return as “Single” and does not claim any dependents.
• Analysis of Each Person’s Medicaid Household:
• Sarah’s Household (The Parent Claiming the Child): Sarah is a Tax Filer. Therefore, her Medicaid household is determined using the Tax Filer rule. Her household includes herself and any individuals she claims as tax dependents. In this case, that is Emily.

• Sarah’s Household Size = 2 (Sarah + Emily).
• Sarah’s Household Income: The income counted for Sarah’s eligibility is the combined MAGI of herself and Emily (if Emily had any income, which is unlikely for a 5-year-old). In practice, this is just Sarah’s income.
• Mark’s Household (The Parent Not Claiming the Child): Mark is also a Tax Filer. His Medicaid household is also determined by the Tax Filer rule. Since he does not claim any dependents on his tax return, his household consists only of himself.

• Mark’s Household Size = 1 (Mark).
• Mark’s Household Income: The income counted for Mark’s eligibility is his MAGI alone.
• Emily’s Household (The Child): Emily is a Tax Dependent of Sarah. At first glance, it would seem her household should be the same as Sarah’s (a household of 2). However, Emily’s situation triggers Exception #2 to the Tax Dependent rule. She is a child under 19, she lives with both of her parents (Sarah and Mark), and her parents are not filing a joint tax return.¹⁸ Because this exception applies, Emily’s household is constructed using the
  Non-Filer rules. The Non-Filer rule for a child states that the household includes the child plus any parents and siblings living with them.

• Emily’s Household Size = 3 (Emily + Sarah + Mark).
• Emily’s Household Income: The income counted for Emily’s eligibility is the combined MAGI of everyone in her Medicaid household—that is, the sum of both Sarah’s income and Mark’s income.

The Core Finding: The “Child’s Household” Anomaly

The application of Exception #2 creates a striking and seemingly paradoxical outcome: the child’s pathway to coverage is evaluated against the combined financial resources of both parents, while each parent’s individual pathway to coverage is evaluated against a smaller, separate income pool. This is the single most critical, non-intuitive rule for an unmarried couple to understand when applying for Medicaid.

This rule is a deliberate policy design. Its purpose is to align with the real-world financial situation of a child living with both of their biological parents. The logic is that the child benefits from the economic support of both adults in the home, regardless of their marital status or how they choose to file their taxes. This mechanism prevents a scenario where a high-income couple could gain Medicaid for their child simply by remaining unmarried and arranging for only the lower-income partner to claim the child on their tax return. The system effectively “sees through” this tax arrangement to count the income of both parents when assessing the child’s need, ensuring that public benefits are directed to children in households with genuinely low combined income.

To crystallize the profound difference that marital status makes, the following table contrasts the household and income determinations for our unmarried couple, Sarah and Mark, with what they would be if they were married and filing a joint tax return.

Table 2: Household Composition & Income Pool: Unmarried vs. Married Couples
Family Member	Scenario A: Unmarried Couple (Living Together)	Scenario B: Married Couple (Filing Jointly)
Sarah (Parent 1)	Household Size: 2 (Sarah + Emily) Income Pool: Sarah’s Income	Household Size: 3 (Sarah + Mark + Emily) Income Pool: Sarah’s Income + Mark’s Income
Mark (Parent 2)	Household Size: 1 (Mark) Income Pool: Mark’s Income	Household Size: 3 (Sarah + Mark + Emily) Income Pool: Sarah’s Income + Mark’s Income
Emily (Child)	Household Size: 3 (Emily + Sarah + Mark) Income Pool: Sarah’s Income + Mark’s Income	Household Size: 3 (Sarah + Mark + Emily) Income Pool: Sarah’s Income + Mark’s Income

As the table demonstrates, for a married couple, the household size and income pool are identical for all three family members. For the unmarried couple, however, three separate calculations with three different results must be performed.

Pathways to Coverage: Eligibility Categories for Your Family

Once the household size and income for each family member have been determined, the final step is to compare that income to the limits for the specific Medicaid eligibility categories available in their state. These categories often have vastly different income thresholds, creating distinct pathways to coverage for children and parents.

Coverage for the Child: Medicaid and CHIP

Children typically have the most robust and accessible pathways to public health coverage. Federal law mandates that states cover children in families with incomes up to at least 133% of the Federal Poverty Level (FPL) through Medicaid, but nearly every state has set its income limits well above this floor.¹

• Children’s Medicaid: This program provides comprehensive, free health coverage for children in families with lower incomes. The exact income limit varies by the child’s age and the state in which they live. For example, in Georgia, children ages 0-5 can qualify with household income up to 149% of the FPL, while children ages 6-18 are covered up to 133% FPL.¹⁰
• Children’s Health Insurance Program (CHIP): CHIP was created to cover children in working families who earn too much to qualify for Medicaid but cannot afford or access private health insurance.²² CHIP eligibility thresholds are significantly higher than for Medicaid, with many states covering children in families with incomes at or above 200% of the FPL.²² Some states, like New Jersey, extend eligibility to children in families with incomes as high as 355% FPL.²⁴ While Medicaid is typically free, some states may charge modest monthly premiums or copayments for services under their CHIP programs, though total out-of-pocket costs are capped at 5% of the family’s income.²⁵

The existence of these higher income limits for children means it is very common for a child in an unmarried couple’s family to qualify for Medicaid or CHIP, even if the parents’ combined income (which is used for the child’s determination) makes the parents themselves ineligible for any coverage.

Coverage for the Parents: The “Parent/Caretaker Relative” Category

The primary eligibility pathway for low-income parents is the “Parent/Caretaker Relative” category. To qualify, an adult must be a parent (natural, adoptive, or step) or a specified close relative who has primary caregiving responsibility for a dependent child under age 18 (or 19 if a full-time student) living in the home.²⁷

The critical factor for this category is that the income limits are often dramatically lower than those for children, particularly in states that have not expanded their Medicaid programs under the ACA. This disparity creates what is commonly known as the “coverage gap,” where parents earn too much to qualify for Medicaid but too little to receive subsidies to buy private insurance on the Marketplace. For example, in Texas, a non-expansion state, the monthly income limit for a two-parent family of three is a mere $251.³¹ In Mississippi, another non-expansion state, the limit for a family of three in the Parent/Caretaker category is $495 per month.³² In stark contrast, a state like New Jersey, which has expanded Medicaid, covers adults in this category with incomes up to 138% of the FPL, which translates to a monthly income of $3,065 for a family of three (as of 2025).²⁴ This illustrates that a parent’s ability to get coverage is often less about their income in absolute terms and more about the political and policy decisions made by their state legislature.

Coverage for a Pregnant Partner

Medicaid provides a distinct and more generous eligibility pathway for pregnant individuals. Recognizing the importance of prenatal and maternal health, federal law requires states to cover pregnant individuals at higher income levels than other adults. Most states set their income limits for this category at or above 200% of the FPL.²⁴ When determining eligibility for a pregnant applicant, her household size is counted as herself plus the number of children she is expected to deliver, which further increases the corresponding income limit.⁶ This coverage is comprehensive and typically continues for a full 12 months after the pregnancy ends to ensure postpartum health.²⁷

The State-Level Mosaic: How Where You Live Defines Your Options

While the MAGI rules for constructing a household and counting income are federally mandated, the ultimate determination of eligibility hinges on state-specific decisions. States have broad authority to set the income limits for each eligibility category, choose which optional groups to cover, and name their programs. This creates a complex mosaic of coverage across the country, where eligibility for an identical family can vary dramatically based simply on their state of residence.

Federal Rules, State Administration

The Medicaid program is a partnership, and this duality is key to understanding its application. The federal government sets the foundational rules—such as the MAGI methodology and mandatory coverage for certain groups like children—but states administer their own programs.¹ This leads to different program names, such as NJ FamilyCare in New Jersey ²⁴, MIChild in Michigan ³⁴, TennCare in Tennessee ³⁵, and SoonerCare in Oklahoma.³⁶ More importantly, it leads to vastly different income thresholds.

The Impact of Medicaid Expansion

The most significant factor driving state-level variation is the state’s decision on whether to expand its Medicaid program under the ACA. The law allowed states to expand coverage to nearly all non-elderly adults with household incomes up to 138% of the FPL.¹ In states that adopted expansion, low-income parents have a much clearer path to coverage. In states that have not expanded, adults who are not pregnant or disabled can only qualify through the very restrictive Parent/Caretaker Relative category, which often has income limits far below the poverty line, leaving many working parents in the coverage gap.³¹

The following table provides a sample of monthly income limits from various states to illustrate this divergence. It uses a household size of three to provide a consistent point of comparison, demonstrating how a family’s access to healthcare is fundamentally shaped by their zip code.

Table 3: Sample State Monthly Income Limits (Effective 2025) – Family of Three
State	Child (age 1-5)	Parent/Caretaker Relative	Pregnant Individual
Georgia	≤149% FPL	Very Low Fixed Limit	≤220% FPL
Mississippi	≤143% FPL	22% FPL ($495/mo) 32	≤194% FPL 32
New Jersey	≤355% FPL (CHIP) 24	≤138% FPL ($3,065/mo) 24	≤205% FPL 24
New Mexico	≤240% FPL 33	Fixed Limit ($765/mo) 33	≤250% FPL 33
Texas	≤133% FPL ($2,954/mo) 37	Very Low Fixed Limit ($230/mo) 31	≤200% FPL
Tennessee	≤142% FPL ($3,154/mo) 35	Very Low Fixed Limit	≤195% FPL ($4,331/mo) 35
Note: FPL percentages and dollar amounts are based on available 2024-2025 data from the research and are subject to annual changes. Some states use fixed dollar amounts for certain categories that do not directly correspond to an FPL percentage.

The Application Process: A Practical Guide to Securing Coverage

Armed with an understanding of the complex eligibility rules, the final step is the application itself. The process has been streamlined in recent years, but it still requires careful attention to detail and the submission of thorough documentation to verify the information provided.

Where and How to Apply

The ACA established a “no wrong door” policy for applications, meaning families can apply for health coverage through multiple channels and be directed to the appropriate program based on their eligibility.³

• Primary Application Methods:

1. Online via the Health Insurance Marketplace: The most common starting point is the federal website, HealthCare.gov, or a state-run marketplace website.³ The single application is designed to screen for eligibility for all programs: Medicaid, CHIP, and subsidized private health plans. If the information entered indicates a potential eligibility for Medicaid or CHIP, the Marketplace automatically and securely forwards the application to the appropriate state agency for a final determination.³
2. Directly with the State Medicaid Agency: Applicants can also apply directly with their state’s agency, which may be called the Department of Social Services (DSS), Department of Human Services (DHS), or a similar name.³⁸

• Alternative Application Methods: Most states also offer the ability to apply by phone, by mail, or in person at a local county office.³⁸ Free assistance from trained enrollers or navigators is often available to help families complete the application.

Comprehensive Documentation Checklist

To process an application, the state agency must verify the applicant’s identity, residency, income, and other relevant factors. While some information can be verified electronically through data-matching with other government agencies, applicants should be prepared to provide paper documentation. Gathering these documents in advance can significantly speed up the eligibility determination process. The following is a comprehensive checklist synthesized from various state requirements.

• Proof of Identity (for all applicants) ⁴¹:

• Valid Driver’s License or State-Issued Photo ID Card
• U.S. Passport or Passport Card
• U.S. Military ID Card
• Proof of U.S. Citizenship or Lawful Immigration Status ⁴¹:

• U.S. Birth Certificate
• U.S. Passport
• Certificate of Naturalization or Citizenship
• Permanent Resident Card (Form I-551 or “Green Card”)
• Other immigration documents (e.g., I-94 Arrival/Departure Record)
• Proof of State Residency ⁴¹:

• Current utility bill (gas, electric, water)
• Lease agreement or mortgage statement
• Driver’s license or state ID with current address
• Official mail from a government agency
• Proof of Social Security Number (for all applicants) ⁴¹:

• Social Security card
• Official correspondence from the Social Security Administration (SSA) showing the number
• Proof of Income (for all household members with income) ⁴³:

• Recent paycheck stubs (typically for the last 30 days or four consecutive weeks)
• W-2 forms or most recent federal tax return
• A letter from an employer stating gross wages and pay frequency
• Award letters for other benefits (e.g., Social Security, Veterans Affairs, unemployment)
• For self-employment: tax returns with all schedules or detailed business records of income and expenses.
• Proof of Household Composition and Relationships ⁸:

• The child’s birth certificate listing the parents is the primary document for establishing the parent-child relationship.
• The application form itself serves as the declaration of who lives in the home and their relationships. States generally accept this declaration unless there is conflicting information.
• Information on Other Health Coverage ²:
• If any household member has access to or is enrolled in other health insurance (such as through an employer), they will need to provide the policy information, including the insurance company name and policy number.

After an application is submitted, it can take up to 45 days for the state to make a determination (or longer if a disability determination is needed).³⁸ The state agency will notify the applicant by mail of the decision.

Strategic Considerations and Final Recommendations

Navigating the Medicaid eligibility process as an unmarried couple with a child requires a strategic understanding of its unique and often non-intuitive rules. The structure of the MAGI system creates specific challenges and opportunities that differ significantly from those faced by married couples. A clear grasp of these differences is essential for maximizing the chances of securing coverage for every eligible family member.

Key Takeaways for the Unmarried Couple

The entire analysis of MAGI rules distills down to several critical points that should guide an unmarried couple’s approach to the application process.

• Think Per-Person, Not as a Single Family Unit: The most important strategic shift is to abandon the idea of applying as a single “family.” Eligibility is not determined for the family as a whole. It is a separate, individual determination for the child, for Parent 1, and for Parent 2. The most common and likely outcome of an application is that the child will be found eligible for Medicaid or CHIP, while one or both parents will not be. This is not a system failure; it is the intended result of a design that provides more generous coverage pathways for children.
• The Child’s Income Test is Stricter: Families must be prepared for the fact that their child’s eligibility will be evaluated against the combined income of both parents living in the home. This is a direct consequence of the “Exception #2” rule for children of unmarried parents. It ensures that the child’s need is assessed based on the total household resources available to them.
• The Parents’ Eligibility is Highly State-Dependent: In contrast, each parent’s eligibility is assessed against their individual income and a smaller household size. Their success in obtaining coverage hinges almost entirely on whether their state has expanded Medicaid to cover adults up to 138% of the FPL. In non-expansion states, the income limits for the Parent/Caretaker category are so low that even parents with incomes below the federal poverty line are often ineligible.

The Tax Dependent Question

A common point of confusion is whether the choice of which parent claims the child as a tax dependent has a significant impact on Medicaid eligibility. Based on the MAGI rules, the impact is minimal and primarily affects the parents, not the child. As established in the case study, the child’s household size (and thus the income counted against them) will include both parents regardless of which one claims them as a dependent. The parent who does claim the child will have a slightly larger household size (e.g., 2 instead of 1). This increases the income limit they are measured against, potentially making it slightly easier for them to qualify. However, this is a minor tactical consideration compared to the much larger structural factors, such as the state’s expansion status and the vast difference between income limits for children and parents.

Final Recommendation: Apply Regardless of Uncertainty

The single most important piece of advice for any family in this situation is to complete and submit an application. The Medicaid and Marketplace systems are complex by nature, but they are designed to be a “no wrong door” service. Families should not attempt to be their own eligibility workers or decide in advance that they will not qualify. The application process is free, and there is no penalty for being denied.

By submitting a single application through the Health Insurance Marketplace or a state agency, a family triggers a comprehensive review. The system will automatically determine if the child is eligible for Medicaid or CHIP, if the parents are eligible for Medicaid, or if the family qualifies for tax credits and cost-sharing reductions to make private insurance affordable.³ An application is the only way to access these potential benefits. Failing to apply guarantees no assistance, whereas applying opens the door to a range of possibilities that can secure a family’s health and financial stability.

Works cited

1. Eligibility Policy | Medicaid, accessed August 13, 2025, https://www.medicaid.gov/medicaid/eligibility-policy
2. How to apply for Medicaid and CHIP | USAGov, accessed August 13, 2025, https://www.usa.gov/medicaid-chip-insurance
3. Who’s eligible for Medicaid? – HHS.gov, accessed August 13, 2025, https://www.hhs.gov/answers/medicare-and-medicaid/who-is-eligible-for-medicaid/index.html
4. How does MAGI affect eligibility for the Medicaid program? – DC Health Link, accessed August 13, 2025, https://www.dchealthlink.com/faqs/how-does-magi-affect-eligibility-medicaid-program
5. Medicaid Household Rules – Beyond the Basics, accessed August 13, 2025, https://www.healthreformbeyondthebasics.org/reference-guide-medicaid-household-rules/
6. Determining Household Size for Medicaid and the Children’s Health Insurance Program, accessed August 13, 2025, https://www.healthreformbeyondthebasics.org/key-facts-determining-household-size-for-medicaid-and-chip/
7. Medicaid Eligibility | ACL Administration for Community Living, accessed August 13, 2025, https://acl.gov/ltc/medicare-medicaid-and-more/medicaid/medicaid-eligibility
8. CHAPTER 102 – Non-Financial Requirements – Mississippi Division of Medicaid, accessed August 13, 2025, https://medicaid.ms.gov/wp-content/uploads/2014/03/Chapter102.pdf
9. Basic Eligibility | Georgia Medicaid, accessed August 13, 2025, https://medicaid.georgia.gov/how-apply/basic-eligibility
10. Eligibility FAQs – Georgia Medicaid, accessed August 13, 2025, https://medicaid.georgia.gov/eligibility-faqs
11. Job Aid: Income Eligibility Using MAGI Rules – CMS, accessed August 13, 2025, https://www.cms.gov/marketplace/eligibility-enrollment-resources/MAGI-rules.pdf
12. MAGI Household Composition – DHCS, accessed August 13, 2025, https://www.dhcs.ca.gov/services/medi-cal/Documents/EE_Wrkgrp/MAGI%20HH%20Composition%20SOTA.pdf
13. How Medicaid Counts Income for Single Applicants & Married Couples, accessed August 13, 2025, https://www.medicaidplanningassistance.org/how-medicaid-counts-income/
14. Medicaid / ​Medical Assistance General Eligibility Requirements – Commonwealth of Pennsylvania, accessed August 13, 2025, https://www.pa.gov/agencies/dhs/resources/medicaid/medicaid-general-eligibility
15. www.healthreformbeyondthebasics.org, accessed August 13, 2025, https://www.healthreformbeyondthebasics.org/reference-guide-medicaid-household-rules/#:~:text=Updated%20August%202023,claimed%20as%20a%20tax%20dependent
16. Tip Sheet: Household Determination for MAGI Medicaid – KHBE, accessed August 13, 2025, https://khbe.ky.gov/Agents-kynectors/Documents/HouseholdDeterminationMAGIMedicaid.pdf
17. A-240, Medical Programs | Texas Health and Human Services, accessed August 13, 2025, https://www.hhs.texas.gov/handbooks/texas-works-handbook/a-240-medical-programs
18. Part 1: Household Composition – Medicaid, accessed August 13, 2025, https://www.medicaid.gov/state-resource-center/mac-learning-collaboratives/downloads/part-1-household.pdf
19. Understanding Household Composition Under MAGI – NY State of Health, accessed August 13, 2025, https://info.nystateofhealth.ny.gov/sites/default/files/Household%20Composition%20Under%20MAGI%2C%208-12-15.pdf
20. Chapter_202.docx – SCDHHS.gov, accessed August 13, 2025, https://img1.scdhhs.gov/mppm/SCMPPM/Chapter_202.docx
21. Determining Household Size for Medicaid and the Children’s Health Insurance Program – Beyond the Basics, accessed August 13, 2025, https://www.healthreformbeyondthebasics.org/wp-content/uploads/2022/12/FAQ-Determining-HH-Size-Medicaid.pdf
22. CHIP Eligibility & Enrollment – Medicaid, accessed August 13, 2025, https://www.medicaid.gov/chip/chip-eligibility-enrollment
23. Medicaid & CHIP coverage | HealthCare.gov, accessed August 13, 2025, https://www.healthcare.gov/medicaid-chip/
24. Who Is Eligible? – NJ FamilyCare, accessed August 13, 2025, https://njfamilycare.dhs.state.nj.us/who_eligbl.aspx
25. CHIP Cost Sharing | Medicaid, accessed August 13, 2025, https://www.medicaid.gov/chip/chip-cost-sharing
26. Key CHIP design features – MACPAC, accessed August 13, 2025, https://www.macpac.gov/subtopic/key-design-features/
27. Who Qualifies for Coverage? – Mississippi Division of Medicaid, accessed August 13, 2025, https://medicaid.ms.gov/medicaid-coverage/who-qualifies-for-coverage/
28. family-related medicaid program fact sheet – Florida Department of Children and Families, accessed August 13, 2025, https://www.myflfamilies.com/sites/default/files/2024-05/FINAL%20April%202024%20MFAM%20Fact%20Sheet.pdf
29. H-2800 PARENTS AND CARETAKER RELATIVES GROUP, accessed August 13, 2025, https://ldh.la.gov/assets/medicaid/MedicaidEligibilityPolicy/H-2800m.pdf
30. Mississippi Medicaid Health Benefits, accessed August 13, 2025, https://medicaid.ms.gov/medicaid-coverage/who-qualifies-for-coverage/mississippi-medicaid-health-benefits/
31. Medicaid for Parents and Caretakers – Texas Health and Human Services, accessed August 13, 2025, https://www.hhs.texas.gov/services/health/medicaid-chip/medicaid-chip-programs-services/programs-children-families/medicaid-parents-caretakers
32. Income Limits for Medicaid and CHIP Programs – Mississippi Division of Medicaid, accessed August 13, 2025, https://medicaid.ms.gov/medicaid-coverage/who-qualifies-for-coverage/income-limits-for-medicaid-and-chip-programs/
33. Eligibility Categories – New Mexico Health Care Authority, accessed August 13, 2025, https://www.hca.nm.gov/wp-content/uploads/Eligibility-Pamphlet-7.1.2024.pdf
34. Medicaid – Health Care Programs Eligibility – State of Michigan, accessed August 13, 2025, https://www.michigan.gov/mdhhs/assistance-programs/medicaid/health-care-programs-eligibility
35. Eligibility Reference Guide | TN.gov, accessed August 13, 2025, https://www.tn.gov/content/dam/tn/tenncare/documents/eligibilityrefguide.pdf
36. Where to Apply – Oklahoma.gov, accessed August 13, 2025, https://oklahoma.gov/ohca/individuals/mysoonercare/apply-for-soonercare-online/where-to-apply.html
37. Children’s Medicaid and CHIP | Texas Health and Human Services, accessed August 13, 2025, https://www.hhs.texas.gov/services/health/medicaid-chip/medicaid-chip-programs-services/programs-children-adults-disabilities/programs-children-families/childrens-medicaid-chip
38. Apply for Healthcare – myDSS – MO.gov, accessed August 13, 2025, https://mydss.mo.gov/healthcare/apply
39. How To Apply for NC Medicaid, accessed August 13, 2025, https://medicaid.ncdhhs.gov/apply
40. Apply for Medicaid | Georgia.gov, accessed August 13, 2025, https://georgia.gov/apply-medicaid
41. Documents To Send With Your Application – Your Texas Benefits, accessed August 13, 2025, https://www.yourtexasbenefits.com/GeneratePDF/StaticPdfs/en_US/M5017_March2021.pdf
42. Documents that you will need to bring when making a Medicaid application – NJ.gov, accessed August 13, 2025, https://nj.gov/humanservices/ddd/documents/medicaid_document_verification_checklist.pdf
43. Form – DOCUMENTATION CHECKLIST For Health Insurance, accessed August 13, 2025, https://www.health.ny.gov/health_care/medicaid/publications/docs/adm/6att1checklis.pdf
44. DOCUMENTS NEEDED WHEN YOU APPLY FOR HEALTH INSURANCE – New York State Department of Health, accessed August 13, 2025, https://www.health.ny.gov/health_care/medicaid/publications/docs/adm/10adm-5att1doccheck.pdf
45. MEDICAID DOCUMENTS CHECKLIST – Burke & Casserly, P.C., accessed August 13, 2025, https://www.burkecasserly.com/static/2024/08/medicaid_doc_chcklst-website.pdf
46. How to Apply for Medicaid: A Step-by-Step Guide – Nest Health, accessed August 13, 2025, https://www.nesthealth.com/blog/how-to-apply-for-medicaid