Types of Insurance for Low Income People

Health insurance became a hot topic in 2009 and 2010 as U.S. government leaders debated the need for health care reform. According to the U.S. Census Bureau, more than 46 million Americans had no health insurance in 2008. For the poor, though, there are options. Several federal and state programs provide assistance with health care costs for the poorest Americans. This assistance comes through various programs, and most require formal application and approval.

Medicaid

• Medicaid is a federal program that covers the cost of most medical care for qualified low-income individuals and their families. Benefits vary by state. In California, Medicaid provides most services, including clinical care, surgical care and dental services, for $1 per visit. There are caps on some services. For example, the annual cap on dental services is $18,000 unless the patient is receiving emergency care or surgical care.The individual states administer the program. Eligibility is based on income and family size, and income guidelines vary by state. Thus, eligibility varies from one state to another. In New York, a family of four can earn up to $14,622 per year and still qualify for Medicaid. According to the U.S. Census Bureau, 14 percent of the U.S. population received Medicaid coverage in 2008. Of those 87.4 million Americans, 9.8 percent had no other health care coverage during the year. Medicaid coverage can be retroactive for three months prior to application provided that the individual would have qualified during that three-month period. If financial circumstances change, leading to ineligibility, coverage stops at the end of the month in which the change occurs.

Children's Health Insurance Program

• On February 4, 2009, the U.S. government passed the Children's Health Insurance Program Reauthorization Act. This law bolsters existing state-administered programs that provide health care coverage for low-income families. Among the changes is the addition of coverage for pregnant women and legal immigrants--children and pregnant women--to already existing coverage targeted to children. Families with infants and pregnant women can earn up 200 percent of the poverty level and still qualify. Children 1 to 5 years old can receive benefits if their families earn up to 133 percent of the federal poverty level.

State Plans

• While Medicaid covers the poorest Americans, it only provides medical coverage for those who meet eligibility requirements. Many states seek to expand the number of poor individuals and families covered by low-cost or free programs. Therefore, many states have created their own programs with different eligibility guidelines. Some programs are designed only to cover certain groups. For example, one Florida program, dubbed KidCare, only provides health care coverage for children whose families are poor. Another Florida plan, Cover Florida is designed to provide low-cost health insurance to individuals who have gone six months or more without insurance or who have recently lost employer-sponsored health insurance. The Cover Florida plan still requires individuals to pay premiums, but the premiums are considered lower than what would be required on the open market.