Modified Adjusted Gross Income: Implications for Medicaid Eligibility Systems under the ACA

This brief discusses the implementation of the new income definition--Modified Adjusted Gross Income or "MAGI"--that will be used to determine Medicaid income eligibility across the country in 2014 when the Affordable Care Act (ACA) takes full effect. The implementation of MAGI is complicated by the requirement that each state distinguish between two different eligibility groups that will garner different federal medical assistance percentages (FMAPs)--the "newly-eligible" expansion population and the "previously-eligible" population that would have met the state's pre-ACA income thresholds. This brief discusses the complexities that this scenario will raise for state Medicaid eligibility systems and how these issues might be addressed.