MAGI is known as modified adjusted gross income. With the Affordable Care Act (ACA)it provides an easier way to calculate income eligibility for Medicaid through the insurance marketplace. The Affordable Care Act (ACA) has actually made it possible for more individuals to be on Medicaid.

MAGI (modified adjusted gross income) is the numerical figure that is used to determine eligibility for premium tax credits and other additional savings for health insurance marketplace plans as well as for Medicaid and the Children’s Health Insurance Program (CHIP).  MAGI replaces the previous method in calculating Medicaid eligibility, that used income deductions that are different in each state and differ by eligibility group. MAGI applies to individuals who are eligible for Medicaid and the Children’s Health Insurance Program (CHIP), but not for the elderly (65 and older) or those individuals who qualify based on disability.

By using income eligibility guidelines across all insurance affordability programs it makes it more accessible for individuals to apply for health coverage through one dashboard to enroll in suitable programs that meet their needs. However, MAGI does not include Supplemental Security Income (SSI). Keep in mind that states can adjust standards as long as they do not reduce eligibility levels below minimum standards established by the law.

For more information and clarification visit the Centers for Medicare and Medicaid Services website