Medicaid is a joint federal and state health care program that is administered by state and local authorities and governed by both federal and state law. States must comply with federal Medicaid regulations to secure their share of federal Medicaid funding, but states can also add their own non-contradictory rules and procedures.
Medicaid rules provide both income and asset limitations on eligibility, meaning that the program is designed to pay for the healthcare of people who cannot otherwise afford their own healthcare. The exact income and asset limitations are governed by state rules. Medicaid benefits include health insurance paid for by the government (but administered by private insurance companies) and long-term care services, such as nursing home stays.
Federal law also requires a period of ineligibility for certain long-term care Medicaid benefits after a person gifts away assets, to prevent people from impoverishing themselves to immediately be eligible for long-term care Medicaid. If the government denies the Medicaid application or terminates somebody’s eligibility, the person is entitled to a “fair hearing” to contest the action in front of an administrative law judge.