Translating Modified Adjusted Gross Income to Current Monthly Income

The ACA specifies a standard definition of income – Modified Adjusted Gross Income (MAGI) – that will be used to determine eligibility for both Medicaid and the Exchange-based premium tax credits and cost-sharing reductions. The adoption of MAGI creates a number of issues for states, particularly when applying MAGI to eligibility determination for Medicaid. In this brief, the author reviews the income that is included in MAGI and how income is currently counted in determining Medicaid eligibility. Issues related to measuring MAGI on a monthly basis for Medicaid eligibility determination are discussed, and the author offers some thoughts on how states might begin to address these issues in their application of MAGI to determine eligibility for Medicaid.