Iowa Medicaid income limits

Last verified: June 2026

Iowa Medicaid income limits by coverage group (2026 approximate)

Iowa uses MAGI income rules for the Iowa Health and Wellness Plan (IHAWP), children's Medicaid, and pregnant women's coverage. There is no asset test for MAGI-based programs. Long-term care Medicaid for seniors and adults with disabilities uses non-MAGI rules that include asset limits.

Iowa describes the IHAWP income limit as 133% FPL. This is because Iowa HHS, like the federal government, applies the 5% MAGI income disregard before comparing income to the 133% threshold — the practical eligibility ceiling is functionally equivalent to 138% FPL used by most other expansion states. This distinction matters when comparing Iowa's program against other states.

Source: Iowa HHS, hhs.iowa.gov/medicaid; 2026 HHS Federal Poverty Level guidelines. Iowa's IHAWP 133% FPL figure is as stated by Iowa HHS — the 5% MAGI disregard makes it equivalent to 138% in other expansion states. Iowa's pregnant women's limit at 375% FPL is notably high; verify this at hhs.iowa.gov/medicaid as it may be updated. Dollar figures are approximations.

No asset test for MAGI programs

IHAWP, children's Medicaid, Hawk-i, and the pregnant women's coverage group have no asset test. Savings, vehicles, and real property do not affect eligibility for these programs.

Iowa's MAGI calculation follows standard federal MAGI rules: wages, self-employment income, and most taxable income count. Child support received by custodial parents does not count. Irregular one-time income (tax refunds, gifts) generally does not count. If you are uncertain about a specific income source, apply and allow Iowa HHS to make the determination.

Iowa's 133% FPL vs. 138% FPL — why the difference matters

Iowa states its IHAWP income limit as 133% FPL rather than 138% FPL. The difference is a MAGI accounting convention. The ACA requires states to apply a 5% income disregard before testing income against the threshold — effectively, a state that uses 133% with the 5% disregard covers the same population as a state that uses 138% without naming the disregard separately. Iowa HHS explicitly describes the limit as 133% on its eligibility pages. Both approaches are federally compliant and result in the same practical coverage population.

How Medicaid income limits work

Medicaid eligibility is tied to the Federal Poverty Level (FPL), a measure the Department of Health and Human Services updates each January. States set their income limits as a percentage of FPL — so when FPL increases, the dollar thresholds for Medicaid also shift.

The Affordable Care Act established a standard income methodology called Modified Adjusted Gross Income (MAGI) for most Medicaid applicants. Under MAGI, the agency counts wages, salaries, self-employment income, Social Security benefits, and most other taxable income. Assets — a savings account, vehicle, home — are not counted for MAGI-based programs. That changed with the ACA and applies in all states.

States that expanded Medicaid under the ACA cover most adults at or below 138% FPL. In non-expansion states, income limits for adults without dependent children are far lower — sometimes as low as a few hundred dollars per month — or eligibility for that category simply doesn't exist.

What counts as income under MAGI

MAGI (Modified Adjusted Gross Income) is the income standard for most Medicaid applicants — children, adults under 65, pregnant women, and parents. It includes wages, salary, tips, self-employment income, unemployment benefits, Social Security retirement and disability benefits (SSDI), and most other taxable income.

It does not count child support received, gifts, loans, inheritances that are not generating income, or Supplemental Security Income (SSI) payments. One key MAGI rule: the ACA added a 5% FPL income disregard for most adults, which effectively raises the usable threshold by that amount. So a state with a 133% FPL limit effectively covers adults to about 138% FPL after the disregard.

Assets — a bank account, car, or home — are not counted for MAGI-based programs. That's a major difference from old-law Medicaid, where asset tests were common. If you previously didn't qualify because of assets, your eligibility may have changed after the ACA.

Asset limits and long-term care Medicaid

MAGI-based programs have no asset test. But Medicaid programs that cover long-term care — nursing home care, home and community-based services for seniors — use the old income and asset methodology, which does include asset limits.

Asset limits for long-term care Medicaid vary by state and are updated periodically. Generally, countable assets above the limit must be spent down before an applicant qualifies. Exempt assets — the primary home (in most circumstances), one vehicle, and certain personal property — are not counted.

Specific asset limits for Iowa's long-term care programs are on the seniors and long-term care page. The thresholds change, so verify current figures with Iowa Medicaid directly.