Erica Carter, a finance manager at an Omaha Nation school district in Nebraska, confronted a dilemma when her income as a disabled employee exceeded Iowa’s Medicaid eligibility thresholds. Carter, paralyzed since her early 20s, earned $110,000 annually, well above Iowa’s 2023 income limit of $36,450 for single disabled workers in the state’s Medicaid buy-in program. In November 2023, she received notification that her income disqualified her from coverage.
Medicaid buy-in programs, established by Congress in the 1990s to encourage workforce participation among disabled individuals, operate in 47 states but typically impose restrictions on income and assets. Carter faced an impossible choice: accept a significantly lower-paying position to maintain Medicaid benefits or forfeit coverage. She chose to leave the program and rely on her employer’s health plan, which proved inadequate for her disability-related needs. The decision has cost her approximately $35,000 annually in uncovered expenses, including nursing care, vehicle modifications, and wheelchair repairs.
Disability rights advocates argue that income and asset caps contradict the programs’ stated purpose of promoting employment. They contend these restrictions prevent disabled workers from pursuing raises, saving money, or achieving financial stability. Some states have responded: Massachusetts, Minnesota, New Jersey, and Rhode Island have eliminated such caps within the past five years. Iowa lawmakers attempted a more modest adjustment, proposing to raise the income limit to 300% of the federal poverty level, but the provision was stripped from legislation during the spring legislative session.
Policymakers face competing concerns regarding program expansion. Cost analysts worry that removing income limits could increase Medicaid spending, though researchers counter that enabling more disabled workers to earn sufficient income could generate tax revenue and reduce dependency on other assistance programs. Tennessee enacted a buy-in program without income or asset limits in 2024, pending federal approval. Some disabled Iowans, concerned about stagnant opportunities, have indicated potential relocation to states with more permissive policies.
Carter continues working multiple jobs to cover her medical expenses while contributing to her school district’s mission of supporting low-income students. Her situation exemplifies broader tensions between state fiscal constraints and the career aspirations of disabled workers navigating existing Medicaid frameworks.
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