On July 30, 1965, Medicaid was signed into law alongside Medicare—two foundational pillars of President Lyndon B. Johnson’s “Great Society.” The “Great Society” platform was designed to combat poverty, advance racial equity and expand access to healthcare for millions of Americans. As we commemorate 60 years of Medicaid providing coverage to low-income children, pregnant women, adults, people with disabilities and seniors across all 50 states and five US territories, this milestone invites reflecting on its legacy and looking toward its future.
Understanding the Medicaid Program
Medicaid is jointly funded by the states and the federal government. States receive federal matching dollars for each dollar they spend on Medicaid, with a minimum match of 50%—meaning the federal government pays at least half of all Medicaid costs.
While the federal government sets baseline requirements for eligibility, coverage and benefits, states have the flexibility to exceed those minimums. As a result, no two state Medicaid programs are the same. This flexibility is a hallmark of Medicaid, empowering states to test innovative approaches that advance program goals. Over the years, states have used this flexibility to address social drivers of health, expand benefit offerings and tailor services to meet local needs.
Initially, Medicaid was limited to individuals receiving cash assistance, such as through the federal Supplemental Security Income program. Over time, eligibility expanded to include individuals with disabilities, children and pregnant women. In 1967, the Early and Periodic Screening, Diagnostic, and Treatment benefit was introduced to provide comprehensive healthcare for children and adolescents under age 21—including immunizations, regular check-ups and vision, hearing and dental services.
Other major milestones include:
- 1990: The Medicaid Drug Rebate Program was established to expand access to prescription drugs by requiring drug manufacturers to pay rebates to state Medicaid programs in exchange for coverage of their drugs.
- 1996: The requirement to receive cash assistance for Medicaid eligibility was removed.
- 1997: The Balanced Budget Act expanded states’ authority to enroll beneficiaries in managed care plans, leading to the widespread adoption of the Medicaid managed care model.
- 2010: The Affordable Care Act created a coverage pathway for non-disabled adults without dependents—often referred to as “childless adults.” A 2012 Supreme Court ruling made this expansion optional for states. To date, 40 states and Washington, D.C. have expanded Medicaid, resulting in lower uninsured rates, reduced uncompensated care and improved healthcare outcomes.
Most recently in 2025, the One Big Beautiful Bill Act introduced significant changes aimed at strengthening program integrity, reducing federal spending and ensuring that only eligible individuals are enrolled. These changes include:
- Implementing work requirements
- Imposing cost-sharing for certain enrollees and services
- Increasing the frequency of eligibility checks for expansion enrollees
- Revising how states can finance their share of Medicaid spending
These reforms are expected to reduce enrollment and increase fiscal pressure on state budgets.
Why Medicaid Matters
Medicaid ensures millions of Americans have access to the care and resources they need to lead healthy lives. Its impact is far-reaching:
- Approximately 71 million people—or more than one in five Americans—are enrolled in Medicaid.
- Medicaid pays for over 40% of all births in the U.S.
- It accounts for half of all spending on long-term services and supports.
- As of January 2025:
- 20.2% of the Maryland residents were covered by Medicaid
- 18.1% of Virginians were covered
- 34.2% of D.C. residents were covered
- As of July 2022, nearly 75% of Medicaid beneficiaries received care through Managed Care Organizations (MCOs), including CareFirst Community Health Plan Maryland (CHPMD).
CareFirst’s Commitment to Medicaid
CareFirst recognizes Medicaid’s vital role in advancing our mission: providing access to affordable, equitable and high-quality care to the communities we serve. Since 2020, CHPMD has proudly offered a comprehensive range of benefits and today serves 99,000 Marylanders statewide. Our MCO goes beyond clinical care to address the broader factors that influence health. From peer-driven communities and primary care engagement to a meals benefit to maternity members, CHPMD is committed to supporting the whole person.
Click here to learn more about CHPMD’s transformative programs.
Looking Ahead
This month, Governor Wes Moore declared July as Maryland Medicaid Month, celebrating the program’s profound impact on Marylanders and millions nationwide. With new changes on the horizon, now is the time to reflect on Medicaid’s importance and its role in shaping healthier communities.
As we look ahead, it’s essential that policymakers and healthcare leaders continue to recognize Medicaid’s vital role—and work together to preserve and strengthen the program for generations to come.