What is the name of the income measure used to determine eligibility for Medicaid and CHIP and the cost of subsidies for purchasing insurance on exchanges?

• A. Capitation
• B. MCOs
• C. HRRP
• D. Federal Poverty Level

Answer: (D)

The measure is the Federal Poverty Level. This standard expresses income relative to family size and is updated annually by the federal government. Medicaid and CHIP use the FPL (often as a percentage of it) to determine who qualifies, and premium subsidies for insurance purchased on exchanges are calculated based on where a household’s income falls in relation to the FPL. The other terms refer to different concepts—capitation is a fixed per-patient payment method, MCOs are managed care organizations, and HRRP is a hospital readmissions penalty program—which do not describe income-based eligibility thresholds.