Medicaid Prescription Copays: What States Can Charge

States can charge Medicaid enrollees a copay for prescriptions, but federal rules cap those amounts, generally at $4 for a preferred drug and $8 for a non-preferred drug for people at or below 150 percent of the federal poverty level (Medicaid.gov). Several groups, including children and pregnant women, are exempt from copays entirely. Because coverage and copay amounts still vary by state and by plan, it is worth comparing prescription prices for any medication your specific state's Medicaid program treats as non-preferred.

Federal limits on Medicaid drug copays

Medicaid cost-sharing rules for prescription drugs come from 42 CFR 447.53, which sets maximum allowable nominal copay amounts based on a beneficiary's income relative to the federal poverty level (FPL):

These are federal ceilings, not requirements. States may set copays lower than the maximum, or choose not to charge copays at all (42 CFR 447.53). Nominal cost-sharing amounts are adjusted periodically based on medical inflation, so exact figures can shift slightly year to year.

States decide which drugs count as "preferred" versus "non-preferred" through their own Medicaid preferred drug lists, similar in concept to a private insurance formulary. A drug that is non-preferred in one state's Medicaid program might be preferred in another, so your actual copay depends on where you live and your specific state's drug list.

Who is exempt from Medicaid prescription copays

Federal law exempts several groups from Medicaid cost sharing entirely, regardless of income, according to CMS's cost-sharing rules and analysis from MACPAC (MACPAC):

• Children and youth under 21, in most Medicaid eligibility categories, depending on state policy.
• Pregnant women, including through the postpartum period, for pregnancy-related drugs.
• Individuals who are inpatients in a hospital, nursing facility, or other medical institution.
• People receiving hospice care.
• Certain American Indian and Alaska Native beneficiaries who have used services from an Indian health care provider.
• Family planning drugs and supplies, which cannot carry a copay for any enrollee.

If you fall into one of these categories but are still being charged a copay at the pharmacy, it is worth asking your state Medicaid agency or pharmacist to double check how the claim was processed.

The 5 percent household cap

Federal rules also cap total Medicaid cost sharing, combining premiums and copays for every household member, at 5 percent of the family's monthly or quarterly income (MACPAC). States are required to track this using a method that does not rely on the beneficiary keeping their own records, and must notify both beneficiaries and providers once a household reaches the cap. After that point, no further cost sharing can be charged for the rest of that month or quarter.

Can a pharmacy refuse to fill a prescription over an unpaid copay

No. Federal rules prohibit Medicaid providers, including pharmacies, from denying a covered service solely because a beneficiary cannot pay the required copay (Medicaid.gov). The pharmacy can still record the amount owed and attempt to collect it later, but it cannot refuse to dispense a covered medication on that basis alone.

Compare prescription prices on BetterBuyRx if a specific drug is listed as non-preferred under your state's Medicaid formulary, since a preferred alternative or a different pharmacy's cash price might end up costing less than the non-preferred copay.

What is changing for some states starting 2028

Recent federal reconciliation legislation includes a provision allowing states to charge cost sharing of up to $35 per service for certain non-exempt Medicaid expansion adults with income between 100 and 138 percent of the federal poverty level, starting in October 2028 (KFF). This applies to specific services rather than a blanket prescription copay change, and primary care, preventive services, mental health, substance use treatment, and services at federally qualified health centers are expected to remain exempt. Because implementation details are still developing, check directly with your state Medicaid agency for the most current rules that apply to you.

How dual-eligible beneficiaries are handled differently

People enrolled in both Medicare and Medicaid, often called dual-eligible beneficiaries, generally get their drug coverage through Medicare Part D rather than Medicaid, since Part D became the primary payer for most outpatient prescription drugs for this group when it launched. Full-benefit dual eligibles typically qualify automatically for the Extra Help low-income subsidy, which caps their Part D copays at a few dollars per prescription, often lower than a state's standard Medicaid preferred-drug copay would have been (Medicaid.gov). Medicaid may still cover certain drugs or drug categories that Part D excludes from its formulary, such as some over-the-counter products a state chooses to cover. If you are dual-eligible and unsure which program is billing for a specific prescription, your pharmacist can tell you which coverage was used for that fill.

How to check your specific state's rules

Because Medicaid is state-administered, exact copay amounts and preferred drug lists vary widely. Steps that help:

• Check your state Medicaid agency's website for its current preferred drug list and cost-sharing schedule.
• Ask your pharmacist directly what your copay is for a specific medication before you fill it.
• If a drug is non-preferred, ask your doctor whether a preferred, clinically appropriate alternative is available.
• If you also have Medicare, review how Medicaid copays interact with Medicare's Extra Help program, since dual-eligible beneficiaries are generally subject to different, often lower, cost-sharing rules.

Search your medication on BetterBuyRx to compare cash prices at nearby pharmacies, particularly useful if a drug falls outside what your state Medicaid program covers or covers only at a higher, non-preferred cost-sharing tier. You can also check how pharmacy prices compare near you for any drug not on your state's preferred list.