Medicaid is definitely different from state to state. I work at a hospital in Virginia and we can only see patients from Virginia and West Virginia. West Virginia is covered in Virginia because they have such limited options for medical care in parts of their state - many of them drive 6+ hours to see us. Otherwise, no other state's Medicaid program is accepted in our state. Additionally, there have been recent changes to Medicaid programs and many states are now contracting Medicaid benefits with regular HMO companies. (Medicare is different - that's generally what we all get when we're 65 and over. That works anywhere in the country.)
I do know that Medicaid even pays for Viagra, so I would be really disgusted if they didn't cover something like banding. I would do what someone advised above - call the number on your card and ask a) if bariatric surgery is covered and b) which providers in your state participate.
Good luck