"Cage-free" chicken comes from birds that were, quite simply, not kept in cages. They were free to walk around the hen house, to perch on roosts, and to lay eggs in nests. "Cage-free" does not denote anything about the feed or other physical care of the chickens. If you're concerned about what the chicken ate, look for organic chicken or pastured chicken.
This "cage-free" life is, however, in great contrast to most chickens, which are kept in cages so small that they can't fully open their wings, much less walk or move about. "Cage-free" chicken is also fairly widely available at mainstream grocery stores and it's a solidly better choice than most commercial/industrial chicken.
That said, "cage-free" chickens are kept in hen houses, often in cramped conditions, and may or may not have access to the outdoors or real fields and pasture.