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States Have New Options to Improve the Health of People Leaving Jails and Prisons

Photo, man folds clothes in dark closet

Raymond Girtley, 65, sorts clothing at the offices of The First 72+, a reentry agency founded and operated by formerly incarcerated people, in New Orleans on May 24, 2021. People leaving incarceration face elevated health risks compared with people who have never been incarcerated. Photo: Edmund D. Fountain for the Washington Post via Getty Images

Raymond Girtley, 65, sorts clothing at the offices of The First 72+, a reentry agency founded and operated by formerly incarcerated people, in New Orleans on May 24, 2021. People leaving incarceration face elevated health risks compared with people who have never been incarcerated. Photo: Edmund D. Fountain for the Washington Post via Getty Images

  • New Medicaid flexibility will allow states to use Medicaid funding to provide health care services to justice-involved people, supporting healthier and safer reentry into communities

  • Medicaid has historically been barred from covering care except inpatient hospitalizations for people who are incarcerated, but that may change under a new Medicaid waiver opportunity

The health and safe transitions of incarcerated people have been a focus of work by Congress, the Biden administration, and states.1 People leaving incarceration face elevated health risks, including disproportionately higher rates of chronic conditions (such as diabetes, hepatitis, and hypertension), behavioral health diagnoses, as well as higher rates of overdose and suicide compared with people who have never been incarcerated. While many incarcerated individuals — who, because of systemic inequities in our criminal justice system, are more likely to be people of color — may qualify for Medicaid, inpatient hospital care was, until recently, the only service that could be covered under Medicaid while an individual was incarcerated, because of a federal provision known as the “inmate exclusion.”

Section 1115 Medicaid waivers can provide a path forward. On April 17, the Centers for Medicare and Medicaid Services (CMS) released new guidance, outlining opportunities for states to use state and federal Medicaid funding to provide prerelease health care services to Medicaid-eligible individuals, with a focus on improving health at reentry into communities.

Approvable demonstrations are expected to focus on: improving continuity of care in communities after release; strengthening coordination between correctional facilities and community-based health care providers; and reducing deaths, emergency department visits, and inpatient hospitalizations after incarceration. Currently, California has such a waiver in place and more than a dozen states have requests pending with CMS.2 The published guidance follows the framework approved in California, while allowing flexibility for states to design their own approaches, consistent with CMS goals and guardrails.

The guidance outlines the following elements:

  • Eligible facilities. States may provide prerelease services in all or a subset of state and local correctional facilities.
  • Eligible populations. States may define their target populations. For example, states may provide services to all Medicaid-enrolled individuals in target facilities or narrow eligibility, for example, to cover individuals with mental illness, substance use disorder, or chronic conditions only.
  • Minimum covered prerelease services. At a minimum, states must provide:
    • Case management focused on helping people receive needed services when they reenter their communities. This includes conducting a comprehensive needs assessment, developing a care plan, ensuring the provision of prerelease services, executing a warm handoff to a postrelease/community-based care manager (if different from the prerelease care manager), and making critical connections for postrelease care. This could include sharing information and making appointments with providers in the community.
    • Medication-assisted treatment (MAT) for all types of substance-use disorders with accompanying counseling therapies, as appropriate. The guidance reminds states that coverage of MAT under the State Plan includes all U.S. Food and Drug Administration–approved medications for opioid-use disorder, including buprenorphine, methadone, naltrexone, and acamprosate and naltrexone for alcohol-use disorder. The guidance encourages states to use the medication most appropriate for each individual.
    • 30-day supply of all prescription medications provided in-hand at the point of release.
  • Additional allowable services. States may cover additional services, including family planning, treatment for hepatitis C, medications for all physical and behavioral conditions during the prerelease period,3 and provision of durable medical equipment (e.g., wheelchair, oxygen tanks) upon release.
  • Eligible providers. Prerelease services can be provided through community-based providers (in-person or via telehealth), carceral health providers, or a combination thereof. If a state relies on carceral providers, it will need to outline processes to ensure timely connections to community-based providers. CMS suggests the best practice of using trained peers or community health workers with similar lived experiences to promote high-quality, equitable care.
  • Time period for covering prerelease services. States may provide coverage of prerelease services for up to 90 days before the expected date of release. To date, states have proposed prerelease time periods ranging from 30 to 90 days.
  • Medicaid eligibility and enrollment. Prerelease services under the demonstrations are limited to people who are enrolled in Medicaid and qualify as a target population based on the state’s eligibility criteria. As a condition of waiver approval, CMS will require states to establish processes to ensure only allowable benefits are covered during incarceration but that full benefits are available without delay upon release. Many states already have a “suspension” procedure to limit coverage payments during incarceration, but delays in removing the suspension status can result in coverage delays upon reentry. States that do not have policies in place to limit payment during incarceration and turn on full benefits upon reentry will be provided with a two-year implementation glide path.
  • Implementation and reinvestment plan. Once approved, states must submit an implementation plan, including timelines for meeting specific milestones. States that seek federal financing for existing carceral health care services (e.g., prerelease medications) that are currently funded with state or local funds must reinvest funds to benefit the population.4
  • Enhanced IT system and capacity-building funds. States may leverage enhanced federal matching funds for IT systems. CMS also will provide time-limited waiver financing for capacity building (such as hiring and training staff or IT system updates) and implementation planning.5

Looking Ahead

States are moving forward with initiatives, aligned around the goal of using Medicaid funds to provide prerelease services that will improve health outcomes and address racial and ethnic disparities. Implementation will be challenging as Medicaid agencies, state and local corrections agencies, community health providers, and advocates have traditionally been siloed in this work and will need to develop data systems (e.g., EHRs, billing/claiming systems) that can work together. These efforts, supported by CMS guidance and federal financial support, could improve the health and lives for an at-risk population.

  1. SUPPORT for Patients and Communities Act, H.R. 6, 115th Cong. (2018); Consolidated Appropriations Act, 2023, H.R. 2617, 117th Cong. (2022); Office of the Assistant Secretary for Planning and Evaluation, Report to Congress — Health Care Transitions for Individuals Returning to the Community from a Public Institution: Promising Practices Identified by the Medicaid Reentry Stakeholder Group (ASPE, Jan. 2023); and Cindy Mann, Kinda Serafi, and Virginia E. Morgan, “States Push for Innovative Ways to Improve Health Outcomes for Justice-Involved Individuals,” To the Point (blog), Commonwealth Fund, Sept. 13, 2022.
  2. States include Arizona, Kentucky, Massachusetts, Montana, New Hampshire, New Jersey, New Mexico, New York, Oregon, Rhode Island, Utah, Vermont, Washington, and West Virginia.
  3. States that do not provide all covered outpatient drugs during the prerelease period may not seek federal or supplemental state-specific rebates under Section 1927 for any of the prerelease drugs covered under the demonstration.
  4. The guidance makes clear that the state share of the Medicaid funding for new services is considered when reinvestment obligations are calculated.
  5. In California’s reentry waiver, CMS approved $410 million in capacity-building funds to support investments in personnel, capacity, and/or IT systems that are needed for collaborative planning and implementation in order to effectuate prerelease service processes.

Publication Details



Kinda Serafi, Partner, Manatt Health


Kinda Serafi, Virginia E. Morgan, and Cindy Mann, “States Have New Options to Improve the Health of People Leaving Jails and Prisons,” To the Point (blog), Commonwealth Fund, Apr. 25, 2023.