Last Thursday, the Department of Health and Human Services (HHS) released new guidance to clarify and update policies related to how states can improve access to Medicaid coverage and services for incarcerated individuals transitioning back into communities. Based on data from a newly published HHS report, currently 2.2 million individuals are incarcerated and an additional 4.7 million are on probation or parole in the U.S. Further, over 95 percent of incarcerated individuals will eventually be released to the community. As many of these individuals are now eligible for Medicaid through the ACA, these new federal guidelines provide important parameters for states to help connect justice-involved individuals to physical and behavioral health services critical to their successful reentry into the community.
Previous federal guidance did indicate that Medicaid-eligible individuals who become incarcerated retain their eligibility and can be enrolled in the program. (Existing federal law prohibits using federal Medicaid funds to pay for medical care provided to incarcerated individuals, unless the individual is admitted to an inpatient facility for at least 24 hours.) However the newly issued guidance explicitly defines who is considered to be an inmate of a public institution. It also clearly delineates that states must accept Medicaid applications from incarcerated individuals, and if they are determined to be eligible they may be enrolled in Medicaid while they are inmates of a public institution. States can either place the enrolled individual in a suspended eligibility status during the incarceration period, or can create claims processing markers to limit Medicaid billing to only qualifying inpatient services.
The guidance also reinforces that individuals who are on parole, probation, under home confinement, or are in the community awaiting trial are not considered to be inmates of a public institution. Consequently these individuals can receive Medicaid-covered services and Federal Financial Participation (FFP) is available for these services.
Other key points from the guidance include:
- FFP and Medicaid coverage are available for eligible individuals residing in state or local corrections-related community residential facilities (such as halfway houses), as long as individuals have freedom of movement while living at the facility, defined by criteria identified in the guidance.
- FFP is not available for health care services provided to individuals in residential reentry centers that are operated by the Department of Justice’s Bureau of Prisons.
- FFP is not available for mental health or substance use disorder services provided to inmates involuntarily residing in residential treatment facilities, as these are considered to be correctional institutions.
The guidance strongly encourages state Medicaid agencies and correctional institutions to work together to enroll eligible justice-involved individuals in Medicaid. It also provides clarification on interstate Medicaid application processes, such as how state agencies should handle Medicaid coverage when incarcerated individuals are transferred to other states or move to another state upon release.
HHS also notes that states can encourage or require Medicaid managed care entities to coordinate with corrections agencies to promote access to care for individuals reentering the community. Further, the guidance indicates that federal matching funds are available to states for application assistance, eligibility determination, and enrollment system upgrades, as well as to transfer medical records from correctional institutions to community health care providers to promote care continuity.
For more information, see the HHS press release here. For resources about justice-involved individuals and health coverage, see NASHP’s toolkit featuring states’ efforts to enroll justice-involved individuals in Medicaid.