Advancing Medicaid Reentry Initiatives: Early Implementation Successes

Introduction

States have made remarkable progress in designing and launching Medicaid reentry initiatives—coordinated pre-release strategies that use Medicaid authority to connect individuals leaving incarceration with coverage, care, and critical supports to ensure a more stable transition back into the community. The Consolidated Appropriations Act (2023 and 2024 CAA) and the Centers for Medicare and Medicaid (CMS) Reentry Section 1115 Demonstration opportunity have created new, federally authorized pathways to expand pre-release services and strengthen transitions from incarceration back to the community.¹ The true story, however, lies in the day-to-day complex work states and their partners have done to translate these opportunities into practice. States have needed to construct entirely new workflows for Medicaid eligibility and enrollment, pre-release clinical service delivery, care coordination, data sharing and community handoffs—often across dozens of jails, prisons and youth facilities that vary widely in infrastructure and readiness. As early-implementer states go live and begin serving individuals, their experiences are already generating important lessons that are shaping a more coordinated, health-focused reentry process nationwide. Even as states face fiscal pressures and adapt workflows to meet H.R. 1 requirements, including implementing work reporting requirements, many remain steadfast in their commitment to launching and sustaining reentry services, reflecting a growing recognition of the essential role these initiatives play in improving health outcomes and promoting long-term stability for justice-involved individuals.

Implementation Update

As of November 2025, CMS has approved Reentry Section 1115 Demonstration in nineteen states,² with nine additional applications pending.^{3 , 4 , 5}

Early adopter states have launched demonstration services across a wide variety of facility types. California began implementation across participating counties and state prisons in October 2024.⁶ New Hampshire launched its program on January 2025 in its state prisons and Washington initiated a phased cohort model that began in July 2025. Most recently, Montana announced the launch of reentry services across three state prisons.

In addition to the Demonstration activity, all states are working to implement mandatory Section 5121 CAA requirements through state plan amendment (SPA) authority that articulate structured timelines to reach full statewide implementation.⁷

Early Implementation Successes

States vary widely in their readiness for implementation. Some states have fully launched programs, while others are delivering services, though the correctional facilities have not yet begun billing the state. Several others are still developing policy and operational guidance while providing technical assistance to their implementation partners.

Despite the variation in states' stages of implementation, there are several clear areas of early success emerging across demonstration and CAA implementation efforts, including:

• Strengthened partnerships across Medicaid agencies, correctional facilities, managed care plans and community-based providers. To enable these new types of connections, many states have established regular advisory groups and stakeholder workgroups to guide implementation. For example, California, Nevada, Michigan and Massachusetts all set up advisory groups to provide input on the states' reentry policy and operational approach. These partnerships enable coordinated communication and sustained engagement across implementation partners that have historically operated in silos.
• Improved Medicaid enrollment and suspension processes, including the use of real time data exchanges and facility-based workers assisting with Medicaid applications. These improvements ensure that individuals are consistently enrolled—or reinstated—prior to release, reducing gaps in coverage that had previously resulted in delayed access to essential medications, behavioral health services and primary care. As required by the CAA, all states must implement suspension (instead of termination) processes for all incarcerated enrollees, beginning January 1, 2026, which is also a condition of states' Reentry Demonstration approval. Long before the federal suspension requirements were enacted, Arizona's Medicaid agency was a national leader in leveraging daily data exchanges between correctional facilities and the Medicaid agency to ensure coverage is suspended or reinstated upon notification of incarceration status.⁸ The focus on ensuring Medicaid is active as soon as the individual is eligible allows states to best support their members while also maximizing access to federal Medicaid funds.
• Increased continuity of care through new connections with community-based providers. States are building pre-release referral pathways that allow individuals to meet their future providers before release, strengthening trust and improving the likelihood of post-release engagement. For example, in North Carolina, youth detention centers are partnering with community health centers to provide the required CAA screening and diagnostic services. Prior to a youth's release, a care coordinator schedules an appointment with a community health center located near the youth's anticipated residence, facility staff transport the youth to that appointment and, after release, the individual can continue receiving care from the same provider in the community.
• Increased continuity of behavioral health treatment, particularly for individuals receiving medications for opioid use disorder (MOUD), with pre-release medication planning and warm handoffs to community providers. This continuity is critical because individuals with untreated or interrupted behavioral health and substance use conditions face sharply elevated risks of overdose, relapse, and acute psychiatric crises immediately after release. ^9,10,11 Recognizing the importance of implementing a strong and standardized reentry MOUD program, Washington's Medicaid agency developed a simplified reference tool for correctional facilities that provides standard care guidelines for treating incarcerated individuals with an opioid and/or alcohol use disorder.¹² This tool was reviewed and approved by the Washington Association of Sheriffs and Police Chiefs, further highlighting Washington's commitment to build strong partnerships with all implementing partners.
• Built a continuity-driven case management approach that begins pre-release and ensures warm handoffs and sustained support in the community. Case management is an anchor reentry service designed to assess an individual's physical and behavioral health needs prior to release and facilitate connections to services once they return to the community. Vermont is implementing a community-based in-reach case management approach to promote continuity of care throughout the pre-release and immediate post-release period; the Vermont Chronic Care Initiative (VCCI) will be the lead case management entity providing these services.¹³ States that have allowed correctional facilities to conduct pre-release case management have implemented requirements that include a warm hand-off between the pre-release case manager and the post-release case manager. Additionally, several states have sought and received CMS approval to cover community health worker and peer support specialist services, expanding the availability of culturally grounded, community-based supports to assist individuals during reentry.¹⁴
• Implemented coordinated data-sharing frameworks that link correctional, Medicaid, managed care, and community providers to inform post-release care. This type of data exchange allows for connections between systems that are traditionally siloed to better inform post-release care and shed light on an individual's health needs that would otherwise be unknown to post-release care manager and community-based providers. For example, to support these connections, California created a data sharing advisory group with members from various implementing partner groups to develop a data sharing toolkit to support eligibility and enrollment processes and service delivery between the Medicaid agency, correctional facilities, managed care plans, and community-based providers. California also created a Memorandum of Understanding template between their managed care plans and correctional facilities to establish clear expectations for care coordination and to improve communication pathways.

Looking Forward

The CAA requirements along with Reentry Section 1115 demonstrations will transform how Medicaid supports individuals during the transition from incarceration back into the community. As states move from design to full-scale implementation, these initiatives will expand access to pre-release services, deepen coordination across correctional and health systems and strengthen continuity of coverage and care during the highest risk period following release. Early experiences from pioneering states and eventual Demonstration evaluations will offer critical insights into effective models—guiding federal and state policymakers as they refine, sustain and scale reentry initiatives nationwide. Together, these efforts lay the groundwork for reentry processes that improve health outcomes and support long-term stability for justice-involved individuals.

Footnotes

1 Section 5121 of H.R.2617 - Consolidated Appropriations Act, 2023 (Public Law No: 117-328). Available here; Section 205 of H.R.4366 - Consolidated Appropriations Act, 2024 (Public Law No: 118-42). Available here; SMD# 23-003 RE: Opportunities to Test Transition-Related Strategies to Support Community Reentry and Improve Care Transitions for Individuals Who Are Incarcerated. (4/2023). Available here.

2 Approved states include Arizona, California, Colorado, Hawaii, Illinois, Kentucky, Maryland, Massachusetts, Michigan, Montana, New Hampshire, New Mexico, North Carolina, Oregon, Pennsylvania, Utah, Vermont, Washington and West Virginia.

3 States with pending waivers include Nevada, Minnesota, Arkansas, Louisiana, New Jersey, New York, Connecticut, Maine and Washington, D.C.

4 As part of its September 2022 Medicaid Redesign Team (MRT) 1115 Waiver Amendment, New York requested CMS approval for coverage of certain services provided 90-days pre-release. This request is still pending CMS approval.

5 On June 5, 2025, Rhode Island withdrew their request for expenditure authority to provide pre-release supports and Medicaid coverage for incarcerated Medicaid-enrolled adults and youth 90 days prior to returning to the community. Available here.

6 California publishes an updated list on county readiness and go-live status. Available here.

7 Additional guidance on SPA processes and timelines available here. SPA templates available here.

8 Urban Institute. (2018). Connecting criminal justice-involved people with Medicaid coverage and services: Innovative strategies from Arizona. Urban Institute. Available here.

9 BMC Emergency Medicine. (2013). Incarceration and health: A literature review. BMC Emergency Medicine, 13(16). Available at: https://bmcemergmed.biomedcentral.com/articles/10.1186/1471-227X-13-16. 22

10 American Academy of Family Physicians. Incarceration. AAFP Policies. Available here.

11 Kaiser Family Foundation. (2019). How connecting justice-involved individuals to Medicaid can help address the opioid epidemic. KFF Issue Brief. Available at: https://www.kff.org/medicaid/issue-brief/how-connecting-justice-involved-individuals-to-medicaid-can-helpaddress-the-opioid-epidemic/.

12 Washington's "Medications for opioid use disorder (MOUD) and medications for alcohol use disorder (MAUD) in jails: Standard of care guidelines" is available here.

13 Vermont Agency of Human Services Presentation (2024).

14 States with CMS approval for Community Health Worker Services include CA, IL, MA, NM, OR, UT and WA; states with CMS approval for Peer Support Services include AZ, HI, NH, NM, OR, UT and VT.

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