New Prison Medicaid Waiver Offers Opportunities, Challenges for MCOs

The Biden administration will make Medicaid coverage available to incarcerated people for the first time through a new category of Section 1115 waivers, building on a demonstration program that has been active in California since January. Experts tell AIS Health, a division of MMIT, that the waiver poses notable challenges to Medicaid managed care organizations, which will have to coordinate with the carceral system and community providers to meet the needs of a disproportionately vulnerable and sick population.

States that apply for the waiver, dubbed the Reentry Section 1115 Demonstration Opportunity, will provide Medicaid coverage to incarcerated people who are on the verge of returning to the community. According to an HHS press release, states will be allowed “to cover a package of pre-release services for up to 90 days prior to the individual’s expected release date that could not otherwise be covered by Medicaid.” The package of services includes providing formerly incarcerated people with a 30-day supply of medication on release, case management, and medication-assisted treatment (such as prescribing methadone) for substance use disorder (SUD).

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