CMS Establishes Guardrails for Section 1115 Demonstrations for Justice-Involved Individuals in California Waiver

Executive Summary

Since Medicaid’s inception, the program has not covered services for any adult who is an “inmate of a public institution,.” However, CMS recently granted a first-of-its-kind section 1115 “reentry demonstration” in California, creating a temporary, limited carve-out to the “inmate exclusion.” Under the terms of the demonstration, California will be able to collect federal Medicaid matching funds for a specific set of “reentry services” provided to individuals in prisons, jails, and youth correctional facilities. While this approval marks a major change in Medicaid’s role in funding services in carceral settings, the approval contains at least five essential guardrails. CMS has indicated that the requirements included in the California approval letter provides a roadmap for how it will address pending and future requests for reentry demonstrations.

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