The U.S. Department of Health and Human Services (HHS) this week announced its approval of Vermont’s application to provide Medicaid coverage for individuals transitioning out of incarceration.
As outlined in the federal waiver, sentenced incarcerated individuals will become eligible for Medicaid 90 days before their release. Currently, incarcerated individuals are ineligible for Medicaid, regardless of economic situation, until they return to the community. Officials say the initiative will enhance continuity of care and support a more seamless transition back to Vermont’s communities.
“Extending Medicaid eligibility to individuals as they transition out of incarceration signals a paradigm shift in how communities approach public health and safety,” said Nicholas Deml, Commissioner of the Department of Corrections. “This initiative recognizes incarcerated people in Vermont deserve access to the same fundamental benefits that exist in our communities. It is exactly this kind of deep partnership between community providers and corrections that will make our communities healthier, safer, and help our state address the complex public health challenges Vermont faces today.”
Health officials say the expansion will allow for increased coordination between correctional facilities and community health providers to ensure access to chronic care, health interventions, and substance use treatment upon reentry. This is a critical time for individuals exiting incarceration.
“The Biden-Harris Administration is working to ensure every American has access to high-quality, affordable health care. This is an essential step for advancing health equity in our nation,” said HHS Secretary Xavier Becerra in a release announcing the federal approval. “For people involved in the justice system, ensuring a successful transition back into the community includes having the health care supports and services they need. I’m pleased to see more and more states putting resources behind efforts that will ensure these individuals have what they need to thrive.”
Vermont plans to launch the expanded coverage in 2026 to allow time to develop federally required implementation and monitoring plans, establish significant IT infrastructure, and work on staff recruitment and training for the new case management services. Vermont’s Agency of Human Services, Department of Corrections, and Department of Vermont Health Access are collaboratively leading the implementation plan and benefit rollout ahead of 2026.
“This demonstration marks the first time the federal government is investing Medicaid dollars in Vermont correctional settings, signaling a meaningful shift in U.S. policy to prioritize whole-person care, regardless of setting, and to promote successful transitions back to community for incarcerated individuals. Every federal Medicaid dollar received under this demonstration will be reinvested into efforts to increase health care services for individuals who are incarcerated. These investments will go towards initiatives to improve care coordination, mental health services, and substance use disorder treatment in correctional facilities or upon release” said AHS Medicaid Director, Monica Ogelby.