A Medicaid Section 1115 reentry demonstration lets a state cover certain health services for people in jails, prisons and youth correctional facilities in the days before release, under CMS guidance and the state's own approved terms. This service is for correctional facilities, their health contractors and the community partners in an approved state who have to make those services work. Integral Healthcare Solutions (IHS) writes the reentry workflows and assigns each obligation across custody, provider and community teams; your clinicians own the care.
Last reviewed: October 2026. CMS guidance checked against the CMS reentry page, SMD 23-003 and the September 2026 reentry FAQs on October 2, 2026.
What is a Medicaid reentry Section 1115 demonstration?
CMS describes it this way: CMS "issued guidance for designing demonstration projects under section 1115 of the Social Security Act ... to improve care transitions for certain individuals who are soon-to-be former inmates of a public institution ... and who are otherwise eligible for Medicaid" (CMS reentry page).
Three federal documents frame the program, and a fourth set comes from your state:
- CMS State Medicaid Director Letter SMD# 23-003, "Opportunities to Test Transition-Related Strategies to Support Community Reentry and Improve Care Transitions for Individuals Who Are Incarcerated," April 17, 2023 (SMD 23-003).
- CMS "Frequently Asked Questions (FAQs) for Reentry Section 1115 Demonstrations," September 2026, which modifies SMD 23-003 for future approvals (CMS reentry FAQs).
- The CMS reentry demonstrations page, which lists the approved states (CMS).
- Your state's approved special terms and conditions and its Reentry Initiative Implementation Plan. These differ by state, and they are the text your facility is held to.
The September 2026 FAQs set the pre-release window for future approvals: "up to 60 days of pre-release coverage is appropriate for individuals in prisons, and jails, or adult tribal correctional facilities," and "CMS will continue to approve up to 90 days of pre-release services for individuals in youth correctional facilities" (FAQ Q2).
The FAQs also name a minimum benefit package (FAQ Q4):
- "Case management to assess and address physical and behavioral health needs, and social determinants of health;"
- "Medication-assisted treatment (MAT) services for all types of substance use disorders (SUD) as clinically appropriate, including coverage for medications in combination with accompanying counseling/behavioral therapies;"
- "A 30-day supply of all prescription medications, as clinically appropriate, that have been prescribed for the individual at the time of release, provided to the individual immediately upon release from the correctional facility".
Who needs it and what triggers it
The work starts when a facility sits in a state with an approved demonstration and has to go live with pre-release services and community handoffs. As of October 2, 2026, the CMS page's Approved States table lists Arizona, California, Colorado, the District of Columbia, Hawaii, Illinois, Kentucky, Louisiana, Maryland, Massachusetts, Minnesota, Montana, Nevada, New Hampshire, New Mexico, North Carolina, Oregon, Pennsylvania, Utah, Vermont, Washington and West Virginia (CMS reentry page).
Facility readiness is a named step. SMD 23-003 asks states to "Establish an assessment outlining how the state's Medicaid agency and participating correctional system/s will confirm they are ready to ensure the provision of pre-release services to eligible beneficiaries," and adds that "A state could phase in implementation of pre-release services based on the readiness of various participating facilities and/or systems" (SMD 23-003, milestone 5). A facility that is not ready may go live later than its neighbors.
The state also has to document its operations: "States are required to submit a Reentry Initiative Implementation Plan to document how the state will operationalize coverage and provision of pre-release services" (FAQ Q6). Facilities, health contractors and community providers carry out much of what that plan describes.
How IHS helps
IHS works from the state's approved terms and the CMS reentry guidance. The process:
- Gap assessment. IHS reviews the facility's intake, release planning and health records against the state's approved reentry terms and the CMS guidance, using questionnaires to custody staff, the health contractor and community partners.
- Responsibility matrix. IHS maps each obligation to the party that holds it: custody, the health contractor, the state Medicaid agency's process, or community providers.
- Drafted workflows. IHS drafts the eligibility-support, consent, pre-release service, medication continuity, referral and reporting workflows. Clinical content goes to the facility's physician for review and approval.
- Release-scenario walkthrough. IHS walks the team through release scenarios to test the workflows before go-live.
- Readiness support. IHS drafts readiness correspondence for the facility to send. Your facility submits; IHS drafts the text.
What you supply: the state's approved terms and any implementation guidance you have received, your current policies, staffing information, and access to your eligibility and billing staff.
The limit: IHS does not advise on Medicaid eligibility, billing or claims. Terms differ by state, and your state's terms control where they differ from the federal guidance quoted here. Related build work is described on our program development page.
What to have ready
- Confirmation that your state appears in the Approved States table on the CMS reentry page.
- Your state's approved special terms and conditions and its Reentry Initiative Implementation Plan, which states "are required to submit" (FAQ Q6, September 2026).
- Release-date data by facility type. The September 2026 FAQ (Q3) states the eligibility window as "an expected release date within 60 days from jails, prisons, and adult tribal correctional facilities, and within 90 days from youth correctional facilities"; your state's approved terms set the window that applies to you.
- Your current case management process, set against the first item of the minimum benefit package (FAQ Q4).
- Your current MAT policies for all types of substance use disorder (FAQ Q4).
- Your release-day medication process, set against the 30-day supply provided "immediately upon release" (FAQ Q4).
- Release procedures that show services do not hold anyone back. CMS states "under no circumstances should an individual's release from incarceration be delayed" because of these services or the policies built for them (FAQ Q4).
- Your facility's health-services contract. The demonstration "does not absolve correctional authorities in states of their Constitutional obligation to ensure needed health care is furnished to inmates in their custody" (FAQ Q6).
- A named lead for the state's readiness assessment, which SMD 23-003 milestone 5 asks states to establish (SMD 23-003).
- The names of the community providers and case managers who receive people at release.
To go through the list with IHS, book the introductory call below.
How it compares
Facilities and their partners are usually working in one of these settings. They are not exclusive.
| Setting | What the sources say |
|---|---|
| Facility-funded correctional health care with no demonstration | The demonstration "does not absolve correctional authorities ... of their Constitutional obligation" (FAQ Q6). In a state without an approval, this remains the arrangement. |
| State plan coverage under Section 5121 of the Consolidated Appropriations Act, 2023 | The FAQs state that the Section 5121 operational plan requirement "can be satisfied by the state's Implementation Plan" (FAQ Q6). We did not review the scope of Section 5121 itself for this page. |
| A Section 1115 reentry demonstration | Pre-release coverage for eligible people, the minimum benefit package and a state Implementation Plan (CMS reentry FAQs). |
| IHS gap assessment and drafting | A responsibility matrix, drafted workflows, a release-scenario walkthrough and drafted readiness correspondence. It does not replace your clinicians, your eligibility staff or your state's guidance. |
What it costs
CMS does not publish an application or participation fee for facilities on the pages we reviewed (the CMS reentry page, SMD 23-003 and the September 2026 FAQs); costs depend on scope, such as the number of facilities and partners. IHS scopes each engagement after a free introductory call.
What this is not
- This page is not legal advice, and IHS gives no advice on Medicaid eligibility, billing or claims.
- IHS does not contact, submit to or speak for your facility to the state Medicaid agency or CMS. IHS drafts; your facility sends.
- IHS does not provide or direct clinical care. Your physician approves the clinical content.
Frequently asked questions
What is a Medicaid Section 1115 reentry demonstration?
It is a demonstration project under section 1115 of the Social Security Act that CMS uses to improve care transitions for people soon to leave a public institution who are otherwise eligible for Medicaid. CMS set out its framework in SMD 23-003 (April 2023) and modified it for future approvals in reentry FAQs issued in September 2026. Each approved state operates under its own terms.
Is my state approved for a reentry demonstration?
As of October 2, 2026, the CMS reentry page lists Arizona, California, Colorado, the District of Columbia, Hawaii, Illinois, Kentucky, Louisiana, Maryland, Massachusetts, Minnesota, Montana, Nevada, New Hampshire, New Mexico, North Carolina, Oregon, Pennsylvania, Utah, Vermont, Washington and West Virginia. Whether a particular jail or prison takes part is set by the state's terms and its implementation plan.
How many days before release can Medicaid cover services for people in jail or prison?
For future approvals, the September 2026 CMS FAQs state that up to 60 days of pre-release coverage is appropriate for people in prisons, jails and adult tribal correctional facilities. CMS will continue to approve up to 90 days for youth correctional facilities. Your state's approved terms set the window that applies to you.
Does the 60-day limit apply to youth facilities and to states already approved?
No for youth facilities: the FAQs say CMS will continue to approve up to 90 days for youth correctional facilities. The 60-day statement is written for future approvals. The FAQ text we reviewed does not say how it affects demonstrations already approved, so check your state's terms.
What services must be in the minimum pre-release benefit package?
The FAQs list case management to assess and address physical and behavioral health needs and social determinants of health; MAT services for all types of substance use disorder as clinically appropriate, with accompanying counseling or behavioral therapies; and a 30-day supply of prescribed medications, as clinically appropriate, provided immediately upon release.
Who is eligible for pre-release Medicaid services in a correctional facility?
For approvals under the September 2026 FAQs, the FAQs say the person must be eligible for Medicaid, or eligible for CHIP but for incarceration status where applicable, and have an expected release date within 60 days from jails, prisons and adult tribal facilities, or within 90 days from youth facilities. IHS does not make eligibility determinations or advise on them. Whether the 60-day window reaches a state approved earlier is not stated in the FAQ text we reviewed; confirm in your state's terms.
What does a facility need in place before it can go live?
SMD 23-003 asks states to establish an assessment of how the Medicaid agency and participating correctional systems will confirm they are ready, and allows states to phase in facilities based on readiness. Your state's terms set the specific criteria. IHS's reading, as of October 2026, is that the minimum benefit package, release-day medication handling and the rule against delayed release are the operational areas the federal guidance names most specifically.
Does the reentry demonstration replace the facility's own duty to provide health care?
No. The CMS FAQs state the demonstration does not absolve correctional authorities of their Constitutional obligation to ensure needed health care is furnished to people in their custody.
Can pre-release services ever delay someone's release?
CMS states that under no circumstances should a person's release be delayed, or lead to increased involvement in the justice system, because a facility provides these services or because of policies built to implement the demonstration. IHS writes release workflows with that rule in view.