When a person enters jail or prison, they lose more than their freedom. They often lose their health care. Because of a decades-old federal rule known as the Medicaid Inmate Exclusion Policy (MIEP), states are prohibited from using federal Medicaid funds to pay for most medical care for incarcerated people. With only narrow exceptions for inpatient hospital stays, this policy means that Medicaid coverage is suspended or terminated the moment someone enters the criminal justice system.
The results are predictable and devastating. People with mental illness or substance use disorders are already overrepresented in correctional settings, and they are cut off from care. When they reenter the community, they often do so without health coverage, medication and continuity of treatment. These gaps in care increase the risk of relapse, hospitalization or reoffending.
Research shows that nearly 70% of individuals released from prison reoffend within three years. While many factors contribute to recidivism, one of the clearest is untreated mental illness and addiction. Expanding access to behavioral health treatment is one of the most effective ways to interrupt that cycle. Studies have found that people who maintain insurance coverage after release are significantly less likely to return to prison and more likely to succeed in reentry.
Ending the inmate exclusion would be a powerful step toward that goal. If federal Medicaid funds were allowed to pay for preventive and routine medical care during incarceration, states could ensure continuity of treatment for people with chronic or behavioral health needs. This change would improve outcomes, reduce recidivism and ultimately save money by preventing costly hospitalizations and repeat incarcerations.
Congress should act to repeal the Medicaid Inmate Exclusion Policy outright. Doing so would remove an unnecessary administrative burden, including the constant suspension and reactivation of coverage, and allow correctional systems to focus on rehabilitation and treatment rather than paperwork. It would also signal a shift in how we view incarceration. Instead of treating prison as a place where people lose access to care, it would become an opportunity to stabilize health conditions that often fuel criminal behavior in the first place.
In the meantime, states do not have to wait. Roughly 1 in 4 states still terminate Medicaid coverage entirely when someone is incarcerated instead of merely suspending it. By adopting suspension-only policies, states can make sure coverage is reactivated immediately upon release. It is a simple, cost-effective reform that reduces red tape and ensures a smoother transition back into the community.
Importantly, under Section 1115 of the Social Security Act, states can apply for a waiver so that they can utilize Medicaid funds for projects designed to improve delivery of medical care to indigent populations. This has been one of the only areas that states can try to utilize funding in an indirect way to support its residents.
Virginia has successfully been approved for this waiver in the areas of adolescents and substance abuse. However, it does not cover all of the serious mental illness population which tends to be a significant proportion of the population negatively impacted by recidivism. It is well known, without the needed continuity of care between incarceration and re-acclimation back into society, the serious mental health population is left vulnerable and decompensation soon follows.
Whether through federal repeal or state-level reform, the message should be clear. Access to health care should not stop at the prison gate. If we are serious about improving public safety, reducing recidivism and addressing the behavioral health crisis that fills our jails and prisons, we must end the Medicaid Inmate Exclusion Policy. States should not be burdened with finding work-arounds for inhumane policies.
Peter Breslin, M.D., FAPA, of Glen Allen is double boarded in psychiatry and addiction medicine. He was appointed to the Virginia Addiction Recovery Council by Gov. Ralph Northam, was recognized by Richmond Magazine as a Top Doc, and has served as a board member and medical advisor to the McShin Foundation and other recovery community organizations in Virginia.
