Officials outline plan to begin Medicaid reentry payments for incarcerated Vermonters Jan. 1, 2026

Agency of Human Services officials told the House Corrections and Institutions Committee on April 16 that Vermont is preparing to begin Medicaid reimbursement for health care provided to eligible sentenced (adjudicated) individuals during the 90 days before release, with a target launch date of Jan. 1, 2026.

Ashley Berliner, director of Medicaid policy at the Agency of Human Services and the state official overseeing the Global Commitment 1115 demonstration, told the committee the state received federal reentry‑waiver authority in July 2024 and is “aiming to launch the first Medicaid dollars flowing through correctional facilities on 01/01/2026.” She described the project as “an enormous undertaking” that requires changes to eligibility and claims systems and new case management workflows.

Under the reentry model discussed, Medicaid reimbursement will apply to those who are sentenced (adjudicated); individuals who are detained but not sentenced will receive equivalent services from DOC but are not eligible for the Medicaid match. The waiver allows the Department of Corrections to receive federal Medicaid funds for covered health care delivered during a 90‑day prerelease window for eligible individuals; the state also plans to deploy Vermont Chronic Care Initiative (VCCI) caseworkers to coordinate prerelease and postrelease care. Berliner said the state intends to place one VCCI caseworker per facility (six total) to help schedule appointments, coordinate treatment, and assist with enrollment and reentry planning.

A central technical task is moving the Agency’s eligibility system from termination to suspension for incarcerated enrollees. Berliner explained that the current system often terminates Medicaid eligibility when incarceration is reported; the team is building suspension functionality so coverage can be paused while a person is incarcerated and reactivated on release. That change, and the claims‑processing path that allows DOC to bill Medicaid for the prerelease window, requires integration among multiple systems: DOC’s Wellpath electronic health record, the state MMIS claims processor, and the Optum eligibility engine.

Committee members asked about workflow, social security numbers on intake forms, and how the processes will operate for detainees and for long sentences. Berliner said the team is still designing the intake and workflow split between DOC caseworkers and VCCI staff; VCCI will be brought into facilities where appropriate and will be able to work by telehealth or in person depending on individual preference and facility logistics. The committee requested intake/booking forms and a clear delineation of responsibilities as the IT build proceeds.

Funding and risks: the reentry authority brings federal match for services the state already funds; Berliner said the current reentry funding stream is roughly $2.7 million per year and that the waiver requires reinvestment of any federal funds received into correctional health or reentry services. She told the committee the reentry waiver has bipartisan uptake in other states and is not currently identified as likely to be cut federally; if the waiver were not renewed the state would lose federal match and would need to cover services from state funds. Committee members flagged IT rollout risks and asked that testing and implementation reports be shared with the committee as the deadline approaches.

Next steps: the state will continue building suspension and claims functionality, finalize the VCCI/DOC workflows, and provide progress reports to the committee as IT testing occurs; the stated launch target is Jan. 1, 2026.