Oregon no longer plans to provide Medicaid services to those about to
leave jail or prison
[October 11, 2025]
By DANIELLE DAWSON/InvestigateWest
Oregon Health Authority this week notified state prisons and other
officials that it no longer intends to implement a novel Medicaid
initiative that would have provided targeted health services to those
about to exit jail or prison.
The move comes several months after health officials quietly placed the
program’s launch on hold, anticipating the passage of sweeping changes
to shrink federal Medicaid spending as part of the Republican-led tax
cuts package, House Resolution 1, also known as the “One Big Beautiful
Bill.”
Referred to as “ reentry benefits,” the $64 million Medicaid expansion
program had been in the works for more than two years as a way to bridge
a critical gap in care that leaves most incarcerated people uninsured
upon release, putting them at a higher risk of serious health
complications or overdoses.
In a memo Monday, Oregon health officials pinned the decision on the
extensive technical and administrative work required to meet the Big
Beautiful Bill’s new Medicaid eligibility requirements, and the looming
expiration of Oregon’s federal authorization for the program.
Oregon Health Authority spokesperson Kristen Lambert said in an email
that the federal spending bill leaves the state “little flexibility or
time” to update its online system for managing Medicaid eligibility in
order to implement the reentry health care program.
The memo also mentioned the Trump administration’s plans to rein in the
use of a funding tool that allows states to use Medicaid dollars for
programs that are typically not eligible, arguing it has been used too
liberally by states. Oregon planned to use the tool to finance the
reentry benefits.
State Rep. Pam Marsh, D-Ashland, who has advocated to increase resources
for prison health care, says she understands the Oregon Health
Authority’s decision to nix the initiative before it can get off the
ground, seeing as how health officials have “tremendous challenges”
ahead to rework the state’s Medicaid program to continue operating with
less funding and new work requirements, as mandated by the Big Beautiful
Bill.
“Having said that,” Marsh continued, “it’s a tremendous loss because it
would have been a huge breakthrough.”
Oregon Medicaid Director Emma Sandoe said the Health Authority is “proud
of the work on this program to date” in a statement to InvestigateWest.
“OHA remains committed to collaborating with partners toward increasing
health care access and improving outcomes for incarcerated and formerly
incarcerated (Oregon Health Plan)/Medicaid members,” she said.
Sandoe noted that the move does not impact other soon-to-be-launched
programs for low-income Oregonians through the Oregon Health Plan, such
as a forthcoming nutrition stipend and expansion of health services for
young adults and juveniles exiting detention or foster care settings.
Oregon had originally planned to launch the reentry benefits program for
incarcerated adults in early 2026, the date approved by the Centers for
Medicare and Medicaid Services under the Biden administration. However,
as InvestigateWest reported in July, the approval was part of a waiver
that is only good through 2027, meaning it would have been up to the
Trump administration to decide whether to renew it.
While it has not made any public statements on reentry benefits, the
Trump administration informed states in April that it will not extend or
approve new funding requests for health programs known as “designated
state health programs.” These are state-led initiatives that are not
normally eligible for Medicaid funding, but can receive these funds
under a waiver.
The Trump administration said prior requests have employed “creative
interpretations” of waivers to shift what should be supported by states
to the federal government. It instead wants to reprioritize federal
dollars on programs related to Medicaid’s traditional scope of care.
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 “Mounting expenditures, such as
covering housekeeping for individuals who are not eligible for
Medicaid or high-speed internet for rural healthcare providers,
distracts from the core mission of Medicaid, and in some instances,
serves as an overly-creative financing mechanism to skirt state
budget responsibilities,” Centers for Medicare and Medicaid Services
said in an April 10 release on the move. The agency did not
immediately respond to a request for comment. An automatic email
reply stated that responses would be delayed due to the ongoing
federal government shutdown.
When the reentry program was approved, Oregon was granted the
ability to use designated state health program dollars to cover its
portion of the program’s financing. The state also needed an
exemption from a longstanding federal policy that largely prevents
people living in certain facilities, like prisons, from accessing
Medicaid benefits.
The experimental initiative would have provided those nearing the
end of their time of incarceration basic health services using
Medicaid up to three months before their release. Those services
could have included consultations with outside providers, access to
behavioral health and addiction counseling, and a short-term supply
of prescription medications.
The goal was to help link income-eligible people with Medicaid
before they are released from jail or prison and move back into the
community. Under federal rules, inmates lose their Oregon Health
Plan benefits while confined, meaning that many leave incarceration
unsure of where or how they can access any care they may need.
State officials were particularly focused on the impact this lapse
in care has on those struggling with substance use disorders:
Formerly incarcerated Oregonians are much more likely to experience
an opioid overdose than those in the general public — a risk that is
especially acute in the first weeks after release, as one 2023 study
noted.
Advocates and those who work with people in the justice system
viewed the benefits as an opportunity to upend the status quo, where
success in transitioning out of incarceration largely depends on how
people have been set up by their parole officer or by jail staff.
“We know what happens when people leave prison without health care.
We see more overdoses, untreated illness and even preventable
death,” said Angela Kim, a former critical care nurse who was
previously incarcerated at Coffee Creek Correctional Facility in
Wilsonville, Oregon. Kim now works with the Oregon Justice Resource
Center’s health advocacy team.
“This decision risks making addiction recovery harder and our
communities less stable if people come out underprepared for the
health challenges of reentry,” she continued.
Marsh, the Democratic lawmaker, says she’s also now concerned about
what the reentry benefits program’s failure to get off the ground
could mean for other pilot initiatives to address Oregon’s opioid
crisis from behind bars. Medicaid was viewed as the best option to
fund these programs in the long term.
One such program Marsh sponsored unlocked $10 million to support
Oregon’s jails in assessing people for opioid addiction during their
intake and providing medication treatment in the facility.
“Our jails struggle to provide basic care for people, and many times
that’s why we’re falling well short of what we all agree would be
reasonable health care standards,” Marsh told InvestigateWest.
“That’s the bottom line, that’s why we need the (Oregon Health Plan)
there.”
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