SB1720 amends title XIX of the Social Security Act to remove the statutory Medicaid coverage exclusion for individuals who are in custody pending disposition of criminal charges. Instead of an automatic termination of Medicaid eligibility, the bill preserves eligibility (with an explicit option for states to suspend coverage) and sets an effective date tied to the first calendar quarter beginning 60 days after enactment.
A conforming change to section 1902(a)(84) clarifies the suspension-versus-termination approach and takes effect January 2, 2026.
To help states operationalize the change, the bill authorizes $50 million in HHS planning grants. Grants require an assessment of the eligible population and provider capacity, concrete milestones and measurable targets to expand Medicaid-enrolled providers (including behavioral health and substance-use services), technical assistance for EHR and billing integration, and stakeholder consultation.
The combination of coverage change plus implementation funding aims to create continuous Medicaid-funded care for people held pretrial—but it also creates immediate administrative, fiscal, and operational work for state and local systems.
At a Glance
What It Does
The bill removes the statutory language that excludes from Medicaid 'an individual in custody pending disposition of charges' and amends state plan termination rules to allow suspension instead of termination. It requires HHS to award planning grants to states to prepare provider networks, EHR/billing systems, training, and quality reporting for this newly covered population.
Who It Affects
State Medicaid agencies and Medicaid managed care plans, county jails and detention facilities, correctional health vendors, physical and behavioral health providers (including SUD services), and Medicaid beneficiaries who are arrested but not yet convicted.
Why It Matters
This is a structural change to who pays for health care while someone is detained pretrial—shifting certain costs and clinical responsibilities from jails (often county-funded) to Medicaid and creating a new enrollment/administration problem for states. It also extends Medicaid-funded continuity of care to a population that previously lost eligibility, with implications for public health, reentry, and provider networks.
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What This Bill Actually Does
SB1720 deletes the phrase in title XIX that excludes people who are held in custody while awaiting the disposition of charges from receiving Medicaid-funded items and services. Practically, that means a person arrested and held pretrial will remain eligible for Medicaid benefits rather than being categorically excluded; states retain the ability, subject to the amended statutory text, to suspend rather than terminate coverage during periods of custody.
The bill attaches two different effective-date rules: the main eligibility change takes effect on the first day of the first calendar quarter beginning 60 days after enactment, and the conforming amendment to the State plan provisions is fixed to become effective January 2, 2026.
Recognizing that eligibility alone will not create access, the bill authorizes the HHS Secretary to award planning grants to states to develop implementable plans. Grant applications must include an initial assessment—an estimate of how many Medicaid enrollees will be in custody pending charges and an inventory of existing provider capacity in jails and communities—and a plan to recruit or contract with sufficient Medicaid-enrolled providers to deliver both physical and behavioral health services, including short-term detox, outpatient SUD care, and evidence-based peer recovery supports.
Plans must set milestones and measurable targets and describe stakeholder consultations with corrections, law enforcement, managed care plans, provider organizations, and beneficiary advocates.The statute also focuses on the practical mechanics of integrating clinical care and billing: states must describe steps to secure electronic health record systems and billing processes that permit jails, contracted vendors, telehealth providers, and outpatient clinicians to bill Medicaid in compliance with program rules. Grants may fund training and technical assistance, quality assurance activities including outcome reporting and learning collaboratives, and development of state infrastructure to sustain provider participation.
The Secretary must distribute grants to ensure geographic diversity among awardees, and the bill authorizes $50 million to run the planning program.
The Five Things You Need to Know
The bill strikes the statutory Medicaid exclusion for individuals 'while in custody pending disposition of charges,' making them potentially eligible for Medicaid-funded services.
The primary amendment takes effect on the first day of the first calendar quarter beginning 60 days after enactment; a conforming change to 1902(a)(84) is set to be effective January 2, 2026.
States may suspend—but not be required to terminate—Medicaid eligibility for individuals who are inmates of public institutions or held pending charges, per the conforming amendment.
HHS must award planning grants to states to prepare implementation; applications must include population estimates, provider capacity reviews, recruitment plans, milestones, and measurable targets.
The bill authorizes $50,000,000 in appropriations for the planning grant program and instructs the Secretary to ensure geographic diversity among grant recipients.
Section-by-Section Breakdown
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Short title — 'Due Process Continuity of Care Act'
This section provides the Act's short name. It signals the bill's framing—linking due process concerns with continuity of medical care—but has no substantive legal effect beyond naming.
Removal of the Medicaid inmate exclusion from title XIX
This is the operative change: the bill amends section 1905(a) of the Social Security Act by removing language that excluded individuals in custody pending disposition of charges from Medicaid coverage. The practical implication is that Medicaid eligibility will not be automatically barred by pretrial custody. The text sets an effective date tied to the first calendar quarter beginning 60 days after enactment and applies to items and services furnished on or after that date.
Conforming amendment on suspension versus termination of eligibility
The bill revises subparagraph (A) of section 1902(a)(84) to clarify that states shall not terminate eligibility solely because an individual is an inmate, but may suspend coverage during periods of incarceration; it also explicitly references the newly restored option for individuals in custody pending disposition of charges. This preserves a state's ability to suspend benefits (often done for administrative reasons) while preventing categorical termination that would require re-enrollment at release.
State planning grants—application requirements and core activities
These subsections require HHS to award planning grants to states and lay out what applications must contain: a process for assessments, a review of policies that could hamper provider participation, and a plan to ensure sustainable Medicaid provider networks. The statute defines specific activities grant funds should support—population assessments, provider recruitment and training, EHR and billing systems for jail and community providers, and quality assurance measures such as outcome reporting and learning collaboratives.
Geographic diversity, funding, and definitions
The Secretary must select a geographically diverse set of states for grants; Congress authorized $50 million to run the program. The bill also includes statutory definitions for 'Medicaid program', 'Secretary', and 'State' to align grant administration with existing title XIX terminology, ensuring the grants apply to state plans, waivers, and section 1115 demonstrations as appropriate.
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Explore Healthcare in Codify Search →Who Benefits and Who Bears the Cost
Every bill creates winners and losers. Here's who stands to gain and who bears the cost.
Who Benefits
- People detained pretrial: They retain or can quickly resume Medicaid coverage while in custody, improving access to physical, behavioral health, and substance-use treatments that were often interrupted under the exclusion.
- Community health providers and SUD treatment programs: Expands a payer source for services delivered to people who cycle through jails, enabling reimbursement for services that were previously uncompensated when delivered during pretrial detention or immediately after release.
- Public health systems and communities: Continuity of care for communicable and chronic conditions can reduce community-level disease transmission and emergency department use upon release, translating to broader health system benefits.
Who Bears the Cost
- State Medicaid agencies: Must absorb implementation work—credentialing, provider network expansion, billing rules, and potential increases in claims volume—requiring administrative resources and potential budgetary pressure.
- Counties and jails: Operational changes are necessary (EHR integration, new billing workflows, contracting with Medicaid providers) even if long-term clinical costs shift to Medicaid; some short-term costs and process redesign will land on local correctional budgets.
- Medicaid managed care plans and providers: Plans must incorporate a new cohort into their risk pools and networks; providers will face credentialing, contracting, and compliance tasks to bill for care provided in custodial settings.
Key Issues
The Core Tension
The bill pits the policy goal of preserving continuity of medical care and due-process protections for people detained pretrial against the practical and fiscal burdens imposed on state Medicaid programs and local correctional systems: expanding eligibility improves health and reduces interruptions in care but shifts costs, administrative complexity, and the logistics of care delivery to systems that must rapidly scale provider capacity and billing infrastructure.
The bill resolves a legal bar to Medicaid-covered care for people detained pretrial but leaves many operational and fiscal questions for implementation. First, states must decide how to operationalize suspension versus termination of benefits: suspension preserves a path to seamless billing, but states will need enrollment, identity verification, and retroactive coverage rules to prevent gaps.
Accurate, timely eligibility determinations at arrest or booking are nontrivial—missteps could produce improper payments or gaps in needed care. Second, provider capacity is uneven; rural areas and some correctional systems lack enough Medicaid-enrolled behavioral-health and SUD providers, meaning coverage alone will not guarantee access.
The planning grants are targeted at these problems, but $50 million spread across 50 states and territories constrains the depth of operational assistance available.
A second set of implementation challenges centers on billing and compliance. Jails and correctional health vendors will need EHR systems and billing processes compliant with Medicaid rules, plus new arrangements with managed care organizations.
Questions about who bills for services delivered inside a facility versus by contracted telehealth or community providers, how to document medical necessity in custodial settings, and how to handle co-payments or third-party liability will require CMS guidance. Finally, the fiscal trade-offs are diffuse: counties may see relief from direct clinical costs, while state Medicaid programs could see higher expenditures.
Whether states pursue supplemental federal funding, adjust eligibility policies elsewhere, or seek waiver authority will shape the net fiscal outcome but is not addressed in the bill.
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