October 26, 2018
Medicaid Coverage for Former Foster Youth Up to Age 26
Children may enter foster care due to incidents of abuse,
Title IV-E program, states must inform foster youth within
neglect, or some other reason that prevents them from
90 days prior to emancipation about their future options for
remaining with their families. During FY2016, some
health care. Title IV-E also directs states to provide these
687,000 children spent at least a day in foster care. Of the
youth with health information and, as of early 2018, official
250,000 children who exited foster care that year, more
documentation that they were previously in care. Such
than 20,500 emancipated at 18 (or an older age, up to 21, if
documentation may be necessary to determine eligibility for
states extend care). In this context, emancipation means
some former foster youth who later apply for Medicaid.
reaching the state legal age of adulthood and not being
reunified with family or placed in a new permanent family.
Medicaid for Emancipating Youth

Young people who age out of foster care can have
The Patient Protection and Affordable Care Act (ACA, as
significant health needs. For example, a 2015 national
amended; P.L. 111-148) required states, as of January 1,
survey of 21-year-olds who had been in foster care as
2014, to provide Medicaid coverage to youth who have
teenagers found that nearly one-fourth had been referred
emancipated until their 26th birthday. The U.S. Department
for substance abuse assessment or counseling. The
of Health and Human Services’ (HHS’) Centers for
Medicaid pathway for former foster youth is intended to
Medicare & Medicaid (CMS), which administers the
provide necessary health supports in the years immediately
Medicaid program, issued a proposed rule in January 2013
after leaving foster care. It parallels another ACA
and a final rule in November 2016 to specify additional
requirement that health insurance companies provide
parameters about youths’ coverage under the program.
coverage of children up to age 26 under their parents’
private health care plans.
The Medicaid and Foster Care Programs
Medicaid, authorized in Title XIX of the Social Security
Medicaid regulation requires states to determine whether
Act (SSA), is a federal-state program that jointly finances
current beneficiaries, including youth emancipating from
medical and related services to a diverse low-income
foster care, are eligible for other Medicaid pathways to
population. To be eligible for Medicaid, individuals must
avoid gaps in coverage. Upon emancipating from foster
meet both categorical (e.g., elderly, children, or pregnant
care, youth may be eligible for mandatory Medicaid
women) and financial (e.g., income, assets) criteria in
pathways available to adults (e.g., pregnancy or disability
addition to requirements regarding residency, immigration
pathways). If determined eligible, they are to be enrolled
status, and U.S. citizenship. For some eligibility groups or
via these other pathways (with the exception of a pathway
pathways, state coverage is mandatory, while for others it is
for non-elderly low-income adults that was established
optional. States and territories (states) must submit a state
under the ACA). However, if these young people do not
plan to the federal government to describe how they will
qualify for other mandatory pathways, or states do not have
carry out their Medicaid programs within the federal
sufficient information to determine such eligibility, they are
statute’s framework. States that wish to make changes
to be enrolled in the mandatory Medicaid pathway for
beyond what the law permits may seek CMS approval to
former foster youth without interruption in coverage.
waive certain statutory requirements to conduct research
To be eligible for the former foster youth pathway,
and demonstration waivers under Section 1115 of the SSA.
individuals must (1) be under age 26, (2) have been “in
The Foster Care, Prevention, and Permanency program,
foster care under the responsibility of the State” upon
authorized in Title IV-E of the SSA, is a federal-state
reaching age 18 (or any age up to 21 if the state extends
program that, among other things, jointly finances foster
federal foster care to that age); and (3) have been enrolled
care for children who a state determines cannot safely
in Medicaid “while in such foster care.” Unlike most
remain in their homes and who meet federal eligibility rules
eligibility pathways, the former foster youth pathway is
related to being removed from a low-income household and
available to eligible youth regardless of income.
other factors. The program also provides some support for
services to assist older children in foster care, and those
Based on the national survey of former foster youth who
who age out, in making a successful transition to adulthood.
were age 21 in FY2015, approximately 70% had Medicaid,
The Administration for Children and Families (ACF) at
15% had some other health insurance, and 15% had neither.
HHS administers the Title IV-E program.
Continuity of Medicaid Coverage
While in foster care, nearly all children are eligible for
In the November 2016 final rule, CMS recommended that
Medicaid under mandatory eligibility pathways. This means
states use automated transition of eligible individuals to the
that states must provide coverage because these children
former foster youth pathway if they are not eligible for
receive assistance under the Title IV-E foster care program,
other mandatory eligibility pathways. However, some
are disabled, or meet other eligibility criteria. Under the
former foster youth, such as those who emancipated before
https://crsreports.congress.gov

---

link to page 2 link to page 2
Medicaid Coverage for Former Foster Youth Up to Age 26
January 1, 2014, may need to apply for coverage under this
guidance to states on best practices for removing barriers
pathway. According to CMS, states may allow these youth
and ensuring timely coverage under this pathway, and on
to attest to their eligibility. States that do not accept self-
conducting related outreach and raising awareness among
attestation must use electronic records that show a youth’s
eligible youth.
foster care history and receipt of Medicaid while in care (if
available). If electronic records are not available or are
Figure 1. Medicaid Coverage for Former Foster Youth
limited, states can require that applicants provide
Who Move to Another State Following Emancipation
documentation showing that they had been in foster care.
Further, if a state cannot verify whether a youth remains a
state resident it may require a former foster youth to self-
attest or document his or her state residency.
Optional Coverage for Certain Youth
The Medicaid regulation requires emancipated youth to
have had coverage at the time they left care at age 18 (or
older, up to age 21). However, the rule gives states the
option of providing coverage to youth who emancipated
from foster care and received Medicaid (1) at some point
while in foster care but not at the time they aged out; or (2)
while in the custody of the state child welfare agency, but
were placed in another state and were enrolled in that
state’s Medicaid program while in foster care or when they

emancipated. According to CMS, this option is made
Source: Based on CRS review of HHS and CMS websites.
available in response to the possible interpretation of the
Medicaid Benefits
law that youth are not necessarily required to have had
Medicaid coverage at the time they emancipated. CMS
In general, the rules for Medicaid benefit coverage for
stated that this could apply to foster youth who reached age
former foster youth under age 21 are the same as for non-
18 while they were on a runaway episode and whose
disabled children. For those over age 21, benefit coverage is
Medicaid coverage had lapsed.
the same as for non-disabled adults. Former foster youth
generally receive services through what is sometimes called
Youth Who Move to Another State
traditional Medicaid—an array of required or optional
As noted, the ACA specified that individuals were eligible
medical assistance items and services listed in statute.
for the former foster youth pathway if they were “in foster
However, states may also furnish Medicaid through
care under the responsibility of the State” upon reaching
alternative benefit plans (ABPs). Under ABPs, states may
age 18 or an older age, up to 21, in states that extend care.
provide a benefit that is defined by a reference to an overall
In its January 2013 proposed rule, CMS interpreted the
coverage benchmark, rather than a list of discrete items and
statute to mean that states were not required to provide
services. Like traditional Medicaid, ABPs must include
coverage to youth who were enrolled in Medicaid and aged
services under Medicaid’s early and periodic screening,
out in another state, but could do so. In separate guidance in
diagnostic and treatment (EPSDT) benefit for youth under
2013, CMS indicated that it would approve state plan
age 21. ABPs can be targeted to certain Medicaid groups,
amendments that offered coverage to out-of-state youth,
including former foster youth. However, states may not
pending publication of a final rule. Figure 1 shows the 14
require such individuals to receive Medicaid via ABPs.
states that received approval following the proposed rule.
Cost Sharing
In its November 2016 final rule, however, CMS reversed its
States may require certain enrollees, including adult former
earlier interpretation. The rule explained that because the
foster youth, to share in the cost of Medicaid services. Cost
statute provided eligibility to former foster youth who had
sharing requirements for program participation fees (e.g.,
emancipated in the state—not a state or any state—it could
premiums) and point-of-service cost sharing (e.g., copays,
not be applied by a state to youth who emancipated in a
coinsurance) may vary by income, and certain services
different state. Accordingly, states could no longer cover
(e.g., emergency services, family planning services and
these youth via state plan authority; however, they were
supplies) are exempt. Maximum allowable amounts may
encouraged to seek CMS approval under the Section 1115
differ for individuals with annual income (1) at or below the
waivers. Based on CRS review of the CMS website as of
federal poverty level (FPL) (i.e., $12,140 for an individual
mid-October 2018, 8 of the 14 states received such waiver
in 2018), (2) from 100%-150% of FPL, and (3) above 150%
approval to provide this coverage. (See Figure 1.)
of FPL. However, in aggregate, all types of cost sharing
must not exceed 5% of household monthly or quarterly
The Substance Use-Disorder Prevention that Promotes
income, as chosen by the state.
Opioid Recovery and Treatment for Patients and
Communities Act (P.L. 115-271), enacted on October 24,
Adrienne L. Fernandes-Alcantara, Specialist in Social
2018, amended the Medicaid statute on the former foster
Policy
youth pathway. It will permit states, as of January 2023, to
Evelyne P. Baumrucker, Specialist in Health Care
use state plan authority for providing coverage to former
Financing
foster youth who move across state lines. The law directs
HHS, within one year of the law’s enactment, to issue
IF11010
https://crsreports.congress.gov

---

Medicaid Coverage for Former Foster Youth Up to Age 26


Disclaimer
This document was prepared by the Congressional Research Service (CRS). CRS serves as nonpartisan shared staff to
congressional committees and Members of Congress. It operates solely at the behest of and under the direction of Congress.
Information in a CRS Report should not be relied upon for purposes other than public understanding of information that has
been provided by CRS to Members of Congress in connection with CRS’s institutional role. CRS Reports, as a work of the
United States Government, are not subject to copyright protection in the United States. Any CRS Report may be
reproduced and distributed in its entirety without permission from CRS. However, as a CRS Report may include
copyrighted images or material from a third party, you may need to obtain the permission of the copyright holder if you
wish to copy or otherwise use copyrighted material.

https://crsreports.congress.gov | IF11010 · VERSION 2 · NEW

---