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White House Press Secretary Karoline Leavitt said on social media that the Trump administration is aware of the issue and that no payments had been affected.
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The move is aimed at reducing drug overdoses and treating substance abuse.
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Defendants ordered to receive state psychiatric treatment wait for weeks or months in jails for beds to open up.
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Clifton T. Perkins Hospital had reported issues for more than a decade.
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A recent investigation unveiled new instances of abuse at the max-security hospital.
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The hospital has a history of leadership issues and other problems.
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The federal governmental stopped automatic re-enrollment about a year ago.
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About a third of students report feeling sad or hopeless.
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Nursing home residents say they facilities are not being inspected.