Selective Access in Child List formatted item

I am able to filter a list formatted item when selective access is enabled. However, it is not possible to do so when the line item is formatted as a list that does not has selective access enabled, even if it is a "child" of a selective access list.

I need to be able to filter lower hierarchy levels based on inherited selective access from parent lists. This way users will not see all the items on a drop down field.