How Can Schools Leverage Medicaid to Meet Needs of Most Vulnerable Students?

When the federal government lifted its restrictions in 2014 on the services that schools could charge to Medicaid, education and health leaders saw an opportunity to provide better care for the most vulnerable students.

Rather than opening the floodgates to new reimbursements, though, the lifting of the “free care rule” has left many states engaged in the slow process of amending their Medicaid state plans and implementing new rules. A recent webinar—hosted by the Health Schools Campaign, the National Health Law Program (NHELP) and Community Catalyst—explored the steps that states are taking to ensure schools can make the best use of Medicaid.

Originally, the free care rule forbade schools from charging Medicaid for services that were free to all students, even if Medicaid would cover those services. Only those provided for special education students were eligible for reimbursement. A December 2014 letter from the U.S. Department of Health and Human Services made clear that states can charge for services delivered to students receiving Medicaid as long as they are covered by the state plan and delivered by a qualified provider and as long as schools have a billing mechanism.

Many states had codified the previous language limiting the use of school reimbursement in their state plans—in fact, a 2016 analysis by NHELP found that at least 31 states had some language in their plan that made it hard to expand coverage.

Some states have responded by seeking state plan amendments (SPAs) from the Centers for Medicaid and Medicaid Services. Louisiana and Massachusetts have received approval, while California and Georgia have amendments pending.

Louisiana has moved forward with implementation, expanding on a 2011 change that authorized school nurses to deliver Medicaid services to students with Individualized Education Plans (IEPs).

Massachusetts is developing guidance for how local school districts should seek reimbursement and track the time spent on providing services. Schools will be able to seek reimbursement for a set of services expanded to include, nutritional, respiratory, optometry, physician and some dental.

The webinar speakers provided key questions that states looking to expand school-based Medicaid reimbursement should ask. They include:

  • Does your state’s Medicaid state plan specify what services can be provided in schools?
  • Does it limit Medicaid school-based services to special education students?
  • Will your state need a SPA to expand reimbursement?
  • Is your state already developing a SPA? If so, what is the public input process?
  • What models are used for providing Medicaid services in schools? What are the range of services?
  • How does the state/district organize billing and reimbursement?
  • What are the financial impacts of expanding access to Medicaid school services?
  • What data exists on an assessment of unmet student need?
  • What challenges exist to collecting data and to sharing data between agencies?