As schools across the country reckon with the ending of the American Rescue Plan (ARP) funds, many, if not all are trying to find ways to sustain the services these funds supported. For most schools, that means finding some sustainable method of funding mental and behavioral health services. Fortunately, an expanding and increasingly well-known pathway through school-based Medicaid exists.
Outside of the Individuals with Disabilities Education Act (IDEA), school-based Medicaid is the single largest source of sustainable funding for health services in schools.
While most schools are aware of – and often use – school-based Medicaid to help fund Individualized Education Plan (IEP) services like speech therapy – it can do so much more. If state policy allows, school-based Medicaid can partially fund virtually all health services – including mental and behavioral health – a school provides.
In the last several years, there has been a massive amount of momentum to help states update their school-based Medicaid policies to ensure schools can claim the maximum amount of reimbursement.
The Bipartisan Safer Communities Act directed The Center for Medicaid and Medicare Service (CMS) to update their guide on school-based Medicaid services, created a technical assistance center to support states in their expansion of school-based Medicaid and provided $50 million in grants to states to help them expand services.
CMS has made it clear they want states to look at all the opportunities to fully expand their school-based Medicaid programs to help schools pay for these vital services.
What Can School-Based Medicaid Fund
If a state policy allows the services reimbursable by Medicaid are vast and include:
- Occupational therapy evaluations and services (including individual and group settings)
- Physical therapy evaluations and services (including individual and group settings)
- Speech therapy evaluations and services (including individual and group settings)
- Audiology therapy and evaluations (including individual and group settings)
- Nursing evaluations and services
- Behavioral health evaluations and services (including individual and group settings)
- ABA evaluations and services
- Health aide/personal care aide services
- Hearing and vision screenings
- Respiratory therapy
- Specialized transportation
- Supporting families with enrolling in Medicaid
State Policy
CMS is the Federal agency that sets the broad rules for Medicaid policy. Based on those rules, each state gets to make its own unique Medicaid plan. How much a school can claim in Medicaid reimbursement will depend on how their state has set up their school-based Medicaid policy. While states are often similar, no two states are the same.
Curious about your state? The Healthy Schools Campaign maintains a map that shows what services are reimbursable by state and houses a database that allows schools to easily find all the information on their state program.
There are many facets to school-based Medicaid policy – however – there are two that have the most impact on what schools can claim reimbursement for.
What plans of care are eligible? Plan of care refers to the document that states the services the students need. All states allow reimbursement for services listed in an IEP; however, some states also allow reimbursement for services listed on a 504, BIP, IHP or any type of written plan.
CMS allows states to permit schools to claim reimbursement for services on any plan of care. If a state limits what services can be reimbursed, it is only due to the choice of the state Medicaid agency – and can be changed by submitting a State Plan Amendment (SPA) to CMS.
This question has the most impact on what schools in each state can claim.
Question to ask: What plans does your state allow (if you aren’t sure, you can use the map to find out)? If it is limited to the IEP, your state Medicaid policy is causing your schools to miss out on opportunities to receive Medicaid reimbursement.
What providers are eligible to provide reimbursable services? In almost all cases, reimbursable health services provided in schools must be provided by health care practitioners with licenses overseen by either state licensure boards or the State Education Agency (SEA). Each state is allowed to specify the exact list of licenses that are eligible for reimbursement in the school setting. The more eligible providers a state has, the more reimbursement schools can claim.
Question to ask: What providers does your state allow (if you aren’t sure, you can use the map to find out)? If you have licensed health care providers providing services in your schools that aren’t currently listed as reimbursable, your state Medicaid agency could choose to submit a SPA to expand the list of eligible providers.
Ultimately, the decision to make any changes lives with the state Medicaid agency. However, schools and their stakeholders can advocate for the policy changes they feel would benefit schools’ ability to claim additional reimbursement.
While some states are hesitant to add reimbursable services to their Medicaid plan because of the cost doing so typically adds to state general funds – the school-based Medicaid program is different. Due to its unique structure, unlike most other parts of Medicaid – in most states – an expansion of the school-based Medicaid program does not cost the state additional funds. This is because most states use existing education funds already being spent on health services as the state match and simply allow schools to pull down the matching federal funds.
What Should Schools Be Doing?
Learn. Many schools rely on billing vendors to help manage their school-based Medicaid programs for them. While these vendors can be a tremendous asset – each school still needs to understand their states program to make sure they are maximizing their reimbursement.
Evaluate. Once a school understands they are sure they understand everything their state allows them to claim reimbursement for, they should look at the services they provide and make sure they are claiming reimbursement for all they are eligible for. Schools must also make sure they are paying for these services with state dollars – and not federal funds (like IDEA). Only services paid for with state dollars are Medicaid claimable.
Advocate. If a state policy does not allow all plans of care or all providers that schools in that state use, they (and their stakeholders) can advocate for changes in their state Medicaid policy. Both the Healthy Schools Campaign and NAME can be great tools for advocacy.
School-based Medicaid can be complex – and some schools may be concerned about learning the process. However, once a school has built out their process for billing Medicaid, it becomes a funding source they can count on year over year to fund school health services. Schools shouldn’t be frightened by the complexity – but rather energized by the possibility.
