Federal Dateline

Rallying for Medicaid Reimbursement

by Mary Kusler

Every day, school districts across America help students in poverty access necessary health care services. This has helped to establish schools as legitimate sites for health care delivery.

Over the years, schools also have been given the right to submit claims to Medicaid for legitimate health-related services for Medicaid-eligible students. Unfortunately, the Bush administration is trying to take away that option from school districts and shift the costs back onto local taxpayers.

Under the Bowen decision in 1987, school districts have been able to submit claims for Medicaid-eligible services to students with disabilities under the Individuals with Disabilities Education Act. Schools may seek payments in three areas:

• Fee-for-service claiming allows for reimbursement for direct medical service when the school district maintains the occupational therapist or hearing therapist on the school staff.

• Administrative claiming enables school districts to seek reimbursement for the arranging of medical services, including consultations, evaluations and referrals.

• Transportation of eligible students under IDEA to and from medical services not located on school grounds can be reimbursed.

Changes Pending
In February, President Bush released his FY 2007 (2007-08 school year) budget proposal. Buried within the proposals for the Department of Health and Human Services were three sentences stating the intention of the Centers for Medicare and Medicaid Services to eliminate school-based administrative and transportation claiming.

As a result of our own investigation, AASA learned that CMS intends to make this change through regulations rather than through the legislative process. This would allow changes to take effect immediately, leading to a mid-year shift of costs onto local school districts. Health care providers who perform the same services as school districts are still allowed reimbursement for these services from Medicaid.

The value of the administrative claiming cost shift would exceed $1 billion nationwide, by some estimates. Even more alarming, school districts would have to immediately absorb these costs. Because these are services provided under IDEA, a school district is required to continue the services listed in a student’s individualized education plan.

Additionally, this cost shift would exacerbate the federal shortfall in funding IDEA. School districts and states already are covering a $13 billion federal shortfall for educating students with disabilities. The elimination of Medicaid claims would only add to that growing burden on local communities.

The present threat to school-based Medicaid claiming is not the first time that school administrators have been at odds with the Centers for Medicare and Medicaid Services. Over the years, CMS, formerly known as the Health Care Financing Agency, has made it increasingly difficult for states and school districts to obtain reimbursement. Federal officials have failed to implement their practices equally across states, resulting in rejection of some states’ plans, and ignored the advice of school leaders in producing the 2002 Administrative Claiming Guide. This led to reduced benefits to school districts and the introduction of arbitrary new rules.

Rallying Support
AASA was quick to act after the release of the president’s budget proposal. We immediately met with the staff of Rep. George Miller, D-Calif., ranking member of the Education and Workforce Committee, to talk about potential implications of the Medicaid cut. In addition, we worked with a long-time advocate for school-based Medicaid claiming, Connie Garner, a staff member on the Health, Education, Labor and Pensions Committee, working for Sen. Edward Kennedy, D-Mass. She realized we needed to introduce legislation quickly and that the legislation had to clarify and legitimize the right of school districts to submit claims to Medicaid for administration and transportation expenses.

In late July, both the House and the Senate introduced the Protecting Children’s Health in Schools Act of 2006 (HR 5834 and S 3705, respectively). Once again AASA membership played a strong role. Thanks to the leadership of AASA member George Wilson, superintendent in Monroe County, Ky., our association was able to secure a Republican co-sponsor for introduction, Rep. Ed Whitfield of Kentucky.

Through the dedicated efforts of Garner, Jeff Mortier of Whitfield’s staff, Amy Hall, a staff member of Rep. John Dingell, D-Mich., and Denise Forte of the House Education and the Workforce Committee, the bills were introduced during the same week, allowing for a strong show of congressional support for the role schools play in health care delivery. In addition, the bills extended the ability of school districts to claim Medicaid costs for Section 504 students.

Be Prepared
We still have a long road ahead. Please urge your members of Congress to co-sponsor HR 5834 and S 3705. We need as many co-sponsors as possible to show the strong congressional support for school-based Medicaid claiming.

School districts should be ready to share the impact of the proposed elimination on their school district budgets. In addition, be prepared for CMS to act at any moment by issuing new regulations. Keep up the pressure and be vocal on this issue to prevent the elimination of reimbursements for services to the poorest students school districts serve.

Mary Kusler is the assistant director of government relations at AASA. E-mail: mkusler@aasa.org