Medicaid reimbursement

The Centers for Medicare and Medicaid (CMS) of the Department of Health and Human Services (HHS) has issued a proposed rule that would eliminate federal Medicaid payments for administrative activities performed by school districts and transportation from home to school and back for school-aged children with individualized education programs (IEPs) established pursuant to the Individuals with Disabilities Education Act. The Medicaid program provides medical assistance to persons with disabilities, among others, through grants to states. The Medicaid statute provides for payment for amounts "as found necessary by the Secretary for the proper and efficient administration of the State plan." CMS is now interpreting this statute to exclude transportation from home to schools and certain school-based administrative activities including Medicaid outreach, facilitating Medicaid eligibility determinations, referral, coordination, and monitoring of Medicaid services. The new proposed rules supersede prior federal guidance and are based on HHS’s new determinations that "that such activities can only be properly conducted, overseen and appropriately allocated to Medicaid when conducted by employees of the State or local Medicaid agency" and "that transportation from home to school and back does not meet the definition of an optional medical transportation service nor is it necessary for the proper and efficient administration of the State plan." Background and additional details on the repeated federal efforts to cut support for these services is available starting at the second link below. Resources from NSBA’s Office of Advocacy on this issue are collected at the third link. Comments to the proposed rule must be received by November 6, 2007.

72 Fed. Reg. 51,397 (Sept. 7, 2007)
Proposed regulation
NSBA School Law pages on cuts to Medicaid reimbursement
NSBA's Advocacy pages on Medicaid reimbursement