What's ahead for school districts in terms of their ability to continue to access Medicaid?

Schools may lose $635 million for the 2008-2009 school year. In addition, proposed rule changes will in many cases stop payments for services rendered in schools that Medicaid long has covered. At risk are monies collected by schools for specialized transportation to and from school, as well as the elimination of Medicaid recovery for service coordination and case management. Districts will face more restrictions for payment for services such as speech, occupational, physical therapy and in some cases, nursing services for particularly fragile children. Also, they will continue to be paid at rates far below the cost of services due to the manner by which rates are set.

The reductions stem from Medicaid funding cuts in general, but also from a tightening of conditions under which schools can recover costs for direct and administrative services. Over the course of the past 10 years, federal and state enforcement agencies have brought actions against various states for inappropriate and duplicate payments that impact school districts. Moreover, the institutional risks of noncompliance have grown from relatively non-adversarial audits and occasional return of payments to formal investigations resulting in sanctions and sizable returns of monies.

Read the full series of Medicaid articles…, including ways that school districts can overcome some of the regulatory challenges.

Source: District Administration Custom Publishing Group, 6.08