Concerns over negative impacts to students’ out-of-school public insurance benefits appear to be delaying the release of a U.S. Department of Education final rule intended to ease the process of obtaining parental consent for Medicaid school-based health services.
The final rule was expected to be released in January. In an email to K-12 Dive Thursday, an Education Department spokesperson said there is no update to the status of the final rule.
The Education Department is partnering with the U.S. Department of Health and Human Services' Centers for Medicare and Medicaid Services to address some of the concerns raised in public comments on the proposed rule, the spokesperson said.
Several commenters opposed to the proposed rule urged the Education Department not to make changes. They raised concerns that children could lose access to public healthcare services outside of school if the Medicaid agency or a managed healthcare group determined they already got those services in school.
Parental consent forms allowing for school-based Medicaid billing explicitly state that these permissions will not impact lifetime coverage or any other insured benefits.
But an August 2023 letter from 26 organizations, including National Disability Rights Network and National Down Syndrome Congress, said, "Parents are routinely informed, sometimes even after services in other settings have already been rendered, that the Medicaid agency has deemed them duplicative with school-based services and their coverage is denied."
In supporting the proposed rule, several education administration groups — the Council of Administrators of Special Education, or CASE, and AASA, The School Superintendents Association, and others — called the current parental consent process confusing. Parents are asked to provide consent both when enrolling a child or themselves in Medicaid and before schools file first-time invoices for Medicaid-eligible school-based specialized services.
Additionally, the organizations said the process puts extra paperwork burdens on district staff, resulting in incomplete forms and potential loss of reimbursements to districts. Reimbursements for school-based Medicaid services are the third or fourth largest revenue source for schools.
If children's access to out-of-school public healthcare benefits are hurt because of billing for school-based services, education administration organizations want to know why and how that can be remedied.
"We definitely don't want parents being served a bill when they are Medicaid-eligible and should be getting that service through their insurance and not paying out of pocket," said Phyllis Wolfram, executive director of CASE. "We definitely don't want that happening. If it's happening, then we do have to figure out how to make it not happen."
Understanding the scope of concerns
The proposed rule calls for a rare amendment to regulations for the Individuals with Disabilities Education Act, which requires schools to provide supports to students with disabilities for learning and related services. No other parental consent procedure under IDEA would be affected.
About 9,700 comments were submitted on the proposed rule between May 18 and Aug. 1, 2023.
The rule seeks to eliminate a provision that requires one-time parental consent before schools file their first invoices for school-based specialized services provided to children with disabilities who are eligible for public benefits. Those public benefits include Medicaid, the Children’s Health Insurance Program, or other public insurance.
The current process, the proposed rule said, "slows down or may prevent public agencies from accessing available funding for needed IDEA services without providing any additional protection to families."
Even without the one-time parent consent requirement as recommended under the proposed rule, schools would still need to provide written notification to parents before accessing a child's or parent's public benefits or insurance for the first time, and annually thereafter.
Wolfram and Jenny Millward, executive director of the National Alliance for Medicaid in Education, said that before the proposed rule's public comment period, they had not heard of concerns about school-based Medicaid billing negatively affecting children's healthcare services outside of school.
CASE is surveying its members about the practice and plans to share that data with the Education Department, Wolfram said. NAME is also sharing the survey with its members involved in school-based Medicaid billing.
The information collected through the survey should give CASE, NAME and others "a refreshed look" at the practice, Millward said.
She said she hopes the survey will show no examples of conflict in access to out-of-school services for students so the Education Department "can have confidence" in issuing a final rule. "And if it is happening, let us know so that we can find a solution, because it shouldn't be happening," Millward said.
Supports to school districts
In addition to proposing the change in the parental consent process, the Education Department has worked with HHS over the last few years to provide supports for school-based Medicaid billing programs.
Most significantly, in May 2023, the agencies released a 183-page guide for school-based Medicaid services and billing. The guide, the first comprehensive update in about 20 years, explains flexibilities states can use to promote access to health-related, school-based services for all Medicaid-eligible students in compliance with federal laws and regulations.
It also gives examples of ways schools — including those in rural and under-resourced areas — can simplify billing procedures for school-based services.
Additionally, HHS’ Centers for Medicare and Medicaid Services announced plans in January to award 20 state grants of up to $2.5 million each over three years to improve school-based services under Medicaid and the Children’s Health Insurance Program. The grant program will allow schools to provide more services to children, especially those in rural and other underserved areas, the announcement said.
And earlier this month, the Education Department released a 2-page guide giving step-by-step recommendations for using Medicaid funding for student health services, as well as three examples of states' school-based Medicaid funding practices.
Education organizations said these resources are particularly helpful now as Medicaid and CHIP benefits no longer have pandemic-era automatic renewals for enrollees. That transition, known as "unwinding," has led to 4.8 fewer children being enrolled in Medicaid from April 1, 2023, to March, according to Georgetown University's McCourt School of Public Policy’s Center for Children and Families.
