How Michigan Is Expanding Access to Mental Health Services

May 28, 2020

School districts often struggle to meet the need for mental health services in schools and are likely to see increased demand as students head back to school and process the COVID-19 pandemic.

Increasing access to school health services, including mental health services, presents an important opportunity to reach vulnerable and underserved children and support children’s health and achievement. Regular access to health services in schools makes kids healthier, improves attendance and is associated with better academic outcomes, particularly for the most vulnerable students.

The state of Michigan addressed a growing need for mental health services in schools by leveraging a 2014 federal policy change that allows school districts to bill Medicaid for more services—many of which schools are already providing. Ultimately, it means more funding for health services in schools.

In Michigan, Medicaid is an important source of health insurance for children. As of October 2019, three in eight children in Michigan were covered by Medicaid. Prior to expanding its school-based Medicaid program, school districts could only bill Medicaid for services included in Medicaid-enrolled students’ Individualized Education Programs (IEPs). For example, let’s say Maria is enrolled in Medicaid and had an IEP, but mental health services, such as counseling and medication management, were not in that plan. Even if Maria received these services in school, the school district could not get reimbursed because the services were not included in her IEP.

All that changed in 2019 when Michigan became one of 12 states to successfully expand their school-based Medicaid program.

Stakeholders in Michigan had been interested in expanding their school-based Medicaid program since the 2014 federal policy change. The change created an opportunity for a range of stakeholders to convene and work together to develop a plan to leverage this federal opportunity.

Around the same time this work was taking place, Michigan Legislature passed a bill that included $31 million to provide licensed behavioral health providers in schools for general education students. That bill also required the state to expand its school Medicaid program beyond services included in students’ IEPs. The $31 million served as a way for schools to get those health services up and running and cover costs associated with training, planning and materials development.

Michigan submitted their request to Centers for Medicare and Medicaid Services (CMS) to expand their school Medicaid program in December 2018 and received approval in August 2019. In addition, to allowing school districts to seek Medicaid reimbursement for non-IEP services, the program change expanded the types of providers able to bill Medicaid to include physician assistants, certified nurse specialists, marriage and family therapists, behavior analysts, school social workers and school psychologists. The addition of these providers will play a critical role in supporting expanded access to school mental health services.

The expanded school Medicaid program allows for more services to be reimbursed by Medicaid and provides a sustainable source of funding for school health services. Prior to the change, Michigan received just over $250 million in federal Medicaid reimbursements. Michigan estimates a $14 million increase from billing for services delivered by school psychologists alone. The additional revenue generated from the expanded program as a whole is expected to be significant and play a critical role in ensuring access to student physical and mental health services.

While 12 states have already taken advantage of this federal policy change, many more states are in the process. We have seen momentum pick up recently as our nation realizes the important role schools play in providing health services to students. A significant number of states have expressed interest in expanding their programs to increase access to mental health services to address unmet mental health needs.