Support Increased Funding for School Health Services

February 03, 2014

The free care rule impacts funding for student health.

With the passage of the Affordable Care Act, we have an opportunity to transform our healthcare system to one that provides affordable and quality care that is accessible to all. Ensuring that schools are a part of this health delivery model is a critical strategy for realizing this vision.

Unfortunately, the way we currently fund health care does not support schools in playing a key role in delivering health services to children. A number of barriers currently prevent schools from receiving reimbursement for many of the services they provide. Services such as immunizations, health screenings and management of chronic illnesses like asthma are rarely reimbursed when delivered in schools, even though the same services would be reimbursed without question if they were delivered in a doctor’s office.

One of the main barriers restricting access to funding for school health services is the free care rule.The free care rule states that Medicaid funds may not be used to pay for services that are provided for free to the entire student population. Since school health programs serve the entire school community, many of the services they provide are not eligible for reimbursement according to the free care rule.

We want to change that and believe there is an immediate opportunity to do so. Healthy Schools Campaign is petitioning the Centers for Medicare and Medicaid Services to address this barrier that prevents schools from receiving reimbursement from Medicaid.

We urge you to join us by adding your name to the statement of support (below) requesting clarification of the free care rule.

Clarifying the free care rule and allowing schools to bill Medicaid for the delivery of health services would ensure schools have additional resources to address the physical and mental health needs of students. This was a key recommendation Healthy Schools Campaign and Trust for America’s Health included in our Health in Mind report and we are excited to have the opportunity to move this recommendation forward. Please take action today by adding your name to the statement of support below and spreading the word.

Statement of Support 

We the undersigned individuals recognize the need for clarification that health services provided in schools are exempt from the free care rule. With the enactment of the Affordable Care Act, the United States has an opportunity to transform its health care system to one that provides seamless, affordable, quality care that is accessible to all. Ensuring that schools are a part of this health delivery model is a critical strategy for realizing this vision.

The Medicaid program recognizes the importance of school health services in the delivery of essential medical care to eligible children, and allows states to use their Medicaid programs to help pay for certain health services delivered to children in the schools. Yet, the reimbursement school districts receive for school health services is severely restricted by the free care rule. The free care rule states that Medicaid funds may not be used to pay for services that are available without charge to everyone in the community. Since school health programs serve the entire school community, many of the services they provide are not eligible for reimbursement according to the free care rule.

The free care rule has been the subject of dispute and lawsuits. In 2004 the U.S. Department of Health and Human Services Departmental Appeals Board ruled that the free care rule, as interpreted by the Centers for Medicare and Medicaid Services (CMS) and applied to school districts, has no basis in federal Medicaid law and that the rule, as applied to schools, is unenforceable. Most recently, CMS agreed to reimburse San Francisco Unified School District (SFUSD) for health services delivered to the general student population by school health professionals in SFUSD. CMS, however, still has not issued clarification that health services provided in schools are exempt from the free care rule.

Supporting the delivery of health services in schools by declaring that these services are exempted from the free care rule will make a difference for the health and wellness of students across the country.

We urge you to make this change and communicate it to schools across the nation.

Ready to sign on? Add your name here! 

To read more about the free care rule check out our past blogs on this issue here:

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