The Free Care Rule: Why Schools Deserve More Funding for Student Health

February 13, 2013

Forty percent of school-age children miss three or more days of school per year due to illness, and it isn’t just the flu — chronic illnesses such as diabetes and asthma are more common and remain unmanaged.


School nurse Saria Lofton keeps her students safe and active on the playground.

Forty percent of school-age children miss three or more days of school per year due to illness, and it isn’t just the flu — chronic illnesses such as diabetes and asthma are more common and remain unmanaged. Mental and emotional health issues urgently need addressing as well. 

Although all children have the potential to achieve in school and deserve a great education,  children who suffer from unmanaged conditions and illnesses are more likely to fall behind.

At HSC, we believe in increasing funding and access for school nurses and health services. One critical avenue that can lead to progress? The clarification of the free care rule. 

What is the free care rule?

School nurses should be reimbursed for their work, as they would be for working in a doctor’s office. But HSC believes that a misinterpretation of the free care rule is standing in the way. The free care rule states that Medicaid funds may not be used to pay for services that are provided for free to everyone in the community. For example, if all children in a school receive hearing evaluations, Medicaid cannot be billed for the hearing evaluations provided to Medicaid recipients unless all students, regardless of insurance status, are billed for the services as well.  

Why is the free care rule standing in the way of student health?

As currently interpreted, the free care rule requires that schools bill a variety of private insurers as well as Medicaid, creating a tangled web of paperwork that many schools can’t even begin to navigate.

How can we make positive change for student health?

HSC believes that a simple clarification will make a big impact. We’re asking lawmakers to clarify that the free care rule does not apply to schools. In fact, schools should bill Medicaid for the services they are providing.

Why is this clarification of the free care rule so important?

School health services, when properly funded, can be a lifeline. School nurses provide critical health services in schools across the U.S. — they’re not just for Band-Aids and saltines, despite the stereotype.

Kentucky is one state where schools are permitted to bill for health services through Medicaid, and therefore can in part provide more funding for school nurses. In large, rural Hopkins County, nurses received more than 33,000 visits, with more than 6,000 unique ones among the county’s 14 schools. Attendance and immunization rates improved, as has the Early Periodic Screening, Diagnosis and Treatment (EPSDT) rate.

As Alexis Seymore-Dawson, a teacher in the area, explained, “School health is often the only health care my students receive.”

Results can be seen in urban school health, too. San Jose Unified School District was part of a five-year demonstration placing full-time school nurses at two elementary and two middle schools and linking them with an FQHC-certified school health clinic. The results were remarkable: a dramatic decrease in ER visits for asthma, a decrease in student absences and the school district saved thousands in Average Daily Attendance funding.

What is HSC doing to clarify the free care rule?

HSC is continuing to engage with the U.S. Department of Health and Human Services to allow for and implement this increase in funding for school health professionals.

How can I help?

We encourage parents, teachers, nurses and community members to take a look at our Health In Mind report, created in partnership with Trust for America’s Health, detailing recommendations to Secretaries Arne Duncan and Kathleen Sebelius on how to incorporate health and wellness into education policy. Look into your own schools and communities. See if there is a focus on school health; learn whether a nurse or other professional is present in your school, and discover what kind of health initiatives are already offered. Together, we can take even more steps for healthier schools and students through the amazing work of school nurses.