Increasing Medicaid Funding for School Health Services
Increasing access to school health services is critical to reaching underserved children. Until recently, schools were very limited in their ability to use Medicaid funding to provide healthcare services in schools. Due to a federal Medicaid policy known as the “free care rule,” schools were previously only able to obtain reimbursement for services included in the Individualized Education Plans (IEPs) of Medicaid-enrolled students and in other limited situations.
In 2014, the reversal of the free care rule at the federal level allowed schools to receive Medicaid reimbursement for eligible healthcare provided to any Medicaid-enrolled student. This has created tremendous potential for school districts to use Medicaid funds to support and enhance their physical and behavioral health services. However, states must update their Medicaid programs before schools can take advantage of this opportunity.
Healthy Schools Campaign works extensively to support states, school districts, and other stakeholders in translating this change into practice, including:
- Helping policymakers understand how existing laws in their state might limit Medicaid reimbursement for school health, develop strategies to expand school-based Medicaid programs, and implement trainings to leverage the new funding
- Creating targeted policy recommendations and guides to support stakeholders in working to expand access to school health services, including building support for policy changes at the state and local levels
- Advising state Medicaid agencies and state education agencies on how to assess the leading health issues impacting students in the state to ensure the health services needed to address those issues are Medicaid reimbursable
- Recommending ways that federal agencies can offer support, technical assistance and replicable models to states and school districts in expanding Medicaid programs
Healthy Schools Campaign also runs two learning collaboratives to facilitate the expansion of Medicaid-funded school health services:
- The Healthy Students, Promising Futures Learning Collaborative brings together state teams committed to increasing access to Medicaid services in schools and promoting safe and supportive school environments.
- The Medicaid Expansion for School Health Learning Collaborative convenes school district teams from across Illinois to develop and implement strategies for expanding Medicaid billing for school health services and using the additional funds to provide new services and support for students.
Read more about our national efforts to expand access to school health services.
Supporting Illinois School Districts
The Illinois Department of Healthcare and Family Services (HFS) is in the process of expanding the state’s school-based Medicaid program to allow reimbursement for additional services and providers. Illinois’ state plan amendment (SPA), which was submitted in 2021, received federal approval in 2023. It allows school districts to access significant funds to provide services such as comprehensive health screenings, chronic condition management and mental health supports for any student enrolled in Medicaid.
Learn more about the SPA and Healthy Schools Campaign’s advocacy to support this change.
To assist school districts in taking advantage of this opportunity, Healthy Schools Campaign launched the Medicaid Expansion for School Health (MESH) Learning Collaborative in 2021. Through this collaborative, Healthy Schools Campaign provides free training, technical assistance, and peer-learning opportunities to support school districts in expanding Medicaid billing for school health services and using the additional funds to provide new services and supports for students. By 2025, Healthy Schools Campaign aims to enroll 30-45 school districts in the collaborative.
Lessons learned from these early adopters will be documented and shared with other school districts as well as with HFS and the Illinois State Board of Education (ISBE) to inform state policy and practice. Through this initiative, HSC aims to strengthen statewide infrastructure to support comprehensive school health services and disseminate effective strategies and models for Medicaid-funded school health services expansion that can be replicated by other school districts and states.
Participating School Districts
Addison School District 4
Chicago Public Schools
Consolidated High School District #230
Granite City CUSD #9
Huntley Community School District #158
North Chicago School District #187
Keeneyville School District #20
Wheeling Community Consolidated School District #21
Advisory Committee Members
Illinois Alliance of Administrators of Special Education
Illinois Association of School Business Officials
Illinois Association of School Nurses
Illinois School Counselor Association
Illinois School Psychologists Association
National Association of School Social Workers, Illinois Chapter
Carrie Chapman and Barbara Cohen, Legal Council for Health Justice
Increasing Access to School Health Services
As of April 2023, 19 states have expanded their school Medicaid programs, increasing access to school health services for more than 15 million children. (View the state activity tracker for the latest state updates.)
Healthy Schools Campaign has provided direct support to 12 of these states, including eight states in the Healthy Students, Promising Futures Learning Collaborative.
Ongoing Support & Success
Via targeted technical assistance, peer-to-peer learning, and opportunities to engage with federal agencies and national policy experts, HSC has supported multiple states in identifying and overcoming barriers to cooperation across state and local agencies and challenges to implementing new federal flexibilities. Their successes include:
- Improving health outcomes by increasing access to Medicaid-funded school health services and expanding the types of eligible health providers.
- Increasing sustainable federal revenue for states and school districts.
- Developing state-level guidance for the health and education systems, such as data sharing and coordination with managed care organizations.
- Forming new, cross-sector partnerships among state agencies, local school districts and state/local partner organizations.
HSC’s work in Illinois builds on this success. To date, 28 school staff from seven districts are enrolled in the Medicaid Expansion for School Health Learning Collaborative. HSC also works closely with HFS, ISBE and state partner organizations to support statewide implementation of the expanded school Medicaid program.
Learn more about expanding Medicaid-funded school-based health services.
Frequently Asked Questions About the Illinois State Plan Amendment
This FAQ explains the benefits and changes that school districts can expect once the Illinois state plan amendment is approved.
How Illinois Can Leverage Medicaid Funds to Expand School Health Services
Building off “Schools Are Key to Improving Children’s Health,” this brief looks at the state of children’s health and school staffing in Illinois and outlines the steps Illinois must take to amend its Medicaid state plan and increase access to health services.
Schools Are Key to Improving Children’s Health
This national policy brief addresses the opportunities to expand health services delivered within a school by school nurses and other district-employed providers.
A Guide to Expanding Medicaid-Funded School Health Services
This comprehensive, step-by-step guide provides background on school-based Medicaid and outlines various opportunities to advance state policy changes required to access federal funds.
Healthy Students Promising Futures
HSC’s program website offers information for states and school districts interested in learning more about federal policy and increasing access to Medicaid services in schools. HSC’s work includes providing technical assistance to states and leading a national learning collaborative.
State Medicaid and Education Standards for School Health Personnel
This report, published at Healthy Students, Promising Futures, reviews reimbursement challenges in all 50 states and demonstrates how alignment between state Medicaid and education standards for school health personnel can reduce barriers to Medicaid reimbursement for school health services.
Medicaid 101 for School Superintendents
This brief explores what Medicaid is, what it covers — in and out of school — and how school districts can leverage Medicaid to enhance school health services.
Case Studies: How States Are Expanding School Health Services Using Medicaid
These case studies reflect the work states have completed, and the success they have achieved, in leveraging federal Medicaid policy to expand physical, behavioral and mental health services.
State Efforts to Expand School Health Services: Activity Tracker
This regularly updated brief tracks state efforts to expand access to school health services, either through a state plan amendment or through legislative/administrative action, allowing school districts to bill Medicaid for health services delivered to all Medicaid-enrolled children.
School Funding and the Illinois Healthy Student State Plan Amendment
In this recorded webinar, learn about a federal policy shift that allows billing for all health services provided to all students enrolled in Illinois Medicaid. The webinar explores how more than a dozen states already are leveraging this opportunity to increase school nursing staff, hire school psychologists, and create sustainable funding streams.
Introduction to Expanding School Medicaid Programs Webinar
This webinar recording describes the Medicaid program and what it covers, discusses how school districts can leverage Medicaid to enhance school health services, and provides information about the free care policy reversal and how states are leveraging this opportunity to expand their school-based Medicaid programs. Tips are shared on how key stakeholders, including school health providers and school superintendents, can support this work in their states and communities.
An In-Depth Look at Expanding School-Based Medicaid Programs
This recorded webinar provides an in-depth look at trends in expanding school-based Medicaid programs, including detailed information about how states have successfully structured their programs. Presenters from Colorado and Michigan share how they expanded their programs and highlight key decisions they made along the way.
Sample Parental Notice for Consent to Allow the School District to Access Medicaid Benefits
Sample parental consent form developed by the Illinois State Board of Education.
Supporting Child and Student Social, Emotional, Behavioral, and Mental Health Needs
This U.S. Department of Education report provides information and resources on promoting mental health and social-emotional well-being among students. It specifically mentions Medicaid and “free care” opportunities.
Guidance on Using COVID Relief Funding to Support School Health
Discover how COVID relief funding to support school health can be used for capacity building and infrastructure, and also to access additional funding streams, such as Medicaid, to ensure the efforts initiated with federal funds are sustained.
Schools Are Key to Improving Children’s Health: How Illinois Can Leverage Medicaid Funds to Expand School Health Services
This brief addresses the steps Illinois must take to amend its state Medicaid plan and increase access to school health services. It includes school provider staffing and student health metrics and lessons learned from other states.