What Will Medicaid Cuts Mean For School Health and Wellness Services?

Lately, Angela Reyes’ oldest daughter talks her ear off.

“Sometimes I’m like, ‘I need you to quiet down!’” Reyes laughed.

But when the now-12-year-old was a kindergartener, her speech was largely unintelligible. Reyes credited school-based speech therapy for her daughter’s progress and that of her three sons.

Reyes and her four children are among the nearly 80 million Americans covered by either Medicaid or the Children’s Health Insurance Plan (CHIP). All of her kids attend Chicago schools, receiving school-based therapeutic services reimbursed by Medicaid — the fourth-largest federal funding source for schools. Two of Reyes’ children have language disorders that affect their speech and make it difficult for them to learn to read.

“They have had issues with being able to speak and being able to form words correctly so that people understand them,” she said.

Over the last decade, schools have become health-care hubs for eligible students like Reyes’ children by providing needed physical and mental health and social services, so they can be in school and focused on learning.

But now that Congress has passed the Trump administration’s vast budget bill, which will reduce federal Medicaid spending by about $1 trillion and increase the number of uninsured Americans, Reyes worries what will happen to her children if those cuts reach schools.

District leaders expect school health services to be hit hard.

In a July media release, David R. Schuler, executive director of the school superintendents association, expressed concerns about the federal budget’s cost-shifting, which will foist more of the Medicaid funding burden onto states, resulting in “devastating downstream effects on public education funding” and “impossible tradeoffs — often at the expense of schools and the students they serve.”

District leaders named those tradeoffs in a survey about federal funding cuts by the advocacy group Healthy Schools Campaign. Most said that in addition to reductions in school health staff and services, entire district budgets will suffer.

Health Care in Schools

About half of U.S. children, roughly 38 million kids, are covered by either Medicaid or CHIP, with school-age kids comprising nearly one third of all Medicaid enrollees. Children are greater than six times more likely to access health care at school than anywhere else, making school the primary place where many kids receive health care.

“School can be a very powerful place for meeting students’ mental and behavioral health needs because [the children] are already in an environment where they’re comfortable,” said Jessie Mandle, national policy director for Healthy Schools Campaign.

Schools also make health care easier to access for families, she said. Pulling students from school for medical or counseling appointments isn’t ideal for students or parents, and in rural areas, medical offices are often an hour or two away.

In the last decade, more states have been making school-based health care available by opting in to Medicaid’s School Health Services program. Historically, under the Individuals with Disabilities in Education Act, Medicaid allowed school districts to bill for health services provided only to students with documented disabilities. But in 2014, the Centers for Medicare and Medicaid Services, the federal agency that administers Medicaid, expanded the school-based program to include services for all Medicaid-enrolled children.

Consequently, for many families, schools have become health- and social-services hubs. Students enrolled in Medicaid can get basic vision, dental and medical screenings, behavioral health screenings and services, mental health counseling, support for managing asthma and diabetes, and routine checkups.

Schools often are the first place some families learn about Medicaid and CHIP. Increased access to health care at school has helped to narrow health disparities and improve student attendance and academic success.

“We’ve seen both red and blue states taking up this opportunity to use Medicaid dollars to sustain and increase vital services for students,” Mandle said. “As an organization, we’re really concerned that that progress is at risk.”

Difficulties Ahead

What’s next for school-based health services since the budget passed is unclear, according to leaders from national organizations that represent school health clinicians. Although it will reduce federal Medicaid spending by 15 percent over the next decade, it doesn’t call for direct cuts to school Medicaid. Instead, it introduces new work requirement rules for adult Medicaid recipients and those with dependent children.

“It’s a behemoth bill,” Kelly Vaillancourt, director of advocacy and policy at the National Association of School Psychologists, said of the new budget. “A lot of school Medicaid experts are really still unpacking it.”

Even so, professional organizations have gleaned enough to fear the fallout on their members. Kate King, immediate past president at the National Association of School Nurses, predicted schools will have fewer school nurses, who are often the first or the only health-care provider students encounter at school. Research shows that a lower-student-to-nurse ratio relates to better student attendance.

Coupled with the loss of Medicaid coverage for many families, which can affect whether their children are insured, students and their families will be less healthy, King said.

“They’re not going to get preventive care. They’re not going to get initial chronic disease care, and they’re going to become sicker,” King said, “which will cost everybody a lot more money.”

State health agency officials agree that school health services will be weakened. A spokesperson for the Illinois Department of Healthcare and Family Services said, “Cuts to federal funding will lead to reduced services, as states cannot make up the funding gap…harming students in the process.” Centers for Medicare and Medicaid Services did not respond to requests for an interview.

Reyes is scrambling for solutions, such as trying to mimic speech therapy at home in case her children stop receiving it at school.

“I’m showing them how to move their mouth, in ways that a speech therapist would,” she said.

Benefits For Every Student

Schools use a variety of sources to pay for health services, including grants, private donations, and state and local education funding. The majority of funding for school health care comes from Medicaid and CHIP.

According to the Healthy Schools Campaign survey, district leaders use Medicaid funds in three ways:

• support salaries for school health staff
• provide increasingly in-demand in-person and telehealth mental and behavioral health care
• buy assistive technology and specialized equipment, which includes hearing aids, wheelchairs and text-to-speech devices that dictate writing for students with fine motor skills, and assistive listening devices that help students with hearing impairments or auditory processing disorders

“Medicaid and CHIP really have such a significant impact on the health and well-being of students,” Healthy Schools Campaign’s Mandle said. “[They provide] a wide variety of services to keep kids learning.”

Maredeth Teamer, a claims analyst for Illinois’ Oswego Community Unit School District 308, which serves 17,000 students, said that knowledge is power for district Medicaid coordinators, especially now that federal Medicaid to states will decrease.

The key to maximizing Medicaid reimbursement dollars, Teamer said, is for districts to get a solid understanding of Medicaid policy and the reimbursement process in general.

“Know your budget, your district, your families,” Teamer said. “We’re going to have to count every penny. We should be doing that anyway.”

Typically, schools bill Medicaid directly. State Medicaid offices reimburse schools for the cost of health services not covered by the disabilities in education act, administrative and outreach costs associated with Medicaid, and certain other costs above what reimbursements have covered.

Mandle said the reimbursement process can help schools optimize funding to meet the needs of all students, but it depends on the state — only half of them have followed through on Medicaid expansion — and on how well a district implements school Medicaid.

“When a district gets better at leveraging Medicaid, it frees up [unrestricted grants or education] funds to be used elsewhere,” Mandle said.

“Medicaid funding makes the overall pie better for the entire student population,” she said.

Uncertainty Sparks Concern

About 90 percent of district leaders believe federal Medicaid reductions will hurt entire district budgets, not just school health services, according to the Healthy Schools Campaign survey.

“What we heard is, ‘We’ll have to cut other [education] programs in order to meet [mandated services under the disabilities act] because we have less money.’ Or they’ll have to raise taxes,” Mandle said.

The survey concluded that tradeoffs like these, coupled with cuts to health services, will harm students and their academic performance and attendance, leading to increased strain on teachers and school staff to fill in support gaps.

“There’s going to be less support for students with mental, behavioral and physical health needs,” Mandle said.

King with the school nurses association agreed.

“We know that a school nurse in a school saves more than 90 minutes of time for administrators, teachers and clerical staff in doing that care. [Those staff] have other work to do.”

Families will suffer as well, both Mandle and King say. Because schools are the primary source of health care for so many families, those who lose Medicaid eligibility because of the tightened work requirement rules under the new budget act are likely to experience financial strain as they try to shoulder the burden of accessing and paying for medical care.

“It’s harder to get and keep jobs for the Medicaid population than people think,” King said. “Those jobs [often] are manual labor or service jobs. [If Medicaid recipients] don’t have health care, if they don’t have sick days … if you miss three days, you’re sometimes just gone. You don’t have a job anymore.”

Teamer, the Oswego claims analyst, is most concerned about the immediate effects of the work requirements on parents’ access to disability diagnoses for their children, most of which come from non-school-based health-care providers.

“If families don’t have health care, they’re not getting [referrals for IEPs] anymore.”

King also sees longer-term negative consequences for families, especially those who already face financial insecurity.

“If their Medicaid is cut, they will be sicker,” King said. “If they are sicker and they can’t get their medicine, they will be buying medicine, maybe, instead of food. It’ll be harder to pay their rent. They will have less [capacity] to help their children.

“People don’t see that whole picture.”

Angela Reyes worries about the tradeoffs that she might face. But her concerns go beyond her own children.

“I think that [the budget act] is going to deepen de-facto segregation. Black and Brown kids are the ones that have the hardest time getting onto IEPs and getting Medicaid help, and they are also the ones that are oftentimes first to be cut,” she said.

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