Federal attempts to shift Medicaid costs threaten schools
A planned cut in Medicaid funding could cost Florida’s Pasco County School District about $1.2 million, district officials say. The cuts are happening to school districts nationally because of an administrative rule change at the federal level that the Centers for Medicare and Medicaid Services (CMS) said was aimed at eliminating fraud, waste and abuse. The school district is working with U.S. Rep. Gus Bilirakis, R-Palm Harbor, and U.S. Rep. Ginny Brown-Waite, R-Brooksville, to get a moratorium placed on the cuts, said Summer Romagnoli, a district spokeswoman. Because the cuts came through an administrative rule change, Congress never voted on them, Romagnoli said. Medicaid is a federal program that provides health care for the poor. The school district uses the Medicaid money for a number of programs, including medical services, dental services and mental health counseling for needy students.
The school district isn't alone in trying to get Congress to intervene. The National Governors Association (NGA), in a letter dated Feb. 26, called on Congress to delay changes to Medicaid, saying the plans would shift an estimated $13 billion in federal costs to the states. CMS announced the rules change affecting schools in December, saying the federal government has had "long-standing concerns about improper billing by school districts for administrative costs and transportation services" under the Medicaid program. In some states, schools have claimed more federal dollars for administrative costs than for the services themselves, the federal agency said in announcing the cuts. Schools will still receive reimbursement for some direct medical services provided to children on Medicaid, such as physical therapy, speech therapy and transportation to medical services during the school day, the agency said.
Source: Tampa Tribune, 3/13/08, By Ronnie Blair
[Editor’s Note: Background on the long-running controversy, and the legal and legislative back-and-forth over cutting Medicaid reimbursement to schools for federally mandated services, is available starting with the Legal Clips summary of the CMS regulations at the first link below. The second link is to information and resources compiled by NSBA’s Office of Advocacy. A new report commissioned by the bipartisan group First Focus, available at the third link, finds that the new rules for Medicaid and for the State Children’s Health Insurance Program (SCHIP) will disproportionately affect children with special health care needs.
The cuts to schools are part of a broader federal effort to rein in Medicaid spending involving seven regulations, which would have the effect of shifting costs to state and local governments. The NGA letter is below. On February 29 Maine Attorney General Steve Rowe announced the filing of a lawsuit, joined by the states of Maryland, New Jersey and Oklahoma and described in the press release at the next link, challenging CMS regulations concerning Medicaid case management. A report at the next link by the U.S. House of Representatives Committee on Oversight and Government Reform provides a breakdown what is at stake for each state.
U.S. Reps. John D. Dingell (D-MI ) and Tim Murphy (R-PA) have introduced the “Protecting the Medicaid Safety Net Act of 2008,” announced at the last link below, that would place a one-year moratorium on the seven Medicaid regulations. NSBA Director of Federal Programs Chrisanne Gayle notes that efforts also are being made through budget resolutions but that the legislation is the stronger approach.]
NSBA School Law pages on CMS Medicaid regulations
NSBA Advocacy page on Medicaid reimbursement
First Focus report
NGA letter to Congress
Maine attorney general press release
House committee report on state impact of regulations
Dingell press release on legislation