"No Child Left Behind" -- unless the child is disabled then the"compassionate conservatives" will th

Area Schools Set To Lose Millions Under Medicaid Policy Changes

By Maria Glod

Washington Post Staff Writer

Sunday, February 3, 2008; A01

Educators nationwide are protesting a Bush administration move to

curtail hundreds of millions of dollars in Medicaid funding for

disabled students that could force some schools already in budget

straits to trim health services or cut back instructional programs.

The shift in federal reimbursement policy threatens to strip about

$635 million from schools in the next academic year and $3.6 billion

over five years, with Washington area schools in line to lose millions

of dollars. The rule, to take effect in June unless Congress

intervenes, will bar schools from billing Medicaid for busing special

education students to and from school and for certain administrative

expenses, including enrolling children in Medicaid and coordinating

and scheduling services.

Administration officials said schools, required under federal law to

provide education to children with special needs, should pick up the

bill for expenses that are part of their "educational mission." But

educators said it would further strain schools in a time of lean

budgets, hitting big city and poor rural systems hardest.

D.C. schools would lose about $5 million in the first year in busing

reimbursement, according to a spokeswoman for Mayor Adrian M. Fenty

(D). Virginia has recouped $31 million in Medicaid dollars over the

past five years for services that would no longer be covered, with

Fairfax County schools alone projecting a $1.8 million loss next year.

That's the equivalent of employing 25 teachers. The county's schools

this year face a range of budget cuts that would pare back summer

school and raise average class size.

Maryland school officials estimate that nearly $1 million in federal

funding would dry up statewide next year under the rule, with the

greatest impact in Baltimore, which recouped about $593,000 in one

recent year, and Prince George's County, which was reimbursed

$106,000.

Educators in states including California, Mississippi and North

Carolina wrote the government to protest the rule. Officials of some

schools said absorbing such expenses could mean dipping into general

education programs or cutting back on school nurses or counselors. In

one letter, Virginia state Superintendent Billy K. Cannaday Jr. said

school systems will continue to help enroll children in Medicaid and

coordinate services but will have to "shift funds from other areas in

their budgets to cover the costs or raise taxes if this proposal

becomes a reality."

The Centers for Medicare and Medicaid Services proposed the rule in

September, and it was made final in December. But congressional

Democrats slipped a six-month moratorium into legislation passed

before the end of the year.

Dennis G. Smith, director of the federal Center for Medicaid and State

Operations, said the change will help reign in a system in which

federal auditors have found improper billing in some states. He

emphasized that schools will still be reimbursed for direct medical

services, such as physical or speech therapy, as well as for

transporting children to a doctor's office or therapy session if it is

scheduled off campus during the school day.

"This is not about medically necessary services," Smith said. "We will

continue to pay for those types of services. Medicaid was being used

simply to leverage revenues for activities that had very little to do

with serving children on Medicaid. Schools already have responsibility

to transport all children, not just Medicaid children, to school. That

should not be billed to Medicaid."

Health advocates and Democratic lawmakers criticized the change as a

rash shift that ultimately could result in fewer needy children

connecting with health services.

"This is a huge change in law," said Sara Rosenbaum, chairman of the

Department of Health Policy at the George Washington University School

of Public Health and Health Services. "This could have an impact on

the number of children enrolled in the program and the number of

children who are assisted in getting health care. Whatever concerns

there were about schools administering Medicaid . . . are totally

outweighed by what [the administration] has done here."

Rep. John D. Dingell (Mich.), the senior Democrat in the House, called

on the administration to "reconsider this misguided rule and start

working with Congress to better serve and support America's most

vulnerable children." Dingell and other lawmakers have introduced a

bill to reverse the rule, requiring Medicaid to cover certain

administrative costs for schools and the cost of transporting children

with disabilities who go to school in specially equipped or staffed

buses.

P.J. Maddox, chairman of the Department of Health Administration and

Policy at George Mason University, said the conflict highlights the

challenge schools face with the growing cost of educating children

with disabilities. Federal law requires schools to provide services to

disabled students, but the federal government gives schools only a

portion of the money needed to cover extra costs. Schools, she said,

have turned to Medicaid to help offset expenses.

"This Medicaid change cuts off that help, which leaves the school

system holding the bag," Maddox said. "Who pays for it? The school

system will have to pay for it."

Medicaid officials contended, in their written response to public

comments on the rule, that cash-strapped schools have a "strong

incentive to shift costs to Medicaid for activities that would have

been performed by schools in the normal course of their operation" and

that schools should find other sources for money. In recent years,

reports from the inspector general of the Department of Health and

Human Services have found that schools inappropriately sought

reimbursement for school administrators' salaries, capital costs and

even such items as antacids and lice combs.

Educators acknowledged some problems with billing but said Medicaid

should tighten rules and offer more guidance, not simply cut off the

dollars.

Maryland officials are concerned about the fallout for Baltimore and

Prince George's schools.

"It's a lot of impact on the two jurisdictions that have the largest

numbers of the neediest children," said Carol Ann Baglin, an assistant

state superintendent in Maryland. "They are going to have to take

funds from somewhere else in a very tight fiscal time and put them

into transportation."

Late last month, Los Angeles school officials went to Capitol Hill to

lobby against the rule, saying their school system, the nation's

second largest, could lose $10 million a year in reimbursement. John

DiCecco, director of the system's community partners and Medi-Cal

programs, said he expects to lay off 10 outreach workers who have

helped enroll thousands of children in Medicaid.

DiCecco said the system also uses Medicaid funds to encourage

nonprofit and community groups to donate to help the schools run

health clinics and offer vision and dental screenings.

"There's no question if this goes away, at least in Los Angeles, the

health status of children will directly suffer," DiCecco said.

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