When federal funding is more gray than black and white, it’s frustrating. There's no cut-and-dry way to define acceptable uses. And while that murkiness lends itself to more creativity, it also leaves schools vulnerable to audits and large bills.

So, what can districts do? 

• Ignore these underused funding sources only to disservice their students?
• Or, apply those funds and hope the way they're used is deemed acceptable?

School budgeting is grim. Now that ESSER funds are no longer, districts nationwide are experiencing unprecedented shortfalls. Having another funding source to tap into gives schools respite and relief.

Schools can use Medicaid funding for Student Health Services

Medicaid can reimburse schools for certain student health services. But eligibility varies by state. Generally, services provided to Medicaid-enrolled students—especially those with IEPs—qualify for reimbursement.

In some states, schools can receive reimbursement for services not just for students with IEPs but for any student on Medicaid. 

These services might include things like:

• Nursing care (e.g., helping with medications or health conditions at school)
• Speech and occupational therapy (e.g., helping students with speech or communication challenges)
• Mental health services (e.g., counseling or therapy for emotional well-being)

It's a way for schools to get financial help to provide healthcare-related services to qualified students.

States using Medicaid to fund Special Education

Twenty-six states use Medicaid as a funding source for special education services. Idaho recently joined the list, and West Fargo Public Schools is taking full advantage. Director of Special Education Rachel Kjonaas shares: 

"It's an easy grab at some money that helps us to sustain the good work that's happening behind the scenes: the work of our social workers, our mental health therapists, our school counselors."

But Idaho isn’t the only state that’s felt relief with Medicaid funding options.

Louisiana led the way by first expanding Medicaid to cover school nursing services, increasing federal revenue by 35%. The success led to a second expansion to cover all eligible providers and services.

Colorado piloted an expansion by adding Medicaid-eligible providers, including school behavioral health staff. Despite pandemic challenges, the first phase brought in $2.75 million in new federal funds in 2020-2021, with further increases expected as school psychologist billing went live in 2022.

Georgia estimated that expanding Medicaid billing to include school nurses alone could generate $48.6 million in federal revenue.

Michigan expanded Medicaid to all enrolled students and additional providers, securing $12 million for services provided to students without IEPs and increasing IEP-related reimbursements by $20 million.

These states found a way to bring in sustainable funding. Unfortunately, many states relied on ESSER funds to cover staff salaries. Now that those funds have run out, districts wonder how to maintain their programs. Medicaid expansion offers a long-term solution to fund essential services without relying on temporary relief money. But there is a catch.

Medicaid’s impact on schools & why staying informed matters

Medicaid is a powerful funding source, but schools need to stay proactive. Regulations and reimbursement policies change, sometimes overnight. And the conversations surrounding federal funding as of late, have been confusing.

Take, for example, recent cases where school districts were unexpectedly asked to repay Medicaid funds due to administrative errors made years earlier. The districts had rightfully used the funding to support students, but due to coding issues outside their control, they were later required to return money. The financial strain on their budgets was immediate and significant.

Situations like these serve as a reminder that Medicaid funding isn’t set in stone. With Medicaid funding up for debate at the federal level, schools must prepare for whatever comes next. It’s hard to imagine and plan for more funding shifts, especially when resources are already stretched thin, but thinking ahead helps districts avoid tough financial decisions before they happen. While a sudden cutoff is unlikely, gradual changes or phase-outs could impact future budgets, so it’s best to be prepared.

Staying ahead starts with:

• Maintaining proper documentation
• Building strong state partnerships to ensure schools receive the funding they’re entitled to.
• Advocating for clear, sustainable Medicaid policies protects student services in the long term.

Schools that stay informed, document services properly, and build strong Medicaid partnerships can continue using Medicaid to support students without financial risk.

How to use Medicaid for Special Education

Administrators can take these steps to receive Medicaid funding for tools and services:

1. Understand state rules:
   • Use the School Medicaid Expansion Map to see what your state allows.
   • Check whether non-IEP services are eligible in your state.
2. Involve licensed providers:
   • Partner with staff to incorporate assistive tools into IEPs and care plans.
3. Ensure proper documentation:
   • Track how tools meet educational and therapeutic goals. Documentation maintains compliance and eligibility for reimbursement.
4. Advocate for expansion:
   • If your state hasn’t broadened Medicaid to include non-IEP services, consider advocating for a policy update.
5. Collaborate with state agencies:
   • Partner with your state Medicaid agency to streamline billing and avoid administrative errors.

Make Medicaid work for your school with Clicker

Clicker is an assistive technology tool for students with learning and writing challenges. It aligns with Medicaid's goal of improving access to essential services. 

Here's how Clicker fits in:

1. Supports documented services
   Clicker can be part of a speech or occupational therapy plan, making it eligible for Medicaid reimbursement in many states.

2. Builds measurable learning outcomes
   Clicker defeats writing barriers for students. When barriers are broken, every student can fully participate in classroom activities.

3. Promotes compliance
   Its measurable impact helps schools track and prove why it should be covered by Medicaid.

Medicaid funding helps schools support special education and inclusive learning environments. Challenges exist, but aligned use cases and resources provide attainable, documentable benefits. Districts are strategic planners, so with that comes compliance. In that way, schools can feel confident they're applying funding to resources that serve their students well.

Don't let the complexities of Medicaid funding deter you. With the right plan, it can support more students, remove obstacles, and make education accessible for everyone.

Want to learn more about how Clicker can help your school tap into Medicaid funding?