Medicaid Rule Change

Submitted by Tim on Tue, 02/26/2013 - 03:44 PM

Earlier this month, the U.S. Department of Education issued revised regulations on school district use of Medicaid funds, which will go into effect on in the middle of March. For those who did not know, Medicaid is a program that provides medical insurance to those with financial need. Additionally, children with severe medical need can receive a waiver to be accepted into the program (commonly known as the Katie Beckett Deeming Waiver).  

Anyway, the regulations require that a child’s parents consent to use of Medicaid to pay for services in school.1 Further, the use of Medicaid benefits may not:  

(A) Decrease available lifetime coverage or any other insured benefit;  

(B) Result in the family paying for services that would otherwise be covered by the public benefits or insurance program and that are required for the child outside of the time the child is in school;  

(C) Increase premiums or lead to the discontinuation of benefits or insurance; or  

(D) Risk loss of eligibility for home and community-based waivers, based on aggregate health-related expenditures;2  

Under the old version of the rule, the school district was required to get parental consent each time the public benefit (i.e. Medicaid) was used to pay for something. Under the new rule, parental consent is only required the first time Medicaid is used.  

Now, I represent children with special needs who are dealing with the public schools. In short, I am an IEP lawyer and a Section 504 plan lawyer, not a Medicaid lawyer. I do not know how likely it is that school district use of a child’s Medicaid benefit could screw up that child’s health insurance in the future. But if it were impossible for school districts to mess things up, no regulation would be required to tell school districts not to mess things up.  

Most importantly, the school district is obligated to provide a free, appropriate, public education whether or not you authorize use of Medicaid. The school district is expressly prohibited from conditioning services in school on your authorization to use Medicaid benefits.3  

My readers whose children receive Medicaid should be informed advocates. As a practical matter, I suggest you ask the school district (a) whether they are using your child’s Medicaid benefits, and (b) what services are being paid for with Medicaid. Perhaps the school district is providing services above the basic “floor of opportunity”4 required by law, and you want to continue providing those services in school.  

But if those services are necessary for providing a free, appropriate, public education, then consider revoking your consent to use up your child’s Medicaid benefit and save your child’s benefits for medical services that are not provided by the public schools. The school district is required to do what is necessary, and the whole point of free appropriate education is that you are not required to help pay, even indirectly.  


1 34 C.F.R. § 300.154(d)(2)(iv)(A) 

2 34 C.F.R. § 300.154(d)(2)(iii

3 34 C.F.R. § 300.154(d)(2)(i

JSK v. Hendry County Sch. Bd., 941 F.2d 1563 (11th Cir. 1991)  


Upcoming Events:  

February 27-28: I will be among the speakers at the “Across the Spectrum” Autism / Asperger Conference and Expo. Information here.  

March 7: Allison Vrolijk, a special education attorney colleague of mine, will be presenting “Parental Rights in Special Education: Advocating for Your Child in the Public Schools” at Kids R Kids in Johns Creek. More information here.  

April 19: I will be presenting “Understanding the Basics of Special Education Law” at the Art it Out Therapy Center in Marietta at 10 am. The presentation is free, but please RSVP to 770‑726‑9589.  

Have your own event for children with special needs? Submit it here for inclusion in future events lists.

Find this useful?

Previous PostNext Post