Illinois Receives Federal Approval to Expand Access to School Health Services

Healthy Schools Campaign Statement on CMS Approval
HSC Applauds Efforts Making Illinois the 19th State to Leverage Federal Funds to Improve Student Health Access and Health Equity 

CHICAGO (April 19, 2023) — Under the terms of a newly approved state plan amendment, Illinois school districts can seek federal reimbursement for all Medicaid-covered school-based health services, including mental healthcare, provided to all students enrolled in Medicaid — which will amount to a major increase in funding for school health programs.

The U.S. Department of Health and Human Services (HHS), through the Centers for Medicare & Medicaid Services (CMS), announced April 18 that it had approved the state plan amendment Illinois submitted in 2021 to expand access to, and funding for, school health services.

The previous Illinois state plan allowed billing only for students with an Individualized Education Plan (IEP), which limited reimbursement to just 14 percent of the 800,000 students enrolled in Medicaid across the state. The changes are retroactive to July 1, 2021.

“We’re thrilled to partner with states like Illinois to seize opportunities in Medicaid to expand access to health care in schools,” CMS Administrator Chiquita Brooks-LaSure said in a public statement. “CMS encourages all states to consider adopting this flexibility. It just makes sense to deliver health care services and supports to children where they spend the majority of their time: in school.”

HSC has long championed Illinois taking this action. The Chicago-based organization led a multi-year advocacy campaign with the support of Illinois hospitals, health providers, and health and education advocacy, philanthropy and community-based organizations.

“This is a huge win for Illinois students and for all the state and school officials and advocates who supported and worked on the state plan amendment,” said Jessie Mandle, HSC’s national program director. “Increasing access to school health services is especially crucial at this moment given the student mental health crisis. Schools must have the necessary resources to meet students’ needs.”

In addition to amending the state plan to allow billing for all medically necessary services outlined in Medicaid’s comprehensive Early and Periodic Screening, Diagnostic and Treatment (EPSDT) benefit, the Illinois Department of Health and Family Services (HFS) also updated the list of healthcare provider types permitted to bill Medicaid for providing services within a school setting — the list now includes licensed clinical professional counselors, licensed marriage and family therapists, and school psychologists.

Expanding services and allowing billing for additional providers helps schools build their capacity to meet the health needs not only of students enrolled in Medicaid but of the entire student population, said Mandle, noting that it also makes financial sense.

“When a state increases the number of eligible services that are billed to Medicaid, the state can draw down more funding. Not billing for services already being provided in schools means leaving federal dollars unclaimed,” said Mandle.

The state plan amendment, also known as a SPA, brings Illinois into alignment with federal Medicaid policy, which opened the door to expanding Medicaid coverage for school health services — including all eligible physical, behavioral and mental health services — at the end of 2014.

Illinois is the 19th state to expand access, according to HSC’s monitoring efforts published at bit.ly/freecareupdate. HSC also maintains an interactive school Medicaid map to track state school Medicaid activity.

More states are expected to update their school Medicaid plan in the coming years. The Bipartisan Safer Communities Act, signed into law in 2022, calls on CMS to publish updated school Medicaid guidance in 2023, establish a technical assistance center, and award $50 million in state grants to implement, enhance or expand school Medicaid programs.

In anticipation of Illinois’ SPA approval, HSC has been offering free training and technical assistance through the Medicaid Expansion for School Health Learning Collaborative to help school districts develop and implement strategies to expand Medicaid billing.

“After years of hard work, it is very exciting to finally see the SPA approved. We look forward to working with HFS, the Illinois State Board of Education and Illinois school districts on successful implementation to support the health and wellness of Illinois students,” said Mandle.