Free Care Policy

In 2014, the Centers for Medicare and Medicaid Services (CMS) issued a state Medicaid director letter reversing the free care policy. This change permits states more flexibility in their school-based Medicaid programs by allowing school districts to bill Medicaid for health services delivered to all Medicaid-enrolled children, not just those with a special education plan documented by an Individualized Education Program (IEP). Increasingly, states and school districts are seizing this new opportunity in Medicaid to expand access to and resources for school health services, which in many states entails changes to their state Medicaid plans and state guidance. States are increasingly pursuing these changes, recognizing the growing need to provide health services and supports to children where they spend the majority of their time: in school. 

For updates on state activity, please refer to the following brief: State Efforts to Implement the Free Care Policy Reversal

Featured Resources

resources Medicaid Reimbursed Rehabilitative Behavioral Health Services in Schools: A South Carolina Case Study

This case study examines the implementation of Medicaid managed care school-based behavioral health services in South Carolina and highlights key lessons learned that can inform the efforts of other states choosing to coordinate school-based health care with Medicaid managed care programs.

resources A Guide to Expanding Medicaid-Funded School Health Services

This comprehensive guide provides background on school-based Medicaid and outlines various opportunities to advance state policy changes required to access federal funds. It is designed for anyone working to expand access to school health services, including state and local education agency staff, state Medicaid agencies, school health providers, public health professionals and children’s health advocates.

resources Expanding Michigan’s School-Based Medicaid Program

This Healthy Students Promising Futures Learning Collaborative case study highlights Michigan's work to leverage the reversal of free care policy to expand the state's school-based Medicaid program.

As of October 2019, school districts in Michigan are able to seek Medicaid reimbursement for services provided to all Medicaid-enrolled students (not only for health services included in a student's Individualized Education Program). This change presents an important opportunity to expand access to and resources for school health services, particularly behavioral health services.

resources Medicaid 101 for School Superintendents

This brief for school superintendents provides an overview of how school districts can leverage Medicaid to support children's educational and health outcomes.

resources State Efforts to Implement the Free Care Policy Reversal

This activity brief, maintained by Healthy Schools Campaign and Community Catalyst, outlines state actions to implement the reversal of the free care policy. Some of the information in this brief is based on informal conversations with policymakers and advocates. This document is updated as changes are known to the HSPF team.

resources Increasing Access to Services and Supports for Trauma-Informed Schools in California

This case study provides an overview of trauma-informed schools and highlights California’s approaches for supporting safe and supportive learning environments by increasing access to trauma-informed services and supports in schools.

resources Massachusetts School-Based Medicaid: Lessons Learned from Expansion/Free Care Preparations

Presentation from the December 2018 Healthy Students, Promising Futures symposium on MA’s school-based Medicaid program and their plan for expansion following approval of their free care policy reversal SPA.

resources Medicaid in Schools

This issue brief describes coverage of school-based services under Medicaid and how states pay for them.

resources CMS Approves State Plan Amendment for Massachusetts, Creating New Opportunity for School-based Medicaid

This brief provides an overview of the Massachusetts Medicaid state plan amendment (SPA) approved by CMS that enables schools to bill for Medicaid services provided to all Medicaid-enrolled students.

resources Policy Considerations for California Following the 2014 Reversal of the Medicaid “Free Care Rule”

This brief describes the federal policy change and recommends implementation steps that would maximize the potential for schools to play a strong role in transforming health care delivery.