Proposed Healthcare Changes Reduce Funding to Special Education

While recent efforts to repeal the Affordable Care Act (ACA) have failed, lawmakers passed the measure through the House of Representatives this Thursday, May 4th, 2017. Next, the proposal will go to the Senate. Parents of children with disabilities have another chance to make themselves heard.

Recently, there has been much debate over healthcare in the United States and the form that healthcare insurance and coverage should take. Recent repeal efforts are codified in a document called the American Health Care Act (AHCA), a proposal which cuts Medicaid funding deeply. While much debate has centered on health insurance and personal health care costs, there is one area deeply impacted by the proposal that is less well-known: special education.

How Would the AHCA Impact Special Education Services?

Proposed AHCA changes impact a number of special education services and programs, as special education programs depend heavily on Medicaid funding to provide services and equipment for students, ranging from feeding tubes to physical therapy.

Proposed changes include a 25% cut to Medicaid funding over a decade and impose a ‘per-capita cap’ on funding for certain groups of people, including children and the elderly.

According to the School Superintendents Association (AASA), school districts receive about $4billion/year in Medicaid reimbursements. A recent survey shows that nearly 70% of districts report using these reimbursements to pay the salaries of specialized healthcare staff who serve children with disabilities.

While advocates for the proposal argue that the AHCA would cut costs, opponents argue that the changes are a method of rationing healthcare. Costs formerly paid by Medicaid would be transferred to states. Opponents argue that this results in higher taxes, eligibility cuts, or curtailed services for children. They highlight that schools would then have to compete with other organizations (such as hospitals and clinics) for funding to serve children eligible for Medicaid.

Children with Disabilities Receive Limited Services

Under the Individuals with Disabilities Education Act (IDEA), school systems must provide high-quality educational services to children with disabilities. For children with disabilities, who may require structural supports or accommodations, Medicaid serves as a key resource for service provision. Decreased funding means fewer students can receive services, or service availability will be much more limited.

Under the proposed bill, states no longer have to consider schools to be eligible Medicaid providers – meaning they would not be eligible for Medicaid reimbursement. It is noteworthy that local schools are already reimbursed for only a fraction of the costs of services they provide – about 1%, according to the National Alliance for Medicaid in Education.

The Takeaway: Students with Disabilities Lose Out Under Proposed Medicaid Cuts

Even without funding, schools are legally required to provide services – but without Medicaid reimbursement, tight financial situations for schools become even tighter. The proposed changes to Medicaid under this proposal could reduce service availability for students with disabilities.

What Can Parents of Kids with Disabilities Do?

Parents of children with disabilities may find it helpful to contact their governmental representatives and weigh in against this proposed healthcare change. You can start with the Congress Find My Representative tool and call or email your representative about your opinion.


[NYT] A Little-Noticed Target in the House Health Bill: Special Education


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