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Medicaid Special Education Cuts

Joann Courvoisier (right) teaches students in her High School Transition classroom May 17 at Tri-County Central in Murphysboro. Courvoisier helps students 18 to 22 years old work to become more independent. Classes like hers and others throughout the region may face cuts to Medicaid funding if the American Health Care Act is passed through the U.S. Senate without changes. 

MURPHYSBORO — A close read of the proposed health care reform bill passed earlier this month in the U.S. House of Representatives, as well as the White House's new proposed budget, reveals a potentially unintended but never-the-less real consequence for its cuts to Medicaid — dramatic cuts to special education programs in schools.

Schools in Illinois have access to Medicaid funds in order to bill for some federally-mandated special provisions for students with individual education plans. Vickie Glenn, Medicaid coordinator for Tri-County Special Education, painted a picture of what this looks like. She said if a student comes to school and their learning is affected by a speech problem, under the Individuals with Disabilities Education Act, schools are mandated to provide them with care that will help them overcome this struggle and learn at the same level as other students.

The same goes for students who may require special physical therapy throughout the day — they are entitled to be cared for during the school day and the school is required to foot the bill.

This is a lot for schools to handle on their own, as some could be required to hire a full-time therapist to accommodate one student, costing thousands of dollars.

This is why co-ops like Tri-County are formed. Tri-County, which is funded by federal, state and local dollars, shoulders the burden of paying for specialists — such as physical therapists or social workers — to help schools help their students.

Jan Pearcy, director of Tri-County Special Education, said her center serves 2,500 students in 20 school districts set across Perry, Jackson and Union counties. She said everyone on her staff loves the work they do, helping students anywhere from Pre-K to 22 years old with a range of needs. It is work that, she said, often pays in emotional rewards, offsetting low salaries.

“Nobody ever gets into special ed for the money, that’s for sure,” Pearcy said.

For her, being able to see their students lead happier, more independent lives means a lot. Serving children is their prime directive, both personally and legally.

However, Pearcy said while the feds require schools to offer this help, they don’t give them the funding to do it.

This is where Medicaid comes in, as schools are able to bill Medicaid for services given to students who are enrolled in the federal program on the day of treatment. This helps offset the cost of providing these services and reduces the amount of funding they have to leverage from other sources.

The amount schools get back from Medicaid, though, is only a fraction of what is needed. Glenn said they receive half of the actual cost of services after billing Medicaid.

“What the problem is, again, is even with billing for these services … it doesn’t cover the cost that school districts must provide,” she said.

A change in distribution

The recently proposed Medicaid cuts in place in both the White House’s proposed 2018 budget as well as the American Health Care Act would both reduce funding for Medicaid by more than $600 billion to $800 billion and could also change the way states receive funding.

In its proposed budget, the White House gives states an option in how they will choose to administer Medicaid funding — they can use a block grant or per capita funding.

“States will have more flexibility to control costs and design individual, State-based solutions to provide better care to Medicaid beneficiaries. These reforms are projected to save $610 billion over 10 years,” the budget reads.

The AHCA, passed by the House earlier this month, has similar language.

“A state Medicaid program may elect to receive, for any 10-year period beginning no earlier than FY2020, federal funding in block grant form. The bill establishes a formula, using targeted spending caps, for determining the amount of block grant funds,” section 121 of the resolution reads. The Congressional Budget Office estimated in March that the bill would eliminate $810 billion of federal Medicaid spending.

Glenn said this shift to a block grant format wherein the state government would come up with a formula to disperse the funds throughout the state is worrisome. She said this would mean less for students in Southern Illinois.

“It will be at our disadvantage, I will tell you. It always has,” Glenn said of the redistribution of funds.

She said it is her belief that any new formula created to distribute Medicaid money would benefit areas north of Springfield.

“I would say 90 percent of the money will go to Chicago,” Glenn said.

This redistribution option was by design. In an emailed response from his staff to The Southern, U.S. Rep. John Shimkus, R-Collinsville, said while the law is not perfect, the AHCA was designed to give states more control over tax dollars.

“Congressman Shimkus believes that states and local school districts, in addition to being capable, are in fact better positioned to direct taxpayer dollars to the groups and programs that need those limited resources the most,” the response read.

In another email responding to a follow-up question, Shimkus said the recent actions by the White House and the House of Representatives are aimed at getting Medicaid back to its original purpose. 

"The Medicaid program was established to provide a health care safety net for low income individuals and families. But today, waivers allow Medicaid funds to be used for education, bussing and non-health care related items. These departures from Medicaid’s primary purpose are part of the reason the program now faces insolvency, and why Congress and the Trump Administration are working to put this important safety net on a more sustainable path," he said in the email.

Shimkus said education bills and the regular budget process is the proper way to fund special education. 

Shimkus also said Congress has provided the tools necessary to comply with federal mandates. He cited the Every Student Succeeds Act signed into law Dec. 10, 2015, by President Barack Obama as an example. He said this, "not only ended No Child Left Behind, but also included a multi-billion dollar block grant program to give states more flexibility in how they use their share of federal education spending."

Gary Kelly, superintendent of Du Quoin Community Unit School District 300, said he was familiar with ESSA but was dubious. He said he never saw the promised extra funding through the No Child Left Behind Act and the current budget being proposed by the White House does not reflect an increase in education funding. He said educators have to react to what is in front of them, being proposed by Washington.

Both the proposed FY18 budget and the AHCA have vocal opposition in the U.S. Senate, a key player in each being made law.

“It’s often said that the president’s budget reflects our values, and this budget shows that President Trump clearly values tax cuts for the upper-income individuals in America over the lives of poor and middle class Americans,” U.S. Sen. Dick Durbin, D-Illinois, said of Trump’s budget proposal during a speech Tuesday on the Senate floor.

Kelly, who serves on the executive committee of the American Association of School Administrators, said as a group, the AASA has done its best to reach out to congressional leaders on the issue of Medicaid cuts.

“We’ve taken a strong stance on trying to educate people in the House of Representatives and also our U.S. senators about the impact that it has,” Kelly said, adding that concern over Medicaid cuts and how it could affect schools is a conversation being had not just in Illinois, but throughout all 50 states.

Making up the difference

Seeing a cut in Medicaid funding would mean schools in Southern Illinois would have to come up with the money somewhere else. Pearcy said for the three counties she serves, it means the districts make up the difference because there’s no room to cut in in the Tri-County budget — Medicaid billing accounts for $1.8 million of the co-op’s $12.5 million budget.

“We are at bare bones," she said. "We have cut everything we can cut."

Glenn said the amount Tri-County and schools like it receive from Medicaid is small when compared to the overall Medicaid budget. But they're huge to each individual school.

Glenn and Pearcy said there may be some validity to restructuring Medicaid. Neither denied that there may be some who abuse the system, but Pearcy said schools are not one of them.

“I think some people might have an idea that Medicaid is being abused, and I’m sure there are some abuses in different areas, but I certainly don’t think special ed is an area that is abusing Medicaid at all,” she said.

Kelly said a reduction of Medicaid funding would put pressure on the school districts to fund these required services, which rural school districts are largely not prepared to do. He said this means two options — cutting general education programs or falling out of compliance with federal law by not providing special education services.

The financial burden, Kelly said, would be devastating when coupled with other reductions in funding local schools have seen in recent years.

“We’ve been somewhat devastated and demeaned by what we’ve had to deal with for the last several years with funding at the state level and federal level,” Kelly said.

Glenn believes it could be a serious blow to Southern Illinois. She said if schools are forced to come up with the difference in Medicaid cuts, it could ruin some districts, forcing massive reductions and layoffs in education, one of the region's largest employers.

“It will be as bad as when the coal mines shut down,” Glenn said.

Pearcy said if she had time to talk with lawmakers in Washington, she would ask them to do one thing.

“Come see what we do," she said. "Come spend a day or two with us and just see the benefits of what Medicaid money can do for a child."


On Twitter: @ismithreports



Isaac Smith is a reporter covering Franklin and Williamson counties.

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