The foundation for the relationship between Medicaid and education was established by the Medicare Catastrophic Coverage Act (Public Law 100-360), as amended in 1988. Medicaid pays for costs of direct, medically necessary services provided to eligible children who have disabilities in accordance with the Individuals with Disabilities Education Act (IDEA). Illinois has actively supported this relationship since 1992, through the School-Based Health Services program (SBHS).
In Illinois, services that may be claimed for School-Based Health Services' Medicaid reimbursement are:

Audiology
Developmental assessments
Medical equipment
Medical services
Medical supplies
Nursing services
Occupational therapy
Physical therapy
Psychological services
School health aide
Social work
Speech/language pathology
Transportation

These services are frequently specified as necessary related services in individual education programs (IEP) developed by schools for children with disabilities. When these services are provided under a child's IEP, the services are eligible for federal Medicaid reimbursement, usually half of the established cost to provide the service.

Schools may also claim some costs for the administration of the program, in addition to direct medical services. Allowable administrative claims include outreach activities designed to ensure that the entire student community has access to Medicaid covered programs and services. Local Education Agencies (LEAs) may claim costs for specific administrative activities, as well as costs incurred for implementing and monitoring the Illinois state Medicaid plan.

Further information about the School-Based Health Services program is available by E-mail or by calling the SBHS office at 217-782-3953.