Hillsborough school staff brief board on Medicaid changes; finance to start internal rate study

Hillsborough County Public Schools staff told the school board at a board-requested Medicaid workshop that the district runs two distinct school-based Medicaid programs, faces pending federal guidance and state-level requirements that could change how districts are reimbursed, and that finance will begin an internal rate study next week to seek higher reimbursement rates.

The presentation, led by Chief Financial Officer Jamie Lewis and Medicaid specialist Deneen Grisani, described (1) the district's administrative claiming program, known as School District Administrative Claiming (SDAC) or random moment time sampling (RMTS); (2) the fee-for-service program for direct student services; (3) compliance issues tied to certification of public expenditures (CPE); and (4) planned district actions, including a rate study and stepped-up outreach with community partners to increase student enrollment in Medicaid and CHIP.

Why it matters: Federal guidance issued in May 2023 and related requirements must be implemented by July 1, 2026, according to the presentation. That guidance shifts the way school-based Medicaid may be paid in some cases from a historical fee schedule to reimbursement based on documented expenditures, a change that requires a state plan amendment (SPA) and additional state rulemaking. District staff said Florida's state agency had not yet submitted the SPA and that delay affects when Hillsborough and other Florida districts could receive higher, expenditure-based payments.

Lewis and Grisani described the two programs the district operates. Under SDAC/RMTS, roughly 3,000 to 3,500 employees are in the sample pool and about 80 to 90 staff are sampled each quarter; participants are asked three questions about who they were with, what they were doing and why. The district must meet a participation rate (currently 75%, rising to 85% in 2026) and the allowable response window is shrinking from seven days to two days under federal guidance. Grisani said staff members in sampled roles currently receive a notification on the morning of their sampled moment; that will change in 2026 to two days' notice.

The fee-for-service program reimburses clinicians and certified providers for documented services tied to treatment plans or IEPs; Grisani listed reimbursable categories including mental health counseling, nursing, evaluations, therapies (speech, OT, PT) and certain transportation trips when those rides are documented as part of student care. She also described credentialing and parental-consent requirements for billing.

On compliance and payments, Grisani told the board the district has been operating under a fee-schedule approach for some services and cited a federal review that found some states were using fee schedules in ways that conflict with the CPE rules. She said the federal guide requires states to implement cost-reporting and expenditure-based payment methods and that a SPA typically takes 15 to 18 months to approve. "We have to submit a SPA," Grisani said, noting the state of Florida had not done so "as of today's date."

Numbers discussed and district priorities: Grisani estimated the district has about 8,000 Medicaid-eligible students receiving services (she said that figure reflects ESE students currently receiving billed services). Lewis said the district brought in about $66 million last year from the programs that generate Medicaid revenue; district staff also said Department of Education analyses suggest very large districts could see differences on the order of about $10 million annually if state-level changes occur. Grisani said advocates estimate an "extra estimated $200,000,000 for Florida school districts" if state action and federal approvals proceed; she asked the board to press for a state SPA and to support an interagency agreement between the state Medicaid agency and the state Department of Education.

Board direction and next steps: Finance told the board it will begin an internal rate study and pursue adjustments for categories such as transportation and nursing that staff believe are under-reimbursed. At least one board member asked that the board be kept informed; Lewis said the rate study work would start next week. Staff also described scaling up outreach and enrollment through the district's memorandum of agreement with the Family Healthcare Foundation, community engagement through FACE (Family and Community Engagement) and partnerships with student-services teams and school front offices to reach families, including language-access materials and in-person enrollment at events.

Board members asked questions about potential impacts if state-level funding or eligibility changes reduce reimbursable populations; staff repeatedly stressed that services would continue for students regardless of reimbursement but that fewer eligible students or lower reimbursement would reduce the district's recovery of costs. Grisani and Lewis also outlined operational changes the district expects if the SPA and federal guide take effect: cost reports, two cost pools instead of one, and greater finance coordination to sustain the sampling and documentation required for reimbursement.

No formal vote was taken. Board members asked for periodic updates as the rate study and outreach work proceed.