Medicaid in Education

Public schools may receive Medicaid funds for some health services provided to students at school. The services must be medically necessary and the student must be enrolled in N.C. Medicaid. In North Carolina, the following services may be reimbursed in schools:

  • Audiology
  • Nursing services
  • Occupational therapy
  • Physical therapy
  • Psychological/counseling services
  • Speech-language pathology services


DHB Medicaid LEA Policy Telehealth Update

IDEA Parental Consent Final Regulations (sample notice and consent form to follow)


Lauren Holahan, Coordinator for Medicaid

Laurie Ray, Medicaid Consultant 

Bill Hussey, Medicaid Consultant for general education reimbursement/future planning (Tu & Wed only)

EPSDT Policy Instructions Update
On August 17, 2007, the Division posted the Early and Periodic Screening, Diagnostic, and Treatment (EPSDT) Policy Instructions Update. These instructions became effective September 01, 2007, and clarify the Division’s initial EPSDT Policy Instructions issued January 28, 2005. Please review the instructions carefully. Providers and case managers should communicate the information contained in the instructions to recipients under 21 years of age and/or their representatives. Children who have previously been denied or terminated from services may be eligible for additional Medicaid services if the services are medically necessary and if a request for services is made in accordance with Medicaid’s policies and procedures. The EPSDT Policy Instructions Update is located on the following website:

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Medicaid Policy and Resources

Information for Parents and Families

Guidance Documents



DHB Contacts

Policy - John Vitiello, PT, MCP - or 919.527.7653

Post Payment Review Pending

Cost Report

Beginning with cost reporting periods ending on or after June 30, 2008, the DHB will begin using a cost-based methodology for all Local Educational Agencies (LEAs).

  • Cost-based methodology will consist of a cost report, time study and reconciliation.
  • If payments exceed Medicaid-allowable costs, the provider will remit the federal share of the overpayment at the time the cost report is submitted; and
  • If the actual, certified costs of an LEA provider exceed the interim payments, the DHB will pay the federal share of the difference to the provider in accordance with the final actual certification agreement and submit claims to the Centers for Medicare and Medicaid Services (CMS) for reimbursement of that payment in the federal fiscal quarter following payment to the provider

Cost Report Documents

Medicaid Administrative Claiming (MAC) and Random Moment Time Study (RMTS)

  • The Centers for Medicare and Medicaid Services (CMS) have approved North Carolina’s School-Based Random Moment Time Study (RMTS) methodology, which was implemented October 1, 2007.
  • Participation in the School-Based Random Moment Time Study is required for LEAs to be reimbursed for both the Medicaid Administrative Claiming and Direct Service/Fee for Service Programs.
  • LEAs are required to reach an 85% return response rate per district per quarter.
  • If an individual district has non-returns greater than 15% and greater than five moments for a quarter, the LEA is in default and will receive a warning letter.
  • If the same LEA is in default (as previously defined) the next quarter, after being warned, the LEA will not be able to participate in the time study for a one-year period of time.
  • Based on approval of the time study, the State agrees to monitor the time study to assure proper use of the time study codes and proper application of the methodology.
  • The State agrees to provide summary reports to the CMS Regional Office detailing the results, issues and concerns identified in the monitoring process on a quarterly basis.
  • The State agrees to provide oversight of outside entity contracted to operate or monitor the time study process.
  • Time StudyMAC document (NOTE:: From 2007)
  • LEA Audit File Checklist MAC (NOTE:: From 2007)


Psychological and Counseling Services

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EPSDT Program

Medicaid covers a broad array of health and dental services for recipients under age 21. Early Periodic Screening, Diagnostic and Treatment (EPSDT) is known in North Carolina as Health Check and is defined by federal law. EPSDT/Health Check are important because it:

  1. Provides early and regular medical and dental screenings for all Medicaid recipients under age 21.
  2. Is a part of the federal Medicaid EPSDT requirement that provides recipients with medically necessary health care to correct or ameliorate a defect, physical or mental illness or a condition identified through a screening examination.

EPSDT/Health Check includes periodic screening, vision, dental and hearing services. In addition, section 1905(a) of the Social Security Act requires that any medically necessary health care service listed in section 1905(a) be provided to a Medicaid recipient under age 21 even if the service is not available under the State’s Medicaid plan. EPSDT may also cover some services that are not covered for recipients aged 21 and older. Health Check examinations and other Medicaid covered services are free of charge to the recipient.

All requests for services must be made in conjunction with the recipient’s physician or other licensed clinician and in accordance with the Division of Medical Assistance’s published procedures. If approval of a request is denied or services are reduced or terminated, the recipient or his/her representative will receive written notification. Additionally, the notice will contain information about how the decision may be appealed.

For additional information about Health Check and EPSDT, visit the address below: