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AB 516

Revises provisions relating to Medicaid coverage for certain health services provided to children at schools. (BDR 38-348)

2025 Regular Session

Expands Medicaid billing for school-based health services, offers incentives to clinics serving students, and funds a School Health Access Center to help providers enroll and bill.

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Bill Summary · AB 516

AB 516 — Summary (BDR 38-348)

Revises provisions relating to Medicaid coverage for certain health services provided to children at schools.

Purpose / Intent

To increase access to Medicaid‑covered health services for children enrolled in public schools by (1) ensuring local educational agencies (LEAs) and the Department of Education can receive Medicaid reimbursement for services delivered on school premises, (2) incentivizing community providers to contract with schools, (3) simplifying school‑based Medicaid billing, and (4) creating state support to help providers participate in Medicaid.

Key provisions

  • Requires the Director of the Department of Health and Human Services (DHHS) to take actions necessary so LEAs and the Department of Education can receive Medicaid reimbursement for health services provided on school premises to children who are Medicaid recipients.
  • Directs DHHS to establish incentive payments that increase effective Medicaid reimbursement to certified community behavioral health clinics (CCBHCs) or federally qualified health centers (FQHCs) that contract with an LEA or the Department of Education to serve Medicaid‑enrolled public school children. Incentives may be delivered via higher rates or value‑based payment models.
  • Establishes the School Health Access Resource Center within the Division of Health Care Financing and Policy to:
    • Help Medicaid providers and entities that want to deliver services on school premises evaluate available participation/billing options (including provider type choices), and
    • Assist them in meeting enrollment, billing and procedural requirements.
    • The Division must fund and staff the Center (facilities, equipment, staff, supplies).
  • Requires the Director to apply for any federal waivers or State Plan amendments or other federal authority needed to implement the incentive program and to obtain federal funding to carry it out.
  • Requires application for federal authority to:
    • Increase reimbursement rates for services provided on school premises by LEA employees or contractors (and the Department of Education) by at least 5%; and
    • Simplify/streamline reimbursement methodology for primary care and preventive services delivered by school‑based health centers and increase those rates by at least 10%.
  • Conforming and administrative changes to place these duties within DHHS authorities.
  • Contains a state appropriation to fund operation of the School Health Access Resource Center (not included in the Executive Budget).

Who is affected

  • Positive/primary effects: Medicaid‑enrolled students receiving services at school; LEAs and the Department of Education (as potential billing entities/partners); school‑based health centers; CCBHCs; FQHCs; community providers that partner with schools.
  • Administrative impact: DHHS (Division of Health Care Financing and Policy) — for program design, federal applications, and operating the Resource Center; state budget (contains appropriation).

Procedural / timeline highlights

  • Introduced: Feb 10, 2025 (As introduced materials dated March 24, 2025 in some documents).
  • Committee amendments adopted (Amendment No. 452) replacing “school district/charter school” with the federally‑aligned term “local educational agency.”
  • Passed Assembly and Senate (votes recorded), enrolled Sept 9, 2025, presented to Governor Sept 9, 2025.
  • Approved by the Governor and chaptered as Chapter 371, Statutes of 2025 (Oct 6, 2025).
  • Implementation of rate increases and incentive payments requires federal approval (waivers/State Plan amendments); timing depends on federal authorization and state administrative roll‑out.

Expected impact (summary)

If federal approvals are obtained and state funding provided, the measure is intended to boost Medicaid revenue for school‑site services, encourage partnerships between schools and community providers, increase capacity to bill Medicaid for school‑based care, and expand access to primary, preventive and behavioral health care for Medicaid‑eligible students. It will require DHHS administrative work, federal approvals, and state resources to stand up the Resource Center and incentive programs.

Compiled from official sources — confirm details with the bill’s official record.

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