Education
BY ELLE BENT & CHLOE YOUNG
Texas school districts received unwelcome news in late 2023—they would lose about $300 million in Medicaid reimbursements for special education students through the state’s School Health and Related Services, or SHARS, program. SHARS allows school districts to be reimbursed for providing Medicaid health- related services to special education students. The reduction comes as the Texas Health and Human Services Commission lost an appeal to the ndings of a federal audit in October. The audit found the agency owed the federal government about $16 million it received for non-medical services. HHSC plans to repay the $16 million by recovering funds from districts and has made cuts to districts’ reimbursements. Districts lose $300M from special ed funds
The impact
nancially, with Austin ISD close behind, accord- ing to data provided by the HHSC. With a current budget de cit of $52 million for FY 2023-24, AISD will see a loss of $7.8 million promised in reimbursements, impacting over 10,000 special education students in the district, according to AISD documents.
The loss comes after districts have already budgeted for FY 2023-24 and are facing a $2 billion special education shortfall statewide, said Sylvia Wood, spokesperson for the Texas Association of School Boards. Northside ISD, Dallas ISD and Cypress-Fairbanks ISD are anticipating some of the largest setbacks
Diving in deeper
Estimated losses in school Medicaid funding
Some Central Texas school districts told Com- munity Impact they are seeing cuts beyond what HHSC has reported as a result of the audit. Lake Travis ISD will see a total reduction of $285,236 despite HHSC notifying the district of a $72,568 cut due to recoding some services, said Pam Sanchez, LTISD assistant superintendent for business services. Liberty Hill ISD will have to realign funds to cover some special education services as the district will receive $247,403 in reimbursements when it expected $1.1 million, Chief Financial O cer Rosanna Guerrero said. “The noti cations that HHSC sent in December were not full [and] were not complete of all the reductions they were making,” Guerrero said. Pete Pape, Leander ISD Chief Financial O cer, said the district was noti ed it owed HHSC $183,000 when it expected to receive $7 million—a decision the district has appealed. The district is now anticipating a $3.8 million de cit for the 2023-24 scal year mainly due to the funding loss.
The following reductions are HHSC estimates from Dec. 15. Many local districts anticipate larger losses.
Original 2022 estimates
Updated 2022 funding
Funding loss
Dripping Springs
$123,738
$381,106
Eanes
$1,148,727
Hutto
"It is never a good time to lose money, but this is really the worst possible time
$72,568
Lake Travis
to lose money and to lose money for services for special needs students." PETE PAPE, LEANDER ISD CHIEF FINANCIAL OFFICER
Leander
$559,344
Liberty Hill
Round Rock
$936,596
0 $1M $2M $3M $4M
SOURCE: TEXAS HEALTH AND HUMAN SERVICES COMMISSION COMMUNITY IMPACT THIS LIST IS NONCOMPREHENSIVE.
Special education students This shows the number of students who received special education services in area districts in 2022-23.
What’s next
“My hope is that we reduce the amount of loss,” Blanco said. “I think the longevity of [SHARS] is incredibly important to education and school nance in Texas.” Wood said TASB will continue to seek solutions, including legislative assistance, to improve the SHARS program so “school districts can spend more time serving [the] most vulnerable students and less time ... [navigating the] reimbursement system.”
Texas districts had until Jan. 31 to appeal the nal amounts they were noti ed of in December. HHSC expects to nish reviewing districts’ appeals by May, spokesperson Ti any Young said. Third-party billing company MSB School Services assisted almost all of the 460 districts it represents in submitting an appeal to HHSC, Chief Strategy O cer Emily Blanco said.
Eanes ISD: 836
Georgetown ISD: 2,035
Lake Travis ISD: 1,323
Leander ISD: 5,960
Round Rock ISD: 5,608
SOURCE: TEXAS EDUCATION AGENCY COMMUNITY IMPACT
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