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Introduced by   Representative LaVoie of Swanton

Referred to Committee on


Subject:  Education; Medicaid receipts

Statement of purpose:  This bill proposes to have Medicaid reimbursements paid to schools instead of supervisory unions and remove provisions in law regarding use of the reimbursed funds.


It is hereby enacted by the General Assembly of the State of Vermont:

Sec. 1.  16 V.S.A. § 2959a is amended to read:


(a)  It is the intent of the general assembly that the state of Vermont shall maximize its receipt of federal Medicaid dollars available for reimbursement of medically-related services provided to students who are Medicaid eligible.  It is further the intent that:

(1)  Each supervisory union school district identify special education and other students eligible for Medicaid reimbursement and, to the extent possible, submit Medicaid bills for services reimbursement.

(2)  The department of education and the agency of human services work with local school districts to maximize reimbursements including services to non-IEP students.

(b)  A Medicaid reimbursement administrative special fund is established within the department of education.  Eleven percent of the Medicaid reimbursement funds shall be deposited into the fund.  The funds shall be used for agency of human services and department of education administrative costs related to the collection, processing and reporting of education Medicaid reimbursements and statewide programs identified and approved by the commissioner of education with the advice of the secretary of human services.  The commissioner shall expend monies from the fund only as appropriated by the general assembly.

(c)  At least annually, the commissioner of education shall pay to each supervisory union school district submitting Medicaid bills under this section, 50 percent of the reimbursed funds generated by the supervisory union’s school district’s bill, excluding claims generated by state-placed students. Unless the supervisory union has agreed to use the funds to operate a supervisory unionwide program or to distribute the funds in a different manner, upon receipt, the supervisory union shall distribute the funds to its member school districts based on how the funds were generated.  The commissioner of education may withhold payment due a school district pursuant to section 2950 of Title 16 this title for a Medicaid-eligible state-placed student if the school district has not submitted a Medicaid claim for reimbursable services for that student.

(d)  If the amount of Medicaid reimbursement funds received for services provided in the prior state fiscal year exceeds $25,000,000 $10,000.00, in addition to the 50 percent of said funds paid to supervisory unions school districts submitting Medicaid bills, 25 percent of the amounts in excess of the $25,000,000 $10,000.00 shall be paid into an incentive fund hereby created in the department of education.  These funds shall be used for an incentive payment to supervisory unions school districts with student participation rates of over 80 percent in accordance with a formula to be developed by the department of education, in consultation with the Vermont Superintendents Association.

(e)  School districts shall utilize funds received under this section to pay for reasonable costs of administering the Medicaid claims process, and for prevention and intervention programs in grades pre-K through 12.  The programs shall be designed to ensure all students achieve rigorous and challenging standards adopted in the Vermont framework of standards and learning opportunities or locally adopted standards. A school district shall provide an annual written justification to the commissioner of education of the use of the funds.  Such annual submission shall show how the funds’ use is expressly linked to those provisions of the school district’s action plan that directly relate to improving student performance.

(f)  Remaining reimbursed funds shall be deposited into the education fund.

Published by:

The Vermont General Assembly
115 State Street
Montpelier, Vermont