Permanent Carve-Out of School-Based Health Centers Will Provide Sustainability to a Critical Health Care Safety Net for New York’s Most Vulnerable Kids and Teens

By New York School-Based Health Alliance | June 29, 2023

Health care providers, hospitals, and school-based organizations are urging Governor Hochul to sign S2339, Rivera/A6029, Paulin to provide stability to school-based health centers and the vital health services they provide throughout the State

State legislators and hospital and community health and education providers are hailing the NYS Legislature’s passage of S2339, Rivera/A6029, Paulin, which would permanently allow school-based health centers to remain “carved-out” of Medicaid Managed Care (MMC). This marks the third time this legislation has passed unanimously by both the Senate and Assembly in recognition of the immense value of the school-based health center (SBHC) model in meeting the health care needs of kids.

School-based health centers provide comprehensive physical, chronic, mental, and dental health services to over 230,000 underserved youth in rural, urban, and suburban areas of the State, regardless of insurance status or ability to pay. SBHCs are a proven model for increasing access to health and mental health services, reducing ethnic and racial disparities in the communities they serve, and improving school attendance and performance. These essential, safety net services will be placed in jeopardy if the State shifts to having managed care plans administer school-based health center coverage under Medicaid.

SBHCs have been “carved-out” of MMC since their inception. SBHCs were initially scheduled to be transitioned into MMC in 2014. The carve-in date has been extended six times since then, most recently in February 2023, postponing the carve-in date to no sooner than April 1, 2024. Despite a decade of implementation discussions between the School-Based Health Alliance, the Department of Health (NYS DOH), and various stakeholders including managed care organizations, no solutions have been identified to address the unresolvable issues that would pose significant administrative and financial burdens on SBHCs.

In 2021 and 2022 Governor Hochul vetoed prior versions of this legislation, stating that this proposal must be discussed within the context of the budget. This year, another budget cycle came and went, with no meaningful resolution achieved to address the outstanding issues that would threaten the existence of SBHCs under MMC.

Transitioning SBHCs from fee-for-service to MMC will increase costs when SBHCs have already suffered over $7 million in funding cuts since 2008, while their patient population has continued to grow. It is not feasible for New York State SBHCs to transition into MMC.

The SFY 2024 final budget included a 10% or $1.4 million Medicaid rate increase for school-based health centers. This was greatly welcomed but does not address the historical cuts borne by SBHCs, nor will it avert the financial crisis that a carve-in would cause.

The MMC model in NYS has created insurmountable barriers to accessing health care for other sectors including behavioral health and home care. Persistent plan denials, delays and red tape dictate whether patients can receive necessary care and only adds costs to the system –in the timeliness of care impacting outcomes, in reimbursement and in paying “middlemen” to administer coverage for services. SBHCs and their sponsoring organizations can ill afford the initial transitions costs, nor ongoing delays and denials that have decimated provider populations in other sectors.

Together, we urge Governor Hochul to sign this critical bill into law to protect and bring stability to SBHCs and the children who depend on their essential services.  This legislation ends the years of uncertainty, and enables SBHCs and their partners to direct all resources toward ensuring the stability of this vital, child-centered public health service.

“School based health centers play a critical role in making healthcare accessible to children in some of our State’s most medically underserved communities. I urge Governor Hochul to finally sign this bill to ensure the financial viability of these centers so that these children can remain healthy and better perform in school while reducing the ongoing health disparities facing our State,” said Senate Health Committee Chair Gustavo Rivera.

“School-based healthcare is an effective way to achieve health equity among children,” said Assembly Health Committee Chair Amy Paulin. “If we place critically needed services like medical, behavioral, dental, and vision care directly in schools, more young people, regardless of their means, will have access to these essential services. I thank State Senator Rivera for his advocacy and partnership achieving the passage of our bill permanently allowing school-based health centers to remain carved-out of Medicaid Managed Care and urge Governor Hochul to sign this important bill into law.”

“While we have heard in the past that MMC is needed to ensure care coordination and the potential for value-based payment (VBP) arrangements, we strongly disagree,” said Sarah Murphy, Executive Director for the New York School-Based Health Alliance. “There is strong care coordination today with the existing model and we are glad to work with the state and other stakeholders to further enhance it.  VBP arrangements can be made with plans through SBHC sponsoring organizations, and are certainly not a reason to dismantle the current system, threatening the viability and future of SBHCs and the critical services they provide.  Governor Hochul, please stand up for New York children and sign this bill into law.”

“Greater New York Hospital Association (GNYHA) strongly supports this important bill,” said GNYHA Vice President of Government Affairs Andrew Title. “Our member hospitals sponsor school-based health centers that provide primary, mental, and dental health care for over 100,000 children in the Bronx, Brooklyn, Queens, Manhattan, Staten Island, Buffalo, Yonkers, and Rochester. Mandatory managed care participation would impose a costly administrative burden on these critical safety net clinics, with no benefit for the at-risk children they serve. We urge Governor Hochul to sign A.6029/S.2339 into law.”

“The carve-out of school-based health centers from Medicaid managed care will ensure SBHCs can continue focusing on what they do best – providing comprehensive and much-needed healthcare services to children and adolescents in high-risk areas all across New York,” said Healthcare Association of New York State President Bea Grause, RN, JD. “Importantly, this measure will help prevent the addition of new administrative burdens and costs that would come with a transition to managed care. We encourage the governor to make this important carve-out permanent to protect underserved students’ access to quality healthcare services at school.”

“The Medicaid carve out is the lifeline for School Based Healthcare Centers across NYS.  It allows School Based Healthcare Centers to provide safety net healthcare to the poorest children in the state, so the children they serve can receive care, remain in school and learn.  It is crucial that Governor Hochul signs this bill,” said Kim Utech, 1199SEIU Delegate & Nurse Practitioner at Oishei Children’s Hospital in Buffalo.

The organizations listed below strongly support the permanent carve-out of School-Based Health Centers (SBHCs) from Medicaid Managed Care (MMC) and urge Governor Hochul to sign A.6029/S.2339 into law.

New York School-Based Health Alliance

1199SEIU United Healthcare Workers East

Bassett Healthcare Network

Children’s Aid

Greater New York Hospital Association

Healthcare Association of NYS (HANYS)

Institute for Family Health

Kaleida Health

League of Women Voters of New York State

North Country Family Health Centers

New York State United Teachers

New York School-Based Health Foundation

Northwell Health

NYS Community Schools Network

NYS Network for Youth Success

NYU Langone Family Health Centers

Open Door Family Medical Centers

Rural Schools Association of NYS

Smile NY Outreach

United Community Schools | United Federation of Teachers

Urban Health Plan


*sponsored content*