IDEA Related Services Letter (Revised)

Dear County and District Superintendents, Special Education Local Plan Area Directors, Special Education Administrators at County Offices of Education, Charter School Administrators, Principals, and Nonpublic School Directors:

ASSEMBLY BILL 114: INDIVIDUALS WITH DISABILITIES EDUCATION ACT AND THE USE OF INSURANCE FOR RELATED SERVICES — REVISED

Assembly Bill (AB) 114, Chapter 43, Statutes of 2011, made significant changes to Chapter 26.5 of the California Government Code (GC) regarding the provision of mental health services to students with disabilities. As a result of AB 114, local educational agencies (LEAs) are responsible for ensuring the provision of special education and related services which were previously provided by county mental health agencies (CMHAs) under Chapter 26.5 of the GC. As LEAs implement this transition, and as a result of changes in state statute stemming from AB 114, the Individuals with Disabilities Education Act (IDEA) serves as the statutory framework for the provision of related services. This transition of responsibility to districts has generated questions regarding the possibility of accessing parents' health insurance benefits to pay for related services formerly provided by CMHAs.

This document is intended to assist LEAs in understanding requirements related to the use of public benefits and insurance, and private insurance, to support the costs of providing services to students with disabilities.

Some financial assistance in paying for certain health care-related services may be available from insurance sources (see also Education Code 56363.5 ¹). Title 34 of the Code of Federal Regulations (CFR) section 300.154 provides guidelines describing when LEAs may access a student's public benefits or insurance, or their parents' private insurance. This section of Title 34 of the CFR was recently amended, and the changes will become effective on March 18, 2013. It is important to note that the changes only apply to the requirements for accessing public benefits and insurance. The requirements for accessing a student’s or their parent's private insurance have remained unchanged.

Access to Public Benefits and Insurance

As a public agency, an LEA may access parents' public benefits or insurance to pay for related services required under Part B of the IDEA, for a free appropriate public education (FAPE). For related services required to provide FAPE to an eligible student, the LEA:

• May not require parents to sign up for or enroll in public benefits or insurance programs (Medi-Cal) in order for their child to receive FAPE under Part B of the IDEA (34 CFR 300.154 [d][2][i])
• May not require parents to incur an out-of-pocket expense such as the payment of a deductible or co-pay amount incurred in filing a claim for services and reimbursement through Medi-Cal (34 CFR 300.154[d][2][ii])
• May not use a student's benefits under Medi-Cal if that use would:
• Decrease available lifetime coverage or any other insured benefit
• Result in the family paying for services that would otherwise be covered by the public benefits or insurance program (Medi-Cal) and are required for the child outside of the time the child is in school
• Increase premiums or lead to the discontinuation of public benefits or insurance (Medi-Cal)
• Risk loss of eligibility for home and community-based waivers, based on aggregate health related expenditures (34 CFR 300.154[d][2][iii][A – D])

Amended Consent Requirement – 34 CFR 300.154(d)(2)(i – iv) (Effective March 18, 2013)

Prior to accessing a student's or their parent's public benefits or insurance (Medi-Cal) for the first time, the LEA must obtain written parental consent (34 CFR 300.154[d][2][v]). The parent's written consent must:

• Meet the requirements of 34 CFR 99.30 and 34 CFR 300.622, which specifies the personally identifiable information that may be disclosed (e.g., records or information about the related services that may be provided to a particular student)
• State the purpose for the disclosure (e.g., Medi-Cal billing)
• State the agency to which the disclosure may be made
• State that the parent understands and agrees that the LEA may access the student's or parent's public benefits (Medi-Cal) or insurance to pay for related services. (34 CFR 300.154[d][2][iv][A-B])

The amended consent requirements alleviates the LEAs need to obtain consent each time access to Medi-Cal is sought.

Written Notification Requirement - 34 CFR 300.154(v)(A – D) (Effective March 18, 2013)

Prior to accessing a student's public benefits or insurance for the first time, and annually thereafter, the LEA must provide the student's parents or guardians with written notification consistent with 34 CFR 300.503(c). The notification shall include:

• A statement of the parental consent provisions in 34 CFR 300.154(d)(2)(iv)(A–B) (see 34 CFR 300.154[d][2][v][A]);
• A statement of the "no cost" provisions of 34 CFR 300.154(d)(2)(i) – (iii) (see 34 CFR 300.154[d][2][v][B])
• A statement that the parents have the right under 34 CFR part 99 and part 300 to withdraw their consent to the disclosure of their student's personally identifiable information to the agency responsible for the administration of Medi-Cal (county mental health plan, or CMHP) at any time (34 CFR 300.154[d][2][v][C])
• A statement that the withdrawal of consent or refusal to provide consent under 34 CFR part 99 and 300 to disclose personally identifiable information to the agency (CMHP) responsible for the administration of Medi-Cal does not relieve the public agency (LEA) of its responsibility to ensure that all required services (under IDEA) are provided at no cost to the parents (34 CFR 300.154[d][2][v][D])
• The notification must be written in language understandable to the general public and in the native language of the parent or other mode of communication used by the parent, unless it is clearly not feasible to do so (34 CFR 300.503[c]).
  

Accessing Private Insurance

California Education Code (EC) Section 56363.5 allows an LEA to seek reimbursement for related services provided through an IEP from a student's parents' or guardians' insurance company. The following requirements must be met by the LEA prior to accessing private insurance benefits:

• Each time a public agency proposes to access the parents' private insurance proceeds, an LEA must obtain written parental consent in accordance with 34 CFR 300.9 (34 CFR 300.154[e][1 and 2]).
• Inform the parents that their refusal to permit the LEA access to their private insurance does not relieve the LEA of its responsibility to ensure that all required services are provided at no cost to the parents (34 CFR 300.154[e][2][ii]).
  

While these regulations do not address specifically what information must be disclosed to parents, an LEA could consider disclosing the following consequences to the use of private insurance benefits to provide related services required for FAPE under Part B of the IDEA:

• Incurring out-of-pocket expenses (e.g. co-payments)
• A decrease in available lifetime benefits coverage or decrease in any other policy benefit
• An increase in premiums
• Cancellation or non-renewal of coverage
• Decreased ability or inability to obtain alternate acceptable coverage

To avoid financial cost to parents who otherwise would consent to use private insurance if the parents incur a cost, the LEA may pay the cost that the parent would otherwise have to pay to use their private insurance (e.g., deductible or co-pay amounts [34 CFR 300.154[f][2]).

If an LEA is unable to obtain parental consent for the use of a parent's private insurance for a related service required to ensure FAPE, the LEA must provide for this service (34 CFR 300.154 [f][1]).

If you have any general questions regarding this subject, please contact the Special Education Division by email at AB114TWG@cde.ca.gov.

Sincerely,

Original signed by Fred Balcom. Hard copy of the signed document is available by contacting the Special Education Division's Director's Office at 916-445-4602.

Fred Balcom, Director
Special Education Division

FB:rb

Footnotes

¹ EC 56363.5 currently does not reflect changes made to 34 CFR 300.154(d)