Medicaid school-based services: what CMS’s 2023 guide says about PT, OT, and speech services
CMS’s 2023 guide for state Medicaid agencies and school districts says PT, OT, and speech, hearing, and language services in schools “must meet regulatory requirements at 42 C.F.R. § 440.110,” that their providers must meet that regulation’s federal qualifications, and that Medicaid may pay for covered services to Medicaid-enrolled students even when the services are not in an IEP. This page quotes the CMS guide only and copies no payment rates.
Quoted from official pages checked November 12, 2026. Confirm current information on those sites. This page is not medical, legal, or billing advice and does not describe any patient’s care.
Source read on November 12, 2026: CMS’s Delivering Services in School-Based Settings: A Comprehensive Guide to Medicaid Services and Administrative Claiming (2023, PDF). How your state carries this out is set in its Medicaid State plan; check your state Medicaid agency.
PT, OT, and speech services
CMS states: “PT, OT, and services for individuals with speech, hearing, and language disorders may be covered under multiple benefit categories but must meet regulatory requirements at 42 C.F.R. § 440.110.” And: “PT and OT must be prescribed by a physician or other licensed practitioner of the healing arts within the scope of his/her practice under State law and provided to a beneficiary by or under the direction of a qualified therapist.”
It adds: “Services like speech pathology services or PT, which support a student’s ability to learn, are an important component of Medicaid SBS.” Its example, paraphrased here because it runs across a page break in the PDF: PT in schools may help a student move around the school, take part in class activities, change positions, and manage stairs, restrooms, and the cafeteria.
Provider qualifications
CMS states: “While States generally have a great deal of flexibility to set provider qualifications for Medicaid services, provider qualifications for some Medicaid services are defined in federal law.” And: “For example, providers of PT, OT, speech therapy, and audiology services must meet federal provider requirements specified at 42 C.F.R. § 440.110, regardless of the section 1905(a) benefit category under which these services are covered.” It adds: “States can cover these services in Medicaid only if the providers meet the criteria in the federal regulations.”
Services beyond the IEP (“free care”)
The guide’s points to consider include: “Medicaid-covered services may be delivered to all Medicaid-enrolled students in school settings, and not just those with an IEP or Section 504 plan.” And: “Medicaid-covered services in a student’s IEP must be delivered at no cost to the child’s family, and Medicaid is the payer of first resort.” It also says Medicaid “is not the payer of first resort for services included only in a student’s Section 504 plan”.
CMS states: “Schools may seek payment for all Medicaid-covered services provided to children enrolled in Medicaid, regardless of whether the services are provided at no cost to other students.” The guide explains that CMS withdrew its older “free care” policy in 2014 through State Medicaid Director Letter #14-006, and that states whose plans tie school coverage to an IEP would need to amend their State plans to cover more.
Telehealth
CMS states: “State Medicaid/CHIP agencies have the flexibility to cover Medicaid- and CHIP-covered services delivered through telehealth, including in school-based settings.” And: “In order for a medical service performed to be payable, the provider furnishing such services must be enrolled in the Medicaid or CHIP program and bill Medicaid or CHIP for the service.”
What this page does not do
It does not describe any state’s plan, billing codes, payment methods, time studies, or administrative claiming, and it copies no rates. It is not legal or billing advice. Related federal rules are on Medicaid EPSDT, IEPs and IFSPs, and Section 504 plans.