Denise & Lisa contributed the following article to the New Jersey Lawyer Magazine's December 2013 (No. 285) School Law Edition:
Children with disabilities often have significant needs for services and therapies. Most practitioners turn to school districts to provide and fund the necessary services. While under state and federal law school districts do have the responsibility to provide appropriate educational services, other funding sources are available and should be considered in special education cases. Additional funding sources include health insurance, the New Jersey Early Intervention System and New Jersey’s Children’s System of Care.
The Individuals with Disabilities in Education Act
Children with disabilities from birth through age twenty-one are entitled by law to services and supports that are individually designed to meet their unique needs . The Individuals with Disabilities in Education Act (“IDEA”) and its implementing federal regulations , in conjunction with New Jersey state regulations, govern the delivery of specialized services to disabled children. The law defines a “disabled child” as a child with a developmental, cognitive, emotional, physical, or learning disability.
Part C of IDEA requires states to provide early intervention services to disabled children from birth to age three prior to their entry into the public school system. The role and responsibilities of the New Jersey Early Intervention System (“NJEIS”), codified in N.J.A.C. 8:17, provides for a statewide system in which services are provided to children with developmental delays and disabilities. Services provided by NJEIS can be developmental interventions for autism such as applied behavior analysis (“ABA”) as well as discipline specific therapies such as speech, occupational or physical therapy. NJEIS requires a parental contribution, or cost share, determined on a sliding scale based on each family’s income and size. The early intervention services that a child receives are documented in an Individualized Family Service Plan (“IFSP”), akin to the Individualized Education Plan (“IEP”) that a school age child receives.
For individuals with disabilities age three to twenty-one, IDEA requires that local school districts provide students residing within their districts with a free appropriate public education (“FAPE”). Pursuant to the FAPE provision of the IDEA school districts are required to provide disabled children with special education and related services that meet their individualized needs. These services may include but are not limited to out-of-district private school placements, home based services and, in some cases, residential placements. Services must be provided at no cost to the child’s parent or guardian. It is legally impermissible for a school district to withhold an appropriate service due to cost. Under IDEA, services must be provided to meet the child’s needs regardless of budgetary concerns or convenience. In practice, however, the costs of placements and services which can easily run in excess of $100,000.00 a year often play a role in special education cases.
While private insurance coverage and other state funding may exist, a school district cannot require a parent to seek any alternative sources of funding. However, accessing alternative sources of funding, when available, should be considered and investigated in matters involving services for children with disabilities. First and foremost, accessing alternative sources of funding may result in more robust services for a disabled child since school districts are not required to optimize a child’s progress but only to deliver services that provide meaningful progress. Moreover, bringing multiple funders “to the table” may assist in resolving disputes over services and programs more expeditiously and economically.
The 2009 New Jersey Autism Insurance Reform Law
On August 13, 2009 Governor Jon Corzine signed into law The New Jersey Autism Insurance Reform Law, Public Law 2009, Chapter 115 (the “Autism Mandate”). On February 9, 2010, the Autism Mandate went into effect. Pursuant to the law, New Jersey regulated insurance plans and plans covering teachers and employees of state and local governments are required to cover the diagnosis of autism and autism-related therapies such as ABA therapy for autistic children who are under the age of twenty-one. Additionally, the Autism Mandate requires insurers to fund medically necessary therapies for autistic children such as speech therapy, occupational therapy and physical therapy. Under the Autism Mandate, insurers are not required to pay for ABA therapy for developmentally disabled children who do not have a diagnosis of autism.
The Autism Mandate also allows families to receive reimbursements for their family cost share portion of expenses that they have incurred for certain services obtained in their IFSP through NJEIS. Though the statute specifically states a $36,000 limit into insurance policies for ABA therapy, the New Jersey Department of Banking and Insurance has interpreted the federal Mental Health Parity Act to preclude most large and small group insurers from enforcing this limit. Pursuant to the Autism Mandate, insurance carriers are only required to cover medically necessary services. A treatment plan, prepared by a physician or other medical professional such as a licensed psychologist, is required. The treatment service plan is subject to review and revision by the insurance company every six months.
While the benefits provided under the Autism Mandate are substantial, not all insurance policies are subject to its requirements. Specifically, coverage provided under self-funded insurance plans is not governed by the terms of the Law. However, while self-funded plans are not subject to the Autism Mandate, some plans do voluntarily provide coverage for ABA services. In addition, coverage may be available under some self-funded plans that have broad mental health provisions and contain no clear exclusion barring coverage for ABA therapy. It is, therefore, essential to review a client’s policy in order to determine the scope of coverage.
Health Insurance Coverage
Therapies such as physical therapy, occupational therapy, speech therapy and mental health services may be covered by a family’s health insurance plan for children with or without a diagnosis of autism. In certain situations, parents and school districts may disagree about the level of these “related services” provided to a child in the child’s IEP. In such cases, parents may choose to file for Mediation/Due Process under the IDEA to resolve the dispute. However, if parents can obtain these therapies through their health insurance benefits they may choose not to litigate the issue, thereby saving the time and expense of litigation. Lifetime limits, co-payments and deductibles must be investigated before parents agree to access health insurance benefits in lieu of receiving increased services from the school district. Additionally, the time and energy that may be required to procure insurance benefits should be carefully considered before deciding to not pursue full services from a school district.
The New Jersey Children’s System of Care
The Children’s System of Care (“CSOC”), a division of the New Jersey Department of Children and Families (“DCF”) may be a source of funding for residential placements and in-home services for children with mental health, behavioral and developmental disabilities. Residential placement issues are often litigated especially when a child’s inappropriate behavior in the home is more extreme than at school. Seeking residential placement from CSOC is a course of action that should be considered in cases where children exhibit dangerous or maladaptive behaviors. Placement through CSOC may avoid lengthy and costly litigation with a school district over whether the child can be served in a day placement as opposed to a residential placement. The clinical criteria utilized by CSOC in determining whether to offer residential services to a child differs from the legal standard required under IDEA. CSOC is concerned with the child and his/her family being safely and appropriately maintained at home and in the community. Under IDEA, school districts are required to pay for a residential placement if it is established that a child is unable to achieve meaningful educational benefit without residential services.
CSOC services may be provided when a child or his/her family is at risk in the home or community. Children with severe behaviors that require intensive in-home supports or residential placements may be eligible to receive services from CSOC in addition to the services provided by their local school district. An example of a case where assistance from CSOC may be sought is when a child is aggressive at home and in the community but is making progress in his/her school placement. The parents may request that their child be evaluated by CSOC. If it is determined that the child requires a residential placement, he/she may be placed in a New Jersey residential facility that is funded by CSOC. When CSOC places the child in a residential placement, the school district where the parents reside remains obligated to fund the educational portion of the placement even if the child’s residential placement and school are within another district.
It must be noted that if parents choose not to pursue services from CSOC, their school district cannot compel them to do so. In addition, School Districts do not have a private right of action under the IDEA and thus cannot pursue a claim for contribution or reimbursement from CSOC or compel CSOC to residentially place a child. Administrative Law Judges do not have jurisdiction over CSOC in a due process hearing and thus cannot order CSOC to pay the residential costs of a child’s placement.
The IDEA mandates that school districts provide children with disabilities free appropriate services that meet their individual needs. However, there exist other funding sources that may be accessed to provide additional services and supports. Tapping into these additional funding sources may resolve disputes between parents and school districts as well as provide enhanced services for children with disabilities.