MassHealth School-Based Medicaid Claiming: RMTS, DSC and AAC Services for Massachusetts Districts

For Massachusetts special education directors and school business managers, the MassHealth School-Based Medicaid Program is one of the most valuable and most misunderstood sources of funding a district has. The reimbursement is real, but capturing it means navigating program mechanics most district staff were never trained to manage: the Random Moment Time Study, Direct Service Claiming, and Administrative Activity Claiming. Getting these right is the difference between fully funding your district’s health services and leaving reimbursement unclaimed. Since 1993, New England Medical Billing (NEMB) has helped Massachusetts districts master exactly these mechanics.

How MassHealth Administers School-Based Medicaid in Massachusetts

The School-Based Medicaid Program in Massachusetts is directly administered by MassHealth, which oversees the program, develops new policies, and is responsible for ensuring compliance with all state and federal regulations. In cooperation with MassHealth, the University of Massachusetts Medical School oversees the program to ensure that program directives are carried out across the state. Any local education agency, or LEA, that wants to participate seeks reimbursement through MassHealth.

Districts claim reimbursement through two primary pathways: Direct Service Claiming and Administrative Activity Claiming. Understanding how each works, and how the Random Moment Time Study underpins both, is the foundation of a strong claiming program.

The Random Moment Time Study: The Engine Behind Your Reimbursement

The Random Moment Time Study, or RMTS, is the program that aids MassHealth in determining how educational staff members spend their time, and the results of this time study have a major impact on local education agency reimbursement. Any LEA seeking reimbursement through AAC or DSC must be included in an RMTS pool, so that MassHealth can gain an understanding of where time is being spent by staff members.

Here is how it works in practice. Throughout the school year, educators are queried about exactly what they were doing at a specific moment in time, and they are given two school days to respond to that query. All educators associated with an LEA seeking reimbursement through AAC or DSC must belong to one of the specified RMTS pools. The response rate on these moments matters enormously, because MassHealth requires a minimum 85% response rate from sampled staff for the study to remain valid. Fall below that threshold and your district’s reimbursement is at risk, which is why RMTS monitoring requires active attention all year long.

Direct Service Claiming and Administrative Activity Claiming

The two claiming pathways capture different kinds of reimbursable activity.

Direct Service Claiming, or DSC, covers billing for time spent directly delivering covered services to eligible students, such as speech therapy, occupational therapy, and other health related services. DSC reimbursement is only as strong as the documentation behind it, which is why clean, consistent service notes are essential.

Administrative Activity Claiming, or AAC, reimburses government agencies for allowable costs related to Medicaid administrative functions, such as referrals, care coordination, outreach, and helping students enroll in MassHealth. These expenditures are detailed quarterly under the administrative claim, and the RMTS results are combined with each provider’s costs and submitted in an annual cost report to determine the appropriate level of reimbursement for both DSC and AAC.

Together, RMTS, DSC, and AAC form a single connected system: the time study feeds the claiming, the claiming feeds the cost report, and the cost report determines the reimbursement. A weakness anywhere in that chain reduces what your district collects.

Program Expansion: Beyond the IEP

The claiming landscape has broadened. Through the effort known as Expansion, MassHealth broadened the School-Based Medicaid Program to include payment for medical services provided to students under plans beyond the IEP. In addition to services pursuant to an IEP, the expanded program now also covers services provided pursuant to an individual health care plan, a Section 504 plan, an individualized family service plan, and state mandated screenings. Expansion also made it possible to claim reimbursement for services offered by additional provider types, such as a dental hygienist, a nutritionist, a respiratory therapist, and a school psychologist. For districts, that means a larger universe of billable services, and more reimbursement available to those equipped to claim it.

How NEMB Supports Massachusetts Districts

Managing RMTS, DSC, and AAC on top of running a school district is a significant undertaking, and it is exactly what NEMB is built to handle. Through our school-based Medicaid billing services, we take on the administrative work of claiming, actively monitor RMTS participation for our district clients, track response rates, and flag at-risk staff before a quarter closes to help maintain the 85% threshold MassHealth requires. We provide regular eligibility reporting so districts know exactly which students are covered, and we support the documentation and cost reporting that DSC and AAC depend on, all while maintaining HIPAA and FERPA compliance.

We also make daily documentation easier. SimpleNote, our free proprietary software, simplifies the task of IEP service note taking for staff. It is 100% HIPAA and FERPA compliant, meets state and federal guidelines, and can be customized by state, which helps districts capture the clean documentation that strong DSC reimbursement requires.

Since 1993, NEMB has worked with Massachusetts schools to sharpen its approach to school-based Medicaid claiming, and that experience is authority we put to work for every district we serve.

Frequently Asked Questions

What is the difference between DSC and AAC?

Direct Service Claiming covers time spent directly delivering covered services to eligible students. Administrative Activity Claiming reimburses allowable costs related to Medicaid administrative functions such as referrals, care coordination, outreach, and helping students enroll in MassHealth. Both require the district to participate in the RMTS.

Why does the Random Moment Time Study matter so much?

The RMTS determines how much of your staff’s time qualifies for Medicaid reimbursement, and its results have a major impact on local education agency reimbursement. MassHealth requires a minimum 85% response rate from sampled staff, and falling below that threshold puts your district’s reimbursement at risk.

What did Program Expansion change?

Expansion broadened the School-Based Medicaid Program to cover medically necessary services provided under plans beyond the IEP, including an individual health care plan, a Section 504 plan, an individualized family service plan, and state mandated screenings, along with additional provider types. It increased the range of billable services for districts.

How does NEMB help with RMTS compliance?

NEMB actively monitors RMTS participation for our district clients, tracks response rates, flags at risk staff before a quarter closes, and provides reminders to help maintain the 85% threshold MassHealth requires.

Strengthen Your District’s MassHealth Claiming

The MassHealth School-Based Medicaid Program can be a powerful source of funding, but only for districts that manage RMTS, DSC, and AAC with discipline and expertise. NEMB brings more than 30 years of experience with the program to make sure your district captures everything it has earned.

To learn more, explore our school-based Medicaid billing services, read about School-Based Medicaid Program Expansion, or contact our team to schedule a free consultation. Call 888-771-6115 today to speak with a NEMB specialist.