When Funding Falls, Services Crumble. How Schools Can Still Meet Their Obligations

Kevin Eberly | Aug 14, 2025

Across the country, special education leaders are bracing for a storm.

In August, news broke that proposed federal Medicaid cuts could strip away as much as $8 billion in annual reimbursements for school-based services. That’s funding districts rely on to cover speech therapy, occupational therapy, counseling, and other supports for students with disabilities.

The timing could not be worse. A March 2025 report from EdResearch for Action found that 51 percent of schools still had open special education positions well into the semester. And in many districts, the shortage isn’t just about finding people — it’s about keeping them. High turnover, rising caseloads, and burnout have forced schools to rely on underqualified staff or delay services altogether.

The result? Students waiting weeks or even months for the help they’re legally entitled to under the Individuals with Disabilities Education Act (IDEA).

A Legal Obligation That Doesn’t Disappear With the Budget

Budget cuts might change what schools can afford, but they don’t change the law. Under IDEA, districts are required to provide services spelled out in a student’s Individualized Education Program (IEP), whether or not the funding is there.

If Medicaid reimbursements disappear, many schools will have to find a way to fund those services from their general budget — which is already stretched thin. Without a plan, districts risk falling out of compliance, triggering complaints, investigations, and, most importantly, real harm to students.

Why the Traditional Model Falls Short

The go-to staffing approach for decades has been to hire full-time or long-term contracted specialists. That model works when budgets are stable and candidate pipelines are strong. But in today’s climate, it leaves schools vulnerable:

• It’s slow — traditional hiring can take months, leaving students without support.
• It’s expensive — full-time hires come with salaries, benefits, and overhead.
• It’s rigid — schools are locked into positions even if needs change midyear.

When positions sit vacant, the choice often comes down to overloading existing staff or outsourcing to high-cost agencies. Neither option is sustainable.

A Flexible Approach for Uncertain Times

One solution gaining traction is a more agile staffing model — drawing on credentialed providers who already work in education and can offer extra hours, short-term coverage, or targeted services. Instead of months-long hiring cycles, schools can connect with professionals who are available to start right away.

This isn’t about replacing full-time staff. It’s about building a flexible bench so districts can adapt to fluctuating needs and budget realities. For example:

• A speech-language pathologist in one district might take on a few hours a week in a neighboring district.
• A school psychologist with a lighter caseload could conduct evaluations for a school that’s months behind.
• A paraeducator available in the afternoons could step in where staffing gaps leave students unsupported.

Protecting Students, Preserving Compliance

The stakes are high. Every delayed session, missed evaluation, or unsupported classroom not only impacts a child’s education — it risks putting the district out of compliance with federal law.

By having on-demand access to qualified professionals, districts can maintain services, avoid legal exposure, and — most importantly — ensure that students get the help they need when they need it.

Medicaid cuts and staffing shortages may feel like forces outside anyone’s control. But how we respond is a choice. Building flexibility into the system now can prevent deeper disruptions later.

Sources

1. Moriah Balingit, Medicaid Cuts Could Hit Special Education Services in Schools, Washington Post (Aug. 6, 2025), https://www.washingtonpost.com/education/2025/08/06/medicaid-special-education-funding-cuts.
2. EdResearch for Action, Special Education Staffing Shortages at the Start of the School Year (Mar. 2025), https://edresearchforaction.org/publications/special-education-staffing-shortages-start-of-year-solutions.
3. Rudi Keller, Missouri State Board of Education Votes to Close 12 Schools for Disabled Students, Missouri Independent (Aug. 13, 2025), https://missouriindependent.com/briefs/missouri-state-board-of-education-votes-to-close-12-schools-for-disabled-students.