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School and Community Based Therapy Services:
Understanding the Options and Avoiding Insurance Denials
Reviewed July 2025
Children with disabilities or special health care needs often have occupational therapy (OT), physical therapy (PT) and speech-language pathology (SLP) services to enhance their ability to participate in school and their community. These therapies may be provided at school as part of their special education. Therapy services can also be provided in a community-based setting, meaning these therapies can be held at a medical clinic, hospital, at home, or another private setting.
Therapists and Families Working Together
Children get the most benefit from therapy services when families and therapists work together to agree on what is needed. Options might include therapy only at school, in a clinic, other setting, or a combination of these. When a child is receiving therapy in more than one setting, coordination and communication between therapists is essential.
This coordination helps to prevent duplication of services or working toward the same therapy goals in more than one setting. Any duplication may result in your child’s private health insurance or Wisconsin Medicaid denying payment for therapy services. Communication between therapists is the best way to reduce the chances of duplication. Families can request that therapists communicate by phone, email, and/or written logs. Community therapists can be invited to be part of an Individualized Education Plan (IEP) meeting to create different goals for each setting together.
Avoiding Duplication of Services
School and community-based services goals must be different. A child may need therapy services to take part in school, but not in the community, or the other way around. So, therapy goals must be written to be specific: schools must show their therapy goals are educationally necessary, while community-based therapy goals need to be medically necessary.
Did You Know?
- The goal of school-based services is to maintain or improve a child’s education.
- The goal of community-based services is to improve a child’s function and increase their independence at home and in their community.
Covering the Cost of Therapy Services
Families are responsible to make sure their private or employer-sponsored health insurance, or their child’s Medicaid card covers the cost of community-based therapy. The provider will likely submit a prior authorization (PA) request before services begin to ensure the insurance plan covers the cost.
To learn more about Prior Authorizations (PAs), see the Family Voices PA Fact Sheet.
A child’s school, or school district, is responsible for covering the cost of therapy provided at school. Medicaid will not pay for a community therapy service that is provided, or should be provided, at school. However, school districts are allowed to bill Medicaid for the services they provide to students.
- If your child receives school-based therapy, you likely will be asked to sign a Consent to Bill Medicaid, so the school can bill Wisconsin Medicaid to cover the cost of these medically necessary special education or related services. The Department of Public Instruction has more detail on this at Medicaid/School Based Services.
Tip for Families
It’s a good idea to carefully review your child’s IEP to make sure there isn’t any duplication with community-based therapy. Medicaid typically checks for duplication by requesting a copy of your child’s IEP when a clinic or community-based provider submits a prior authorization request for services.
Comparing School-Based and Community Based Therapies
School-Based Therapy
School-based therapy must follow federal and state laws. Therapy at school is considered a related service to special education and is provided only if the child needs this therapy to function in the educational setting.
- The need for school therapy is decided by the IEP team with parents as equal members. The team decides when, where, how often, and the length of each therapy session.
- Therapy is provided at school and can be done in classrooms, hallways, gyms, playgrounds, lunchrooms, or in separate therapy spaces.
- Therapy may be provided one-on-one, in small groups or in the classroom by a therapist or therapy assistant. Intervention may or may not be provided directly with the child. Working with school staff to modify the child’s environment and daily school activities is part of school therapy.
- The decision to end therapy services is made by the child’s IEP team. It may happen because a student is no longer eligible for special education, other members of the IEP team can provide the services, or the child can perform school tasks independently.
- There may still be a need for community-based services after school-based therapy has ended. Families can also request a re-evaluation from their child’s IEP Team if additional school-based therapy is needed.
Community-Based Therapy
Community-based therapy must follow state and national practice guidelines that focus on a child’s medical and functional needs, in the home or community settings.
The family and therapists make the decision about the amount of therapy in community-based therapy plans. For example, the child will participate in weekly visits for 45-minutes per session. The amount of therapy provided may change if the insurance plan, Medicaid or other funding sources won’t cover the cost of the recommended services. Payment denials are often based on a perceived duplication of services between community and school providers, making it especially important for school and community to coordinate their therapy goals.
- A therapist, or therapist assistant usually provides individual treatment. They might assign activities to work on at home (home program).
- The therapist can also provide ongoing caregiver training to help the child continue to practice therapy between community-based appointments.
- Families can request services from a therapist who has specialty training, like soft-tissue stabilization or sensory integration.
- Therapy may be discontinued for different reasons. This may include the child has met the skill goals, no additional progress will be made, or the family is ready to move on.
- There may still be a need for school-based therapy after community-based therapy has ended. Families can request an evaluation for new or additional school-based therapy from their child’s IEP team.
INFORMATION AND RESOURCES
Wisconsin Wayfinder: Children’s Resource Network, 877-WiscWay (877-947-2929): Wisconsin Wayfinder offers families one name and phone number to find services for children with special health care needs. Wayfinder connects you to a resource guide at one of the five Children’s Resource Centers in your area.
- Citation: The source of information in this article comes from a family brochure created by the Wisconsin Occupational Therapy Association
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