That money pays for nurses, social workers, physical, occupational and speech therapists and medical equipment such as walkers and wheelchairs. It also pays for preventive and comprehensive health services for poor children, including immunizations, screening for hearing and vision problems and management of chronic conditions like asthma and diabetes.
Many school districts, squeezed by shrinking state education budgets, say that to fill the hole they anticipate would be left by the Republican push to restructure Medicaid, they would either have to cut those services or downsize general education programs that serve all students.
"We'd have to make a local decision about what services we continue to provide and which we don't," said Paul Gausman, superintendent of a school district of 15,000 students in Sioux City, Iowa, that receives about $3 million in Medicaid reimbursements each year.
"I haven't met many people who enjoy writing a check for their taxes, and I understand that," Gausman said. "But it does not mean taxation is evil, and we've got to consider the most vulnerable of our population."
In the Washington area, Montgomery County schools receive about $5 million a year in Medicaid reimbursements, Fairfax County about $1.5 million and D.C. Public Schools $49 million. Cutting that money "is not the way to set D.C.'s young people up for success," D.C. Schools Chancellor Antwan Wilson wrote to families Tuesday.
Schools have been able to register as Medicaid providers and seek reimbursement, as doctors and hospitals do, since 1988. Two-thirds of districts that bill Medicaid use the money to pay the salaries of employees who work directly with children, such as school nurses and therapists, according to a January survey by the School Superintendents Association (AASA).
But the Republican push to overhaul health care would implement a new "per capita cap" system for Medicaid: Instead of matching whatever states spend on Medicaid, the federal government would instead give them a fixed amount for each Medicaid enrollee.
Under the House GOP bill, which passed last month, that change would reduce federal spending about $880 billion over the next decade, according to the nonpartisan Congressional Budget Office. The Senate GOP version would cut about $772 billion over the same time period.
The Senate bill is being revised after pushback from several key Republicans — including Sen. Susan Collins of Maine, who has raised concerns about the impact of Medicaid cuts on special education. Details may change as Senate Majority Leader Mitch McConnell (R-Ky.) seeks to negotiate a deal that can pass.
But the underlying philosophy — that controlling federal spending would force the health-care system to become more efficient in providing services — almost certainly would not do that.
Katie Niederee, a spokeswoman for the Senate Finance Committee, said that cuts to Medicaid in the current version of the bill "reflects Republican priorities to bend the cost curve on federal entitlement programs and encourage states that tend to spend beyond their means to actually stay within their budget."
The Republican plan for Medicaid is likely to hurt schools in several ways, said Sasha Pudelski, who tracks health-care policy for the AASA. Most directly, states may decide to prohibit schools from receiving Medicaid dollars because of what is likely to be stiff competition against doctors and hospitals for limited resources, she said.
Less directly, states struggling to cover health-care costs now covered by the federal government would have to seek cuts elsewhere in their budgets, including in education, which accounts for a large share of many states' spending.
"The kids who will be hurt first and foremost are special-ed kids and kids in poverty, but then everybody will be hurt, because we'll have to shift dollars from the general education budget," she said.
Schools receive less than 1 percent of federal Medicaid spending, according to the National Alliance for Medicaid in Schools. But federal Medicaid reimbursements constitute the third-largest federal funding stream to public schools, behind $15 billion they receive each year for educating poor children and $13 billion they receive to educate students with disabilities under the Individuals with Disabilities in Education Act (IDEA).
The federal government initially promised far more financial support for IDEA, the four-decade-old law that outlines schools' obligations to educate students with disabilities. Congress pledged to pick up 40 percent of the cost of special-education services under the law, yet has never come close. It now pays only about 15 percent.
Medicaid payments have helped fill that gap. Without those dollars — and facing a recent Supreme Court decision that raised the bar for the services school districts owe students with disabilities — many districts wonder how they will pay for services they now provide.
In the small town of DuQuoin, Ill., about 200 of 1,500 students receive special-education services. Medicaid helps pay the salaries of social workers, speech therapists and school nurses, as well as transportation for students with disabilities.
"If we're not able to access the resources we have now . . . we're going to be hurting kids," said Superintendent Gary Kelly. DuQuoin schools stand to lose about $170,000 in Medicaid reimbursements — a small but important fraction of the district's $15 million annual budget, Kelly said.
Thanks to a political deadlock in the state capital, Illinois is headed into its third year without a budget, and schools across the state — including in DuQuoin — are already scrimping, having cut teaching positions and other costs to balance their books. Illinois schools receive $286 million per year in Medicaid reimbursements, more than any other state except New Jersey and Texas, according to 2015 federal data.
In Crawfordsville, Ind., with a district of 2,400 students, Medicaid helps pay for a full-time registered nurse at each school. Those nurses provide primary care for many low-income students who don't have a doctor of their own, Superintendent Scott Bowling said.
Bowling said that without the $50,000 in reimbursements, he'd have to lay off at least one nurse, and schools would be left without full-time nurse coverage. That gives him pause when he thinks about the emergencies his nurses have confronted: One saved a little boy from a severe asthma attack, administering an EpiPen to open his airways as they waited for medics to arrive. Another said this year she had intervened with two children who were suicidal, urging their parents to seek help immediately.
"Our nurses have literally saved students' lives over the past few years — lives that we may have lost if we had to call them in from another site," Bowling said.