Ohio School Funding and School-Based Health

By Madelaine Matej MacQueen, Ph.D., Budget Researcher at Policy Matters Ohio

Ohio Schools Underfunded by $2.75 Billion

In the 2026-2027 biennial budget, Ohio’s legislature underfunded K-12 public schools across the state by $2.75 billion dollars, compared to what they would have received under the Fair School Funding Plan (FSFP)¹

The FSFP² is Ohio’s first school funding formula calculated based on the actual cost of educating a student. A bipartisan group of Ohio legislators and education experts created the FSFP in the years leading up to 2021.³ The plan was to be phased in over three biennia, or six years, reaching a 100% phase-in for the 2026-2027 biennium.

However, the Ohio legislature deviated from the FSFP when enacting HB 96, the state budget bill for 2026-2027.⁴ The legislature updated neither the cost inputs nor the funding weights for specific categories of students, meaning that school support from the state is tethered to what it cost to educate students in 2022 rather than what it costs in 2026-2027.⁵

These funding choices especially harm high-poverty, urban districts. Cleveland Municipal School District received $157 million less in the 2026-2027 biennium than the FSFP would have given it. Columbus received $48.4 million less, and Cincinnati received $50 million less.

Even some of the state’s wealthiest districts received less funding than the FSFP would have given them. Orange City School District is underfunded by $402,219, and Indian Hill Exempted Village School district is underfunded by $294,892.⁶

Of more than 600 school districts in Ohio, 161 will receive more state funding over the biennium than they would have under the FSFP, and a majority of these are low-poverty districts. Because legislators opted to dismantle the FSFP, which was based on real and current costs of educating all students and accounted for districts’ unique needs, districts that rely on state support the most will see funding cuts.⁷

The Ohio Constitution makes the Ohio legislature responsible for funding a “thorough and efficient system” of public schools.⁸ Yet the state legislature has been shirking its duty. In 1997, 2000, 2001, and 2002, the Ohio Supreme Court declared Ohio’s public school funding system to be unconstitutional.⁹ The FSFP was supposed to fix that problem.¹⁰

The FSFP was first implemented in FY 2022. Currently, a combination of federal, state, and local sources fund public schools. (Notably, property taxes play a critical role in school funding across the state. Learn more here.) Ohio’s legislature and governor have lowered the state share of school funding over time, from a high of 47% in 1999¹¹ to an estimated 32.2% in 2027.¹² Between 2002 and 2023, Ohio fell from 35th nationally to 45th in the state share of K-12 revenue.¹³ That means that only five states contribute a smaller portion of their public schools’ funding than Ohio.

Decades of public school funding shortfalls have forced schools to cut costs repeatedly. These shortfalls ultimately hurt students, families, and the teachers and other professionals who work with students every day.

[Has your district made cuts this year because of funding shortfalls? Tell Parents United for Public Schools at this link.]

What We Can Do

Ultimately, Ohioans need to hold legislators accountable and insist that they fully and faithfully implement the FSFP in the next budget, which will cover the 2028-2029 biennium. In the meantime, advocates can document how underfunding harms public schools and school-based services. Additionally, some districts may be able to explore alternative funding sources, especially for healthcare services at school.

In general, school-based health services can be provided by an employee of the school district, an employee of an Educational Service Center (ESC), a community provider, or a School Based Health Center.¹⁴ The last two providers can bill health insurance, a funding source external to traditional school funding.

Funding sources for school-based health services include:

• Student Wellness and Success Funds¹⁵
• Disadvantaged Pupil Impact Aid (DPIA)¹⁶—which is a component of the FSFP
• Medicaid School Program (when applicable)¹⁷
• Commercial health insurance (only for community providers or school-based
  health centers)

School-Based Health Centers (SBHCs)¹⁸ have been expanding their presence across Ohio rapidly since 2011, reaching 125 sites in May 2026.¹⁹ Each SBHC is created through a partnership between a school district and a healthcare provider. SBHCs provide a minimum of primary care services but can include specialty care and offer appointments to the whole family.²⁰ For more information, visit the Ohio Department of Education & Workforce or the Ohio School-Based Health Alliance.

The Medicaid School Program (MSP) is a collaboration between the Ohio Department of Education and Workforce (ODEW) and the Ohio Department of Medicaid (ODM). MSP allows local educational agencies (LEAs), community schools, and state schools for the blind and deaf to seek reimbursement for Medicaid-eligible services provided to students who have services documented within a plan of care, when the student’s disability is impacting their academic achievement or regular school attendance.²¹ Schools and districts must use state, local, or private funds to provide allowable services, and then MSP can reimburse the school for the federal share of each Medicaid service.²² ODM recommends that schools use Student Wellness & Success funds and DPIA for the state share.²³

As of January 2026, ODM has made several changes to the Medicaid School Program, including expanded allowed provider types, billable services, and student eligibility through the creation of the School Services Plan of Care. It also added a “public health” component for Medicaid-enrolled students who do not have a plan of care. Additional changes included updates to the Random Moment Time Study and changes to Medicaid Administrative Claiming.²⁴ If the MSP was previously not useful to a given district, it may be substantially more useful now that it has been expanded.

Conclusion

No one is immune from the costs of underfunding K-12 public schools in Ohio. School healthcare providers can join advocacy efforts for full funding of the FSFP and can urge their district to explore new partnerships for school-based health services as well as new funding sources, including School-Based Health Centers and the Medicaid Schools Program. To stay informed about school funding and advocacy opportunities, register for Policy Matters Ohio’s email list.