Individuals with Disabilities Education Act: Education Should	 
Provide Additional Guidance to Help States Smoothly Transition	 
Children to Preschool (14-DEC-05, GAO-06-26).			 
                                                                 
Part C of the Individuals with Disabilities Education Act (IDEA) 
was established to ensure that infants and toddlers with	 
disabilities, from birth to age 3, and their families receive	 
appropriate early intervention services. Within the Department of
Education (Education), the Office of Special Education Programs  
(OSEP) is responsible for awarding and monitoring grants to	 
states for Part C according to IDEA requirements. To address	 
questions about how states have implemented IDEA Part C, this	 
report provides information on (1) how Part C programs differ in 
their eligibility criteria and whom they serve, (2) to what	 
extent states differ in their provision of services and funding, 
and (3) how Education and state lead agencies help support and	 
oversee efforts to implement Part C, such as identifying children
for services and transitioning children to follow-on programs,	 
such as IDEA Part B.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-06-26						        
    ACCNO:   A43217						        
  TITLE:     Individuals with Disabilities Education Act: Education   
Should Provide Additional Guidance to Help States Smoothly	 
Transition Children to Preschool				 
     DATE:   12/14/2005 
  SUBJECT:   Children with disabilities 			 
	     Comparative analysis				 
	     Education program evaluation			 
	     Educational grants 				 
	     Eligibility criteria				 
	     Federal/state relations				 
	     Grants to states					 
	     Preschool education				 
	     Special education					 
	     State-administered programs			 

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GAO-06-26

Individuals with Disabilities Education Act
Contents

Letter 1

Results in Brief 4
Background 7
Eligibility Criteria Differ among States but Are Not Consistently Related
to Percentage of Children Served 11
Selected States Provide Similar Services but Vary in Funding Sources 15
Both OSEP and States Use Data to Monitor Part C Compliance, but Challenges
Persist in Transitioning Children to Part B 22
Conclusions 29
Recommendations for Executive Action 30
Agency Comments and Our Evaluation 30
Appendix I Select Federal and State Funding Sources for Early Intervention
Services 32
Appendix II Comments from the Department of Education 34
Appendix III GAO Contact and Staff Acknowledgments 36

Table

Table 1: Sources of Funding for Early Intervention Services in Site Visit
States 20

Figures

Figure 1: States Visited with Type of Agency Leading Part C and Number and
Percentage of 0-3 Population Participating in Part C 3
Figure 2: Stages of a State Early Intervention System from Intake to
Service Delivery 10
Figure 3: National Percentage of Children Receiving IDEA Services by Age
in 2004 14
Figure 4: Examples of Services States Made Available to Infants and
Toddlers Covered by Part C 16
Figure 5: Percentage of Early Intervention Services Most Frequently
Provided 17
Figure 6: Examples of Federal and State Funding Sources 19

Abbreviations

CDC Centers for Disease Control and Prevention

IDEA Individuals with Disabilities Education Act

IEP individualized education program

LEA local education agency

NEILS National Early Intervention Longitudinal Study

OSEP Office of Special Education Programs

TANF Temporary Assistance for Needy Families

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separately.

United States Government Accountability Office

Washington, DC 20548

December 14, 2005

The Honorable Edward M. Kennedy Ranking Minority Member Committee on
Health, Education, Labor, and Pensions United States Senate

Dear Senator Kennedy:

The first few years of a child's life are critical to development. While
most children attain developmental milestones as expected, some children
develop more slowly or develop differently because of physical, mental, or
environmental factors. Research suggests that for an infant or toddler who
exhibits developmental delay, has a diagnosed condition that has a high
probability of resulting in developmental delay, or is substantially at
risk of having a developmental delay early intervention services, such as
family counseling and physical therapy, can have a significant impact on
early childhood development. To assist states in ensuring that such
infants and toddlers receive early intervention services and support,
Congress appropriated $444 million in fiscal year 2004 for grants to
states under Part C of the Individuals with Disabilities Education Act
(IDEA Part C). States used Part C grants to arrange early intervention
services for approximately 279,000 infants and toddlers with disabilities
from birth to age 3. Administered by the Department of Education's
(Education) Office of Special Education Programs (OSEP), Part C is
intended to support states' efforts to coordinate and leverage funding
from other federal, private, state, and local sources to ensure early
intervention services are available to eligible children. For services to
children with disabilities after their third birthday, IDEA Part B Section
619 provides grants to states to provide special education and related
services to children with disabilities aged 3 through 5 and, at a state's
discretion, to children before their third birthday.

Given your interest in the manner in which states have implemented the
provisions of Part C, we examined (1) how Part C programs differ in their
eligibility criteria and whom they serve, (2) to what extent states differ
in their provision of services and funding, and (3) how Education and
state lead agencies help support and oversee efforts to implement Part C,
such as identifying children for services and transitioning children to
IDEA Part B or other services.

We used multiple data collection methods to address these issues. We
conducted site visits to seven states-Colorado, Hawaii, Illinois,
Maryland, Massachusetts, New Jersey, and Oregon-and reviewed their annual
performance reports. We chose states to visit based on the type of state
agency responsible for coordinating the Part C program (lead agency),
number of children served, whether the state served at-risk children,
geographic location, and whether the state participated in an OSEP-funded
project aimed at early identification of infants and toddlers. Figure 1
illustrates the states visited and selected characteristics.

Figure 1: States Visited with Type of Agency Leading Part C and Number and
Percentage of 0-3 Population Participating in Part C

Note: Hawaii and Massachusetts serve at-risk children.

In each of the selected sites, we met with state Part C coordinators,
states' Part B staff responsible for transitioning children to preschool
programs, and the manager of one or more local early intervention
programs. Because Medicaid-the federal-state health-financing program for
certain low-income individuals-can be an important source of funds for
early intervention services for Medicaid-eligible children, we also met
with Medicaid officials in three states. Additionally, we met with OSEP
officials and reviewed their guidance and monitoring reports. We also
analyzed 2002, 2003, and 2004 data collected by Education. We used the
most recent data available from OSEP. These data, available at
IDEAdata.org, include information about infants and toddlers with
disabilities, such as the services they received, the location where they
received them, and what follow-on program they entered when they were no
longer eligible for Part C. We used information from IDEAdata.org for the
50 states and the District of Columbia. Although we determined that some
data provided by OSEP were not reliable, we obtained documents
demonstrating that the office has controls in place to ensure a reasonable
degree of accuracy and reliability in many of its data, and determined
that the data elements we used were sufficiently reliable for our
purposes. We also conducted interviews with educational associations,
officials from the Centers for Disease Control and Prevention's National
Center on Birth Defects and Developmental Disabilities, and other experts.
Our work involved reviewing the availability and differences in types of
services; we did not examine the quality of services delivered or the
appropriateness of services provided to children. We conducted our work in
accordance with generally accepted government auditing standards between
September 2004 and December 2005.

                                Results in Brief

Nationwide, states' eligibility criteria for Part C services differ, but
are not consistently related to the percentage of children served. State
eligibility requirements vary for children who do not have an established
or diagnosed condition that has a high probability of resulting in
developmental delay. Most states require that such children exhibit a
specific level of developmental delay and be deemed eligible according to
an informed clinical opinion. A few states rely exclusively on clinical
judgment. For example, Arizona requires 50 percent delay in one or more
aspects of development, such as physical or emotional, while Hawaii relies
on the judgment of a team of clinicians. Moreover, eight states also
include in their eligibility criteria infants and toddlers who are at risk
of having a substantial developmental delay because of biological risks,
such as low birth weight, or environmental risks, such as parental
substance abuse. However, eligibility criteria do not sufficiently explain
differences in the percentage of all infants and toddlers in a state
receiving early intervention services. The Centers for Disease Control and
Prevention (CDC) reported a lack of data on the prevalence in the general
population of children under 3 who have developmental delays and could
benefit from early intervention services; many conditions covered by the
Part C eligibility definitions-such as learning disabilities or emotional
disorders-are not routinely tracked. Although IDEA Part C is intended to
cover children from birth to age 3, most states (38) provide the majority
of their Part C services to children 2 to 3 years old. States have
developed public awareness campaigns to help identify more infants and
toddlers in need of services, but officials in the states we visited told
us that a number of obstacles prevented them from reaching all children as
early as possible, including difficulty in reaching children in families
where English is a second language or families living in rural areas.

The states we visited provided similar services and confronted similar
challenges recruiting and retaining staff to deliver them, but they varied
in funding sources. States are required to provide certain services to
children in early intervention programs, including occupational, physical,
and speech language therapy to help with skills like feeding, walking, and
talking. However, states reported challenges recruiting and retaining
individuals to provide these services, especially speech language
pathologists and occupational therapists. State officials noted that
providers often have to spend time traveling to the homes of families to
deliver services, which they said could be burdensome, and they also noted
salaries are often higher in the private health care sector. States use
various sources of funding to support Part C services, with some relying
on multiple funding sources and others relying primarily on Part C and
state general revenue funds. State general revenue funds constituted the
largest source of early intervention funding in most of the states we
visited, while local funds were often a much smaller source. Officials in
the states we visited said there were challenges in accessing some funding
sources, such as Medicaid. We found inconsistencies in the funding data
states provided to OSEP as part of their annual performance reports, and
OSEP decided during our review that the data were incomplete and
unreliable and announced plans to stop collecting them.

OSEP and state lead agencies provide training and technical assistance and
use data to monitor implementation of IDEA Part C, but they have lacked
some information needed from local service providers to determine if
children are smoothly transitioning from Part C to Part B. To monitor
states' compliance with Part C requirements and to target technical
assistance, OSEP examines annual performance reports, performance
indicators, and other data provided by state lead agencies. States, which
are responsible for oversight of local programs, are free to design their
own oversight methods, but they generally described approaches similar to
OSEP's. Despite oversight and assistance activities, state and local
officials in the states we visited cited challenges in transitioning
children to Part B services when they turn 3 years old. In addition, in
commenting on a draft of this report, Education cited preliminary
unpublished data that would suggest transitions are a year-round problem.
Officials in the states we visited reported that some children who turn 3
during the summer experience gaps in service during the transition
process. The gaps occur, in part, because school districts generally
operate on a 9-month academic calendar and some school districts may delay
determination of eligibility for any Part B services until the fall. If
Part B eligibility is not determined prior to children turning 3 during
the summer months, then subsequent decisions regarding extended school
year services cannot be made. Most officials said the frequency with which
extended school year services are provided to children transitioning to
Part B could not be determined because neither OSEP nor the state
collected extended school year data. Also, Part C officials and local
early intervention staff told us they face difficulties in finding out if
children are determined eligible for Part B. Not having eligibility
information hinders local early intervention staff's timely referral of
children found ineligible for Part B to other follow-on preschool
programs. Additionally, Part C officials are responsible for reporting
Part B eligibility to OSEP.

In its comments on a draft of this report, Education disagreed with our
recommendation that it incorporate into its research agenda a method for
determining how frequently children transitioning from Part C to Part B do
not receive services during the summer months. Education noted that
preliminary and unpublished data from a department study indicate that
gaps occur when children are transitioned from Part C to Part B, not only
during the summer, but whenever transitions occur. Additionally, in
response to our recommendation that if gaps in services are found to be a
problem, Education should provide states with additional guidance on
improving children's access to extended school year services, Education
stated that, based on its preliminary data, there is no need to study
extended school year services. We modified our recommendation to
acknowledge Education's ongoing study and are now recommending that the
Secretary of Education provide states with additional guidance on
transition planning and services for children with birthdays during the
summer and especially in cases where children are likely to need extended
school year services. Additionally, when Education completes and verifies
the results from its ongoing studies relating to transitioning, it should
use that information to inform the department's guidance on transitioning.

                                   Background

According to research, comprehensive early intervention programs can
positively affect the progress of children with developmental delays and
children at risk of having a disability. Services provided by these
programs may include speech language therapy, family counseling, and home
visits. Research has linked early intervention services to improvements in
toddlers' behavior, interactions between parents and children, infant
development, and overall quality of life for children and their families.
Additionally, research has found increased mental development and better
vocabulary and reasoning skills for children who received early
intervention services when compared with those who did not receive these
services. Findings from the National Early Intervention Longitudinal Study
(NEILS), a research project sponsored by the Department of Education, has
found that parents report a high degree of satisfaction after receiving 3
years of early intervention services, reporting that their families are
better off and that early intervention services are having "a lot" of
impact on their child's development.1

IDEA is the primary federal education law for infants, toddlers, children,
and youth with disabilities. Grants to states for early intervention
services and special education and related services for children with
disabilities and their families are provided mainly through Parts C and B
of the act. These parts have different histories and are generally
administered by different agencies at the state level. IDEA Part C was
established to ensure that infants and toddlers, from birth to age 3, with
disabilities or at risk of developing a disability, and their families
receive appropriate early intervention services. Part C focuses on, among
other things, enhancing the development of infants and toddlers with
disabilities by providing services in a natural environment, such as the
home or a child care center. This part of the law seeks to improve the
capacity of the family to meet the child's needs and reduce educational
costs by minimizing the need for special education when the child is
older. Part B, in contrast, requires that services, to the extent
possible, be provided in educational settings, such as regular classrooms.
Part B, which includes state grants for children and young adults ages 3
through 21, and Part B Section 619 preschool grants for children 3 through
5, aims to ensure that children with disabilities have access to a free
appropriate public education. Funding for Part B is significantly larger
than for Part C programs. In fiscal year 2004, Part C was funded at $444
million, and approximately 279,000 infants and toddlers received
services.2 In contrast, Part B state grants and the Section 619 supplement
for preschool services were funded at $10 billion and $388 million,
respectively, in 2004. Approximately 6 million children were provided
services under Part B state grants, and over 693,000 children were
provided preschool services under Part B Section 619.

1NEILS is tracking the outcomes of over 3,300 infants and toddlers with
disabilities and those at risk of a disability and their families. The
study tracks children starting from their experiences in early
intervention to early elementary school and will provide outcome data on
children and families receiving early intervention and how these outcomes
relate to child and family characteristics and the types of services
provided. The grant for the study ends in 2005 and the final report is
anticipated to be available in 2006.

To meet Part C goals, states use funds to develop a statewide,
coordinated, multidisciplinary, interagency system of early intervention
services for infants and toddlers with disabilities and their families.
Developing such a system includes designating a lead agency, preparation
and dissemination of materials on the availability of services, defining
eligibility criteria, and delivering services. To this end, each state has
a designated lead agency responsible for the administration, supervision,
and monitoring of Part C. In contrast to Part B, which is led by state
education departments, Part C is led by the health department in 16
states, education departments in 11 states, and other departments,
including combined health and human services departments, in the remaining
23 states. States are expected to leverage funding, services, and
resources from other sources to provide early intervention services. Each
state must have a continuous process of public awareness activities and
evaluations designed to identify and refer as early as possible all young
children with disabilities and their families who are in need of early
intervention services. By law, public awareness efforts should include
disseminating information to parents on available early intervention
services and to all primary referral sources, especially hospitals and
physicians. Efforts may also include television ads, pamphlets, and
posters describing IDEA Part C and how parents can access services for
their child.

Once a child is referred and suspected of having a disability, states are
required to conduct an evaluation to determine if the child meets the
state's eligibility criteria. In order to be eligible for federal funds
under Part C, IDEA requires that states provide services to any child
under 3 years of age who is developmentally delayed. These delays must be
measured by appropriate diagnostic instruments and procedures or validated
by professional opinion, and may occur in one or more of the areas of
development-including cognitive, physical, communicative, social or
emotional development, and adaptive behavior, such as feeding or
toileting. States must also provide services to those children that have a
diagnosed mental or physical condition that has a high probability of
resulting in developmental delay. However, states are free to define what
constitutes a developmental delay and specify how this will be measured.
In addition, states may choose to serve children who are at risk of having
a substantial developmental delay. These may include biological risks,
such as low birth weight, and environmental risks, such as parental
substance abuse. Once an eligible delay has been detected, service
coordinators work with parents and others to match children with services
specific to their needs. Part C requires that every state make certain
services available, including special therapies such as physical,
occupational, or speech language therapy, and family supports such as home
visits. For example, an occupational therapist may come to a child's home
to teach a child to draw, which involves hand and eye coordination. The
law also requires that services be provided in children's natural
environments. Figure 2 illustrates the typical process in early
intervention programs.

2Part C was appropriated $441 million for fiscal year 2005.

Figure 2: Stages of a State Early Intervention System from Intake to
Service Delivery

Children eligible for Part C can receive early intervention services until
they turn 3 years of age. Part C funds can be used to provide services to
children from their third birthday to the beginning of the following
school year, but as of 2004 only 14 states have adopted such a policy.
Thirty states allow for the use of Section 619 preschool funds to provide
services to children before their third birthday. As a child approaches
age 3, the local education agency (LEA) determines the child's eligibility
for Part B Section 619 preschool services. If eligible for Part B Section
619, the child might also be eligible for extended school year services.
An extended school year ensures that a child can continue receiving
services even when schools are not in session, for example, during the
summer. According to Education, most children under Part B do not receive
extended school year services. By contrast, Part C is a year-round
program. Eligibility for an extended school year is determined on an
individual basis and is generally based on how much a child will regress
and the time it will take to regain lost skills. During the most recent
reauthorization of IDEA, in 2004, Congress gave states the option of
allowing children to continue to receive services under Part C until they
become eligible for kindergarten.

  Eligibility Criteria Differ among States but Are Not Consistently Related to
                         Percentage of Children Served

States vary in both the criteria used to establish eligibility for
services and the means used to assess whether children fit these criteria,
but these differences are not consistently related to the percentage of
children receiving early intervention services. While Part C is intended
to serve infants and toddlers from birth to age 3, the majority of
children receiving services nationwide and in most states are toddlers
between ages 2 and 3. Officials in states we visited told us that despite
their various public awareness efforts, there are a number of challenges
in identifying all children eligible for services, specifically reaching
children whose families speak limited English or live in rural areas.
Comprehensive data on the number of children who could benefit from early
intervention are not available; many conditions covered by Part C-such as
emotional disorders and learning disabilities-are not systematically
tracked.

States Have Different Eligibility Criteria and Means of Assessing Developmental
Delay

Nationwide, states' eligibility criteria for Part C services vary, with
most states specifying the amount of delay in development a child must
experience to be eligible for services, while a few rely exclusively on
the judgment of a multidisciplinary clinical team. IDEA generally gives
states the discretion to determine specific eligibility criteria and
diagnostic procedures. For example, Part C specifies that a child have an
established condition that has a high probability of resulting in a
developmental delay, or that a delay is present in one or more areas of
development-cognitive, physical, communicative, social or emotional, or
adaptive-and that all states allow for the use of informed clinical
opinion in their evaluation. However, states can determine the amount of
delay a child must experience in order to be eligible for services. Part C
also gives states discretion to identify the appropriate diagnostic
instruments to measure the extent of a child's delay or to rely
exclusively on the informed opinion of professionals. For example, Arizona
requires a 50 percent delay in one or more aspects of early childhood
development, such as physical or emotional development. New Jersey's
eligibility criteria vary depending on the number of areas in which a
child is developmentally delayed. The state requires that children have a
33 percent delay in one area of development, but a 25 percent delay in two
or more areas of development. The Centers for Disease Control and
Prevention noted that the significance and implication of a given
percentage delay vary across areas of development. For instance, according
to CDC, a 25 percent delay in motor skills development has much different
implications for services for a child than a 25 percent delay in language
development. Other states' eligibility criteria are based on the number of
months or standard deviations from age norms. For example, in
Massachusetts, a 24-month-old child functioning at an 18-month-old level
could be eligible for services. In Georgia, a child whose cognitive
abilities are at least two standard deviations less than the abilities of
most children at the same age would be eligible for services. Hawaii does
not specify a percentage delay and instead relies on the judgment of a
multidisciplinary team, which generally includes either a speech therapist
or special educator and an occupational or physical therapist. Despite
wide variation in how states define eligibility, variation among states in
the percentage of children served is not consistently explained by
eligibility criteria. For example, Alabama, which has broad eligibility
criteria (25 percent delay in one or more areas) served only 1.3 percent
of infants and toddlers in 2004, while North Dakota, which has stricter
eligibility criteria (50 percent delay in one area, 25 percent delay in
two or more areas, informed clinical opinion), served 2.8 percent of its
infants and toddlers. In 2004 the percentage of children served from state
to state ranged between 1.3 and 7.1 percent.

Although not required by Part C, as of March 2005, 8 states-California,
Hawaii, Indiana, Massachusetts, New Hampshire, New Mexico, North Carolina,
and West Virginia-also served children at risk of having a substantial
developmental delay. For example, in Hawaii, children from families where
child abuse or neglect is present may qualify for services. In
Massachusetts, children born with low birth weight or chronic lung disease
may qualify for services. States that we visited that do not serve at-risk
children-Colorado, Illinois, Maryland, New Jersey, and Oregon- expressed
interest in serving them but told us that the additional costs associated
with increasing the number of eligible children prevented them from doing
so. Instead of providing services to at-risk infants and toddlers under
IDEA Part C, some states track at-risk children or provide services to
them through other programs. For instance, in Ohio, children at risk are
served through a statewide program, funded in part by federal dollars,
known as Ohio Early Start. Through this program, they receive services
similar to those children receive under Part C.

Majority of Children Served under Part C Are between Ages 2 and 3

While Part C funding is intended to serve infants and toddlers from birth
to age 3, the majority of children receiving services are toddlers between
ages 2 and 3. In 2004, infants, children under the age of 1, constituted
only 14 percent of the approximately 279,000 children served nationwide,
and 2 to 3-year-olds accounted for 54 percent. Likewise, in 38 states, the
majority of children served were 2 to 3-year-olds. In Maryland and
Illinois, 2 to 3-year-olds made up 54 percent and 55 percent of the
children served, respectively. OSEP and state officials told us that a
majority of children enter the Part C system after age 2 because this is
the age at which speech language delays become apparent and indicated that
such deficiencies are not easily detected in younger children. According
to Education officials, difficulty detecting deficiencies in younger
children is due to numerous factors, including difficulties in assessment,
pediatrician or parent "wait and see" attitudes, and lack of parental
consent. Children who enter the Part C program in infancy are generally
those diagnosed at birth with conditions such as chromosomal abnormalities
and genetic or congenital disorders.

It also appears that many children are eventually identified as needing
services when they become older. Part B Section 619, which serves children
ages 3 through 5 years, serves many more children than Part C, as shown in
figure 3. In 2004, Section 619 served over 693,000 children, compared with
approximately 279,000 children under Part C, and this pattern is mirrored
in most states. This may be attributable to a variety of factors. Some
delays become more apparent as children get older. Developmental delays
are also more likely to be detected once a child enters a group setting,
such as a preschool or kindergarten program, when comparison with peers
may highlight some delays. Additionally, some parents may turn to private
insurance to pay for services during the first few years of a child's
life, and enter the IDEA system when their child enrolls in a formal
education program at ages 3, 4, or 5. However, Massachusetts and Hawaii
serve at least the same number of children in their Part C programs as
they do in their Part B Section 619 programs. Both states include at-risk
children in their Part C eligibility criteria.

Figure 3: National Percentage of Children Receiving IDEA Services by Age
in 2004

States Face Challenges in Identifying All Children Eligible for Services

Officials in the 7 states we visited told us that a number of obstacles
prevented them from reaching all children, even though all of these
states, as required by law, had developed public awareness campaigns to
help identify infants and toddlers in need of services. To inform the
public of the program, states used television, radio, and newspaper ads;
presentations at community fairs; and distribution of pamphlets and
brochures at doctors' offices, hospitals, and other appropriate locations.
For example, in one of the sites we visited, posters were developed to
hang in doctors' offices across the state to help inform parents about
Part C.

Despite their public awareness campaigns, the states we visited reported
having difficulty reaching all eligible children. Officials noted that it
can be especially difficult to reach families for which English is a
second language. While some states we visited produced public awareness
materials in Spanish, they had not expanded their efforts to include
materials in other languages. Officials also told us that it can be hard
to reach families who live in rural areas because they may visit a
pediatrician less frequently because of the long distance they must travel
to get to the doctor. While officials in 6 of the 7 states we visited
noted that physicians were the principal source of referrals, they also
told us that they believed physicians were hesitant to make referrals to
Part C programs because of a fear of misdiagnosing a child with a
disability. They believed that a misdiagnosis could cause unnecessary
anxiety in a parent whose child is developing more slowly but would
eventually begin to demonstrate age-appropriate skills without needing
early intervention services. Additionally, the American Academy of
Pediatrics found through its own studies that a lack of understanding of
the early intervention program's processes and procedures is a barrier to
physicians' referring children.

      Selected States Provide Similar Services but Vary in Funding Sources

States provide a broad array of early intervention services to eligible
children and face similar challenges in recruiting and retaining staff to
provide these services, but they vary in the sources of funding they draw
from. States provide a wide range of medical and educational services to
children and their families and rely on professionals, including
occupational therapists, physical therapists, and speech language
pathologists, to deliver these services. Yet officials in the states we
visited reported that they are finding it increasingly difficult to
recruit and retain these individuals. To fund early intervention services
for children from birth to age 3, states relied on funding from multiple
sources, including federal, state, and private funding. However, some
states reported difficulties accessing certain types of funding, such as
Medicaid.

States Provided a Broad Array of Services to Infants and Toddlers, but States We
Visited Reported Challenges Recruiting and Retaining Staff

As required under Part C, states provide a broad array of early
intervention services to infants and toddlers. Under Part C, infants and
toddlers with a disability are entitled to receive an evaluation of their
strengths and needs, service coordination, and support for a smooth
transition from early intervention to preschool programs. In addition,
children receive individualized services that may include physical
therapy, family counseling, and nutrition services. States, as required by
law, reported making all services shown in figure 4 available to infants
and toddlers.

Figure 4: Examples of Services States Made Available to Infants and
Toddlers Covered by Part C

Figure 5 shows that the most frequently received services nationwide are
speech language therapy, special instruction, physical therapy, and
occupational therapy. Psychological and nutrition services were among the
least frequently provided. The states we visited were similar in their mix
of services. For example, in states such as Maryland, Oregon, and
Colorado, speech language, physical, and occupational therapy, to help
with skills like feeding, walking, and talking, were the most frequently
provided services, and services such as psychological services and
nutrition services were rarely provided.

Figure 5: Percentage of Early Intervention Services Most Frequently
Provided

These services were provided in a variety of settings, including the home,
hospital, and day care, and through public and private service providers.
For instance, according to Maryland officials, LEAs, departments of
health, and departments of human services in the state provide services to
infants and toddlers in addition to private providers. In Massachusetts, a
network of private programs provides early intervention services under
contract with the state.

Officials in each of the states we visited reported challenges in
recruiting and retaining staff to provide early intervention services.
Specifically, speech language pathologist and occupational therapist were
the most difficult positions to fill. Officials cited several reasons for
these challenges. Early intervention staff are required by Part C to serve
children in natural environments, such as homes or child care centers.
This requires staff to travel to these locations, which can be
time-consuming and costly. For instance, in Hawaii, state officials told
us that it is hard to schedule services for children in neighboring
islands because of the long travel times to reach them. Additionally,
state officials told us that salaries earned by early intervention
contractors were not always competitive with salaries and benefits
available in the private health care sector. These challenges make it
difficult for some early intervention programs to hire professional staff.
Understaffed programs can often result in heavier caseloads in which
children do not receive services or receive services less often than
intended.

States Use Various Funding Sources in Addition to Part C, but Selected States
Report Difficulties Accessing Funds

To help pay for services for infants and toddlers, states draw on a range
of federal, state, and local funding sources. As shown in figure 6, states
accessed funds from a variety of sources at the federal level, including
the Child Care and Development Block Grant, IDEA Part B, and Medicaid, and
from the state level. See appendix I for a glossary of these federal and
state funding sources.

Figure 6: Examples of Federal and State Funding Sources

State general revenue funds represent the most frequently used funds by
states after federal Part C dollars. All 50 states reported using state
general funds.

For most states we visited, local support represented a small proportion
of reported early intervention funding, but in one-Maryland-it accounted
for 51 percent. However, states did report receiving funds from local
sources or through private insurance and fees collected from a child's
family. For example, New Jersey charges a sliding monthly fee based on
family size and income relative to federal poverty guidelines. State
officials said families that can afford to contribute to the cost of
service provision do so, but families that cannot afford the fee still
receive services. In fiscal year 2003, New Jersey collected $43,862 in
revenue from this fee, which made up less than 1 percent of its reported
early intervention service funding.

In 4 of the 7 states we visited, states provided most of the funding for
services for infants and toddlers, and Part C represented a smaller
percentage of total funding. For example, in Illinois, state general
revenue funds represented 57 percent of the total funding reported for
infants and toddlers with disabilities, and Part C funds represented 17
percent. However, Part C represented a larger percentage of reported
funding in certain states. For instance, in Colorado, Part C funds made up
38 percent of funds reported for infants and toddlers with disabilities.
See table 1 for funding sources in the states we visited.

Table 1: Sources of Funding for Early Intervention Services in Site Visit
States

(Dollars in millions)
                                           State                              
                          Other          general Other        Private   Local 
                 Part C federal Medicaid revenue state insurance/fees support
Colorado       $6.10   $0.00    $3.10   $6.80 $0.00          $0.00   $0.00 
Hawaiia        $2.00   $0.19    $0.02   $8.00 $0.01          $0.00   $0.41 
Illinois      $15.20   $0.00   $15.20  $49.70 $0.00          $6.20   $0.00 
Maryland       $7.60   $4.70    $1.80   $5.20 $2.30          $0.01  $23.20 
Massachusetts  $8.40   $0.21   $19.40  $29.90 $0.00         $32.20   $0.00 
New Jersey    $13.70   $0.50    $4.40  $40.60 $1.00          $0.04   $5.20 
Oregonb        $4.50   $0.00    $2.10   $8.00 $1.80          $0.00   $0.00 

Source: GAO analysis of fiscal year 2003 data provided by state officials.

aFunding data for Hawaii are incomplete, as the state does not include
data from its Public Health Nursing Branch and Healthy Start programs.

bOregon's Medicaid data are for both Part B and Part C; the state does not
separate the two programs.

Beyond our collection of funding data in our seven site visits, we looked
at funding data for all 50 states by examining the information states
provided to OSEP as part of their annual performance reports. Their data
included federal, state, and local funding sources, as well as the dollar
amounts for each. However, during the course of our review, we found that
data were incomplete. For instance, Hawaii did not report funding for two
programs that provide early intervention services. We found similar gaps
in examining funding data reported to OSEP by additional states.3 During
the course of our review, OSEP concluded the funding data from states were
unreliable and announced plans to stop collecting such data.

States we visited reported challenges in accessing certain funding
sources. For some smaller programs and funding sources, officials in some
states we visited said the paperwork was too cumbersome for the small
amount of funding they might receive in return. In other cases, some
officials reported difficulty obtaining Medicaid reimbursement for Part C
services. In Oregon, where the state department of education is the lead
agency, officials explained that the different terminology educators use
to describe certain needed services makes it hard to access Medicaid for
early intervention services. For instance, Medicaid may pay for
occupational therapy if the purpose is health-related in nature-such as
teaching a child to eat. But Medicaid may not provide reimbursement if the
stated purpose of the therapy appears educational, such as teaching a
child to grasp a crayon to draw.4 Despite the challenges some states
reported, Massachusetts officials cited a strong and collaborative working
relationship with Medicaid and private insurance. For example, since 1985,
the state has had operational standards that include reimbursement of
virtually all Part C services through Medicaid.

3 A 2004 expenditure study, conducted as part of the National Early
Intervention Longitudinal Study, concluded that early intervention
programs use a blend of federal, state, and local funding to provide early
intervention services, but that while programs could report sources of
funding, they had difficulty reporting precise amounts of funding or
breaking down the revenues by sources.

4 We earlier reported challenges in coordinating Medicaid and IDEA for
school-aged children. See GAO, Medicaid and Special Education:
Coordination of Services for Children with Disabilities Is Evolving,
GAO/HEHS-00-20 (Washington, D.C.: Dec. 10, 1999).

Both OSEP and States Use Data to Monitor Part C Compliance, but Challenges
                  Persist in Transitioning Children to Part B

OSEP monitors the states, which in turn oversee local Part C programs by
examining data on how well programs identify, serve, and transition
children to other programs when they are too old for Part C. In its
oversight, OSEP tracks data on program performance submitted by states
through annual performance reports and other mechanisms. As part of its
efforts, OSEP uses two key performance indicators-percentage of infants
and toddlers receiving early intervention services and the percentage of
these children receiving services in natural environments-to target site
visits and technical assistance to programs most in need of guidance.
States oversee Part C in similar ways but are free, within certain
parameters, to design their own oversight strategies. Although federal and
state data and oversight efforts have helped identify some performance
problems, challenges remain in transitioning children from Part C to Part
B Section 619 and other follow-on preschool programs. In 5 of the 7 states
we visited, officials said that some children who turn 3 during the summer
and are eligible for Part B preschool experience service gaps when school
is not in session. OSEP does not have data on how frequently children are
provided extended year services during the summer months.

OSEP Monitors and Supports Implementation of Part C by Tracking Key Data

To ensure that programs are managed well and that eligible infants and
toddlers receive the services they need, OSEP monitors the states by
collecting and tracking key data. Specifically, each state submits an
annual performance report to OSEP, which includes a narrative on five
areas of program performance and plans for improvement. States report on
(1) what they are doing to identify children and the effectiveness of
these efforts; (2) how well they are helping families develop the skills
they need to help their children; (3) whether services are provided to
children in a natural environment, such as, home, day care, or other
programs for typically developing children; (4) whether transition
planning is available to children and their families; and (5) what they
are doing to supervise and manage local programs. States report on
progress or challenges in meeting performance goals and state-developed
indicators as well as projected timelines, activities, and resources
needed to achieve future targets. For example, with respect to identifying
all children eligible for services, Illinois set a goal for the period
covering July 2003 to June 2004 to increase the percentage of children
receiving early intervention services to 2.6 percent of all children and
to screen 200,000 children for developmental delays, approximately 37
percent of the state's population age 0 to 3. In its annual performance
report for that period, Illinois described the strategies it used to
exceed its participation target-2.76 percent of children received
services-and explained why it fell 58,000 children short of its target for
screenings.

In addition to information submitted as part of the annual performance
reports, states also report data to OSEP in five areas: (1) number and
percentage of children receiving services, (2) the specific settings in
which children receive services, (3) number of children who stopped
receiving Part C services and the reason for stopping, (4) number and
types of services provided, and (5) the number of clinical personnel
employed or contracted to provide services. IDEA requires states to submit
data in the first three areas, and OSEP, under authority granted to it in
IDEA, requires states to submit data in the final two areas. For future
reporting periods OSEP plans to discontinue collection of personnel data
because they were found to be unreliable. Additionally, OSEP will stop
collecting information about the number and types of services provided.
The reporting data complement and inform topics covered in the annual
performance reports.

Failure to Reach a Key Child Identification Indicator Can Signal Part C
Compliance Problems

OSEP uses the annual performance reports and other reporting data to
identify problem areas and target its oversight efforts. In particular,
OSEP compares states against the national average on two performance
indicators: (1) the percentage of all infants and toddlers in the state
receiving early intervention services, which was 2.2 percent as of 2003,
and (2) the percentage of infants and toddlers with disabilities receiving
early intervention services in a natural environment, which was 83
percent, as of 2002.5 These indicators were developed by OSEP with input
from interested parties, including states and the Centers for Disease
Control and Prevention.6 OSEP officials said they chose these indicators
because of their confidence in the accuracy of the data and because they
are closely linked to other Part C requirements. OSEP considers whether
states have fallen below the national average when deciding whether to
target states for technical assistance and closer monitoring. In 2003,
half of all states served less than 2.2 percent of children. OSEP
officials note that the indicators do not directly measure compliance with
Part C, but they serve as an early warning signal that states may need
assistance.

5 The national average for the percentage of all infants and toddlers
receiving early intervention services is calculated based on the birth to
age 3 population receiving early intervention services on December 1
divided by the total number of children ages 0 to 3 on that date. In 2004,
2.3 percent of the nation's infants and toddlers received early
intervention services. The national average for the percentage of infants
and toddlers with disabilities receiving early intervention services in
natural environments is calculated based on the number of children
receiving services in a natural environment (homes and programs for
typically developing children) divided by the total number of children
receiving services in all settings.

6 An initial baseline performance goal of serving 2 percent of states'
population ages 0 to 3 was based on conditions under observation by the
Centers for Disease Control through the Metropolitan Atlanta Developmental
Disabilities Study. These observations did not include certain conditions
covered by Part C that are difficult to detect in young children, such as
learning disabilities and behavioral and social/emotional problems.

OSEP relies on the first performance indicator as a measure of the level
of access states are providing for early interventions and the success of
efforts to identify all eligible children. It has collected this
performance information since at least 1996, and the percentage of the
nation's children between birth and age 3 receiving services has steadily
increased since 1998-from 1.6 percent to 2.2 percent in 2003. Twenty-five
states met or exceeded this indicator in 2003. Of these 25 states, 7
served between 3.4 and 7.7 percent. The fact that half of all states
served 2.2 or more percent, and some served as high as 7.7 percent,
combined with the known difficulties in reaching all eligible children,
suggests that the actual eligible population may be larger than the number
of children states are identifying. The Centers for Disease Control and
Prevention told us that comprehensive data on the number of children who
could benefit from early intervention are not available.

OSEP pays particular attention to states that do not meet its performance
indicator. Failure to meet this indicator can be a signal that the state
is not doing enough to identify all eligible children and raise public
awareness of available early intervention services. First, OSEP might
encourage these states to seek help from technical assistance centers or
OSEP staff. States can get technical assistance on an ongoing basis
through several vehicles, such as conferences, six regional centers,
research and training centers, and a national center. Second, OSEP might
schedule a site visit, at which it would interview state and local
officials, providers, and parents and review program data in more depth.
After OSEP completes a site visit, it prepares a monitoring report
addressing strengths and areas of noncompliance with Part C.

Using data from annual performance reports and site visits, OSEP has found
states out of compliance with Part C for a number of issues related to the
goal of identifying all eligible infants and toddlers for services. OSEP
finds states out of compliance for, among other reasons, not making
adequate public awareness efforts to inform culturally diverse groups
about available early intervention services, not disseminating public
awareness materials to pediatricians and other referral sources in rural
areas, not referring children from underrepresented groups for services in
a timely manner, and not carrying out service coordination
responsibilities. Between July 1, 2002, and June 30, 2003, 14 states were
found out of compliance with child identification requirements. These
states served 0.9 to 7.7 percent of their population, with 9 of the 14
states serving less than 2.2 percent of their population. OSEP found
Nevada (which was the state that served the lowest percentage of infants
and toddlers at 0.9 percent in 2003) out of compliance for not ensuring
that all children who may be eligible for early intervention services are
identified, located, referred, and evaluated in accordance with Part C.
Hawaii, which serves the largest percentage of children, including
children at risk of having a substantial developmental delay, was found
out of compliance because it lacked procedures to ensure evaluations and
assessments were conducted in all the areas required by Part C.

When states are not in compliance with Part C and do not show improvement
in their performance, even after receiving technical assistance, OSEP has
several options. Initially, OSEP might work with a state on a plan of
corrective action with a timeline, or issue a letter to the state
documenting the specific problems. As a last resort, OSEP can impose
formal sanctions against a state, including withholding funds, referring
the matter to the Department of Justice, entering into a voluntary
compliance agreement with a state and its respective lead agency that sets
a timeline for bringing the state into compliance, and incorporating
special conditions into a state's grant award. OSEP reports that it rarely
withholds funds or refers any noncompliance issues for Part C programs to
the Department of Justice. Two states, South Carolina and Arizona, are
currently on compliance agreements, and several have special conditions in
their grant awards.7

OSEP is using its second performance indicator, on the percentage of
infants and toddlers with disabilities receiving early intervention
services in a natural environment, in the same way it uses data about the
percentage of all infants and toddlers in the state receiving early
intervention services. OSEP officials told us that on the basis of
provisions in the 2004 reauthorization of IDEA, they recently developed a
new set of performance indicators. States will submit to OSEP baseline
data on these measures in December 2005. The new indicators generally
build upon data currently being collected to look in new ways at how
states provide early intervention services in a natural environment,
identify children, transition children to follow-on services, and address
supervision and management issues. For example, the new indicators for
identifying children include a comparison of the percentage of children
served in each state with the average in other states with similar
eligibility criteria, and information about the percentage of children who
proceeded through the evaluation, assessment, and service planning stages
of the early intervention system according to timelines required by Part
C. Similarly, the new transitioning indicators require information about
the percentage of children who receive timely transition planning.

7 For additional information on OSEP's efforts to address issues of
noncompliance under Part B of IDEA see GAO, Special Education: Improved
Timelines and Better Use of Enforcement Actions Could Strengthen
Education's Monitoring System, GAO-04-879 (Washington, D.C.: Sept. 9,
2004).

States Have Responsibility for Oversight of Local Early Intervention Providers

State lead agencies play a critical role in monitoring and supporting
early intervention services through their responsibility for local Part C
programs. Instead of directly providing services to infants and toddlers
with developmental delays, in the states we visited, local and regional
early intervention programs generally deliver and coordinate services. The
states, then, are responsible for ensuring the local programs are in
compliance with Part C. States use many of the same approaches as OSEP in
monitoring and supporting local programs, such as file reviews, reporting
requirements, program certification or funding awards, employing training
and technical assistance staff, and monitoring visits. States frequently
interact with local early intervention programs. For example,
Massachusetts officials seek to visit half of their 63 local programs each
year.

OSEP encourages collection of outcome data from parents and is sponsoring
research on outcomes, which is scheduled to be completed in 2006. At least
4 of the states we visited monitor early intervention services by
conducting parent surveys. The surveys measure parental satisfaction with
the delivery of early intervention services, how well parents feel
services are coordinated, and parents' experiences working with staff to
transition their children to follow-on services. OSEP provides funding for
technical assistance to help states develop parent surveys. These survey
data and information from OSEP's National Early Intervention Longitudinal
Study are potential sources of outcome data about early intervention
services. Additionally, the Early Childhood Outcomes Center, a 5-year
project funded by OSEP, is providing technical assistance to support
states in developing and implementing other outcome measurement systems
for children with disabilities. The Early Childhood Outcomes Center is
attempting to develop outcome data that can be aggregated at the national
level, document program effects, and improve programs at the local and
state levels.

State Part C officials we spoke with explained that they have to hold
local early intervention programs accountable for the same performance
indicators for which OSEP holds them accountable. As with OSEP, state Part
C coordinators have taken actions to enforce compliance with IDEA.
Officials in Colorado said they had taken away funding from programs that
failed to comply with Part C requirements. Also, when states fail to
enforce IDEA requirements, they risk not only being found in
noncompliance, but also lawsuits brought by individuals under IDEA. Such
was the case in Hawaii and Illinois. In Hawaii, parents and mental health
advocates alleged that qualified handicapped children were not receiving
mental health services. In Illinois, plaintiffs alleged that the state had
a waiting list for children who were eligible for services. Both states
settled the lawsuits by agreeing to take specific steps to come into
compliance with the act.

Overseeing and Coordinating Transitions to Part B Remains a Challenge

Although the information that OSEP and the states compile has helped
identify some performance problems, overseeing and coordinating children's
transitions to IDEA Part B remains a challenge. The transition process
involves several sequential steps, and when any of these steps are
delayed, a child could miss out on critical services and providers can be
left without important information on a child's status. As a child nears
age 3, local early intervention staff must inform the child's family about
follow-on programs that may be available for the child, such as Part B
Section 619. Local early intervention staff, with the approval of the
family, hold a conference with the family and, if the child is potentially
eligible under Part B, LEA officials, to discuss any services the child
may be eligible to receive. This transition planning conference for
children potentially eligible under Part B, must occur at least 90 days
before the child's third birthday. Early intervention staff and the family
must develop a written transition plan. And if the child is believed
eligible for Part B services, early intervention staff must notify the
LEA. The LEA must determine the child's eligibility within a reasonable
time frame, and if the child is found eligible, a meeting to develop an
individualized education program (IEP) for the child must be conducted
within 30 days. Part B requires teachers, parents, school administrators,
and related services personnel to develop the IEP shortly after a child is
found eligible for Part B services, and the IEP guides the delivery of
special education supports and services for a student with disabilities.

While IDEA requires states and local programs to provide transition
planning and follow these specific procedures, we found in our site visits
that delays still happen. Education cited preliminary unpublished data
that would suggest transitions are a year-round problem. We found that
delays generally occur for two reasons. First, data in annual performance
reports indicate that some states have difficulty scheduling transition
meetings 90 days in advance of a child's third birthday. State and local
officials we interviewed said it was difficult to assemble all of the
requisite individuals for the conference before the deadline. Second, some
state officials expressed concern about the timing of the LEA's decision
on a child's eligibility. The decision may be delayed until the following
school year for children with summer birthdays because LEAs generally
operate on a 9- or 10-month academic calendar. In 5 of the 7 states we
visited, officials said that some children who turn 3 during the summer
and are eligible for Part B preschool experience service gaps when school
is not in session. As a result of these delays in the transition process,
some children who need extended school year services during the summer may
not receive them. Most of the states we visited do not keep track of the
number of eligible children who do or do not receive extended school year
services.

There are two potential ways to ensure children do not experience gaps in
services. First, extending Part C services until children are eligible to
enter kindergarten, which was permitted for the first time with the
reauthorization of IDEA in 2004, could mitigate some of the challenges
associated with transitioning children. However, none of the states we
visited plan to exercise this option. States indicated that it would be
too costly for them to extend Part C service and that Part B officials are
not willing to support doing so with Part B Section 619 funds. Second,
Part C funds can be used to provide services to children from their third
birthday to the beginning of the following school year, but an OSEP
technical assistance center reports that as of 2004, while 30 states
permit such use of Part C funds, only 14 states have adopted such a
policy.

In addition to citing delays, state and local officials cited other
obstacles to a smooth transition for children. Local early intervention
programs sometimes have to work with multiple LEAs that each have their
own eligibility criteria for Part B, which complicates coordination. For
example, a local Massachusetts official said that her early intervention
program spans a geographical area that encompasses 13 different LEAs.
Also, LEAs sometimes conduct their own evaluations, contributing to the
time needed for determining Part B eligibility.

State and local officials also reported that early intervention programs
often do not get final notification of a child's eligibility for Part B
services from the LEA. According to OSEP, this information exchange may
not occur for several reasons, including federal laws relating to privacy
and the need for parental consent to share results of Part B evaluations.
Without access to information on eligibility decisions, early intervention
staff do not know whether they need to refer children who are denied Part
B services to other follow-on programs, like Head Start. State Part C
officials are required to report Part B eligibility information to OSEP
when reporting why a child stopped receiving services, but LEAs that
administer Part B do not always provide this information in a timely
manner, if at all. While two of the states we visited are in the process
of developing mechanisms for ensuring early intervention staff have access
to eligibility information, none are currently in use.8 OSEP staff
acknowledged that states need continued support to ensure Part B officials
share eligibility information with early intervention staff.

                                  Conclusions

Scientific research suggests that the earlier a child with disabilities
gets intervention services, the more effective these services may be in
enhancing a child's development. Before a child enters preschool, states
have substantially greater flexibility in determining which infants and
toddlers to serve. IDEA gives states the freedom to set different
eligibility criteria for early intervention services and decide how they
will evaluate children for eligibility. However, it is partly these
variations that make it difficult to determine if states are actually
meeting the early intervention needs of all their developmentally delayed
infants and toddlers.

One of the most pressing challenges is transitioning young children with
disabilities from services provided under IDEA Part C to Part B preschool
or other services at age 3. This transition requires that a sequence of
determinations and agreements among multiple stakeholders take place in a
timely way. Education reported in its comment that it has preliminary data
that suggest that service gaps may occur whenever children transition. In
our interviews with state and early intervention officials, we found that
transition is perhaps most challenging for children who transition during
the summer months. If determination of eligibility for Part B is delayed,
children can be prevented from receiving necessary services, including
those provided through extended school year programs in the summer. Based
on our findings, and Education's preliminary findings from its ongoing
study of preschool services, it appears that without additional guidance,
some children exiting the Part C program and eligible for Part B preschool
may not receive all the services for which they are eligible.

8 The most recent reauthorization of IDEA in 2004 includes a provision for
the local educational agency under Part B to invite, at the request of the
parent, the Part C coordinator or other Part C representative to the
child's initial individualized education plan meeting.

                      Recommendations for Executive Action

In order to assist states in providing a more seamless transition for
children with disabilities from IDEA Part C to Part B, or other preschool
programs, we are recommending that the Secretary of Education provide
states with additional guidance on transition planning and services for
children with birthdays during the summer, and especially in cases where
children are likely to need extended school year services. Additionally,
after Education completes and verifies the results from its ongoing
studies relating to transitioning, that information should be used to
inform the department's guidance to states on transition planning.

                       Agency Comments and Our Evaluation

We provided a draft of this report to Education for review and comment.
Education disagreed with the recommendation we made to incorporate into
its research agenda a method for determining how frequently children
transitioning from Part C to Part B do not receive services during the
summer months, and if gaps in services are found to be a problem, provide
states with additional guidance on improving children's access to extended
school year services. Education noted that preliminary and unpublished
data from a department study indicate that gaps occur when children are
transitioned from Part C to Part B, not only during the summer, but
whenever transitions occur. Additionally, Education stated that based on
its preliminary data, there is no need to study extended school year
service. We believe it is critical to provide children with the services
they need when they need them. If Part B eligibility is not determined
prior to children turning 3 during the summer months, then related
decisions, including those about extended school year services, cannot be
made. We believe that by providing additional guidance, Education can help
states improve transition planning and services and help ensure that
children do not experience gaps in services during critical periods of
their development.

Education also provided technical comments that we incorporated into the
report where appropriate. Education's written comments are reproduced in
appendix II.

We will send copies of this report to the Secretary of Education,
appropriate congressional committees, and others who are interested. We
will also make copies available to others upon request. In addition, the
report will be available at no charge on GAO's Web site at
http://www.gao.gov. If you have any questions about this report, please
call me at (202) 512-7215. Key contributors are listed in appendix III.

Sincerely yours,

Marnie S. Shaul, Director Education, Workforce, and Income Security Issues

Appendix I: Select Federal and State Funding Sources for Early
Intervention Services  Appendix I: Select Federal and State Funding
Sources for Early Intervention Services

The Child Care and Development Block Grant program is a discretionary fund
program that, among other things, supports state efforts to provide child
care to parents trying to achieve independence from public assistance.

Children with Special Health Care Needs refers to a type of program
operated by particular states that provides financial assistance or case
management for needed medical treatment to children with serious and
chronic medical conditions to reduce complications and promote maximum
quality of life.

Developmental Disabilities Services refers to state programs that serve
and support individuals with mental retardation/developmental disabilities
and their families, including early intervention services. For example,
community developmental disability services are supported by state funding
in Kansas, which defines community developmental disability services as
those designed to meet needs associated with work, living in the
community, and individualized supports and services.

Head Start and Early Head Start are comprehensive child development
programs that serve children from birth to age 5, pregnant women, and
their families. These programs are federally funded and locally
administered by community-based nonprofit organizations and school
systems. Grants are awarded by the Department of Health and Human
Services.

IDEA Part B, administered by the Department of Education, provides grants
to states to provide preschool services to children with disabilities from
age 3 to 5.

The Maternal and Child Health Services Block Grant program (Title V of the
Social Security Act) provides federal grants to states and organizations
with the aim of improving the health of mothers and children. Among the
many services supported by grants are support programs for children with
special health needs, care coordination, transportation, home visiting,
and nutrition counseling.

Medicaid is health insurance that helps people who cannot afford medical
care pay for some or all of their medical bills. Medicaid is jointly
funded by the federal and state governments to assist states in furnishing
medical assistance to eligible needy persons.

The Social Services Block Grant (SSBG) program allocates federal funds to
states to support a wide variety of social services programs for adults
and children.

Temporary Assistance for Needy Families (TANF) is a family assistance
block grant from the Department of Health and Human Services to states
that can be used to provide monthly cash assistance payments to families
as well as to finance services for TANF clients or other low-income people
to support their efforts to work.

Tobacco Funds were awarded to states as part of a settlement agreement
with major tobacco companies. Kentucky designated 25 percent of its Phase
I settlement to an early childhood initiative that includes First Steps,
its early intervention system. Kansas allocated all of its settlement for
children's services.

TRICARE is the Department of Defense's regional managed-care program for
delivering health care to members of the armed services and their
families, survivors, and retired members and their families. TRICARE
operates like health maintenance organization plans offered in the private
sector and other similar health insurance programs.

Appendix II: Comments from the Department of Education  Appendix II:
Comments from the Department of Education

Appendix III: GAOSt  Appendix III: GAO Contact and Staff Acknowledgments

                                  GAO Contact

Marnie S. Shaul (202) 512-7215 or [email protected]

                             Staff Acknowledgments

In addition to the contact named above, the following individuals made
important contributions to this report: Betty Ward-Zukerman, Assistant
Director; Ramona Burton, Analyst-in-Charge; Daniele Schiffman, Analyst;
Rachael Chamberlin; Sherri Doughty; Avrum Ashery; Jonathan McMurray;
Beverly Ross; and Daniel Schwimer.

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www.gao.gov/cgi-bin/getrpt?GAO-06-26.

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Highlights of GAO-06-26, a report to the Ranking Minority Member,
Committee on Health, Education, Labor, and Pensions, U.S. Senate.

December 2005

INDIVIDUALS WITH DISABILITIES EDUCATION ACT

Education Should Provide Additional Guidance to Help States Smoothly
Transition Children to Preschool

Part C of the Individuals with Disabilities Education Act (IDEA) was
established to ensure that infants and toddlers with disabilities, from
birth to age 3, and their families receive appropriate early intervention
services. Within the Department of Education (Education), the Office of
Special Education Programs (OSEP) is responsible for awarding and
monitoring grants to states for Part C according to IDEA requirements. To
address questions about how states have implemented IDEA Part C, this
report provides information on (1) how Part C programs differ in their
eligibility criteria and whom they serve, (2) to what extent states differ
in their provision of services and funding, and (3) how Education and
state lead agencies help support and oversee efforts to implement Part C,
such as identifying children for services and transitioning children to
follow-on programs, such as IDEA Part B.

What GAO Recommends

GAO recommends that Education provide states with additional guidance on
transition planning and services, especially for children who would enter
Part B during the summer. In comments on our draft, Education cited an
ongoing study of general transition issues. When Education verifies the
results of its study, it should use that information to inform guidance to
states on transition planning.

Eligibility criteria for Part C services for infants and toddlers with
disabilities differ from state to state, but do not consistently explain
the percentage of children served, which ranges between 1.3 and 7.1
percent. To determine eligibility, most states measure how much the child
is delayed in one or more areas of early childhood development, while a
few rely exclusively on a clinical team's judgment. Although IDEA Part C
is intended to cover children from birth to age 3, most states provide the
majority of their Part C services to children 2 to 3 years old. States
have public awareness campaigns to identify more eligible infants and
toddlers but cite a number of obstacles, including difficulty reaching
children in rural areas or in families where English is a second language.

The states we visited provide a similar set of services but vary in
funding sources. States are required to make available certain early
intervention services under IDEA, such as occupational, physical, and
speech therapy. However, states report challenges recruiting and retaining
professionals, such as speech language pathologists, to provide these
services. States rely on various funding sources, but state general
revenue funds were generally the largest source of early intervention
funding.

Percentage of Early Intervention Services Most Frequently Provided

OSEP and state lead agencies have provided training and technical
assistance and used data to monitor implementation of IDEA Part C, but
OSEP has lacked some information from local officials needed to determine
if children are smoothly transitioning from Part C to Part B. OSEP uses
annual reports and performance indicators as part of its effort to monitor
compliance with Part C and target technical assistance. For example, data
on the percentage of children served help inform OSEP of states' efforts
to identify all eligible children. States use similar approaches. Despite
these activities, state officials cited challenges transitioning children
to Part B services when they turn 3 years old. Education indicated that in
preliminary and unpublished data from an ongoing study it had found that
gaps occur throughout the year. Officials in the states we visited
reported that some children who turn 3 during the summer experience gaps
in service. If Part B eligibility is not determined prior to children
turning 3 during the summer, then subsequent decisions about whether
children should receive extended school year services cannot be made.
*** End of document. ***