Section 368-E. Reimbursement to counties for pre-school children with handicapping conditions

1. The department of health shall review claims
  for expenditures made by counties and the city of New York  for  medical
  care,  services  and  supplies which are furnished to preschool children
  with handicapping conditions or such  preschool  children  suspected  of
  having  handicapping  conditions,  as  such  children are defined in the
  education law. If approved by the department, payment for  such  medical
  care,   services   and   supplies  which  would  otherwise  qualify  for
  reimbursement under this title and which  are  furnished  in  accordance
  with  this title and the regulations of the department to such children,
  shall be made in  accordance  with  the  department's  approved  medical
  assistance  fee  schedules  by  payment  to  such  county  or city which
  furnished the care, services or supplies either directly or by contract.
  Notwithstanding any  provisions  of  law,  rule  or  regulation  to  the
  contrary,  any  clinic or diagnostic and treatment center licensed under
  article twenty-eight of the public health law, which  as  determined  by
  the  state  education  department, in conjunction with the department of
  health, has a less than  arms  length  relationship  with  the  provider
  approved  under  section  forty-four  hundred  ten  of the education law
  shall, subject to the approval of the department and based on  standards
  developed  by  the  department,  be  authorized  to directly submit such
  claims for medical assistance, services or supplies so furnished for any
  period beginning on or after July first, nineteen hundred  ninety-seven.
  The  actual  full  cost  of  the  individualized education program (IEP)
  related services incurred by the clinic shall be  reported  on  the  New
  York  State  Consolidated  Fiscal  Report  in  the education law section
  forty-four hundred ten program cost  center  in  which  the  student  is
  placed  and  the associated medical assistance revenue shall be reported
  in the same manner.
    2. Claims for payment under this section shall be made  in  such  form
  and  manner,  at  such times, and for such periods as the department may
  require.
    The provisions of this section shall be of no force and effect  unless
  all  necessary  approvals  under  federal  law  and regulation have been
  obtained to receive federal financial  participation  in  the  costs  of
  health care services provided pursuant to this section.