AppId is over the quota
State Health Department data from 2006 to 2010 show that education-related claims by the city were 60 percent lower last year than they were five years ago. And virtually all of the $302 million in Medicaid reimbursements the city did receive during that period were for administrative claims that, under the rules that took effect in September 2009, are no longer eligible for reimbursement.
New York, where more than two-thirds of the 168,000 special-needs students are poor enough to qualify for Medicaid, has lagged far behind the state’s other large school districts in filing claims. In fact, the city’s Education Department filed no claims related to nursing services, occupational and physical therapy, psychological counseling, audiological evaluations or transportation between 2006 and 2010; meanwhile, Buffalo, Rochester, Syracuse and Yonkers — where the combined special education populations are less than 10 percent of New York City’s — were reimbursed $77 million for such services.
The city’s Education Department did not try to file thousands of claims in the 16 months immediately after the new rules were announced, the state records show. A spokeswoman said it was because the department lacked the staff and the training to handle the more demanding requirements. (Data for 2011 was not available.) Claims can be filed for up to 24 months after the service is provided, but much of the required material cannot be retroactively documented.
“The Medicaid reimbursement process has become increasingly cumbersome,” the spokeswoman, Barbara Morgan, said.
Ms. Morgan said a city analysis found that the Education Department did not have proper documentation for all but 9,000 students during the 2007-8 and 2008-9 school years, a period covered retroactively by the new rules. The analysis shows, however, that even for those students, almost 20 percent of the $10 million in claims filed were rejected for not meeting the new criteria.
In September, for the first time since 1988, when Congress allowed school districts to file for Medicaid reimbursements, the city put a manager in charge of handling the claims exclusively, one of several recent changes intended to improve collections.
“We aggressively pursue reimbursements,” Ms. Morgan said, “and are working towards a long-term, streamlined solution that will allow us to receive money available to our students.”
The new rules are part of a settlement in which New York City agreed to repay the federal government $100 million — and the state $332 million — after a 2005 audit unearthed myriad irregularities in its claims. They require school districts to file claims much as medical clinics do. For example, doctor’s orders must accompany individual claims, and districts must use specific codes for the types of services they provide. In addition, therapists are now required to hold higher levels of certification — levels which half of New York City’s speech teachers lack — and districts must provide annual training, and hire compliance officers.
Other school districts are also struggling. Since counseling sessions led by guidance counselors and social workers are no longer eligible for reimbursement, Syracuse recently hired two licensed therapists, at a cost of $250,000. Even so, the district has been able to file only about one-quarter of the claims it once did, its chief financial officer, Suzanne Slack, said.
“The new regulations nearly crippled us,” Ms. Slack said.
But at a time of tight budgets and grim economic forecasts, many districts and states — each with its own set of filing rules — have invested heavily in compliance. Bruce Hunter, associate executive director for policy at the American Association of School Administrators, said the reimbursements, generally from 50 percent to 70 percent of the cost of a service, had become “an enormous help to school districts” across the country.
In New Jersey, where the state treasury retains 65 percent of the reimbursements, filing the claims has been mandatory since 2008, and the state has set precise goals for its districts, including a 90 percent return rate on forms giving parental permission for schools to file on a child’s behalf. In Washington, Mayor Vincent C. Gray asked the accounting firm Deloitte in February to suggest, among other things, ways to improve the system used by local schools to apply for reimbursements.
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