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More schools tap Medicaid for cash

Spending of federal aid coming under scrutiny

Monday, February 24, 2003

By Eleanor Chute and Jane Elizabeth, Post-Gazette Education Writers

Little by little, some savvy school districts across Pennsylvania are discovering a new pot of money that they can tap in the time it takes to fill in some bubbles on a card.

Online Chart:
Medicaid windfall



The source is Medicaid reimbursement funds for "administrative claims." Under the law, if teachers, school nurses and other employees keep track of the time they spend helping Medicaid-eligible students with certain tasks, school districts can rack up quite a sum in reimbursements from the federal government.

Statewide, districts billed Medicaid last year for $26 million in such charges -- an increase of $11 million over the previous year. And while they have to share the pot with the state, districts still get about half that money.

The Pittsburgh Public Schools received about $2.5 million from the program last year.

"We were a little late on coming on board on this," said Rick Fellers, chief operations officer of the city school district. "For the last year-and-a-half, we've been making significant efforts."

Those efforts have meant that Milliones Middle School, for instance, can spend $6,550 to help start a Saturday morning tutoring program for 100 students. And Greenway Middle School has $2,010 to publish its yearbook.

"Some schools are more diligent than others" in filling out the necessary time cards, Fellers said. But overall, "the increase has been so tremendous" that it gave Pittsburgh one of the highest growth rates among urban school districts nationally in reimbursements last year, Fellers said.

The program has been around since 1994. But only 93 school districts, intermediate units, charter schools and approved private schools in Pennsylvania are participating. That's only about 14 percent of the 654 districts and other school units in the state.

Philadelphia received about $10 million last year, and recently had intensive training to learn how to get more.

Still, in Allegheny County, only a few districts make the effort.

"I think most of them think it's not worth their time," said Cathy Lynch of the Allegheny Intermediate Unit. She helps districts work through the maze of Medicaid regulations and paperwork.

But for Arsenal Middle School Principal Debra Rucki, the reimbursements are "a blessing." Her school generated $27,000 in just a three-month period, about $13,000 of which goes back to her school.

The money has meant a few more computers for the school, a bowling outing for a sixth-grade homeroom that won a reading contest, transportation for a school club to a University of Pittsburgh basketball game, and display boards for math and science projects -- things many students at the school could never afford. Nearly 90 percent of Arsenal students are from low-income families.

And the school has socked away some of the funds. "You always save money because you never know what will happen," said Rucki.

Spending scrutinized

With the infusion of new money has come new scrutiny on the way those funds are used, however. At last week's Pittsburgh school board meeting, board members questioned why two schools are using the money to pay for a yearbook and to hold a school carnival.

Fellers told the board that under state law, schools can use the funds "for any purpose ... for whatever their children need most."

But board President Darlene Harris objected to Fort Pitt Elementary School's plans to use $5,655 for the school's annual Fun Fair.

"This is one of our lowest-performing schools," she said. More than half of Fort Pitt's students scored in the lowest category on statewide math and reading tests last year.

The item was pulled from the board's agenda, not because of the board's questions but because of a scheduling conflict, according to Richard Mascari, the district's executive director for elementary schools.

"This will be revisited," he said.

Some other board members agreed that the money could be used for academic purposes, and Superintendent John Thompson suggested schools might use it for reading and math programs.

Harris also objected to Greenway Middle School's plans to use its funds for a yearbook.

However, Ernestine A. Reed, the district's executive director for middle schools, said yearbooks "are a student project" that can help learning.

"It's a teaching tool," Thompson agreed.

Still, Thompson said his staff would put together a suggested list of uses for Medicaid funds to help schools decide the best way to spend the money.

School officials in Pittsburgh and elsewhere also help employees figure out which expenses are eligible to be billed for reimbursement on their time cards, technically called "time studies."

While it might be tempting, those rules shouldn't be played fast and loose, said Chris Berdnik, the city school district's finance director. "Compliance is a really big issue," he said.

The forms need to be completed correctly, Berdnik said. "Any form that has abnormalities, we don't send on to the state."

Playing by the rules

The reimbursements work like this: If a school employee assists a student eligible for Medicaid with Medicaid-related services, the employee records the amount of time spent on that task. (Low-income or severely disabled students typically are Medicaid-eligible.)

Schools can't be reimbursed for teachers instructing a Medicaid-eligible child. But if the staff person provides Medicaid "outreach services" -- such as helping a family figure out which Medicaid services could help them -- the school can be reimbursed for the expense. For instance, any time spent by a school employee making sure that Medicaid-eligible students have their required immunizations can be logged in, Rucki noted.

She'll also bill Medicaid for the time she spent in a recent meeting with local hospital, health and school officials on a health partnership plan for Arsenal.

By the end of the year, she wants to reach $50,000 in reimbursements and she continues to study how to do it. Any school could do it, she said, but they're often stumped by "a lack of understanding and a lack of knowledge."

Besides these administrative reimbursements, nearly all districts in the state participate in another form of Medicaid reimbursement for "direct services." That money goes back into special education portions of school district budgets.

But schools have more flexibility in how to spend the administrative claims money.

Economic inspiration

Pennsylvania has contracted with Leader Services, a Luzerne County firm, since 1992 to administer the program for the state. Part of their service is a quality assurance review in which some districts are audited each year.

The firm, which also administers the program in several other states, has become busier lately, said George Schneider, executive vice president.

The poor economy means that "schools are looking anywhere they can to find money," said Schneider. "Business managers who weren't as aggressive as they could have been" are now insisting on the time studies from employees.

Schneider said some schools participate for as small a reimbursement as $1,000 to $2,000 a quarter. Others don't participate at all, sometimes because the staff resists doing more paperwork.

But once employees are trained in the program, paperwork isn't that much of a burden, said Lynch. "It's a bubble sheet," she said. "You fill in the bubbles."

Lynch said the Allegheny Intermediate Unit had tried the program earlier with some of its special education employees, but "the money generated just wasn't worth the time involved in filling out the forms."

In the fall, the AIU decided to try it again, this time with the early intervention program for children from birth to age 3. In that program, Lynch said, there is an opportunity to let parents know about Medicaid services and refer them, activities that are reimbursable.

"It really is a good way to make sure that people who need the services are getting them," said Pat Kennedy, AIU spokeswoman.

The first three months generated about $25,000, which will be funneled back into the early intervention program.

Eleanor Chute can be reached at echute@post-gazette.com or 412-263-1955; Jane Elizabeth can be reached at jelizabeth@post-gazette.com or 412-263-1510.

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