Guess Which Agency May Be Forgoing Millions in Federal Dollars?

by Tom Yamachika, President, Tax Foundation Hawaii

One article that recently appeared in the Star-Advertiser was titled, “State forgoing millions in federal reimbursements.” The state agency referred to in that article was our Department of Education.

We have children from indigent families in our school system. Some of them, especially in special education, can and do benefit when they receive services from health professionals. When that happens, the school can bill Medicaid for those services.

According to the article, many states have done this. In 2016, according to federal data, the average reimbursement that Medicaid sends to states was about $48 million. The federal data says Hawaii got around $0.26 million, but the DOE says the total is closer to $0.5 million. Which is one percent of what the average state receives.

As an example, one clinical psychologist’s report on the DOE system in 2006 noted that all students on Medicaid “are entitled to EPSDT (Early, Periodic Screening, Diagnosis and Treatment), a benefit that includes both a health screen and a mental health (social-emotional-behavioral) screen periodically between the ages of 0-21. This can be done in physician’s offices, or in some states, it can also be done by Public Health nurses, even within the school setting.” Catching psychological problems early in our student base is of course important so that they don’t later become complicated and costly, and if we can get Uncle Sam to pay for such services, so much the better for us locally.

When questioned, a DOE spokeswoman quoted in the article said that the Department is “aggressively going to seek reimbursement for every service and every eligible child that we’re able to. We are committed to doing that.”

But will they? It’s a lot of work going after Medicaid reimbursements. The services for which Medicaid is billed need to be deemed medically and educationally necessary, they need to be performed by a licensed provider, and they need to be properly documented. It’s hard for doctors and their own medical staffs to keep track of all this, and there are even specialized shops who claim to be proficient in medical coding, which is the way the medical professionals are supposed to tell the federal government what was done, why, and how much it cost. How do we expect schools, which aren’t in the medical business, to wade through all that federal government red tape? Obviously, this is a nut that the typical school with typical educators is not going to be able to crack easily.

Besides, under federal law the Legislature is supposed to be adequately funding special education, period, so it’s irrelevant whether the DOE seeks out federal dollars. It is very tempting for a DOE administrator to think, “There’s no benefit for us if we do all this work because the Legislature needs to fund us anyway. The only thing we can expect the Legislature to do if we get this money, is to reduce our general fund appropriation. Who needs that?”

Providing appropriate medical services isn’t within the expertise of a “typical” school, but these days we require our schools to go beyond simple education, especially in the special education realm. Because the DOE must, and does, provide these services, the DOE should have infrastructure to take advantage of federal benefits to pay for them. That would be helpful for us taxpayers, who are supposed to be whom the DOE is really working for. Let’s make sure they keep their word and go after whatever available monies there are.

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