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May 8, 2007
 Review of Medicaid Reimbursement Rate
for School-Based Health Services in Maryland
In fiscal years 2002 through 2004, the State of Maryland received
overpayments totaling more than $65 million, using a Medicaid
reimbursement rate of $82 per service for school-based services.
However, the
state was unable to show the per-service rate was based on actual
cost of services. Maryland received reimbursements totaling over
$146.5 million for the three-year period, of which $73.2 million was
federal share. The Office of Inspector General (OIG), Department of
Health and Human Services audited Maryland to determine whether
Maryland's claims for Medicaid reimbursement for
school-based health services complied with the approved state plan
and federal requirements. OIG recommended that the state
agency:
- Refund the federal government $3.7 million for unallowable basic
education costs
- Determine the unallowable basic education costs included in
reimbursement for state fiscal year 2005 and make the refund
- Work with the Centers for Medicare and Medicaid Services and the
Department of Education in developing more accurate school-based
health services rates
After the draft report, the state agency agreed that the audit
report reflected education costs that are were not allowable and
that the applicable rates should be reduced.
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