Audit of Oklahoma Medicaid School-Based Services Provided Free to Other Students and Not Exempt Under the Individuals with Disabilities Education Act

EXECUTIVE SUMMARY:

The objective of this review was to determine whether school districts in Oklahoma billed Medicaid for school-based health services that were (1) provided free to other students, and (2) not exempt under the Individuals with Disabilities Education Act (IDEA). We found Oklahoma lacks procedures to ensure that health services billed under the non-IDEA system were not provided free to all students. Based on our review and additional documentation provided by the state after issuance of the draft report, the services provided to the 100 selected beneficiaries we reviewed were all incorrectly billed. Services for 97 of the beneficiaries were billed incorrectly because the services were provided free to other students and were not exempt under the IDEA program. The claims for the remaining three beneficiaries were billed incorrectly because these beneficiaries and services were IDEA eligible and should have been billed under the IDEA program. Based on a projection of the statistical sample, we estimated at least $1,902,390 in federal financial participation was for services not in compliance with federal guidelines and CMS policy. We recommended procedural improvements and a financial adjustment for the $1,092,390. We also recommended that Oklahoma review periods not covered in the audit period and make appropriate adjustments.