Turlock Unified draws scrutiny for time teachers put in on Medi-Cal referrals

Turlock Unified School District became the focus of a federal probe after it submitted $3.4 million in claims for administrative time spent getting poor children to sign up for health care in the depths of the recession.

The review of 2010-11, which also targeted $2.1 million in claims by the Tulare County Office of Education, led to statewide changes in how schools can bill for Medi-Cal-related expenses. Payments of hundreds of millions of dollars to all California schools have been on hold for three years as state and federal counterparts negotiated a settlement.

A final determination issued this spring raised hopes that payments could resume this summer, starting with the 2011-12 school year, said Janice Holden, coordinator of the program for the Stanislaus County Office of Education and schools in Tuolumne, Amador, Calaveras and San Joaquin counties.

“I keep telling them, ‘Don’t give up. Keep using the program.’ But this has created a hole in their budgets, money they could have used to buy nursing time or bring more services to the schools,” Holden said.

The Centers for Medicare and Medicaid Services, a division of the U.S. Department of Health & Human Services, targeted Turlock’s claim as the largest in the state using a so-called quarterly time survey. Turlock Unified’s bills amounted to 2 percent of total claims submitted under the program from California that year, though the district serves only about 13,900, or 0.2 percent, of the state’s 6.2 million schoolchildren.

In November 2013 report, the federal agency, which goes by CMS, documented Turlock Unified and the Tulare county office were asking staff to do extra duties during the time survey week, minutes that were then multiplied across the quarter as if they happened every week.

A third investigation cleared charges from special education services in Santa Barbara County. Staff there billed for duties they performed every week, said the report, titled “Financial Management Review of California’s School Based Administrative Claiming Program.”

Based on interviews with 29 Turlock time sheet submitters and administrators, the report says, “We concluded that staff within (Turlock Unified) were directed to perform activities during each time survey week that were outside their normal job duties in an effort to maximize reimbursement for the amount of (billable time) that could be claimed by TUSD.”

In the Turlock district, the report said, more than 300 classroom teachers submitted time sheets indicating they spent 15 percent of their time, or about an hour a day, performing what Holden described as basic marketing for Medi-Cal.

Teachers told The Modesto Bee they were to spend a few minutes each day that week talking to students, handing out fliers and speaking with any students who had questions about the program. They were told to note those minutes, plus time spent duplicating the fliers, time filling out the time sheets and time walking the paper sheets to the office, all in 15-minute increments.

They complained to their union about having to do it, Turlock Teachers Association President Julie Shipman said. “The district just kept saying we were doing such a great job, and it was helping us out tremendously during the economic downturn,” Shipman said.

It was money the state urged schools to go after, noting in a 2005 report that “school districts are still losing millions each year in federal reimbursements.” The state had 1.1 million school-aged children without health care in 2003, it noted, a quarter of them eligible for Medi-Cal, the state Medicaid program. The report estimated California left $53 million on the table in administrative reimbursement dollars in 2003.

Turlock has used the Medi-Cal Administrative Activities program for 15 years, at one point involving more than 600 teachers and staff members, said Dana Trevethan, incoming superintendent of Turlock Unified.

“The program was designed as an outreach program to provide critical Medi-Cal information to lower income and English learner families. We felt that we had a unique need in the Central Valley as we had a lack of medical providers, lack of information on medical issues with our families, and wanted to increase the services,” Trevethan said via email.

The MAA program worked, enrolling many new families, she said, “The MAA program was an outstanding program for TUSD as it brought funding for the schools and provided education and resources for families.”

The Turlock district was doing what the state had asked, Holden said. “They always worked really hard trying to get people into Medi-Cal. They do a good job,” she said.

In its audit report, the CMS declared California out of compliance with the program and demanded its money back for unsubstantiated claims citing lack of state oversight. It said it would completely deny Turlock’s claims, but later letters raised that to 25 percent, then 40 percent.

Trevethan said the district was paid under a revised submission and had not been asked to repay any of it. “Our understanding is that they are requiring us to revise the invoices for approval, with no request to pay back anything at this time, but the possibility of an overage being deducted moving forward as reportedly done with other (districts),” she said.

In a listing of Turlock claims and payments requested by The Bee, the billing for the second half of 2010-11 was $905,888, and the district was paid $674,325, or 74 percent, of that. Claims submitted, but not paid, for fiscal years 2012 through the first half of 2015 add up to $567,104.

In a letter sent in March, the state lays out a system of mostly partial payments that will be sent to schools – “maybe this summer, we’re hoping,” Holden said. The payments range from 40 percent to full payment for most claims less than $25,000.

The demands and rule changes have been “a huge mess,” Holden said. “This is particularly hard on the small districts who do not have the staff to put this together,” she said.

Following the CMS review, federal overseers changed the regulations to not allow classroom teachers to bill time for Medi-Cal referrals and applied it retroactively, said Don Gatti, SCOE deputy superintendent of business services.

“The feds wanted to change the rules halfway through the game, and that’s what Turlock got caught up in,” Gatti said.

“They wouldn’t accept California’s plan for doing reimbursements. Remember, we’re that big, 800-pound gorilla,” he said, referring to the state’s size. Of the 50 million students in public schools nationwide, almost 1 in 8 live in California.

The changes caught all districts by surprise, he said. “Out in the field everybody went, ‘Whoa! But this is what you told us to do.’”

The CMS review notes the state did not ask its program overseers to consider the reasonableness of times submitted, offer training in compliance issues or ask schools to submit a plan for services. Vendors used by districts to manage the complex paperwork inexplicably charged between $60 and $750 per staff member submitting time sheets, the report said.

It also advised the state, “in light of the magnitude of the findings identified in this report,” to improve training and create a process for employees to report possible fraud.

CMS gave the state until April 1 to implement a new method of calculating time, Gatti said. The new system uses a randomly selected moment of time, considered more statistically valid, and is administered by a single commercial vender for the state, he said.

The system still gives districts advance notice of when their “random moment” will be, Gatti said, “but this method is supposed to reduce the potential to game the system.”

The changes have meant school business offices statewide “have been doing a lot of legwork over the last 18 months,” Gatti said.

Looming on the horizon, however, are questions of whether school referrals remain an effective way to sign up families for Medi-Cal in the age of Covered California, the state’s health care exchange.

“Our feeling is the federal government isn’t sure how this will mesh with the Affordable Care Act,” Gatti said.

This story was originally published June 15, 2015 at 4:12 PM with the headline "Turlock Unified draws scrutiny for time teachers put in on Medi-Cal referrals."