Minnesota Association of County Social Service Administrators
Legislative Position
2008
Topic/Descriptive Title:
LCTS Disallowance: Minnesota's Counties/Collaboratives Owe $9,739,500
Brief Summary Statement:
In September 2006, the Federal Office of Inspector Generals (OIG) office released their final audit report regarding Local Collaborative Time Study (LCTS) school-based services claiming in Minnesota. The findings indicated that during State Fiscal Year 2004 (07/01/03 thru 06/30/04), Minnesota claimed a total of $44.9 million ($22.5 million Federal share) in Medicaid school?based administrative costs incurred by 340 school districts, 69 public health agencies, and 74 correction agencies. According to the report, the 340 school districts accounted for 89% of the total. The OIG reviewed 60 school districts as part of their audit. In total, those 60 districts claimed $26.8 million ($13.4 million Federal share). The findings of the report indicate that of the $26.8 million claimed by those 60 school districts reviewed, $7.3 million ($3.6 federal share) was allowable and $19.4 ($9.7 million Federal share) was UNALLOWABLE
Problem/Issue Statement:
In its report, the OIG recommended to the Center for Medicaid and Medicare Services (CMS) that Minnesota refund $9,739,500 plus any additional accrued interest to the federal government. CMS has reviewed, and concurred with, the OIG findings. At MACSSA's request, the Minnesota Department of Human Services has calculated the total possible "payback" to CMS. The 60 audited school districts are located in 44 of the 87 counties. The potential payback amounts range from $8,187 to $2,893,451 across the 44 counties, and the median payback amount per county would be $188,000.
Legislative Committee Action Proposed:
The Minnesota Department of Human Services has administratively appealed this CMS decision to the Departmental Appeals Board within the U.S. Department of Health and Human Services. The Minnesota Attorney General's Office is representing the state's Department of Human Services (DHS). We support DHS's appeal of this decision. In addition, MACSSA and should jointly draft legislation and seek authorization for the State to financially assume responsibility for any LCTS earned funds that will need to be paid back to the federal government. Prior to implementation of legislative changes, we ask that DHS assume financial responsibility for costs related to this payback if the appeal is not upheld.
Impact If Change Is Not Implemented:
Minnesota's 95 Family Services and Mental Health Collaboratives may be required to "payback" millions of dollars of LCTS income that was used to fund 1,013 early intervention and prevention programs that served thousands of Minnesota pre-school and school-aged children in need.
Contact People:
John Dinsmore, 218-998-8172
Kate Lerner, 651-224-3344
Ruth Krueger, 651-554-5618
Paul Fleissner, 507-287-2242
Minnesota Association of County Social Service Administrators
125 Charles Avenue
Saint Paul, MN 55103-2108
Phone: (651) 224-3344, Fax: (651) 224-6540
www.mncounties2.org/macssa
