Medicaid Services for Children: Federal Revisions to Reporting Form Raise Many Questions

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Prepared by:
Jane Perkins and Kristi Olson
Child Health Law and Policy Project
National Health Law Program

October 18, 1999

The Health Care Financing Administration has issued a Dear State Medicaid Director letter revising EPSDT (Early and Periodic Screening, Diagnosis, and Treatment) reporting on the Form HCFA-416. Although the new form includes some new and helpful elements, the overall effect is to reduce the ability to track trends in preventive services for children.

On the positive side, the revised form contains some new elements:

On the negative side, the revised form, among other problems:

States are to use the revised form for the current fiscal year (October 1, 1998 through September 30, 1999), and the report is due on April 1, 2000. The revised reporting requirements will eventually be published in the HCFA State Medicaid Manual, § 2700.4. We are asking HCFA to review our concerns with the new form prior to issuing the new State Medicaid Manual provisions.

 

Purpose of the Form

Congress requires states annually to report to HCFA on the extent to which their EPSDT programs are reaching poor children. 42 U.S.C. §§ 1396a(a)(43)(D), 1396d(r). In addition, the Medicaid Act requires HCFA to set participation goals for each state's EPSDT program.(1) HCFA requires states to report the EPSDT information on the Form 416. According to HCFA, the information on this form serves dual purposes, to:

Thus, the Form 416 is the state's self-reported record of EPSDT compliance for a certain year. In the study, Children's Health Under Medicaid: A National Review of Early and Periodic Screening, Diagnosis, and Treatment, the National Health Law Program used the Form 416 to document that few children are getting the preventive medical services they need through EPSDT. The data contained in the Form 416 is critical in assessing the state's record of compliance over time, as well as in identifying areas needing targeted efforts. Clearly, the Form 416 is an essential document for child health advocates.

 

Discussion of the Changes

Age groupings

 

 

To date, the Form 416 has required states to use the following four age groupings when reporting EPSDT information: <1 year, 1-5 years, 6-14 years, and 15-20 years. The new form requires states to use seven age groupings:

<1

1-2

3-5

6-9

10-14

15-18

19-20

These additional age groupings are welcome and could be of great benefit. For example, such reporting can assist states with better targeting age-appropriate outreach activities to improve screening rates.

 

Determining a child's age group

Under the old form, the child's age grouping was determined by the child's age on March 31st of the federal fiscal year being reported. The new form instructs states to report the child's age as of September 30th of the fiscal year.

This is a very significant difference with negative ramifications for the accuracy of reporting. With the exception of children born on October 1st, all children and adolescents are two different ages during any one fiscal year. The reporting form, however, only allows for a child to be reported in one age category. If the child's advance in age causes the child to change age groups (e.g., from ages 15-18 to ages 19-20), then the state must assign the child to one of the two potential age groupings.

Under the old form, the method was to split the difference and to look at how old the child was on March 31st, the halfway point in the fiscal year. This meant that if a child were eligible for the full fiscal year, she would be placed in the age grouping in which she spent the majority of the year. The new form, however, looks at how old the child is on September 30th, the last day of the fiscal year. As a result, all children will be placed in the higher age group, even if they spent the majority of the year in the younger age grouping.

The ramifications will be significant. Suppose, for example, that an infant is born on August 1st and remains Medicaid-eligible for ten months. During the first fiscal year, the infant will be counted in the under age one group. However, beginning October 1st, the start of the new fiscal year, the infant will be counted in the age 1-2 group, even though he will be less than one during his entire period of eligibility. This is because the state looks not to how old the child actually is at the time of eligibility, but to how old the child will be on September 30th, the last day of the fiscal year.

This change will not only make it impossible to compare data collected before and after fiscal year 1999, but it also will overinflate the results. Because the recommended number of screens per year typically decreases as the child ages, the change in calculating age groupings will create an artificial increase in screening rates. For example, under the federal periodicity schedule, a child under age one is expected to receive a screen six times during one year. In contrast, a child between the ages of one and five (the old age grouping), is expected to receive 1.2 screens during one year. Thus, by placing the child in an older age grouping, the state can provide substantially fewer screens while still increasing its screening rates. The state thus increases its screening rates, but only at the expense of the child.

Exclusion of certain children

 

The old Form instructed states to exclude medically needy children from their reporting if the state did not offer EPSDT to the medically needy. The revised Form tells states to exclude the following additional groups: (1) children eligible only under an 1115 demonstration waiver as part of an expanded group for which the full complement of EPSDT services is not available; (2) undocumented aliens eligible only for emergency services; and (3) other groups "eligible for only limited services as part of their Medicaid eligibility (i.e., pregnancy-related services)." The revised form also points states to the instructions of the Form 2082 for determining the basis of eligibility.

We can envision some problems with this section, and advocates should obtain clarification from their states on which groups of eligible children are being counted. For instance, a state with an 1115 demonstration waiver should not be able to exclude any of the expansion groups of children unless there is an explicit waiver of EPSDT (e.g. Oregon). Also, the "other groups" catch-all could be abused. If an adolescent is pregnant, the federal law does not authorize the state to limit her to pregnancy-related services; rather, as an individual under age 21, she would be entitled to the full package of EPSDT benefits. In addition, HCFA should clarify the circumstances where children enrolled in state Children's Health Insurance Programs should be included on the reporting form. State CHIP programs need to be notified by HCFA of reporting requirements.

 

State periodicity schedules

The previous Form 416 used the screening schedule recommended by the American Academy of Pediatrics for measuring screening rates. On the revised form, states will report according to their own state-developed periodicity schedules.

This is one of the most troubling changes in the Form. First, the form does not acknowledge that, for immunizations, the state must use the schedule established by the Advisory Committee on Immunization Practices. More importantly, the change frustrates the very purpose of the form -- tracking patterns and projections for the nation, individual states, and geographic regions. Because each state can use a different periodicity schedule, comparison among states obviously is made more difficult. In addition, comparisons over time cannot be made. Since states may choose not to use the same periodicity schedule in and after fiscal year 1999 as in previous years, it will be difficult to determine the extent to which performance has improved or deteriorated. Individuals interested in comparing state and national performance over time will have to make their own separate calculations.

Unfortunately, this break down comes at a time when accurate comparisons are crucial. A number of studies have reported that EPSDT screening has declined in some Medicaid managed care programs, and advocates have repeatedly voiced concerns that managed care is creating a financial incentive to underserve. By eliminating the ability to track trends over time and across states, this change also impairs the ability to determine the effect of managed care on EPSDT screening.

When it amended EPSDT in 1989, Congress explicitly pointed states to the screening schedule set by the American Academy of Pediatrics. Advocates should be wary lest states and managed care organizations use the occasion of their Form 416 revision to press for periodicity schedules that do not reflect current child health practice as recommended by the AAP.

 

Reporting using CPT codes

The revised form adds a provision allowing states to use certain listed CPT codes or state-specific EPSDT codes as a proxy for the EPSDT screen. The listed codes are CPT-4 codes for preventive medical services; thus, sick visits or episodic visits are not to be reported unless an initial or periodic exam also was performed during the visit.

We assume this change was made to accommodate managed care organizations and states which are using the HCFA 1500 claim form. This claim form bases reporting on CPT codes and, along with its commercial counterpart, is increasingly being used by insurance companies. Managed care organizations have complained that EPSDT reporting asks them to submit data they do not ordinarily collect and adds to the cost of providing services.

Unfortunately, nothing in the CPT codes or on the Form 1500 reveals whether all five of the mandatory components of the EPSDT medical screen have been provided. (Federal law defines the medical screen to include: developmental assessment, unclothed physical examination, immunizations, laboratory tests, and health education).

With the change in the Form 416, the industry has won an important concession. HCFA has included the following proviso in the instructions for completing the revised Form: "Use of these proxy codes is for reporting purposes only. States must continue to ensure that all five age-appropriate elements of an EPSDT screen, as defined by law, are provided to EPSDT recipients." However, the literature is replete with examples of the inability of government purchasers to collect data, their failure to collect data, and their failure to use the data they have collected. Advocates should contact their states now (and repeatedly) to learn what steps will be taken to assure effective and routine monitoring of the five screening elements.

 

Screening ratio

The screening ratio indicates the extent to which EPSDT eligibles receive the number of initial and periodic screening services required by the state's periodicity schedule, adjusted by the proportion of the year for which they are Medicaid eligible. Using the previous reporting form, some states showed screening ratios in excess of 100 percent. The revised form says this should not happen: "Any data submitted which exceeds 100% will be reflected as 100% on the final report."

This change will certainly minimize the appearance of faulty data. Capping rates, however, is a poor substitute for careful verification. First, if reported rates of greater than 100 percent are inaccurate (as many undoubtedly are), there is no reason to presume that the actual rate is 100 percent. Instead, states should verify the accuracy of their data. And, second, there should be recognition that rates higher than 100 percent are possible.

For example, states may attempt to screen all children regardless of their length of eligibility. This type of effort recognizes that many EPSDT-eligible children have undiagnosed conditions and may not have been screened as frequently as they should have been in the past. In addition to aggressive screening, these states may seek to address the on-again, off-again eligibility of many Medicaid children which allows children to fall through the cracks. These states have the potential to achieve screening rates of greater than 100 percent. Consider the following hypothetical: a state's periodicity schedule calls for screenings once every two years for adolescents 19-20 years of age. Eight such adolescents are enrolled in a managed care plan in the state. Suppose the average period of eligibility for this age group is three months. Under the screening rate formula, eight adolescents each enrolled for three months is considered the equivalent of one teenager enrolled for twenty-four months. [8 teenagers × 3 months = 1 teenager × 24 months]. As a result, the plan would only need to screen one of the eight teenagers to achieve a screening rate of 100 percent. Suppose, however, that the state requires the managed care plan to screen each EPSDT-eligible child within 90 days of enrollment. If the plan is partially successful in following this requirement and manages to screen six of the eight teenagers, the plan would have a legitimate screening rate of 600 percent. This type of aggressive outreach should be the hallmark of managed care which, ideally, should save money not by cutting needed services but by identifying and treating conditions early on before the condition deteriorates. Capping screening rates at 100 percent fails to recognize this, and does children a disservice.

 

Vision and hearing assessments

The revised screening form eliminates reporting for vision and hearing assessments. The only mention of these important screening activities is a reminder to states to include vision and hearing referrals when reporting on total eligibles referred for corrective treatment.

It is not clear why these cells were eliminated. It could be because HCFA wanted to keep the screening form to a certain length. It could be because managed care plans were complaining about having to report this information because of the CPT coding. At any rate, HCFA has written off monitoring the provision of these two mandatory elements of the EPSDT screen -- and in so doing has made it more difficult for advocates to monitor EPSDT performance and possibly less likely that children will receive these screens.

 

Dental screening

The revised Form requires states to report additional information about the number of children who are receiving dental services. In addition to continuing to report the unduplicated number of children receiving any dental services, states must also report the unduplicated number the children: (1) receiving preventive dental services, using American Dental Association (ADA) codes; and (2) receiving dental treatment services, using ADA codes.

The lack of dental services is reaching epidemic proportions for many poor children on Medicaid. In a number of states, the situation has gotten so bad that litigation has been filed or is being contemplated. The inclusion of these additional cells on the reporting form could serve as an important reminder that children's access to preventive dental care and treatment services is a mandatory part of the EPSDT program and that states' performance in this area will increasingly be an area for federal monitoring and public inquiry. Nonetheless, it is not clear that the reporting gained by these two additional cells outweighs the loss of vision and hearing reporting.

 

Referrals for corrective treatment

The revised Form requires states to report the unduplicated number of individuals who were referred for further diagnostic or treatment services, including vision and hearing screens.

Previously, referrals for vision and hearing screens were not counted under the number of individuals receiving referrals. As a result of this change, it will be impossible to compare the number and percent of children receiving referrals before and after fiscal year 1999. In addition, the new reporting requirements do not explicitly prevent states from including referrals for dental care in this number. Since referrals for dental care should be included in the medical screen, the inclusion of this information would make the number of referrals fairly meaningless.

In addition, HCFA neglected the opportunity to include a specific line item about mental health referrals. This information would be of great use to advocates and researchers. Instead, such referrals are lumped together with all other conditions, making it impossible to track how many children are receiving mental health referrals.

 

Eligibles in managed care

The cell for reporting "continuing care arrangements" has been removed from the revised Form. The Form 416 now requires states to report all individuals eligible for EPSDT services in the state who are enrolled in managed care at any time during the reporting year. This reporting is included for "informational purposes only." Children in both capitated and primary care case management entities are to be reported.

Unfortunately, HCFA has missed an incredible opportunity to monitor managed care and fee-for-service performance. While the state must report the number of individuals enrolled in managed care, the report does not differentiate between managed care and fee-for-service enrollees. For example, the state does not require screening rates to be reported separately for managed care versus fee-for-service, which is critical information in determining which health care delivery arrangements are the most successful in providing preventive care. As recommended by the Office of Inspector General, "HCFA needs specific data to determine whether managed care is living up to its promise of access and care to children. . . ." Yet, HCFA has just forfeited such an opportunity.

 

Blood lead testing

The revised Form 416 requires states to enter the total number of screening blood lead tests furnished to eligible individuals under fee-for-service or managed care arrangements. Blood lead tests performed on persons who have been diagnosed with elevated lead levels or being treated for poisoning are not to be counted.

The addition of this cell has long been requested by the General Accounting Office, the National Health Law Program, and the Alliance to End Childhood Lead Poisoning. Reports from all of these organizations have repeatedly shown that, for the most part, state Medicaid agencies have not kept track of this mandatory element of the medical screen for children aged 12 and 24 months. Yet, despite the lack of data, many of these same states are considering asking HCFA to waive the requirement to test all Medicaid children. In states considering such a waiver, it is important to point out that HCFA has only now begun to require the state to collect and report the type of data that will allow it to verify whether EPSDT coverage of lead blood screening can appropriately be localized in target areas.

While the addition of this cell is important, it collects only the number of children screened without also asking for the number of children who are identified through the screen as having elevated lead blood levels. This information would provide invaluable epidemiological information and would be useful in verifying that children are receiving the follow-up care they need.

 

Conclusion

On balance, the changes to the Form 416 are immensely disappointing. While the additions of age groups and blood lead testing are positive changes, the revisions - on the whole - will probably not help the beneficiaries. If the goal is, as HCFA has said, to "ensure that children are given the best possible health care," then the uniform reporting form should have been revised to require more precise reporting. Far from an improvement, the changes in the new reporting form will render comparisons across time and across states virtually impossible and could result in overinflated results.

Because of our concern that the changes do not best meet the needs of low-income children, we strongly recommend that HCFA adopt the following steps:

These changes will improve the accuracy of the data, its usefulness to researchers, and the likelihood that children eligible for EPSDT will receive the services they need.

Despite the federal law's mandate of annual participation goals, HCFA has not updated participation goals since FY 1995, when the goal was 80 percent. See 42 U.S.C. § 1396d(r) (requiring annual participation goals). HCFA should have used this revision to update the goals and press states to provide increasing numbers of children with comprehensive preventive care. With managed care organizations now providing prepaid medical homes to increasing numbers of Medicaid-eligible children, comprehensive EPSDT screening should be improving and HCFA should be demanding this.
DEPARTMENT OF HEALTH & HUMAN SERVICES
Health Care Financing Administration
Center for Medicaid and State Operations
7500 Security Boulevard
Baltimore, MD 21244-1850

July 1999

 

Dear State Medicaid Director:

This letter is to transmit the revised Form HCFA-416, the annual reporting form for Early and Periodic Screening, Diagnostic and Treatment (EPSDT) services and accompanying instructions. This form was developed in consultation with the Medicaid/Maternal and Child Health Technical Advisory Group and was approved by the Office of Management and Budget on June 30. As you know, section 1902(a)(43) requires states to report annually to the Health Care Financing Administration (HCFA) certain data about the delivery of EPSDT services. We believe this new form will assist HCFA and states to capture more reliable EPSDT data in both fee-for-service and managed care settings.

The major changes to the form and instructions are

The old Form HCFA-416 expired on March 31, 1998. This new form should be used for reporting data for the current fiscal year (October 1, 1998 through September 30, 1999), which is due April 1, 2000. We are in the process of revising the appropriate sections of the State Medicaid Manual. If you have any questions regarding this information, please contact Teresa Gardner at (410) 786-3289 or Cindy Ruff at (410) 786-5916. Thank you for your attention to this matter.

Sincerely,

David S. Cade
Director
Family and Children's Health Programs Group

cc:

All HCFA Regional Administrators

All HCFA Associate Regional Administrators
for Medicaid and State Operations

Lee Partridge
Director, Health Policy Unit
American Public Human Services Association

Joy Wilson
Director, Health Committee
National Conference of State Legislatures

Matt Salo
Senior Health Policy Analyst
National Governors’ Association