Medicaid: Stronger Efforts Needed to Ensure Children's Access to 
Health Screening Services (13-JUL-01, GAO-01-749).		 
								 
The Early and Periodic Screening, Diagnostic, and Treatment	 
(EPSDT) Program  calls for states to provide children and	 
adolescents under age 21 with access to comprehensive, periodic  
evaluations of health, development, and nutritional status, as	 
well as vision, hearing, and dental services. There is concern	 
that state Medicaid programs are not doing an adequate job of	 
screening children for medical conditions or providing treatment 
for the children who need it. There is also concern about how	 
these services are faring under managed care plans. This report  
examines (1) the extent to which children in Medicaid are	 
receiving EPSDT services, (2) efforts that selected states are	 
taking to improve delivery of EPSDT services, particularly within
managed care, and (3) federal government efforts to ensure that  
state Medicaid programs provide covered EPSDT services. GAO found
that the extent to which children in Medicaid are receiving EPSDT
services are not fully known, but the available evidence	 
indicates that many are not receiving these services. A 	 
Department of Health and Human Services Office of Inspector	 
General study found that less than one-half of enrolled children 
in their sample received any EPSDT screens. GAO found that states
are taking actions to improve delivery of EPSDT services,	 
particularly within managed care. These actions include linking  
several state databases, publishing statistics that compare	 
performance, contracting with local health departments to	 
coordinate care for children, and mailing reminder letters to	 
parents. Federal efforts to ensure that children are receiving	 
services have largely focused on changing the state reports so	 
that they can collect reliable information about the extent of	 
the EPSDT screening.						 
-------------------------Indexing Terms------------------------- 
REPORTNUM:   GAO-01-749 					        
    ACCNO:   A01408						        
  TITLE:     Medicaid: Stronger Efforts Needed to Ensure Children's   
             Access to Health Screening Services                              
     DATE:   07/13/2001 
  SUBJECT:   Children						 
	     Data collection					 
	     Federal/state relations				 
	     Health care programs				 
	     Health care services				 
	     Managed health care				 
	     Reporting requirements				 
	     State-administered programs			 
	     California 					 
	     Connecticut					 
	     Early and Periodic Screening, Diagnosis,		 
	     and Treatment Program				 
								 
	     Florida						 
	     Medicaid Program					 
	     New York						 
	     Wisconsin						 

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GAO-01-749
     
Report to Congressional Requesters

United States General Accounting Office

GAO

July 2001 MEDICAID Stronger Efforts Needed to Ensure Children?s Access to
Health Screening Services

GAO- 01- 749

Page i GAO- 01- 749 Medicaid EPSDT Services Letter 1

Results in Brief 3 Background 4 Limited Available Data Indicate Many
Children Do Not Receive

EPSDT Services 9 States Have Taken Action to Improve Data Reporting and
Delivery

of EPSDT Services 15 HCFA Efforts to Ensure Children?s Access to EPSDT Have
Been

Limited 20 Conclusions 23 Recommendations for Executive Action 24 Agency
Comments 25

Appendix I Profiles of the Five States Visited 27

Appendix II Examples of State Actions Resulting From EPSDT Legal Settlement
Agreements 28

Appendix III Comments From the Centers for Medicare and Medicaid Services 31

Appendix IV Comments From the State of New York Department of Health 33

Appendix V GAO Contacts and Staff Acknowledgments 35

Tables

Table 1: Recommended Number of EPSDT Screens, by Age Group, for Selected
States 7 Table 2: Examples of State Initiatives to Improve Data 15 Table 3:
Examples of State Initiatives to Better Ensure Delivery of

Services 17 Contents

Page ii GAO- 01- 749 Medicaid EPSDT Services

Table 4: Examples of Initiatives to Improve Beneficiary Outreach and
Education 19 Table 5: Background on State and Medicaid Populations and State

Medicaid Managed Care Programs 27 Table 6: Description of Selected EPSDT-
Related Lawsuits and

Resulting State Actions to Improve the Provision of Services 28

Figure

Figure 1: Children in Medicaid as a Proportion of All Children, by Age
Group, 1998 5

Abbreviations

AAP American Academy of Pediatrics BBA Balanced Budget Act of 1997 CMS
Centers for Medicare and Medicaid Services EPSDT Early and Periodic
Screening, Diagnostic, and Treatment HCFA Health Care Financing
Administration HHS Department of Health and Human Services OBRA 89 Omnibus
Budget Reconciliation Act of 1989 SCHIP State Children?s Health Insurance
Program

Page 1 GAO- 01- 749 Medicaid EPSDT Services

July 13, 2001 The Honorable Henry A. Waxman Ranking Minority Member
Committee on Government Reform House of Representatives

The Honorable John D. Dingell Ranking Minority Member Committee on Energy
and Commerce House of Representatives

Medicaid, a joint federal and state program, finances health coverage for 21
million, or more than one in four, of the nation?s children. For many years,
one of its central services has been to screen children for various
conditions so that health problems can be found early and treated before
they worsen. This service, called Early and Periodic Screening, Diagnostic,
and Treatment (EPSDT), calls for states to provide children and adolescents
under age 21 with access to comprehensive, periodic evaluations of health,
developmental, and nutritional status, as well as vision, hearing, and
dental services. Despite the importance of these services, there is concern
that families are not sufficiently informed of benefits and that enrolled
children are not receiving them. In addition, the adequacy of state efforts
to ensure children?s access to these services has been challenged in court
cases throughout the country. These lawsuits have alleged that state
Medicaid programs are not doing an adequate job of screening children for
medical conditions or providing treatment for the children who need it.

An additional area of concern has been how these services are faring under
managed care plans. Increasingly, state Medicaid programs are contracting
with such plans to provide Medicaid- covered services, including EPSDT. In
many cases, states pay these plans a prepaid fee per Medicaid enrollee (a
?capitated? fee) to provide most medical services. Managed care plans have
traditionally placed an emphasis on preventive care as a way to provide
appropriate care in the most efficient setting, to avoid or correct health
problems before they become more acute or costly. However, Medicaid
beneficiaries in some arrangements are ?locked

in? to a particular plan for a period of time- and therefore are restricted
to receiving care solely from providers in that plan. This restriction in

United States General Accounting Office Washington, DC 20548

Page 2 GAO- 01- 749 Medicaid EPSDT Services

choice- together with concerns that the prepayment of capitated fees may
create incentives for health care providers to under- provide services to
maximize profit- has raised awareness of the need for assurance that managed
care plans provide required EPSDT services.

To better understand federal and state efforts to ensure that children in
Medicaid receive EPSDT services, you asked that we examine:

1. the extent to which children in Medicaid are receiving EPSDT services; 2.
efforts that selected states are taking to improve delivery of EPSDT

services, particularly within managed care; and 3. federal government
efforts to ensure that state Medicaid programs

provide covered EPSDT services. To assess the extent to which EPSDT services
were being provided, we reviewed state reports submitted to the Health Care
Financing Administration (HCFA), 1 the agency that administers Medicaid at
the federal level. We also reviewed major reports and studies on the
provision of EPSDT services. To assess actions or innovative practices that
states had in place or were implementing to provide EPSDT services, we
contacted selected states and visited five- California, Connecticut,
Florida, New York, and Wisconsin. We selected these states to represent
different regions of the country and because they had either relatively high
numbers of children in managed care or a reputation for having an innovative
EPSDT program, or both (see app. I for details on the states we visited). We
also reviewed several major legal settlement agreements and court orders to
identify examples of practices being put in place to respond to concerns
about access to EPSDT services. Finally, to determine what federal efforts
were under way, we reviewed documents and discussed EPSDT monitoring with
HCFA central and regional office representatives, and we obtained related
reports from reviews conducted since 1995. We conducted our work from
September 2000 through June 2001 in accordance with generally accepted
government auditing standards.

1 In June 2001, HCFA?s name was changed to the Centers for Medicare and
Medicaid Services (CMS). Since our fieldwork was conducted while the agency
was known as HCFA, we are referring to the agency in our report findings by
its former name.

Page 3 GAO- 01- 749 Medicaid EPSDT Services

The extent to which children in Medicaid across the country are receiving
EPSDT services is not fully known, but the available evidence indicates that
many are not receiving these services. A comprehensive view is not possible
because annual state reports to HCFA on the delivery of EPSDT services are
unreliable and incomplete, particularly for children in managed care. The
most reliable evidence comes from studies of specific EPSDT services, such
as lead screening or dental services, and reviews conducted in a handful of
states or covering the medical records of a relatively small number of
patients. For example, prior studies we have conducted of lead screening and
dental care nationwide found that most children in Medicaid do not receive
services, although they are at significantly higher risk than other
children. A Department of Health and Human Services (HHS) Office of
Inspector General study specific to managed care similarly found that less
than one- half of enrolled children in their sample received any EPSDT
screens. These and other studies have found that several factors contribute
to the lack of services. Some involve program issues, such as inadequate
systems for ensuring that services are provided. Others involve beneficiary
issues, such as parents? being unaware of the need for or availability of
covered services.

The five states we visited were taking actions to improve the compiling and
reporting of data to better monitor whether children were receiving
services. For example, Wisconsin is in the process of linking several state
databases to provide a more complete picture of the care being given to
individual children in multiple settings. As an incentive for managed care
plans to report all health screenings, New York publishes statistics that
compare the performance of these plans on child health- access measures such
as lead screening and well- child visits. The states were also acting to
better ensure that providers and managed care plans delivered required
services and to improve outreach and education to Medicaid children and
families in need of services. California, for example, requires health plans
to contract with local health departments to coordinate care for children,
and Florida mails reminder letters to parents when their children are due
for EPSDT screens.

Federal efforts to ensure that children are receiving services have focused
largely on changing the format and specificity of state reports so that they
can collect reliable information about the extent to which children are
being screened. While these efforts take a positive step, they do not
adequately address the difficulties that states face in obtaining
information about EPSDT service delivery, particularly in capitated managed
care settings in which payments are not directly tied to services provided.
Obtaining accurate data will require additional time and effort by states,
Results in Brief

Page 4 GAO- 01- 749 Medicaid EPSDT Services

plans, and providers. To identify areas for improvement, some HCFA regional
offices have worked with states to assess EPSDT activities. For example,
HCFA?s San Francisco Regional Office conducted a collaborative review with
California that helped identify such issues as gaps in informing
beneficiaries about EPSDT benefits. HCFA has in recent years conducted eight
studies in other regions or states that included any review of EPSDT, only
four of which focused exclusively on EPSDT. Although many of the actions
taken by one state to improve the delivery of services may apply to other
states, HCFA does not have mechanisms in place for identifying and
highlighting such actions. HCFA has recently signaled a renewed focus on
EPSDT, proposing that it expand its role in overseeing and promoting state
EPSDT activities. A specific plan for how HCFA- now called CMS- will
implement these efforts has not yet emerged.

We are recommending that CMS work with states to develop criteria and a
timetable for assessing and improving the reporting and provision of EPSDT
services. We are also recommending that CMS develop mechanisms for
identifying and highlighting practices that could be used as models for
other states. In commenting on a draft of this report, CMS generally
concurred with our recommendations that the agency work with states on these
criteria and time frames and develop mechanisms for sharing information
among states, but said improvement plans may not be needed for all states.
We clarified our recommendation to indicate that CMS should determine the
need for state improvement plans based on the outcome of a consistent
assessment of all states.

For more than 30 years, federal law has provided comprehensive health
coverage for low- income children through Medicaid. 2 The children eligible
for such care have made up a significant and growing portion of the nation?s
population, as eligibility for Medicaid benefits has expanded to cover
increasing numbers of previously uninsured children. In 1998, Medicaid
covered more than one- third of young children ages 0 through 5, and more
than one- fourth of children under age 21 (see figure 1). 3 The 21

2 Specifically, the Social Security Amendments of 1967 (P. L. 90- 248)
enacted the EPSDT benefit. 3 The Omnibus Budget Reconciliation Act of 1989
(P. L. 101- 239) required states to cover pregnant women and children under
age 6 in families with incomes at or below 133 percent of the federal
poverty level. The Omnibus Budget Reconciliation Act of 1990 (P. L. 101-
508) required states to phase in coverage (to 2002) of children ages 6
through 18 in families with incomes at or below 100 percent of the federal
poverty level. Background

Page 5 GAO- 01- 749 Medicaid EPSDT Services

million children covered by Medicaid that year composed slightly more than
half of the 41 million people in the program while the $32 billion spent for
their care was about 23 percent of the $142 billion spent on the program by
the federal government and states.

Figure 1: Children in Medicaid as a Proportion of All Children, by Age
Group, 1998

Source: HCFA.

An increasing number of children are also becoming eligible for EPSDT
services, as federal policy designed to cover the growing number of
uninsured children allows states to provide Medicaid services through the
federally supported State Children?s Health Insurance Program (SCHIP). To
implement SCHIP, states have the option of expanding their Medicaid
programs, developing separate SCHIP programs, or doing some combination of
both. If a state elects Medicaid expansion, it must offer the same
comprehensive benefit package, including EPSDT services, to SCHIP
beneficiaries as it does to Medicaid beneficiaries. In 2000, more than 1
million children were enrolled in SCHIP Medicaid expansion programs and were
therefore also eligible for EPSDT services.

0% 5%

10% 15%

20% 25%

30% 35%

40% 0- 5 years old 6- 14 years old 15- 20 years old All ages

Page 6 GAO- 01- 749 Medicaid EPSDT Services

Although many coverage, eligibility, and administrative decisions are left
to individual states, the federal government sets certain requirements for
state Medicaid programs. Coverage of screening and necessary treatment for
children is one of these requirements. EPSDT components are designed to
target health conditions and problems for which growing children are at
risk, including iron deficiency, obesity, lead poisoning, and dental
disease. They are also intended to detect and correct conditions that can
hinder a child?s learning and development, such as vision and hearing
problems. For many children, especially those with special needs because of
disabilities or chronic conditions, EPSDT is an important help in
identifying the need for essential medical and supportive services, and in
making these services available. 4

The federally required EPSDT components that constitute an EPSDT

?screen? include a comprehensive health and developmental history, a
comprehensive unclothed physical exam, appropriate immunizations, laboratory
tests (including a blood lead- level assessment), and health education. 5
Other required EPSDT services include

 vision services, including diagnosis, treatment, and eyeglasses;

 dental services, including relief of pain and infections, restoration, and
maintenance;

 hearing services, including diagnosis, treatment, and hearing aids; and

 services for other conditions discovered through screenings, regardless of
whether these services are typically covered by the state?s Medicaid plan
for other beneficiaries. 6

While state Medicaid programs must cover EPSDT, they have some flexibility
in determining the frequency and timing of screens. States develop, in
consultation with recognized medical and dental organizations, their own
?periodicity schedules,? which contain age- specific timetables that
identify when physical examinations and certain laboratory tests and

4 See Children with Disabilities: Medicaid Can Offer Important Benefits and
Services (GAO/ T- HEHS- 00- 152, July 12, 2000). 5 The required components
of EPSDT are found in Section 1905( r) of the Social Security Act (SSA). 6
Section 1905( r) of the Social Security Act requires that EPSDT include
services, described in section 1905( a), that are necessary to correct or
ameliorate defects and physical and mental illnesses and conditions
discovered through screening, whether or not those services are covered by
the state?s Medicaid plan. EPSDT Services Under

Medicaid Are Comprehensive

Page 7 GAO- 01- 749 Medicaid EPSDT Services

immunizations should occur. These tables vary somewhat from state to state.
For example, the number of recommended EPSDT screens ranged from 15 to 29
across the five states we visited (see table 1).

Table 1: Recommended Number of EPSDT Screens, by Age Group, for Selected
States Age Group

American Academy of

Pediatrics a California b

Fee- for Service California b

Managed Care Connecticut Florida New York Wisconsin

Less than 1868 8 8 66 1- 5 656 6 6 67 6- 14 7 2 7 7 9 c 5 4 15- 20 6 26 6 6
33

All ages 27 15 27 27 29 20 20

Note: Table is based on periodicity schedules effective as of January 2001.
a The number of screens recommended by the American Academy of Pediatrics
(AAP) is included for

reference. b California has separate periodicity schedules for fee- for-
service and managed care programs.

c Florida exceeds AAP guidelines because it recommends check- ups at ages 7
and 9 for at- risk children. Source: American Academy of Pediatrics and each
state?s Medicaid agency.

States have increasingly turned to managed care as a way to deliver Medicaid
services, including EPSDT. From 1991 to 1999, the proportion of all Medicaid
beneficiaries enrolled in managed care- either capitated or in primary care
case management models- rose from about 10 percent to about 56 percent. 7
Only two states do not have at least some Medicaid beneficiaries in managed
care plans.

Managed care, with its emphasis on preventive and primary care, is
philosophically an ideal model for delivering EPSDT- type services. Under a
capitated managed care model, states contract with managed care plans, such
as health maintenance organizations, and pay a fixed monthly fee per

7 This proportion represents the Medicaid population enrolled in capitated
plans and programs known as primary care case management models (PCCM). The
PCCM model is similar to a fee- for- service arrangement except that a
primary care provider is paid a monthly, per- capita case management fee to
coordinate care for beneficiaries. These programs are not included as part
of our managed care review, but they are included here because specific
calculations of Medicaid enrollees in capitated managed care over time were
not available at the time of our review. Compared to PCCM enrollment, about
five times as many beneficiaries are enrolled in capitated health plans. The
Growth of Medicaid

Managed Care

Page 8 GAO- 01- 749 Medicaid EPSDT Services

Medicaid enrollee (a capitated fee) to provide most medical services. 8 This
model, with its fixed prospective payment for a package of services, creates
an incentive for plans to provide preventive and primary care to reduce the
chance that beneficiaries will require more expensive treatment services in
the future. However, capitated managed care can also create a financial
incentive to underserve or deny beneficiaries access to needed care.
Moreover, Medicaid beneficiaries required to enroll in managed care may find
it difficult to seek alternative care if their plan providers fail to meet
their needs. Because of the potential to underserve, states must build in
safeguards and accountability measures, such as grievance and appeals
processes, to ensure that beneficiaries receive appropriate care. 9

The Congress has given states greater flexibility in moving Medicaid
beneficiaries into mandatory managed care plans. Before the Balanced Budget
Act (BBA) of 1997, a state could require Medicaid beneficiaries to enroll in
managed care only if it first obtained approval from HCFA to waive certain
statutory provisions, such as the freedom to choose providers. Under HCFA
waivers, states have implemented a variety of mandatory managed care
programs, ranging from programs serving limited populations in just a few
counties to state- wide programs covering all Medicaid beneficiaries,
including children with special needs. 10 The BBA gave states new
flexibility in implementing mandatory Medicaid managed care programs,
allowing them to implement programs through an amendment to their state
Medicaid plan without first obtaining a HCFA waiver. 11

8 States often ?carve out? services, such as dental, mental health, or
pharmacy, from their managed care benefit package. Providers of these
services are generally paid on a fee- forservice basis.

9 See Medicaid Managed Care: Challenge of Holding Plans Accountable Requires
Greater State Effort (GAO/ HEHS- 97- 86, May 16, 1997 ). 10 See Medicaid
Managed Care: Challenges in Implementing Safeguards for Children With
Special Needs (GAO/ HEHS- 00- 37, Mar. 3, 2000). 11 The BBA exempted certain
groups from mandatory enrollment through state plan amendments. These
include children with special health care needs, Indians who are members of
federally recognized tribes, and beneficiaries eligible for both Medicare
and Medicaid. States must still obtain HCFA waivers for mandatory managed
care enrollment of these populations.

Page 9 GAO- 01- 749 Medicaid EPSDT Services

The Omnibus Budget Reconciliation Act of 1989 (OBRA 89) made significant
changes to improve the provision of EPSDT services to children in Medicaid.
It required that the Secretary of HHS set statespecific annual goals for
children?s participation in EPSDT; mandated state- established periodicity
schedules for screening in dental, vision, and hearing services; required
blood lead assessments appropriate for age and risk factors; and imposed new
reporting requirements.

To fulfill the state- specific goal requirement, in 1990 HCFA set a
participation goal of 80 percent by 1995 for every state. To measure
progress towards participation goals and in accordance with the OBRA 89
requirement that states report certain EPSDT statistics, HCFA required,
starting in 1990, that states submit annual EPSDT reports (known as the form
416). The EPSDT report captures, by age group, the number of children who
(1) received EPSDT health screens; (2) were referred for corrective
treatment; (3) received dental treatment or preventive services; and (4)
were enrolled in managed care plans. Since fiscal year 1999, states also are
required to report the number of blood tests provided to screen children for
lead poisoning.

Lawsuits have been filed in many states alleging shortcomings in the
provision of EPSDT services. According to information from the National
Health Law Program, at least 28 states have been sued by beneficiaries or
advocates since 1995 for failing to provide required access to EPSDT
services. These lawsuits range from single- issue suits- such as coverage of
selected services including mental health services in Maine- to alleged
programwide failures and deficiencies in Texas, Tennessee, and Washington,
D. C. In several instances, the outcomes, including court orders and
settlements agreed to by both parties to remedy known concerns, illustrate
the difficulties states have encountered in providing services and also
suggest strategies to remedy established EPSDT deficiencies.

Despite statutory reporting requirements, reliable national data are not
available on the extent to which children in Medicaid are receiving EPSDT
services. However, a number of studies of limited scope indicate that many
children in Medicaid are not receiving EPSDT services. These studies also
show that several factors are at work in limiting the successful delivery of
EPSDT services. Some factors are program- related, such as a lack of
providers or systems to ensure access to covered services. Others are
related to beneficiaries themselves, such as the beneficiaries? lack of
States Are Required to

Report on the Delivery of EPSDT Services

Legal Settlements Highlight Challenges in Many States

Limited Available Data Indicate Many Children Do Not Receive EPSDT Services

Page 10 GAO- 01- 749 Medicaid EPSDT Services

awareness about the importance of preventive health care and about services
covered, or their difficulty in maintaining continuity of care with one
provider.

HCFA?s efforts to assemble reliable information about EPSDT participation in
each state have so far been unsuccessful. State- reported data, upon which
HCFA depends, are often not timely or accurate. For example, states were
required to submit their fiscal year 1999 reports by April 1, 2000. As of
January 2001, 15 states had not submitted their 1999 reports and another 15
states? reports had been returned by HCFA because they were deficient. HCFA
and state officials acknowledge long- standing difficulties that states face
in their efforts to collect complete and reliable data, which are used as
the basis for the EPSDT reports. These difficulties continue despite HCFA?s
attempts to improve the reliability of state EPSDT reports by revising the
report format and guidance.

One reason for the continued difficulty involves collecting data on EPSDT
services provided under managed care. Under the more traditional fee-
forservice approach, data on service delivery are often relatively easy to
collect as part of the payment process because states pay providers for each
service for which they bill the state. Under capitated managed care,
however, states pay the managed care plan a prospective monthly perenrollee
fee that is not tied to the individual services provided. As a result, data
on service utilization (often referred to as ?encounter data?) are not
necessarily captured. Instead, states have to rely on managed care plans to
collect and report these data separately. Managed care plans, particularly
those that also pay their participating providers on a capitated basis,
often have difficulty collecting and reporting complete and accurate data.

States face continuing challenges in determining how to minimize the
administrative burden on managed care plans and providers while still
collecting information at the level needed to administer the program. For
example, to facilitate the collection of EPSDT data, California uses a
special EPSDT form for providers to use in documenting the components of
EPSDT services provided. California?s managed care contracts also call for
managed care plans to collect the EPSDT forms from their providers and
submit detailed encounter data to the state. However, the state has had
difficulty enforcing these requirements across the several layers of
contractors involved in its managed care delivery system. For example, in
the Los Angeles area, the state contracts with two large managed care
organizations that subcontract with multiple commercial and nonprofit health
plans, such as Blue Cross, that further subcontract with a network Reliable
and

Comprehensive National Data Do Not Exist

Page 11 GAO- 01- 749 Medicaid EPSDT Services

of providers. Most of these contracts are on a capitated basis. State
officials said that some of the health plans had difficulty collecting the
required encounter data and that one plan had never submitted the required
data. Also, they said that capitated providers of health plans had little
incentive to fill out and submit the EPSDT form because their payments are
not linked to it. The state?s Medicaid agency has not imposed sanctions
against noncompliant plans or providers, restrained in part by its
reluctance to lose any providers given the shortage of providers willing to
serve children in Medicaid.

Although problems are more extensive with managed care data than with fee-
for- service data, most of the states we visited had some difficulty
obtaining complete and accurate data from fee- for- service providers as
well. Florida illustrates the kinds of difficulties that can be encountered.
Providers in Florida are required to use a specific EPSDT code and a claim
form to document the components of EPSDT services they provide. However,
according to state officials, providers often choose to use other codes
instead. For example, providers may submit a claim under a comprehensive
office- visit code for a new patient that pays a higher rate than an EPSDT
screen or they may submit claims under other comprehensive office- visit
codes that require less documentation. 12

Compounding these difficulties are limitations in claims processing systems
used by states for fee- for- service programs or by managed care plans. In
Florida, for example, if a child receives laboratory work from one provider
and the remaining components of a screening from another provider, some
managed care plans? data systems do not combine the services to correctly
reflect that a full screening for the child has been provided. Similarly,
some states have problems tracking referrals and follow- up treatment
services. This tracking difficulty may explain why, in

12 For example, under Florida?s current Medicaid fee schedule for
physicians, the payment rate for an EPSDT screen (code W9881) is $69. 12.
The payment rate for a comprehensive office visit of a new patient is $87.24
if it involves medical decision- making of high complexity (CPT code 99205)
and $69.12 if it involves medical decision- making of moderate complexity
(CPT code 99204).

Page 12 GAO- 01- 749 Medicaid EPSDT Services

HCFA?s 1998 compilation of state reports, seven states reported that no
children had been referred for corrective treatments. 13

While HCFA?s data cannot present a reliable and comprehensive picture of the
extent to which children in Medicaid receive EPSDT services, other studies
indicate that many of these children are not receiving such services. These
other studies have been narrow in scope, allowing analysts to overcome the
kinds of problems that so far have thwarted attempts to gather comprehensive
data. They have focused on specific EPSDT services or reviews of a sample of
patients? medical records. For example, in recent years we have conducted
reviews of screening rates for lead poisoning and dental care, basing our
analysis primarily on data from national health surveys. 14 Both studies
found low screening rates for these specific services among low- income
populations served by Medicaid. For lead poisoning, about 19 percent of
children in Medicaid aged 1 through 5 were screened- a serious concern,
because these children are almost five times more likely than others to have
a harmful blood lead level. The screening rate for potential dental problems
was similar, with about 21 percent of low- income children aged 2 to 5
having had a dental visit in the previous year. Older children fared
somewhat better, with 36 percent of low- income children aged 6 to 18 having
had a dental visit within the previous year.

Studies by others have shown similar results. A 1997 study by HHS? Office of
Inspector General, which examined a sample of 338 children?s medical records
from 12 health plans in 10 states, estimated that only 28 percent of

13 Determining whether children are receiving medically necessary treatment
services is an even more difficult proposition, as providers determine
appropriate medical treatment services based on the health condition of the
individual child. The federally required EPSDT reports do not require
information to track whether treatment services were provided or whether
referrals for treatment resulted in any provided services. Most states we
visited had no formal mechanisms for comprehensively tracking whether
referrals for treatment resulted in provided services. Instead, they relied
largely on small sample reviews of medical records to monitor whether
children were receiving needed treatment services.

14 Lead Poisoning: Federal Health Care Programs Are Not Effectively Reaching
At- Risk Children (GAO/ HEHS- 99- 18, Jan. 15, 1999), and Oral Health:
Dental Disease Is a Chronic Problem Among Low- Income Populations (GAO/
HEHS- 00- 72, Apr. 12, 2000). The first study used data from the National
Health and Nutrition Examination Survey, which is conducted by the National
Center for Health Statistics of the Centers for Disease Control and
Prevention. The study also used data from HCFA?s State Medicaid Research
Files. The second study used data from the Medical Expenditures Panel
Survey, which is conducted by the Agency for Healthcare Research and
Quality. Some Studies Show

Screening Rates Are Low

Page 13 GAO- 01- 749 Medicaid EPSDT Services

children enrolled in Medicaid managed care received all prescribed EPSDT
screens and that 60 percent received no screens at all. 15 In several
states, organizations responsible for external quality review of the
Medicaid program have conducted sample medical record reviews of children
enrolled in fee- for- service programs as well as those in managed care, and
they have found similar results. For example, a study by Minnesota?s
external quality review organization found that nearly half of the children
in managed care plans whose files were reviewed had not visited a clinic in
the previous year, and only 6 percent of those due for an EPSDT screen had
received a comprehensive screen. 16 A study in Washington State found that
for the sampled files of children in managed care, 32 percent of infants
(birth to 15 months) and 20 percent of children age 3 to 6 years received
screenings for all aspects of EPSDT. The screening rates for children in
fee- for- service care were also low- 7 percent for infants and 24 percent
for children age 3 to 6 years. 17

Studies such as those cited above have collectively identified a number of
reasons why many children in Medicaid are not receiving EPSDT services. Some
of these reasons involve program- related matters, such as limited provider
participation in Medicaid. For example, low provider participation in
Medicaid has been noted as a particular problem in dental and mental health.
Our earlier study found that a shortage of dentists willing to treat
Medicaid patients was the major factor contributing to the low use of dental
services. 18 Similarly, a study by the Economic and Social Research
Institute for the Kaiser Commission on Medicaid and the

15 Medicaid Managed Care and EPSDT, Office of the Inspector General, HHS
(OEI- 05- 9300290, May 1997). 16 1999 External Quality Review Study Child
and Teen Checkups Participation Rate Review Final Report, FMAS Corp. for the
Minnesota Department of Human Services, August 2000.

17 2000 EPSDT Report- External Review for Washington Medical Assistance
Administration, OMPRO. This study covered only those children who had 12
months or more continuous Medicaid eligibility- a longer period than the
average eligibility of Medicaid children. Screening rates for such children
are expected to be higher than rates for Medicaid children as a whole
because children who have been eligible for a longer time are more likely to
receive preventive care.

18 Our study defined ?substantial participation? in Medicaid as seeing 100
or more Medicaid patients a year- about 10 percent of a dentist?s normal
caseload. Thirty- one states provided information to us on the extent to
which their dentists participated in Medicaid. None of these states reported
that more than half of its dentists saw 100 or more Medicaid patients a
year; most states reported that fewer than one- fourth of their dentists did
so. Several Factors Contribute

to Children Not Receiving Services

Page 14 GAO- 01- 749 Medicaid EPSDT Services

Uninsured found shortages of mental health and substance abuse professionals
willing to treat Medicaid patients. 19

Other program- related factors include inadequate methods for ensuring
access to services. Our study of lead screening found problems with
providers? missing opportunities to perform follow- up tests when children
returned for other care. Lawsuits brought in a number of states have also
highlighted such problems as inadequate systems for informing beneficiaries
about the availability of EPSDT services and poor coordination by managed
care plans and state agencies. Several advocacy groups we interviewed echoed
concerns that states and managed care plans do not adequately inform
beneficiaries about the broad scope of EPSDT services or about beneficiary
appeal rights. These groups also questioned the adequacy of the provider
networks for serving children in Medicaid.

In addition to these program- related factors, some beneficiary- related
factors have also been found to limit screening services. For example, many
Medicaid beneficiaries change eligibility status over short periods of time,
and they may move frequently, making it more difficult to maintain
continuity in their medical care. 20 Researchers have also found that
parents whose children are eligible to receive services under Medicaid tend
to be less aware of the importance of preventive care than the general
population. Those who try to obtain preventive care face other barriers. In
our reports on oral health and screening for lead poisoning, we noted
several other contributing factors, such as difficulty in getting time off
from work, finding child care, arranging transportation to the provider, and
overcoming language differences. These factors may contribute to a higher
rate of broken appointments- a major concern among providers, particularly
dentists. An American Dental Association survey reported that about one-
third of Medicaid patients failed to keep appointments. A 1999 study
conducted for the Florida Medicaid agency found that the top three reasons
given by survey respondents for missing pediatric appointments were not
having a ride to the appointment, the child no longer being sick, and
forgetting an appointment.

19 Medicaid Managed Care for Persons with Disabilities: A Closer Look,
Marsha Regenstein and others, The Economic and Social Research Institute for
the Kaiser Commission on Medicaid and the Uninsured, April 2000.

20 For example, the average period of Medicaid eligibility reported by all
states combined was less than 9 months in 1998.

Page 15 GAO- 01- 749 Medicaid EPSDT Services

The five states we visited have implemented a variety of initiatives
intended to improve the provision of EPSDT services to children in Medicaid,
including those in managed care. The state and health plan efforts we
identified fall into three general categories: (1) improving data; (2)
better ensuring that plans deliver services; and (3) improving beneficiary
outreach and education. Although in most cases states and health plans could
not provide information on their specific impact, these initiatives
represented efforts that state and plan officials cited as helping to better
ensure that children receive EPSDT services.

The five states we visited have taken a number of steps to improve the
quality of the data they collect- especially from managed care programs- to
monitor the utilization of services and to compile EPSDT reports to HCFA.
These steps have not yet solved the states? data and reporting problems;
however, by moving toward more timely and reliable encounter data, states
can better assess progress toward participation goals, identify specific
plans or providers experiencing problems, and target corrective measures. As
table 2 shows, these steps involve four main types of actions: requiring
plans to submit detailed encounter data, validating those data, linking data
with other sources, and reporting summary data in print or on the Internet.
For example, to encourage health plans to report complete and accurate data,
and to publicize comparative data, New York publishes summary statistics on
individual plans on its health department Web site.

Table 2: Examples of State Initiatives to Improve Data Type of action
Description of initiatives

Submitting encounter data Some states have implemented systems and
requirements for health plans to submit data from each encounter with
patients. California, Connecticut, New York, and Wisconsin are states we
visited that require health plans to submit detailed encounter data,
including delivery of ESPDT services. Several officials told us that health
plans that pay their providers on a fee- for- service basis, although they
themselves are paid on a capitated basis, experience fewer problems with
their encounter data because the data are based on claims information.
Validating data A data validation process can provide information on the
limitations of reported data. All five

states we visited require annual external audits of health plan data.
California, for example, contracts with an external quality review
organization to develop baseline and annual assessments of health plans,
including EPSDT services such as immunizations and well child visits. These
external evaluations include a limited chart review, validating coding and
data entry, and audits of computer systems. Linking data from various
sources States can help close gaps in data on the provision of services by
linking databases and

information from numerous data sources. To ensure that the state has
complete data on the care provided to children in Medicaid, Connecticut and
Wisconsin are finding ways to link planreported encounter data with data
from various data sources, such as local health departments or other state
records. For example, as part of its new EPSDT encounter data system,
Wisconsin is in the process of linking its EPSDT database to other health
databases such as the statewide immunization registry and the lead screening
database.

States Have Taken Action to Improve Data Reporting and Delivery of EPSDT
Services

Improved Data Reporting

Page 16 GAO- 01- 749 Medicaid EPSDT Services

Type of action Description of initiatives

Publishing data How states use the data they collect can motivate health
plans to pay more attention to the quality of the data they gather and
submit to the state. New York, for example, publishes summary encounter
statistics- including several EPSDT measures such as well child visits and
lead screening- for each managed care plan on its health care Web site. This
report, Quality Assurance Reporting Requirements, allows plan- to- plan
comparisons. According to state and plan managers, such publicity is a
strong incentive for health plans to report complete and accurate encounter
data.

These states? experiences demonstrate that gathering complete and reliable
encounter data is a long- term effort. Wisconsin, for example, worked
collaboratively with capitated managed care plans for 4 years to formulate a
uniform encounter data set and reporting system that all plans are required
to use. Wisconsin?s system did not become functional until May 2000 and has
not yet produced its first report to HCFA. New York has required managed
care plans to submit encounter data for the past 6 years, but state Medicaid
officials said the first few years of data were unreliable. The data became
more reliable around the fourth year, after state officials worked with
health plans to improve their data collection and verification efforts. 21

States have also put into action a number of initiatives to help ensure that
managed care plans and health providers deliver screening and treatment
services to children enrolled in Medicaid. The broad package of benefits
offered under EPSDT can result in confusion and potential under- service if
health plans and providers are not clearly informed of their
responsibilities to provide EPSDT services. In California, for example,
officials said some health plans were not performing screens according to
the state?s managed care periodicity schedule. Plan providers were confused,
they said, because the state?s Medicaid fee- for- service periodicity
schedule called for fewer screens than its managed care periodicity schedule
(15 compared to 27) and physicians often served both fee- for- service and
managed care patients. In addition, a recent HCFAsponsored study of Medicaid
managed care contracts in more than three dozen states found that states
often fail to spell out the full range of

21 While officials told us the encounter data are now reliable, through 1999
New York did not report actual encounters in their annual report to HCFA
because health plans were categorized as ?continuing care providers? that
were assumed to provide full EPSDT screens. Their data were therefore
overstated. Officials expect to report actual managed care encounters in
their 2000 data submission. Ensuring Service Delivery

Page 17 GAO- 01- 749 Medicaid EPSDT Services

EPSDT services that plans are responsible for providing. 22 The study
concluded, among other things, that while states routinely expect managed
care plans to provide the full range of EPSDT service obligations, they do
not always explain in contracts what this means and may not require
contractors to educate beneficiaries about the benefit package offered under
EPSDT.

To better ensure EPSDT service delivery, the states we visited have taken
action in several areas (see table 3). Some of these actions have involved
states? laying out expectations for managed care plans or providers through
extensive specification of responsibilities in contracts or provider
education. Other actions have involved the monitoring of health plans, the
use of incentives and sanctions for provision of services, and requirements
for plans to coordinate care with public health departments. States have
also increased reimbursement rates for EPSDT services. For example, in 1995,
to encourage fee- for- service providers to screen more children, Florida
more than doubled its reimbursement rate for a comprehensive EPSDT screen.
The examples in table 3 represent a few of the promising actions these
states and health plans have implemented.

Table 3: Examples of State Initiatives to Better Ensure Delivery of Services
Type of action Description of initiatives

Detailed contract requirements Specific and comprehensive contract language
helps ensure that health plans know their responsibilities and can be held
accountable for delivering EPSDT services. Connecticut?s contract, for
example, contains three pages of specific EPSDT requirements, including
requirements for (1) EPSDT screens, (2) services such as scheduling
appointments, arranging transportation, and providing interpreters for
enrollees with limited English proficiency, and (3) coordinating with other
assistance programs, such as Head Start. The contract also contained a 27-
page appendix of EPSDT periodicity schedules and guidance. Provider
education Policies and procedures governing EPSDT, as well as the EPSDT
benefit package itself,

can vary substantially from the typical commercial policy. As a result,
provider education is an essential health plan activity. Florida conducts
provider training and outreach, including coverage of EPSDT services and
promotional materials, through 11 area EPSDT coordinators. Wisconsin holds
annual conferences for providers and others to discuss topics such as EPSDT
policies, processes, and barriers to providing services. Increased state
monitoring Monitoring of individual plan performance allows states to
identify the need for specific

corrective actions. New York uses encounter data to compare each health plan
to statewide averages and the plan?s own prior year performance. Plans
performing below statewide averages or showing decreased performance are
required to implement corrective actions that are monitored by the state to
ensure improvement. Connecticut established an independent Children?s Health
Council to, among other things, help

22 Final Report: Federal EPSDT Coverage Policy, The George Washington
University, Center for Health Services Research and Policy, December 2000.

Page 18 GAO- 01- 749 Medicaid EPSDT Services

Type of action Description of initiatives

monitor delivery of EPSDT services. The Council?s responsibilities include
operating a complaint hotline, analyzing health plan encounter data, and
publishing newsletters and reports on the delivery of EPSDT services. Use of
incentives and sanctions States can build incentives and sanctions into
contracts to help ensure that health plans

deliver EPSDT services. New York rewards plans that do better in providing
EPSDT services by assigning them a higher proportion of new enrollees who do
not make a specific choice when they enroll. Each year, Wisconsin recoups
payments for screens if health plans do not achieve an 80 percent screening
rate. State officials expect to recoup $1 million to $2 million per year
from plans that did not meet the 80 percent goal in 1998 and 1999. Required
contracts with local health departments Close coordination between public
health departments and Medicaid agencies can help

ensure continuous, efficient care for those who receive services from
different providers. To better coordinate care, California requires health
plans to subcontract with the local health department in each county for
public health services, including immunizations and other EPSDT services.
Similarly, New York requires health plans to have agreements with local
health departments and to coordinate public health related activities, such
as outreach and reporting for immunizations. Increased provider
reimbursement Higher Medicaid fees can attract new providers or motivate
existing providers to see more

patients. In Florida, reimbursement for an EPSDT screen in the fee- for-
service program increased 116 percent in 1995 (from $30.00 to $64.82). After
the fee increase and other concurrent initiatives, such as provider
education, screening rates doubled- from 32 percent to 64 percent.

The third area in which states have taken action is in educating and
encouraging parents to better ensure that their children receive EPSDT
services. Beneficiary outreach and education is typically a responsibility
shared between the states and the health plans. At certain times in the
process, the states may have primary responsibility for informing
beneficiaries about covered services, such as when new beneficiaries are
enrolled. Once a beneficiary is enrolled in a health plan, the state may
require the plan to take measures to inform parents and families about
covered services and how to access them. Officials from states and plans we
visited reported a number of initiatives to better inform beneficiaries
about EPSDT services (see table 4). These generally fell into four
categories: designing clear and informative member handbooks, creating
helpful and easy- to- understand materials to supplement member handbooks,
developing programs to reach special populations such as children with
disabilities, and conducting community outreach activities. For example, to
encourage Medicaid beneficiaries, including those in managed care, to take
advantage of preventive care, Florida mails reminder letters to families
when their children are due for EPSDT screens. Improving Beneficiary

Outreach and Education

Page 19 GAO- 01- 749 Medicaid EPSDT Services

Table 4: Examples of Initiatives to Improve Beneficiary Outreach and
Education Type of action Description of initiatives

Designing member handbooks Member handbooks provide information on what
services are covered, how to access care, and what to do in the event of
questions or problems. One plan?s handbook in Wisconsin discussed the
importance of preventive care under HealthCheck, the state?s EPSDT program,
and listed the elements of an EPSDT screen that a beneficiary should expect
to receive, such as a physical exam, hearing and vision tests, and complete
immunizations. Creating additional informational materials States and health
plans produce a variety of special publications to supplement member

handbooks and promote health issues. For example, one plan in New York
distributes special calendars for expectant and new mothers. The calendars
provide useful information on what to expect during pregnancy, offer early-
childhood tips, and have space for recordkeeping and doctor appointments.
Florida sends reminder letters to all Medicaid enrollees, including those in
managed care who are due for EPSDT screenings. Florida also created a ?Child
Health Checkup? card for families? use in tracking scheduled EPSDT
screenings, similar to what a family might use to track a child?s
immunizations. Reaching special populations Health plans use a variety of
initiatives to reach special populations. For example, most

plans we visited publish outreach material in foreign languages to reach
non- Englishspeaking members. To attract adolescent members- another
difficult group to reach- one plan in Wisconsin operates teen clinics that
offer free pizza and gift certificates. New York awards grants to health
plans to develop innovative delivery models. Grants for 2001 included
initiatives to improve screening tools and treatment of children with
disabilities. Conducting community outreach activities Health plans conduct
a variety of activities to promote health issues, including EPSDT

services, in their communities. For example, one managed care plan in
California created community advisory committees that include health plan
members, advocates, and providers in an effort to facilitate communications
with members and strengthen ties within the community. In Connecticut, one
health plan conducts home visits, obtaining neighborhood and community
assistance in connecting with families.

In addition to these efforts in the five states we visited, children?s
advocates also informed us that several states have implemented initiatives
as part of settlement agreements arising from EPSDT- related lawsuits.
Settlement documents and court orders from selected EPSDT lawsuits contain
information on a number of state initiatives to improve delivery of EPSDT
services. For example, Pennsylvania established a series of 18 performance
standards and health outcome measures and incorporated them into managed
care contracts. Standards and interim targets were established for the
percentage of children to receive immunizations and EPSDT screens, and
measures were established for treatment and prevention of asthma, anemia,
and lead poisoning. Appendix II contains further information on the basis
for selected lawsuits and actions taken by states in response.

Page 20 GAO- 01- 749 Medicaid EPSDT Services

HCFA, now called CMS, is currently reevaluating how best to carry out its
role in helping to ensure that children receive access to EPSDT services. In
recent years, HCFA?s efforts have focused largely on trying to improve the
guidance to states about reporting the extent to which children are being
screened. Attempts to improve reporting have been time- consuming, and
progress has been slow. Because HCFA?s focus has been mainly on improving
the format and specificity of the state EPSDT reports, it has placed little
emphasis on the extent to which states are improving the underlying data or
meeting HCFA?s EPSDT participation goals. At the regional office level,
where much of the responsibility for working with states resides, a few
offices have begun to help states identify problems and promote state
progress in increasing children?s use of services. However, because most
regional offices have focused their resources on priorities other than
EPSDT, these efforts have not been widespread. In January 2001, HCFA?s
central office proposed to regional offices and other stakeholders that the
agency work more closely with states to improve both reporting and
children?s use of services, but a specific plan for how to do so has not yet
been developed.

Recognizing that progress in providing services is difficult to assess
without good data as a starting point, HCFA has centered its monitoring
efforts largely on revising the guidance and format in order to improve
state EPSDT reports. These revisions were largely aimed at capturing more
reliable and more consistent EPSDT information while minimizing the burden
on states in completing the reports. For example, in 1999 HCFA changed the
EPSDT report to, among other revisions, require new information on dental
services and blood lead tests, and to add more precise definitions of
certain required data elements. It also allowed states to use their own
periodicity schedules to determine their participation and screening rates.

While these revisions have changed the reporting requirements, they have
done little to address the continuing difficulties states face in their
efforts to gather reliable and complete data. As our review of the five
states showed, these problems require determined efforts at the state level,
and because of the complexities associated with collecting managed care
encounter data, such efforts take considerable time to accomplish. In the
meantime, these EPSDT reports do not provide an accurate or complete picture
of most state EPSDT programs, nor do they allow for reasonable national
estimates of EPSDT screening and participation rates or for meaningful
comparisons between states. HCFA Efforts to

Ensure Children?s Access to EPSDT Have Been Limited

HCFA Is Acting to Improve State Reports, but Progress in Improving the
Underlying Data Is Slow

Page 21 GAO- 01- 749 Medicaid EPSDT Services

Although HCFA?s efforts to improve data collection are important, by
themselves they do not represent a strategy for helping states meet EPSDT
goals. In part because HCFA acknowledges the limitations of the state EPSDT
reports, the agency has done little to address how well states are doing in
meeting the goal of providing EPSDT services to 80 percent of children
enrolled in Medicaid. The existing reports show that most states are
considerably below this goal. However, even if issues regarding data and
reporting are adequately addressed, improved EPSDT reports, taken alone,
will not provide HCFA with sufficient program detail to perform other
oversight duties, such as helping states identify and correct specific
problems or share information on lessons learned from other states and model
state practices.

A few HCFA regional offices have conducted reviews of state EPSDT programs.
HCFA regional officials reported to us that eight such studies have been
completed since 1995. Four included EPSDT as one element of a broader review
of a state?s Medicaid managed care program; four focused exclusively on
EPSDT. While these EPSDT and managed care assessments varied widely in their
methodology and coverage of EPSDT issues, they have helped illuminate policy
and process concerns and innovative practices of states. They have also
identified needed actions to improve children?s access to EPSDT care. For
example:

 In Oklahoma, an EPSDT- focused study conducted jointly by HCFA?s Dallas
Regional Office and state Medicaid officials found several ways to increase
screening and improve the quality of data submitted. The team found that
providers relied on a review of a child?s medical chart to determine whether
an EPSDT screen was due- a step they generally took only when an office
visit occurred. As a result, children not visiting for other reasons were
often not screened. The study recommended that the state establish a system
to notify providers when children were due for screens. The study team also
found that Medicaid provider knowledge of EPSDT services varied widely, and
that many providers did not know about a monetary bonus the state offered to
those providers who increased, to 60 percent or more, the proportion of
eligible children who had EPSDT screens. To increase provider awareness, the
study team recommended that the state annually include a discussion of EPSDT
at provider education meetings.

 In California, an EPSDT- focused study conducted by HCFA?s San Francisco
Regional Office with the cooperation of state Medicaid officials found that
families of children in Medicaid were not being effectively informed about
the availability of services or how to gain access to them. Studies by Some
Regional

Offices Have Identified Areas for Improvement and Innovative Practices

Page 22 GAO- 01- 749 Medicaid EPSDT Services

State officials who responded to the report?s findings acknowledged the need
for a more cohesive effort to provide information about EPSDT services, and
they indicated that the state would work to ensure that systems are in place
to provide adequate information to families of children in Medicaid. The
same HCFA study also singled out commendable practices including state
efforts to coordinate care between Medicaid managed care plans and community
health providers such as county mental health centers.

 In Michigan, a review of the state?s Medicaid managed care program
conducted by HCFA?s Chicago Regional Office and others included an
assessment of certain EPSDT policies and processes. These included EPSDT-
covered services; processes and responsibilities for outreach, informing,
and providing transportation services to beneficiaries; provider access and
coordination; data reporting; and the achievement of screening goals. The
review contained observations such as problems the state was having in
collecting reliable data for the state EPSDT reports and differences in the
usefulness of health plan member handbooks for describing how beneficiaries
can obtain transportation services covered under EPSDT. Stated goals of the
review were to gather information that would be useful in improving access
and quality in the managed care program and to identify areas of innovation
and best practices that could be shared with other states.

While these assessments have helped those state programs that were reviewed
and have identified best practices that might be applicable to other states,
HCFA has reviewed only eight states since 1995 and has not established a
mechanism for sharing lessons learned or innovative practices already in
place among states. Since there is no HCFA requirement to periodically focus
on and promote EPSDT on the state level, the decision to do so resides with
management of each HCFA region. Most regions have not devoted resources to
actively monitor or promote EPSDT. Some regional office staff cited other
priority efforts, such as SCHIP, as diverting their resources. We found that
regions typically have one staff person designated as EPSDT Coordinator, but
with multiple responsibilities other than EPSDT.

Page 23 GAO- 01- 749 Medicaid EPSDT Services

HCFA has recently begun to reevaluate the adequacy of its role in EPSDT. In
a January 2001 letter to the agency?s regional offices, HCFA?s Director of
the Center for Medicaid and State Operations introduced a proposal to
broaden the agency?s role in promoting state EPSDT activities. In the
letter, the Director sought input to a proposal designed to assure
children?s access to services under the Medicaid program and to assist
states in addressing problems in the collection and reporting of state EPSDT
data.

HCFA officials told us that the goal of the letter was to obtain stakeholder
comments on what HCFA?s focus and direction should be. As of April 2001,
HCFA regional staff had reviewed and commented on the letter, as had
representatives from the American Academy of Pediatrics, officials from
HHS?s Health Resources and Services Administration, and the Maternal and
Child Health Technical Advisory Group (an advisory group made up of 6 to 10
state Medicaid directors). HCFA officials informed us that stakeholder
reaction to the proposed initiative had generally been positive. The current
chair of the Maternal and Child Health Technical Advisory Group told us that
the general tone of the letter represents a collaborative, partnership
approach that would provide for needed technical assistance while affording
the flexibility needed for states to address conditions and impediments
unique to each state.

It is too early to determine whether this initiative will move forward, what
form it will take, or what might result from it. The agency has not yet
established a plan or devoted resources to develop and implement this
proposal. HCFA officials said that they were continuing to solicit comments
and input from stakeholders to develop a plan and that decisions about
resources and implementation would depend on guidance and direction on
agency priorities.

More than a decade ago, the Congress passed legislative changes to help
ensure that millions of low- income children under Medicaid have access to
important health screening and treatment services. In the years since then,
the Congress has placed even more emphasis on providing a health care safety
net by expanding coverage to more and more children who do not have health
insurance. This safety net, however, cannot be considered fully in place
unless there are assurances that the covered health care services are
actually provided. Unfortunately, reported data are unreliable and
incomplete. They are inadequate for gauging Medicaid?s success in providing
screening, diagnostic, and treatment services to enrolled children.
Particularly for children served by managed care plans- a Recent HCFA
Proposal

Aims to Improve EPSDT Performance, but Specific Plan Is Not Yet Developed

Conclusions

Page 24 GAO- 01- 749 Medicaid EPSDT Services

growing segment of the population- current information does not allow a
thorough assessment of progress. However, the available information
indicates that many children are still not receiving health screening
services. Recognizing this concern, some states are taking a more active
role in identifying ways to reach the at- risk population served by
Medicaid.

HCFA, now called CMS, has recently indicated increased emphasis on EPSDT
services and can build on these state efforts in several ways while still
giving states the flexibility to administer the program. One way is to
continue the important task of working with states to improve the reporting
of information on service delivery. Many providers, plans, and states will
need to improve their reporting in the long- term so that there will be a
more accurate picture of how well they are doing in providing these
services, especially in a capitated managed care environment. In the short-
term, CMS can take action to obtain a better understanding of the many
different state policies and practices so it can work collaboratively with
states to improve data and reporting, monitor the provision of services, and
better inform and reach beneficiaries. In its position of setting federal
policy and assessing a broad array of state activities intended to help
reach at- risk Medicaid children, CMS can help build on successful efforts
by sharing successes among states and working with the many different
agencies and parties to ensure a coordinated approach to this care. By
signaling a broadening of its interest in state EPSDT efforts, the agency
has taken a positive first step. An important next step is for CMS to
develop a more specific plan and time frames for working with states to
assess their efforts and results in providing services to children in
Medicaid.

To strengthen the federal role in ensuring the delivery of EPSDT services
and to bring greater visibility to ways that states can better serve
children in Medicaid, we recommend that the Administrator of CMS:

 work with states to develop criteria and time frames for consistently
assessing and improving EPSDT reporting and the provision of services,
including requiring that states develop improvement plans as appropriate for
achieving the EPSDT goal of providing health services to children in
Medicaid; and

 develop a mechanism for sharing information among states on successful
state, plan, and provider practices for reaching children in Medicaid.
Recommendations for

Executive Action

Page 25 GAO- 01- 749 Medicaid EPSDT Services

We obtained comments on a draft of this report from CMS and the five states
we visited. CMS commented that, as noted in the draft report, the problem is
complex and not subject to an easy resolution (CMS?s comments are included
in app. III). CMS agreed that more could be done to work with states to help
ensure children?s access to services and compliance with federal
requirements and stated that the agency?s regional offices are already
starting to work with some states where problems exist. CMS partially agreed
with our recommendation that it work with states to develop criteria and
time frames for assessing and improving EPSDT reporting and the provision of
services, including developing state- specific improvement plans for
achieving EPSDT goals. While acknowledging the importance of working with
states to improve the provision of services, CMS indicated that it was not
certain that improvement plans for all states were necessary as part of this
effort. Because of the unreliability of EPSDT reports, we believe that a
more consistent assessment across all states is necessary to provide greater
insight into states? progress in achieving EPSDT goals. Depending on the
assessment outcomes, improvement plans may not be needed for every state. We
have clarified our recommendation accordingly. CMS agreed with our
recommendation that the agency do more to foster information sharing and
cooperation among states to improve EPSDT. The agency indicated that, as a
first step, it is planning several activities with states, foundations, and
others to promote the value of EPSDT services. The agency also provided
technical comments that we incorporated where appropriate.

California and Connecticut reviewed our findings concerning their state
programs and said they had no comments. Florida, New York, and Wisconsin
provided technical comments, which we incorporated where appropriate. New
York also commented that the draft did not acknowledge that compliance rates
with screening requirements are uniformly low, even for children not in
Medicaid, and stated that EPSDT expectations may not be realistic. While
some available reports, such as our past work on lead and dental screening,
do show low screening rates in the aggregate, these reports also show wide
variations among states. Because available data are insufficient to gauge
states? progress in providing EPSDT services, assessing whether the agency?s
80 percent screening goal is realistic is difficult. We anticipate that once
state EPSDT data are more reliable, CMS will be in a better position to
reevaluate whether the annual screening goals that it set more than a decade
ago are realistic and achievable. New York also commented that the
shortfalls in the provision of recommended levels of preventive health
services identified in the report apply to all children, not just those
served by Agency Comments

Page 26 GAO- 01- 749 Medicaid EPSDT Services

Medicaid. Rather than perform a comparative analysis of the provision of
services for children in Medicaid versus others, this report focused on the
provision of EPSDT services to children in Medicaid, which our past work, as
well as the work of others, has shown to be an at- risk population. New
York?s comments are included in appendix IV.

As arranged with your offices, unless you release its contents earlier, we
plan no further distribution of this report until 30 days after its issuance
date. At that time, we will send copies to the Secretary of Health and Human
Services; the Administrator of CMS; appropriate congressional committees;
and other interested parties.

If you or your staff have any questions about this report, please contact me
at (202) 512- 7118. Other contacts and major contributors are included in
appendix V.

Kathryn G. Allen Director, Health Care- Medicaid

and Private Health Insurance Issues

Appendix I: Profiles of the Five States Visited Page 27 GAO- 01- 749
Medicaid EPSDT Services

To obtain information about efforts states were taking to improve EPSDT
services, particularly within managed care, we visited five states. These
states- California, Connecticut, Florida, New York, and Wisconsin- were
selected to represent different regions of the country and because they had
relatively high numbers of children in managed care or a reputation for
having an innovative EPSDT program or both. These states differed greatly in
the size of their Medicaid populations and the number of participating
health plans. Table 5 contains background information on the states we
visited.

Table 5: Background on State and Medicaid Populations and State Medicaid
Managed Care Programs California Connecticut Florida New York Wisconsin

State population, 2000 33,871,648 3, 405,565 15,982,378 18,976,457 5,
363,675 Total Medicaid enrollment, 2000 a 5,036,768 320,617 1, 701,128
2,751,385 479,167 Proportion of Medicaid recipients under 21 years of age,
fiscal year 1998 b

51% 53% 56% 49% 54% Managed care enrollment, 2000 a, c 2,525,406 229,995 1,
016,641 691,422 211,185 Proportion of Medicaid population in managed care,
2000 a, c 50% 72% 60% 25% 44% Number of health plans participating in
Medicaid managed care, 2000 33 e 4 142914 Specific EPSDT screening goals
established in managed care contracts

None 80 percent annual screening rate 60 percent

screening rate for children 0- 5 years of

age and continuously enrolled for 8

months None 80 percent

screening rate per contract year

a As of June 30, 2000. b Fiscal year 1998 is the most recent year for which
these data are available. c The percentage of the Medicaid population
enrolled in managed care includes those enrolled in primary care case
management arrangements, as well as capitated managed care plans. d State
officials reported contracting with 42 entities to deliver health, dental,
and long- term care, and services to special populations. Thirty- three of
these contracts were for health care services. Sources: U. S. Census Bureau,
HCFA, and state Medicaid agencies.

Appendix I: Profiles of the Five States Visited

Appendix II: Examples of State Actions Resulting From EPSDT Legal Settlement
Agreements

Page 28 GAO- 01- 749 Medicaid EPSDT Services

Lawsuits have been filed in at least 28 states alleging the states had
failed to adequately provide EPSDT services. The seven cases summarized in
table 6 were suggested by the National Health Law Program?s Director of
Legal Affairs and other EPSDT advocates as examples of states that have
adopted innovative or promising EPSDT practices as a result of lawsuits. The
following information reflects our review of relevant court documents in
each of these cases and, in some instances, follow- up contacts with state
officials to obtain further information about the state?s efforts.

Table 6: Description of Selected EPSDT- Related Lawsuits and Resulting State
Actions to Improve the Provision of Services State Basis for Selected EPSDT
Lawsuits and Resulting State Actions

California (T. L. v. BELSHE, No. CV- S- 93- 1782 LKKPAN, E. D. Cal., 1995)

Promulgating State Regulations on EPSDT services Plaintiffs alleged that the
state had failed to provide prescribed EPSDT services. California
promulgated EPSDT requirements in state regulations to clarify additional
requirements for coverage for children beyond requirements for adult
Medicaid coverage spelled out in its state Medicaid plan. California

(EMILY Q. v. BELSHE, CV- 98- 4181- WDK, C. D. Cal., May 5, 1999)

Expanded Availability of EPSDT Mental Health Services Plaintiffs filed a
class action lawsuit alleging that the California Department of Health
Services had failed to offer Medicaid- enrolled children the full scope of
mental health services covered under EPSDT. Prior to the lawsuit, California
had been institutionalizing children with severe mental health needs. The
plaintiffs alleged that California had violated EPSDT notification and
access requirements by failing to advise the children and their families
about other noninstitutionalization options, such as Therapeutic Behavioral
Services (TBS), which is a type of mental health service for children that
involves having a trained, experienced staff person available on a one- on-
one basis to work with the troubled child in his or her home and community
throughout the child?s routine day. In their lawsuit, the plaintiffs argued
that a less disruptive, noninstitutional approach- such as TBS- is a
required EPSDT benefit.

The Court ruled that TBS ?could be considered as both preventive and
rehabilitative as contemplated by the [EPSDT] statute, and therefore, when
necessary should be a covered [state plan] benefit.? As a result of the
lawsuit, California is now required to offer noninstitutionalization or
?wraparound? services so that mentally ill children can receive treatment in
the community instead of being institutionalized.

Appendix II: Examples of State Actions Resulting From EPSDT Legal Settlement
Agreements

Appendix II: Examples of State Actions Resulting From EPSDT Legal Settlement
Agreements

Page 29 GAO- 01- 749 Medicaid EPSDT Services

State Basis for Selected EPSDT Lawsuits and Resulting State Actions

District of Columbia (SALAZAR v. DISTRICT OF COLUMBIA, No. CA- 93- 452, Jan.
25, 1999)

Appointment of a Court Monitor to Oversee Corrective Action Plaintiffs filed
numerous challenges against the District of Columbia alleging that the
District failed to provide Medicaid benefits, including access to EPSDT
services, to its residents. The lawsuit alleged that the District of
Columbia did not notify residents of EPSDT?s availability and that the
District failed to provide EPSDT services when requested.

In ordering relief, the court appointed a special monitor to oversee
implementation of the corrective action required by the court?s consent
decree. Other required actions include annual EPSDT training for all managed
care plans and physicians; establishment of an EPSDT telephone referral and
question hotline for providers and EPSDT recipients; interim participation
goals; and a Spanish EPSDT Helpline. Maine

(FRENCH v. CONCANNON, No. 97- CV24- B- C, D. Me, July 16, 1998)

Expanded Availability of EPSDT Mental and Behavioral Health Services
Plaintiffs alleged that Maine was failing to comply with EPSDT requirements
because the state was not apprising patients of the availability or
providing access to mental health services under its EPSDT program.

As a result of the lawsuit, Maine agreed to modify the EPSDT informational
materials given to parents and providers to include specific information
about screening and treatment services available to address behavioral
health needs. The state also agreed to provide case management for
behavioral and mental health needs, develop a resource directory, and
conduct additional provider education. Pennsylvania

(SCOTT v. SNIDER, No. 91- CV- 7080, E. D. Pa., Dec. 2, 1994)

Increased Outreach to New Mothers and Setting Performance Standards The
plaintiffs alleged that Pennsylvania failed to properly implement the EPSDT
program. The parties negotiated a consent order that required, among other
things, that the state foster awareness of and access to EPSDT services, in
part by requiring the state to have a mechanism to ensure that all new
mothers meet with a primary care physician for their newborns. Pennsylvania
established a series of 18 performance standards and health outcome measures
and incorporated them into managed care contracts. Standards and interim
targets were established for the percentage of children who received
immunizations and EPSDT screens, and measures were established for treatment
or prevention of asthma, anemia, and lead poisoning.

Appendix II: Examples of State Actions Resulting From EPSDT Legal Settlement
Agreements

Page 30 GAO- 01- 749 Medicaid EPSDT Services

State Basis for Selected EPSDT Lawsuits and Resulting State Actions

Tennessee (JOHN B. v. MENKE, No. 3- 98- 0168, M. D. Tenn., Feb. 25, 1998)

Bonus Payment for Reporting Completed EPSDT Screens The plaintiffs filed a
class action on behalf of all individuals under the age of 21 in Tennessee?s
Medicaid managed care program. The lawsuit alleged that the state had failed
to properly screen children in accordance with the required EPSDT
periodicity schedules, properly diagnose children?s medical needs, or
provide children with access to the full range of required EPSDT health care
services.

The parties negotiated a consent order, agreeing to take a series of steps
to bring Tennessee?s Medicaid managed care program into compliance with
EPSDT requirements as set forth in federal statute, regulations, and
controlling HCFA guidelines. State officials told us that one of the results
has been that Tennessee and its largest managed health care plan have
developed a pilot project to document and encourage EPSDT screening by
providers. The health plan has developed a simplified one- page EPSDT form
that reduces the components into an 11- element checklist; for each
completed EPSDT form- and thus EPSDT screen- a provider receives a monetary
bonus. West Virginia

(SANDERS v. LEWIS, No. 2: 92- 0353, S. D. W. Va., March 1, 1995)

Increased Outreach to Ensure Behavioral and Mental Health Services are
Provided Plaintiffs filed a class action lawsuit alleging that out- of-
home- placement children were not being provided with access to mental
health services under the state?s EPSDT program.

Under the resulting consent order negotiated by the parties, West Virginia
agreed to ensure that all appropriate state employees, foster care parents,
and EPSDT providers received information and training on the
disproportionate number of mental health problems experienced by these
children. In addition, the state is required to ensure that EPSDT screens
and treatment for this population include behavioral and mental health
services.

Appendix III: Comments From the Centers for Medicare and Medicaid Services

Page 31 GAO- 01- 749 Medicaid EPSDT Services

Appendix III: Comments From the Centers for Medicare and Medicaid Services

Appendix III: Comments From the Centers for Medicare and Medicaid Services

Page 32 GAO- 01- 749 Medicaid EPSDT Services

Appendix IV: Comments From the State of New York Department of Health

Page 33 GAO- 01- 749 Medicaid EPSDT Services

Appendix IV: Comments From the State of New York Department of Health

Appendix IV: Comments From the State of New York Department of Health

Page 34 GAO- 01- 749 Medicaid EPSDT Services

Appendix V: GAO Contacts and Staff Acknowledgments

Page 35 GAO- 01- 749 Medicaid EPSDT Services

Katherine Iritani, (206) 287- 4820 Terry Saiki, (206) 287- 4819

Other major contributors to this report were Matthew Byer, Bruce Greenstein,
Sophia Ku, Behn Miller, and Stan Stenersen. Appendix V: GAO Contacts and
Staff

Acknowledgments GAO Contacts Staff Acknowledgments

(290002)

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