Department of Health and Human Servces 

OFFICE OF


INSPECTOR GENERAL


EARLY and PERIODIC SCREENING,


DIAGNOSIS, AND TREATMENT (EPSDT) -­


PERFORMANCE MEASUREMENT


AUGUST 199 OEI-01-90130

EXECUTIVE SUMMAR Y


PUROSE 

To assess the accuracy of State reporting of Early and Periodic Screening, Diagnosis 

and Treatment (EPSDT) seIVces to Medicaid-eligible children. 

BACKGROUN 

The EPSDT program was established in 1961. The EPSDT is a comprehensive child 

health program that provides for initial and periodic examiations and medically 

necessary follow-up care. The program objective is to find and treat the problems 

discovered by the screening seIVces early, before they become more complex and 

costly to treat.


The Omnibus Budget Reconciliation Act of 1989 (OBRA 1989) expanded EPSDT 

coverage. Provisions effective April 1, 1990 mandated establishment of annual 

participation goals and reporting. In July 1990, the Health Care Financing 

Admnistration (HCFA) issued instructions to the State agencies that established an 

80 percent participation goal by the end of Fiscal Year (FY) 1995. The HCFA also 

established annual reportg requiements for the EPSDT program which replaced 

quarterly reporting by the States. The fist report was due April 1, 1991 for the six 

month period April 1, 1990 through September 30, 1990. 

When HCF A undertook implementation of OBRA 1989, the existing data system was 

inadequate to provide comprehensive data on screening. They began a major 

initiative to improve the measurement system. Recognizing the need to test the 

reporting formats, instructions, and data entry structures, HCF A decided to use the 

data from the first report that covered the last six months of FY 1990 to evaluate 

these changes. At the end of the first reporting period, HCFA formed a Work Group 

to analyze the reporting process. Based on this evaluation, this Work Group, whose 

efforts paralleled our own, is now considerig ways to improve the performance 

measurig system. 

METHODOWGY 

We obtained HCFA's instructions to States for reporting screening activities and 

participation rates. We randomly selected nie States for review, three each from the 

lower, middle, and higher participation levels. We obtained copies of these States 

reports for the period April 1, 1990 to September 30, 1990. We evaluated the 

methods prescribed for calculating screenig and participation ratios and assessed how 

well the sample States complied with instructions. 
FIINGS 

Th screening and partpant rati used to mee States' perormnce in the EPSDT 

program are esentill inccuate. 

Some States' EPSDT reportg is inonstent wih cuent HCF A intrtins. 

RECOMMATIONS 

Th HCFA shoul moif the metho by whih it meases screeng and partpatin 

rates so tht th co"ectly refct States' progres in meetig statury goals. 

Th HCFA shoul ennce moniorig proedes to ase the accuacy of States 

reportg. 

As noted previously, a HCFA Work Group is evaluating the EPSDT reporting system. We hope that the fidings and recommendations in this report will prove useful to the 

Work Group. 

AGENCY COMMNT 

The HCF A concurs with recommendations in the report, suggesting mior editorial 

changes. We have reviewed the report and made applicable modications. The full 

text of HCF A's comments are included in APPENDIX E of this report. 
INTRODUCTION


PUROSE 

To assess the accuracy of State reporting of Early and Periodic Screening, Diagnosis 

and Treatment (EPSDT) servces to Medicaid-eligible children. 

BACKGROUN 

RECENT PROGRA AMENDMENT 

Medicaid' s EPSDT program, established in the 1967 amendments to the Social 

Security Act, is a comprehensive child health program that provides for initial and 

periodic examinations and medically necessary follow-up care. The program objective 

is to fid and treat the problems discovered by the screening seIVces early, before 

they become more complex and costly to treat. 

The Omnibus Budget Reconciliation Act of 1989 (OBRA 1989) expanded EPSDT 

health coverage for most Medicaid-eligible children under age 21. Effective Apri 1 

1990, Medicaid programs must cover children through age five in famiies with 

income at or below 133 percent of the Federal Poverty Level (FPL) as established by 

the Department of Health and Human Servces (HHS). States that extended 

Medicaid coverage to all pregnant women and inants with incomes up to 185 percent 

of the FPL, prior to passage of OBRA 1989, must maintain that coverage. Also under 

OBRA 1990, States must phase in coverage of children under age 19 born after 

September 30, 1983, whose family income does not exceed 100 percent of the FPL. 

The OBRA 1989 amendments made changes to the Social Security Act. The following 

is now the structure of the EPSDT program. 

SERVIQ3: Secton 1905(r) 

Screenig servces which are provided at intervals which meet reasonable 

standards of medical and dental practice, as determined by the State after 

consultation with recognized medical and dental organizations involved in child 

health care and, at such other intervals indicated as medically necessary to 

determine the existence of certain physical or mental illnesses or conditions. 

These seIVces shall at a minimum include the followig: 

- a comprehensive health and developmental history (including 

assessment of both physical and mental health development); 

- a comprehensive unclothed physical examiation; 

- appropriate imunizations accordig to age and health history; 
- laboratory tests (including lead blood level assessment appropriate for 

age and risk factors); and 

- health education (including anticipatory gudance). 

Vision and hearg servces which are provided at intervals that meet 

reasonable standards of medical practice, as determined by the State after 

consultation with recognized medical organizations involved in child health care 

and at such other intervals as medically necessary to determine the existence of 

a suspected ilness or condition. Vision servces include, at a minimum: 

- diagnosis and treatment for defects in vision, including eyeglasses. 

Hearig seIVces include, at a minimum: 

- diagnosis and treatment for defects in hearig, including hearig aids. 

Dental servces which are provided at intervals that meet reasonable standards 

of dental practice, as determined by the State after consultation with recognized 

dental organizations involved in child health care, and at such other intervals as 

medicaly necessary to determine the existence of a suspected ilness or 

condition. Dental servces include, at a minium: 

- relief of pain and infections, restoration of teeth, and maintenance of 

dental health. 

The States must allow participation by providers who wish to furnsh only one 

(or more) but not all diagnostic and treatment servces. 

The Secretary shall not later than July 1, 1990, and every 12 months thereafter 

develop and set annual participation goals for each State for participation of 

individuals who are covered under the State plan under this title in EPSDT 

servces. 

The States must reimburse for diagnostic servces, treatment, and other 

measures described in section 1905(a) of the Act whether or not they are in the 

States' Medicaid plan. 

REPORTIG: Secton 190(a)(43) 

The State plan for medical assistance must provide for reporting to the 

Secretary (in a uniform form and manner established by the Secretary, by age 

group and by basis of eligibilty for medical assistance, and by no later than 
April 1 after the end of each fiscal year, beginning with Fiscal Year (FY) 1990) 

the following information relating to EPSDT seIVces provided under the plan during each fiscal year: 

(1)	 the number of children provided chid health screening servces; 

(2)	 the number of children referred for corrective treatment (the 

need for which is disclosed by such child health screening 

servces ); 

(3)	 the number of children receivig dental servces; and 

(4)	 the State s results in attaining the participation goals set for the 

State under section 1905(r) of the Act. 

EPSDT REPORTIG FORM 

The Health Care Financing Adminstration (HCF A) reporting instructions issued in 

July 1990 require each State to submit an annual report on EPSDT servces provided 

to children durig the previous Federal fiscal year. The Anual EPSDT Participation

Report, form HCFA-416, (Appendix A), which replaced the quarterly Form HCFA420, provides EPSDT participation information by age group and by basis of eligibilty 

(i.e., categorically-needy (CN) or medically-needy (MN)). Included in the report are: 

1) number eligible for EPSDT, 2) total number of eligibles enrolled in continuing care 

arrangements, 3) number of eligibles receivig screening seIVces, 4) total number of 

eligibles provided child health screening supeIVsion, 5) participant ratio, 6) total 

number of screening examinations, 7) screening ratio, 8) number of eligibles referred 

for corrective treatment, 9) number of eligibles receivig vision seIVces, 10) number of 

eligibles receivig preventive dental seIVces, and 11) number of eligibles receiving 

hearing seIVces. 

Enrollees in continuing care arrangements are identified separately in the report. 

Continuig care providers agree to provide continuous and comprehensive child health 

seIVces for EPSDT enrollees. 

The participant ratio (Line 5 of the form HCFA-416) is one measure of States 

progress in reachig their participation goals. The annual participant ratio is the 

unduplicated count of chidren provided health screening supervsion divided by the 

number of EPSDT -eligible children. The number of children provided health 

screening supervsion is the sum of those receiving screening servces and those 

enrolled in continuous care arrangements. 

The screening ratio (Line 7) is a second measure of participation. Following the 

instruction contained on the form, this ratio is determined by dividing the number of 

screening seIVces by the number of children eligible for EPSDT. 

When HCFA undertook implementation of OBRA 1989, the existing data system was 

inadequate to provide comprehensive data on screening. They began a major 

initiative to improve the measurement system. The HCF A recognized the need to test 
the reporting formats, instructions, and data entry structures. They decided to use the 

preliminary data from the first report that covered the last six months of FY 1990 to 

evaluate these changes. At the end of the first reporting period, HCF A formed a 

Work Group to analyze the reporting process. Based on this evaluation, this Work 

Group, whose efforts paralleled our own, is now considering ways to improve the 

performance measurig system. 

ANNUAL PARTICIPATION GOAL 

With instructions also issued in July 1990, the HHS set a yearly participation goal for 

each State, by the end of FY 1995, to screen at least 80 percent of EPSDT -eligible 

children and to provide at least 80 percent of screenings recommended for those 

children (Appendix B). The individual States' FY 1989 proxy participation ratios 

became their baselines for interi goals for FY 1991 to FY 1995. 

METHODOWGY 

We obtained HCF A's instructions to States for reporting screening activities and 

participation rates. We used HCFA's compilation of FY 1989 EPSDT participation 

rates by State to select the sample of nie States (Appendix B). We randomly 

selected nine States for review, three each from the lower (0 - 33 percent), 

middle (34 - 66 percent), and higher (67 - 100 percent) participation levels. 

We obtained copies of these States' reports for the period April 1 , 1990 to September 

, 1990. We evaluated the methods prescribed for calculating screening and 

participation ratios and assessed how well the sample States complied with 

instructions. 

Our review was conducted in accordance with the 
 Inter Standards for Insections 

issued by the President's Council on Integrity and Effciency. 
FINDINGS


TI SCRENG AN PARTICIAN RATIOS USED TO MEUR STATE' PERORMCE IN TI EPSDT PROGRA AR ESENY INACCTE. 

The numbers and rates of chidren paricipating in the EPSDT program, as reported on the form HCFA-416, are open to question, as are the ratios of screens those chidren receive. The form itself, the instructions, and the States' application of them lead to figues which are at best unreliable and at worst lead to inated screening and participant ratios. 


Th screeng rati miates th States' screening perormnce. 

The "Guidelies for Health SupeIVsion" of the American Academy of Pediatrics (AA) establishes an expected annual number of screenig seIVces. The guidelines are divided into four age groups: 

Under age one: five screens withi the year 

Ages one through five: seven screens with five years Ages six though foureen: five screens withi nie years, and 

Ages fieen through twenty: three screens within six years. 

States are not requied to use the AA periodicity schedule. Rather, a State may develop its own periodicity schedule in consultation with recogned medical and 

dental organitions involved in chid health care. We wi use the AA standard 

however, to ilustrate the problems that arise if the screenig ratio does not take into 

account the expected number of screens per year for each age group. 

The method used to calculate the screenig ratio on the form HCFA-416 neglects to take expected screens into account as HCF A intended by their manual instrction. The HCF A State Medicaid Manual, Part 5, Section 5360, descn"bes two methods to calculate the screening ratio of chidren receivig EPSDT servces. One method is the 

ratio of screenig seIVces to individuals eligible for EPSDT durg the period (Part 5

Sectiori 5360C.1. See also Section 5320.2D7 and Part 2, Section 2700.4). The second method is the ratio of screening servces to the number of EPSDT-eligible chidren reported for each age group multiplied by the number of screening servces expected for each age group member (Par 5, Section 5360C.5). Both methods of calculation 

use the same data but have different results. 

The form HCFA-416 uses the fist calculation method to determne the screening ratio 

as descn"bed in Part 2, Section 2700.4 of the State Medicaid Manual. This method 

misstates the actual screening ratio since the unduplicated count does not indicate how 

many scheduled screens a chid should receive, nor does it indicate for what length of 

tie chidren are Medicaid eligible and thus able to receive EPSDT screening seIVces 
under the established screening schedule. Since the ratio is calculated using the 

number of screens as the numerator, and the number of eligible children as the 

denominator, ratios can easily exceed 100 percent. Using this method necessitates 

additional adjustments to approximate the actual screenig ratios. It also creates 

confusion among policyakers as to States' actual performance in meeting EPSDT goals (Appendi C). 

Ths problem can best be demonstrated by focusing on State reporting of screenings for children under one year of age, where the number of AA recommended 

screenigs in one year (five) is highest. In our sample, four States reported screening ratios greater than 100 percent for chidren under one year of age. As an example

one State reported a screening ratio of 164 percent for children under one year of age. If the screenig ratio is adjusted to include the total number of screens 

recommended for this age group (five), assumig that each EPSDT-eligible should

receive all five screens, the resultant ratio is reduced to 33 percent for this State. 

The followig chart compares the screening ratio for children under age one reported 

by the sample States versus the adjusted screenig ratio as calculated by our offce. The adjusted screenig ratio results from factoring the expected number of screens for 

children under age one (i. , five) into the denominator of the ratio. 

REPORTED VS. USTED SCREEN I NGS


Ch i I d en Unde Age One


Per-cent age 200"' _.mm..........m.m..m.m...mmm...mm......m.mm.......mm..... .m.mm....mmm".........m"'.m.m"'..mm.....no


'16"1" 

150% -"".n_n__._un............-.---......---.......-.----....---nO"'h_____........--...........---------........---u......------......_----.....­


100% 

50"' 

0", 

States ' Screen i ng Rat i 0 

RQport.tid AdJ us't9d 

Reportd figues from th HCFA-416s as provi by th States 
Overall, the States in our sample reported a screenig ratio of 94 percent for children under age one. However, if the calculation included the total goal as the number of 

scheduled screens due for children under age one, the overall screening ratio would be 

19 percent.


Even this adjustment falls short in correctly stating the screening ratio as the number 

of eligible children who received all the screens they were scheduled to receive. This 

adjustment, like both formulas for the screenig ratio listed in the Medicaid manual 

fails to properly account for children who are eligible for only part of the year. 

such cases, error is introduced in the opposite direction, understating the true 

screening ratio as defied above. Using our example of children under age one, a child born late in the reporting year may be scheduled to receive only one or two 

screens, rather than five, yet the screenig ratio does not include this factor in its 

calculation. The end result is that the current method of reporting makes it difficult 

not impossible to ascertain the number of children who are receivig: 

all scheduled screenings


some of their scheduled screenings, or


none of the scheduled screenings.


Similar problems occur in the calculation of screenig ratios in chidren of all ages. The amount of distortion in the measurement varies by age group because of 

differences in the number of screens scheduled for each. 

Th partpant ratis inlu chilen in contg care a"angemts who ma not receig all approprite screens. 

The form HCFA-416 defines the participant ratio as the chidren receiving "health 

screenig supeIVsion" divided by all eligible children. The number of children 

receivig screenig supeIVsion is defined as the number of eligibles enrolled in 

continuig care arrangements (Line 2 of the form HCF A-416) and the number of 

eligibles receivig screening servces (Line 3 of the form HCFA-416). 

The HCF A defies continuing care arrangements as those with EPSDT providers that 

furnish continuous care and monitoring. There are a number of arrangements 

including those that allow a choice of doctors. These may include pediatricians, other 

practicing physicians, Health Maintenance Organizations, and community health 

centers. The HCF A allows States to count all enrollees in continuing care 

arrangements as havig been screened as long as the State has a monitoring process in 

place. Section 5240 states that the State Medicaid agency "is deemed to have met 

EPSDT requirements for participants enrolled with a continuing care provider. 

Three States in our sample had continuing care arrangements. One of the States 

counted in their report only the screenings specifcally documented as having been 

provided to participants in continuing care arrangements. That State s report shows 

less than one-third of the enrollees received a screening for the six-month period of 
Apri 1, 1990 through September 30, 1990. The other two States counted the 

continuig care enrollees as participants in EPSDT screening, although they could not 

verify that all children enrolled with continuing care providers received a screening 

examination during the period. 

SOME STATE' EPSDT REPORTIG IS INCONSISTE WI CUNT 

HCFA INSlRUCTONS.


The form HCFA-416 instruction provides for unform collection of EPSDT 

participation and screening data. However, the wide range of reporting differences by 

the sampled States suggests widespread reportg problems, in addition to those 

discussed above. The number of errors found in State reporting can be attnlmted 

both to the fact that States were using the form for the fist time and that HCF A 

needed to refie their manual instructions on reporting. 

Most of the form HCFA-416s we reviewed had errors. Several sample States 

submitted reports containing incorrect data and miscalculations of the data. Also, one 

State merely estimated the number of hearing and vision seIVces for inclusion in the 

report. Two States submitted a revised form HCFA-416 after they discovered 

problems with the intial report submitted to HCF A One State determined that the 

number of vision and hearing servces was incorrectly counted on the initial report. 

The other State revised the number of individuals eligible for EPSDT and the 

participant ratio initially reported. 

In some instances, we also found that States did not follow RCF A Manuafinstructions 

for the form HCFA-416. For example, one State reported on the form HCFA-416 

only those who actually enrolled in the EPSDT program as EPSDT -eligible. Another 

State did not use the format of the form HCFA-416. As a result, the participation 

ratio and the screening ratio were not reported. Another State used a date different 

from the instruction to determne the eligibilty age of the children reported on the 

form HCFA-416. Also, four States included emergency and treatment servces along 

with the preventive dental care. 

States vary on the manner and method of counting screens. For example, in the 

reported participation ratio for the last six months of FY 1990 (Appendix D), one 

State did not count well-child visits while other States counted these servces as 

EPSDT screenings. Some States count claims while others count procedure codes 

toward EPSDT vision and hearing seIVces. Some States use only an EPSDT claim 

form to count screenings. 

One State respondent told us that the guidelines on the report form were "confusing 

when compared to the instructions contained in Part 2, Section 2700.4. Ths confusion 

led the State to report a percentage not in line with the gudelines on the form, or 

instruction in the HCF A Manual. These inconsistencies resulted in inaccurate counts 

of the screens provided and the number of children receiving EPSDT seIVces. 
(%) (%) (%) (%) (%)

APPENDIX 


EPSDT SCRENG RATIO (%) 

FOR EUGmLE CHREN 

Apri 1, 199 - Sept. 30, 199 

ALL 

ELIGIBLE UNDER 1 - 5 6 - 14 15 - 20 

SAMPLE CHILDREN YEAR YEARS YEARS YEARS 

STATES 

164 

108 

126 

108 

Source: Form HCFA-416 

C - 1

(%) (%) (%) (%) (%)

APPENDIX D


EPSDT PARTICIPAN RATIO (%)


FOR EUGmlE CHRE


Apri 1, 199 - Sept. 30, 199 

ALL 

ELIGIBLE UNDER 1 - 5 6 - 14 15 - 20 

SAMLE CHILDREN YEAR YEARS YEARS YEARS 

STATES 

Source: Form HCFA-416 

D - 1

APPENDIX E


HETH CAR FIANCING ADMISTRTION'S COMMNT


E - 1

&. 

".""1a 

Date 

From 

Subject 

DEPARTMENT OF HEALTH Health Care HUMAN SERVICES Financing Administration 

5 &1 Memorandum 

Wi1


Acting Admstrator


OIG Draf Repon: "EPSDT Performance Measurement" (OEI-07-90130) 

Inpector General


Offce of the Secretary 

We reviewed the subject draf repon in which OIG assesses the accuracy of State reponing of Ealy and Periodic Screenig, Diagnosis and Treatment (EPSDT) 

servces for Medicad-eligible chidren. OIG focused its review on EPSDT program 

expansions, anual paricipation goals, and reponing fuctions mandated by the Omnibus Budget Reconcilation Act of 1989. 

OIG found that the screenig and paricipant ratios used to measure States


performance in the EPSDT program were inaccurate. Alo, OIG found that some
 States' EPSDT reponing was inconsistent with current Health Cae Financig
 Admistration (HCF A) instructions. To address these problems, OIG recommends
 that HCFA: (1) modif the methods by which it measures screenig and parcipation


rates to reflect States ' progress in meeting statutory goals correctly; and,


(2) enhance monitorig procedures to ensure the accuracy of States' reportg. OIG 

acknowledges that a HCF A Work Group is aleady performg an independent evaluation of the EPSDT reponing system, where these recommendations wi be 

implemented. 

We are pleased that OIG used HCFA's comments made on an earlier workig draft of the above-captioned report in the version now released for our review. Our 

curent comments, lited to brief techncal points, are attached for your consideration. We concur with this report and its recommendations subject to the incorporation of these techncal comments in the fial report. 

Than you for the opportunity to review and comment" on this draft report.

Please advise whether you agree with our suggested techncal revisions to the report at your earliest convenience. 

Attachment 

E - 2

, 

Comments of the Health Care Financing Administration ( 

on the DIG Draft Report: "EPSDT Performance Measurement 

07-90-00PO) 

Recommendation 

That HCFA should modify the methods by which it measures screenig and participation 

rates so that they correctly reflect States' progress in meeting statutory goal. 

HCFA Response 

HCF A concurs with this recommendation. However, we suggest the text of the last 

paragraph followig this recommendation (page 9) be amended to read as follows: 

Chidren enrolled in continuing care arrangements are counted as havig received the appropriate number of screens accordig to the screenig schedules. We suggest that HCF A require States to document that all 

eligibles reported as havig received Early and Periodic Screenig, 

Diagnosis and Treatment (EPSDT) screenings, including continuing care 

enrollees, actually receive such servces. 

Recommendation 2


That HCF A enhance monitoring procedures to ensure the accuracy of States' reporting. 

HCFA Response 

HCFA concurs with this recommendation. OIG acknowledges that a HCFA Work 

Group is already evaluating the EPSDT reporting system. Ths evaluation seeks to 

ensure that documentation of EPSDT participation and screenig servces is accurate 

uniform, and useful to decision makers in their assessments of the servces provided to 

eligible chidren. 

Technical Comments 

Page i Background" section, first paragraph. We suggest this paragraph be amended to 

read: 

The EPSDT program was established in 1967. EPSDT is a comprehensive child health program that provides for initial and periodic examiations and 

medical1y necessary fol1ow-up care. The program objective is to fid and 

treat the problems discovered by the screening servces early, before they 

become more complex and costly to treat. 

E - 3 
, 

, 

Page 2


Page 1 Recent Program Amendments" section, fist paragraph. We suggest thi 

paragraph be amended to read: 

Medicaid' s EPSDT program, established in the 1967 amendments to the 

Social Security Act, is a comprehensive chid health program that provdes 

for intial and periodic examations and medicay necessar follow-up 

cae. The program objective is to fid and treat the problems dicovered 

by the screenig servces early, before they become more complex and 

costly to treat.


Page 2, "Vision and Hearg Servces" section, second paragraph. We suggest thi 

paragraph be amended to read: 

Hearig Servces include, at a mium: 

diagnosis and treatment for defects in hearg, including hearg 

aids. 

Page 2 Dental SeIVces" section, first paragraph. We suggest this paragraph be 

amended to read: 

Dental Servces which are provided at intervals that meet reasonable 

standards of dental practice, as determed by the State afer consultation 

with recogned dental organitions involved in chid health cae, and at 

such other intervals as medically necessar to determe the exitence of a 

suspected illess or condition. Dental servces include, at a mium: 

relief of pai and infections, restoration of teeth, and 

maintenance of dental health. 

Page 3 EPSDT Reporting Form" section, fist paragraph. We suggest the fourh item 

the list of inclusions to the report given in the thid sentence of this paragraph be 

amended to- read: 

total number of eligibles provided chid health screenig 

supervsion. 

E - 4