As referenced in a recent update from the Maine Department of Education, dated August 5, 2015, “in response to new federal grant guidance issued by the Federal Office of Management and Budget, the Maine DOE is now required to offer the ability to recover indirect costs associated with management of federal grants to recipients of federal money passed through the Department. Indirect costs are system-wide, general management functions which support all sub-recipient initiatives.”
While this notice seems to be specific to indirect costs in regard to federal monies passed through the Department of Education, we believe that an indirect rate determined by the Maine Department of Education could also be used in the Medicaid actual cost rate setting process. As you know, MSB has encouraged school districts to calculate an actual cost for services submitted to MaineCare rather than just submitting claims at the published rate. Indirect costs can be part of that rate if they are set by the appropriate “cognizant Federal agency.” (For information concerning the definition of a “cognizant federal agency” in this context, please refer to this Office of Inspector General report, starting on page 3.)
We believe that the update from the Maine Department of Education may indicate that the authority to determine appropriate indirect cost rates for Maine School Districts relative to federal grants may have been delegated to the Maine Department of Education from the US Department of Education and thus it may be appropriate to utilize those indirect rates as developed by the Maine Department of Education via its contractor, Maximus Consulting Services, in the calculation of MaineCare claim rates.
We encourage Maine School Districts to contact the Maine Department of Education to participate in the process of obtaining an indirect rate. Information on this process can found here.
If you have any questions, please do not hesitate to contact your Program Specialist.