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District to seek settlement, interlocal after troubles with Medicaid billing vendor
Summary
San Angelo ISD staff said they will ask the board to authorize superintendent-led settlement negotiations with a third‑party Medicaid billing provider and plan to pursue an interlocal agreement with Houston ISD for billing services; staff reported a reduced exposure from ~$584,000 to ~$112,000 after fee adjustments.
District staff told trustees May 11 they intend to negotiate a settlement to end a problematic third‑party Medicaid billing contract and to pursue an interlocal agreement with Houston ISD for future billing services.
"We talked about canceling the contract with MSB for third party Medicaid billing," Brandon said, recounting that the district previously faced exposure of roughly $584,000; after the vendor reduced its fee from 6% to 1%, the estimated exposure declined to about $112,000. Staff said they engaged outside counsel (Walsh Gallegos) to review cost reports and options for recouping funds.
Staff said their plan is to ask the board in June to authorize the superintendent to negotiate settlement terms and to enter an interlocal agreement with Houston ISD, which the district’s special‑education staff selected from six interviewed firms because of its reputation for school billing services. Staff noted an interlocal would remove the need for a new RFP for those services.
The board placed the proposed contract termination on consent at the workshop and expects a formal request in June to complete any settlement and the proposed interlocal agreement.
