Kansas schools to repay more than $11 million after KDHE mistake on Medicaid funds
Schools across the state are being asked to repay money after a Kansas Department of Health and Environment error resulted in more than $11 million in overpaid Medicaid funding.
The mistake was discovered after an audit of the Kansas Department of Health and Environment found discrepancies in data that had gone unnoticed for several years.
The data mistake affected Medicaid payments to school districts, including Wichita Public Schools, which budgets for and hires staff to provide Medicaid-eligible services to students based on KDHE calculations, according to WPS Chief Communications Officer Rachel Bell.
While most districts owe less than $25,000, the Wichita school district owes more than $3 million for overpaid Medicaid services — the largest payback amount in the state.
“Paying for a multi-year audit finding out of one fiscal year’s budgeted revenue presents financial hardships to districts who still need to employ staff providing these required services to students,” Bell wrote in a statement to the Eagle.
Derby Public Schools must repay almost $13,000, while Haysville owes more than $70,000. Andover USD 385 has to return a little more than $11,000 while Maize and Goddard schools owe just over $1,000 each.
Bell said the districts were presented with “limited options” to repay the money. The district decided to repay the $3.1 million over four quarterly payments.
“In part, this option was chosen because WPS was awaiting more information from KDHE about specifics of the error and the corrective action plan,” Bell said. “This information was not available to districts when the strict decision timeline was presented.”
The district is using unrestricted reserve funds to cover the cost of the repayment. Bell said a miscalculation like this by the state underscores how important access to unrestricted funds is for Wichita Public Schools.
“Unforeseen financial needs such as this are an example of why WPS maintains unrestricted reserves. These reserves will have to backfill the shortfall the audit finding repayment has created for the 2025-26 budget year,” Bell said.
In response to the audit’s findings, the Kansas Department of Health and Environment said it’s taking steps to ensure similar mistakes don’t happen again. The department said it will undertake additional staff training and process reviews.
This story was originally published August 29, 2025 at 1:09 PM.
