That was not the .38 Special, which was fielded in 1902. It was the .38 Long Colt, a significantly weaker cartridge.
Another factor, seldom considered, is the Army also found the .30-40 Krag was lacking in "stopping power". The Moros were often drugged up, and it took a central nervous system hit to stop them.
The .38 Long Colt had a 150 grain bullet at 770 fps. The .38 Special standard load was 158 grain bullet at 855 fps.