[Federal Register Volume 63, Number 16 (Monday, January 26, 1998)]
[Notices]
[Pages 3752-3756]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-1675]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Health Care Financing Administration
HCFA-2005-NC
RIN 0938-AI39
Medicaid Program; State Allotments for Payment of Medicare Part B
Premiums for Qualifying Individuals: Federal Fiscal Year 1998
AGENCY: Health Care Financing Administration (HCFA), HHS.
ACTION: Notice with Comment Period.
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SUMMARY: Section 4732 of the Balanced Budget Act of 1997 (Public Law
105-33) amended the Social Security Act to provide for two additional
eligibility groups of low-income Medicare beneficiaries for whom
Medicaid payment can be made for Medicare Part B premiums during the
period beginning January 1998 and ending December 2002. This notice
announces the Federal fiscal year 1998 State allotments that are
available to pay Medicare Part B premiums for these two new eligibility
groups and describes the methodology used to determine each State's
allotment.
DATES: Effective Date: This is a major rule under 5 U.S.C. section
804(2). As indicated in the preamble of this notice, pursuant to
section 5 U.S.C. section 553(b)(B), for good cause we find that prior
notice and comment procedures are unnecessary and impracticable.
Pursuant to 5 U.S.C. section 808(2), this notice is effective January
1, 1998, for
[[Page 3753]]
allotments for payment of Medicare Part B premiums for individuals in
calendar year 1998 from the allocation for fiscal year 1998.
Comment Date: Written comments will be considered if we receive
them at the appropriate address, as provided below, no later than 5
p.m. on March 27, 1998.
ADDRESSES: Mail written comments (one original and three copies) to the
following address: Health Care Financing Administration, Department of
Health and Human Services, Attention: HCFA-2005-NC, P.O. Box 7517,
Baltimore, MD 21207-0517, or
If you prefer, you may deliver your written comments (one original
and three copies to one of the following addresses:
Room 309-G, Hubert H. Humphrey Building, 200 Independence Avenue, SW,
Washington, DC 20201, or
Room C5-09-26, 7500 Security Boulevard, Baltimore, MD 21244-1850.
Because of staffing and resource limitations, we cannot accept
comments by facsimile (FAX) transmission. In commenting, please refer
to file code HCFA-2005-NC. Comments received timely will be available
for public inspection as they are received, generally beginning
approximately 3 weeks after the publication of a document, in Room 309-
G of the Department's offices at 200 Independence Avenue, SW,
Washington DC, on Monday through Friday of each week from 8:30 a.m. to
5 p.m. (phone: (202) 690-7890).
Copies: To order copies of the Federal Register containing this
document, send your request to: New Orders, Superintendent of
Documents, P.O. Box 37194, Pittsburgh, PA 15250-7954. Specify the date
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This Federal Register document is also available from the Federal
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FOR FURTHER INFORMATION CONTACT: Miles McDermott, (410) 786-3722
SUPPLEMENTARY INFORMATION:
I. Background
Section 1902 of the Social Security Act (the Act) sets forth the
requirements for State plans for medical assistance. Prior to August 5,
1997, section 1902(a)(10)(E) of the Act specified that the State
Medicaid plan must provide for Medicare cost-sharing for three
eligibility groups of low-income Medicare beneficiaries. These three
groups included qualified Medicare beneficiaries (QMBs), specified low-
income Medicare beneficiaries (SLMBs), and qualified disabled and
working individuals (QDWIs).
A QMB is an individual entitled to Medicare Part A with income at
or below the Federal poverty line and resources below $4,000 for an
individual and $6,000 for a couple. A SLMB is an individual who meets
the QMB criteria, except that his or her income is between a State
established level (at or below the Federal poverty line) and 120
percent of the Federal poverty line. A QDWI is an individual who is
entitled to enroll in Medicare Part A, whose income does not exceed 200
percent of the Federal poverty line for a family of the size involved,
whose resources do not exceed twice the amount allowed under the
Supplementary Security Income (SSI) program, and who is not otherwise
eligible for Medicaid. The definition of Medicare cost-sharing at
section 1905(p)(3) of the Act includes payment for premiums for
Medicare Part B.
Section 4732 of the Balanced Budget Act of 1997 (BBA), enacted on
August 5, 1997, amended section 1902(a)(10)(E) of the Act to require
States to provide for Medicaid payment of the Medicare Part B premiums
for two additional eligibility groups of low-income Medicare
beneficiaries, referred to as qualifying individuals (QIs).
Specifically, a new section 1902(a)(10)(E)(iv)(I) of the Act is added,
under which States must pay the full amount of the Medicare Part B
premium for selected qualifying individuals who would be QMBs but for
the fact that their income level is at least 120 percent but less than
135 percent of the Federal poverty line for a family of the size
involved. These individuals cannot otherwise be eligible for medical
assistance under the approved State Medicaid plan.
The second group of QIs, added under section 1902(a)(10)(E)(iv)(II)
of the Act, includes Medicare beneficiaries who would be QMBs except
that their income is between 135 percent and 175 percent of the Federal
poverty line for a family of the size involved, who are not otherwise
eligible for Medicaid under the approved State plan. These QIs are
eligible for a portion of Medicare cost-sharing consisting only of a
percentage of the increase in the Medicare Part B premium attributable
to the shift of Medicare home health coverage from Part A to Part B (as
provided in section 4611 of the BBA).
The BBA also added a new section 1933 to the Act to provide for
Medicaid payment of Medicare Part B premiums for QIs. (The previous
section 1933 is redesignated as section 1934.) Section 1933(a)
specifies that a State plan must provide, through a State plan
amendment, for medical assistance to pay for the cost of Medicare cost-
sharing on behalf of qualifying individuals who are selected to receive
assistance.
Section 1933(b) of the Act sets forth the rules that States must
follow in selecting QIs and providing payment for Medicare Part B
premiums. Specifically, the State must permit all qualifying
individuals to apply for assistance and must select individuals on a
first-come, first-served basis (that is, the State must select QIs in
the order in which they apply). Under section 1933(b)(2)(B) of the Act,
in selecting persons who will receive assistance in years after 1998,
States must give preference to those individuals who received
assistance as QIs, QMBs, SLMBs, or QDWIs in the last month of the
previous year and who continue to be (or become) QIs. Under section
1933(b)(4), persons selected to receive assistance in a calendar year
are entitled to receive assistance for the remainder of the year, but
not beyond, as long as they continue to qualify. The fact that an
individual is selected to receive assistance at any time during the
year does not entitle the individual to continued assistance for any
succeeding year. Because the State's allotment is limited by law,
section 1933(b)(3) of the Act provides that the State must limit the
number of QIs so that the amount of assistance provided during the year
is approximately equal to the State's allotment for that year.
[[Page 3754]]
Section 1933(c) of the Act limits the total amount of Federal funds
available for payment of Part B premiums each fiscal year and specifies
the formula that is to be used to determine an allotment for each State
from this total amount. For States that execute a State plan amendment
in accordance with section 1933(a) of the Act, a total of $1.5 billion
is allocated over 5 years as follows: $200 million in FY 1998; $250
million in FY 1999; $300 million in FY 2000; $350 million in FY 2001;
and $400 million in FY 2002.
The Federal matching rate for Medicaid payment of Medicare Part B
premiums for qualifying individuals is 100 percent for expenditures up
to the amount of the State's allotment. No Federal matching funds are
available for expenditures in excess of the State allotment amount.
Administrative expenses associated with the payment of Medicare Part B
premiums for QIs remain at the 50 percent matching level and are not
part of the State's allotment.
The amount appropriated for each fiscal year is to be allocated
among States according to the formula set forth in section 1933(c)(2)
of the Act. The formula provides for an amount to each State that is to
be based on each State's share of the Secretary's estimate of the ratio
of: (1) an amount equal to the sum of (a) twice the total number of
individuals who meet all but the income requirements for QMBs, whose
incomes are at least 120 percent but less than 135 percent of the
Federal poverty line, and who are not otherwise eligible for Medicaid,
and (b) the total number of individuals in the State who meet all but
the income requirements for QMBs, whose incomes are at least 135
percent but less than 175 percent of the Federal poverty line, and who
are not otherwise eligible for Medicaid, to (2) the sum of all of these
individuals under item (1) for all eligible States.
II. Provisions of this Notice
This notice announces the availability of individual State
allotments for Federal fiscal year 1998 for the Medicaid payment of
Medicare Part B premiums for qualifying individuals identified under
sections 1902(a)(10)(E)(iv) (I) and (II) of the Act.
In this notice, we are not applying precisely the statutory formula
to determine the individual State allotments. A precise application of
the allocation formula in the statute would require us to determine
State-specific estimates of the number of individuals who:
Are entitled to Medicare Part A;
Have incomes in the poverty level ranges specified;
Have assets not exceeding twice the amount allowed under
the SSI program; and
Would not be eligible for Medicaid but for the provisions
of section 1902(a)(10)(E) of the Act regarding QIs.
Section 4732(c)(2) of the BBA allows HCFA to take an estimate of
the ration of the relevant numbers. We have not been able to locate any
available current data that would permit us to directly produce the
estimates specified in the statute. As an alternative to direct
measurement, we believe that estimates might be derived from models of
income, assets, and State Medicaid eligibility. Estimates could be
constructed using available data sources; however such an approach
would be very time-consuming and resource-intensive and may still not
produce credible State-level estimates. Consequently, we are
approximating the required estimates by using data from the U.S. Census
Bureau on the number of individuals who, according to its March Current
Population Survey (CPS), are Medicare beneficiaries, have incomes in
the appropriate ranges, and are not enrolled in Medicaid.
In order to reduce the variability of State-level estimates derived
from CPS data, we have used a moving average of the most recent 3 years
of available data. For the FY 1998 allotments shown in the table below,
we have averaged CPS data for the years 1994 through 1996.
Specifically, the Federal fiscal year 1998 allotments have been
calculated as follows:
AT=Total amount to be allocated
M1i=3-year average of the number of Medicare
beneficiaries in state i who are not enrolled in Medicaid and whose
incomes are at least 120 percent but less than 135 percent of Federal
poverty line M2i=3-year average of the number of Medicare
beneficiaries in State i who are not enrolled in Medicaid and whose
incomes are at least 135 percent but less than 175 percent of Federal
poverty line.
Then, the allotment reserved for State i is determined by the
following formula:
[GRAPHIC] [TIFF OMITTED] TN26JA98.000
The resulting allotments are shown by State in the table below.
Estimated State Allotments for Medicaid Payments of Medicare Part B Premiums
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State FY 98
State (a) M1\1\ (b) M2\2\ (c) [2 x State share of allocation (in
(a)]+(b) (c) (percent) thousands)
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AK.............................. 0 2 2 0.03 $63
AL.............................. 36 65 137 2.14 4,283
AR.............................. 21 37 79 1.23 2,470
AZ.............................. 18 50 86 1.34 2,688
CA.............................. 99 311 509 7.96 15,911
CO.............................. 13 33 59 0.92 1,844
CT.............................. 13 65 91 1.42 2,845
DC.............................. 2 3 7 0.11 219
DE.............................. 4 9 17 0.27 531
FL.............................. 89 270 448 7.00 14,004
GA.............................. 42 102 186 2.91 5,814
HI.............................. 4 9 17 0.27 531
IA.............................. 15 49 79 1.23 2,470
ID.............................. 4 15 23 0.36 719
IL.............................. 75 167 317 4.95 9,909
IN.............................. 25 92 142 2.22 4,439
KS.............................. 13 41 67 1.05 2,094
KY.............................. 18 91 127 1.98 3,970
LA.............................. 27 56 110 1.72 3,439
MA.............................. 37 83 157 2.45 4,908
[[Page 3755]]
MD.............................. 25 72 122 1.91 3,814
ME.............................. 7 27 41 0.64 1,282
MI.............................. 44 122 210 3.28 6,565
MN.............................. 18 55 91 1.42 2,845
MO.............................. 30 81 141 2.20 4,408
MS.............................. 26 42 94 1.47 2,938
MT.............................. 8 16 32 0.50 1,000
NC.............................. 58 110 226 3.53 7,065
ND.............................. 5 11 21 0.33 656
NE.............................. 10 26 46 0.72 1,438
NH.............................. 7 17 31 0.48 969
NJ.............................. 51 118 220 3.44 6,877
NM.............................. 10 29 49 0.77 1,532
NV.............................. 7 19 33 0.52 1,032
NY.............................. 92 271 455 7.11 14,223
OH.............................. 56 167 279 4.36 8,721
OK.............................. 26 47 99 1.55 3,095
OR.............................. 22 53 97 1.52 3,032
PA.............................. 82 213 377 5.89 11,785
RI.............................. 7 18 32 0.50 1,000
SC.............................. 27 52 106 1.66 3,314
SD.............................. 5 9 19 0.30 594
TN.............................. 39 56 134 2.09 4,189
TX.............................. 78 221 377 5.89 11,785
UT.............................. 4 18 26 0.41 813
VA.............................. 19 81 119 1.86 3,720
VT.............................. 4 7 15 0.23 469
WA.............................. 9 67 85 1.33 2,657
WI.............................. 10 56 76 1.19 2,376
WV.............................. 19 39 77 1.20 2,407
WY.............................. 2 4 8 0.13 250
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Total..................... 1362 3674 6398 100.00 200,000
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\1\ Three-year average of number (000) of Medical beneficiaries in State who are not enrolled in Medicaid but
whose incomes are at least 120 but less than 135 of Federal Poverty Line.
\2\ Three-year average of number (000) of Medicare beneficiaries in State who are not enrolled in Medicaid but
whose incomes are at least 135 but less than 175 of Federal Poverty Line.
III. Waiver of Advance Public Comment and 30-Day Delay in Effective
Date
We ordinarily publish an advance notice in the Federal Register for
a notice containing substantive rules to provide a period for public
comment. However, we may waive that procedure if we find good cause
that notice and comment are impractical, unnecessary, or contrary to
the public interest. In addition, we also normally provide a delay of
30 days in the effective date. However, if adherence to this procedure
would be impractical, unnecessary, or contrary to public interest, we
may waive the delay in the effective date.
We are adopting this notice as a final with comment period without
publication of a proposed notice because of the need to notify
individual States in advance of the limitations with Federal matching
funds in their Medicaid expenditures for payment of Medicare Part B
premiums for qualifying individuals. Publication of a proposed notice
with a 60-day comment period prior to publication of a final notice
would, we believe, be contrary to the public interest. The law is
specific regarding the total amount available for Medicare Part B
premiums for qualifying individuals and the formula that is to be used
to determine individual State allotments. Therefore, we find good cause
to waive issuance of a proposed notice and to issue the notice as
final.
Also, because States can begin making payments for Medicare Part B
premiums for qualifying individuals as early as January 1, 1998, we are
not making the effective date of the notice the usual 30 days after
publication. For the reasons discussed above, we find good cause to
waive the usual 30-day delay.
Although we are publishing this as a final notice, we are providing
a 60-day period for public comment. Because of the large number of
items of correspondence we normally receive, we are not able to
acknowledge or respond to the comments individually. However, if we
decide that changes are necessary as a result of our consideration of
timely comments, we will issue an additional notice and respond to the
comments in that notice.
IV. Effect of the Contract with America Advancement Act
Normally, under 5 U.S.C. section 801, as added by section 251 of
Public Law 104-121, the effective date of a major rule is delayed 60
days for Congressional review. This has been determined to be a major
rule under 5 U.S.C. section 804(2). However, as indicated in section
III of this notice with comment period, we have found that good cause
exists to dispense with prior notice and comment procedures since they
are unnecessary and impracticable under the circumstances. Pursuant to
5 U.S.C. section 808(2), a rule shall take effect at such time as the
Federal agency promulgating the rule determines if it finds, for good
cause, that prior notice and comment procedures are unnecessary or
impracticable. Accordingly, under the exemption provided in 5 U.S.C.
section
[[Page 3756]]
808(2), this notice with comment period is effective January 1, 1998,
for allotments for payments of Medicare Part B premiums for individuals
in calendar year 1998 from the allotment for fiscal year 1998.
V. Regulatory Impact Statement
We have examined the impact of this notice with comment period as
required by Executive Order 12866 and the Regulatory Flexibility Act
(RFA) (Pub. L. 96-354). Executive Order 12866 directs agencies to
assess all costs and benefits of available regulatory alternatives and,
when regulation is necessary, to select regulatory approaches that
maximize net benefits (including potential economic, environmental,
public health and safety effects; distributive impacts; and equity).
The RFA requires agencies to analyze options for regulatory relief for
small businesses. For purposes of the RFA, States and individuals are
not considered to be small entities.
This notice with comment period implements provisions of the
Balanced Budget Act of 1997 to allocate, among the States, Federal
funds to provide Medicaid payment for Medicare Part B premiums for two
additional groups of low-income Medicare beneficiaries. The total
amount of Federal funds available during a Federal fiscal year and the
formula for determining individual State allotments are specified in
the law. We have applied the statutory formula for the State allotments
except for the use of specified data. Because the data specified in the
law were not currently available, we have used comparable data from the
U.S. Census Bureau on the number of possible qualifying individuals in
the States.
We believe that the statutory provisions implemented in this notice
with comment period will have a positive effect on States and
individuals. Federal funding at the 100 percent matching rate is
available for Medicare cost-sharing for Medicare Part B premium
payments for qualifying individuals and a greater number of low-income
Medicare beneficiaries will be eligible to have their Medicare Part B
premiums paid under Medicaid.
Section 1102(b) of the Social Security Act requires us to prepare a
regulatory impact analysis for any notice that may have a significant
impact on the operations of a substantial number of small rural
hospitals. Such an analysis must conform to the provisions of section
603 of the RFA. For purposes of section 1102(b) of the Act, we define a
small rural hospital as a hospital that is located outside a
Metropolitan Statistical Area and has fewer than 50 beds.
We are not preparing analyses for either the RFA or section 1102(b)
of the Act because we have determined and certify that this notice with
comment period will not have a significant economic impact on a
substantial number of small entities or a significant impact on the
operations of a substantial number of small rural hospitals.
In accordance with the provisions of Executive Order 12866, this
notice with comment period was reviewed by the Office of Management and
Budget.
Authority: Sections 1902(a)(10), 1933 of the Social Security Act
(42 U.S.C. 1396a), and Public Law 105-33.
(Catalog of Federal Domestic Assistance Program No. 93.778, Medical
Assistance Program)
Dated: December 12, 1997.
Nancy-Ann Min DeParle,
Administrator, Health Care Financing Administration.
Dated: January 13, 1998.
Donna E. Shalala,
Secretary.
[FR Doc. 98-1675 Filed 1-23-98; 8:45 am]
BILLING CODE 4120-01-P
