2010-25344. Calculation of Annual Federal Medical Assistance Percentages for Indian Tribes for Use in the Title IV-E Foster Care, Adoption Assistance, and Kinship Guardianship Assistance Programs

AGENCY:

Office of the Secretary, DHHS.

ACTION:

Notice with comment period.

SUMMARY:

The Fostering Connections to Success and Increasing Adoptions Act of 2008 (Pub. L. 110-351) directed HHS to establish assistance payment reimbursement rates for Indian Tribes, tribal organizations and tribal consortia participating in certain child welfare programs authorized under title IV-E of the Social Security Act. These reimbursement rates will be calculated in a manner similar to the Federal Medical Assistance Percentage (FMAP) rates used to reimburse States. This notice describes the Department's proposed methodology for calculating these rates.

DATES:

Effective Date: The methodology described in this applies to Fiscal Years 2010 and beyond. The FMAP rates included in this notice apply to Fiscal Years 2010 and 2011.

Comment Date: To be assured consideration, comments must be received at the address provided below, no later than 5 p.m. on December 7, 2010.

ADDRESSES:

Comments may be submitted via either regular mail or e-mail. If you submit written comments via regular mail, please send one original and one copy of your comments to the following address only: Department of Health and Human Services, Room 404-E, Attention: Tribal FMAP Notice, 200 Independence Ave., SW., Washington, DC 20201.

Comments via e-mail should be sent to the following e-mail address: [e-mail].

Submitting Comments: We welcome comments from the public on the calculation methodology set forth in this notice with comment period to assist us in fully considering issues and developing policies. Please provide a reference to the section on which you choose to comment.

A. Background

The Fostering Connections to Success and Increasing Adoptions Act of 2008 (“Fostering Connections Act”) [Pub. L. 110-351], authorizes Indian Tribes, tribal organizations and tribal consortia to receive funding directly for Foster Care, Adoption Assistance, and Kinship Guardianship Assistance Programs under title IV-E of the Social Security Act. Such direct funding may begin in FY 2010 for Indian Tribes, tribal organizations or tribal consortia with approved title IV-E plans, or eligible Tribes may submit plans to operate such programs at any time in the future. Indian Tribes not operating their own programs may receive title IV-E funds through agreements with the States within which they are located, as authorized under prior law. To date, 86 Indian Tribes have submitted letters of intent to the Administration for Children and Families (ACF) indicating an interest in operating title IV-E programs. Seven Indian Tribes have received title IV-E plan development grants intended to assist Indian Tribes to develop their programs and prepare an approvable title IV-E plan, and one Indian Tribe has submitted a title IV-E plan that is currently under review within ACF. Approximately 90 Indian Tribes currently operate programs under title IV-E agreements with States.

The Federal share of assistance payments for the Title IV-E Foster Care, Adoption Assistance and Kinship Guardianship Assistance Programs is calculated using the Federal Medical Assistance Percentage (FMAP), which is the match rate developed originally for use in the Medicaid Program. FMAP is calculated annually for each State by HHS according to a formula specified in statute (section 1905(b) of the Social Security Act, 42 U.S.C. 1396d(b)). A table displaying each State's FMAP is published annually in the Federal Register and is used by the Centers for Medicare & Medicaid Services (CMS) and others, including the Administration for Children and Families (ACF), in calculating the Federal share of State and territorial expenditures for programs that use the FMAP for determining Federal financial participation. The FMAP formula involves comparing the State's average per capita income over a three year period with the average per capita income of the U.S. as a whole for the same three year period, and results in FMAP rates that vary between statutory minimum and maximum levels of 50 and 83 percent. The formula produces higher Federal matching rates for jurisdictions with lower average per capita incomes relative to the U.S. average. Indian Tribes previously have not been authorized to administer Federal programs that use FMAPs and therefore tribal FMAPs have not previously been calculated.

Section 301 of the Fostering Connections Act added Section 479B to the Social Security Act defining Tribal title IV-E Programs. Section 479B(d) provides for the funding of foster care and adoption assistance programs operated by Indian Tribes and requires HHS to establish FMAP rates for Indian Tribes, tribal organizations, or tribal consortia. Each Tribe's annual FMAP shall be based on the per capita income of the service population of the Indian Tribe, tribal organization, or tribal consortium. However, no tribal FMAP shall be lower than the FMAP of any State in which the Indian Tribe, tribal organization, or tribal consortium is located. That is, for Indian Tribes located in multiple States, the Indian Tribe's FMAP (and that to be used with respect to claiming through any title IV-E agreements between the Indian Tribe and a State title IV-E agency) will be at least as high as that of whichever of the States in which it is located that has the highest FMAP. The FMAP described here will be used for Indian Tribes' title IV-E Foster Care, Adoption Assistance, and Kinship Guardianship Assistance programs whether they are administered directly by the Indian Tribe or through an agreement with a title IV-E State agency. The specific statutory language reads as follows:

(d) Determination of Federal Medical Assistance Percentage for Foster Care Maintenance and Adoption Assistance Payments:

(1) Per Capita Income—For purposes of determining the Federal medical assistance percentage applicable to an Indian Tribe, a tribal organization, or a tribal consortium under paragraphs (1), (2), and (5) of section 474(a), the calculation of the per capita income of the Indian Tribe, tribal organization, or tribal consortium shall be based upon the service population of the Indian Tribe, tribal organization, or tribal consortium, except that in no case shall an Indian Tribe, a tribal organization, or a tribal consortium receive less than the Federal medical assistance percentage for any State in which the Tribe, organization, or consortium is located.

(2) Consideration of Other Information—Before making a calculation under paragraph (1), the Secretary shall consider any information submitted by an Indian Tribe, a tribal organization, or a tribal consortium that the Indian Tribe, tribal organization, or tribal consortium considers relevant to making the calculation of the per capita income of the Indian Tribe, tribal organization, or tribal consortium.

The law also requires the application of the tribal FMAP, if higher than the State FMAP, for assistance payments claimed by a State IV-E agency under title IV-E agreements and contracts between States and Indian Tribes. (See Section 474(a)(1) and (2) of the Social Security Act.)

B. Calculation of FMAP for Indian Tribes

The formula for calculating FMAP for States is specified in title XIX of the Social Security Act (section 1905(b), 42 U.S.C. 1396d(b)). FMAP is calculated according to the following formula:

1-0.45 ((State Per Capita Income)²/(U.S. Per Capita Income)²)

The FMAP for a State cannot be less than 50 percent or more than 83 percent. HHS proposes to use the same formula to calculate FMAP for Indian Tribes for title IV-E programs, substituting the Indian Tribe's per capita income data for that of the State. That is: 1-0.45((Indian Tribe's Per Capita Income)²/(U.S. Per Capita Income)²).

As required by statute, the minimum rate of 50% and the maximum rate of 83% will apply to Indian Tribes. The FMAP rate for each Indian Tribe will be calculated each year in advance of the upcoming fiscal year. Rather than use decimal places, tribal FMAP rates will be rounded up to the next highest whole number (up to a maximum of 83 percent).

C. Data Sources for Calculation of FMAP for Indian Tribes

When calculating FMAP for States, HHS uses data on per capita income produced by the Bureau of Economic Analysis (BEA) within the Department of Commerce, as required by the Medicaid statute (Section 1101(a)(8)(B) of the Social Security Act, 42 U.S.C. 1301(a)(8)(B)). However, BEA does not have data available regarding per capita income for Indian Tribes. Alternative data sources must therefore be used to calculate FMAP for Indian Tribes. HHS has researched available sources of income data for Indian Tribes and has concluded that up to date annual data on per capita income are not currently available for most Indian Tribes.

The U.S. Census Bureau produces the only consistent national data regarding per capita income for each Indian Tribe. However, the source of these data is currently in transition. Per capita income that has in the past been collected every 10 years through the decennial census “long form” will in the future be collected by the Census Bureau using the American Community Survey (ACS), an ongoing data collection mechanism. ACS data will be updated more frequently than Decennial Census data, leading to more current estimates in the future. The ACS provides annual (1-year) estimates for geographic areas with populations of 65,000 or more. By pooling responses from multiple years of ACS data, 3-year estimates are currently produced for geographic areas with populations of 20,000 or more. Few Indian Tribes, however, are large enough for either annual or 3-year estimates to be produced. Of the 86 Tribes and tribal organizations that submitted letters of intent to ACF indicating an interest in operating title IV-E programs, 3-year ACS data is available for only eight. Beginning late in calendar year 2010 (during Federal Fiscal Year 2011) 5-year estimates will become available from the Census Bureau for smaller geographic areas, including all Indian Tribes and tribal lands for which Decennial Census data has previously been collected. The 3-year and 5-year estimates will be updated annually beginning in calendar year 2011.

HHS plans to use ACS 5-year estimates as the data source for FMAP calculations applying to the fiscal year following the April in which such data are available. The Census Bureau currently projects that these data will become available by the end of calendar year 2010. Assuming the data are released as expected or no later than April 2011, HHS will use ACS 5-year estimates for 2012 FMAP calculations for Indian Tribes.

Until ACS data become consistently available, the only complete source of per capita income data for Indian Tribes and tribal communities is that of the 2000 Decennial Census, which reports 1999 per capita income data for Indian tribal lands. However, these data are now ten years old and may not represent current tribal income levels. While current levels are preferable for use in calculating the FMAP, such data do not yet exist. In the absence of more recent data, HHS determined that relying on data from the 2000 Decennial Census is the most viable option until the ACS data becomes available for all Indian Tribes.

We considered whether to use ACS estimates for the several Indian Tribes for which it is available, but decided that it would be more equitable to use the same data source for calculating FMAP for all participating Indian Tribes, tribal organizations and tribal consortia. Therefore, for tribal FMAP rates applying to Fiscal Years 2010 and 2011, HHS will rely on per capita income data from the 2000 Decennial Census, which is the most current data source identified that contains information about per capita incomes for the full range of Indian Tribes.

The law requires that FMAP be calculated on the basis of the Indian Tribe's “service population” for its title IV-E program. Census Bureau data regarding per capita income (including that produced for the Decennial Census and the ACS) can be presented (a) For the total population (all races) living on or near the tribal lands; (b) for the population of individuals identifying themselves only as American Indian or Alaska Native (AI/AN); or (c) for the population who identify themselves as either AI/AN alone or in combination with another race (that is, including multiracial individuals who identify themselves as part AI/AN). Data for populations described in (a) and (b) are standard figures available through the Census Bureau's “American Factfinder” Web site (www.factfinder.census.gov). Data on the “AI/AN alone or in combination” population is available only through special tabulations which may be purchased from the Census Bureau.

In the absence of information on how to characterize Indian Tribes' intended title IV-E service populations, HHS proposes to use per capita income data for the population of individuals identifying themselves only as American Indian or Alaska Native. These data are readily available without special tabulation and does not typically differ substantially from the “AI/AN alone or in combination” population. It is our understanding that figures for the total population living on or near tribal lands includes many persons who are not enrolled members of the Indian Tribe and therefore may not accurately reflect the incomes of the service population. We encourage comments on the issue of which conceptualization of the population should be used in selecting data for FMAP calculations.

Table 1 shows the FMAP rates resulting from various per capita income figures in the 2000 Decennial Census. To determine an Indian Tribe's Federal Medical Assistance Percentage (FMAP) for Fiscal Years 2010 and 2011, the Indian Tribe's per capita income as shown in the 2000 Decennial Census may be matched to the figures in Table 1. Figures falling between any two percentage rates will be rounded up to the next whole number. Per capita income figures of $13,054 or less in the 2000 Decennial Census result in the maximum FMAP of 83%. Most Indian Tribes have relatively low per capita incomes and would therefore qualify for the maximum rate.

Per capita income data for individual Indian Tribes may be found on the Census Bureau Web site at www.factfinder.census.gov. The relevant information is in Census 2000 Summary File 3. Under “custom tables,” the geographic type “American Indian Area/Alaska Native Area/Hawaiian Homelands” identifies Indian Tribes. The per capita income figure the Department intends to use for FMAP calculations is found in table P157C.

D. Calculations for Tribal Organizations and Tribal Consortia

As specified in The Fostering Connections Act, tribal IV-E programs may be operated by federally-recognized Indian Tribes, tribal organizations and consortia of Indian Tribes. In the case of tribal organizations and consortia, data on an individual Indian Tribe will not be sufficient for the calculation of the appropriate FMAP. In the case of a tribal organization or tribal consortium composed of two or more Tribes, HHS will calculate FMAP by weighting the per capita income data according to the proportional representation of each Tribe's service population relative to the total service population of the organization or consortium. For instance, if Tribe A with a population of 6,000 members and Tribe B with a population of 4,000 members together operate a title IV-E program, the applicable FMAP would be calculated by weighting the per capita income figures for the two, such that Tribe A's per capita income is multiplied by the ratio of its population (6,000) to the combined population of the consortia (10,000), that is 6,000/10,000 or 0.6, and Tribe B's per capita income is multiplied by 4,000/10,000 (or 0.4) and the two weighted per capita income figures would be added to produce the per capita income figure for the FMAP formula.

E. Procedures for Producing Annual Updates to Federal Medical Assistance Percentages for Indian Tribes

For fiscal years beyond 2011, the Department plans to use American Community Survey 5-year data for the per capita income estimates of Indian Tribes as well as for the U.S. per capita income information necessary for the FMAP formula. At that point, FMAP rates will be updated annually based on the most recent ACS 5-year estimates available. The formula for the calculation will remain as described above. In the third quarter of each fiscal year ACF regional office staff will communicate with each Indian Tribe, tribal organization, or tribal consortium their tribal FMAP rate for the upcoming fiscal year. Because most Indian Tribes will be receiving the maximum FMAP rate and per capita incomes do not tend to change rapidly, it is likely that many programs will see little, if any, matching rate shifts from year to year. A link to a table similar to the one at the end of this notice will be posted annually on ACF's Web site (http://www.acf.hhs.gov) displaying the per capita income thresholds for each FMAP rate for the fiscal year.

F. Consideration of Supplemental Data

The Fostering Connections Act specifies that before the tribal FMAP calculations for each fiscal year become effective the Secretary shall consider relevant data (e.g., ACS 3-year data) the Indian Tribe, tribal organization or tribal consortium may submit relating to the per capita income calculation.

In the absence of supplemental data, HHS will use the data and procedures described above to calculate the applicable FMAP for the grantee. Indian Tribes, tribal organizations and tribal consortia may submit additional relevant data for the Department's consideration in making the FMAP calculation and such data will be evaluated by the Division of Mandatory Grants in the Office of Grants Management at ACF. Such data may be submitted to the attention of Joseph Lonergan, Director, Division of Mandatory Grant, ACF Office of Grants Management, at 202-401-6603 (phone); 202-401-5644 (fax); or e-mail: [e-mail]. Supplemental data may relate to matters such as the per capita income of the Indian Tribe, tribal organization or consortium, the numbers and/or geographic locations of its service population, and/or defining the grantee's service population to include individuals other than those who identified themselves as American Indian only to be considered for the purposes of calculating the applicable per capita income.

Data to be considered for a given fiscal year's calculation should be submitted no less than 30 days before the beginning of the next fiscal year (September 1) in order to provide sufficient time for the Department to evaluate the suitability of the additional data. Tribal leadership will be consulted prior to a final decision by the Department regarding the suitability of any supplemental data submitted. The Department will also work closely with tribal leaders before establishing a final FMAP for the upcoming fiscal year.

G. Application of Temporary Increases to Tribal Federal Medical Assistance Percentages

From time to time Congress provides for adjustments to FMAP rates in response to economic conditions or other circumstances. At present and continuing through the first quarter of Fiscal Year 2011 (that is, December 30, 2010), States are receiving a temporary increase in their FMAP rates, including a temporary increase of 6.2 percentage points that is applicable to all title IV-E programs in which assistance payments are claimed. The statutory authorization for the temporary increase is found in section 5001 of the American Recovery and Reinvestment Act (ARRA), Public Law 111-5. In addition, Public Law 111-226, the Education, Jobs and Medicaid Assistance Act, provides for rates of 3.2 percentage points above regular FMAP rates for the second quarter of Fiscal Year 2011 (January 1, 2011 through March 31, 2011) and 1.2 percentage points above regular FMAP rates for the third quarter of Fiscal Year 2011 (April 1, 2011 through June 30, 2011). Increased rates authorized by Public Law 111-226 apply to States only if the State's Chief Executive Officer certifies by September 24, 2010 that the State will request and use the additional funds.

To the extent permitted by statute, it is HHS's intention to treat Indian Tribes, tribal organizations, and tribal consortia in the same manner as States. We have determined that the temporary FMAP increases described above will apply to tribal FMAP as they do to States. In the table at the end of this announcement, both standard and temporarily adjusted FMAP applicable through December 30, 2010 are shown. The temporary increases applicable to the second and third quarters of Fiscal Year 2011 are not shown on the table but may be similarly calculated. The applicability of any future FMAP adjustments to Indian Tribes, tribal organizations, and tribal consortia will depend on the specific statutory language enacting such adjustments.

We encourage interested parties to provide comments on the methodology and data sources for calculating the Tribal FMAP rates for title IV-E programs. Specifically, we invite comment on the definition of service population adopted in this notice and alternate data sources for per capita income of Indian tribes, tribal organizations, and tribal consortia.

FOR FURTHER INFORMATION CONTACT:

Laura Radel, Office of the Assistant Secretary for Planning and Evaluation, Room 404-E—Hubert H. Humphrey Building, 200 Independence Avenue, SW., Washington, DC 20201; 202-690-5938; [e-mail].

(Catalog of Federal Domestic Assistance Program Nos. 93.658: Foster Care Title IV-E; 93.659: Adoption Assistance; 93.090: Guardianship Assistance)

Dated: July 1, 2010.

Kathleen Sebelius,

Secretary.

1999 Tribal per capita income range from 2000 decennial census data		Resulting FMAP (percent)	FMAP including 6.2 percentage point increase authorized by ARRA through the first quarter of FY 2011 (percent)
Income greater than or equal to	Income less than or equal to
Per Capita Income Levels
Matched to FY 2010/FY 2011 Federal Medical Assistance Percentage
To determine an Indian Tribe's Federal Medical Assistance Percentage (FMAP) for Fiscal Years 2010 and 2011, find the Indian Tribe's per capita income from the 2000 Decennial Census (American Indian Alone population) in the list of FMAPs below.
1999 Per Capita Income from the 2000 Decennial Census Data: U.S. Estimate = $21,587
FMAP Formula: 1−0.45 × (Indian Tribe Per Capita Income 2/U.S. Per Capita Income 2)
$0	$13,652	83	89.2
13,653	14,027	82	88.2
14,028	14,391	81	87.2
14,392	14,746	80	86.2
14,747	15,093	79	85.2
15,094	15,433	78	84.2
15,434	15,765	77	83.2
15,766	16,090	76	82.2
16,091	16,408	75	81.2
16,409	16,721	74	80.2
16,722	17,028	73	79.2
17,029	17,329	72	78.2
17,330	17,625	71	77.2
17,626	17,917	70	76.2
17,918	18,203	69	75.2
18,204	18,486	68	74.2
18,487	18,764	67	73.2
18,765	19,038	66	72.2
19,039	19,308	65	71.2
19,309	19,574	64	70.2
19,575	19,837	63	69.2
19,838	20,096	62	68.2
20,097	20,352	61	67.2
20,353	20,605	60	66.2
20,606	20,855	59	65.2
20,856	21,102	58	64.2
21,103	21,346	57	63.2
21,347	21,587	56	62.2
21,588	21,825	55	61.2
21,826	22,061	54	60.2
22,062	22,295	53	59.2
22,296	22,526	52	58.2
22,527	22,754	51	57.2
22,755		50	56.2