[Federal Register Volume 59, Number 190 (Monday, October 3, 1994)]
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From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 94-24384]
Federal Register / Vol. 59, No. 190 / Monday, October 3, 1994 /
[[Page Unknown]]
[Federal Register: October 3, 1994]
VOL. 59, NO. 190
Monday, October 3, 1994
DEPARTMENT OF AGRICULTURE
Food and Nutrition Service
7 CFR Parts 272 and 273
[Amendment No. 359]
RIN 0584-AB78
Food Stamp Program; Medical Expense Deduction
AGENCY: Food and Nutrition Service, USDA.
ACTION: Interim rule.
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SUMMARY: This action will change Food Stamp Program rules relating to
the excess medical expense deduction. The changes will simplify the
means by which households with elderly and disabled members claim
deductions from income for verified, prospective, non-reimbursed
medical expenses.
DATES: Effective Date: This rule is effective and must be implemented
no later than October 1, 1994.
Comments: Comments must be received on or before December 2, 1994
to be assured of consideration.
ADDRESSES: Comments should be submitted to Judith M. Seymour,
Eligibility and Certification Regulation Section, Certification Policy
Branch, Program Development Division, Food and Nutrition Service, USDA,
3101 Park Center Drive, Alexandria, Virginia, 22302. Comments may also
be datafaxed to the attention of Ms. Seymour at (703) 305-2454. All
written comments will be open for public inspection at the office of
the Food and Nutrition Service during regular business hours (8:30 a.m.
to 5 p.m., Monday through Friday) at 3101 Park Center Drive,
Alexandria, Virginia, Room 720.
FOR FURTHER INFORMATION CONTACT: Questions regarding this rulemaking
should be addressed to Ms. Seymour at the above address or by telephone
at (703) 305-2496.
SUPPLEMENTARY INFORMATION:
Executive Order 12866
This rule has been determined to be significant and was reviewed by
the Office of Management and Budget under Executive Order 12866.
Executive Order 12372
The Food Stamp Program is listed in the Catalog of Federal Domestic
Assistance under No. 10.551. For the reasons set forth in the final
rule in 7 CFR 3015, Subpart V and related Notice (48 FR 29115), this
Program is excluded from the scope of Executive Order 12372 which
requires intergovernmental consultation with State and local officials.
Regulatory Flexibility Act
This rule has been reviewed with regard to the requirements of the
Regulatory Flexibility Act of 1980 (5 U.S.C. 601-612). Ellen Haas, the
Assistant Secretary for Food and Consumer Services, has certified that
this interim rule will not have a significant economic impact on a
substantial number of small entities. State and local welfare agencies
will be the most affected to the extent that they administer the
Program.
Paperwork Reduction Act
This rule does not contain reporting or recordkeeping requirements
subject to approval by the Office of Management and Budget (OMB) under
the Paperwork Reduction Act of 1980 (44 U.S.C. 3507).
Executive Order 12778
This rule has been reviewed under Executive Order 12778, Civil
Justice Reform. This rule is intended to have preemptive effect with
respect to any State or local laws, regulations or policies which
conflict with its provisions or which would otherwise impede its full
implementation. This rule is not intended to have retroactive effect
unless so specified in the Effective Date paragraph of this preamble.
Prior to any judicial challenge to the provisions of this rule or the
application of its provisions, all applicable administrative procedures
must be exhausted. In the Food Stamp Program the administrative
procedures are as follows: (1) for Program benefit recipients--State
administrative procedures issued pursuant to 7 U.S.C. 2020(e)(1) and 7
CFR 273.15; (2) for State agencies--administrative procedures issued
pursuant to 7 U.S.C. 2023 set out at 7 CFR 276.7 (for rules related to
non-quality control (QC) liabilities) or Part 284 (for rules related to
QC liabilities); (3) for Program retailers and wholesalers--
administrative procedures issued pursuant to 7 U.S.C. 2023 set out at 7
CFR 278.8.
Public Participation and Effective Date
The amendment to section 5(e) of the Food Stamp Act of 1977 (7
U.S.C. 2014(e)) which is reflected in this rule was enacted in 1990 as
section 1717 of the Mickey Leland Memorial Domestic Relief Act (1990
Leland Act), Title XVII, Pub. L. 101-624 (104 Stat. 3783, Nov. 28,
1990). This amendment was effective February 1, 1992. The provisions of
this rule are required to be implemented not later than October 1,
1994, in order to assure that all State agencies are in full compliance
with the amendment as soon as possible. For this reason, Ellen Haas,
Assistant Secretary for Food and Consumer Services, has determined
pursuant to 5 U.S.C. 553 that public comment on this rule prior to
implementation is impracticable and that good cause exists for making
this rule effective less than 30 days after its publication. However,
because we believe the administration of the rule may be improved by
public comment, comments are solicited on this rule for 60 days after
publication. All comments received within the comment period will be
analyzed, and any appropriate changes will be incorporated in the
subsequent publication of a final rule.
Background
Section 351 of the Hunger Prevention Act of 1988, Pub. L. 100-435
(102 Stat. 1645, September 19, 1988) (HPA) amended Section 5(e) of the
Food Stamp Act of 1977, as amended, 7 U.S.C. 2014(e), to require State
agencies to offer eligible households with an elderly or disabled
member a method for claiming a deduction for recurring medical expenses
in place of provisions that had required households to report and
verify expenses monthly. On June 7, 1989, the Department published an
interim rulemaking at 54 FR 24518, which implemented Section 351 of
Pub. L. 100-435. The interim rules are still in effect.
The 1989 interim rule amended several provisions of the regulations
pertaining to the medical deduction, particularly in the area of
reporting and verification requirements for allowable medical expenses.
Under the 1989 interim rule, households subject to monthly reporting
are given the option of either reporting and verifying all medical
expenses monthly, or of reporting and verifying changes in medical
expenses in excess of $25 occurring during the certification period,
but they cannot be required to report under both procedures. The 1989
interim rule amended 7 CFR 273.21(h)(3) (i) and (ii), (i)(1), and
(j)(3)(iii) to specify the household's options with regard to reporting
and verifying medical expenses in a monthly reporting and retrospective
budgeting (MRRB) system. In addition, 7 CFR 273.12(a)(1)(vi) and 7 CFR
273.21(h)(3)(iii) were amended by the 1989 interim rule to simplify
reporting changes in medical expenses. The 1989 interim rule required
that changes in total medical expenses greater than $25 must be
reported, as opposed to a $25 change in each individual allowable
medical expense.
Following publication of the 1989 interim rule, the 1990 Leland Act
was enacted. Regulations published to implement provisions of that Act
superseded some of the changes made in the 1989 interim rule. Section
1724 of the 1990 Leland Act delegated to each State agency the
responsibility for design of the monthly report form, including the
determination of what information relevant to eligibility and benefits
was to be included on that form. These provisions of section 1724 were
implemented by the Monthly Reporting and Retrospective Budgeting
Amendments and Mass Changes final rule, published on December 4, 1991
at 56 FR 63597. Conforming amendments to verification requirements
associated with the monthly report were also made at that time. The
regulatory amendments in the December 4, 1991 final rule superseded the
changes made to 7 CFR 273.21(h)(3) (i), (ii), and (iii), and (i)(1) by
the 1989 interim rule, because the interim provisions concerned the
information that the Department mandated be contained on the monthly
report form.
The amendments made to the regulations at 7 CFR 273.12(a)(vi) and
273.21(j)(iii) (C) and (D) by the 1989 interim rule were neither
finalized nor superseded by subsequent regulations. As explained below,
however, the Department is now making new amendments to these sections.
Section 1717 of the 1990 Leland Act amended section 5(e) of the
Food Stamp Act to provide for a simplified means for eligible
households to claim the excess medical expense deduction for recurring
medical costs. Section 1717 requires State agencies to estimate at
certification a recipient's recurring medical expenses for the
certification period based upon the recipient's current verified
medical expenses, as well as available information about the
recipient's medical condition, and public or private medical insurance
coverage. The household's medical deduction would be based on these
estimates, and further verification would not be required. In a
proposed rule entitled ``Miscellaneous Provisions of the Mickey Leland
Memorial Domestic Hunger Relief Act and Food Stamp Certification
Policy,'' published on June 28, 1991 (56 FR 29594), the Department
stated that food stamp regulations at 7 CFR 273.2(f)(8) and
273.12(a)(6) already reflected the intent of the statute and that,
therefore, no change to the regulations was required. No comments
disputing this position were received, and the position was reiterated
in a final rule published on December 4, 1991 (56 FR 63594).
It has come to the attention of the Department that some State
agencies may not be properly applying section 1717. This may be due to
confusion on the part of State agencies with regard to the Department's
decision not to issue regulations in connection with section 1717. To
ensure that State agencies are in compliance with section 1717, the
Department issued three memoranda to FNS regional offices, dated
February 3, 1994, April 1, 1994, and May 12, 1994. In the memoranda,
the Department instructed the regional offices to remind State agencies
that they must be in compliance with the provisions of section 1717.
The Department also offered direction as to how the State agencies can
implement the provisions of section 1717.
In a further effort to insure that State agencies are implementing
the provisions of section 1717, the Department is amending food stamp
regulations that concern the medical expense deduction. These changes
will clarify current regulations to better express the intent of
section 1717. Accordingly, this rule amends 7 CFR 273.10(d)(1)(i),
273.10(d)(4), 273.12(a)(vi), 273.21 (h), (i), and (j)(iii) (C) and (D).
Under the amendments, the household will be required to report and
verify all medical expenses at certification and recertification. The
household's monthly medical deduction for its certification period will
be based on the information reported and verified by the household, and
any anticipated changes in the household's medical expenses that can be
reasonably expected to occur during the certification period based on
available information about the recipient's medical condition, public
or private insurance coverage, and current verified medical expenses.
If the household reports a medical expense at certification but cannot
verify the expense at that time, and if the amount of the expense
cannot be reasonably anticipated based on available information about
the recipient's medical condition, public or private insurance
coverage, and current verified medical expenses, the expense will be
considered at the time the amount of the expense or reimbursement is
reported and verified. The household will not be required to file
reports about its medical expenses during the certification period. If
the household voluntarily reports a change in its medical expenses, the
State agency will act on the changes in accordance with current
regulations at 7 CFR 273.12(c).
The Department is also making a related amendment to the
regulations at 7 CFR 273.12(c) for changes in medical expenses that are
discovered from a source other than the household. Currently, those
regulations require the State agency to act on all changes in a
household's circumstances, including those it discovers from a source
other than the household. Often times, however, the State agency must
contact the household to verify such unreported changes. Since the
intent of section 1717 is to avoid recurrent reporting and verification
on the part of households receiving the medical expense deduction, the
Department is amending 7 CFR 273.12(c) to require that the State agency
act on those changes in medical expenses it learns of from a source
other than the household only if it can act without contacting the
household for further information or verification. The household will
be informed about the changes in accordance with the notice
requirements at 7 CFR 273.13. Those changes learned from a source other
than the household which are not verified upon receipt and therefore
necessitate contact with the household for verification purposes shall
not be acted upon until the household is recertified.
Implementation
This rule is effective and must be implemented no later than
October 1, 1994. For quality control purposes, any variances resulting
from the implementation of the rule shall be excluded from error
analysis for 120 days from the required implementation date, in
accordance with 7 CFR 275.12(d)(2)(vii). The provision must be
implemented for all households that newly apply for Program benefits on
or after the required implementation date. The current caseload shall
be converted to these provisions at the household's request, at the
time of recertification, or when the case is next reviewed, whichever
occurs first. The State agency must provide restored benefits to such
households back to the required implementation date or the date of
application whichever is later. If for any reason a State agency fails
to implement on the required implementation date, restored benefits
shall be provided, if appropriate, back to the required implementation
date or the date of application whichever is later.
List of Subjects
7 CFR Part 272
Alaska, Civil rights, Food stamps, Grant programs--social programs,
Reporting and recordkeeping requirements.
7 CFR Part 273
Administrative practice and procedure, Aliens, Claims, Food stamps,
Fraud, Grant programs--social programs, Penalties, Records, Reporting
and recordkeeping requirements, Social Security.
Accordingly, 7 CFR parts 272 and 273 are amended as follows:
1. The authority citation for 7 CFR parts 272 and 273 continues to
read as follows:
Authority: 7 U.S.C. 2011-2032.
PART 272--REQUIREMENTS FOR PARTICIPATING STATE AGENCIES
2. In Sec. 272.1, paragraph (g)(138) is added to read as follows:
Sec. 272.1 General terms and conditions.
* * * * *
(g) Implementation * * *
(138) Amendment No. 359 The provision of Amendment No. 359
regarding the medical expense deduction is effective and must be
implemented no later than October 1, 1994. Any variances resulting from
implementation of the provisions of this amendment shall be excluded
from error analysis for 120 days from this required implementation date
in accordance with 7 CFR 275.12(d)(2)(vii). The provision must be
implemented for all households that newly apply for Program benefits on
or after the required implementation date. The current caseload shall
be converted to these provisions at the household's request, at the
time of recertification, or when the case is next reviewed, whichever
occurs first. The State agency must provide restored benefits to such
households back to the required implementation date or the date of
application whichever is later. If for any reason a State agency fails
to implement on the required implementation date, restored benefits
shall be provided, if appropriate, back to the required implementation
date or the date of application whichever is later.
PART 273--CERTIFICATION OF ELIGIBLE HOUSEHOLDS
3. In 273.10:
a. The fifth sentence of paragraph (d)(1)(i) is revised;
b. Four sentences are added to the end of paragraph (d)(4).
The revisions and additions read as follows:
Sec. 273.10 Determining household eligibility and benefit levels.
* * * * *
(d) Determining deductions. * * *
(1) Disallowed expenses.
(i) * * * If the household reports an allowable medical expense at
the time of certification but cannot provide verification at that time,
and if the amount of the expense cannot be reasonably anticipated based
upon available information about the recipient's medical condition and
public or private medical insurance coverage, the household shall have
the nonreimbursable portion of the medical expense considered at the
time the amount of the expense or reimbursement is reported and
verified. * * *
* * * * *
(4) Anticipating expenses. * * * At certification and
recertification, the household shall report and verify all medical
expenses. The household's monthly medical deduction for the
certification period shall be based on the information reported and
verified by the household, and any anticipated changes in the
household's medical expenses that can be reasonably expected to occur
during the certification period based on available information about
the recipient's medical condition, public or private insurance
coverage, and current verified medical expenses. The household shall
not be required to file reports about its medical expenses during the
certification period. If the household voluntarily reports a change in
its medical expenses, the State agency shall verify the change in
accordance with Sec. 273.2(f)(8) and act on the change in accordance
with current regulations at Sec. 273.12(c).
* * * * *
4. In 273.12:
a. Paragraph (a)(1)(vi) is removed;
b. Paragraph (c) introductory text is amended by adding two
sentences after the first sentence to read as follows:
Sec. 273.12 Reporting changes.
* * * * *
(c) State agency action on changes. * * * However, during the
certification period, the State agency shall not act on changes in the
medical expenses of households eligible for the medical expense
deduction which it learns of from a source other than the household and
which, in order to take action, require the State agency to contact the
household for verification. The State agency shall only act on those
changes in medical expenses that it learns about from a source other
than the household if those changes are verified upon receipt and do
not necessitate contact with the household. * * *
* * * * *
5. In Sec. 273.21:
a. Paragraph (h)(3) is revised.
b. A third sentence is added to paragraph (i).
c. Paragraph (j)(3)(iii)(C) is revised.
d. Paragraph (j)(3)(iii)(D) is removed and paragraph (j)(3)(iii)(E)
is redesignated as paragraph (j)(3)(iii)(D).
The revisions read as follows:
Sec. 273.21 Monthly Reporting and Retrospective Budgeting (MRRB)
* * * * *
(h) The monthly report form. * * *
(3) Reported information. The State agency may determine the
information relevant to eligibility and benefit determination to be
included on the monthly report form except that the State agency shall
not require households to monthly report medical expenses. Medical
expenses may be reported in accordance with Sec. 273.10(d)(4).
* * * * *
(i) Verification. * * * Medical expenses shall be verified in
accordance with Sec. 273.2(f).
(j) State agency action on reports. * * *
(3) Incomplete filing. * * *
(iii) * * *
(C) If a household fails to verify changes in reported medical
expenses in accordance with Sec. 273.2(f)(8), the State agency shall
not make the change.
* * * * *
Dated: September 27, 1994.
Ellen Haas,
Assistant Secretary for Food and Consumer Services.
[FR Doc. 94-24384 Filed 9-30-94; 8:45 am]
BILLING CODE 3410-30-P