[Federal Register Volume 65, Number 101 (Wednesday, May 24, 2000)]
[Notices]
[Pages 33634-33638]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-12880]



  Federal Register / Vol. 65, No. 101 / Wednesday, May 24, 2000 / 
Notices  

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration

[HCFA-2064 N]
RIN 0938-AJ77


State Children's Health Insurance Program; Final Allotments to 
States, Commonwealths, and Territories for Fiscal Years 1998 and 1999

AGENCY: Health Care Financing Administration (HCFA), HHS.

ACTION: Notice.

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SUMMARY: This notice sets forth the final allotments of Federal funding 
available to each State, Commonwealth and Territory for fiscal years 
(FYs) 1998 and 1999 under title XXI of the Social Security Act (the 
Act). The final allotments are the same as the reserved allotments 
previously published in the Federal Register on February 8, 1999.
    Established by section 4901 of the Balanced Budget Act of 1997 
(Public Law 105-33), title XXI of the Act authorizes payment of Federal 
matching funds to States, Commonwealths and Territories to initiate and 
expand health insurance coverage to uninsured, low-income children 
through a State Children's Health Insurance Program (SCHIP), an 
expansion of a State Medicaid program, or a combination of both.
    Recent legislation, the Medicare, Medicaid and SCHIP Balanced 
Budget Refinement Act (BBRA) of 1999 (Public Law 106-113, enacted 
November 29, 1999), amended title XXI of the Act in part by modifying 
the allotment formula, effective with the FY 2000 allotments. The FY 
1998 and 1999 allotments contained in this notice were determined under 
the allotment formula in existence prior to the enactment of Public Law 
106-113.

ADDRESSES: Copies: To order copies of the Federal Register containing 
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academic libraries throughout the country that receive the Federal 
Register.
    This Federal Register document is also available from the Federal 
Register online database through GPO Access, a service of the U.S. 
Government Printing Office. Free public access is available on a Wide 
Area Information Server (WAIS) through the Internet and via 
asynchronous dial-in. Internet users can access the database by using 
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password required).

FOR FURTHER INFORMATION CONTACT: Richard Strauss, (410) 786-2019.

SUPPLEMENTARY INFORMATION:

I. Background

    The reserved FY 1998 allotments were originally published on 
September 12, 1997 in the Federal Register (62 FR 48098). On February 
8, 1999, revised reserved FY 1998 allotments and reserved FY 1999 
allotments were published in the Federal Register (64 FR 6102). The 
allotments were originally published as reserved because not all 
States, Commonwealths, and Territories had submitted and had State 
child health plans approved by HCFA. Final allotments may only be 
provided to those with approved plans. For purposes of planning and 
budgeting, the reserved FYs 1998 and 1999 allotments were calculated as 
if all States, Commonwealths and Territories had approved State child 
health plans.
    Public Law 105-174, enacted on May 1, 1998, provides that for 
purposes of the calculation of allotments, a State child health plan 
approved by HCFA on or after October 1, 1998, and before October 1, 
1999, must be treated as having been approved for both FYs 1998 and 
1999. Because all States, Commonwealths, and Territories had approved 
plans prior to the end of FY 1999, the final FYs 1998 and 1999 SCHIP 
allotments are available to all of them and are, therefore, the same as 
the reserved allotments published on February 8, 1999.
    While none of the provisions of Public Law 106-113 take effect 
retroactively, one provision of the legislation is incorporated into 
this notice due to the fact that the new legislation was enacted prior 
to the publication of this final notice. Specifically, section 704 of 
the BBRA of 1999 requires that the program enacted by title XXI of the 
Act be referred to exclusively as ``SCHIP'' rather than ``CHIP'' and 
that the term ``State children's health insurance program'' be 
substituted for ``children's health insurance program.'' This provision 
applies to the Secretary of the U.S. Department of Health and Human 
Services, as well as any other Federal officer or employee, in any 
publication or other official communication.

II. Purpose of This Notice

    This notice sets forth the final allotments of Federal funding 
available to each State, Commonwealth and Territory for fiscal years 
(FYs) 1998 and 1999 under title XXI of the Social Security Act. Final 
allotments for a fiscal year are available to match expenditures under 
an approved State child health plan for three fiscal years, including 
the year for which the final allotment was provided. Federal funds 
appropriated for title XXI are limited, and the law specifies a formula 
to divide the total annual appropriation into individual allotments 
available for each State, Commonwealth and Territory with an approved 
child health plan, as described under section III of the February 8, 
1999 Federal Register notice (64 FR 6102).
    Section 2104(b) of the Act indicates that ``the Secretary shall 
allot to each State * * * with a State child health plan approved under 
this title.'' This language requires States, Commonwealths, and 
Territories to have an approved State child health plan for the fiscal 
year in order for the Secretary to provide an allotment for that fiscal 
year. If a State, Commonwealth, or Territory does not have an approved 
State child health plan for that fiscal year, the amount of their 
reserved allotment would be unavailable to them and would be allotted 
to those with approved State child health plans. On September 8, 1999, 
the last two States seeking approval for their State child health plans 
were granted approval. Since all States, Commonwealths, and Territories 
had approved plans prior to the end of FY 1999, this notice merely 
republishes as final the same FYs 1998 and 1999 allotments that were 
originally published as reserved allotments in the February 8, 1999 
Federal Register notice.
    We issued a proposed rule on March 4, 1999 in Federal Register (64 
FR 10412), on the requirements for the allotment and payment process 
under title XXI. The allotments set forth in this notice were 
calculated in accordance

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with the process set forth in that proposed rule.
    For informational purposes, we are republishing the FYs 1998 and 
1999 allotment charts below, which are the same as those published in 
the February 8, 1999 notice.

III. Table of State Children's Health Insurance Program Final 
Allotments for FYs 1998 and 1999

Key to Tables I and II

Column/Description

    Column A = Name of State, Commonwealth, or Territory.
    Column B = Number of Children. The Number of Children for each 
State (provided in thousands) was determined and provided by the Bureau 
of the Census based on the arithmetic average of the number of low-
income children and low-income children with no health insurance as 
calculated from the 1994, 1995, and 1996 March supplements to the 
Current Population Survey, as adjusted in August 1998. These data 
represent the number of people in each State under 19 years of age 
whose family income is at or below 200 percent of the poverty threshold 
appropriate for that family, and who are reported to be not covered by 
health insurance. The Number of Children for each State was developed 
by the Bureau of the Census based on the standard methodology used to 
determine official poverty status and uninsured status in their annual 
Current Population Surveys on these topics. For FYs 1998 and 1999, the 
Number of Children is equal to the number of low-income children in 
each State with no health insurance for the fiscal year.
    Column C=State Cost Factor. The State Cost Factor for a State is 
equal to the sum of: .15, and .85 multiplied by the ratio of the annual 
average wages in the health industry per employee for the State to the 
annual wages per employee in the health industry for the 50 States and 
the District of Columbia. The State Cost Factor for each State was 
calculated based on such wage data for each State as reported, 
determined, and provided to HCFA by the Bureau of Labor Statistics in 
the Department of Labor for 1993, 1994, and 1995.
    Column D=Product. The Product for each State was calculated by 
multiplying the Number of Children in Column B by the State Cost Factor 
in Column C. The sum of the Products for all 50 States and the District 
of Columbia is below the Products for each State in Column D. The 
Product for each State and the sum of the Products for all States 
provides the basis for allotment to States.
    Column E=Percent Share of Total. This is the calculated percentage 
share for each State of the total allotment available to the 50 States 
and the District of Columbia. The Percent Share of Total is calculated 
as the ratio of the Product for each State in Column D to the sum of 
the products for all 50 States and the District of Columbia below the 
Products for each State in Column D.
    Column F=Allotment. This is the State Child Health Program 
allotment for each State, Commonwealth, or Territory. For each of the 
50 States and the District of Columbia, this is determined as the 
Percent Share of Total in Column E for the State multiplied by the 
total amount available for allotment for the 50 States and the District 
of Columbia for the fiscal year.
    For each of the Commonwealths and Territories, the allotment is 
determined as the Percent Share of Total in Column E multiplied by the 
total amount available for allotment to the Commonwealths and 
Territories. For the Commonwealths and Territories, the Percent Share 
of Total in Column E is specified in section 2104(c) of the Act. For FY 
1999, the Commonwealths and Territories were allotted an additional $32 
million, which is added to the total allotment available to them for FY 
1999, determined by the formula described above. The total amount is 
then allotted to the Commonwealths and Territories according to the 
percentages specified in section 2104 of the Act.
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III. Impact Statement

    HCFA has examined the impact of this notice as required by 
Executive Order 12866. Executive Order 12866 directs agencies to assess 
all costs and benefits of available regulatory alternatives and, when 
rules are necessary, to select regulatory approaches that maximize net 
benefits (including potential economic environments, public health and 
safety, other advantages, distributive impacts, and equity). We believe 
that this notice is consistent with the regulatory philosophy and 
principles identified in the Executive Order. The formula for the 
allotments is specified in the statute. Since the formula is specified 
in the statute, we have no discretion in determining the allotments.
    The Unfunded Mandates Reform Act of 1995 requires that agencies 
prepare an assessment of anticipated costs and benefits before 
publishing any notice that may result in an expenditure in any year by 
State, local, and tribal governments, in the aggregate, or by the 
private sector, of $100,000,000 or more (adjusted each year for 
inflation). Because participation in the SCHIP program on the part of 
States is voluntary, any payments and expenditures States make or incur 
on behalf of the program that are not reimbursed by the federal 
government are made voluntarily. This notice will not create unfunded 
mandate on States, tribal or local governments. Therefore, we are not 
required to perform an assessment of the costs and benefits of these 
regulations.
    Under Executive Order 12612, Federalism, we have reviewed this 
notice and determined that it does not significantly affect States' 
rights, roles, and responsibilities. Low-income children will benefit 
from payments under this program through increased opportunities for 
health insurance coverage.
    We believe this notice has an overall positive impact by informing 
States, Commonwealths, and Territories of the extent to which they are 
permitted to expend funds under their State child health plans using 
their FYs 1998 and 1999 allotments.
    In accordance with the provisions of Executive Order 12866, this 
notice was reviewed by the Office of Management and Budget.

(Section 1102 of the Social Security Act (42 U.S.C. 1302)

(Catalog of Federal Domestic Assistance Program No. 00.000, State 
Children's Health Insurance Program)
    Dated: March 22, 2000.
Nancy-Ann Min DeParle,
Administrator, Health Care Financing, Administration.

    Dated: March 27, 2000.
Donna E. Shalala,
Secretary.
[FR Doc. 00-12880 Filed 5-23-00; 8:45 am]
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