[Federal Register Volume 65, Number 104 (Tuesday, May 30, 2000)]
[Notices]
[Pages 34478-34481]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-13346]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration

HCFA-2063-N
RIN 0938-AJ72


Medicaid Program; State Allotments for Payment of Medicare Part B 
Premiums for Qualifying Individuals: Federal Fiscal Year 2000

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

ACTION: Notice.

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SUMMARY: The Social Security Act provides for the Medicaid program to 
pay all or part of the Medicare Part B premiums for 5 years (Federal 
fiscal years 1998 through 2002) for two specific eligibility groups of 
low-income Medicare beneficiaries, referred to as Qualifying 
Individuals. This notice announces the Federal fiscal year 2000 
allotments that are available for State agencies to pay Medicare Part B 
premiums for these eligibility groups.

EFFECTIVE DATE: This notice is effective October 1, 1999 for allotments 
for payment of Medicare Part B premiums for individuals in calendar 
year 2000 from the allocation for fiscal year 2000.

FOR FURTHER INFORMATION CONTACT: Miles McDermott, (410) 786-3722.

SUPPLEMENTARY INFORMATION:

I. Background

A. Before the Balanced Budget Act of 1997

    Before the enactment of the Balanced Budget Act of 1997 (BBA), 
section 1902(a)(10)(E) of the Social Security Act (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 level and resources below $4,000 for an 
individual and $6,000 for a couple. An 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 level) and 120 
percent of the Federal poverty level. 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 level 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.

B. After the Balanced Budget Act of 1997

    Section 4732 of the BBA amended section 1902(a)(10)(E) of the Act 
to require States to provide for Medicaid payment of the Medicare Part 
B premiums, during the period beginning January 1998 and ending 
December 2002, for two eligibility groups of low-income Medicare 
beneficiaries, referred to as Qualifying Individuals (QIs).
    Under section 1902(a)(10)(E)(iv)(I) of the Act, State agencies are 
required to pay the full amount of the Medicare Part B premium for 
selected QIs who would be QMBs except that their income level is at 
least 120 percent but less than 135 percent of the Federal poverty 
level 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, under section 1902(a)(10)(E)(iv)(II) of 
the Act, includes Medicare beneficiaries who would be QMBs except that 
their income is at least 135 percent but less than 175 percent of the 
Federal poverty level for a family of the size involved. These QIs may 
not be otherwise eligible for Medicaid under the approved State plan, 
but 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).
    Section 4732(c) of the BBA also added section 1933 of the Act, 
which specifies the provisions for State coverage of the Medicare cost-
sharing for additional low-income Medicare beneficiaries.
    Section 1933(a) of the Act specifies that a State agency must 
provide, through a State plan amendment, for medical assistance to pay 
for the cost of Medicare cost-sharing on behalf of QIs who are selected 
to receive assistance.
    Section 1933(b) of the Act sets forth the rules that State agencies 
must follow in selecting QIs and providing payment for Medicare Part B 
premiums. Specifically, the State agency must permit all QIs to apply 
for assistance and must select individuals on a first-come, first-
served basis in the order in which they apply. Under section 
1933(b)(2)(B) of the Act, when selecting

[[Page 34479]]

persons who will receive assistance in the years after 1998, State 
agencies 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 now 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 agency 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.
    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 to be used to determine an allotment for each State from 
this total amount. For State agencies that execute a State plan 
amendment in accordance with section 1933(a) of the Act, a total of 
$1.5 billion was 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 QIs 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's allotment amount. Administrative 
expenses associated with the payment of Medicare Part B premiums for 
QIs remain at the 50 percent matching level and may not be taken from 
the State's allotment.
    The amount available 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 agency 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 the following:
    (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 level, 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 level, 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 2000 for the Medicaid payment of 
Medicare Part B premiums for QIs identified under sections 
1902(a)(10)(E)(iv)(I) and (II) of the Act. The formula used to 
calculate these allotments was described in detail in the January 26, 
1998 Federal Register (63 FR 3754) and, except for the incorporation of 
the latest data, has been used here without changes.

           FY 2000 State Allotments for Payment of Part B Premiums Under Sec. 4732 of the BBA of 1997
                                                 [In thousands]
----------------------------------------------------------------------------------------------------------------
                                                                                                   State FY 2000
                                                                    (c)  [2  x    State share of    allocation
              State                 (a) M1 \1\      (b)  M2 \2\     (a)] + (b)       (c)  (in       (dollars in
                                                                                     percent)       thousands)
----------------------------------------------------------------------------------------------------------------
AK..............................               1               4               6            0.09             278
AL..............................              37              82             156            1.41           7,231
AR..............................              25              43              93            1.44           4.311
AZ..............................              17              71             105            1.62           4.867
CA..............................             102             327             531            8.20          24,614
CO..............................              13              23              49            0.76           2,271
CT..............................               6              52              64            0.99           2,967
DC..............................               2               5               9            0.14             417
DE..............................               5              10              20            0.31             927
FL..............................             100             280             480            7.42          22,250
GA..............................              33              92             158            2.44           7,324
HI..............................               4              10              18            0.28             834
IA..............................              13              54              80            1.24           3,708
ID..............................               5              17              27            0.42           1,252
IL..............................              56             179             291            4.50          13,489
IN..............................              36             103             175            2.70           8,112
KS..............................              14              57              85            1.31           3,940
KY..............................              24              80             128            1.98           5,933
LA..............................              29              75             133            2.06           6,165
MA..............................              33              81             147            2.27           6,814
md..............................              21              66             108            1.67           5,006
ME..............................               8              18              34            0.53           1,576
MI..............................              48             128             224            3.46          10,383
MN..............................              26              63             115            1.78           5,331
MO..............................              25              85             135            2.09           6,258
MS..............................              16              40              72            1.11           3,337
MT..............................               5              13              23            0.36           1,066
NC..............................              48             115             211            3.26           9,781
ND..............................               5              13              23            0.36           1,066
NE..............................              12              31              55            0.85           2,549
NH..............................               6              16              28            0.43           1,298
NJ..............................              44             120             208            3.21           9,642
NM..............................              10              20              40            0.62           1,854
NV..............................               4              18              26            0.40           1,205

[[Page 34480]]

 
NY..............................              99             228             426            6.58          19,747
OH..............................              72             183             327            5.05          15,158
OK..............................              27              51             105            1.62           4,867
OR..............................              13              44              70            1.08           3,245
PA..............................              83             196             362            5.59          16,780
RI..............................               9              24              42            0.65           1,947
SC..............................              25              80             130            2.01           6,026
SD..............................               5              11              21            0.32             973
TN..............................              29              45             103            1.59           4,774
TX..............................              79             212             370            5.72          17,151
UT..............................               3              20              26            0.40           1,205
VA..............................              13              86             112            1.73           5,192
VT..............................               4               8              16            0.25             742
WA..............................              17              44              78            1.21           3,616
WI..............................              26              82             134            2.07           6,211
WV..............................              18              45              81            1.25           3,755
WY..............................               3               6              12            0.19             556
    Total.......................            1358            3756            6472          100.00        300,000
----------------------------------------------------------------------------------------------------------------
\1\ Three-year average (1996-1998) of number of Medicare beneficiaries in State who are not enrolled in medicaid
  but whoe incomes are at least 120% but less than 135% of FPL.
\2\ Three-year average (1996-1998) of number of Medicare beneficiaries in State who are not enroleld in Medicaid
  but whose incomes are at least 135% but less than 175% of FPL.

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 the public interest, 
we may waive the delay in the effective date.
    We find good cause to waive notice and comment procedure for this 
notice. The law sets out in detail the specific amounts available for 
each Federal fiscal year for Medicare Part B premiums for QIs and the 
formula that is used to determine individual State allotments. In 
addition, the latest data from the U. S. Census Bureau on the number of 
possible QIs in the States, used in the statutory formula as discussed 
in section V of this notice, is not available until too late in the 
calendar year. Therefore, it would be impracticable, unnecessary, and 
contrary to the public interest to submit this notice to the public for 
a notice and comment procedure.
    Also, because States can begin making payments for Medicare Part B 
premiums for QIs as early as January 1, 2000, we are not making the 
effective date of the notice the usual 30 days after publication. For 
the reasons discussed previously, we find good cause to waive the usual 
30-day delay.

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, we have found that good cause exists to dispense 
with prior notice and comment procedures since they are unnecessary and 
impracticable under the circumstances. Under 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 808(2), this notice is 
effective October 1, 1999, for allotments for payments of Medicare Part 
B premiums for individuals in calendar year 2000 from the allotment for 
Federal fiscal year 2000.

V. Regulatory Impact Statement

    We have examined the impact of this notice as required by Executive 
Order 12866 and the Regulatory Flexibility Act (RFA) (Public Law 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 allocates, among the States, Federal funds to provide 
Medicaid payment for Medicare Part B premiums for QIs. 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 QIs in the States, as 
described in detail in the January 26, 1998 Federal Register. These new 
allotments for FY 2000 incorporate the latest data from the Census 
Bureau covering 1996 through 1998, as specified in the footnote to the 
preceding table.
    We believe the statutory provisions implemented in this notice will 
have a

[[Page 34481]]

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 QIs, 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 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 
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 was reviewed by the Office of Management and Budget.
    We have reviewed this notice under the threshold criteria of 
Executive Order 13132 of August 4, 1999, Federalism, published in the 
Federal Register on August 10, 1999 (64 FR 43255). The Executive Order 
is effective on November 2, 1999, which is 90 days after the date of 
the Order. We have determined that this notice does not significantly 
affect the rights, roles, and responsibilities of States.

    Authority: Sections 1902(a)(10)(E) and 1933 of the Social 
Security Act (42 U.S.C. 1396a(a)(10)(E) and 1396x).


(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program)

    Dated: September 28, 1999.
Michael M. Hash,
Deputy Administrator, Health Care Financing Administration. 

    Dated: November 22, 1999.
Donna E. Shalala,
Secretary.

    Editorial Note.
    This document was received at the Office of the Federal Register 
May 23, 2000.

[FR Doc. 00-13346 Filed 5-26-00; 8:45 am]
BILLING CODE 4120-01-P