[Federal Register Volume 65, Number 176 (Monday, September 11, 2000)]
[Rules and Regulations]
[Pages 54747-54790]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-22753]


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SOCIAL SECURITY ADMINISTRATION

20 CFR Parts 404 and 416

[Regulations No. 4 and 16]
RIN 0960-AF40


Supplemental Security Income; Determining Disability for a Child 
Under Age 18

AGENCY: Social Security Administration.

ACTION: Final rules.

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SUMMARY: On February 11, 1997, we published interim final rules with a 
request for comments to implement the Supplemental Security Income 
(SSI) childhood disability provisions of sections 211 and 212 of Public 
Law (Pub. L.) 104-193, the Personal Responsibility and Work Opportunity 
Reconciliation Act of 1996. We are now publishing revised final rules 
in response to public comments. We are also conforming our rules to 
amendments to Public Law 104-193 made by the Balanced Budget Act of 
1997, Public Law 105-33. Finally, we are simplifying and clarifying 
some rules in keeping with the President's goal of using plain language 
in regulations.

DATES: These rules are effective January 2, 2001.

FOR FURTHER INFORMATION CONTACT: Georgia Myers, Regulations Officer, 
Social Security Administration, 6401 Security Boulevard, Baltimore, MD 
21235, [email protected], (410) 965-3632 or TTY (410) 966-5609 for 
information about these rules. For information on eligibility or filing 
for benefits, call our national toll-free number, 1-800-772-1213 or TTY 
1-800-325-0778, or visit our Internet web site, SSA Online, at 
www.ssa.gov.

SUPPLEMENTARY INFORMATION: We are revising and making final the interim 
final rules we published on February 11, 1997, to implement the 
childhood disability provisions of Public Law 104-193 (62 FR 6408). 
Even though we published interim final rules in 1997, we asked for 
public comments on those rules. We are now summarizing and responding 
to the public comments and making revisions to the interim final rules 
based on the public comments and on our program experience in applying 
the interim rules since February 1997. In the final rules, we continue 
to define the statutory standard of ``marked and severe functional 
limitations'' in terms of marked limitations in two areas of 
functioning or extreme limitation in one such area. However, we are 
also making a number of changes to our rules on functional equivalence 
and ``other factors'' in response to the comments.
    We are also conforming our rules to amendments to Public Law 104-
193 made by the Balanced Budget Act of 1997, Public Law 105-33, 111 
Stat. 251. Even though the amendments were enacted after we published 
the interim final rules, the changes are required by the statute and 
make no discretionary policy changes. We are also simplifying and 
clarifying the language of some rules in keeping with the President's 
goal of using plain language in regulations.
    A number of individuals who commented on the interim final rules 
expressed concern that we had not consulted with outside experts in the 
development of those rules. Given the short time we had under Public 
Law 104-193 to develop the interim final rules, it was not feasible to 
engage in the type of consultation the commenters suggested before we 
published those rules. However, in response to the comments, and to 
ensure that these final rules are as accurate and inclusive as 
possible, we asked a number of individual experts for information as we 
formulated these final rules. The experts included pediatricians, 
psychologists, and other pediatric specialists, and individual 
advocates for children with disabilities who have expert knowledge 
about the SSI program.

History

    For a detailed history of the childhood disability provisions 
before the changes made by Public Law 104-193, interested readers may 
review the preamble to the interim final rules (62 FR 6408). That 
preamble explains how we first implemented the prior statutory 
definition of disability for children, based on ``comparable severity'' 
to the definition of disability for adults, and the changes we made to 
our rules in 1991 after the Supreme Court's decision in Sullivan v. 
Zebley, 493 U.S. 521 (1990).
    Public Law 104-193, the Personal Responsibility and Work 
Opportunity Reconciliation Act of 1996, 110 Stat. 2105, removed the 
comparable severity standard and provided a new statutory definition of 
disability for children claiming SSI benefits. It also directed us to 
make significant changes in the way we evaluate childhood disability 
claims. Under the law, which created a new section 1614(a)(3)(C) of the 
Social Security Act (the Act), a child's impairment or combination of 
impairments must cause more serious impairment-related limitations than 
the old law and our prior regulations specified.
    Section 1614(a)(3)(C) of the Act provides the following definition 
of disability for children claiming SSI benefits:

    (C)(i) An individual under the age of 18 shall be considered 
disabled for the purposes of this title if that individual has a 
medically determinable physical or mental impairment, which results 
in marked and severe functional limitations, and which can be 
expected to result in death or which has lasted or can be expected 
to last for a continuous period of not less than 12 months.
    (ii) Notwithstanding clause (i), no individual under the age of 
18 who engages in substantial gainful activity * * * may be 
considered to be disabled.

    The conference report that accompanied Public Law 104-193 
explained:

    The conferees intend that only needy children with severe 
disabilities be eligible for SSI, and the Listing of Impairments and 
other current disability determination regulations as modified by 
these provisions properly reflect the severity of disability 
contemplated by the new statutory definition. In those areas of the 
Listing that involve domains of functioning, the conferees expect no 
less than two marked limitations as the standard for qualification. 
The conferees are also aware that SSA uses the term ``severe'' to 
often mean ``other than minor'' in an initial screening procedure 
for disability determination and in other places. The conferees, 
however, use the term ``severe'' in its common sense meaning.

    H.R. Conf. Rep. No. 725, 104th Cong., 2d Sess. 328 (1996), 
reprinted in 1996 U.S. Code, Cong. and Ad. News 2649, 2716. The House 
report contains similar language. See H.R. Rep. No. 651, 104th Cong., 
2d Sess. 1385 (1996), reprinted in 1996 U.S. Code, Cong. and Ad. News 
2183, 2444.
    Further provisions concerning childhood disability adjudication are 
summarized below with references to the relevant sections of Public Law 
104-193 and, where appropriate, the Act.
     We were directed to remove references to ``maladaptive 
behavior'' in the prior personal/behavioral domain from Secs. 112.00C2 
and 112.02B2c(2) of the childhood mental disorders listings (Public Law 
104-193, section 211(b)(1)).
     We were directed to discontinue the individualized 
functional assessment (IFA) for children in Secs. 416.924d and 416.924e 
of our former rules, which we had used since 1991 (Pub. L. 104-193, 
section 211(b)(2)).
     Within 1 year after the date of enactment, we were to 
redetermine the eligibility of individuals under the age

[[Page 54748]]

of 18 who qualified for SSI based on disability as of August 22, 1996, 
and whose eligibility might terminate because of changes made by Public 
Law 104-193. We were required to use the eligibility criteria we use 
for new applicants, not the medical improvement review standard in 
section 1614(a)(4) of the Act and Sec. 416.994a that we use in 
continuing disability reviews (CDRs) (Pub. L. 104-193, section 
211(d)(2)).
     The medical improvement review standard for determining 
continuing eligibility for children was revised to conform to the new 
definition of disability for children (Pub. L. 104-193, section 211(c); 
section 1614(a)(4)(B) of the Act).
     Not less frequently than once every 3 years, we must 
conduct a CDR for any childhood disability recipient eligible by reason 
of an impairment(s) that is likely to improve. At the option of the 
Commissioner, we may also perform a CDR with respect to those 
individuals under age 18 whose impairments are unlikely to improve 
(Pub. L. 104-193, section 212(a); section 1614(a)(3)(H)(ii) of the 
Act).
     We must redetermine the eligibility of individuals who 
were eligible for SSI based on disability in the month before the month 
in which they attained age 18. This age-18 redetermination must use the 
initial adult eligibility rules and must occur during the 1-year period 
beginning on the individual's 18th birthday. The medical improvement 
review standard used in CDRs does not apply to these redeterminations 
(Pub. L. 104-193, section 212(b); section 1614(a)(3)(H)(iii) of the 
Act).
     We must conduct a CDR not later than 12 months after the 
birth of the child for any child whose low birth weight is a 
contributing factor material to our determination that the child was 
disabled (Pub. L. 104-193, section 212(c); section 1614(a)(3)(H)(iv) of 
the Act).
     At the time of a CDR, a child's representative payee must 
present evidence that the child is and has been receiving treatment to 
the extent considered medically necessary and available for the 
disabling impairment. If a payee refuses without good cause to provide 
such evidence, we may select another representative payee, or pay 
benefits directly to the child, if we determine that it is appropriate 
and in the best interests of the child (Pub. L. 104-193, section 
212(a); section 1614(a)(3)(H)(ii) of the Act).

The Interim Final Rules

    The interim final rules we published on February 11, 1997, 
implemented all of the provisions of sections 211 and 212 of Pub. L. 
104-193, except section 211(d)(2). See 62 FR 6408; corrected at 62 FR 
13537, March 21, 1997, and 62 FR 36460, July 8, 1997. Section 211(d)(2) 
required us to redetermine the eligibility of children who might be 
affected by the change in law, and did not require regulations. In 
brief, we deleted references to the former standard of ``comparable 
severity'' to adults and deleted the IFA regulations and all references 
to the IFA in other regulations. We deleted references to ``maladaptive 
behaviors'' and related references in the sections of our regulations 
and the Listing of Impairments cited in Pub. L. 104-193. We also made 
other changes in our rules that were necessary because of these 
revisions.
    In Secs. 416.902 and 416.906 of the interim final rules, we 
explained that, to be found disabled, an individual under age 18 must 
have ``marked and severe functional limitations.'' In Sec. 416.902, we 
explained that the term ``marked and severe functional limitations,'' 
when used as a phrase, means the standard of disability in the Act for 
children claiming SSI benefits. This standard of disability requires a 
level of severity that meets, medically equals, or functionally equals 
the severity of an impairment(s) in the listings; i.e., is of listing-
level severity. We explained that the separate words ``marked'' and 
``severe'' are also terms used throughout our rules, but the meanings 
of these words in the phrase ``marked and severe functional 
limitations'' are not the same as their meanings when used separately.
    Other significant changes made by the interim final rules included 
the following:
     We revised Sec. 416.924, ``How we determine disability for 
children,'' to reflect the changes made by Pub. L. 104-193 and to 
establish a new sequential evaluation process for determining 
disability for children. The new three-step process required a child 
who was not working to show that he or she had a ``severe'' impairment 
or combination of impairments that met, medically equaled, or 
functionally equaled the severity of an impairment(s) in the listings.
     In new Sec. 416.924(g) we referred to a Childhood 
Disability Evaluation Form, Form SSA-538, which we issued in 
conjunction with the interim final rules. Section 416.924(g) required 
our adjudicators (except disability hearing officers) at the initial 
and reconsideration levels of our administrative review process to 
complete an SSA-538 to show their findings in each case. We also 
explained that disability hearing officers, administrative law judges, 
and administrative appeals judges on the Appeals Council (when the 
Appeals Council makes a decision) will not complete the form but will 
indicate their findings at each step in the sequential evaluation 
process in their determinations or decisions.
     We revised Sec. 416.925(b)(2), which explains the purpose 
of the childhood listings in part B of the listings, to explain that 
``listing-level severity'' generally means marked limitations in two 
broad areas of functioning or extreme limitation in one such area.
     We revised Sec. 416.926 to provide rules for determining 
medical equivalence for both adults and children. Our prior rules had 
addressed medical equivalence for children separately, in 
Sec. 416.926a. We also incorporated in Sec. 416.926 of the interim 
final rules language from prior Sec. 416.926a and our operating 
instructions to clarify the rules. We also intended the changes to be 
consistent with our rules in Sec. 404.1526 (the rule for disability 
claims under title II of the Act), which we did not change in the 
interim final rules.
     We published revised and expanded guidelines for 
determining functional equivalence to the listings in Sec. 416.926a. 
The interim final rules continued to provide four methods for 
determining functional equivalence, and the primary method continued to 
be evaluating whether a child had marked limitations in two broad areas 
of development or functioning or extreme limitation in one area. We 
also added a new area, called ``motor development'' or ``motor 
functioning,'' to help our adjudicators better evaluate physical 
impairments. We also retained our requirement that a finding of 
functional equivalence must be related to a particular listing. 
Generally, we used a childhood mental disorders listing to make this 
finding. However, adjudicators could use any listing that included 
disabling functional limitations among its criteria.
    In publishing the improved functional equivalence rules, we noted 
that even though Congress eliminated the IFA, it directed us to 
continue to evaluate a child's functional limitations where 
appropriate, although using a higher level of severity than under the 
former IFA. Congress also explicitly endorsed our functional 
equivalence policy as a means to evaluate impairments that would not 
meet or medically equal any listings and without which some needy 
children with severe disabilities would not be found eligible. (62 FR 
6413)

[[Page 54749]]

     We revised the rules in Secs. 416.990 and 416.994a 
relating to CDRs of children to reflect the changes in the frequency of 
CDRs. The changes we made to these rules included requiring CDRs for 
children who qualified because of low birth weight, and making 
conforming changes to reflect the definition of disability for children 
in Pub. L. 104-193.
     We published a new Sec. 416.987 to provide rules for 
redetermining the eligibility of individuals who attain age 18 and who 
were eligible for SSI based on disability in the month before the month 
in which they attained age 18. The section included a rule that we 
would not count an individual's earnings when we determine disability 
under this section. It also provided rules for notifying individuals 
who will have these redeterminations.
     We revised Secs. 416.635 and 416.994a of our rules to 
include the statutory requirement that, at the time of a CDR, a child's 
representative payee must present evidence that the child is and has 
been receiving treatment that is considered medically necessary and 
available for the disabling impairment(s). We also explained how we 
would determine whether and how treatment was medically necessary and 
available.
    We made many other changes to conform our rules to the major 
changes noted above. We also expanded and clarified several rules, 
including sections in the listings, and defined terms related to the 
new regulations. For a complete description of the changes in the 
interim final rules and our reasons for making them, interested readers 
may refer to the preamble to the interim final rules.

The Balanced Budget Act of 1997 (Pub. L. 105-33)

    Pub. L. 105-33, 111 Stat. 251, enacted on August 5, 1997, contained 
two provisions that affect these final rules, and other provisions that 
affected the redeterminations and protected the Medicaid eligibility of 
children who lost SSI eligibility because of the new disability 
standard.
    The amendments affecting these final rules provided the following:
     Pub. L. 104-193 required us to perform a redetermination 
of a beneficiary's eligibility within 1 year after the individual turns 
18. Pub. L. 105-33 changed this requirement and provided that we may 
perform this redetermination either during the 1-year period beginning 
on the individual's 18th birthday, or in lieu of a CDR whenever we 
determine that the individual's case is subject to a redetermination 
(Pub. L. 105-33, section 5522(a)(1); section 1614(a)(3)(H)(iii) of the 
Act).
     Pub. L. 104-193 required us to do a CDR not later than 12 
months after the birth of a child for whom low birth weight is a 
contributing factor material to our determination of disability. Pub. 
L. 105-33 changed this provision to provide that we do not have to do a 
CDR by age 1 if we determine at the time of our initial disability 
determination that the child's impairment(s) is not expected to improve 
by age 1, and we schedule a CDR for a time after the child turns age 1 
(Pub. L. 105-33, section 5522(a)(2)(B); section 1614(a)(3)(H)(iv)(VI) 
of the Act).
    Pub. L. 105-33 also extended the deadline for redetermining the 
eligibility of children who might be affected by the new disability 
standard. Pub. L. 104-193 required us to perform redeterminations 
within 1 year after enactment of the law, or by August 22, 1997. 
Section 5101 of Pub. L. 105-33 extended that date by an additional 6 
months, to February 22, 1998. For any redetermination not performed by 
that date, the law also allowed us to perform the redeterminations ``as 
soon as practicable thereafter.'' Because we do not have regulations 
addressing this redetermination process, this provision of Pub. L. 105-
33 does not affect these final rules.
    Finally, section 4913 of Pub. L. 105-33 required States to continue 
Medicaid coverage for disabled children who were receiving SSI as of 
the enactment date of Pub. L. 104-193 if they lost SSI eligibility 
because of the changes to the definition of disability. The authority 
for making the determination about restored or continued Medicaid 
eligibility remains with the States, so this change in the law also 
does not affect these final rules.

Actions Since We Published the Interim Final Rules

    Many of the public comments, most of which were submitted during 
the first half of 1997, expressed concerns about how we would conduct 
the required redeterminations of the eligibility of children who 
qualified under the old disability standard. Many commenters expressed 
concerns that the law required us to do the redeterminations too 
quickly and that the new rules were unfamiliar to our adjudicators. 
Some commenters were concerned that we would not get proper evidence. 
They were especially concerned that we would not get sufficient 
evidence from schools because we would conduct many redeterminations in 
the summer. We also received allegations that the State agencies were 
purchasing substandard consultative examinations and using them to 
cease children's eligibility.
    Some commenters expressed concern that children and their families 
would not understand that they could appeal determinations that they 
were no longer eligible and that they could continue to receive 
benefits while appealing. Some were concerned about how the 
redeterminations and loss of benefits would affect children and their 
families in the future.
    In response to these and other concerns, Commissioner Kenneth Apfel 
promised, during his confirmation hearings before the Senate Finance 
Committee in 1997, to perform a ``top-to-bottom'' review of how we 
implemented the changes made to the SSI childhood disability program 
that were required by Pub. L. 104-193. He ordered this review as his 
first official act after being confirmed as Commissioner, and we issued 
a report, Review of SSA's Implementation of New SSI Childhood 
Disability Legislation, on December 17, 1997. (Pub. No. 64-070. The 
report is also available at our public Internet site: www.ssa.gov/policy/child.htm.)
    The report showed that, overall, the vast majority of the 
redeterminations were handled properly. The review indicated that SSA 
and the State agencies making disability determinations for us had done 
a good job of implementing the new provisions, but found some 
inconsistencies in the application of the rules and in compliance with 
our instructions. Commissioner Apfel immediately ordered several 
corrective actions to address these issues.
    In the report, we identified three specific areas of concern, and 
the corrective actions we would take above and beyond our normal 
actions:

1. Children Classified in Our Records as Having Mental Retardation

    Of the approximately one million children on the SSI rolls in 
December 1996, 407,000 were shown on our records with our diagnosis 
code for mental retardation. Eighty percent of these children were not 
subject to redetermination under Pub. L. 104-193. However, at the time 
of the report, we had found ineligible under the new law slightly more 
than half of the approximately 79,500 children whose eligibility we 
reviewed and who were coded in our computer records as having mental 
retardation. Our review concluded that part of this could be attributed 
to the fact that, historically, some children were coded using the

[[Page 54750]]

diagnosis code for mental retardation incorrectly or because we did not 
have a diagnosis code for the child's impairment. Over half of the 
cases in which benefits had been ceased involved children who were not 
diagnosed with mental retardation at the time of the cessation. Of 
these cases, almost 40 percent involved a learning disability and 
others involved borderline intellectual functioning. Thus, in a large 
number of cases with the diagnosis code for mental retardation, the 
children did not have mental retardation, were never thought to have 
mental retardation, but were shown in our records with that diagnosis 
code.
    However, our review also showed concerns about the accuracy of 
these redeterminations, especially for children with IQs in the range 
of 60 to 70 and slightly above 70. The concerns included whether 
listings were misapplied and whether children with mental retardation 
who had IQ scores above 70 incorrectly lost eligibility.
    To address the concerns, we reviewed the cases of all children who 
had a diagnosis code for mental retardation if we had found they were 
ineligible after a redetermination or if we had denied their initial 
applications on or after August 22, 1996. We automatically reopened and 
issued new determinations in the cases of all children who were coded 
as having mental retardation and who had an IQ score of 75 or below. We 
also provided additional training to all of our adjudicators on how to 
evaluate claims involving children with mental retardation under the 
new rules, before they reviewed the cases again.

2. Quality of Case Processing

    We found that the concerns about sufficient case development were 
unfounded, especially the concerns that we would not get school records 
we needed and that our consultative examinations were inadequate. 
However, we did find some issues related to the quality of case 
processing.
    In some States, we found problems in cases that were ceased based 
on a ``failure to cooperate.'' Our procedures require additional 
attempts to contact a child's parent or legal guardian when this 
individual does not respond to official notices regarding the child's 
eligibility. Our procedures also require us to make special efforts to 
identify and contact another adult or agency responsible for the 
child's care. We also require written documentation of those attempts. 
We determined that in some cases all required contacts were not 
attempted or they were not documented in the case file. Therefore, we 
reviewed all ``failure to cooperate'' cessations to ensure that proper 
procedures were followed. When those reviews indicated deficiencies, we 
gave families another opportunity to cooperate and to have their 
benefits reinstated during the new redetermination process, including 
any benefits that would have been paid since the month when payments 
ceased. We also provided additional written instructions and training 
on this issue to our personnel.
    We also found that, although the accuracy of the redeterminations 
was above the regulatory threshold for accuracy nationally, it varied 
by State and by type of impairment, particularly for certain mental 
disorders other than mental retardation. Therefore, we instructed all 
of our State agencies to review a portion of the cases they had ceased 
on redetermination. Depending on the quality assurance results in each 
State, we identified cases involving both physical and mental 
impairments (other than mental retardation) for review based on the 
cases that had the greatest likelihood of error within a given State. 
When we found deficiencies in a redetermination, the case was reopened, 
developed if necessary, and the determination revised if appropriate.
    Before these reviews began, we provided additional training to all 
our adjudicators on how to evaluate mental impairments other than 
mental retardation and on the evaluation of speech disorders in 
combination with cognitive limitations. We also issued Social Security 
Ruling (SSR) 98-1p, on the evaluation of speech disorders in 
combination with cognitive limitations. (63 FR 15248 (1998))

3. Appeals and Requests for Benefit Continuation During Appeal

    When we notified families (or other payees) that a redetermination 
found that a child no longer qualified, the notice also advised them of 
their legal rights. This information included:
     How to ask for a reconsideration,
     How to request continuation of benefit payments while 
appealing, and
     How to obtain legal assistance to appeal.
    Concerns were raised that the cessation notice was hard to 
understand. We also received reports that some families were 
discouraged from filing appeals or were not told about free legal 
services. We received reports that some families were discouraged from 
asking for benefit continuation during their appeals, especially 
because the overpayment waiver process was not fully explained to them. 
Some families did not understand that they might not have to pay back 
the benefits they received during the appeal if the appeal decision was 
still unfavorable.
    We made changes to clarify our procedures and provided training as 
the redeterminations proceeded. However, we found that these actions 
helped only those children whose cases were redetermined later in the 
process and that some individuals who did not appeal--and some who 
appealed, but did not request benefit continuation--did not understand 
their rights.
    To address this concern, on February 18, 1998, we sent a new notice 
using simpler language to families (or other payees) of all children 
who lost their SSI eligibility under the new childhood disability rules 
and did not appeal. The notice gave them another chance to appeal and 
to ask for benefit continuation during the appeal. We also sent a new, 
simpler notice to families (or other payees) of all children who had 
appealed their initial redeterminations but who did not request benefit 
continuation during the appeals. The notice gave them another chance to 
request benefit continuation during the appeal. Both notices included 
information on the right to request waiver of any overpayment that 
might result from continuing benefits during appeal and on how to get 
free legal assistance.
    On March 18, 1998, we also sent new, simpler notices to individuals 
who had attained age 18 and who lost their eligibility because of the 
changes in Pub. L. 104-193. We sent these notices to individuals who 
did not appeal or who appealed but did not request benefit continuation 
during their appeal.
    We also took several other actions. For example, we provided a 
``script'' for employees in our Field Offices and Teleservice Centers 
to follow when informing claimants of their appeal and benefit 
continuation rights. The script ensured that all families received the 
same information. We also made concerted efforts to ensure that 
families knew about available legal assistance by providing toll-free 
numbers for the American Bar Association's (ABA's) Children's SSI 
Project referral service in our Field Offices, Teleservice Centers, and 
on our Internet site. We also included the ABA's toll-free numbers for 
legal assistance on our notices for States in which toll-free numbers 
were available.
    In addition to the corrective actions outlined above, we have taken 
many other actions. For example, we continue to monitor case quality 
through our quality assurance system. We conducted

[[Page 54751]]

several training classes in addition to those noted above and trained a 
``cadre'' of specialists in childhood disability who served as experts 
in their respective regions. We are now studying several issues related 
to childhood disability, which we describe in the public comments 
section of this preamble, including the effects on families of the loss 
of eligibility resulting from Pub. L. 104-193.
    These final childhood rules represent another step in our actions 
to ensure that all children who meet the SSI eligibility requirements 
receive their benefits. The final rules respond to extensive comments 
on the interim final rules that we received from a wide range of child-
serving professional organizations as well as advocacy, legal, and 
family groups and individuals. Their comments, together with our 
experience, input from individual medical and other professionals, and 
other actions, support the adjustments made in the interim final 
regulations that we publish today as the final childhood disability 
regulations.

Explanation of the Effective Date

    As we noted in the effective date section of this preamble, these 
final rules will be effective on January 2, 2001. We have delayed the 
effective date of the rules to give us time to provide training and 
instructions to all of our adjudicators and to revise Form SSA-538 and 
other forms and notices before we implement the final rules. The 
interim final rules will continue to apply until the effective date of 
these final rules. When the final rules become effective, we will apply 
them to new applications filed on or after the effective date of the 
rules. We will also apply them to the entire period at issue for claims 
that are pending at any stage of our administrative review process, 
including claims that are pending administrative review after remand 
from a Federal court.
    With respect to claims in which we have made a final decision, and 
that are pending judicial review in Federal court, we expect that the 
court's review of the Commissioner's final decision would be made in 
accordance with the rules in effect at the time of the final decision. 
If the court determines that the Commissioner's final decision is not 
supported by substantial evidence, or contains an error of law, we 
would expect that the court would reverse the final decision, and 
remand the case for further administrative proceedings pursuant to the 
fourth sentence of section 205(g) of the Act, except in those few 
instances where the court determines that it is appropriate to reverse 
the final decision and award benefits, without remanding the case for 
further administrative proceedings. In those cases decided by a court 
after the effective date of the rules, where the court reverses the 
Commissioner's final decision and remands the case for further 
administrative proceedings, on remand, we will apply the provisions of 
these final rules to the entire period at issue in the claim.

Summary of Final Rules

    We are adopting the interim final rules with the changes set out 
below, and are publishing only those rules that we have changed. For a 
summary of the rules we are adopting without change, see the 1997 
interim final rules (62 FR 6408).
    For clarity, we refer to the changes we are making here as 
``final'' rules and to the rules that will be changed by these final 
rules as the ``interim final'' rules. We also use the past tense to 
describe the interim final rules we are changing. However, it must be 
remembered that these final rules do not go into effect until January 
2, 2001. Therefore, the interim final rules will still be in effect 
until that date.

Changes to Sec. 416.902  General Definitions and Terms for This Subpart

    We are adding a new definition to this section to help simplify the 
language of our regulations. We define the term ``the listings'' to 
mean the Listing of Impairments in appendix 1 of subpart P of part 404 
of this chapter. Throughout these final rules, we use the new term in 
the phrase ``medically or functionally equals the listings'' to replace 
longer phrases that refer to appendix 1 of subpart P of part 404 of 
this chapter. For example, when we say that we consider whether an 
impairment(s) medically or functionally ``equals the listings'' we mean 
``whether an impairment medically or functionally equals in severity 
the criteria of a listing in appendix 1 of subpart P of part 404 of 
this chapter.''
    We are making this change because of changes we are making in the 
functional equivalence provisions of the regulations in response to 
public comments. As we explain more fully under the explanation of 
changes to final Sec. 416.926a, we will no longer refer to specific 
listings when we determine functional equivalence. The change also 
simplifies the language of our rules and removes some inconsistencies 
among various rules.
    We are also including in our current definition of the words 
``you'' or ``your'' the words ``me,'' ``my'' and ``I.'' Under the 
President's plain language initiative, we are changing some of our 
rules to use first-person questions in paragraph and section headings. 
We used this technique in final Sec. 416.987(c), using a question and 
the pronoun ``my'' in the heading, ``When will my eligibility be 
redetermined?'' and in final Sec. 416.987(d), using the pronoun ``I'' 
in the heading, ``Will I be notified?'' Therefore, we need to add a 
definition of these words in Sec. 416.902. In anticipation of similar 
future changes, we are also indicating that we may use the word ``me.'' 
The new terms, which are only editorial, help clarify our rules.

Changes to Sec. 416.924  How We Determine Disability for Children

    In final Sec. 416.924(c), we are adding language to clarify that at 
step two of the sequential evaluation process we consider both whether 
a child has a medically determinable impairment and whether any 
impairment or combination of impairments the child has is ``severe.'' 
In the interim final rules, we did not include the first part of the 
statement.
    The new language only clarifies our rules and helps to make them 
consistent with changes we made in final Secs. 416.924a and 416.926a in 
response to public comments. It is based on our interpretation of step 
two of the sequential evaluation processes for both adults and 
children, as explained in SSR 96-4p. (61 FR 34488 (1996))
    In response to public comments that suggested we include more 
cross-references in our regulations, we changed Sec. 416.924(d)(3) of 
the interim final rules, to final Sec. 416.924(e), ``Other rules.'' 
Section 416.924(d)(3) of the interim final rules provided cross-
references to our rules on meeting, medically equaling, and 
functionally equaling the listings. Final Sec. 416.924(e) now adds 
cross-references to final Secs. 416.924a, 416.924b, and 416.929 in 
addition to cross-referencing the rules on meeting and medically or 
functionally equaling the listings. The last of the new cross-
references is to our rules for the evaluation of pain and other 
symptoms.
    Because of this change, we redesignated paragraph (e) of the 
interim final rules, ``If you attain age 18 after you file your 
disability application but before we make a determination or 
decision,'' as paragraph (f). As we explain below in our explanation of 
the changes in final Sec. 416.924a, we moved the provisions of 
Sec. 416.924(f) of the interim final rules, ``Basic considerations,'' 
to final Sec. 416.924a(a).
    We have not changed Sec. 416.924(g) of the interim final rules, 
``How we will explain our findings.'' Therefore, we are

[[Page 54752]]

not reprinting it in this Federal Register notice. However, by the time 
these rules become effective, we will issue a revised Form SSA-538, 
Childhood Disability Evaluation Form, to reflect the changes in these 
final rules. (See the public comments section of this preamble for more 
information about Form SSA-538.) We also changed some of the language 
throughout Sec. 416.924 for consistency; e.g., to refer to impairments 
that ``equal the listings.''

General Changes in Final Secs. 416.924a and 416.924b

    In the final rules, we extensively reorganized and revised the 
provisions of the interim final rules in Secs. 416.924a, ``Age as a 
factor of evaluation in childhood disability,'' 416.924b, ``Functioning 
in children,'' and 416.924c, ``Other factors we will consider,'' and 
some of the provisions of Sec. 416.926a, ``Functional equivalence for 
children.'' These changes respond to many of the public comments, many 
of which affected more than one section of our rules.
    We are replacing Secs. 416.924a, 416.924b, and 416.924c of the 
interim final rules with final Secs. 416.924a, ``Considerations in 
determining disability for children,'' and 416.924b ``Age as a factor 
of evaluation in the sequential evaluation process for children.'' For 
the most part, the final rules include the provisions of the interim 
final rules. However, in reorganizing the provisions, we found a number 
of redundancies that we eliminated and text we could combine and 
shorten. We also simplified much of the language and expanded some of 
our guidance, as suggested by the commenters. We also deleted some 
sections that we no longer need because of the revisions.
    We made these changes because many public commenters recommended 
that we provide a better explanation of how our provisions on ``other 
factors'' in Sec. 416.924c of the interim final rules apply in 
evaluating childhood disability. Many commenters urged us to clarify 
these rules and to provide more guidance about how we apply the factors 
when we evaluate a child's functioning. Many commenters also suggested 
that we include more factors for our adjudicators to consider when they 
evaluate a child's functioning. Some commenters urged us to incorporate 
information from our operating manuals and training, and to give more 
prominence to these important principles so that they are not 
overlooked. Others asked us to add cross-references throughout the 
childhood disability regulations so that no relevant provisions are 
overlooked.
    In final Sec. 416.924a, we no longer refer to the factors as 
``other'' factors because the comment letters showed that our intent 
was not clear. Our intent in the interim final rules was only to 
include guidance about some of the more important factors we consider 
when we evaluate a child's functioning to decide whether the child has 
a ``severe'' impairment and whether the child's impairment(s) meets or 
equals the listings. But our earlier wording led people to believe that 
we meant to consider the ``other factors'' separately, after an initial 
assessment of a child's functioning, to see whether there are 
additional limitations the child might have based on the ``other 
factors.'' That has never been our intent. Like our consideration of 
symptoms, the factors in this rule are an integral part of our 
evaluation of a child's functioning.
    To demonstrate our intent more clearly, and to give the provisions 
the prominence the public commenters thought was lacking, we moved up 
the provisions of Sec. 416.924c of the interim final rules. Now, the 
provisions on factors we consider when we assess functioning are found 
in final Sec. 416.924a instead of last in the series of childhood 
regulations beginning with Sec. 416.924.
    In the next section of this preamble, we explain the specific 
changes we made in final Secs. 416.924a and 416.924b and our reasons 
for making them.

Specific Changes in Sec. 416.924a Considerations in Determining 
Disability for Children

    Final Sec. 416.924a(a) contains the provisions of Secs. 416.924(f), 
``Basic considerations,'' and 416.924c(a), ``General,'' of the interim 
final rules. We clarified the language of the interim final rules and 
removed redundancies. We also added some examples of medical sources to 
correspond to the existing examples of nonmedical sources, and included 
more examples of nonmedical sources whom we may ask for information.
    The term, ``Other medical sources not listed in Sec. 416.913(a),'' 
which now appears in final Sec. 416.924a(a), refers to medical 
professionals who are not ``acceptable medical sources.'' It is taken 
from a revision to Sec. 416.913(d) (formerly Sec. 416.913(e)) we 
published in the Federal Register on June 1, 2000 (65 FR 34950). In 
those final rules, we also recognize qualified speech-language 
pathologists and certain other specialists as acceptable medical 
sources for evidence of impairments that are within their areas of 
specialty.
    In final Sec. 416.924a(a)(1), we also included a cross-reference to 
our rules in Sec. 416.927, in response to comments that asked us to 
include more cross-references to provisions our adjudicators must 
consider before making their determinations or decisions. That section 
explains how we consider medical source opinion.
    We added a new provision about testing in final 
Sec. 416.924a(a)(1)(ii) to respond to comments recommending that we 
caution our adjudicators against strict adherence to the numerical 
scores of IQ tests and other tests. The new provision restates our 
longstanding policy that we consider all relevant evidence in a child's 
case record. Therefore, we do not consider any piece of evidence in 
isolation, including test scores, and will not rely on test scores 
alone when we decide if a child is disabled. The provision is also in 
part a response to comments that recommended revising the rules to 
include consideration of the standard error of measurement (SEM) that 
professionals use to estimate a score's reliability. The provision 
includes in our rules information we have included in our training 
since 1997. (We explain more about the SEM in the summary of final 
Sec. 416.926a and in our responses to the comments.) We also added a 
cross-reference to Sec. 416.926a(e), which includes several provisions 
on how we consider test scores, especially in final 
Sec. 416.926a(e)(4).
    The last sentence of final Sec. 416.924a(a)(1)(iii), ``Medical 
sources,'' is new in our regulations but reflects our longstanding 
procedure. It explains that we may consider information provided by a 
nonmedical source (e.g., a parent or the child) to be a clinical sign, 
as defined in Sec. 416.928(b), when the medical source has accepted and 
relied on it to reach a diagnosis. This often occurs for children with 
mental disorders, when a psychiatrist or psychologist may accept 
statements made by the child or parents, such as ``my child has 
difficulty sleeping,'' as his or her clinical findings. However, it may 
also occur for children who have other kinds of impairments.
    In final Sec. 416.924a(a)(2), ``Information from other people,'' we 
expanded the guidance we gave in Sec. 416.924(f) of the interim final 
rules. We added new guidance about information we will request from 
early intervention and preschool programs, and provide more guidance 
about the information we will request from schools.
    Final Sec. 416.924a(b), ``Factors we consider when we evaluate the 
effects of your impairment(s) on your functioning,'' incorporates the

[[Page 54753]]

provisions of Secs. 416.924c(b) through (h) of the interim final rules; 
i.e., what we formerly called the ``other factors.'' In response to 
public comments, we expanded the list of factors we will consider and 
incorporated principles from our training and other instructions we 
have used since we published the interim final rules in 1997.
    In final Sec. 416.924a(b)(1), ``General,'' we explain that we must 
consider a child's functioning when we decide whether the child has a 
``severe'' impairment(s) at step two of the sequential evaluation 
process and when we consider functional equivalence at step three. We 
also explain that we will consider a child's functioning when we decide 
whether his or her impairment(s) meets or medically equals the 
requirements of a listing if the listing we are considering includes 
functioning among its criteria.
    In final Sec. 416.924a(b)(2), ``Factors we consider when we 
evaluate your functioning,'' we explain that we will consider any 
factors that are relevant to how the child functions when we evaluate 
his or her impairment or combination of impairments. In response to 
many commenters who thought we should include a reference to pain and 
other symptoms in this section, we added an example of symptoms and 
provided a cross-reference to our rules on evaluating symptoms in 
Sec. 416.929. We also clarified that the factors we list in the 
remainder of the section are only ``some'' of the factors we may 
consider.
    Final Sec. 416.924a(b)(3), ``How your functioning compares to the 
functioning of children your age who do not have impairments,'' is new 
in this section, although it reflects our longstanding policy. It 
explains that when we consider whether a child has functional 
limitations because of his or her impairment(s), we will consider the 
child's functioning in age-appropriate terms; i.e., in relation to 
other children of the same age who do not have impairments.
    In final Sec. 416.924a(b)(3)(ii), we added a corollary to this 
principle. When we consider evidence that formally or informally rates 
a child's functioning, we will consider the standards used by the 
person who did the rating and the characteristics of the group to whom 
the child was compared. We include the familiar example from our 
training and instructions that a child in a special education class who 
is compared to other children in the class is not being compared to 
children of the same age who do not have impairments.
    Final Sec. 416.924a(b)(4) is also new. It specifies in the context 
of our childhood disability rules our longstanding policy that, when a 
child has more than one impairment (i.e., multiple impairments), we 
consider the combined effects of the impairments. We have had a rule on 
this issue (Sec. 416.923) for many years, and specific provisions in 
the interim final rules that addressed the point (e.g., 
Secs. 416.924(a), 416.924(c), 416.924b(a), and 416.926a(a)). The new 
provision is one of our responses to those comments that asked us to 
explain better how we consider ``multiple'' impairments. This provision 
is intended to recognize that limitations resulting from a combination 
of impairments may be greater than the limitations that we might expect 
to find if we looked separately at each impairment; i.e., the 
impairments may have interactive and cumulative effects. We also use 
the word ``comprehensively'' to emphasize that we look at all of these 
effects when we evaluate the child's functioning.
    However, we also explain in the first sentence that we do not 
always need to look at the combined effects of a child's multiple 
impairments. Sometimes we can decide that any single impairment is 
``severe'' or that one of a child's impairments meets, medically 
equals, or functionally equals the listings without considering the 
child's other impairments.
    Final Sec. 416.924a(b)(5), ``How well you can initiate, sustain, 
and complete your activities, including the amount of help or 
adaptations you need and the effects of structured or supportive 
settings,'' incorporates provisions from several interim final rules 
and includes new provisions that respond to public comments. Final 
Sec. 416.924a(b)(5)(i), ``Initiating, sustaining, and completing 
activities,'' incorporates principles from the ``Concentration, 
persistence or pace'' area of functioning in Sec. 416.926a of the 
interim final rules. The principle that a child should be able to 
initiate, sustain, and complete activities independently and at the 
same rate as other children his or her age who do not have impairments 
is inherent in all evaluations of functioning.
    We clarify this principle further in final Sec. 416.924a(b)(5)(ii), 
``Extra help,'' which expands on the guidance we provided in the last 
sentence of Sec. 416.926a(c)(2) of the interim final rules. We 
incorporated this guidance in final Sec. 416.924a because it is 
appropriate whenever we must evaluate a child's functioning, not just 
at the functional equivalence step.
    In the final provision, we explain that an important indication of 
the severity of a child's impairment(s) and its resulting limitations 
is the amount of effort that must be made to help the child function. 
By ``help,'' we mean not only help from parents, medical providers, 
school personnel, or other people, but also the ``help'' a child may 
get from special equipment, devices, or medications in order to 
complete his or her tasks. We may decide that a child has limitations 
compared to other children the same age who do not have impairments 
because of extraordinary efforts that must be made for the child to 
function as well as he or she does.
    Final Sec. 416.924a(5)(iii), ``Adaptations,'' incorporates the 
provisions of Sec. 416.924c(e) of the interim final rules. We clarified 
some of the earlier language and reinforced the requirement that we 
compare a child's functioning to the typical functioning of children 
the same age who do not have impairments.
    We also deleted two examples. We deleted the word ``appliances'' 
from the previous second sentence because it is included in the concept 
of ``assistive devices'' that appears in the same sentence. We also 
deleted the ``hearing aids'' example from the third sentence. Hearing 
aids are not a good example of an adaptation that may allow a child to 
function normally because they do not restore normal hearing the way 
eyeglasses may restore essentially normal vision.
    Final Sec. 416.924a(b)(3)(iv), ``Structured or supportive 
settings,'' corresponds to Sec. 416.924c(d) of the interim final rules, 
``Effects of structured or highly supportive settings.'' We deleted the 
word ``highly'' because we are clarifying that we consider how a child 
functions in all settings compared to the typical functioning of same-
age children who do not have impairments. The basic principles that 
apply to the evaluation of functioning in ``highly'' supportive 
settings also apply to the evaluation of a child's functioning in other 
supportive settings.
    We also made a number of editorial changes for clarity, added 
several examples, and expanded some statements from the interim final 
rules to better explain our intent.
    Final Sec. 416.924a(b)(6), ``Unusual settings,'' is new. It 
includes in our rules our longstanding policy that a child's 
functioning in an unusual situation, such as a consultative examination 
or a one-to-one setting, may not be typical of his or her functioning 
in routine settings on a day-to-day basis. It is another example of our 
policy that we do not consider any single piece of evidence in 
isolation from the other relevant evidence in the case record.
    We added this section because some commenters noted correctly that 
there are medical impairments (such as

[[Page 54754]]

attention deficit hyperactivity disorder) that may not be as manifest 
in unusual settings as they are in typical settings, such as at home 
and in school. A child with such an impairment may appear to be 
relatively normal in an unusual setting but be very limited in others. 
Other impairments can be more or less severe at any given point in 
time, so that a child may appear more or less limited on any single 
examination or in any one-to-one or other unusual setting. We included 
this principle in our training after we implemented the interim final 
rules, so the new provision only reflects our existing policy.
    Final Sec. 416.924a(b)(7), ``Early intervention and school 
programs,'' incorporates, expands, and clarifies provisions of 
Sec. 416.924c(g) of the interim final rules. To respond to comments 
requesting more explanation of how other factors apply when we evaluate 
a child's limitations, we added more discussion about how we consider 
evidence from early intervention services, preschools, and schools. We 
also provide specific guidance about how we use school records 
(subparagraph (ii) of the final rule) and how we consider assessments 
from early intervention services or special education programs or 
accommodations in school (subparagraphs (iii) and (iv) of the final 
rule).
    We also made clear in this section, and throughout the rules, that 
``school'' includes preschool. We also explain better (in subparagraph 
(v) of the final rule) how the impact of chronic or episodic 
impairments or a child's need for therapy or treatment may interfere 
with his or her ability to participate in school activities.
    Final Sec. 416.924a(b)(8), ``The impact of chronic illness and 
limitations that interfere with your activities over time,'' 
incorporates the relevant provisions of Sec. 416.924c(b), ``Chronic 
illness,'' from the interim final rules. Much of interim final 
Sec. 416.924c(b) addressed the effects of treatment as it related to 
chronic illness and was not specifically relevant to this heading. 
Therefore, we moved those provisions into the section on treatment, 
final Sec. 416.924a(b)(9). In response to a comment, we also added new 
second and third sentences in the paragraph to explain better the 
importance of considering functioning over time when a child has a 
chronic impairment that is characterized by episodes of exacerbation 
(worsening) and remission (improvement). For these new sentences, we 
adopted language we use in the third paragraph of section 12.00D of the 
adult mental disorders listings. This principle is equally applicable 
to children and adults, and to both physical and mental impairments.
    Final Sec. 416.924a(b)(9), ``The effects of treatment (including 
medications and other treatment),'' incorporates the provisions of 
paragraphs (c) (``Effects of medication''), (f) (``Time spent in 
therapy''), and (h) (``Treatment and intervention, in general'') of 
Sec. 416.924c of the interim final rules. We expanded the list of 
factors we will consider when we evaluate the effects of a child's 
medications. We deleted the reference to ``marked and severe functional 
limitations'' that was in the third sentence of interim final 
Sec. 416.924c(c) to clarify that the factors in Sec. 416.924a apply 
when we evaluate a child's functioning beginning at step two of the 
sequential evaluation process. We also clarified language and added 
examples and new language reinforcing some of the principles discussed 
above.

Specific Changes in Final Sec. 416.924b Age as a Factor of Evaluation 
in the Sequential Evaluation Process for Children

    As already noted, we redesignated Sec. 416.924a from the interim 
final rules as final Sec. 416.924b. We revised the heading of the 
section to make clearer that it addresses the consideration of age at 
steps two and three of the sequential evaluation process for children.
    Except for editorial changes and one addition, final 
Sec. 416.924b(a), ``General,'' is the same as Sec. 416.924a(a) of the 
interim final rules. We expanded the provision on children who may be 
too young to be tested, now in final Sec. 416.924b(a)(4), with language 
we adopted from section 114.00D4 of the listings. The new language 
explains that we will consider all relevant information in the child's 
case record, including ``other generally acceptable methods consistent 
with the prevailing state of medical knowledge and clinical practice 
that will help us evaluate the existence and severity'' of the child's 
impairment(s). This is not a policy change since it only clarifies what 
we do in all cases, including for infants and toddlers.
    Final Sec. 416.924b(b), ``Correcting chronological age of premature 
infants,'' is identical to Sec. 416.924a(b) of the interim final rules. 
For that reason, we are not reprinting it in the Federal Register.
    We are deleting all of Sec. 416.924a(c) of the interim final rules, 
primarily because these provisions are better addressed elsewhere in 
these final rules. For example, the provisions of Sec. 416.924a(c)(1) 
of the interim final rules, which address how a child adapts to an 
impairment, are better addressed by several provisions in final 
Sec. 416.924a, as already explained above, and Sec. 416.926a. The 
principles in Sec. 416.924a(c)(3)(ii) of the interim final rules, which 
explained the interactive and interdependent process of development 
within a child, are better addressed by final Sec. 416.926a(c), ``The 
interactive and cumulative effects of an impairment or multiple 
impairments,'' and throughout the general and age-specific descriptions 
of each domain in final Sec. 416.926a. Likewise, using work-related 
activities to measure functioning in adolescents is now addressed by 
the age-specific domain descriptors found in Sec. 416.926a.
    We deleted some provisions for consistency. The final rules 
emphasize our longstanding policy that we consider the specific effects 
of each child's impairment(s) on his or her functioning based on the 
evidence in the case record. Some provisions in Sec. 416.924a(c) of the 
interim final rules, however, provided more general guidance about how 
impairments might theoretically affect children who were older or 
younger. We originally included this guidance in our rules in 1991 when 
we first instituted the functional equivalence and IFA policies because 
we thought it would help our adjudicators better understand how 
impairments might affect children at different ages. However, we 
believe that we no longer need such guidance in our rules and that our 
focus on the need to assess the specific limitations each child has 
regardless of age is clearer without it.

Deletion of Sec. 416.924b of the Interim Final Rules

    Because of the changes we made in final Secs. 416.924a and 
416.924b, and in final Sec. 416.926a, as described below, we deleted 
all of Sec. 416.924b of the interim final rules, ``Functioning in 
children.'' Section 416.924b(a), ``General,'' merely restated the 
principle that we consider all of a child's limitations when we 
evaluate whether the child has a ``severe'' impairment and whether the 
impairment causes ``marked and severe functional limitations.'' Since 
we make identical and similar statements repeatedly throughout the 
final rules, it was unnecessary to retain this statement.
    Section 416.924b(b) of the interim final rules, ``Terms used to 
describe functioning,'' included definitions of the terms ``age-
appropriate activities,'' ``developmental milestones,'' ``activities of 
daily living,'' and ``work-related activities.'' However, we used the 
term ``work-related activities'' only in Sec. 416.924a(c)(4) of the 
interim final

[[Page 54755]]

rules. We did not use the other terms at all in the interim final 
rules, although we used the phrase ``age-appropriate'' and the word 
``development'' in Sec. 416.926a to describe the method of functional 
equivalence based on ``broad areas of functioning.'' We believe the 
changes we made throughout the final rules to indicate that we consider 
a child's functioning in relation to children of ``the same age who do 
not have impairments'' adequately cover the idea we intended by the 
term ``age-appropriate activities.'' Likewise, final Sec. 416.926a 
continues to refer to a child's ``development'' and incorporates 
appropriate principles with examples for each age category. As already 
noted, we also included examples of work and work-related activities in 
the sections describing the domains for adolescents in final 
Sec. 416.926a.

Changes to Sec. 416.925  Listing of Impairments in Appendix 1 of 
Subpart P of Part 404 of This Chapter

    We revised Sec. 416.925(b)(2) of the interim final rules to make it 
consistent with other changes we made in these final rules, especially 
changes in final Sec. 416.926a. As we explain below when describing the 
changes to the functional equivalence rules, we will no longer refer to 
specific listings when we consider whether an impairment functionally 
equals the listings. In keeping with this change, we removed the 
reference to the childhood mental disorders listings in our definition 
of ``listing-level severity'' in final Secs. 416.925 and 416.926a. We 
also updated the references to include the new domains described below 
and provided a better cross-reference to the rules defining the terms 
``marked'' and ``extreme.''

Changes to Sec. 416.926a  Functional Equivalence for Children

    We received many comments about our functional equivalence rules. 
Most commenters raised at least one of the following issues:
     Many commenters said that our rules on functional 
equivalence were too complicated and suggested that we simplify them. 
Some commenters noted that it was difficult for adjudicators to 
determine which listings contained ``disabling functional 
limitations.''
     Most commenters focused on the method of functional 
equivalence that was based on ``broad areas of development or 
functioning,'' set out in Sec. 416.926a(c) of the interim final rules. 
Some of these commenters noted that we did not provide the same number 
of areas of functioning for all children and thought that this was 
unfair to children who had fewer functional areas in which to be rated. 
These commenters pointed out that for children age 1 to 3 we provided 
only three areas of functioning, while for older children we provided 
five.
     Many commenters asked us to separate communication from 
cognition in the cognitive/communicative area of functioning.
     Many commenters asked us to provide better ways to 
evaluate physical impairments. Many of these commenters suggested that 
we include another area of functioning to evaluate physical disorders 
in addition to the ``motor'' domain we added in 1997.
     Many commenters also asked us to clarify the rules to 
explain more clearly how we evaluate combinations of impairments, 
particular kinds of impairments, and particular kinds of functional 
limitations.
     A number of commenters asked us to clarify how we consider 
the results of testing, including the SEM, and how we define the terms 
``marked'' and ``extreme.''
For a more detailed summary, see the public comments section of this 
preamble. As we note there, we adopted or partially adopted these 
comments in the final rules. In many cases, we incorporated specific 
suggestions made by commenters.
    Final Sec. 416.926a has the following key features:
     Simplified rules. Under the interim final rules, we 
provided four methods for evaluating functional equivalence. (See 
Secs. 416.926a(b)(1)-(b)(4) of the interim final rules.) In the final 
rules, we are providing a single method, based only on domains of 
functioning. The methods were somewhat redundant and, by far, the most 
commonly used one was based on broad areas of development or 
functioning, which we call ``domains'' in the final rules. The word 
``domain'' is consistent with the language used in the conference 
report on the legislation, and much simpler than the phrase we used in 
the interim final rules, which meant the same thing.
     Delinking from specific listings. We also simplified the 
final rules so that adjudicators will no longer consider or refer to 
any of the listings when deciding functional equivalence. Although we 
provided self-contained domain criteria under the ``broad areas of 
development or functioning'' method in the interim final rules, we 
still required reference to listing 112.02 or 112.12 when a child's 
impairment(s) functionally equaled the listings under this method. The 
other three methods of functional equivalence in the interim final 
rules required adjudicators to identify specific listings containing 
disabling functional limitations and to refer to them when they found 
functional equivalence.
    Also, a frequent criticism of the broad areas of functioning was 
that they were ``the same'' as the domains in the childhood mental 
disorders listings because they used the same names. Although this 
criticism was inaccurate, it is true that the names of the domains in 
the interim final rules confused many people. The new domains are 
specifically designed for determining functional equivalence and are 
completely delinked from the mental disorders and other listings.
     New domain for evaluating the physical effects of 
impairments. We added a sixth domain, called ``Health and physical 
well-being,'' for evaluating the physical effects of both physical and 
mental impairments, except for motor functioning limitations, which 
will be evaluated in a separate domain (``Moving about and manipulating 
objects''). This domain includes guidance that was relevant to the 
prior functional equivalence method called ``episodic impairments'' 
(see Sec. 416.926a(b)(3) of the interim final rules) but also includes 
new guidance in response to public comments.
     The same number of domains for all children. All six 
domains in the final rules apply to children from birth to the 
attainment of age 18. We agreed with the commenters that it is possible 
to describe domains that apply to all ages. We provide general 
descriptions of the domains and specific examples of typical and 
atypical functioning for each domain. In five of the six domains (all 
except ``Health and physical well-being''), we provide detailed 
descriptors for each age group.
     Communication addressed in the appropriate domains. In the 
final rules, we no longer have a domain called ``cognitive/
communicative.'' The different aspects of communication are addressed 
in each domain that they affect.
     Guidance on evaluating multiple impairments. We added more 
guidance and reminders about evaluating the functional limitations that 
result from combinations of impairments throughout these final rules, 
including in final Sec. 416.926a. Final Sec. 416.926a(c), ``The 
interactive and cumulative effects of an impairment or multiple 
impairments,'' addresses this issue specifically.
     Clarification of how we use test results. We did not adopt 
the comments that asked us to include specific reference to the SEM in 
our rules or to apply SEMs in certain ways. However,

[[Page 54756]]

in response to these comments, we clarified that we do not rely on any 
test score alone. We also clarified our longstanding policy that we may 
consider a child to have ``marked'' or ``extreme'' limitations with 
test scores that are slightly higher than the levels we use to define 
those terms. However, we explain that we may also consider the 
converse; i.e., that a child with test scores that appear to be in the 
``marked'' or ``extreme'' range may not have such limitations. We 
consider test scores in the context of all the evidence in the case 
record.
     Better general guidance for considering all types of 
impairments. In final Secs. 416.924a and 416.926a, we provide better 
guidance for evaluating the effects of all impairments, including a 
number of specific impairments singled out by some commenters. In 
addition to improvements we made in final Secs. 416.924a and 416.926a 
already noted, we also included more detailed guidance and examples for 
evaluating limitations in each of the domains. We included examples 
that we believe will be useful for evaluating both physical and mental 
impairments.
    We continue to define listing-level severity as ``marked'' 
limitation in two domains or an extreme limitation in one domain.
    Therefore, although we delinked our policy of functional 
equivalence from reference to specific listings, we continue to use the 
phrase ``functionally equals the listings,'' to underscore that the 
impairment(s) must be of listing-level severity.
    The following is an explanation of the specific changes we made in 
final Sec. 416.926a.
    We revised Sec. 416.926a(a), ``General,'' to reflect the changes to 
our functional equivalence policy in these final rules. We deleted the 
reference to ``any listed impairment that includes disabling functional 
limitations among its criteria'' in the first sentence because we no 
longer refer to specific listings. We deleted the second and third 
sentences for the same reason. We replaced the discussion with an 
explanation that an impairment or combination of impairments 
functionally equals the listings if it is of listing-level severity. We 
also included the definition of listing-level severity from 
Sec. 416.925(b)(2) of the interim final rules, revised to reflect other 
changes; i.e., to show that the impairment(s) must result in marked 
limitations in two domains or an extreme limitation in one domain.
    We expanded the guidance in final paragraph (a) about what we 
consider when we evaluate a child's functioning. The first sentence of 
paragraph (a) of the interim final rules indicated that, when we assess 
functional limitations, we consider what the child ``cannot do'' 
because of his or her impairment(s). In the final rules, we clarify 
that we consider what the child ``cannot do, [has] difficulty doing, 
need[s] help doing, or [is] restricted from doing'' because of his or 
her impairment(s). This clarifies that we consider all of a child's 
limitations, even when the child has some ability to do an activity. We 
also added a reminder that we consider the interactive and cumulative 
effects of all the child's impairments for which we have evidence and 
references to other relevant rules we consider, especially those found 
in final Sec. 416.924a.
    We replaced Secs. 416.926a(b), ``How we determine functional 
equivalence,'' and 416.926a(c), ``Broad areas of development or 
functioning,'' of the interim final rules with a series of new 
paragraphs. Paragraph (b) of the interim final rules explained the four 
methods we could use to determine functional equivalence. Since 
functional equivalence is now simplified into one method, we deleted 
those provisions of the interim final rules. However, we incorporated 
some of the principles of these paragraphs into other sections of the 
final rules, as already noted in the explanation of the changes in 
final Sec. 416.924a and the summary of the key provisions of final 
Sec. 416.926a.
    We deleted the statement in the last sentence of interim final 
Sec. 416.926a(b) about when we will complete a form SSA-538. This 
restatement of our policy in Sec. 416.924(g) was redundant and 
unnecessary. A greater concern was that it was the only place in our 
rules where we repeated this requirement. We believe this may have 
given the mistaken impression that we do not complete the form when we 
decide whether a child's impairment(s) is severe, meets a listing, or 
medically equals a listing, as required in Sec. 416.924(g).
    In final Secs. 416.926a(b), ``How we will consider your 
functioning,'' we explain that we use the word ``activities'' to mean 
everything a child does at home, in childcare, at school, and in the 
community. In final paragraph (b)(1), we list the new domain headings. 
They are:
     Acquiring and using information,
     Attending and completing tasks,
     Interacting and relating with others,
     Moving about and manipulating objects,
     Caring for yourself, and
     Health and physical well-being.
    As we explain below, the new domain names largely clarify the broad 
areas of development or functioning we used in the interim final rules. 
In most cases, they rename, and to some extent reorganize, the prior 
areas of functioning, incorporating features of the other methods of 
functional equivalence we have deleted. They also respond to the major 
public comments about the domains by applying the same domains to 
children from birth to age 18, addressing the component parts of 
communication (explained later in this preamble) in the appropriate 
domains, providing better ways to evaluate the physical effects of 
impairments, and clarifying how we evaluate the effects of combinations 
of impairments and particular impairments.
    We believe that the revised domains will be easier for our 
adjudicators to apply and for the public to understand. We believe that 
the new approach, together with the changes in final Secs. 416.924a, 
provides a clearer, more comprehensive way to assess the effects of a 
child's impairment or combination of impairments on his or her 
functioning.
    Final Secs. 416.926a(b)(2) and (b)(3) provide guidance and 
reminders based on key provisions of final Secs. 416.924a and 
416.926a(a). Paragraph (b)(2) explains that there are six basic 
questions we will consider when we evaluate a child's functioning under 
the functional equivalence provisions. The six questions focus on the 
child's abilities and limitations, where the child has difficulty 
(i.e., at home, in childcare, at school, or in the community), the 
quality of any limitations (i.e., difficulty initiating, sustaining, or 
completing activities), and the kind, extent, and frequency of help the 
child needs. Final paragraph (b)(3) is based on Sec. 416.926a(c)(2) of 
the interim final rules. It provides reminders of the kinds of evidence 
we will consider when we evaluate functioning under this section. In 
response to a public comment, we added cross-references to our rules on 
evidence and purchasing consultative examinations.
    Final Sec. 416.926a(c), ``The interactive and cumulative effects of 
an impairment or multiple impairments,'' is based on and clarifies our 
intent in Secs. 416.924a(c) and 416.926a(c)(1) of the interim final 
rules. We included this paragraph in response to comments suggesting 
that we provide better guidance about these issues and that we simplify 
our functional equivalence policy.
    The provisions of the paragraph are based on our longstanding 
policy that we consider the limitations that result from a single 
impairment or a combination of impairments in any domains that are 
affected. The interim

[[Page 54757]]

final rules recognized that these effects may be in areas that ``may 
not be obviously relevant,'' and provided (in Sec. 416.924a(c)(3)(ii)) 
examples of young children who might have delays in developing motor 
skills or bonding emotionally because of visual or hearing impairments. 
We decided to delete the examples because they focused only on the 
youngest children and certain kinds of impairments. We also believed 
that the provision was misplaced with the rules on how we consider age 
because it provided guidance on how we consider functioning. Therefore, 
it was more appropriate to include this guidance in final 
Secs. 416.924a and 416.926a.
    Final paragraph (c) assumes that at this step in the sequential 
evaluation process for children we have already established the 
existence of at least one medically determinable impairment that is 
``severe.'' Therefore, we explain that at this point we are looking 
primarily at the extent of the limitation of the child's functioning. 
We look at all of the child's activities to determine the child's 
limitations or restrictions and then decide which domains to use. (Of 
course, when we decide whether the child's medically determinable 
impairment(s) is ``severe'' we will look comprehensively at the 
combined effects of all of the child's impairments, unless we are able 
to decide the issue by looking at each of the child's impairments 
separately. We explain this point above and in Sec. 416.924a(b)(4) of 
the final rules.)
    We evaluate the limitations that result from a medically 
determinable impairment(s) in any single domain or in as many domains 
as are affected. We explain that any given activity may involve the 
integrated use of many abilities and skills. We also explain that any 
single impairment may have effects in more than one domain.
    In final Sec. 416.926a(d), ``How we will decide that your 
impairment(s) functionally equals the listings,'' we provide the basic 
rule for functional equivalence. To functionally equal the listings, an 
impairment or combination of impairments must be of ``listing-level 
severity''; i.e., it must result in marked limitations in two domains 
of functioning or extreme limitation in one domain. The disability must 
also meet the duration requirement; i.e., it must have lasted or be 
expected to last for 12 months or to result in death. The provision is 
based on ``listing-level severity'' and the provisions of 
Secs. 416.902, 416.925(b), and 416.926a(c) of the interim final rules. 
However, in the third sentence of this paragraph, we provide explicitly 
that we will not compare a child's functioning to the requirements of 
any specific listing to underscore that we are delinking the policy 
from direct reference to the listings.
    Final Sec. 416.926a(e), ``How we define `marked' and `extreme' 
limitations,'' is based on Sec. 416.926a(c)(3) of the interim final 
rules. We reorganized and clarified the provisions from the interim 
final rules and expanded some of our guidance.
    We begin with a general paragraph that reviews the major principles 
of all of the final rules. In subparagraph (ii), we repeat and expand 
our guidance about formal testing that appears in final 
Sec. 416.924a(a)(1), which was based on Sec. 416.924(f) of the interim 
final rules. The final provision explains that standard scores, such as 
percentiles, can be converted to standard deviations, and that we 
consider such scores with all the other evidence when we determine 
whether a child has a marked or extreme limitation in a domain.
    In final Sec. 416.926a(e)(2), ``Marked limitation,'' we reorganized 
the provisions of Sec. 416.926a(c)(3)(i) from the interim final rules 
to provide the general definition of ``marked'' first. We explain that 
a child has a ``marked'' limitation in a domain when his or her 
impairment(s) ``interferes seriously'' with functioning in the domain 
before we provide the more specific definition based on standardized 
testing. We expanded the definition to refer to limitations in the 
ability to independently initiate, sustain, and complete activities to 
be consistent with our other revisions and to clarify the definition in 
response to comments. For the same reasons, we also revised the 
statement that ``marked limitation may arise when several activities or 
functions are limited or even when only one is limited.'' The final 
sentence provides that there may be a marked limitation when a child's 
``impairment(s) limits only one activity or when the interactive and 
cumulative effects of [the] impairment(s) limit several activities.''
    In addition to retaining the other definitions of ``marked'' from 
the interim final rules, we also added a new one explaining that 
``marked'' is the equivalent of functioning we would expect to find on 
standardized testing with scores that are at least two, but less than 
three, standard deviations below the mean. This includes in our rules a 
longstanding instruction from the training manual we provided to our 
adjudicators when the interim final rules were implemented. (Childhood 
Disability Training, SSA Office of Disability, Pub. No. 64-075, March 
1997.)
    In subparagraph (e)(2)(ii), we clarified our rule defining 
``marked'' in terms of a developmental quotient for children who have 
not attained age 3. We continue to provide that such a child will have 
a ``marked'' limitation if he or she is functioning at a level that is 
more than one-half but not more than two-thirds of his or her 
chronological age. However, in response to a comment, we clarified that 
if there are standard scores from standardized testing in the case 
record, these scores take precedence over the more subjective estimate 
based on functioning relative to chronological age.
    In subparagraph (e)(2)(iii), we retain our rule that a ``marked'' 
limitation is shown with a valid score that is two standard deviations 
below the mean, but less than three standard deviations, on a 
standardized test. We clarified the provision to indicate that the test 
must be a ``comprehensive standardized test designed to measure ability 
or functioning in [the] domain'' and that the test results and the 
child's day-to-day functioning in the domain-related activities must be 
consistent. This is another example of a clarification we made in 
response to comments that asked us to explain better how we will 
consider test scores.
    Subparagraph (e)(2)(iv) is new. It provides an alternative 
definition for the term ``marked'' as it applies to the sixth domain of 
functioning, ``Health and physical well-being.'' As we explain below, 
this new domain considers the physical effects of both physical and 
mental impairments. It includes (but is not limited to) such effects as 
frequent exacerbations and frequent illnesses, and incorporates aspects 
of the functional equivalence method based on episodic impairments 
found in Sec. 416.926a(b)(3) of the interim final rules.
    The definition in this subparagraph describes the frequency of 
effects that demonstrate a ``marked'' limitation in this domain. Under 
the final rules, a child may have a marked limitation in this domain if 
he or she has illnesses or exacerbations from his or her impairment(s) 
that result in significant, documented symptoms or signs occurring on 
an average of 3 times a year or once every 4 months, each lasting 2 
weeks or more. We provide alternative criteria for children who have 
more frequent, but shorter, episodes or less frequent, but longer, 
episodes.
    We adopted this definition from other rules and guidance. We 
provide a similar criterion in section 14.00D8 in

[[Page 54758]]

the Immune System section of part A of our listings, which we use when 
we decide whether an individual meets the criteria of listing 14.08N. 
An individual who has HIV infection meets that listing with 
``repeated'' manifestations of the illness as defined in 14.00D8 and 
``marked'' limitations in one other specified domain. We also have 
operating instructions that we use to evaluate the frequency of 
exacerbations of serious mental disorders in adults under the fourth 
paragraph B criterion for most listings under section 12.00. It 
provides essentially the same criteria for assessing frequency in that 
domain as used here in the final childhood disability rules. (See 
Program Operations Manual System, DI 22511.005D.)
    In both cases, the frequency criterion is the equivalent of one 
``marked'' limitation, and individuals must still show ``marked'' 
limitation in a second domain to meet the listings. We believe the 
standard is appropriate for evaluating the frequency of exacerbations 
or illnesses in children too. The other definitions of the term 
``marked'' in these final rules will also apply to the health and 
physical well-being domain when appropriate.
    In final paragraph (e)(3), ``Extreme limitation,'' we made 
revisions to parallel the revisions in paragraph e)(2). To maintain 
consistency with the provision that describes a ``marked'' limitation 
when an impairment(s) ``seriously'' interferes with functioning in the 
domain, we added a parallel definition for extreme limitation when an 
impairment(s) ``very seriously'' interferes with functioning.
    We also clarified the definition based on a public comment. In 
Sec. 416.926a(c)(3)(ii)(C) of the interim final rules, we defined 
``extreme'' as having ``no meaningful function in a given area.'' A 
commenter thought that this was a stricter standard than we intended, 
equivalent to a requirement that a child be completely unable to 
function. To clarify that this was not our intent, we deleted the 
phrase and added in the final rule that, while ``extreme'' is the 
rating we use for the worst limitations, it does not necessarily mean a 
total lack or loss of ability to function. It means that the impairment 
very seriously limits functioning, and is the equivalent of the 
functioning we would expect to find on standardized testing with scores 
that are at least three standard deviations below the mean.
    For the domain of ``Health and physical well-being,'' we provide 
that episodes of illness or exacerbations of a child's impairment(s) 
``substantially in excess of'' the criteria in paragraph (e)(2)(iv) 
will also constitute ``extreme'' limitation. However, we caution that 
impairments that occur with such frequency or for such extended periods 
of time that they could be rated as ``extreme'' under this definition 
should meet or medically equal a listing in most cases.
    In final paragraph (e)(4), ``How we will consider your test 
scores,'' we expand on the guidance we provided in final 
Sec. 416.924a(a)(1), focusing more on issues relating to the rating of 
the domains for functional equivalence. We added the paragraph in 
response to comments that suggested we include provisions specifying 
how we would apply the SEM. The paragraph explains that we may find 
that a child has a ``marked'' or ``extreme'' limitation with a test 
score that is slightly higher than the levels provided in this section 
if other information in the case record indicates that the child's 
functioning is seriously or very seriously limited because of his or 
her impairment(s). This means that we may find that a child has 
``marked'' or ``extreme'' limitation in a domain even if he or she has 
test scores that are slightly higher than is required to satisfy the 
definitions of those terms based on standard deviations. Conversely, we 
explain that we may find that a child does not have a ``marked'' or 
``extreme'' limitation even if the test scores are at the levels 
provided in this section if other information in the case record 
indicates that the child's functioning is not seriously or very 
seriously limited. We provide examples to illustrate both situations.
    We also incorporate in the final rules guidance from our 
adjudicator training on how to consider IQ testing (Childhood 
Disability Evaluation Issues, SSA Office of Disability Pub. No. 64-076, 
March, 1998). This guidance applies to all testing, and explains how we 
resolve material inconsistencies between a child's test scores and the 
other information in the case record. We explain that, while it is our 
responsibility to resolve any material inconsistencies, the 
interpretation of a test is primarily the responsibility of the 
professional who administered the test. If necessary, we may recontact 
the individual who administered the test for further clarification.
    However, we may also resolve an inconsistency with other 
information in the case record, by questioning other individuals who 
can provide us with information about a child's day-to-day functioning, 
or by purchasing a consultative examination. We also explain what we 
will do when we do not rely on a test score.
    We believe these final provisions address most of the concerns of 
the commenters who asked us to include provisions recognizing the SEM. 
All measures of functioning are less than perfectly precise and have 
some range of error around their scores.
    The SEM is one method of quantifying this variation. It is a 
statistical unit that can be used to construct a confidence interval. 
This interval reflects the reliance that can be placed in the accuracy 
of an obtained test value. For clinical purposes, the SEM is considered 
to fall symmetrically around a test score. Therefore, the confidence 
interval is described by the obtained score plus and minus the desired 
number of SEMs.
    For example, given an obtained score of 72 and a hypothetical SEM 
of 5 points, one can say with 68 percent confidence that the examinee's 
true score falls somewhere within the range of 67 to 77. To be 95 
percent confident, we must go to plus and minus two SEMs, or a score 
range of 62 to 82.
    SEMs differ from test to test, summary score by summary score 
(e.g., full scale IQ, verbal IQ, and performance IQ), and by age. 
Tables of SEMs are typically published within test manuals.
    Because of the imprecision inherent in all psychometric devices, 
professionals who administer tests do not rely on the test scores 
alone. They consider as much other information as is available to help 
them judge whether a given test score is a meaningful measurement of a 
child's ability (or in some tests, the child's functioning) in the area 
addressed by the test.
    For example, the major professional manuals defining mental 
retardation provide a rough clinical rule of thumb that IQs in the 
range of 50 to 75 indicate one level of mental retardation, but caution 
that the child's adaptive functioning must also be considered and must 
be consistent with the abilities suggested by such scores before a 
diagnosis of mental retardation may be made. Of course, the 
professional who administered the test is in the best position to 
determine the precision of his or her findings.
    We believe that the final rules are the best possible way to 
recognize the less than perfect precision of test results. They 
recognize that we cannot rely on any given test score without 
considering it in the context of all the other evidence. They explain 
that we will generally defer to the judgment of the person who gave the 
test about the accuracy of the results, and they incorporate into our 
rules procedures for adjudicators to follow when they question test 
results.

[[Page 54759]]

    In final Sec. 416.926a(f), ``How we will use the domains to help us 
evaluate your functioning,'' we provide general information about the 
domains and how we will use them. Each domain description in final 
paragraphs (g) through (l) begins with a general description of the 
kinds of activities that should be evaluated under the domain in terms 
of what a child of the same age who does not have impairments is 
expected to be able to do.
    Then, each domain description (except ``Health and physical well-
being,'' which contains examples only of limitations) includes two 
kinds of examples: ones to illustrate typical functioning of children 
who do not have impairments, generally presented by age category, and 
ones to illustrate limitations. The examples are not all-inclusive, and 
we will not require our adjudicators to develop evidence about each 
specific example. They are intended only to help our adjudicators 
understand better some of the kinds of activities and limitations they 
should evaluate within each domain when this information is in the case 
record.
    We also explain that the limitations do not necessarily describe 
``marked'' or ``extreme'' limitations, only limitations of functioning 
within the domain. We must consider all of the information in the case 
record when we decide whether there is a ``marked'' or ``extreme'' 
limitation in a domain.
    Final Sec. 416.926a(g), ``Acquiring and using information,'' is, in 
part, the successor to the prior area of functioning called cognition/
communication. In response to public comments about including 
communication in that area, these final rules recognize that 
``communication'' comprises speech and language, and that language is 
used both for learning and for interacting and relating. Therefore, we 
address the three components of communication (speech, language used 
for learning, and language used for interacting and relating) in the 
domains that are appropriate to the function.
     Final paragraph (g)(1)(i) recognizes that the ability to 
acquire information, or learn, requires perceptual, sensorimotor, 
language, and memory processes that allow the child to acquire the 
fundamental skills of reading, writing, and doing arithmetic.
     Final paragraph (g)(1)(ii) recognizes that the ability to 
use information, or think, employs those same processes, through visual 
and verbal reasoning, to solve problems, make choices, develop ideas, 
and construct arguments or theories.
     Paragraph (g)(2) provides some examples of activities in 
``Acquiring and Using Information'' typical of children in our 
designated age groups.
     Paragraph (g)(3) provides examples of some limitations in 
this domain.
    Final Sec. 416.926a(h), ``Attending and completing tasks,'' 
incorporates aspects from two prior areas of functioning. It includes 
some of the former area, ``Responsiveness to Stimuli,'' which applied 
only to children from birth to the attainment of age 1, and aspects of 
the former area, ``Concentration, Persistence, or Pace,'' which applied 
only to children from age 3 to the attainment of age 18. As with all of 
the domains in the final rules, this domain now applies to children of 
all ages.
    The domain recognizes how attention evolves from an infant's 
earliest response to all types of environmental stimuli, to a school-
age child's capacity to focus on certain stimuli (and ignore others) in 
a formal learning situation, and then eventually to an adolescent's 
capacity to maintain attention in work or work-like tasks.
     Paragraph (h)(1)(i) describes attention in terms of level 
of alertness, concentration, and the initiating, sustaining, and 
changing of focus needed to perform tasks.
     Paragraph (h)(1)(ii) further details the role of attention 
in physical and mental effort, in allaying impulsive thinking and 
acting, and in performing tasks at an appropriate pace, within 
appropriate timeframes.
     Paragraph (h)(2) provides some examples of activities in 
``Attending and Completing Tasks'' typical of children in our 
designated age groups.
     Paragraph (h)(3) provides examples of some limitations in 
this domain.
    Final Sec. 416.926a(i), ``Interacting and relating with others,'' 
includes all aspects of social interaction and relationship with 
individuals or groups (in formal, informal, or intimate contexts) as 
well as the speech and language skills needed to communicate 
effectively in all social settings. This domain incorporates the prior 
area of ``Social Functioning,'' but now includes the ability to use 
speech and the aspect of language needed to interact and relate in 
social contexts (called ``pragmatics'').
     Paragraph (i)(1)(i) discusses interacting with others as 
the broad set of social behaviors a child uses with any other person, 
whether in a single encounter or on a daily basis.
     Paragraph (i)(1)(ii) discusses relating to others as the 
formation of intimate relationships with particular people, which 
requires interacting skills as well as a wide array of emotional 
behaviors.
     Paragraph (i)(1)(iii) explains that interacting and 
relating entail responding to a variety of emotional and behavioral 
cues, speaking intelligibly, following social rules for conversation 
and interaction, and responding appropriately to others.
     Paragraph (i)(1)(iv) notes that interacting and relating 
occur in all of a child's activities that involve other people and may 
involve only one person or a group. Interacting and relating also occur 
across a wide range of social situations, from participating in school 
activities voluntarily to having appropriate responses to persons in 
authority.
     Paragraph (i)(2) provides some examples of activities in 
``Interacting and relating'' typical of children in our designated age 
groups.
     Paragraph (i)(3) provides examples of some limitations in 
this domain.
    Final Sec. 416.926a(j), ``Moving about and manipulating objects,'' 
is the successor to the prior area of ``Motor Functioning,'' and 
includes gross and fine motor skills.
     Paragraph (j)(1)(i) describes the range of actions 
involved in moving one's body from one place to another, such as 
sitting, standing, balancing, shifting weight, transferring, bending, 
crouching, crawling, and running.
     Paragraph (j)(1)(ii) describes the kinds of actions 
involved in moving, holding, carrying, transferring, or manipulating 
objects.
     Paragraph (j)(1)(iii) discusses the underlying aspects of 
motor skill, such as coordination, dexterity, integration of sensory 
input with motor output, and the capacity to plan, remember, and 
execute controlled motor movements.
     Paragraph (j)(2) provides some examples of activities in 
``Moving about and manipulating objects'' typical of children in our 
designated age groups.
     Paragraph (j)(3) provides examples of some limitations in 
this domain.
    Final Sec. 416.926a(k), ``Caring for yourself,'' incorporates and 
clarifies provisions of the ``Personal'' area in the interim final 
rules. It also incorporates principles from the areas in the interim 
final rules called ``Responsiveness to Stimuli'' and ``Concentration, 
Persistence, or Pace'' that are not covered by the domain for 
``Attending and completing tasks'' in the final rules.
    It includes aspects of the child's ability to appropriately care 
for physical needs (such as feeding, dressing, toileting, and bathing), 
maintain a healthy emotional and physical state by coping with stress 
and changes in his or her environment, and take care of his or her 
health and safety. Development is measured in terms of such things as 
the

[[Page 54760]]

child's increasing sense of independence and competence, ability to 
cooperate with others in meeting physical and emotional wants and 
needs, and increasing independence in making decisions and in taking 
actions involved in caring for himself or herself. Impaired ability is 
manifested by such things as pica (eating non-nutritive or inedible 
objects), self-injurious actions, refusal to take medication, and 
disturbances in eating and sleeping patterns.
     Paragraph (k)(2) provides some examples of activities in 
``Caring for yourself'' typical of children in our designated age 
groups.
     Paragraph (k)(3) provides examples of some limitations in 
this domain.
    Final Sec. 416.926a(l), ``Health and physical well-being,'' is a 
new domain. It incorporates aspects of the two prior methods of 
determining functional equivalence called ``Episodic impairments'' and 
``Limitations related to treatment or medication effects.'' (See 
Secs. 416.926a(b)(3) and (b)(4) of the interim final rules.)
    The domain addresses the cumulative physical effects of physical or 
mental impairments and the impact of their associated treatments or 
therapies on a child's functioning. Consistent with the definition of 
``extreme'' in final Sec. 416.926a(e)(3)(iv), it explains that an 
impairment(s) that causes ``extreme'' limitation in this domain will 
generally meet or medically equal a listing.
     Paragraph (l)(1) takes note of the variety of physical 
effects that a child may experience, such as shortness of breath, 
reduced stamina, poor growth, or pain.
     Paragraph (l)(2) notes that a child's medications or 
treatments may have physical effects that limit the performance of 
activities.
     Paragraph (l)(3) concerns children whose illness may be 
chronic with stable or episodic symptoms, or who may be medically 
fragile and need intensive medical care to maintain health.
     Paragraph (l)(4) provides some examples of limitations in 
health and physical well-being that may affect a child of any age.
    We redesignated Sec. 416.926a(d) of the interim final rules, 
``Examples of impairments that are functionally equivalent in severity 
to a listed impairment,'' as final Sec. 416.926a(m). We revised the 
heading and the opening paragraph to refer to impairments that 
``functionally equal the listings'' consistent with other changes 
throughout these final rules.
    We also deleted examples 5 and 10 and renumbered the remaining 
examples. Example 5 previously referred to any physical impairment(s) 
or combination of physical and mental impairments ``causing marked 
restriction of age-appropriate personal functioning and marked 
restriction in motor functioning.'' The example is no longer 
appropriate because we replaced the domain names and deleted the term 
``age-appropriate'' from these final rules.
    We could have revised the example to reflect the new terms in these 
final rules, but then it would simply repeat the definition of listing-
level severity in final Secs. 416.925 and 416.926a(a). We believe the 
revisions we made throughout final Sec. 416.926a sufficiently clarify 
the principle that example 5 was intended to show.
    Example 10 in the interim final rules referred explicitly to 
listing 112.12. We deleted this example because we are removing 
explicit reference to specific listings from our functional equivalence 
rules.
    We also redesignated Sec. 416.926a(e) of the interim final rules, 
``Responsibility for determining functional equivalence,'' as final 
Sec. 416.926a(n). Apart from the redesignation, there are no changes in 
the rule.

Changes to Sec. 416.987  Disability Redeterminations for Individuals 
Who Attain Age 18

    The only substantive change we made to the interim final rule is to 
incorporate the amendment to section 1614(a)(3)(H)(iii) of the Act made 
by section 5522(a)(1) of Pub. L. 105-33, 111 Stat. 251, 622. Under that 
section, we must perform a redetermination of the disability 
eligibility of children who attain age 18 ``either during the 1-year 
period beginning on the individual's 18th birthday or, in lieu of a 
continuing disability review, whenever the Commissioner determines that 
an individual's case is subject to a redetermination under this 
clause.'' The new provision is found in final Sec. 416.987(c).
    We also revised and shortened the entire section to remove 
redundancies and make it easier to read. These changes are only 
editorial and do not substantively change any provisions of the interim 
final rule.

Changes to Sec. 416.990  When and How Often We Will Conduct a 
Continuing Disability Review

    We revised Sec. 416.990(b)(11) of the interim final rules to 
incorporate the amendment to section 1614(a)(3)(H)(iv) of the Act made 
by section 5522(a)(2)(B) of Pub. L. 105-33, 111 Stat. 251, 622. The 
section explains when we will do a continuing disability review (CDR) 
of the eligibility of a child whose low birth weight was a contributing 
factor material to our determination that he or she was disabled.
    The original provision in Pub. L. 104-193 required us to do a CDR 
by the child's first birthday in all cases. The amendment in Pub. L. 
105-33 changed the provision. Now we can do a CDR after a child's first 
birthday if at the time of the initial determination we determine that 
the child's impairment is not expected to improve by age 1 and we 
schedule a CDR for a date after the child's first birthday.

Changes to Sec. 416.994a  How We Will Determine Whether Your Disability 
Continues or Ends, and Whether You Are and Have Been Receiving 
Treatment That Is Medically Necessary and Available, Disabled Children

    In final Sec. 416.994a(i)(1)(ii), we deleted the word 
``Psychiatric'' in response to a comment that pointed out that 
``Medical management'' in Sec. 416.994a(i)(1)(i) includes medical 
management provided by psychiatrists. We also corrected typographical 
errors and changed the text so it is consistent with the final rules on 
functional equivalence. Otherwise, the section is unchanged.

Other Changes

    We made other changes throughout the rules for consistency with 
changes we have described above, to correct typographical errors, and 
to simplify language. For example:
     In the listings sections revised in the interim final 
rules, we changed the phrase ``medically or functionally equivalent in 
severity to the criteria of a listed impairment'' and variations on 
this phrase to ``medically or functionally equals the listings.''
     In Secs. 416.913(c)(3) and 416.919n(c)(6), we changed the 
names of the domains to reflect the changes in final Sec. 416.926a.

Public Comments

    In response to our request for comments on the interim final rules, 
we received 174 letters from different sources. Most of the comments 
came from advocacy and legal groups that represent children with 
disabilities. Other comments came from organizations representing 
children with specific diseases, disorders, or health problems, and 
from representatives of professional medical and health care 
organizations. We also received comments from several public agencies 
and professional organizations having an interest in these rules. 
Finally, some commenters were parents

[[Page 54761]]

or caregivers of children with disabilities.
    In a number of cases, we received the same comment and 
recommendation from several, and sometimes many, commenters. When this 
happened, the comments and recommendations often used identical or very 
similar language. Several commenters also included statements in their 
letters indicating that, in addition to their individual comments, they 
agreed with the more detailed, comprehensive comments of another 
commenter, generally an advocacy group or coalition of advocates.
    Because many of the comments were detailed, we condensed, 
summarized, or paraphrased them. However, we tried to summarize the 
commenters' views accurately and to respond to all of the significant 
issues raised by the commenters that were within the scope of the 
interim final rules.
    Finally, many of the comments were outside the scope of the interim 
final rules. For example, some comments asked us to change rules that 
were not included in the interim final rules, and many comments 
contained opinions about Pub. L. 104-193 without suggesting changes to 
the interim final rules. In a few cases, we summarized and responded to 
such comments because they raised public concerns that we thought are 
important to address in this preamble. For example, we received many 
comments from people who were concerned about how we were going to 
redetermine the eligibility of children under the requirements of Pub. 
L. 104-193 and we thought it was important to explain what we did after 
the comments were submitted. In most cases, however, we did not 
summarize or respond to comments that were outside the scope of our 
rulemaking. We will retain the comments and consider them if and when 
they are appropriate for other rulemaking actions.

Specific Comments

Appendix 1 to Subpart P of Part 404--Listings Sections 112.00C and 
112.02B2

    Comment: A few commenters expressed concerns about the removal of 
references to behavior from sections 112.00C2 and 112.02B2c(2). One 
thought that this change appeared to target children with ``invisible 
disorders,'' including attention deficit hyperactivity. Another asked 
us to instruct adjudicators not to evaluate lightly children with 
maladaptive behaviors, because these behaviors may indicate the 
presence of a serious mental impairment. Another commenter stated that 
the interim final rules did not adequately capture the behavioral 
expression of mental illness, especially in young children who do not 
have fully developed language skills.
    Response: We removed references to ``behavior'' and ``maladaptive'' 
behavior from the personal/behavioral domain of prior sections 112.00C2 
and 112.02B2c(2) in accordance with the explicit requirements of the 
law, not because we wanted to ``target'' children with specific 
impairments. See section 211(b)(1) of Pub. L. 104-193, 110 Stat. 2105, 
2189. The interim final rules made no changes to listing 112.11, our 
listing for evaluating claims filed on behalf of children who have 
attention deficit hyperactivity disorder, and children with this 
impairment can still meet or medically or functionally equal the 
requirements of the listings.
    We agree with the commenter who thought that children whose mental 
impairments result in behavioral problems should have their claims 
carefully reviewed. In fact, since we published the interim final 
rules, we have taken a number of actions to ensure that all children, 
including those with mental impairments, have their claims evaluated 
correctly and in accordance with the law.
    We conducted training for all our adjudicators in 1997, shortly 
after we published the interim final rules, and emphasized the 
evaluation of all aspects of childhood disability claims, including 
those involving behavioral issues. As we noted earlier in this 
preamble, in late 1997, we also conducted a ``top-to-bottom'' review of 
our implementation of the provisions of Pub. L. 104-193 that affected 
the SSI childhood disability program.
    In the review, we found that about 95,000 children, or about 10 
percent of the children receiving SSI in December 1996, had an 
impairment that likely involved maladaptive behaviors in the prior 
personal/behavioral area of functioning. Of these cases, about 16,500 
children were not affected by the changes in the law because their 
impairments met or equaled the requirements of our listings without 
consideration of the prior personal/behavioral domain. Two-thirds of 
the remaining cases involving maladaptive behaviors required a 
redetermination because they qualified for benefits based on an IFA.
    The ``top-to-bottom'' review, however, indicated that some 
redetermination cases where benefits ceased were not consistently 
processed, including some that involved mental impairments other than 
mental retardation. Consequently, we conducted additional training on 
these issues in the spring of 1998, and required the State agencies to 
review a portion of these cases. The March 1998 training included 
instruction on how to identify behavioral issues and the disorders with 
which they are likely to be associated, and emphasized that we still 
consider the functional limitations resulting from a child's behavior 
in determining whether a child is disabled.
    We disagree with the commenter who thought that the interim final 
rules did not allow us to consider adequately the behavioral aspects of 
a child's mental impairment(s). The interim final rules never precluded 
consideration of functional limitations that result from behavioral 
problems, and our training and policy statements emphasized that fact. 
In the interim final rules, we clarified the description of the social 
area of functioning to emphasize that many impairment-related 
behavioral problems are likely to have their most significant effects 
on a child's social functioning. To reinforce the point further, we 
provided additional training to adjudicators that instructed them to 
consider behavior and outlined the various aspects to evaluate, 
including its nature, intensity, frequency, and duration. Our training 
also emphasized that adjudicators need to consider how behavior is 
affected by interventions.
    We believe that the additional clarifications in the final rules, 
made to respond to these and other comments, further explain the issue. 
We provide descriptions and examples of functional limitations 
throughout the domains to make clearer where we consider the functional 
limitations of children whose physical and mental disorders include 
behavioral manifestations.
    Comment: Two commenters expressed concern about the childhood 
mental disorders listings, stating that they should be adjusted to 
reflect the diagnostic categories in the Diagnostic and Statistical 
Manual of Mental Disorders, Fourth Edition, Washington, DC, American 
Psychiatric Association, 1994 (the DSM-IV). One of these commenters 
believed that using the DSM-IV categories would address the 
``vagueness'' of some mental disorders listings, especially for 
children and adolescents with emotional disturbance. The other 
commenter said that many of the adult and childhood mental disorders 
listings are out of date, in need of revision, and that we should 
regularly update them so that the functional equals concept works more 
equitably.
    Response: We did not adopt the comments because they were outside 
the scope of the interim final rules. The changes we made to the 
listings were only those necessary to implement Pub.

[[Page 54762]]

L. 104-193. We do not have the authority to issue final rules that 
revise the mental disorders listings as extensively as these commenters 
suggested without first proposing changes through notice-and-comment 
rulemaking under the Administrative Procedure Act.
    We appreciate the comment suggesting that we update both the adult 
and the childhood mental disorders listings. We are considering such an 
update and will consider this and the other comments as we prepare any 
proposed revisions.

Section 416.902  General Definitions and Terms for This Subpart

    Comment: Many commenters stated that our interpretation of the 
phrase ``marked and severe functional limitations'' in the interim 
final rules did not properly reflect Congressional intent. These 
commenters supported their position by citing various portions of the 
legislative history of Pub. L. 104-193 and prior versions of the 
legislation that were not enacted into law.
    Response: We did not adopt these comments. These final rules 
continue to define the term ``marked and severe functional 
limitations,'' when used as a phrase, to mean the standard for 
disability in the Act for children claiming SSI benefits based on 
disability. We continue to define this standard in the final rules as 
being a level of severity that meets, medically equals, or functionally 
equals the listings.
    Before we published the interim final rules in 1997, we carefully 
considered the statutory language and legislative history of Pub. L. 
104-193, and the prior versions of the legislation that were not 
enacted into law, in order to determine the appropriate level of 
severity that would result in ``marked and severe functional 
limitations.'' We discussed some of the legislative history that 
influenced our decision on this issue in the preamble to the interim 
final rules. (62 FR 6408, 6409 (1997))
    We have again reviewed the statutory language and legislative 
history of Pub. L. 104-193 and the prior versions of the legislation 
that were not enacted into law. We do not believe that the legislative 
history can fairly be read to preclude us from defining the phrase 
``marked and severe functional limitations'' we did in the interim 
final rules and now in these final rules. The General Accounting Office 
reached a similar conclusion in its report to Congress on our 
development of the interim final rules. (Supplemental Security Income: 
Review of SSA Regulations Governing Children's Eligibility for the 
Program GAO/HEHS-97-220-R, September 16, 1997.) In that report, the GAO 
noted that it found the ``interim final regulations to be consistent 
with the law.'' GAO also stated: ``We believe SSA was well within its 
authority in establishing the new level of severity, and its rationale 
for doing so was well supported.''
    Some commenters supported their position by noting that the Senate 
``rejected'' a disability standard contained in a prior House of 
Representatives'' version of the legislation. This earlier version 
would have explicitly required a child to meet or equal the 
requirements of the listings as they existed as of April 1, 1995, in 
order to be found disabled. These commenters were referring to an early 
version of the legislation, under which ``[e]ligibility, as determined 
by the Commissioner, for cash benefits * * * will be based solely on 
meeting or equalling [sic] the current Listings of Impairments [sic] 
set forth in the Code of Federal Regulations.' H.R. Rep. No. 81 (Pt. 
1), 104th Cong., 1st Sess. 48 (1995). Although the House of 
Representatives passed this bill, the childhood disability standard 
contained in the bill was just one of several alternative standards 
that Congress considered in various bills.
    For example, the childhood disability standard contained in another 
bill would have eliminated the IFA, and would have provided that a 
child would be considered disabled if his or her impairment met the 
requirements of the listings or a functional equivalence standard 
separate from the listings. Another bill would have retained the IFA, 
but required changes to the regulations to provide that a child would 
be considered disabled if he or she had two marked limitations, or a 
``severe'' limitation in one domain.
    Still another bill would have retained the comparable severity 
standard, but clarified it to mean an impairment that was severe and 
persistent and which substantially limited a child's ability to develop 
or function. Under this proposed standard, ``IFA-level severity'' was 
two marked limitations, or one marked and one moderate limitation.
    The Senate's initial version of H.R. 4, the legislation passed by 
the House, proposed a disability standard under which a child could be 
found disabled if he or she had ``marked, pervasive and severe 
functional limitations.'' S. Rep. No. 96, 104th Cong., 1st Sess., 20 
(1995). The Senate later amended its proposal to drop the term 
``pervasive'' from the definition of disability for children, so that 
the version of the legislation enacted in Pub. L. 104-193 provided that 
a child would be found disabled if he or she had an impairment(s) that 
resulted in ``marked and severe functional limitations.''
    The evolution of a childhood disability standard from the prior 
standard of ``comparable severity'' to one explicitly tied to the 
Listing of Impairments as it was in effect on April 1, 1995, to one 
requiring ``marked, pervasive and severe functional limitations'' to 
the final standard, requiring ``marked and severe functional 
limitations,'' does not represent a fundamental rejection of a standard 
based on listing-level severity, as some commenters seemed to assume. 
Rather than rejecting a disability standard based on listing-level 
severity, the changes made by the Senate to the definition of 
disability for children can best be viewed as providing a more flexible 
definition of disability than one explicitly tied to a specific set of 
regulatory criteria in effect on a specific date, as initially proposed 
by the House of Representatives.
    The legislative history of the initial Senate version of the 
legislation, under which a child would be found disabled if he or she 
had ``marked, pervasive and severe functional limitations,'' indicates 
that ``the Listing and the other disability determination regulations 
as modified by the Committee bill properly reflect the severity of 
disability contemplated by the statutory definition.'' S. Rep. No. 96, 
104th Cong., 1st Sess. 18 (1995). Materially identical language appears 
in the legislative history of Pub. L. 104-193, as we discussed in the 
interim final rules and earlier in this preamble.
    Thus, we also disagree with commenters who noted that the Senate's 
removal of the word ``pervasive'' from the definition supported the 
conclusion that the level of severity in the interim final rules was 
stricter than what Congress intended. As we have noted, the material 
legislative history concerning the level of severity intended by the 
respective definitions is substantially identical for each version of 
the legislation. Cf. S. Rep. No. 96, 104th Cong., 1st Sess. 18-20 
(1995) with H.R. Conf. Rep. No. 725, 104th Cong., 2d Sess. 328 (1996), 
reprinted in 1996 U.S. Code, Cong. and Ad. News 2649, 2716 and H.R. 
Rep. No. 651, 104th Cong., 2d Sess. 1385 (1996), reprinted in 1996 U.S. 
Code, Cong. and Ad. News 2183, 2444.
    On a related point, the September 14, 1995, colloquy between 
Senator Dole and Senator Conrad, cited by some commenters to support 
their position, does not indicate that the Senate deleted the term 
``pervasive'' to reject a standard of disability based on marked 
limitations in two domains or extreme

[[Page 54763]]

limitation in one. Rather, this discussion indicates that there was 
concern that the inclusion of the term ``pervasive'' in the earlier 
definition ``implied some degree of impairment in almost all areas of a 
child's functioning or body systems.'' Senator Dole noted that this 
``was not the intent of the earlier proposed change.'' He further noted 
that ``[s]ometimes children will have multiple impairments, sometimes 
they will not.'' 141 Cong. Rec. S13613 (daily ed. September 14, 1995) 
(statement of Sen. Dole).
    Thus, the colloquy indicates that the term was deleted to clarify 
that a child with severe disabilities could be found disabled even if 
he or she did not have multiple impairments that caused some degree of 
impairment in almost all areas of his or her functioning. The interim 
final and these final rules are consistent with that understanding of 
the term ``marked and severe functional limitations.'' We will find a 
child disabled, even if his or her impairment causes limitations in 
only one area of functioning, as long as the limitations are 
sufficiently serious.
    Although we believe that the level of severity reflected in the 
interim final and final rules is consistent with the statutory text and 
legislative history of Pub. L. 104-193, we made a number of changes to 
improve and clarify them. We discuss these changes elsewhere in this 
preamble.
    Comment: Several commenters who objected to a standard of 
disability based on listing-level severity suggested revisions of the 
standard to a specified level of severity less than marked limitations 
in two domains or extreme limitation in one domain. One commenter 
stated that a standard of disability based on listing-level severity 
was inappropriate because the listings describe extreme pathology and 
gross failure of treatment, and, for the most part, do not provide a 
meaningful level of functional ability.
    Commenters proposed a variety of standards for establishing 
disability, including: Marked limitation in one domain and moderate 
limitation in another; marked limitation in one domain and moderate 
limitations in two others; and moderate limitations in three 
``crucial'' areas. Other commenters stated that we should revise the 
rules to provide that children with moderate limitations in multiple 
areas should be found disabled, or suggested other alternatives that 
would have similar results. Other commenters thought we should retain 
or reinstate the IFA.
    Response: We did not adopt these comments, but we have made changes 
in the final rules to address many of the commenters' concerns. As we 
explained above, we believe that the disability standard we adopted in 
the interim final and final rules is consistent with the statutory 
definition of disability in children. We explained our reasons for this 
conclusion above and in the preamble to the interim final rules.
    As the commenters recognized, in enacting Pub. L. 104-193, Congress 
intended that we apply a stricter standard of disability than the one 
used under the prior law. Previously, a child would be considered 
disabled if he or she had an impairment or combination of impairments 
that was of ``comparable severity'' to one that was disabling in an 
adult. Our rules interpreting the comparable severity standard at the 
IFA step contained guidance that illustrated a level of impairment 
severity that generally, though not invariably, would be found 
sufficient to establish comparable severity. See Sec. 416.924e (1996) 
in the rules that preceded the interim final rules. Under these 
regulations, we could find a child disabled if we found on an IFA that 
his or her impairment or combination of impairments resulted in a 
``marked'' limitation in one domain and a ``moderate'' limitation in 
another domain, or if his or her impairment(s) resulted in ``moderate'' 
limitations in three domains. See Sec. 416.924e(c)(1) (i) and (ii), and 
Sec. 416.924e(c)(2)(i) and (ii) (1996).
    Section 211(b)(2) of Pub. L. 104-193, 104 Stat. 2105, 2189, 
specifically directed us to discontinue use of the IFA set forth in 
former Sec. 416.924d and 416.924e. In accordance with that statutory 
directive, we deleted those rules in the interim final rules. We have 
no authority to retain or reinstate the IFA. Furthermore, the 
suggestions to revise the disability standard to include children with 
impairments of less than listing-level severity (e.g., one marked and 
one moderate limitation or three moderate limitations in ``crucial'' 
areas) would, in essence, result in the same level of severity we used 
when we performed an IFA under the prior law.
    We do not believe that it would be consistent with the statutory 
definition of disability to allow a child to be found disabled based on 
one marked and two moderate limitations, or multiple moderate 
limitations, as some commenters suggested. ``Moderate'' limitations 
represent a wide spectrum, ranging from just above ``slight'' to just 
below ``marked.'' Consequently, we do not believe that a standard of 
severity based on moderate limitations, even multiple moderate ones, 
reflects a level of impairment severity that results in marked and 
severe functional limitations.
    We disagree with the commenter who characterized our listings as 
``extreme'' pathology, gross failure of treatment, and no meaningful 
level of functional ability. Our definition of ``listing-level 
severity'' in Secs. 416.902 and 416.925(b) of the interim final rules--
based on marked limitations in two domains or extreme limitation in 
one--made clear that a child could meet the standard without being as 
functionally limited as this commenter indicated.
    We have, however, made many changes to address these concerns. 
Throughout the final rules, we made a number of changes to better 
explain how we consider the combined effects--what we now call the 
``interactive and cumulative effects''--of impairments. For example, we 
clarify in final Sec. 416.926a(e)(2), what we have always intended by 
our statement in Sec. 416.926a(c)(3)(C) of the interim final rules, 
that ``marked limitation may arise when several activities or functions 
are limited or even when only one is limited.'' We have clarified the 
sentence to provide that there may be a marked limitation when a 
child's ``impairment(s) limits only one activity or when the 
interactive and cumulative effects of [the] impairment(s) limit several 
activities.'' We made similar changes in the definition of ``extreme'' 
limitation in final Sec. 416.926a(e)(3). We also clarified our 
definitions of these rating terms and improved our rules for evaluating 
functional limitations. We believe that the changes we made in the 
functional equivalence rules will address many commenters' concerns 
about how cases are evaluated using the childhood disability standard.
    Comment: Some commenters thought that there was ``no justification 
in medical practice'' for our interpretation of the statutory 
definition of disability for children, and that regulations need to 
more accurately reflect the current knowledge-base about what 
constitutes severe disorders in children. These commenters maintained 
that our interpretation would place many children with severe disorders 
at risk of losing their SSI payments.
    A few commenters thought the severity standard represented an 
overreaction to the problem of program abuse, e.g., alleged parental 
``schooling'' (i.e., coaching) of children, or that it was our solution 
to budgetary problems, at the expense of children with disabilities.
    Response: The references to ``medical practice'' and the ``current 
knowledge-base about * * * severe disability in children'' were 
unclear. We do not

[[Page 54764]]

believe that any part of these childhood disability regulations is 
inconsistent with, or contrary to, current medical practice or 
knowledge. Our intent is to fully recognize and fairly adjudicate cases 
of severe disability in children under the standard required by Pub. L. 
104-193. Also, as noted in the previous response and in our summary of 
the final rules, we made many changes that we believe will address the 
commenters' concerns about how we evaluate a child's functional 
limitations within the domains.
    We believe that the summary of our actions since 1997 at the 
beginning of this preamble responds to commenters who expressed concern 
that our interpretation would place many children with severe disorders 
at risk of losing their SSI payments. As we noted there, the 
Commissioner shared their concern and ordered a top-to-bottom review of 
our implementation of the law. As a result of that review, we took a 
number of major actions to ensure that children receiving benefits who 
should not have lost eligibility as a result of the changes in Pub. L. 
104-193 retained their eligibility. The actions we took also helped to 
improve adjudication of new childhood disability claims.
    As noted earlier, we believe that we have implemented Pub. L. 104-
193 as Congress intended. Our interpretation was not an 
``overreaction'' to reports of ``coaching.'' The commenter correctly 
noted that the issue of ``coaching'' of children, which was raised 
several years ago, was addressed in numerous ways before Congress 
changed the definition of disability. We studied the issue ourselves, 
as did the Office of the Inspector General for the Department of Health 
and Human Services, and the General Accounting Office. None of those 
studies found any noticeable incidence of parental coaching of 
children. Of the few instances in which coaching (or malingering) was 
suspected, none involved a finding of disability or eligibility for SSI 
payments.
    Comment: A few commenters suggested that we adopt eligibility 
criteria for other Federal and State programs for the children's SSI 
program. They specifically mentioned programs administered under Part H 
of the Individuals with Disabilities Education Act (IDEA) (now Part C 
of the IDEA, 20 U.S.C. 1431-1445, as a result of the Individuals with 
Disabilities Education Act Amendments of 1997, Pub. L. 105-17, 111 
Stat. 37, 106-123). Some commenters suggested that we adopt the 
decisions made by other agencies.
    Response: We did not adopt the comments. As we noted in both the 
preamble to the interim final rules and earlier in this one, Congress 
provided a specific statutory standard for evaluating disability in 
children under SSI. We do not have the authority to adopt a definition 
from another statute.
    Consistent with our longstanding policy, we cannot adopt disability 
determinations made by any other Federal or State programs. (See 
Sec. 416.904.) The Act requires that the Commissioner of Social 
Security and his delegates, and not another governmental or non-
governmental party, make the determination that a child is or is not 
disabled.
    Comment: One commenter stated that the nature and cost of caring 
and providing support for individuals not properly served early in life 
increases significantly in their adult and aging years. This commenter 
believed that this argued for early intervention and a broader 
interpretation of the regulations.
    Response: As noted above and in the preamble to the interim final 
rules, we believe that the disability standard in these rules is 
consistent with the level of severity intended by the statutory 
definition of disability. However, we believe that the final rules will 
address concerns expressed by this commenter by ensuring that children 
who apply for SSI benefits will have their impairments evaluated fairly 
and in a manner consistent with the law. We also believe that the 
changes clarify our rules and procedures for evaluating the eligibility 
of infants and toddlers by providing the same number of domains of 
functioning and more detailed instructions and examples for them.
    Comment: Several commenters noted that the word ``severe'' had two 
different definitions under the law and that the regulations contained 
at least two instances where the two were used in the same sentence. 
They suggested that we change the regulations to minimize confusion, 
and provided specific language changes.
    Response: We partially adopted the comments. In the final rules we 
revised sentences noted by one commenter that used the word ``severe'' 
twice in different contexts within the same sentence. We also replaced 
many of the references to ``marked and severe functional limitations,'' 
the statutory standard, with phrases indicating that our intent is 
listing-level severity; i.e., that the child's impairment(s) must meet, 
medically equal, or functionally equal the listings, avoiding the use 
of the word ``severe.''
    However, we did not adopt the comments that asked us to replace the 
word ``severe'' in step two of the sequential evaluation process for 
children with another term. We have used this term of art in our 
regulations and other instructions for evaluating disability in adults 
for over 20 years and for children since 1991. We believe that changing 
it now would be confusing.

Section 416.912  Evidence of Your Impairment and Section 416.913 
Medical and Other Evidence of Your Impairment(s)

    Comment: One commenter said we should ask specific, individualized 
questions when requesting information from a treating source, teacher, 
or other individual to ensure the evidence addresses the critical 
issues for the particular applicant's impairment.
    Response: Our operating procedures already instruct the State 
agencies to make requests for information as specific as possible. We 
revise and update our forms for requesting information to ensure that 
we ask for relevant information. For example, we are developing a 
national teacher questionnaire for teachers to report specific 
information about a child's functioning. The State agencies also revise 
their forms as necessary to reflect changes in our rules and the needs 
and practices of their local medical providers, schools, and other 
sources.
    Comment: Several commenters said some children will not have 
resources to obtain a medical professional's opinion about the causes 
of their functional limitations. One commenter thought we should 
provide more assistance to families, especially in rural areas, to help 
them obtain relevant medical evidence for their disabled children. 
Another believed that functional limitations are self-evident, so there 
is no need for other expensive corroboration. One commenter expressed 
concern about parents of children from non-English-speaking households 
who lack a network of medical treating sources to provide evidence.
    One commenter recommended that we emphasize that evidence other 
than symptoms, signs, and laboratory findings can play an extremely 
important role in establishing SSI eligibility. The commenter said that 
evidence from other qualified professionals, such as speech-language 
pathologists, audiologists, occupational and physical therapists, 
educators and early intervention specialists should be used, when 
appropriate, and examples of such evidence should be provided.
    Response: Section 416.912(d) of our regulations has long provided 
that we will make every reasonable effort to help individuals, 
including children and their families, to get medical reports from 
their own medical sources and

[[Page 54765]]

other evidence if we have their permission to do so. Section 416.914 of 
our rules also provides that we will pay for existing medical evidence, 
if there is a charge.
    Under our rules in Secs. 416.917 through 416.919a, we may also ask 
a child to go to one or more consultative examinations to get evidence 
we need to make a determination. There are several reasons we may ask a 
child to undergo a consultative examination, especially to get medical 
evidence when there is no medical source. When we ask a child to go to 
a consultative examination, we pay for the examination. We also have 
procedures to help people who do not speak English when they go to one.
    In many cases, information we receive from schools includes medical 
evidence. Also, we recently revised our rules on medical evidence in 
Sec. 416.913 to recognize school psychologists and speech-language 
pathologists as acceptable medical sources for certain kinds of 
impairments. (See 65 FR 34950.)
    In response to these comments and others, the final rules clarify 
the different sources from whom we may seek evidence of a child's 
medical condition or functional limitations. For example, we added 
references to early intervention programs, preschool, and childcare. We 
emphasized our longstanding policy that school evidence is important 
information about a child's functioning, and added references to other 
important sources of information about functioning, such as physical, 
occupational, and rehabilitation therapists, who may see a child at 
school or elsewhere. Finally, we added cross-references to our rules on 
evidence to final Sec. 416.926a(b)(3), the section on how we consider 
functioning.
    We disagree with the commenter who thought that a child's 
functional limitations are always self-evident. On the contrary, these 
final rules recognize that children may function differently in 
different settings and that some serious limitations may not be 
obvious; for example, when a child appears to be functioning well but 
is in fact receiving extraordinary assistance or supervision in a 
structured setting. In any event, section 1614(a)(3)(H)(i) of the Act 
(which incorporates by reference the provisions of section 223(d)(5)(A) 
of the Act) and Secs. 416.928(a) and 416.929 of our rules specify that 
we need medical evidence (signs, symptoms, and laboratory findings) to 
determine disability.
    These provisions indicate that a claimant's statements of symptoms 
are not by themselves conclusive evidence of disability. We must first 
establish the existence of a medically determinable impairment based on 
evidence from acceptable medical sources. Then, the evidence we use to 
assess the severity of a medically determinable impairment may come 
from both the ``acceptable medical sources'' listed in Sec. 416.913(a), 
and ``other sources'' listed in Sec. 416.913(d)(1) (including 
audiologists, occupational and physical therapists, educators, and 
early intervention specialists). Section 416.912(b)(4) includes a 
cross-reference to the sources listed in Sec. 416.913(d).
    Comment: One commenter thought we should consider assessments 
provided by psychiatric social workers, clinical psychologists and 
clinical nurse specialists, as ``valid and appropriate documentation'' 
of a child's disability.
    Response: We consider licensed or certified psychologists to be 
``acceptable medical sources'' in Sec. 416.913(a)(2) of our 
regulations. As we previously stated, once we find that there is a 
medically determinable impairment with evidence from acceptable medical 
sources, we consider all relevant evidence we have in the case record 
when we decide whether a person is disabled. This may include evidence 
from health care professionals such as psychiatric social workers and 
clinical nurse-practitioners. Evidence from these other health care 
professionals helps us understand how a child's impairment(s) affects 
his or her ability to function, even though these sources are not 
``acceptable medical sources'' for purposes of establishing the 
existence of a medically determinable impairment. This decision 
reflects our determination that there is insufficient standardization 
of their qualifications among the States for us to use them as 
acceptable medical sources.
    Comment: One commenter believed that the regulations should require 
school psychologists or other appropriately qualified mental health 
professionals, familiar with the school context and educational 
disabilities, to be involved in reporting information to us, because 
the way that observations of a child's disability are communicated 
could affect an eligibility determination. The commenter was concerned 
that the interim final rules could ``marginalize[]'' or exclude 
information from schools from the disability determination process. 
Similarly, another commenter requested that we amend the section on 
school attendance in Sec. 416.924c(g) of the interim final rules to 
state that information on school functioning is always relevant and 
must be available.
    Response: The first comment was not clear to us, possibly because 
the letter did not specify language in the interim final rules that the 
commenter believed could lead to the exclusion of information from 
schools and education professionals. We consider reports from school 
professionals to be very important evidence of a child's functioning, 
and we made changes to the final rules to clarify this point.
    We do not require information from school professionals in all 
cases because sometimes we can decide that a child is disabled without 
it, such as when a child's impairment(s) meets the requirements of 
certain listings. We also cannot require school evidence in all other 
cases because sometimes we are unable to get it despite reasonable 
efforts. However, our rules require our adjudicators to try to get 
school records whenever they are needed to make a determination or 
decision regarding a child's disability.
    In addition to strengthening our rules about school evidence, which 
we explained previously, we are taking other actions to improve the 
type of evidence we get from schools. As already noted, we are 
developing a national teacher questionnaire to improve the evidence we 
get from teachers and other educational professionals. We also recently 
issued final rules to make school psychologists, or other licensed or 
certified individuals with other titles who perform the same function 
as a school psychologist in a school setting, ``acceptable medical 
sources'' in Sec. 416.913(a) for the purpose of establishing mental 
retardation, learning disabilities, and borderline intellectual 
functioning.

Section 416.919a  When We Will Purchase a Consultative Examination and 
How We Will Use It

    Comment: Several commenters suggested that we amend the regulations 
to indicate that State agencies will purchase tests to assess 
functioning when relevant or specifically to help establish functional 
equivalence. Others stated that we should require State agencies to 
schedule consultative examinations to obtain standardized testing to 
measure functioning when such testing is appropriate and not available 
from the child's treating source. One commenter also recommended that 
we regularly provide guidance to the State agencies about which tests 
are currently available and reliable to assess functioning for 
different age groups.
    Response: We did not adopt the comments in these final rules. We do 
not have general rules specifying the kinds of tests we purchase in all 
cases and, generally, we do not endorse

[[Page 54766]]

particular instruments in our regulations. Many standardized tests, 
like IQ tests, measure a child's abilities, not functioning, and may or 
may not reliably predict any given child's actual functioning. In some 
cases, there are no standardized tests to measure functioning in 
particular domains or for particular age groups, nor are all test 
instruments widely used or available. In many cases, we do not need to 
purchase standardized tests of ability or functioning because the case 
record contains sufficient information about functioning for us to make 
a determination or decision.
    On the other hand, we agree that standardized testing can help 
improve the uniformity of decisionmaking. For this reason, we stress in 
the final rules the need to request records from early intervention 
programs, preschools, and schools, which often include the results of 
standardized testing. However, as already noted, we repeatedly caution 
our adjudicators not to rely exclusively on such tests because it is 
critical to consider their results in the context of all other evidence 
in the case record.
    Sections 416.917 and 416.919a of our regulations provide for State 
agencies to purchase appropriate consultative examinations when 
evidence in the case record is not sufficient for us to make a 
disability determination or decision. These examinations may include 
standardized tests to assess ability or functioning.
    We believe that the general suggestion that we provide guidance to 
our adjudicators about tests that are currently available and reliable 
is a good one. We have provided such guidance in the past in 
subregulatory documents and will consider whether to do so in the 
future. However, we believe that it would not be feasible for us to 
regularly provide information on all available, reliable tests because 
there are so many of them and new ones are constantly developed. To 
some extent, we must rely on the professional judgment of individuals 
who provide evidence to us and the ability of the individuals who 
adjudicate or review claims to follow what is available in their local 
area and to know which tests are available and appropriate for 
particular cases.
    Comment: Two commenters recommended that we clarify that if 
information received from a treating source, teacher, therapist, or 
other source is not sufficient to make a determination, adjudicators 
must seek additional consultation in order to make a determination 
based on complete and accurate information.
    Response: We agree with these comments, but do not believe that any 
changes are needed in these final rules. Sections 416.917 and 416.919a 
of our regulations already provide appropriate guidance for when to 
purchase a consultative examination. We have, however, included cross-
references to our rules on consultative examinations in final 
Sec. 416.926a(b)(3) in response to these and other comments.

Section 416.919n  Informing the Examining Physician or Psychologist of 
Examination Scheduling, Report Content, and Signature Requirements

    Comment: Several commenters thought that the rules describing a 
complete consultative examination should include more detail about a 
child's functional limitations. They suggested adding a cross-reference 
to the areas of functioning for each age group, and requiring 
consultative examination reports to include an analysis of a child's 
functioning by comparison to the specific areas for the relevant age 
groups. They also recommended adding the appropriate cross-references 
to the rules on consideration of age (Sec. 416.924a of the interim 
final rules), functioning (Sec. 416.924b), other factors 
(Sec. 416.924c), and symptoms, including pain (Sec. 416.929).
    Response: As explained above in the summary of the changes, we 
adopted most of these comments by adding cross-references throughout 
the final rules. In addition, we revised Secs. 416.913(c)(3) and 
416.919n(c)(6), our rules on the content of medical reports and reports 
of consultative examinations, to reflect the new domain names in final 
Sec. 416.926a.

Section 416.924  How We Determine Disability for Children

    Comment: One commenter suggested that we revise the sequential 
evaluation process for children by separating the third step of the 
process (meets, medically equals, functionally equals) into three 
parts. The commenter thought that this would help ensure that 
adjudicators will apply each aspect of the third step before denying a 
claim.
    Response: We did not adopt the comment. We believe that 
adjudicators properly understand and apply the current three-step 
sequential evaluation process. However, we made a number of changes to 
clarify and improve Sec. 416.924, as we explained in the summary of 
changes earlier in this preamble.
    Comment: A few commenters thought that we should require all 
adjudicators, including administrative law judges and administrative 
appeals judges on the Appeals Council, to explain their findings using 
our Form SSA-538, the Childhood Disability Evaluation Form. Others 
thought that we should include the form in the text of the rules or 
make the form widely available to the public, including members of the 
medical community, by publishing the form in the Federal Register or 
posting it on our Internet site. Others suggested specific revisions to 
the form, such as adding cross-references to various rules to the form.
    Response: We did not adopt the comments.
    As we discussed in the preamble to the interim final rules (62 FR 
at 6412), our decision not to require administrative law judges or 
administrative appeals judges on the Appeals Council (when the Appeals 
Council issues a decision) to complete the form was based on the fact 
that these adjudicators issue decisions with detailed rationales and 
findings that explain how they apply the three steps of the sequential 
evaluation process for each child. Administrative law judge and Appeals 
Council decisions are quite different in form from most determinations 
prepared by a State agency because they include a more detailed 
explanation of the findings and conclusions, supported by a narrative 
rationale.
    Consequently, requiring administrative law judges and 
administrative appeals judges to complete Form SSA-538 and append it to 
their decisions would only repeat information that is already contained 
in their decisions. This policy parallels what is done for adult 
disability claims, for which we do not require these adjudicators to 
complete or attach to their decisions residual functional capacity 
assessment forms. However, the final rules do not prohibit the use of 
Form SSA-538 at the hearings or appeals levels as a checklist or to 
help organize information in the record.
    We did not require disability hearing officers in the State 
agencies to complete the form because they also provide detailed 
rationales on a special form that replicates information on Form SSA-
538. However, we plan to issue a new form for disability hearing 
officers to use in childhood disability cases that will be specific to 
these final rules.
    Although our forms are widely available to the public in our local 
offices, we do not include the text of any of our forms in our rules 
because they are not part of our substantive rules. Moreover, including 
Form SSA-538 in the rules would codify it and unnecessarily limit our 
flexibility to

[[Page 54767]]

change it as needed without undertaking rulemaking proceedings.
    However, we agree with commenters who recommended that we revise 
the form. We are revising the form to be consistent with the changes in 
the final rules, and plan to have it ready by the time these rules go 
into effect. When we revise the form, we will consider ways in which we 
can ensure that it continues to be made available to the public, 
including the suggestions from the commenters.

Section 416.924b  Functioning in Children, Interim Final Rules

    Comment: One commenter objected to the following statement in 
Sec. 416.924b(b)(3): ``Ordinarily, activities of daily living are most 
important as indicators of functional limitations in children aged 3 to 
attainment of age 16, although they may be used to evaluate children 
younger than age 3.'' The commenter believed this statement ignores the 
importance of considering school functioning and social relationships.
    Response: We agree that the statement could have been confusing. 
For this and other reasons described earlier in this preamble, we 
deleted the provision and all the terms previously defined in 
Sec. 416.924b, including ``activities of daily living.''

Section 416.924c  Other Factors We Will Consider, Interim Final Rules

    Comment: Several commenters recommended that we provide more 
specific guidance to adjudicators about how to consider ``other 
factors'' when evaluating disability. Some suggested that we link the 
``other factors'' rules specifically to those for functional 
equivalence either by cross-references or by citing the areas of 
functioning affected by ``other factors'' considerations. A number of 
commenters recommended that we incorporate more detailed guidance from 
our operating instructions on ``other factors'' into the regulations. 
These commenters recommended that we clarify that:
     Structured settings or other highly supportive 
environments may appear to improve a child's functioning when the 
child's impairment(s) results in functional limitations outside the 
setting;
     A child may appear less impaired on a single examination 
than the evidence over time may show; and that
     Treatment may cause side effects that result in functional 
limitations.
    Response: We adopted the substance of all of these comments, 
although we did not necessarily duplicate text from our prior operating 
manual sections. As explained above in the summary of the changes, we 
significantly improved the ``other factors'' section of the rules. See 
final Sec. 416.924a, ``Considerations in determining disability for 
children.'' We believe it is now a more comprehensive rule that expands 
and clarifies our guidance for considering the various individual 
factors, including some that are addressed in these comments. 
Provisions of the final rules that address specific factors mentioned 
in the comments are found in final Sec. 416.924a(b)(5) (structured and 
supportive settings), new Sec. 416.924a(b)(6) (one-time examinations, 
such as consultative examinations), and Sec. 416.924a(b)(9) (medication 
and other kinds of treatment).
    Comment: One commenter suggested that we explain that other factors 
could increase the severity of a limitation in a specific area. This 
commenter noted that the presence of a significant ``other factor'' 
should allow an adjudicator to find a greater degree of limitation than 
would exist without consideration of the factor(s). The commenter 
provided an example of a child who has a moderate limitation and uses 
an assistive device. The commenter believed that such a child should be 
found to have a marked limitation.
    Response: We clarified the rules in response to this and other 
comments, but not in the specific way recommended. The purpose of the 
section on ``Other factors'' in the interim final rules was to provide 
guidance about some of the factors we consider when we evaluate a 
child's functional limitations, in addition to the objective medical 
findings and the child's symptoms. They are not additional factors to 
apply after we evaluate functioning, but are an integral part of the 
functional analysis. In response to this and other comments, we 
clarified all of the ``other factors'' rules in final Sec. 416.924a and 
clarified in final Sec. 416.926a that, at the functional equivalence 
step, we first look at a child's functional limitations in any domain 
that is affected.
    We do not agree with the commenter's example, but it is to some 
extent addressed by several of the final provisions, especially final 
Sec. 416.924a(b)(5). In that section, we explain that when we rate a 
child's functioning we consider the amount of extra help or adaptation 
the child may need to function as well as he or she does compared to 
other children of the same age who do not have impairments. Thus, we 
consider the need for an adaptation when we consider how seriously a 
child's functioning is limited.
    However, that does not mean that we automatically presume that a 
child with an unspecified ``moderate limitation in motor functioning'' 
has a ``marked'' limitation merely because he or she uses an adaptive 
device. Apart from the fact that these rules do not define a 
``moderate'' limitation, the example was too nonspecific. As we explain 
in final Sec. 416.924a(b)(5), we consider how well a child functions by 
examining how independently the child is able to initiate, sustain, and 
complete his or her activities despite his or her impairment(s), 
compared to children of the same age who do not have impairments. We 
also clarify in these final rules our longstanding policy that we 
consider each child's impairment(s) and the functional limitations that 
result from it in any and all of the affected domains.
    Comment: A number of commenters recommended that we include in the 
list of other factors the ``risk factors'' that were proposed by some 
of the individual experts who gave us information to help us formulate 
the childhood disability regulations in 1991. Some commenters suggested 
that applicable ``risk factors'' would include: biological factors 
(e.g., malnutrition, anemia and recurrent infections); factors related 
to health care (e.g., less than optimal treatment availability); a 
history of abuse and neglect; multiple foster home placements; 
separation from family; and ``toxic environment.'' The commenters 
recommended these risk factors because they believed they are 
objectively observable and are considered indispensable by the 
professional communities when evaluating pediatric impairments.
    Response: We did not adopt the comments that asked us to include 
specific ``risk factors,'' although we expanded the list of factors in 
final Sec. 416.924a that we will consider when evaluating a child's 
functioning. We also revised the areas of functioning to consider more 
specifically physical effects of impairments when we decide functional 
equivalence.
    We addressed the issue of ``risk factors'' extensively in earlier 
versions of the childhood disability rules. We first addressed the 
issue in 1991 when we published regulations in response to the Zebley 
decision (56 FR 5534, 5551 (1991)). We received a number of identical 
public comments in response to those rules and again addressed the 
issue when we published revised rules in 1993 (58 FR 47532, 47552, 
47575 (1993)). As we made clear in those earlier rules, we do consider 
what the

[[Page 54768]]

commenters called ``risk factors'' to the extent that they affect a 
child's medical status and functioning. However, some of the other 
factors recommended by the commenters are not relevant to a 
determination of disability. Interested readers may read a more 
extensive discussion of our reasons for not adopting this comment in 
those earlier publications.
    Comment: One commenter suggested that we strengthen the language 
regarding periods of remission because with medication, intervention, 
and therapy, many children experience periods of adequate functioning 
and require more intensive treatment and intervention only during 
periods of deterioration. The commenter believed that a period of 12 
``contiguous'' months of disability may not be appropriate for such 
children, and that the variation in the expression of ``severe mental 
impairment'' is not adequately addressed in the regulations and may 
lead to some children being inappropriately disqualified.
    Response: We adopted the comment by clarifying how we evaluate 
chronic impairments, especially in final Sec. 416.924(b)(8), where we 
added new sentences to address the comment. We explain in that section 
that we recognize that when a child has a chronic impairment(s), his or 
her functioning may vary considerably over time and that we need to 
take into account the child's ability to function over time. This means 
that we will take into account any variation in a child's level of 
functioning to determine the impact of a chronic illness on his or her 
ability to function.
    However, we do not agree with the suggestion that a child with a 
chronic impairment should not have to show disability over a continuous 
period of 12 months. The Act requires that a child be disabled for a 
continuous period of 12 months (or be expected to be disabled for a 
continuous period of 12 months), unless the impairment is expected to 
result in death.

Section 416.926  Medical Equivalence for Adults and Children

    Comment: Several commenters recommended that we clarify this 
section to ensure that adjudicators will consider all relevant 
evidence, not just symptoms, signs and laboratory findings, when we 
make a finding regarding medical equivalence.
    Response: We agree with the commenters' concerns that the 
regulation could be misinterpreted. Our policy is that the phrase 
``medical evidence only'' in Sec. 416.926(b) excludes consideration of 
only the vocational factors of age, education, and work experience. 
Other than these vocational factors, in accordance with 
Sec. 416.926(a), we consider all relevant evidence in the case record 
when we make a finding regarding medical equivalence.
    This issue was raised in the decision in Hickman v. Apfel, 187 F.3d 
683 (7th Cir. 1999). In Hickman, the Court of Appeals interpreted our 
language in Sec. 416.926(b) to preclude an adjudicator from relying on 
evidence other than evidence from a medical source when making a 
finding regarding medical equivalence. The Hickman decision differs 
from our national policy by requiring adjudicators to consider only a 
narrow definition of medical evidence, that is, evidence from medical 
sources, in determining medical equivalence and not permitting the use 
of other relevant evidence. In contrast, we interpret ``medical 
evidence'' broadly, to include not just objective test results or other 
findings reported by medical sources, but other information about an 
individual's medical conditions and their effects, including the 
individual's own description of his or her impairments. Thus, the 
Court's decision that medical equivalence is decided based solely on 
evidence from medical sources interprets the ``medical evidence only'' 
language of the regulation more narrowly than we intend.
    On May 3, 2000, we published an acquiescence ruling, AR 00-2(7), 
for the Hickman decision (65 FR 25783). As we noted in that 
acquiescence ruling, we intend to clarify the regulations at issue in 
Hickman through the rulemaking process (65 FR at 25785). The concerns 
raised by the commenters here were focused on the title XVI 
regulations, the regulations for SSI benefits. We believe, however, 
that similar concerns apply to our regulations under title II of the 
Act, the regulations for Social Security Disability Insurance benefits, 
20 CFR 404.1526. Since clarifying the title II regulations would be 
outside the scope of this rulemaking proceeding, we intend to consider 
the commenters' concerns on this issue when we clarify the regulations 
in response to Hickman.
    Comment: A few commenters suggested that we provide examples of 
impairments that we consider to be medically equivalent to a listed 
impairment, as we did for functional equivalence in Sec. 416.926a(d) of 
the interim final rules. The commenters believed that such examples 
would be useful to adjudicators. One commenter believed that the 
examples should clarify how a child can establish medical equivalence 
when the impairment is in the listings, but the child is either missing 
a criterion of a listing or presents with a listed criterion but at a 
level less severe than required by the listing.
    Response: We did not adopt the comment because it is outside the 
scope of this rulemaking process. We will consider the suggestions, and 
if we decide to adopt them will issue an appropriate notice of proposed 
rulemaking in the Federal Register.

Section 416.926a  Functional Equivalence for Children

    Comment: A number of commenters thought that the functional 
equivalence policy was too complicated or vague. These commenters 
asserted that adjudicators would be unable to apply the policy 
consistently and meaningfully, and would improperly deny applications 
when they were in doubt about how to apply the rules. Other commenters 
said the regulation did not provide a workable framework for 
determining whether one or more impairments functionally equal a listed 
impairment.
    The commenters made various suggestions. Some commenters wanted us 
to provide additional information, examples, and guidance about how to 
apply each functional equivalence method, or to specifically instruct 
adjudicators to apply the policy. Others suggested that we simplify the 
policy, because it was too difficult for adjudicators and the public to 
determine which listings had ``disabling functional limitations'' among 
their criteria. One commenter suggested that we include a section-by-
section guide of the functional consequences contained in the listings 
because the list of impairments is very long and complicated. One 
commenter recommended that we incorporate in the regulations more 
detailed and specific explanations, definitions, and examples to help 
clarify the process for establishing functional equivalence.
    Some commenters recommended that we delink the functional 
equivalence policy from the listings. One commenter recommended that we 
adopt one simple, easily understood method for determining functional 
equivalence rather than four methods.
    Response: As noted in the summary of changes, we made a number of 
changes in response to these comments. We simplified the process for 
determining functional equivalence to a single method, delinked it from 
explicit reference to the listings, and provided more guidance 
throughout the final rules, including in Sec. 416.926a. We clarified 
and expanded the definitions of ``marked'' and ``extreme'' limitations.

[[Page 54769]]

In all but one case (health and physical well-being), we provided 
within each domain descriptions of typical functioning of children who 
do not have impairments, broken out by age group. For all six domains, 
we also provided examples of limitations.
    We do not agree with those commenters who thought that adjudicators 
might have improperly denied applications when in doubt about how to 
apply the functional equivalence provision. However, we recognize that 
these comments were made when the interim final rules were published in 
1997, when some people were worried about this possibility. These 
comments were submitted before we began the corrective actions 
described earlier, including the Commissioner's top-to-bottom review 
and extensive adjudicator training to ensure proper application of the 
rules.
    We do not agree that we need to specifically instruct adjudicators 
to apply the functional equivalence provision, as some commenters 
recommended. The regulations provide a sequential evaluation process 
for childhood disability claims in Sec. 416.924, and they discuss the 
determination process at step three in detail in Secs. 416.924a through 
416.926a. We believe that these regulations make clear that if a 
child's impairment(s) is severe and does not meet or medically equal 
the requirements of a listing, the adjudicator must evaluate whether 
the child's impairment or combination of impairments functionally 
equals the listings.
    Comment: Some commenters said the interim final rules did not 
adequately define what constitutes a ``marked'' or an ``extreme'' 
limitation and that this could result in incorrect and inconsistent 
determinations and decisions. In addition, some commenters recommended 
that case illustrations of impairments that interfere seriously with a 
child's functioning, and thus result in a ``marked'' limitation, should 
be included in the regulations.
    A few commenters thought the definition of an ``extreme'' 
limitation was internally inconsistent. These commenters noted that the 
definition of an ``extreme'' limitation for children from birth to the 
attainment of age 3 was one resulting in functioning at less than one-
half chronological age. In contrast, the definition for children from 
age 3 to the attainment of age 18 was ``no meaningful function in a 
given area.'' These commenters pointed out that a child functioning at 
less than one-half of chronological age may be less impaired than one 
with no meaningful function in a given area.
    Response: As noted in the summary of the changes and responses 
above, we clarified and expanded our definitions of the terms 
``marked'' and ``extreme'' in response to these comments. However, we 
did not include examples or case illustrations of impairments that 
result in ``marked'' or ``extreme'' limitations. As we clarify 
throughout these rules, any physical or mental impairment or 
combination of impairments may result in a marked or extreme limitation 
in one or more domains if it causes sufficiently serious functional 
limitations. Also, to properly provide examples of functional 
limitations that satisfy the definitions of the terms would have 
required far too many examples to cover each of the six domains and 
five age categories, as well as physical and mental impairments and 
combinations of impairments.
    We agreed with the commenter who observed that people might 
misunderstand what we intended by ``no meaningful function'' in our 
definition of ``extreme.'' In response, we deleted the phrase. In its 
place, we now explain in the final rules that, although we use 
``extreme'' to rate the worst limitations, it does not necessarily mean 
a total lack or loss of ability to function. Our intention is to 
parallel the definition of a ``marked'' limitation as the equivalent of 
the functioning we would expect to find on standardized testing with 
scores that are at least two, but less than three, standard deviations 
below the mean. Therefore, we define ``extreme'' limitation as the 
equivalent of the functioning we would expect to find on standardized 
testing with scores that are at least three standard deviations below 
the mean.
    Comment: Many commenters referred to the provisions of 
Sec. 416.926a(c)(3) of the interim final rules defining ``marked'' 
limitation to mean a valid score that is two standard deviations or 
more below the norm for the test, but less than three standard 
deviations. Most noted that no test is exact, and that all tests 
include a measure of uncertainty called the ``standard error of 
measurement'' (the SEM), which they urged us to recognize.
    Some commenters believed that we should establish rules to provide 
that a child's impairment(s) meets or equals the requirements of a 
listing when the child's test scores are within one, or even two, SEMs 
for the particular test or protocol. Others referred to specific tests, 
such as the Wechsler Intelligence Scale for Children--Third Edition, 
and noted that a child who had a score of 70 on that test, plus or 
minus two SEMs, should be found to have a marked limitation of 
cognitive functioning. The commenters asserted that many children will 
be unfairly denied benefits unless the rules recognize the concept of 
the SEM.
    Response: In response to these comments, we clarified our rules on 
how we consider test scores in final Secs. 416.924a(a)(1) and 
416.926a(e)(4). However, we did not adopt the comments that asked us to 
refer explicitly to the SEM in our rules. We also did not adopt the 
comments that said we should accept as meeting a test criterion in the 
listings or satisfying the definition of ``marked'' or ``extreme'' any 
test score that was within one or two SEMs above the requirements in 
these final rules and other regulations.
    As noted in our summary of the changes, we agree that all test 
scores are less than perfectly reliable. Professionals use the SEM to 
estimate how reliable any given score may be as a measurement of a 
child's ability in the area being tested. For example, one can 
reasonably conclude that 68 percent of the time a child's score on an 
IQ test with an SEM of 5 will fall within a band of 10 points (plus or 
minus one SEM) of the score that was actually obtained; e.g., 67 to 77 
with a score of 72 and an SEM of 5. Ninety-five percent of the time a 
child's score on an IQ test with an SEM of 5 will fall within a band of 
20 points (plus or minus two SEMs) of the score that was actually 
obtained; e.g., 62 to 82 with a score of 72 and an SEM of 5. This means 
that a child who scores a 75 on an IQ test with an SEM of 5 has a 95 
percent chance of having a ``true'' ability that would be shown by a 
score somewhere between 65 and 85.
    Therefore, it would be incorrect, as many of the commenters 
suggested, to assume that an IQ (or other test score) of 74 or 75 with 
an SEM of 5 ``includes'' an IQ of 70. It would also be wrong both 
scientifically and as a matter of public policy for us to issue a rule 
that requires our adjudicators to apply only the ``minus'' half of the 
``plus or minus'' consideration that the SEM requires.
    The final rules include two important principles we have taught our 
adjudicators over the years. First, no test score can be considered in 
isolation from all of the other information about a child's abilities 
and actual functioning. Second, it is primarily the responsibility of 
the person who administered the test to decide whether it reliably 
measures a child's abilities. The final rules also incorporate specific 
requirements for our adjudicators when they do not believe that a test 
score accurately indicates a child's abilities. We believe that these 
changes address the major concerns of the commenters.

[[Page 54770]]

    Comment: Several commenters expressed concern about how the 
definitions of ``marked'' and ``extreme'' that are based on a 
developmental quotient apply to the evaluation of children from birth 
to attainment of age 3. One letter (from a group of medical 
professionals) pointed out that the standard becomes progressively 
stricter for older children within this age range. For example, the 
letter noted that under the rules a child has an ``extreme'' limitation 
when he or she is functioning at one-half of his or her chronological 
age in a domain. Therefore, a 1-year-old child would meet the standard 
by being 6 months behind, while a 3-year-old would need to be delayed 
18 months. As a result, the 3-year-old would have to demonstrate a more 
serious limitation by functioning at a level appropriate to a child 
1\1/2\ years old.
    The letter suggested that we evaluate children from birth to age 3 
based on three age categories (birth to 12 months, 13 to 24 months, and 
25 to 36 months) and suggested new definitions for our terms to fit the 
three proposed categories. Another commenter recommended that the 
criteria used to define and describe ``marked'' and ``extreme'' should 
be used as guidelines rather than standards, since there is no 
objective way to evaluate accurately whether a child has reached a 
level of functioning that is characteristic of one-half (versus two-
thirds) of his or her chronological age.
    Response: We revised the rules in response to these comments but 
did not adopt the specific suggestions.
    We used a developmental quotient in the interim final rules as an 
approximation for when we do not have standard scores in the case 
record. To make this clear in response to the comments, we revised the 
definitions of ``marked'' and ``extreme'' to indicate that in this age 
range we will base our findings on developmental quotients only when 
there are no standard scores from standardized tests in the case 
record.
    We did not agree with the proposal to divide the birth to age 3 
range into three separate ranges because we believe that at these early 
ages our single rule yields a sufficiently accurate estimate. We also 
expect that the older children in this range will have more 
standardized testing in their case records and that we will not have to 
use the developmental quotient alternative as often as for the very 
youngest children.
    In response to the commenter who thought that the definitions of 
``marked'' and ``extreme'' should not be strict standards, we explain 
throughout the final rules that we must consider all relevant 
information in a child's case record to determine whether the totality 
of the information indicates that a child has a ``marked'' or an 
``extreme'' limitation. That is why we provide alternative definitions 
for the terms.
    Comment: A number of commenters urged us to separate the cognitive/
communicative area of functioning into two separate domains. Some noted 
that neurological disorders or brain injuries can affect cognition and 
communication differently, because the two functions involve separate 
areas of the brain and impairments may affect each area differently. 
Some commenters stated that communication warranted a separate domain 
because no other facet of human behavior has such a direct impact on 
daily life: it is the foundation for acquiring many other skills and 
for adapting to other impairments. They asserted that from a clinical 
perspective, a child with mental retardation and a ``moderate to 
severe'' limitation in communication is extremely disabled, and would 
have minimal ability to compensate for functional limitations by using 
assistive technology.
    Response: The new domains respond to these concerns. Communication 
comprises both language and speech, and language serves two purposes: 
it enables us to think and to communicate. Although the ability to 
think and the ability to use language may be affected differently by 
brain injuries and disorders, language ability is inherent in verbal 
reasoning or thinking in normal human functioning. This makes it 
necessary to consider thought and some aspects of language in a single 
domain. The new domain of Acquiring and Using Information recognizes 
that a child uses language to learn (acquire information) and to think 
(use information).
    Language also enables us to communicate with words, and the use of 
both verbal and nonverbal communication skills in social contexts 
(called the pragmatics of language) is an essential aspect of social 
functioning. The new domain of Interacting and Relating With Others 
recognizes that a child uses language to play with friends, to interact 
with peers and adults at school, and to relate to family members and 
other children. This domain also recognizes that, since limitations in 
speech (articulation, voice, and fluency) can interfere with a child's 
oral communication skills at home, at school, or in the community, it 
can affect how the child interacts with and relates to other people.
    Finally, a child with mental retardation may have difficulty in 
using language to learn or to interact and relate with others that is 
not a function of intellectual ability but, rather, is a separate 
impairment that causes an additional, significant limitation of 
functioning. This situation is recognized by, and evaluated under, 
listings 112.05D and F. However, any child who must use assistive 
technology to communicate, even one who does not have mental 
retardation, would likely have an impairment that meets or medically 
equals a listing.
    Comment: Several commenters recommended that we provide areas of 
functioning for children with physical impairments such as respiratory 
and digestive disorders. They thought that the addition of other areas 
of functioning was needed to address associated problems such as lack 
of endurance, frequency of infections, and recovery time after multiple 
procedures. One commenter recommended that we divide the motor area of 
functioning into separate areas for fine and gross motor skills, 
because the field of child development regards them as distinct and 
different.
    Response: We adopted the first comment with the new domain Health 
and Physical Well-Being, which addresses the cumulative physical 
manifestations of physical or mental impairments and the effects of 
their associated treatments or therapies on a child's functioning. We 
did not adopt the second comment because we believe that the domain of 
Moving About and Manipulating Objects is sufficiently described to make 
clear that fine and gross motor skills are different, but also that 
they work together in some aspects of a child's functioning.
    Comment: A number of commenters recommended that we add more 
domains for children from age 1 to the attainment of age 3. Some 
thought that having only three areas of functioning for children in 
this age range meant that the child would have to show a ``pervasive'' 
impairment of functioning, in a manner contrary to the statute. Many 
commenters recommended that we apply the domains of personal 
functioning and concentration, persistence, or pace, to children in 
that age group.
    Response: We adopted these comments by revising the domains. As we 
have already noted, all six new domains apply to children in every age 
group.
    Comment: One commenter thought that restricting the domain in the 
interim final rules we called ``Responsiveness to Stimuli'' to children 
from birth to age 1 ignored the impact of severe sensory deficits on 
the

[[Page 54771]]

functional capability of children older than 1 year.
    Response: We adopted the comment. Sensory functions spread across 
virtually all of the domains for all ages, and sensory deficits or 
hypersensitivities can affect a wide range of a child's activities. In 
the final rules, we incorporated the principle of ``responsiveness to 
stimuli'' in the domain of Attending and Completing Tasks, which is 
applicable to children in all age groups. This domain addresses the 
child's capacity to respond appropriately to all kinds of stimuli, as 
well as its evolution into the capacity to attend appropriately to 
stimuli in all activities and settings. We also recognize more broadly, 
however, that limitations in sensory functioning may also affect a 
child in any of the domains.
    Comment: Several commenters recommended that we add cross-
references in Sec. 416.926a to adequately integrate into the functional 
equivalence determination the need for consideration of a child's age, 
functioning, other factors, and pain and other symptoms. They provided 
specific language for a new subparagraph for Sec. 416.926a that would 
include only cross-references.
    Response: We adopted these comments, but did not introduce a 
separate paragraph of cross-references. Instead, where appropriate, we 
included cross-references throughout final Secs. 416.924a and 416.926a. 
As we noted in the summary of changes, we also made a number of changes 
to give the ``other factors'' provisions greater prominence and to make 
them more comprehensive and easier to understand.
    Comment: One commenter asked us to clarify the provision on the 
``combined effects of limitations due to ongoing treatment'' in 
Sec. 416.926a(b)(4) of the interim final rules. This commenter stated 
that the language in the regulations is not very relevant to children 
who have a serious emotional disturbance, such as a child who is placed 
in a self-contained classroom or in day treatment.
    Response: We believe that the commenter was concerned that a child 
in a structured or supportive setting would not be functioning as well 
outside of this special environment. In final Sec. 416.924a(b)(5), we 
clarified our longstanding rules on how we consider the effects of 
structured or supportive settings on children. We agree that such 
children may be more limited in their functioning than their symptoms 
and signs in the structured setting would indicate. Like the interim 
final rules, the final rules provide that we will also consider the 
child's functioning outside of the structured or supportive setting.
    Comment: A number of commenters expressed concerns about the 12 
examples of functional equivalence in Sec. 416.926a(d) of the interim 
final rules. The primary concern was that adjudicators may rely solely 
on the list and not recognize that other impairments may also 
functionally equal a listing. They suggested that we emphasize and 
reinforce through training and written instructions that the list is 
not exhaustive, that we update the list as more rare syndromes or 
disorders are identified, and that we explain why these particular 
examples functionally equal the listings. One commenter asked us to 
eliminate the age limit for example 12, gastrostomy in a child who has 
not attained age 3.
    Response: We did not adopt the comments. We received the same 
comments in response to the 1991 childhood disability regulations. In 
the 1993 regulations, we added language to emphasize that ``the 
examples do not describe all the possible effects of impairments that 
might establish equivalence to a listed impairment.'' In the preamble 
to the 1993 regulations, we explained why we did not adopt comments 
suggesting that we add rationales to some or all of the examples to 
provide more insight into their intent, and that we state the 
particular listings that are equaled in the various examples (58 FR at 
47564). Those explanations are applicable to the current comments as 
well.
    However, as already noted in our explanation of the final rules, we 
did delete examples 5 and 10 because of other changes we made; i.e., 
the new domains and the delinking of the functional equivalence policy 
from specific listings.

Section 416.987  Disability Redeterminations for Individuals Who Attain 
Age 18

    Comment: One commenter disagreed with the provision that requires 
us to redetermine the eligibility of SSI recipients who attain age 18 
using the adult standard, required in section 1614(a)(3)(H)(iii) of the 
Act. This provision also requires that we do not consider the medical 
improvement review standard that applies in continuing disability 
reviews of adult and children. The commenter questioned the fairness of 
applying the criteria for new applicants, rather than the medical 
improvement review standard, when a child reaches age 18.
    Response: We did not adopt the comment. Section 1614(a)(3)(H)(iii) 
of the Act states that when we perform an age-18 disability 
redetermination under this provision, ``paragraph (4)'' (i.e., section 
1614(a)(4) of the Act) ``shall not apply.'' Section 1614(a)(4) of the 
Act sets out the medical improvement review standard that we use when 
we perform CDRs. In light of the plain language of the statute, we have 
no discretion to apply the medical improvement review standard to age-
18 disability redeterminations.

Section 416.990  When and How Often We Will Conduct a Continuing 
Disability Review

    Comment: One commenter recommended that we provide a cross-
reference in this section to Sec. 416.924a(b) and provide that the 
corrected chronological age be used as the ``trigger date'' for a CDR.
    Response: We did not adopt the comment, but revised this section to 
reflect a change in the law made in 1997 that addresses the commenter's 
concerns. As noted in the supplementary information section of this 
preamble, section 5522(a)(2) of the Balanced Budget Act of 1997, Pub. 
L. 105-33, 111 Stat. 251, 622, amended section 1614(a)(3)(H)(iv) of the 
Act, which required us to conduct a CDR at age 1 for children for whom 
low birth weight is a contributing factor material to the determination 
of disability. This revision allows us to schedule a CDR later than age 
1 for a low birth weight child if, at the time we make the initial 
disability determination, we determine that the child's impairment(s) 
is not expected to improve within 12 months after birth.
    We believe that the statutory change now reflected in final 
Sec. 416.990(b)(11) addresses the commenter's concerns by providing us 
with greater flexibility in scheduling CDRs for these cases.

Section 416.994a  How We Will Determine Whether Your Disability 
Continues or Ends, and Whether You Are and Have Been Receiving 
Treatment That Is Medically Necessary and Available, Disabled Children

    Comment: One commenter had several concerns about Sec. 416.994a(e), 
which describes the limited situations in which disability can be found 
to have ended even though medical improvement has not occurred. The 
commenter believed that each ``exception'' appeared to be our attempt 
to ``circumvent [our] legal burden to show that a recipient's 
impairment has medically improved.'' The commenter asserted that the 
statement in the regulation that there can be a lessening or absence of 
functional limitations without any decrease in the severity of

[[Page 54772]]

the underlying impairment was, ``on its face, absurd.'' The commenter 
thought that if there has been no medically determinable improvement in 
the underlying impairment, by definition, the resulting functional 
limitations cannot have changed. The commenter further stated that the 
second exception, in which the claimant never should have been found 
disabled, was an ``illegal'' reopening and revision of our previous 
final determination or decision.
    Response: The first sentence of Sec. 416.994a(e) explains that 
``[t]he law provides certain limited situations when [a child's] 
disability can be found to have ended even though medical improvement 
has not occurred.'' The provisions in this regulation section are 
required by, and consistent with, section 1614(a)(4)(B) and (C) of the 
Act.
    The commenter's second assertion was unclear. There is no statement 
in Sec. 416.994a(e) or elsewhere in Sec. 416.994a that there can be ``a 
lessening or absence of functional limitations without any decrease in 
the severity of the underlying impairment.''
    The commenter also seems to have misunderstood the intent of the 
provisions in Secs. 416.1487 through 416.1493 of our regulations. Those 
provisions allow us to reopen and revise determinations and decisions 
so that we can change the original determination or decision 
retroactively. The provisions in Sec. 416.994a(e) generally do not 
affect a child's eligibility in prior months the way a reopening would. 
They simply provide a basis in certain rare instances for ceasing 
eligibility when there has not been medical improvement. In such cases, 
we find that disability ends in the month specified by the provisions 
of Sec. 416.994a(g), usually not earlier than the month in which we 
mail the child and his or her family a notice saying that the 
information we have shows that the child is not disabled.
    Comment: One commenter expressed concern that the medical 
improvement rules seem to ``reward'' children who receive higher levels 
of service. The commenter pointed out that children who are severely 
emotionally disturbed are at particular risk of having their benefits 
ceased because, given the short-term nature of mental health services, 
problems may improve and services may be terminated before the problem 
is addressed.
    Response: As we have long indicated in Sec. 416.994a(c)(3), we do 
consider the fact that some impairments are subject to temporary 
remissions, which can give the appearance of medical improvement when 
in fact there has been none. This section further explains that, with 
these kinds of impairments, we will consider the longitudinal history 
of the impairment, including the occurrence of prior remissions or the 
prospect for a future worsening of the impairment when we decide 
whether there has been medical improvement. Even if there has been 
medical improvement, however, this does not necessarily mean that a 
child's benefits will cease. We must still determine whether the child 
is currently disabled despite medical improvement.
    Comment: One commenter asked us to include psychiatric management 
with medical management in Sec. 416.994a(i)(2)(i) instead of grouping 
it with psychological and psychosocial counseling in 
Sec. 416.994a(i)(2)(ii). The commenter noted that psychiatric patient 
management includes medication management as well as other medical 
evaluation and management services.
    Response: We adopted the comment by deleting the word 
``psychiatric'' from Sec. 416.994a(i)(1)(ii).
    Comment: Several commenters expressed concern about how we would 
interpret the requirement to show ``treatment that is medically 
necessary and available.'' They recommended that we provide examples 
and guidance to ensure that the provision is applied consistently. One 
commenter noted that the concept of ``medical necessity'' is very 
controversial within Medicaid managed care programs for children with 
special health care needs. The commenter recommended that we change the 
wording in Sec. 416.994a(i)(1) from ``improve and [sic] restore'' to 
``maintain or restore'' and provide examples of treatment that would be 
considered medically necessary under this provision.
    Response: These comments were submitted before we implemented the 
treatment requirement of the law. Since that time, we have issued very 
detailed operating instructions that address the concerns the 
commenters raised.
    The comment regarding ``medical maintenance'' raises a point that 
is more germane to access to medical care than to the purpose of the 
treatment provision. We did not adopt the suggested wording change 
because we believe that the original wording better reflects the intent 
of the law. We also did not adopt the suggestion that we add examples 
of treatment that we consider medically necessary because the 
appropriate and available level and type of treatment will vary for 
each child.
    Comment: One commenter asked if school-based behavioral or mental 
health interventions are considered evidence that a representative 
payee must present to show the child is and has been receiving 
treatment considered medically necessary and available. If so, the 
commenter recommended that we clarify this section to include school-
based interventions.
    Response: Although we may consider school-based treatment to be 
treatment that is ``medically necessary and available,'' we did not 
adopt the comment. Children may receive medical management, 
psychological or psychosocial counseling, and various kinds of therapy 
in a school setting. To that extent, we would consider that a payee has 
satisfied the requirement for showing that the child is receiving the 
appropriate treatment under the examples we provided in the interim 
final rules, as modified by these final rules. However, we do not want 
to give the impression that everything a child may do in school can be 
a requirement under this section, which we believe would be too much of 
a burden on families and would go beyond the intent of the statute. 
Therefore, we chose not to single out therapy received in a school 
setting in the final rules.

Other Comments

    Comment: Several commenters expressed disagreement with the statute 
itself. One believed the law appeared to be an attempt to ``get 
around'' the Supreme Court's 1990 decision in Zebley and wondered how 
the Court would rule on this new law.
    Response: The issue the Supreme Court addressed in Zebley was 
whether we had correctly interpreted the prior statutory standard of 
``comparable severity.'' Nothing in the Zebley decision, however, 
precluded Congress from revising the definition of disability for 
children.
    A Supreme Court decision construing a statute does not freeze the 
law and preclude Congress from later amending the statute, as the 
commenter seemed to assume. Indeed, the Supreme Court has recognized 
that ``Congress frequently `responds' to judicial decisions construing 
statutes, and does so for a variety of reasons,'' and noted that 
according to one commentator, between 1967 and 1990, Congress 
``overrode'' Supreme Court decisions at an average of 10 per Congress. 
Rivers v. Roadway Express, Inc., 511 U.S. 298, 305 n.5 (1994) (citing 
Eskridge, Overriding Supreme Court Statutory Interpretation Decisions, 
101 Yale L. J. 331, 338 (1991)).
    Comment: One commenter noted that the rules appeared too cumbersome 
and complex, used too many legal words, and needed to be simplified and 
structured to be more user-friendly.

[[Page 54773]]

Another thought that the complex language and the structure of the 
regulations were inconsistent with the ``plain language'' goal and 
simplification efforts of the Agency. This commenter also believed the 
rules in general lacked basic clarity, and that we needed to eliminate 
the ``unnecessary'' differences in wording between the mental 
impairment listings for children and for adults.
    Response: We adopted most of these comments. We revised several of 
the interim final rules to make them clearer and to use ``plain 
language'' as much as possible. These changes are not substantive 
changes from the interim final rules, only clarifications. Also, as 
explained earlier in this preamble, we simplified and restructured 
prior Secs. 416.924a through 416.924c into final Secs. 416.924a and 
416.924b and simplified the rules on functional equivalence.
    We did not adopt the comment that asked us to revise both the adult 
and childhood mental disorders listings to eliminate ``unnecessary'' 
differences. The only changes we made to the childhood mental disorders 
listings in the prior rules were to reflect changes mandated by Pub. L. 
104-193. We do not have authority under the Administrative Procedure 
Act to make the type of extensive changes suggested by the commenters 
to these other rules without first proposing such changes to the public 
in a notice of proposed rulemaking.
    Comment: A number of commenters suggested ways that we could 
provide information to families, advocacy groups, medical and other 
professionals, and State agency personnel who work on behalf of 
children with disabilities. The commenters made a number of suggestions 
for how we could do this.
    Response: Although the comments did not address the prior rules, we 
thought that some of the ideas were very good, and have kept them in 
mind as we provided public information over the years since we 
published the prior rules. We will also consider some of the specific 
ideas for future use.
    Comment: One commenter asked if we had consulted with members of 
the Federal Interagency Coordinating Council (FICC), which coordinates 
policy for young children with disabilities, to benefit from their 
expertise as we developed the rules.
    Response: We are a member of and active participant in the FICC. 
The FICC is established under 20 U.S.C. 1444 (as amended by Pub. L. 
105-17, the Individuals with Disabilities Education Act Amendments of 
1997, 111 Stat. 37, 121). Among other things, the FICC ensures the 
effective coordination of Federal early intervention and preschool 
programs and policies across Federal agencies.
    We agree that the FICC has a wealth of expertise on disability 
issues for young children. We believe our involvement with the FICC has 
provided us with further insight into childhood disability issues and 
has positively influenced our decision to make some of the changes in 
these final rules.
    Comment: Several commenters expressed regret that we developed the 
regulations quickly and without consulting with child-serving 
professionals, especially regarding the development of age categories 
and the selection of tests to evaluate functional limitations. One 
commenter offered to participate. Another commenter said a more 
deliberative process that used the workgroup concept that we had 
employed in the past would have been a better mechanism for developing 
rules that will have such a significant effect on the lives of poor 
children.
    Response: Most of the changes to the childhood disability program 
made by Pub. L. 104-193 were made effective on enactment, or within a 
short time after enactment, without regard to whether regulations had 
been issued to implement the provisions. In addition, section 215 of 
Pub. L. 104-193, 110 Stat. 2105, 2196, required us to issue regulations 
within 3 months after the date of enactment of the law. Since many 
provisions were effective without regard to whether we had issued 
regulations, and since Congress required timely implementation of the 
changes to the childhood program, we had to act quickly.
    As we explained earlier in this preamble, however, we also took a 
number of actions, such as the ``top-to-bottom'' review, to ensure that 
we implemented the changes to the childhood disability program fairly, 
in a manner consistent with the law. In addition, as noted in the 
supplementary information section, we asked a number of individual 
experts for information as we formulated these final rules. We believe 
that our actions have addressed the commenters' concerns.
    Comment: Several commenters said that we must adequately train 
physicians and psychologists who perform consultative examinations to 
assess and document all of a child's areas of functioning and 
development and to determine any impairment-related restrictions. 
Several other commenters thought we should help the medical community 
and psychologists by providing them with written training materials and 
seminars explaining the term ``functional equivalence'' to help them in 
responding to requests for information.
    Response: Physicians, psychologists, and other health care 
professionals who perform consultative examinations are required to 
conduct testing in accordance with standard medical practice, including 
testing and evaluation of abilities or functioning in childhood cases 
where appropriate. Professional relations officers employed by the 
State agencies train consultative examiners where possible.
    We also provide information to the medical community and to 
psychologists by distributing literature and training materials and 
exhibiting at numerous medical conventions each year. Our medical and 
psychological consultants are often available at these conventions to 
answer specific questions from other doctors or other attendees.
    We also sponsor and present continuing medical education seminars 
at select medical conventions. These activities are all directed 
towards educating physicians, psychologists, and other professionals so 
that they can provide us with the evidence we need to make a decision 
on a claim.
    Publications for health professionals are listed in the ``Social 
Security Disability Public Information Products List.'' (SSA 
Publication No. 64-065). This list can be ordered by calling 410-965-
0945, sending a request by fax to 410-965-0696, or sending a written 
request to: Public Information Distribution Center, P.O. Box 17743, 
Baltimore, Maryland 21235-7743.
    Finally, we plan to produce a new training package on SSI childhood 
disability for medical professionals in 2001.
    Comment: Several commenters recommended that we provide uniform 
guidance and training at all levels of the administrative review 
process to emphasize the importance of using all relevant evidence in 
making eligibility determinations, and to ensure a consistent 
developmental and adjudicative outcome to the extent possible.
    Response: We agreed with these comments. Administrative law judges 
and the Appeals Council use the regulations and SSRs when they make 
decisions, but State agencies, quality reviewers, and other 
adjudicators use the Program Operations Manual System, or POMS, which 
are based on and consistent with the regulations and rulings. To ensure 
that everyone used the same, exact instructions, we printed the text of 
the interim final rules

[[Page 54774]]

verbatim in the POMS and will do the same with these final rules.
    Likewise, we provided the same training to all our adjudicators 
when we first implemented the rules in 1997 and in training classes we 
conducted in 1998 in response to our findings in the top-to-bottom 
review. As noted earlier in this preamble, we issued manuals for two of 
these training classes. The training manuals went to all adjudicators 
at all levels of the process. We also issued SSR 98-1p in 1998 to 
address the evaluation of speech and cognition, and it is printed 
verbatim in the POMS.
    Under our Process Unification initiative, these actions are not 
unusual or confined to childhood disability issues. For several years, 
we have published all of our new regulations and SSRs for adults and 
children verbatim in the POMS, and whenever appropriate provided 
uniform national training to all adjudicators.
    Comment: Some commenters thought that the 1-year period for 
redetermining the eligibility of children who might lose eligibility 
because of the changes in Pub. L. 104-193 was too short. They stated 
that because the regulations would be difficult and time-consuming to 
apply, case processing time, quality, and staff commitment would be 
adversely affected. They were concerned that the State agencies and 
administrative law judges would be pressured to make up time lost 
during the regulatory process and be blamed for falling behind in case 
dispositions, resulting in hasty decisions. One commenter was concerned 
that the deadline would not give recipients adequate time to get 
information needed to show that a child meets the eligibility criteria 
or time to adjust to a loss of benefits resulting in reduced family 
income.
    Response: As we noted at the beginning of this preamble, the 
requirement to perform the redeterminations within 1 year of enactment 
was a provision in Pub. L. 104-193. However, subsequent amendments to 
the law have largely addressed this concern. Section 5101 of Pub. L. 
105-33, 111 Stat. 251, 595, extended the period from 1 year to 18 
months after enactment of Pub. L. 104-193, and also provided that any 
redetermination not performed within that time could be performed as 
soon as practicable thereafter. Therefore, we had more time to do the 
redeterminations than the commenters assumed.
    We also explained earlier in this preamble that we considered in 
the top-to-bottom review of the childhood disability program the 
concerns that the State agencies might have rushed redeterminations to 
meet the original August 22, 1997, deadline. We found that these 
concerns were largely unfounded, but we realize that the comments were 
sent in just after we published the interim final rules and before we 
had completed a significant number of redeterminations. However, we did 
take actions, already described, to address issues about the accuracy 
of some determinations. We have also explained in earlier responses the 
efforts we make to help families get evidence.
    Comment: Several commenters were concerned about families' ability 
to appeal a redetermination that resulted in a finding of ineligibility 
and still retain Medicaid, because of the short time in which parents 
had to appeal adverse determinations. The commenters suggested that we 
and the Health Care Financing Administration (HCFA) give clear 
guidelines to families about when they would have to repay cash and 
Medicaid benefits received during the appeal period if their appeal was 
denied. Several commenters recommended that Medicaid coverage should be 
guaranteed for those children with mental, emotional, and behavioral 
problems who lose their eligibility.
    Response: This issue also has been resolved by subsequent 
legislation and actions we took based on our top-to-bottom review. 
Section 4913 of Pub. L. 105-33, 111 Stat. 251, 573, added a provision 
to continue Medicaid for children who lost eligibility for SSI as a 
result of a redetermination under Pub. L. 104-193. In addition, we have 
worked closely with HCFA, the agency that administers Medicaid and is 
responsible for implementing this change in the law. We have 
periodically provided lists to the Medicaid State agencies to ensure 
proper identification of the children who are eligible for continued 
Medicaid coverage under Pub. L. 105-33.
    On April 7, 2000, HCFA also sent a letter to State Medicaid 
directors reminding them of the effects of the changes and requiring 
them to take certain actions. Interested readers may see the letter at 
www.hcfa.gov/medicaid/smd40700.htm.
    We understood the concern that our redetermination notices might 
have been confusing, so in 1998 we sent supplementary notices in 
simpler language to families (or other payees). These new notices 
explained that they had another chance to request a reconsideration and 
also gave families a new 10-day period to request benefit continuation 
during an appeal. We also took several actions, explained at the 
beginning of this preamble, to make sure that families better 
understood their rights to ask for waiver of any overpayment that might 
result from the request.
    Comment: Several commenters recommended that we instruct State 
agencies to postpone completing cases during the summer if school 
records are unavailable.
    Response: We did not adopt the comment. State agencies already have 
the authority to postpone their determination in any case until 
information they need is available. However, when sufficient 
information can be obtained from other sources to make a correct 
determination, it would not be in the best interest of children and 
families to require the State agencies to delay their determinations.
    Comment: One commenter thought we should not apply the new 
regulations to claims that were pending on August 22, 1996, when Pub. 
L. 104-193 was enacted, because children had no control over the timing 
of determinations or decisions on their claims. This commenter 
suggested that we apply the regulations only to claims filed after the 
date of enactment.
    Response: We did not adopt the comment. Section 211(d)(1)(A) of 
Pub. L. 104-193, 110 Stat. 2105, 2190, provided that the changes to the 
childhood disability standard applied to any individual ``who applies 
for, or whose claim is finally adjudicated * * * on or after the date 
of the enactment of this Act.'' The statute also provided that no 
individual's claim may be considered to be finally adjudicated before 
the date of enactment if, on or after August 22, 1996, there is a 
request pending for administrative or judicial review of a claim that 
has been denied in whole.
    Comment: Several commenters suggested that we provide information 
to policymakers about the impact of the new childhood disability 
regulations by presenting program data and implementing a comprehensive 
research plan. They recommended that we track what happens to a sample 
of children who lose benefits as a result of the new rules. Other 
commenters wanted us to report annually to Congress and the public on 
the number of children who lost eligibility and Medicaid coverage as a 
result of the redetermination of their eligibility. Others urged us to 
make use of techniques and sources of information already used by the 
Department of Health and Human Services and some States in similar 
research programs.
    Response: We maintain detailed program data on all cases affected 
by the revisions to the childhood disability

[[Page 54775]]

regulations. If program data indicate experience that is unexpected, we 
undertake case reviews to ensure that our policies are being applied 
correctly. Periodically, we compile program data into a comprehensive 
report and share it with interested parties, such as Congressional 
staff, advocates, and researchers. In addition, we report overall 
program experience to the Congress in the Annual Report of the 
Supplemental Security Income Program. This report contains information 
on the number of applications filed, the rate of allowances, 
expenditures, and appellate experience for SSI children and adults.
    To assess the effect of the legislative change in the definition of 
disability for children, we contracted with the RAND Corporation for a 
three-phase evaluation. The first phase was an analysis of 
administrative data to assess the characteristics of the children 
affected by the legislation. The second phase included field visits 
with SSA employees, State Medicaid workers, advocates, claimant 
representatives, and educators to assess implementation of the 
legislation. The final phase of the evaluation involves the 
longitudinal tracking of individual families to assess how the loss of 
the child's SSI eligibility affects the overall family and child. As 
noted above, Congress enacted legislation in 1997 to ensure that 
children whose eligibility for SSI was ceased based on a 
redetermination under Pub. L. 104-193 did not lose Medicaid 
eligibility.
    Comment: One commenter addressed the special SSI status permitted 
for adults who begin or return to work despite their disability. The 
commenter referred to ``Sec. 416.20'' of our regulations and 
recommended that we include a comparable exception for children who may 
have difficulty returning to school or advancing to a more progressive 
class/program due to their disabling impairments.
    Response: There is no Sec. 416.20 in our regulations, but we 
believe the commenter may have been referring to Sec. 416.260. That 
regulation, and several that follow it, explain how we implement 
sections 1619(a) and 1619(b) of the Act. These sections provide for a 
special SSI cash benefit for people who still have disabling 
impairments but who are working and engage in substantial gainful 
activity, and for continuing Medicaid eligibility for disabled 
individuals whose earnings are too high to receive SSI payments.
    The commenter did not explain how she thought the provisions should 
be applied to children who may have difficulty returning to school or 
advancing in school. When such children have disabling impairments, 
they qualify for SSI as long as they meet the other eligibility 
requirements, including the limitations on income and resources. 
Without a change in the Act, we do not have the authority to disregard 
the income requirements as recommended by the commenter.

Regulatory Procedures

    Pursuant to section 702(a)(5) of the Act, 42 U.S.C. 902(a)(5), the 
Social Security Administration follows the Administrative Procedure Act 
(APA) rulemaking procedures specified in 5 U.S.C. 553 in the 
development of its regulations. The APA provides exceptions to its 
Notice of Proposed Rulemaking (NPRM) procedures when an agency finds 
that there is good cause for dispensing with such procedures on the 
basis that they are impracticable, unnecessary, or contrary to the 
public interest. For the reasons that follow, we have determined that 
under 5 U.S.C. 553(b)(B), good cause exists for waiving the NPRM 
procedures with respect to the changes we are making to 
Secs. 416.987(c) and 416.990(b)(11) to reflect the provisions of 
sections 5522(a)(1) and 5522(a)(2)(B) of Pub. L. 105-33, the Balanced 
Budget Act of 1997.
    Section 5522(a)(1) of Pub. L. 105-33 amended section 
1614(a)(3)(H)(iii) of the Act to provide that we will do a 
redetermination of the disability eligibility of children who attain 
age 18 ``either during the 1-year period beginning on the individual's 
18th birthday or, in lieu of a continuing disability review, whenever 
the Commissioner determines that an individual's case is subject to a 
redetermination under this clause.'' Section 5522(a)(2)(B) amended 
section 1614(a)(3)(H)(iv)(VI) of the Act to provide that we do not have 
to do a CDR by age 1 for a child for whom low birth weight is a 
contributing factor material to our determination of disability if we 
determine at the time of our initial disability determination that the 
child's impairment(s) is not expected to improve by age 1 and we 
schedule a CDR later than age 1.
    Because the language of the statutory provisions added by these 
amendments does not provide for any discretionary policy, we have 
determined that the use of notice-and-comment rulemaking procedures for 
the issuance of rules to reflect these statutory provisions is 
unnecessary. On this basis, we find that good cause exists for 
dispensing with such procedures. Accordingly, we find that prior notice 
and comment are unnecessary with respect to these specific changes made 
to the rules.

Executive Order 12866

    We have consulted with the Office of Management and Budget (OMB) 
and determined that these final regulations meet the criteria for a 
significant regulatory action under Executive Order (E.O.) 12866. 
Therefore, we prepared and submitted to OMB the following assessment of 
the potential costs and benefits of this regulatory action. We have 
also determined that these rules meet the plain language requirement of 
E.O. 12866 and the President's memorandum of June 1, 1998 (63 FR 
31885).
    The potential costs and benefits for the policies reflected in 
these final rules follow:
Program Costs
    It is estimated that due to these final rules there would be 
increased program outlays resulting in the following costs (in millions 
of dollars) to the SSI program ($215 million Total in a 5-year period):

----------------------------------------------------------------------------------------------------------------
      FY2001             FY2002             FY2003             FY2004             FY2005             Total
----------------------------------------------------------------------------------------------------------------
             $5                $25                $45                $60                $75               $215
----------------------------------------------------------------------------------------------------------------

    The following is the estimated Total program outlay (in millions of 
dollars) for SSI childhood disability benefits (which includes the 
increases shown above):

----------------------------------------------------------------------------------------------------------------
      FY2001             FY2002             FY2003             FY2004             FY2005             Total
----------------------------------------------------------------------------------------------------------------
          $5123              $5478              $5807              $6090              $6841             $29339
----------------------------------------------------------------------------------------------------------------


[[Page 54776]]

    Note: Annual numbers may not add to Total due to rounding.
    It is also estimated that there will be an increase in Medicaid 
program outlays.
    The estimated increased Federal Medicaid costs are:

----------------------------------------------------------------------------------------------------------------
      FY2001             FY2002             FY2003             FY2004             FY2005             Total
----------------------------------------------------------------------------------------------------------------
             $2                 $8                $15                $22                $29                $76
----------------------------------------------------------------------------------------------------------------

    There will also be increased Medicaid program outlays for States.
Administrative Costs and Savings
    The administrative costs associated with the final rules are 
attributable to the cost of implementation training and the cost of 
post-eligibility actions for an increased number of childhood 
recipients. Training costs are all in FY 2001 and Total $1,628,000.
    Ongoing Federal administrative costs are workyear costs based on 
increased workloads as a result of the additional children who will be 
allowed under these final rules. There will be additional income and 
resource redeterminations, representative payee actions, and 
maintenance of the rolls activities.
    Estimated administrative costs ($ in millions):

----------------------------------------------------------------------------------------------------------------
      FY2001             FY2002             FY2003             FY2004             FY2005             Total
----------------------------------------------------------------------------------------------------------------
           $1.8                $.7               $1.1               $1.5               $1.9               $6.9
----------------------------------------------------------------------------------------------------------------

    Note: Annual numbers may not add to Total due to rounding.
    Increase in SSI Recipients
    The following figures show the estimated annual increase (in 
thousands) from these final rules on the projected numbers of 
recipients of Federal SSI benefits:

----------------------------------------------------------------------------------------------------------------
      FY2001             FY2002             FY2003             FY2004             FY2005             Total
----------------------------------------------------------------------------------------------------------------
              1                  5                  8                 11                 14                 39
----------------------------------------------------------------------------------------------------------------

    With the increase in SSI recipients shown above, we estimate that 
the average number of disabled children (in thousands) in payment 
status after implementation of these final rules will be:

----------------------------------------------------------------------------------------------------------------
        FY2001                 FY2002                 FY2003                 FY2004                FY2005
----------------------------------------------------------------------------------------------------------------
              832                    864                    888                    906                    922
----------------------------------------------------------------------------------------------------------------

Unfunded Mandates Reform Act of 1995

    These final rules do not impose any Federal mandates that may 
result in the expenditure by State, local, and tribal governments, in 
the aggregate, or by the private sector, of $100,000,000 or more 
(adjusted annually for inflation) in any one year. Therefore, the 
statement described in section 202 of Pub. L. 104-4, the Unfunded 
Mandates Reform Act of 1995 (2 U.S.C. 1532), is not required.

Regulatory Flexibility Act

    We certify that these regulations will not have a significant 
economic impact on a substantial number of small entities because they 
affect only individuals. Therefore, a regulatory flexibility analysis 
as provided in the Regulatory Flexibility Act, as amended, is not 
required.

Paperwork Reduction Act

    These final regulations impose no new reporting or recordkeeping 
requirements necessitating clearance by the Office of Management and 
Budget.

(Catalog of Federal Domestic Assistance: Program Nos. 96.001 Social 
Security-Disability Insurance; 96.006 Supplemental Security Income)

List of Subjects

20 CFR Part 404

    Administrative practice and procedure, Blind, Disability benefits, 
Old-Age, Survivors, and Disability Insurance, Reporting and 
recordkeeping requirements, Social Security.

20 CFR Part 416

    Administrative practice and procedure, Aged, Blind, Disability 
benefits, Public assistance programs, Reporting and recordkeeping 
requirements, Supplemental Security Income (SSI).

    Dated: June 27, 2000.
Kenneth S. Apfel,
Commissioner of Social Security.


    For the reasons set out in the preamble, interim final rules 
amending 20 CFR chapter III which were published at 62 FR 6408 and 
corrected at 62 FR 13537 and 62 FR 13733 are adopted as final rules 
with the following changes:

PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE 
(1950-    )

Subpart P--[Amended]

    1. The authority citation for subpart P of part 404 continues to 
read as follows:

    Authority: Secs. 202, 205(a), (b), and (d)-(h), 216(i), 221(a) 
and (i), 222(c), 223, 225, and 702(a)(5) of the Social Security Act 
(42 U.S.C. 402, 405(a), (b), and (d)-(h), 416(i), 421(a) and (i), 
422(c), 423, 425, and 902(a)(5)); sec. 211(b), Pub. L. 104-193, 110 
Stat. 2105, 2189.

Appendix 1 to Subpart P--[Amended]

    2. Part B of Appendix 1 (Listing of Impairments) of subpart P to 
part 404 is amended by revising the third sentence of the third 
paragraph of 103.00A, the second sentence of the fifth paragraph of 
103.00A, the fourth sentence of the fifth paragraph of 104.00A, the 
second sentence of the sixth paragraph of 104.00A, the second sentence 
of the ninth paragraph of 112.00A, and the second sentence of the third 
paragraph of 112.00C to read as follows:

[[Page 54777]]

Appendix 1 to Subpart P--Listing of Impairments

* * * * *
Part B
* * * * *
103.00  Respiratory System
A. * * *
* * * * *
     * * * Even if a child does not show that his or her impairment 
meets the criteria of these listings, the child may have an 
impairment(s) that medically or functionally equals the listings.
     * * *
* * * * *
     * * * When a child has a medically determinable impairment that is 
not listed, an impairment that does not meet the requirements of a 
listing, or a combination of impairments no one of which meets the 
requirements of a listing, we will make a determination whether the 
child's impairment(s) medically or functionally equals the listings. * 
* *
* * * * *
104.00  Cardiovascular System
A. Introduction
* * * * *
    * * * Even though a child who does not receive treatment may not be 
able to show an impairment that meets the criteria of these listings, 
the child may have an impairment(s) that medically or functionally 
equals the listings.
    * * * When a child has a medically determinable impairment that is 
not listed, an impairment that does not meet the requirements of a 
listing, or a combination of impairments no one of which meets the 
requirements of a listing, we will make a determination whether the 
child's impairment(s) medically or functionally equals the listings. * 
* *
* * * * *
112.00  Mental Disorders
    A. * * *
* * * * *
    * * * When a child has a medically determinable impairment that is 
not listed, an impairment that does not meet the requirements of a 
listing, or a combination of impairments no one of which meets the 
requirements of a listing, we will make a determination whether the 
child's impairment(s) medically or functionally equals the listings. * 
* *
C. * * *
* * * * *
    * * * If the infant or toddler was born prematurely, however, we 
will follow the rules in Sec. 416.924b(b) to determine whether we 
should use the infant's or toddler's corrected chronological age; i.e., 
the chronological age adjusted by the period of gestational 
prematurity.
* * * * *

PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND 
DISABLED

Subpart I--[Amended]

    3. The authority citation for subpart I of part 416 continues to 
read as follows:

    Authority: Secs. 702(a)(5), 1611, 1614, 1619, 1631(a), (c), and 
(d)(1), and 1633 of the Social Security Act (42 U.S.C. 902(a)(5), 
1382, 1382c, 1382h, 1383(a), (c), and (d)(1), and 1383b); secs. 4(c) 
and 5, 6(c)-(e), 14(a) and 15, Pub. L. 98-460, 98 Stat. 1794, 1801, 
1802, and 1808 (42 U.S.C. 421 note, 423 note, 1382h note).


    4. Section 416.901 is amended by revising paragraph (f)(2) as 
follows:


Sec. 416.901  Scope of subpart.

* * * * *
    (f) * * *
    (2) What we mean by the terms medical equivalence and functional 
equivalence and how we make those findings;
* * * * *

    5. Section 416.902 is amended by adding a new definition, ``The 
listings,'' between the definitions for ``Impairment(s)'' and ``Marked 
and severe functional limitations,'' by revising the definition of 
``Marked and severe functional limitations,'' and by revising the 
definition of ``You or your'' to read as follows:


Sec. 416.902  General definitions and terms for this subpart.

* * * * *
    The listings means the Listing of Impairments in appendix 1 of 
subpart P of part 404 of this chapter. When we refer to an 
impairment(s) that ``meets, medically equals, or functionally equals 
the listings,'' we mean that the impairment(s) meets or medically 
equals the severity of any listing in appendix 1 of subpart P of part 
404 of this chapter, as explained in Secs. 416.925 and 416.926, or that 
functionally equals the severity of the listings, as explained in 
Sec. 416.926a.
    Marked and severe functional limitations, when used as a phrase, 
means the standard of disability in the Social Security Act for 
children claiming SSI benefits based on disability. It is a level of 
severity that meets, medically equals, or functionally equals the 
listings. (See Secs. 416.906, 416.924, and 416.926a.) The words 
``marked'' and ``severe'' are also separate terms used throughout this 
subpart to describe measures of functional limitations; the term 
``marked'' is also used in the listings. (See Secs. 416.924 and 
416.926a.) The meaning of the words ``marked'' and ``severe'' when used 
as part of the phrase marked and severe functional limitations is not 
the same as the meaning of the separate terms ``marked'' and ``severe'' 
used elsewhere in 20 CFR 404 and 416. (See Secs. 416.924(c) and 
416.926a(e).)
* * * * *
    You, your, me, my and I mean, as appropriate, the person who 
applies for benefits, the person for whom an application is filed, or 
the person who is receiving benefits based on disability or blindness.

    6. Section 416.906 is amended by revising the last sentence to read 
as follows:


Sec. 416.906  Basic definition of disability for children.

    * * * We discuss our rules for determining disability in children 
who file new applications in Secs. 416.924 through 416.924b and 
Secs. 416.925 through 416.926a.

    7. Section 416.911(b)(1) is revised to read as follows:


Sec. 416.911  Definition of disabling impairment.

* * * * *
    (b) * * *
    (1) Must meet, medically equal, or functionally equal the listings, 
or
* * * * *
    8. Section 416.913 is amended by revising paragraphs (c)(3), (d), 
and (e) to read as follows:


Sec. 416.913  Medical and other evidence of your impairment(s).

* * * * *
    (c) * * *
    (3) If you are a child, the medical source's opinion about your 
functional limitations compared to children your age who do not have 
impairments in acquiring and using information, attending and 
completing tasks, interacting and relating with others, moving about 
and manipulating objects, caring for yourself, and health and physical 
well-being.
    (d) Other sources. In addition to evidence from the acceptable 
medical sources listed in paragraph (a) of this section, we may also 
use evidence from other sources to show the severity of your 
impairment(s) and how it affects your ability to work or, if you are a

[[Page 54778]]

child, how you typically function compared to children your age who do 
not have impairments. Other sources include, but are not limited to--
    (1) Medical sources not listed in paragraph (a) of this section 
(for example, nurse-practitioners, physicians' assistants, naturopaths, 
chiropractors, audiologists, and therapists);
    (2) Educational personnel (for example, school teachers, 
counselors, early intervention team members, developmental center 
workers, and daycare center workers);
    (3) Public and private social welfare agency personnel; and
    (4) Other non-medical sources (for example, spouses, parents and 
other caregivers, siblings, other relatives, friends, neighbors, and 
clergy).
    (e) Completeness. The evidence in your case record, including the 
medical evidence from acceptable medical sources (containing the 
clinical and laboratory findings) and other medical sources not listed 
in paragraph (a) of this section, information you give us about your 
medical condition(s) and how it affects you, and other evidence from 
other sources, must be complete and detailed enough to allow us to make 
a determination or decision about whether you are disabled or blind. It 
must allow us to determine--
    (1) The nature and severity of your impairment(s) for any period in 
question;
    (2) Whether the duration requirement described in Sec. 416.909 is 
met; and
    (3) Your residual functional capacity to do work-related physical 
and mental activities, when the evaluation steps described in 
Sec. 416.920(e) or (f)(1) apply, or, if you are a child, how you 
typically function compared to children your age who do not have 
impairments.
* * * * *

    9. Section 416.919n is amended by revising the third sentence of 
paragraph (c)(6) to read as follows:


Sec. 416.919n  Informing the medical source of examination scheduling, 
report content, and signature requirements.

* * * * *
    (c) * * *
    (6) * * * If you are a child, this statement should describe the 
opinion of the medical source about your functional limitations 
compared to children your age who do not have impairments in acquiring 
and using information, attending and completing tasks, interacting and 
relating with others, moving about and manipulating objects, caring for 
yourself, and health and physical well-being. * * *
* * * * *

    10. Section 416.924 is amended by adding a new fifth sentence to 
paragraph (a), revising the prior tenth (now the eleventh) sentence of 
paragraph (a), revising paragraphs (c) and (d), removing paragraph (f), 
redesignating paragraph (e) as paragraph (f) and revising that 
paragraph, and by adding a new paragraph (e), to read as follows:


Sec. 416.924  How we determine disability for children.

    (a) * * * We will also consider all of the relevant factors in 
Secs. 416.924a and 416.924b whenever we assess your functioning at any 
step of this process. * * * If your impairment(s) is severe, we will 
review your claim further to see if you have an impairment(s) that 
meets, medically equals, or functionally equals the listings. * * *
* * * * *
    (c) You must have a medically determinable impairment(s) that is 
severe. If you do not have a medically determinable impairment, or your 
impairment(s) is a slight abnormality or a combination of slight 
abnormalities that causes no more than minimal functional limitations, 
we will find that you do not have a severe impairment(s) and are, 
therefore, not disabled.
    (d) Your impairment(s) must meet, medically equal, or functionally 
equal the listings. An impairment(s) causes marked and severe 
functional limitations if it meets or medically equals the severity of 
a set of criteria for an impairment in the listings, or if it 
functionally equals the listings.
    (1) Therefore, if you have an impairment(s) that meets or medically 
equals the requirements of a listing or that functionally equals the 
listings, and that meets the duration requirement, we will find you 
disabled.
    (2) If your impairment(s) does not meet the duration requirement, 
or does not meet, medically equal, or functionally equal the listings, 
we will find that you are not disabled.
    (e) Other rules. We explain other rules for evaluating impairments 
at all steps of this process in Secs. 416.924a, 416.924b, and 416.929. 
We explain our rules for deciding whether an impairment(s) meets a 
listing in Sec. 416.925. Our rules for how we decide whether an 
impairment(s) medically equals a listing are in Sec. 416.926. Our rules 
for deciding whether an impairment(s) functionally equals the listings 
are in Sec. 416.926a.
    (f) If you attain age 18 after you file your disability application 
but before we make a determination or decision. For the period during 
which you are under age 18, we will use the rules in this section. For 
the period starting with the day you attain age 18, we will use the 
disability rules we use for adults who file new claims, in 
Sec. 416.920.
* * * * *


Secs. 416.924b and 416.924c  [Removed]

    11. Sections 416.924b and 416.924c are removed.


Sec. 416.924a  [Redesignated as Sec. 416.924b]

    12. Section 416.924a is redesignated as Sec. 416.924b and revised 
to read as follows:


Sec. 416.924b  Age as a factor of evaluation in the sequential 
evaluation process for children.

    (a) General. In this section, we explain how we consider age when 
we decide whether you are disabled. Your age may or may not be a factor 
in our determination whether your impairment(s) meets or medically 
equals a listing, depending on the listing we use for comparison. 
However, your age is an important factor when we decide whether your 
impairment(s) is severe (see Sec. 416.924(c)) and whether it 
functionally equals the listings (see Sec. 416.926a). Except in the 
case of certain premature infants, as described in paragraph (b) of 
this section, age means chronological age.
    (1) When we determine whether you have an impairment or combination 
of impairments that is severe, we will compare your functioning to that 
of children your age who do not have impairments.
    (2) When we determine whether your impairment(s) meets a listing, 
we may or may not need to consider your age. The listings describe 
impairments that we consider of such significance that they are 
presumed to cause marked and severe functional limitations.
    (i) If the listing appropriate for evaluating your impairment is 
divided into specific age categories, we will evaluate your impairment 
according to your age when we decide whether your impairment meets that 
listing.
    (ii) If the listing appropriate for evaluating your impairment does 
not include specific age categories, we will decide whether your 
impairment meets the listing without giving consideration to your age.
    (3) When we compare an unlisted impairment or a combination of 
impairments with the listings to determine whether it medically equals 
the severity of a listing, the way we consider your age will depend on 
the listing we use for comparison. We will use the same principles for 
considering your age as in paragraphs (a)(2)(i) and (a)(2)(ii) of this 
section; that is, we will consider your age only if we are

[[Page 54779]]

comparing your impairment(s) to a listing that includes specific age 
categories.
    (4) We will also consider your age and whether it affects your 
ability to be tested. If your impairment(s) is not amenable to formal 
testing because of your age, we will consider all information in your 
case record that helps us decide whether you are disabled. We will 
consider other generally acceptable methods consistent with the 
prevailing state of medical knowledge and clinical practice that will 
help us evaluate the existence and severity of your impairment(s).
    (b) Correcting chronological age of premature infants. We generally 
use chronological age (that is, a child's age based on birth date) when 
we decide whether, or the extent to which, a physical or mental 
impairment or combination of impairments causes functional limitations. 
However, if you were born prematurely, we may consider you to be 
younger than your chronological age. When we evaluate the development 
or linear growth of a child born prematurely, we may use a 
``corrected'' chronological age; that is, the chronological age 
adjusted by a period of gestational prematurity. We consider an infant 
born at less than 37 weeks' gestation to be born prematurely.
    (1) We apply a corrected chronological age in these situations--
    (i) When we evaluate developmental delay in premature children 
until the child's prematurity is no longer a relevant factor; generally 
no later than about chronological age 2 (see paragraph (b)(2) of this 
section);
    (ii) When we evaluate an impairment of linear growth, such as under 
the listings in Sec. 100.00 in appendix 1 of subpart P of part 404 of 
this chapter, until the child is 12 months old. In this situation, we 
refer to neonatal growth charts which have been developed to evaluate 
growth in premature infants (see paragraph (b)(2) of this section).
    (2) We compute a corrected chronological age as follows--
    (i) If you have not attained age 1, we will correct your 
chronological age. We compute the corrected chronological age by 
subtracting the number of weeks of prematurity (i.e., the difference 
between 40 weeks of full-term gestation and the number of actual weeks 
of gestation) from your chronological age. The result is your corrected 
chronological age.
    (ii) If you are over age 1, have a developmental delay, and 
prematurity is still a relevant factor in your case (generally, no 
later than about chronological age 2), we will decide whether to 
correct your chronological age. Our decision will be based on our 
judgment and all the facts of your case. If we decide to correct your 
chronological age, we may correct it by subtracting the full number of 
weeks of prematurity or a lesser number of weeks. We will also decide 
not to correct your chronological age if we can determine from the 
evidence that your developmental delay is the result of your medically 
determinable impairment(s) and is not attributable to your prematurity.
    (3) Notwithstanding the provisions in paragraph (b)(1) of this 
section, we will not compute a corrected chronological age if the 
medical evidence shows that your treating source or other medical 
source has already taken your prematurity into consideration in his or 
her assessment of your development. Also, we will not compute a 
corrected chronological age when we find you disabled using the 
examples of functional equivalence based on low birth weight in 
Sec. 416.924a(m)(7) or (8).

    13. A new Sec. 416.924a is added to read as follows:


Sec. 416.924a  Considerations in determining disability for children.

    (a) Basic considerations. We consider all relevant information 
(i.e., evidence) in your case record. The evidence in your case record 
may include information from medical sources, such as your 
pediatrician, other physician, psychologist, or qualified speech-
language pathologist; other medical sources not listed in 
Sec. 416.913(a), such as physical, occupational, and rehabilitation 
therapists; and nonmedical sources, such as your parents, teachers, and 
other people who know you.
    (1) Medical evidence. (i) General. Medical evidence of your 
impairment(s) must describe symptoms, signs, and laboratory findings. 
The medical evidence may include, but is not limited to, formal testing 
that provides information about your development or functioning in 
terms of standard deviations, percentiles, percentages of delay, or age 
or grade equivalents. It may also include opinions from medical sources 
about the nature and severity of your impairments. (See Sec. 416.927.)
    (ii) Test scores. We consider all of the relevant information in 
your case record and will not consider any single piece of evidence in 
isolation. Therefore, we will not rely on test scores alone when we 
decide whether you are disabled. (See Sec. 416.926a(e) for more 
information about how we consider test scores.)
    (iii) Medical sources. Medical sources will report their findings 
and observations on clinical examination and the results of any formal 
testing. A medical source's report should note and resolve any material 
inconsistencies between formal test results, other medical findings, 
and your usual functioning. Whenever possible and appropriate, the 
interpretation of findings by the medical source should reflect 
consideration of information from your parents or other people who know 
you, including your teachers and therapists. When a medical source has 
accepted and relied on such information to reach a diagnosis, we may 
consider this information to be a clinical sign, as defined in 
Sec. 416.928(b).
    (2) Information from other people. Every child is unique, so the 
effects of your impairment(s) on your functioning may be very different 
from the effects the same impairment(s) might have on another child. 
Therefore, whenever possible and appropriate, we will try to get 
information from people who can tell us about the effects of your 
impairment(s) on your activities and how you function on a day-to-day 
basis. These other people may include, but are not limited to:
    (i) Your parents and other caregivers. Your parents and other 
caregivers can be important sources of information because they usually 
see you every day. In addition to your parents, other caregivers may 
include a childcare provider who takes care of you while your parent(s) 
works or an adult who looks after you in a before-or after-school 
program.
    (ii) Early intervention and preschool programs. If you have been 
identified for early intervention services (in your home or elsewhere) 
because of your impairment(s), or if you attend a preschool program 
(e.g., Headstart or a public school kindergarten for children with 
special needs), these programs are also important sources of 
information about your functioning. We will ask for reports from the 
agency and individuals who provide you with services or from your 
teachers about how you typically function compared to other children 
your age who do not have impairments.
    (iii) School. If you go to school, we will ask for information from 
your teachers and other school personnel about how you are functioning 
there on a day-to-day basis compared to other children your age who do 
not have impairments. We will ask for any reports that the school may 
have that show the results of formal testing or that describe any 
special education instruction or services, including home-based 
instruction, or any accommodations provided in a regular classroom.

[[Page 54780]]

    (b) Factors we consider when we evaluate the effects of your 
impairment(s) on your functioning.
    (1) General. We must consider your functioning when we decide 
whether your impairment(s) is ``severe'' and when we decide whether 
your impairment(s) functionally equals the listings. We will also 
consider your functioning when we decide whether your impairment(s) 
meets or medically equals a listing if the listing we are considering 
includes functioning among its criteria.
    (2) Factors we consider when we evaluate your functioning. Your 
limitations in functioning must result from your medically determinable 
impairment(s). The information we get from your medical and nonmedical 
sources can help us understand how your impairment(s) affects your 
functioning. We will also consider any factors that are relevant to how 
you function when we evaluate your impairment or combination of 
impairments. For example, your symptoms (such as pain, fatigue, 
decreased energy, or anxiety) may limit your functioning. (See 
Sec. 416.929.) We explain some other factors we may consider when we 
evaluate your functioning in paragraphs (b)(3)-(b)(9) of this section.
    (3) How your functioning compares to the functioning of children 
your age who do not have impairments. (i) General. When we evaluate 
your functioning, we will look at whether you do the things that other 
children your age typically do or whether you have limitations and 
restrictions because of your medically determinable impairment(s). We 
will also look at how well you do the activities and how much help you 
need from your family, teachers, or others. Information about what you 
can and cannot do, and how you function on a day-to-day basis at home, 
school, and in the community, allows us to compare your activities to 
the activities of children your age who do not have impairments.
    (ii) How we will consider reports of your functioning. When we 
consider the evidence in your case record about the quality of your 
activities, we will consider the standards used by the person who gave 
us the information. We will also consider the characteristics of the 
group to whom you are being compared. For example, if the way you do 
your classwork is compared to other children in a special education 
class, we will consider that you are being compared to children who do 
have impairments.
    (4) Combined effects of multiple impairments. If you have more than 
one impairment, we will sometimes be able to decide that you have a 
``severe'' impairment or an impairment that meets, medically equals, or 
functionally equals the listings by looking at each of your impairments 
separately. When we cannot, we will look comprehensively at the 
combined effects of your impairments on your day-to-day functioning 
instead of considering the limitations resulting from each impairment 
separately. (See Secs. 416.923 and 416.926a(c) for more information 
about how we will consider the interactive and cumulative effects of 
your impairments on your functioning.)
    (5) How well you can initiate, sustain, and complete your 
activities, including the amount of help or adaptations you need, and 
the effects of structured or supportive settings. (i) Initiating, 
sustaining, and completing activities. We will consider how effectively 
you function by examining how independently you are able to initiate, 
sustain, and complete your activities despite your impairment(s), 
compared to other children your age who do not have impairments. We 
will consider:
    (A) The range of activities you do;
    (B) Your ability to do them independently, including any prompting 
you may need to begin, carry through, and complete your activities;
    (C) The pace at which you do your activities;
    (D) How much effort you need to make to do your activities; and
    (E) How long you are able to sustain your activities.
    (ii) Extra help. We will consider how independently you are able to 
function compared to other children your age who do not have 
impairments. We will consider whether you need help from other people, 
or whether you need special equipment, devices, or medications to 
perform your day-to-day activities. For example, we may consider how 
much supervision you need to keep from hurting yourself, how much help 
you need every day to get dressed or, if you are an infant, how long it 
takes for your parents or other caregivers to feed you. We recognize 
that children are often able to do things and complete tasks when given 
help, but may not be able to do these same things by themselves. 
Therefore, we will consider how much extra help you need, what special 
equipment or devices you use, and the medications you take that enable 
you to participate in activities like other children your age who do 
not have impairments.
    (iii) Adaptations. We will consider the nature and extent of any 
adaptations that you use to enable you to function. Such adaptations 
may include assistive devices or appliances. Some adaptations may 
enable you to function normally or almost normally (e.g., eyeglasses). 
Others may increase your functioning, even though you may still have 
functional limitations (e.g., ankle-foot orthoses, hand or foot 
splints, and specially adapted or custom-made tools, utensils, or 
devices for self-care activities such as bathing, feeding, toileting, 
and dressing). When we evaluate your functioning with an adaptation, we 
will consider the degree to which the adaptation enables you to 
function compared to other children your age who do not have 
impairments, your ability to use the adaptation effectively on a 
sustained basis, and any functional limitations that nevertheless 
persist.
    (iv) Structured or supportive settings. (A) If you have a serious 
impairment(s), you may spend some or all of your time in a structured 
or supportive setting, beyond what a child who does not have an 
impairment typically needs.
    (B) A structured or supportive setting may be your own home in 
which family members or other people (e.g., visiting nurses or home 
health workers) make adjustments to accommodate your impairment(s). A 
structured or supportive setting may also be your classroom at school, 
whether it is a regular classroom in which you are accommodated or a 
special classroom. It may also be a residential facility or school 
where you live for a period of time.
    (C) A structured or supportive setting may minimize signs and 
symptoms of your impairment(s) and help to improve your functioning 
while you are in it, but your signs, symptoms, and functional 
limitations may worsen outside this type of setting. Therefore, we will 
consider your need for a structured setting and the degree of 
limitation in functioning you have or would have outside the structured 
setting. Even if you are able to function adequately in the structured 
or supportive setting, we must consider how you function in other 
settings and whether you would continue to function at an adequate 
level without the structured or supportive setting.
    (D) If you have a chronic impairment(s), you may have your 
activities structured in such a way as to minimize stress and reduce 
the symptoms or signs of your impairment(s). You may continue to have 
persistent pain, fatigue, decreased energy, or other symptoms or signs, 
although at a lesser level of severity. We will consider whether you 
are more limited in your functioning than your symptoms and signs would 
indicate.

[[Page 54781]]

    (E) Therefore, if your symptoms or signs are controlled or reduced 
in a structured setting, we will consider how well you are functioning 
in the setting and the nature of the setting in which you are 
functioning (e.g., home or a special class); the amount of help you 
need from your parents, teachers, or others to function as well as you 
do; adjustments you make to structure your environment; and how you 
would function without the structured or supportive setting.
    (6) Unusual settings. Children may function differently in 
unfamiliar or one-to-one settings than they do in their usual settings 
at home, at school, in childcare or in the community. You may appear 
more or less impaired on a single examination (such as a consultative 
examination) than indicated by the information covering a longer 
period. Therefore, we will apply the guidance in paragraph (b)(5) of 
this section when we consider how you function in an unusual or one-to-
one situation. We will look at your performance in a special situation 
and at your typical day-to-day functioning in routine situations. We 
will not draw inferences about your functioning in other situations 
based only on how you function in a one-to-one, new, or unusual 
situation.
    (7) Early intervention and school programs. (i) General. If you are 
a very young child who has been identified for early intervention 
services, or if you attend school (including preschool), the records of 
people who know you or who have examined you are important sources of 
information about your impairment(s) and its effects on your 
functioning. Records from physicians, teachers and school 
psychologists, or physical, occupational, or speech-language therapists 
are examples of what we will consider. If you receive early 
intervention services or go to school or preschool, we will consider 
this information when it is relevant and available to us.
    (ii) School evidence. If you go to school or preschool, we will ask 
your teacher(s) about your performance in your activities throughout 
your school day. We will consider all the evidence we receive from your 
school, including teacher questionnaires, teacher checklists, group 
achievement testing, and report cards.
    (iii) Early intervention and special education programs. If you 
have received a comprehensive assessment for early intervention 
services or special education services, we will consider information 
used by the assessment team to make its recommendations. We will 
consider the information in your Individualized Family Service Plan, 
your Individualized Education Program, or your plan for transition 
services to help us understand your functioning. We will examine the 
goals and objectives of your plan or program as further indicators of 
your functioning, as well as statements regarding related services, 
supplementary aids, program modifications, and other accommodations 
recommended to help you function, together with the other relevant 
information in your case record.
    (iv) Special education or accommodations. We will consider the fact 
that you attend school, that you may be placed in a special education 
setting, or that you receive accommodations because of your impairments 
along with the other information in your case record. The fact that you 
attend school does not mean that you are not disabled. The fact that 
you do or do not receive special education services does not, in 
itself, establish your actual limitations or abilities. Children are 
placed in special education settings, or are included in regular 
classrooms (with or without accommodation), for many reasons that may 
or may not be related to the level of their impairments. For example, 
you may receive one-to-one assistance from an aide throughout the day 
in a regular classroom, or be placed in a special classroom. We will 
consider the circumstances of your school attendance, such as your 
ability to function in a regular classroom or preschool setting with 
children your age who do not have impairments. Similarly, we will 
consider that good performance in a special education setting does not 
mean that you are functioning at the same level as other children your 
age who do not have impairments.
    (v) Attendance and participation. We will also consider factors 
affecting your ability to participate in your education program. You 
may be unable to participate on a regular basis because of the chronic 
or episodic nature of your impairment(s) or your need for therapy or 
treatment. If you have more than one impairment, we will look at 
whether the effects of your impairments taken together make you unable 
to participate on a regular basis. We will consider how your temporary 
removal or absence from the program affects your ability to function 
compared to other children your age who do not have impairments.
    (8) The impact of chronic illness and limitations that interfere 
with your activities over time. If you have a chronic impairment(s) 
that is characterized by episodes of exacerbation (worsening) and 
remission (improvement), we will consider the frequency and severity of 
your episodes of exacerbation as factors that may be limiting your 
functioning. Your level of functioning may vary considerably over time. 
Proper evaluation of your ability to function in any domain requires us 
to take into account any variations in your level of functioning to 
determine the impact of your chronic illness on your ability to 
function over time. If you require frequent treatment, we will consider 
it as explained in paragraph (b)(9)(ii) of this section.
    (9) The effects of treatment (including medications and other 
treatment). We will evaluate the effects of your treatment to determine 
its effect on your functioning in your particular case.
    (i) Effects of medications. We will consider the effects of 
medication on your symptoms, signs, laboratory findings, and 
functioning. Although medications may control the most obvious 
manifestations of your impairment(s), they may or may not affect the 
functional limitations imposed by your impairment(s). If your symptoms 
or signs are reduced by medications, we will consider:
    (A) Any of your functional limitations that may nevertheless 
persist, even if there is improvement from the medications;
    (B) Whether your medications create any side effects that cause or 
contribute to your functional limitations;
    (C) The frequency of your need for medication;
    (D) Changes in your medication or the way your medication is 
prescribed; and (E) Any evidence over time of how medication helps or 
does not help you to function compared to other children your age who 
do not have impairments.
    (ii) Other treatment. We will also consider the level and frequency 
of treatment other than medications that you get for your 
impairment(s). You may need frequent and ongoing therapy from one or 
more medical sources to maintain or improve your functional status. 
(Examples of therapy include occupational, physical, or speech and 
language therapy, nursing or home health services, psychotherapy, or 
psychosocial counseling.) Frequent therapy, although intended to 
improve your functioning in some ways, may also interfere with your 
functioning in other ways. Therefore, we will consider the frequency of 
any therapy you must have, and how long you have received or will need 
it. We will also consider whether the therapy interferes with your 
participation in activities typical of other children your age who do 
not have impairments, such as attending school or classes and 
socializing with your

[[Page 54782]]

peers. If you must frequently interrupt your activities at school or at 
home for therapy, we will consider whether these interruptions 
interfere with your functioning. We will also consider the length and 
frequency of your hospitalizations.
    (iii) Treatment and intervention, in general. With treatment or 
intervention, you may not only have your symptoms or signs reduced, but 
may also maintain, return to, or achieve a level of functioning that is 
not disabling. Treatment or intervention may prevent, eliminate, or 
reduce functional limitations.

    14. Section 416.925 is amended by revising the sixth and seventh 
sentences of paragraph (b)(2) to read as follows:


Sec. 416.925  Listing of Impairments in appendix 1 of subpart P of part 
404 of this chapter.

* * * * *
    (b) * * *
    (2) * * * Although the severity criteria in part B of the listings 
are expressed in different ways for different impairments, ``listing-
level severity'' generally means the level of severity described in 
Sec. 416.926a(a); i.e., ``marked'' limitations in two domains of 
functioning or an ``extreme'' limitation in one domain. (See 
Sec. 416.926a(e) for the definitions of the terms ``marked'' and 
``extreme'' as they apply to children.) * * *
* * * * *

    15. Section 416.926a is amended by:
    A. Revising paragraphs (a), (b), and (c);
    B. Redesignating paragraph (d) as paragraph (m);
    C. Redesignating paragraph (e) as paragraph (n);
    D. Adding new paragraphs (d) through (l);
    E. Removing paragraphs (m)(5) and (m)(10);
    F. Redesignating paragraphs (m)(6) as (m)(5), (m)(7) as (m)(6), 
(m)(8) as (m)(7), (m)(9) as (m)(8), (m)(11) as (m)(9), and (m)(12) as 
(m)(10), and
    G. By revising the heading and introductory text of paragraph (m) 
to read as follows:


Sec. 416.926a  Functional equivalence for children.

    (a) General. If you have a severe impairment or combination of 
impairments that does not meet or medically equal any listing, we will 
decide whether it results in limitations that functionally equal the 
listings. By ``functionally equal the listings,'' we mean that your 
impairment(s) must be of listing-level severity; i.e., it must result 
in ``marked'' limitations in two domains of functioning or an 
``extreme'' limitation in one domain, as explained in this section. We 
will assess the functional limitations caused by your impairment(s); 
i.e., what you cannot do, have difficulty doing, need help doing, or 
are restricted from doing because of your impairment(s). When we make a 
finding regarding functional equivalence, we will assess the 
interactive and cumulative effects of all of the impairments for which 
we have evidence, including any impairments you have that are not 
``severe.'' (See Sec. 416.924(c).) When we assess your functional 
limitations, we will consider all the relevant factors in 
Secs. 416.924a, 416.924b, and 416.929 including, but not limited to:
    (1) How well you can initiate and sustain activities, how much 
extra help you need, and the effects of structured or supportive 
settings (see Sec. 416.924a(b)(5));
    (2) How you function in school (see Sec. 416.924a(b)(7)); and
    (3) The effects of your medications or other treatment (see 
Sec. 416.924a(b)(9)).
    (b) How we will consider your functioning. We will look at the 
information we have in your case record about how your functioning is 
affected during all of your activities when we decide whether your 
impairment or combination of impairments functionally equals the 
listings. Your activities are everything you do at home, at school, and 
in your community. We will look at how appropriately, effectively, and 
independently you perform your activities compared to the performance 
of other children your age who do not have impairments.
    (1) We will consider how you function in your activities in terms 
of six domains. These domains are broad areas of functioning intended 
to capture all of what a child can or cannot do. In paragraphs (g) 
through (l), we describe each domain in general terms. For most of the 
domains, we also provide examples of activities that illustrate the 
typical functioning of children in different age groups. For all of the 
domains, we also provide examples of limitations within the domains. 
However, we recognize that there is a range of development and 
functioning, and that not all children within an age category are 
expected to be able to do all of the activities in the examples of 
typical functioning. We also recognize that limitations of any of the 
activities in the examples do not necessarily mean that a child has a 
``marked'' or ``extreme'' limitation, as defined in paragraph (e) of 
this section. The domains we use are:
    (i) Acquiring and using information;
    (ii) Attending and completing tasks;
    (iii) Interacting and relating with others;
    (iv) Moving about and manipulating objects;
    (v) Caring for yourself; and,
    (vi) Health and physical well-being.
    (2) When we evaluate your ability to function in each domain, we 
will ask for and consider information that will help us answer the 
following questions about whether your impairment(s) affects your 
functioning and whether your activities are typical of other children 
your age who do not have impairments.
    (i) What activities are you able to perform?
    (ii) What activities are you not able to perform?
    (iii) Which of your activities are limited or restricted compared 
to other children your age who do not have impairments?
    (iv) Where do you have difficulty with your activities-at home, in 
childcare, at school, or in the community?
    (v) Do you have difficulty independently initiating, sustaining, or 
completing activities?
    (vi) What kind of help do you need to do your activities, how much 
help do you need, and how often do you need it?
    (3) We will try to get information from sources who can tell us 
about the effects of your impairment(s) and how you function. We will 
ask for information from your treating and other medical sources who 
have seen you and can give us their medical findings and opinions about 
your limitations and restrictions. We will also ask for information 
from your parents and teachers, and may ask for information from others 
who see you often and can describe your functioning at home, in 
childcare, at school, and in your community. We may also ask you to go 
to a consultative examination(s) at our expense. (See Secs. 416.912-
416.919a regarding medical evidence and when we will purchase a 
consultative examination.)
    (c) The interactive and cumulative effects of an impairment or 
multiple impairments. When we evaluate your functioning and decide 
which domains may be affected by your impairment(s), we will look first 
at your activities and your limitations and restrictions. Any given 
activity may involve the integrated use of many abilities and skills; 
therefore, any single limitation may be the result of the interactive 
and cumulative effects of one or more impairments. And any given 
impairment may have effects in more than one domain; therefore, we will 
evaluate the limitations from your

[[Page 54783]]

impairment(s) in any affected domain(s).
    (d) How we will decide that your impairment(s) functionally equals 
the listings. We will decide that your impairment(s) functionally 
equals the listings if it is of listing-level severity. Your 
impairment(s) is of listing-level severity if you have ``marked'' 
limitations in two of the domains in paragraph (b)(1) of this section, 
or an ``extreme'' limitation in one domain. We will not compare your 
functioning to the requirements of any specific listing. We explain 
what the terms ``marked'' and ``extreme'' mean in paragraph (e) of this 
section. We explain how we use the domains in paragraph (f) of this 
section, and describe each domain in paragraphs (g)-(l). You must also 
meet the duration requirement. (See Sec. 416.909.)
    (e) How we define ``marked'' and ``extreme'' limitations.
    (1) General. (i) When we decide whether you have a ``marked'' or an 
``extreme'' limitation, we will consider your functional limitations 
resulting from all of your impairments, including their interactive and 
cumulative effects. We will consider all the relevant information in 
your case record that helps us determine your functioning, including 
your signs, symptoms, and laboratory findings, the descriptions we have 
about your functioning from your parents, teachers, and other people 
who know you, and the relevant factors explained in Secs. 416.924a, 
416.924b, and 416.929.
    (ii) The medical evidence may include formal testing that provides 
information about your development or functioning in terms of 
percentiles, percentages of delay, or age or grade equivalents. 
Standard scores (e.g., percentiles) can be converted to standard 
deviations. When you have such scores, we will consider them together 
with the information we have about your functioning to determine 
whether you have a ``marked'' or ``extreme'' limitation in a domain.
    (2) Marked limitation. (i) We will find that you have a ``marked'' 
limitation in a domain when your impairment(s) interferes seriously 
with your ability to independently initiate, sustain, or complete 
activities. Your day-to-day functioning may be seriously limited when 
your impairment(s) limits only one activity or when the interactive and 
cumulative effects of your impairment(s) limit several activities. 
``Marked'' limitation also means a limitation that is ``more than 
moderate'' but ``less than extreme.'' It is the equivalent of the 
functioning we would expect to find on standardized testing with scores 
that are at least two, but less than three, standard deviations below 
the mean.
    (ii) If you have not attained age 3, we will generally find that 
you have a ``marked'' limitation if you are functioning at a level that 
is more than one-half but not more than two-thirds of your 
chronological age when there are no standard scores from standardized 
tests in your case record.
    (iii) If you are a child of any age (birth to the attainment of age 
18), we will find that you have a ``marked'' limitation when you have a 
valid score that is two standard deviations or more below the mean, but 
less than three standard deviations, on a comprehensive standardized 
test designed to measure ability or functioning in that domain, and 
your day-to-day functioning in domain-related activities is consistent 
with that score. (See paragraph (e)(4) of this section.)
    (iv) For the sixth domain of functioning, ``Health and physical 
well-being,'' we may also consider you to have a ``marked'' limitation 
if you are frequently ill because of your impairment(s) or have 
frequent exacerbations of your impairment(s) that result in 
significant, documented symptoms or signs. For purposes of this domain, 
``frequent means that you have episodes of illness or exacerbations 
that occur on an average of 3 times a year, or once every 4 months, 
each lasting 2 weeks or more. We may also find that you have a 
``marked'' limitation if you have episodes that occur more often than 3 
times in a year or once every 4 months but do not last for 2 weeks, or 
occur less often than an average of 3 times a year or once every 4 
months but last longer than 2 weeks, if the overall effect (based on 
the length of the episode(s) or its frequency) is equivalent in 
severity.
    (3) Extreme limitation. (i) We will find that you have an 
``extreme'' limitation in a domain when your impairment(s) interferes 
very seriously with your ability to independently initiate, sustain, or 
complete activities. Your day-to-day functioning may be very seriously 
limited when your impairment(s) limits only one activity or when the 
interactive and cumulative effects of your impairment(s) limit several 
activities. ``Extreme'' limitation also means a limitation that is 
``more than marked.'' ``Extreme'' limitation is the rating we give to 
the worst limitations. However, ``extreme limitation'' does not 
necessarily mean a total lack or loss of ability to function. It is the 
equivalent of the functioning we would expect to find on standardized 
testing with scores that are at least three standard deviations below 
the mean.
    (ii) If you have not attained age 3, we will generally find that 
you have an ``extreme'' limitation if you are functioning at a level 
that is one-half of your chronological age or less when there are no 
standard scores from standardized tests in your case record.
    (iii) If you are a child of any age (birth to the attainment of age 
18), we will find that you have an ``extreme'' limitation when you have 
a valid score that is three standard deviations or more below the mean 
on a comprehensive standardized test designed to measure ability or 
functioning in that domain, and your day-to-day functioning in domain-
related activities is consistent with that score. (See paragraph (e)(4) 
of this section.)
    (iv) For the sixth domain of functioning, ``Health and physical 
well-being,'' we may also consider you to have an ``extreme'' 
limitation if you are ill because of your impairment(s) or have 
exacerbations of your impairment(s) that result in significant, 
documented symptoms or signs substantially in excess of the 
requirements for showing a ``marked'' limitation in paragraph 
(e)(2)(iv) of this section. However, if you have episodes of illness or 
exacerbations of your impairment(s) that we would rate as ``extreme'' 
under this definition, your impairment(s) should meet or medically 
equal the requirements of a listing in most cases. See Secs. 416.925 
and 416.926.
    (4) How we will consider your test scores. (i) As indicated in 
Sec. 416.924a(a)(1)(ii), we will not rely on any test score alone. No 
single piece of information taken in isolation can establish whether 
you have a ``marked'' or an ``extreme'' limitation in a domain.
    (ii) We will consider your test scores together with the other 
information we have about your functioning, including reports of 
classroom performance and the observations of school personnel and 
others.
    (A) We may find that you have a ``marked'' or ``extreme'' 
limitation when you have a test score that is slightly higher than the 
level provided in paragraph (e)(2) or (e)(3) of this section, if other 
information in your case record shows that your functioning in day-to-
day activities is seriously or very seriously limited because of your 
impairment(s). For example, you may have IQ scores above the level in 
paragraph (e)(2), but other evidence shows that your impairment(s) 
causes you to function in school, home, and the community far below 
your expected level of functioning based on this score.
    (B) On the other hand, we may find that you do not have a 
``marked'' or ``extreme'' limitation, even if your test

[[Page 54784]]

scores are at the level provided in paragraph (e)(2) or (e)(3) of this 
section, if other information in your case record shows that your 
functioning in day-to-day activities is not seriously or very seriously 
limited by your impairment(s). For example, you may have a valid IQ 
score below the level in paragraph (e)(2), but other evidence shows 
that you have learned to drive a car, shop independently, and read 
books near your expected grade level.
    (iii) If there is a material inconsistency between your test scores 
and other information in your case record, we will try to resolve it. 
The interpretation of the test is primarily the responsibility of the 
psychologist or other professional who administered the test. But it is 
also our responsibility to ensure that the evidence in your case is 
complete and consistent or that any material inconsistencies have been 
resolved. Therefore, we will use the following guidelines when we 
resolve concerns about your test scores:
    (A) We may be able to resolve the inconsistency with the 
information we have. We may need to obtain additional information; 
e.g., by recontact with your medical source(s), by purchase of a 
consultative examination to provide further medical information, by 
recontact with a medical source who provided a consultative 
examination, or by questioning individuals familiar with your day-to-
day functioning.
    (B) Generally, we will not rely on a test score as a measurement of 
your functioning within a domain when the information we have about 
your functioning is the kind of information typically used by medical 
professionals to determine that the test results are not the best 
measure of your day-to-day functioning. When we do not rely on test 
scores, we will explain our reasons for doing so in your case record or 
in our decision.
    (f) How we will use the domains to help us evaluate your 
functioning. (1) When we consider whether you have ``marked'' or 
``extreme'' limitations in any domain, we examine all the information 
we have in your case record about how your functioning is limited 
because of your impairment(s), and we compare your functioning to the 
typical functioning of children your age who do not have impairments.
    (2) The general descriptions of each domain in paragraphs (g)-(l) 
help us decide whether you have limitations in any given domain and 
whether these limitations are ``marked'' or ``extreme.''
    (3) The domain descriptions also include examples of some 
activities typical of children in each age group and some functional 
limitations that we may consider. These examples also help us decide 
whether you have limitations in a domain because of your impairment(s). 
The examples are not all-inclusive, and we will not require our 
adjudicators to develop evidence about each specific example. When you 
have limitations in a given activity or activities in the examples, we 
may or may not decide that you have a ``marked'' or ``extreme'' 
limitation in the domain. We will consider the activities in which you 
are limited because of your impairment(s) and the extent of your 
limitations under the rules in paragraph (e) of this section. We will 
also consider all of the relevant provisions of Secs. 416.924a, 
416.924b, and 416.929.
    (g) Acquiring and using information. In this domain, we consider 
how well you acquire or learn information, and how well you use the 
information you have learned.
    (1) General. (i) Learning and thinking begin at birth. You learn as 
you explore the world through sight, sound, taste, touch, and smell. As 
you play, you acquire concepts and learn that people, things, and 
activities have names. This lets you understand symbols, which prepares 
you to use language for learning. Using the concepts and symbols you 
have acquired through play and learning experiences, you should be able 
to learn to read, write, do arithmetic, and understand and use new 
information.
    (ii) Thinking is the application or use of information you have 
learned. It involves being able to perceive relationships, reason, and 
make logical choices. People think in different ways. When you think in 
pictures, you may solve a problem by watching and imitating what 
another person does. When you think in words, you may solve a problem 
by using language to talk your way through it. You must also be able to 
use language to think about the world and to understand others and 
express yourself; e.g., to follow directions, ask for information, or 
explain something.
    (2) Age group descriptors. (i) Newborns and young infants (birth to 
attainment of age 1). At this age, you should show interest in, and 
explore, your environment. At first, your actions are random; for 
example, when you accidentally touch the mobile over your crib. 
Eventually, your actions should become deliberate and purposeful, as 
when you shake noisemaking toys like a bell or rattle. You should begin 
to recognize, and then anticipate, routine situations and events, as 
when you grin with expectation at the sight of your stroller. You 
should also recognize and gradually attach meaning to everyday sounds, 
as when you hear the telephone or your name. Eventually, you should 
recognize and respond to familiar words, including family names and 
what your favorite toys and activities are called.
    (ii) Older infants and toddlers (age 1 to attainment of age 3). At 
this age, you are learning about the world around you. When you play, 
you should learn how objects go together in different ways. You should 
learn that by pretending, your actions can represent real things. This 
helps you understand that words represent things, and that words are 
simply symbols or names for toys, people, places, and activities. You 
should refer to yourself and things around you by pointing and 
eventually by naming. You should form concepts and solve simple 
problems through purposeful experimentation (e.g., taking toys apart), 
imitation, constructive play (e.g., building with blocks), and pretend 
play activities. You should begin to respond to increasingly complex 
instructions and questions, and to produce an increasing number of 
words and grammatically correct simple sentences and questions.
    (iii) Preschool children (age 3 to attainment of age 6). When you 
are old enough to go to preschool or kindergarten, you should begin to 
learn and use the skills that will help you to read and write and do 
arithmetic when you are older. For example, listening to stories, 
rhyming words, and matching letters are skills needed for learning to 
read. Counting, sorting shapes, and building with blocks are skills 
needed to learn math. Painting, coloring, copying shapes, and using 
scissors are some of the skills needed in learning to write. Using 
words to ask questions, give answers, follow directions, describe 
things, explain what you mean, and tell stories allows you to acquire 
and share knowledge and experience of the world around you. All of 
these are called ``readiness skills,'' and you should have them by the 
time you begin first grade.
    (iv) School-age children (age 6 to attainment of age 12). When you 
are old enough to go to elementary and middle school, you should be 
able to learn to read, write, and do math, and discuss history and 
science. You will need to use these skills in academic situations to 
demonstrate what you have learned; e.g., by reading about various 
subjects and producing oral and written projects, solving mathematical 
problems, taking achievement tests, doing group work, and entering into 
class discussions. You will also need to use these skills in daily 
living situations at home and in the community (e.g., reading street 
signs,

[[Page 54785]]

telling time, and making change). You should be able to use 
increasingly complex language (vocabulary and grammar) to share 
information and ideas with individuals or groups, by asking questions 
and expressing your own ideas, and by understanding and responding to 
the opinions of others.
    (v) Adolescents (age 12 to attainment of age 18). In middle and 
high school, you should continue to demonstrate what you have learned 
in academic assignments (e.g., composition, classroom discussion, and 
laboratory experiments). You should also be able to use what you have 
learned in daily living situations without assistance (e.g., going to 
the store, using the library, and using public transportation). You 
should be able to comprehend and express both simple and complex ideas, 
using increasingly complex language (vocabulary and grammar) in 
learning and daily living situations (e.g., to obtain and convey 
information and ideas). You should also learn to apply these skills in 
practical ways that will help you enter the workplace after you finish 
school (e.g., carrying out instructions, preparing a job application, 
or being interviewed by a potential employer).
    (3) Examples of limited functioning in acquiring and using 
information. The following examples describe some limitations we may 
consider in this domain. Your limitations may be different from the 
ones listed here. Also, the examples do not necessarily describe a 
``marked'' or ``extreme'' limitation. Whether an example applies in 
your case may depend on your age and developmental stage; e.g., an 
example below may describe a limitation in an older child, but not a 
limitation in a younger one. As in any case, your limitations must 
result from your medically determinable impairment(s). However, we will 
consider all of the relevant information in your case record when we 
decide whether your medically determinable impairment(s) results in a 
``marked'' or ``extreme'' limitation in this domain.
    (i) You do not demonstrate understanding of words about space, 
size, or time; e.g., in/under, big/little, morning/night.
    (ii) You cannot rhyme words or the sounds in words.
    (iii) You have difficulty recalling important things you learned
    in school yesterday.
    (iv) You have difficulty solving mathematics questions or computing 
arithmetic answers.
    (v) You talk only in short, simple sentences and have difficulty 
explaining what you mean.
    (h) Attending and completing tasks. In this domain, we consider how 
well you are able to focus and maintain your attention, and how well 
you begin, carry through, and finish your activities, including the 
pace at which you perform activities and the ease with which you change 
them.
    (1) General. (i) Attention involves regulating your levels of 
alertness and initiating and maintaining concentration. It involves the 
ability to filter out distractions and to remain focused on an activity 
or task at a consistent level of performance. This means focusing long 
enough to initiate and complete an activity or task, and changing focus 
once it is completed. It also means that if you lose or change your 
focus in the middle of a task, you are able to return to the task 
without other people having to remind you frequently to finish it.
    (ii) Adequate attention is needed to maintain physical and mental 
effort and concentration on an activity or task. Adequate attention 
permits you to think and reflect before starting or deciding to stop an 
activity. In other words, you are able to look ahead and predict the 
possible outcomes of your actions before you act. Focusing your 
attention allows you to attempt tasks at an appropriate pace. It also 
helps you determine the time needed to finish a task within an 
appropriate timeframe.
    (2) Age group descriptors. (i) Newborns and young infants (birth to 
attainment of age 1). You should begin at birth to show sensitivity to 
your environment by responding to various stimuli (e.g., light, touch, 
temperature, movement). Very soon, you should be able to fix your gaze 
on a human face. You should stop your activity when you hear voices or 
sounds around you. Next, you should begin to attend to and follow 
various moving objects with your gaze, including people or toys. You 
should be listening to your family's conversations for longer and 
longer periods of time. Eventually, as you are able to move around and 
explore your environment, you should begin to play with people and toys 
for longer periods of time. You will still want to change activities 
frequently, but your interest in continuing interaction or a game 
should gradually expand.
    (ii) Older infants and toddlers (age 1 to attainment of age 3). At 
this age, you should be able to attend to things that interest you and 
have adequate attention to complete some tasks by yourself. As a 
toddler, you should demonstrate sustained attention, such as when 
looking at picture books, listening to stories, or building with 
blocks, and when helping to put on your clothes.
    (iii) Preschool children (age 3 to attainment of age 6). As a 
preschooler, you should be able to pay attention when you are spoken to 
directly, sustain attention to your play and learning activities, and 
concentrate on activities like putting puzzles together or completing 
art projects. You should also be able to focus long enough to do many 
more things by yourself, such as getting your clothes together and 
dressing yourself, feeding yourself, or putting away your toys. You 
should usually be able to wait your turn and to change your activity 
when a caregiver or teacher says it is time to do something else.
    (iv) School-age children (age 6 to attainment of age 12). When you 
are of school age, you should be able to focus your attention in a 
variety of situations in order to follow directions, remember and 
organize your school materials, and complete classroom and homework 
assignments. You should be able to concentrate on details and not make 
careless mistakes in your work (beyond what would be expected in other 
children your age who do not have impairments). You should be able to 
change your activities or routines without distracting yourself or 
others, and stay on task and in place when appropriate. You should be 
able to sustain your attention well enough to participate in group 
sports, read by yourself, and complete family chores. You should also 
be able to complete a transition task (e.g., be ready for the school 
bus, change clothes after gym, change classrooms) without extra 
reminders and accommodation.
    (v) Adolescents (age 12 to attainment of age 18). In your later 
years of school, you should be able to pay attention to increasingly 
longer presentations and discussions, maintain your concentration while 
reading textbooks, and independently plan and complete long-range 
academic projects. You should also be able to organize your materials 
and to plan your time in order to complete school tasks and 
assignments. In anticipation of entering the workplace, you should be 
able to maintain your attention on a task for extended periods of time, 
and not be unduly distracted by your peers or unduly distracting to 
them in a school or work setting.
    (3) Examples of limited functioning in attending and completing 
tasks. The following examples describe some limitations we may consider 
in this domain. Your limitations may be different from the ones listed 
here. Also, the examples do not necessarily describe a ``marked'' or 
``extreme'' limitation. Whether an example applies

[[Page 54786]]

in your case may depend on your age and developmental stage; e.g., an 
example below may describe a limitation in an older child, but not a 
limitation in a younger one. As in any case, your limitations must 
result from your medically determinable impairment(s). However, we will 
consider all of the relevant information in your case record when we 
decide whether your medically determinable impairment(s) results in a 
``marked'' or ``extreme'' limitation in this domain.
    (i) You are easily startled, distracted, or overreactive to sounds, 
sights, movements, or touch.
    (ii) You are slow to focus on, or fail to complete activities of 
interest to you, e.g., games or art projects.
    (iii) You repeatedly become sidetracked from your activities or you 
frequently interrupt others.
    (iv) You are easily frustrated and give up on tasks, including ones 
you are capable of completing.
    (v) You require extra supervision to keep you engaged in an 
activity.
    (i) Interacting and relating with others. In this domain, we 
consider how well you initiate and sustain emotional connections with 
others, develop and use the language of your community, cooperate with 
others, comply with rules, respond to criticism, and respect and take 
care of the possessions of others.
    (1) General. (i) Interacting means initiating and responding to 
exchanges with other people, for practical or social purposes. You 
interact with others by using facial expressions, gestures, actions, or 
words. You may interact with another person only once, as when asking a 
stranger for directions, or many times, as when describing your day at 
school to your parents. You may interact with people one-at-a-time, as 
when you are listening to another student in the hallway at school, or 
in groups, as when you are playing with others.
    (ii) Relating to other people means forming intimate relationships 
with family members and with friends who are your age, and sustaining 
them over time. You may relate to individuals, such as your siblings, 
parents or best friend, or to groups, such as other children in 
childcare, your friends in school, teammates in sports activities, or 
people in your neighborhood.
    (iii) Interacting and relating require you to respond appropriately 
to a variety of emotional and behavioral cues. You must be able to 
speak intelligibly and fluently so that others can understand you; 
participate in verbal turntaking and nonverbal exchanges; consider 
others' feelings and points of view; follow social rules for 
interaction and conversation; and respond to others appropriately and 
meaningfully.
    (iv) Your activities at home or school or in your community may 
involve playing, learning, and working cooperatively with other 
children, one-at-a-time or in groups; joining voluntarily in activities 
with the other children in your school or community; and responding to 
persons in authority (e.g., your parent, teacher, bus driver, coach, or 
employer).
    (2) Age group descriptors. (i) Newborns and young infants (birth to 
attainment of age 1). You should begin to form intimate relationships 
at birth by gradually responding visually and vocally to your 
caregiver(s), through mutual gaze and vocal exchanges, and by 
physically molding your body to the caregiver's while being held. You 
should eventually initiate give-and-take games (such as pat-a-cake, 
peek-a-boo) with your caregivers, and begin to affect others through 
your own purposeful behavior (e.g., gestures and vocalizations). You 
should be able to respond to a variety of emotions (e.g., facial 
expressions and vocal tone changes). You should begin to develop speech 
by using vowel sounds and later consonants, first alone, and then in 
babbling.
    (ii) Older infants and toddlers (age 1 to attainment of age 3). At 
this age, you are dependent upon your caregivers, but should begin to 
separate from them. You should be able to express emotions and respond 
to the feelings of others. You should begin initiating and maintaining 
interactions with adults, but also show interest in, then play 
alongside, and eventually interact with other children your age. You 
should be able to spontaneously communicate your wishes or needs, first 
by using gestures, and eventually by speaking words clearly enough that 
people who know you can understand what you say most of the time.
    (iii) Preschool children (age 3 to attainment of age 6). At this 
age, you should be able to socialize with children as well as adults. 
You should begin to prefer playmates your own age and start to develop 
friendships with children who are your age. You should be able to use 
words instead of actions to express yourself, and also be better able 
to share, show affection, and offer to help. You should be able to 
relate to caregivers with increasing independence, choose your own 
friends, and play cooperatively with other children, one-at-a-time or 
in a group, without continual adult supervision. You should be able to 
initiate and participate in conversations, using increasingly complex 
vocabulary and grammar, and speaking clearly enough that both familiar 
and unfamiliar listeners can understand what you say most of the time.
    (iv) School-age children (age 6 to attainment of age 12). When you 
enter school, you should be able to develop more lasting friendships 
with children who are your age. You should begin to understand how to 
work in groups to create projects and solve problems. You should have 
an increasing ability to understand another's point of view and to 
tolerate differences. You should be well able to talk to people of all 
ages, to share ideas, tell stories, and to speak in a manner that both 
familiar and unfamiliar listeners readily understand.
    (v) Adolescents (age 12 to attainment of age 18). By the time you 
reach adolescence, you should be able to initiate and develop 
friendships with children who are your age and to relate appropriately 
to other children and adults, both individually and in groups. You 
should begin to be able to solve conflicts between yourself and peers 
or family members or adults outside your family. You should recognize 
that there are different social rules for you and your friends and for 
acquaintances or adults. You should be able to intelligibly express 
your feelings, ask for assistance in getting your needs met, seek 
information, describe events, and tell stories, in all kinds of 
environments (e.g., home, classroom, sports, extra-curricular 
activities, or part-time job), and with all types of people (e.g., 
parents, siblings, friends, classmates, teachers, employers, and 
strangers).
    (3) Examples of limited functioning in interacting and relating 
with others. The following examples describe some limitations we may 
consider in this domain. Your limitations may be different from the 
ones listed here. Also, the examples do not necessarily describe a 
``marked'' or ``extreme'' limitation. Whether an example applies in 
your case may depend on your age and developmental stage; e.g., an 
example below may describe a limitation in an older child, but not a 
limitation in a younger one. As in any case, your limitations must 
result from your medically determinable impairment(s). However, we will 
consider all of the relevant information in your case record when we 
decide whether your medically determinable impairment(s) results in a 
``marked'' or ``extreme'' limitation in this domain.
    (i) You do not reach out to be picked up and held by your 
caregiver.
    (ii) You have no close friends, or your friends are all older or 
younger than you.

[[Page 54787]]

    (iii) You avoid or withdraw from people you know, or you are overly 
anxious or fearful of meeting new people or trying new experiences.
    (iv) You have difficulty playing games or sports with rules.
    (v) You have difficulty communicating with others; e.g., in using 
verbal and nonverbal skills to express yourself, carrying on a 
conversation, or in asking others for assistance.
    (vi) You have difficulty speaking intelligibly or with adequate 
fluency.
    (j) Moving about and manipulating objects. In this domain, we 
consider how you move your body from one place to another and how you 
move and manipulate things. These are called gross and fine motor 
skills.
    (1) General. (i) Moving your body involves several different kinds 
of actions: Rolling your body; rising or pulling yourself from a 
sitting to a standing position; pushing yourself up; raising your head, 
arms, and legs, and twisting your hands and feet; balancing your weight 
on your legs and feet; shifting your weight while sitting or standing; 
transferring yourself from one surface to another; lowering yourself to 
or toward the floor as when bending, kneeling, stooping, or crouching; 
moving yourself forward and backward in space as when crawling, 
walking, or running, and negotiating different terrains (e.g., curbs, 
steps, and hills).
    (ii) Moving and manipulating things involves several different 
kinds of actions: Engaging your upper and lower body to push, pull, 
lift, or carry objects from one place to another; controlling your 
shoulders, arms, and hands to hold or transfer objects; coordinating 
your eyes and hands to manipulate small objects or parts of objects.
    (iii) These actions require varying degrees of strength, 
coordination, dexterity, pace, and physical ability to persist at the 
task. They also require a sense of where your body is and how it moves 
in space; the integration of sensory input with motor output; and the 
capacity to plan, remember, and execute controlled motor movements.
    (2) Age group descriptors. (i) Newborns and infants (birth to 
attainment of age 1). At birth, you should begin to explore your world 
by moving your body and by using your limbs. You should learn to hold 
your head up, sit, crawl, and stand, and sometimes hold onto a stable 
object and stand actively for brief periods. You should begin to 
practice your developing eye-hand control by reaching for objects or 
picking up small objects and dropping them into containers.
    (ii) Older infants and toddlers (age 1 to attainment of age 3). At 
this age, you should begin to explore actively a wide area of your 
physical environment, using your body with steadily increasing control 
and independence from others. You should begin to walk and run without 
assistance, and climb with increasing skill. You should frequently try 
to manipulate small objects and to use your hands to do or get 
something that you want or need. Your improved motor skills should 
enable you to play with small blocks, scribble with crayons, and feed 
yourself.
    (iii) Preschool children (age 3 to attainment of age 6). As a 
preschooler, you should be able to walk and run with ease. Your gross 
motor skills should let you climb stairs and playground equipment with 
little supervision, and let you play more independently; e.g., you 
should be able to swing by yourself and may start learning to ride a 
tricycle. Your fine motor skills should also be developing. You should 
be able to complete puzzles easily, string beads, and build with an 
assortment of blocks. You should be showing increasing control of 
crayons, markers, and small pieces in board games, and should be able 
to cut with scissors independently and manipulate buttons and other 
fasteners.
    (iv) School-age children (age 6 to attainment of age 12). As a 
school-age child, your developing gross motor skills should let you 
move at an efficient pace about your school, home, and neighborhood. 
Your increasing strength and coordination should expand your ability to 
enjoy a variety of physical activities, such as running and jumping, 
and throwing, kicking, catching and hitting balls in informal play or 
organized sports. Your developing fine motor skills should enable you 
to do things like use many kitchen and household tools independently, 
use scissors, and write.
    (v) Adolescents (age 12 to attainment of age 18). As an adolescent, 
you should be able to use your motor skills freely and easily to get 
about your school, the neighborhood, and the community. You should be 
able to participate in a full range of individual and group physical 
fitness activities. You should show mature skills in activities 
requiring eye-hand coordination, and should have the fine motor skills 
needed to write efficiently or type on a keyboard.
    (3) Examples of limited functioning in moving about and 
manipulating objects. The following examples describe some limitations 
we may consider in this domain. Your limitations may be different from 
the ones listed here. Also, the examples do not necessarily describe a 
``marked'' or ``extreme'' limitation. Whether an example applies in 
your case may depend on your age and developmental stage; e.g., an 
example below may describe a limitation in an older child, but not a 
limitation in a younger one. As in any case, your limitations must 
result from your medically determinable impairment(s). However, we will 
consider all of the relevant information in your case record when we 
decide whether your medically determinable impairment(s) results in a 
``marked'' or ``extreme'' limitation in this domain.
    (i) You experience muscle weakness, joint stiffness, or sensory 
loss (e.g., spasticity, hypotonia, neuropathy, or paresthesia) that 
interferes with your motor activities (e.g., you unintentionally drop 
things).
    (ii) You have trouble climbing up and down stairs, or have jerky or 
disorganized locomotion or difficulty with your balance.
    (iii) You have difficulty coordinating gross motor movements (e.g., 
bending, kneeling, crawling, running, jumping rope, or riding a bike).
    (iv) You have difficulty with sequencing hand or finger movements.
    (v) You have difficulty with fine motor movement (e.g., gripping or 
grasping objects).
    (vi) You have poor eye-hand coordination when using a pencil or 
scissors.
    (k) Caring for yourself. In this domain, we consider how well you 
maintain a healthy emotional and physical state, including how well you 
get your physical and emotional wants and needs met in appropriate 
ways; how you cope with stress and changes in your environment; and 
whether you take care of your own health, possessions, and living area.
    (1) General. (i) Caring for yourself effectively, which includes 
regulating yourself, depends upon your ability to respond to changes in 
your emotions and the daily demands of your environment to help 
yourself and cooperate with others in taking care of your personal 
needs, health and safety. It is characterized by a sense of 
independence and competence. The effort to become independent and 
competent should be observable throughout your childhood.
    (ii) Caring for yourself effectively means becoming increasingly 
independent in making and following your own decisions. This entails 
relying on your own abilities and skills, and displaying consistent 
judgment about the consequences of caring for yourself. As you mature, 
using and testing your own judgment helps you develop

[[Page 54788]]

confidence in your independence and competence. Caring for yourself 
includes using your independence and competence to meet your physical 
needs, such as feeding, dressing, toileting, and bathing, appropriately 
for your age.
    (iii) Caring for yourself effectively requires you to have a basic 
understanding of your body, including its normal functioning, and of 
your physical and emotional needs. To meet these needs successfully, 
you must employ effective coping strategies, appropriate to your age, 
to identify and regulate your feelings, thoughts, urges, and 
intentions. Such strategies are based on taking responsibility for 
getting your needs met in an appropriate and satisfactory manner.
    (iv) Caring for yourself means recognizing when you are ill, 
following recommended treatment, taking medication as prescribed, 
following safety rules, responding to your circumstances in safe and 
appropriate ways, making decisions that do not endanger yourself, and 
knowing when to ask for help from others.
    (2) Age group descriptors. (i) Newborns and infants (birth to 
attainment of age 1. Your sense of independence and competence begins 
in being able to recognize your body's signals (e.g., hunger, pain, 
discomfort), to alert your caregiver to your needs (e.g., by crying), 
and to console yourself (e.g., by sucking on your hand) until help 
comes. As you mature, your capacity for self-consolation should expand 
to include rhythmic behaviors (e.g., rocking). Your need for a sense of 
competence also emerges in things you try to do for yourself, perhaps 
before you are ready to do them, as when insisting on putting food in 
your mouth and refusing your caregiver's help.
    (ii) Older infants and toddlers (age 1 to attainment of age 3). As 
you grow, you should be trying to do more things for yourself that 
increase your sense of independence and competence in your environment. 
You might console yourself by carrying a favorite blanket with you 
everywhere. You should be learning to cooperate with your caregivers 
when they take care of your physical needs, but you should also want to 
show what you can do; e.g., pointing to the bathroom, pulling off your 
coat. You should be experimenting with your independence by showing 
some degree of contrariness (e.g., ``No! No!'') and identity (e.g., 
hoarding your toys).
    (iii) Preschool children (age 3 to attainment of age 6). You should 
want to take care of many of your physical needs by yourself (e.g., 
putting on your shoes, getting a snack), and also want to try doing 
some things that you cannot do fully (e.g., tying your shoes, climbing 
on a chair to reach something up high, taking a bath). Early in this 
age range, it may be easy for you to agree to do what your caregiver 
asks. Later, that may be difficult for you because you want to do 
things your way or not at all. These changes usually mean that you are 
more confident about your ideas and what you are able to do. You should 
also begin to understand how to control behaviors that are not good for 
you (e.g., crossing the street without an adult).
    (iv) School-age children (age 6 to attainment of age 12). You 
should be independent in most day-to-day activities (e.g., dressing 
yourself, bathing yourself), although you may still need to be reminded 
sometimes to do these routinely. You should begin to recognize that you 
are competent in doing some activities and that you have difficulty 
with others. You should be able to identify those circumstances when 
you feel good about yourself and when you feel bad. You should begin to 
develop understanding of what is right and wrong, and what is 
acceptable and unacceptable behavior. You should begin to demonstrate 
consistent control over your behavior, and you should be able to avoid 
behaviors that are unsafe or otherwise not good for you. You should 
begin to imitate more of the behavior of adults you know.
    (v) Adolescents (age 12 to attainment of age 18). You should feel 
more independent from others and should be increasingly independent in 
all of your day-to-day activities. You may sometimes experience 
confusion in the way you feel about yourself. You should begin to 
notice significant changes in your body's development, and this can 
result in anxiety or worrying about yourself and your body. Sometimes 
these worries can make you feel angry or frustrated. You should begin 
to discover appropriate ways to express your feelings, both good and 
bad (e.g., keeping a diary to sort out angry feelings or listening to 
music to calm yourself down). You should begin to think seriously about 
your future plans, and what you will do when you finish school.
    (3) Examples of limited functioning in caring for yourself. The 
following examples describe some limitations we may consider in this 
domain. Your limitations may be different from the ones listed here. 
Also, the examples do not necessarily describe a ``marked'' or 
``extreme'' limitation. Whether an example applies in your case may 
depend on your age and developmental stage; e.g., an example below may 
describe a limitation in an older child, but not a limitation in a 
younger one. As in any case, your limitations must result from your 
medically determinable impairment(s). However, we will consider all of 
the relevant information in your case record when we decide whether 
your medically determinable impairment(s) results in a ``marked'' or 
``extreme'' limitation in this domain.
    (i) You continue to place non-nutritive or inedible objects in your 
mouth.
    (ii) You often use self-soothing activities showing developmental 
regression ( e.g., thumbsucking, re-chewing food), or you have 
restrictive or stereotyped mannerisms ( e.g., body rocking, 
headbanging).
    (iii) You do not dress or bathe yourself appropriately for your age 
because you have an impairment(s) that affects this domain.
    (iv) You engage in self-injurious behavior ( e.g., suicidal 
thoughts or actions, self-inflicted injury, or refusal to take your 
medication), or you ignore safety rules.
    (v) You do not spontaneously pursue enjoyable activities or 
interests.
    (vi) You have disturbance in eating or sleeping patterns.
    (l) Health and physical well-being. In this domain, we consider the 
cumulative physical effects of physical or mental impairments and their 
associated treatments or therapies on your functioning that we did not 
consider in paragraph (j) of this section. When your physical 
impairment(s), your mental impairment(s), or your combination of 
physical and mental impairments has physical effects that cause 
``extreme'' limitation in your functioning, you will generally have an 
impairment(s) that ``meets'' or ``medically equals'' a listing.
    (1) A physical or mental disorder may have physical effects that 
vary in kind and intensity, and may make it difficult for you to 
perform your activities independently or effectively. You may 
experience problems such as generalized weakness, dizziness, shortness 
of breath, reduced stamina, fatigue, psychomotor retardation, allergic 
reactions, recurrent infection, poor growth, bladder or bowel 
incontinence, or local or generalized pain.
    (2) In addition, the medications you take ( e.g., for asthma or 
depression) or the treatments you receive ( e.g., chemotherapy or 
multiple surgeries) may have physical effects that also limit your 
performance of activities.
    (3) Your illness may be chronic with stable symptoms, or episodic 
with periods of worsening and improvement.

[[Page 54789]]

We will consider how you function during periods of worsening and how 
often and for how long these periods occur. You may be medically 
fragile and need intensive medical care to maintain your level of 
health and physical well-being. In any case, as a result of the illness 
itself, the medications or treatment you receive, or both, you may 
experience physical effects that interfere with your functioning in any 
or all of your activities.
    (4) Examples of limitations in health and physical well-being. The 
following examples describe some limitations we may consider in this 
domain. Your limitations may be different from the ones listed here. 
Also, the examples do not necessarily describe a ``marked'' or 
``extreme'' limitation. Whether an example applies in your case may 
depend on your age and developmental stage; e.g., an example below may 
describe a limitation in an older child, but not a limitation in a 
younger one. As in any case, your limitations must result from your 
medically determinable impairment(s). However, we will consider all of 
the relevant information in your case record when we decide whether 
your medically determinable impairment(s) results in a ``marked'' or 
``extreme'' limitation in this domain.
    (i) You have generalized symptoms, such as weakness, dizziness, 
agitation ( e.g., excitability), lethargy ( e.g., fatigue or loss of 
energy or stamina), or psychomotor retardation because of your 
impairment(s).
    (ii) You have somatic complaints related to your impairments (e.g., 
seizure or convulsive activity, headaches, incontinence, recurrent 
infections, allergies, changes in weight or eating habits, stomach 
discomfort, nausea, headaches, or insomnia).
    (iii) You have limitations in your physical functioning because of 
your treatment ( e.g., chemotherapy, multiple surgeries, chelation, 
pulmonary cleansing, or nebulizer treatments).
    (iv) You have exacerbations from one impairment or a combination of 
impairments that interfere with your physical functioning.
    (v) You are medically fragile and need intensive medical care to 
maintain your level of health and physical well-being.
    (m) Examples of impairments that functionally equal the listings. 
The following are some examples of impairments and limitations that 
functionally equal the listings. Findings of equivalence based on the 
disabling functional limitations of a child's impairment(s) are not 
limited to the examples in this paragraph, because these examples do 
not describe all possible effects of impairments that might be found to 
functionally equal the listings. As with any disabling impairment, the 
duration requirement must also be met (see Secs. 416.909 and 
416.924(a)). * * *
* * * * *

    16. Section 416.929 is amended by revising the second, third, 
sixth, eighth, and ninth sentences of paragraph (d)(3) and the last 
sentence of paragraph (d)(4) to read as follows:


Sec. 416.929  How we evaluate symptoms, including pain.

* * * * *
    (d) * * *
* * * * *
    (3) * * * Section 416.926 explains how we make this determination. 
Under Sec. 416.926(b), we will consider equivalence based on medical 
evidence only. * * * (If you are a child and we cannot find equivalence 
based on medical evidence only, we will consider pain and other 
symptoms under Secs. 416.924a and 416.926a in determining whether you 
have an impairment(s) that functionally equals the listings.) * * * (If 
you are a child and your impairment(s) functionally equals the listings 
under the rules in Sec. 416.926a, we will also find you disabled.) If 
they are not, we will consider the impact of your symptoms on your 
residual functional capacity if you are an adult. * * *
    (4) * * * (See Secs. 416.945 and 416.924a-416.924b.)

    17. Section 416.987 is revised to read as follows:


Sec. 416.987  Disability redeterminations for individuals who attain 
age 18.

    (a) Who is affected by this section? (1) We must redetermine your 
eligibility if you are eligible for SSI disability benefits and:
    (i) You are at least 18 years old; and
    (ii) You became eligible for SSI disability benefits as a child 
(i.e., before you attained age 18); and
    (iii) You were eligible for such benefits for the month before the 
month in which you attained age 18.
    (2) We may find that you are not now disabled even though we 
previously found that you were disabled.
    (b) What are the rules for age-18 redeterminations? When we 
redetermine your eligibility, we will use the rules for adults 
(individuals age 18 or older) who file new applications explained in 
Secs. 416.920(c) through (f). We will not use the rule in 
Sec. 416.920(b) for people who are doing substantial gainful activity, 
and we will not use the rules in Sec. 416.994 for determining whether 
disability continues. If you are working and we find that you are 
disabled under Sec. 416.920(d) or (f), we will apply the rules in 
Secs. 416.260ff.
    (c) When will my eligibility be redetermined? We will redetermine 
your eligibility either during the 1-year period beginning on your 18th 
birthday or, in lieu of a continuing disability review, whenever we 
determine that your case is subject to redetermination under the Act.
    (d) Will I be notified? (1) We will notify you in writing before we 
begin your disability redetermination. We will tell you:
    (i) That we are redetermining your eligibility for payments;
    (ii) Why we are redetermining your eligibility;
    (iii) Which disability rules we will apply;
    (iv) That our review could result in a finding that your SSI 
payments based on disability could be terminated;
    (v) That you have the right to submit medical and other evidence 
for our consideration during the redetermination; and
    (vi) That we will notify you of our determination, your right to 
appeal the determination, and your right to request continuation of 
benefits during appeal.
    (2) We will notify you in writing of the results of the disability 
redetermination. The notice will tell you what our determination is, 
the reasons for our determination, and your right to request 
reconsideration of the determination. If our determination shows that 
we should stop your SSI payments based on disability, the notice will 
also tell you of your right to request that your benefits continue 
during any appeal. Our initial disability redetermination will be 
binding unless you request a reconsideration within the stated time 
period or we revise the initial determination.
    (e) When will we find that your disability ended? If we find that 
you are not disabled, we will find that your disability ended in the 
earliest of:
    (1) The month the evidence shows that you are not disabled under 
the rules in this section, but not earlier than the month in which we 
mail you a notice saying that you are not disabled.
    (2) The first month in which you failed without good cause to 
follow prescribed treatment under the rules in Sec. 416.930.
    (3) The first month in which you failed without good cause to do 
what we asked. Section 416.1411 explains the factors we will consider 
and how we will determine generally whether you have good cause for 
failure to cooperate. In addition, Sec. 416.918 discusses how we 
determine whether you have good cause

[[Page 54790]]

for failing to attend a consultative examination.

    18. Section 416.990 is amended by revising paragraph (b)(11) to 
read as follows:


Sec. 416.990  When and how often we will conduct a continuing 
disability review.

* * * * *
    (b) * * *
    (11) By your first birthday, if you are a child whose low birth 
weight was a contributing factor material to our determination that you 
were disabled; i.e., whether we would have found you disabled if we had 
not considered your low birth weight. However, we will conduct your 
continuing disability review later if at the time of our initial 
determination that you were disabled:
    (i) We determine that you have an impairment that is not expected 
to improve by your first birthday; and
    (ii) We schedule you for a continuing disability review after your 
first birthday.
* * * * *

    19. Section 416.994a is amended by revising the last sentence of 
paragraph (b)(3)(ii), the heading and first sentence of paragraph 
(b)(3)(iii), the fourth sentence of paragraph (d), the first and second 
sentences of paragraph (e)(1), and (i)(1)(ii) and (i)(2) to read as 
follows:


Sec. 416.994a  How we will determine whether your disability continues 
or ends, and whether you are and have been receiving treatment that is 
medically necessary and available, disabled children.

* * * * *
    (b) * * *
    (3) * * *
    (ii) * * * If not, we will consider whether it functionally equals 
the listings.
    (iii) Does your impairment(s) functionally equal the listings? If 
your current impairment(s) functionally equals the listings, as 
described in Sec. 416.926a, we will find that your disability 
continues. * * *
* * * * *
    (d) * * * If not, we will determine whether an attempt should be 
made to reconstruct those portions of the missing file that were 
relevant to our most recent favorable determination or decision (e.g., 
school records, medical evidence from treating sources, and the results 
of consultative examinations). * * *
    (e) * * *
    (1) * * * Changing methodologies and advances in medical and other 
diagnostic techniques or evaluations have given rise to, and will 
continue to give rise to, improved methods for determining the causes 
of (i.e., diagnosing) and measuring and documenting the effects of 
various impairments on children and their functioning. Where, by such 
new or improved methods, substantial evidence shows that your 
impairment(s) is not as severe as was determined at the time of our 
most recent favorable decision, such evidence may serve as a basis for 
a finding that you are no longer disabled, provided that you do not 
currently have an impairment(s) that meets, medically equals, or 
functionally equals the listings, and therefore results in marked and 
severe functional limitations. * * *
* * * * *
    (i) * * *
    (1) * * *
    (ii) Psychological or psychosocial counseling; * * *
    (2) How we will consider whether medically necessary treatment is 
available. When we decide whether medically necessary treatment is 
available, we will consider such things as (but not limited to) * * *
* * * * *
[FR Doc. 00-22753 Filed 9-8-00; 8:45 am]
BILLING CODE 4191-02-P