[Federal Register Volume 66, Number 26 (Wednesday, February 7, 2001)]
[Notices]
[Pages 9406-9408]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 01-3132]


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SOCIAL SECURITY ADMINISTRATION


Supplemental Security Income for the Aged, Blind and Disabled 
(SSI) Program Demonstration Project; Treatment of Cash Received and 
Conserved To Pay for Medical or Social Services

AGENCY: Social Security Administration (SSA).

ACTION: Notice.

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SUMMARY: The Commissioner of Social Security is extending the 
application of an existing SSA demonstration project which tests how 
certain altered resources counting rules might apply in the SSI 
program. The SSI program is authorized by title XVI of the Social 
Security Act (the Act). The rules to be tested apply to the treatment 
of cash received and conserved to pay for medical or social services.
    Cash received to pay for medical or social services is not counted 
as income to the beneficiary when received. Conserved cash received for 
medical or social services (which is not a reimbursement for these 
services already paid for by the beneficiary) is not counted as a 
resource for the calendar month after the month of receipt, so long as 
it remains separately identifiable from other resources. Beginning with 
the second calendar month following the month of receipt, cash received 
for the payment of medical or social services becomes a countable 
resource used in the determination of SSI eligibility.
    On November 2, 1998, the Commissioner of Social Security published 
a Notice in the Federal Register (63 FR 58802), which waives the rules 
for counting as resources conserved cash received for medical or social 
services for Cash and Counseling demonstration participants for five 
years. All participants in Arkansas, Florida and New Jersey who are 
members of a test group receive personal assistance services. Personal 
assistance services are help with the basic activities of daily living, 
including bathing, dressing, transferring, toileting, and eating, and/
or instrumental activities of daily living such as housekeeping, meal 
preparation, shopping, laundry, money management and medication 
management. Consumers of personal assistance services who participate 
in the demonstration are empowered by purchasing the services they 
require (including medical and social services) to perform the 
activities of daily living. In order to accomplish the objective of the 
demonstration project, cash allowances and information services are 
provided directly to persons with disabilities to enable them to choose 
and purchase services from providers that they feel would best meet 
their needs. Participants are also free to engage a fiscal intermediary 
to assist with proper disbursement of these cash allowances.
    This Notice extends the temporary resources counting rules for Cash 
and Counseling participants to participants in Oregon's similar 
Independent Choices demonstration project. All participants in the 
Independent Choices demonstration project are consumers of personal 
assistance services.
    Medicaid is the predominant source of public financing for personal 
assistance services programs for the aged, blind and disabled. The 
Secretary of the Department of Health and Human Services (DHHS) will 
exercise her authority under section 1115 of the Act to waive certain 
Medicaid provisions to permit the State of Oregon to exercise its 
Independent Choices demonstration. Medicaid beneficiaries who 
participate in this demonstration will be given cash to purchase the 
services they need from traditional and nontraditional providers, as 
they deem appropriate. Assistance will be available to help these 
beneficiaries effectively use funds allotted for personal assistance 
services.
    Many of the Medicaid beneficiaries who will participate in the 
Independent Choices demonstration are SSI beneficiaries or belong to 
coverage groups using eligibility methodologies related to those of the 
SSI program under title XIX of the Act. Under the Cash and Counseling 
demonstration project, the Commissioner of Social Security is testing 
the appropriateness of current SSI rules which require counting cash 
received for the purchase of medical or social services as resources if 
retained for more than one month after the month of receipt. This 
extension of the waiver of these SSI resources counting rules will help 
SSA obtain a larger test group of beneficiaries making provider hiring 
and payment decisions without a fiscal intermediary. Oregon will 
encourage participants to make their own fiscal decisions about 
providers. SSA will use these additional data for the evaluation of its 
policies on excluding cash received to purchase medical or social 
services. This SSA test will also assist the Secretary of DHHS in 
testing the possibility of providing greater autonomy to the consumers 
of personal assistance services by empowering them to purchase the 
services they require (including medical and social services) to 
perform their activities of daily living. In order to do so, the 
Commissioner has exercised his authority under section 1110(b) of the 
Act and waived SSI resources counting of cash received and conserved 
for future purchases of medical and social services.
    The extension of this waiver of SSI resources counting rules will 
apply to participants in Oregon's Independent Choices demonstration 
project for the duration of their participation. Cash provided to 
participants for purchase of medical or social services must be 
conserved in a form that is separately identifiable from other 
resources that may be countable or excludable under title XVI of the 
Act. The cash received for medical or social services and conserved 
towards payment for those services by SSI beneficiaries who participate 
in this demonstration will not be included in SSI countable resources 
only for so long as the individual continues to participate in the 
Independent Choices demonstration project.
    Existing SSI resource-counting rules are suspended only where 
application of such rules would adversely affect participation by SSI 
beneficiaries in the Independent Choices demonstration project.

[[Page 9407]]

    This notice is published in accordance with the requirement in 20 
CFR 416.250(e).

EFFECTIVE DATES: This project will be effective for the period 
authorized by the Secretary of DHHS for Oregon's Independent Choices 
demonstration project. The date anticipated by the Secretary for the 
Independent Choices demonstration to begin is on or after January 1, 
2001. According to the demonstration's plan, beneficiaries may 
participate throughout the period of the demonstration, up to five 
years. Thus, if the demonstration begins on January 2, 2001, the 
anticipated ending date for all participants will be no later than 
December 31, 2005.
    Any cash for medical or social services received after an SSI 
beneficiary's participation in the demonstration has ended which has 
been conserved for more than one month will be counted as resources. 
Any cash for medical or social services that is received during 
participation in the demonstration and conserved subsequent to 
participation in the demonstration will be subject to regular SSI 
resources rules.

FOR FURTHER INFORMATION CONTACT: Craig Streett, Office of Program 
Benefits, 3-M-1 Operations Building, 6401 Security Boulevard, 
Baltimore, MD 21235-0001, (410) 965-9793, or through the Internet at 
[email protected].

SUPPLEMENTARY INFORMATION: Section 1612(a) of the Act defines what is 
income for purposes of the SSI program; section 1612(b) of the Act 
specifies exclusions from income. As explained in the regulation 
located at 20 CFR 416.1102, income counted for the purposes of the SSI 
program includes anything an individual receives in cash or in kind 
that can be used to meet basic needs, such as food and shelter. 
Regulations at 20 CFR 416.1103(a)(3) and (b)(1) explain that assistance 
provided in cash or in kind under a Federal, State, or local government 
program whose purpose is to provide medical care or services or social 
services, including vocational rehabilitation, is not income. Cash 
provided by any nongovernmental medical care or medical services 
program or under a health insurance policy or by a nongovernmental 
social services program (except cash to cover food, clothing or 
shelter) is not income if it is either repayment for program-approved 
services for which the individual has already paid or a payment 
restricted to the future purchase of a program-approved service. This 
is explained by regulations at 20 CFR 416.1103(a)(5) and (b)(3).
    As explained in regulations at 20 CFR 416.1201(a), resources are 
cash or other liquid assets or any real or personal property that an 
individual (or spouse) owns and could convert to cash to be used for 
support and maintenance. Regulations at 20 CFR 416.1207(d) explain that 
items received in cash or in kind during a month are evaluated first 
under the income counting rules. If they are retained until the first 
moment of the following month, they then are subject to the rules for 
counting resources.
    Section 1613 of the Act addresses the exclusions from resources for 
purposes of the SSI program. Regulations at 20 CFR 416.1201(a)(3) also 
explain the temporary exclusion from resources for most conserved cash 
received for medical or social services that is separately identifiable 
from other resources. Cash received for medical or social services that 
is retained after the temporary exclusion period is a countable 
resource whether or not it is separately identifiable from other 
resources.
    SSI regulations recognize that cash payments made specifically to 
enable people to pay for medical or social services are not income for 
SSI purposes, because they are assumed not to be available for support 
and maintenance. Those regulations recognize that the recipient is not 
always able to use the cash for payment for medical or social services 
in the month of receipt. Therefore, SSI regulations provide for not 
counting as resources any cash received to pay for medical and social 
services which is retained one full calendar month following the month 
of receipt, so long as it is separately identifiable from other 
resources. The rule permitting not counting such cash as resources does 
not encompass cash received as reimbursement for medical or social 
service bills the individual has already paid. Counting conserved cash 
as resources if retained after the month following the month of receipt 
is consistent with the purpose of the SSI program, which is to meet the 
current needs of beneficiaries such as the needs for food and shelter.
    The Independent Choices demonstration project is designed to 
provide greater autonomy to the consumers of personal assistance 
services by empowering them to purchase the services they require 
(including medical and social services) to perform their activities of 
daily living. In order to accomplish the objectives of the 
demonstration project, cash allowances and information services will be 
provided directly to persons with disabilities to enable them to choose 
and purchase services from providers that they feel would best meet 
their needs.
    Many of the consumers of personal assistance services are SSI 
beneficiaries. Under current SSI regulations, some SSI beneficiaries 
would not be able to participate in the Independent Choices 
demonstration project without risk to their continuing SSI eligibility 
due to the possibility that participants may receive cash to be 
conserved towards the future purchase of services. Section 1110(b) of 
the Act grants the Commissioner authority to waive certain 
requirements, conditions, or limitations of title XVI of the Act 
necessary to conduct experimental, pilot or demonstration projects. 
Unless the Commissioner exercises this authority, the remainder of cash 
received for future purchases of services by SSI beneficiaries who 
choose to participate in the demonstration will become countable 
resources two months following the month of receipt.
    The consent of an SSI beneficiary to participate in this 
demonstration project is required under section 1110(b) of the Act. 
Oregon will obtain written consent from every participant who is an SSI 
beneficiary. That consent will stipulate that his or her participation 
is voluntary, and that he or she can revoke participation at any time. 
SSA will waive existing SSI rules for counting conserved cash received 
for the purchase of medical or social services as resources only where 
the application of existing rules would adversely affect the 
individual's SSI eligibility. Accordingly, an individual's 
participation in the Independent Choices project will not affect 
participants' eligibility for SSI or benefit amounts.
    The objectives of SSA in conducting this demonstration project are 
to:
     Test the appropriateness of current SSI rules which 
require counting cash received for the purchase of medical or social 
services as resources if retained for more than one month after the 
month of receipt;
     Test alternative SSI rules for counting conserved cash 
received for the purchase of medical or social services when 
beneficiaries make their own provider hiring and payment decisions 
without a fiscal intermediary;
     Facilitate the ability of the Secretary, DHHS and the 
State of Oregon to engage in the Independent Choices demonstration 
project;
     Permit the Secretary, DHHS, and the State of Oregon to 
determine if cost savings can be realized from the Independent Choices 
demonstration project; and

[[Page 9408]]

     Empower participants in the Independent Choices 
demonstration project to demonstrate greater autonomy by allowing them 
to purchase their own personal assistance services.
    The Secretary, DHHS and the State of Oregon will obtain 
measurements involving these objectives for the Social Security 
Administration.
    The Commissioner's demonstration project will involve no or minimal 
new or additional program costs to the Federal government under title 
XVI of the Act or to the State of Oregon under section 1616 of the Act. 
SSI beneficiaries who choose to participate in this demonstration will 
purchase services which would ordinarily be provided by Medicaid and 
other Federal and State services programs at a potentially greater 
cost. If the Commissioner did not exercise his authority under section 
1110(b) of the Act to waive certain resources rules for participants in 
the Independent Choices demonstration, SSI beneficiaries could choose 
not to participate in Oregon's demonstration and continue to receive 
services directly, rather than through the beneficiary's purchase. 
Continued SSI eligibility for beneficiaries who choose to participate 
in the demonstration project is not a new or additional cost related to 
the Commissioner's demonstration project.
    SSI beneficiary participation in the Independent Choices 
demonstration should not affect SSI benefit amounts even if the 
beneficiary employs an ineligible spouse or ineligible parent as a 
provider of services, unless the beneficiary is an alien who employs 
the sponsor to provide these services. Generally, the income and 
resources of an eligible spouse or eligible child is deemed to include 
a portion of the income and resources of the ineligible spouse or 
parent under sections 1614(f)(1) and (2) of the Act. However, the 
Commissioner has exercised his discretion under those provisions. As a 
result, SSA does not deem the income of an ineligible spouse or 
ineligible parent paid under a Federal, State or local government 
program who provides an eligible spouse or eligible child with chore, 
attendant or homemaker services (described in regulations at 20 CFR 
416.1161(a)(16)). The Commissioner has no similar discretionary 
authority for deeming from a sponsor to an alien.
    If an SSI beneficiary employs his or her ineligible spouse or 
ineligible parent as a service provider, and the ineligible spouse or 
parent conserves all or part of those funds, the retained portion of 
those funds will become deemable resources the month after the month of 
receipt. (This is described in regulations at 20 CFR 416.1202.) SSA 
routinely explains the SSI resources limits and the rules concerning 
the deeming of resources to affected SSI beneficiaries. Instructions to 
SSA field offices in Oregon will reinforce the need to explain how 
payment to the ineligible spouse or ineligible parent could lead to an 
increase in deemable resources.
    The State of Oregon will experience no or minimal new or additional 
costs under section 1616 of the Act for SSI beneficiaries who 
participate in the Independent Choices demonstration project. The 
demonstration project will not add new beneficiaries to either the SSI 
or State supplementary payments rolls, or artificially extend the 
eligibility of beneficiaries, or increase payment amounts of SSI or 
State supplementary payments to participants.
    Statutory and Regulatory Provisions Waived: The Commissioner waives 
certain SSI resources counting rules for the duration of an 
individual's participation in Oregon's Independent Choices 
demonstration project where application of those rules would otherwise 
affect the eligibility of an individual for SSI. The specific statutory 
and regulatory provisions waived are those described in the preceding 
section.

    Authority: Section 1110(b) of the Social Security Act.

(Catalog of Federal Domestic Assistance Programs No. 96.006-
Supplemental Security Income)

    Dated: January 18, 2001.
Kenneth S. Apfel,
Commissioner of Social Security.
[FR Doc. 01-3132 Filed 2-6-01; 8:45 am]
BILLING CODE 4191-02-P