[Federal Register Volume 70, Number 58 (Monday, March 28, 2005)]
[Rules and Regulations]
[Pages 15590-15592]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-5973]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 3

RIN 2900-AM14


Exclusions From Income and Net Worth Computations

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends the Department of Veterans Affairs (VA) 
adjudication regulations to exclude from income and net worth 
computations in the pension and parents' dependency and indemnity 
compensation programs benefits or payments received pursuant to the 
Medicare Prescription Drug Discount Card and Transitional Assistance 
Program in the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003. This amendment is necessary to conform the 
regulations to statutory provisions.

DATES: Effective date: March 28, 2005.

FOR FURTHER INFORMATION CONTACT: Maya Ferrandino, Consultant (211A), 
Compensation and Pension Service, Policy and Regulations Staff, 
Veterans Benefits Administration, 810 Vermont Avenue, NW., Washington, 
DC 20420, (202) 273-7232.

SUPPLEMENTARY INFORMATION: All income is countable when VA determines 
entitlement to income-based benefits unless specifically excluded by 
law. Section 101 of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003 (MMA), Public Law 108-173, added section 
1860D-31 to the Social Security Act (42 U.S.C. 1395w-141), creating a 
Medicare prescription drug discount card and transitional assistance 
program. This program allows Medicare beneficiaries to pool their 
purchasing power to secure substantial discounts on their medicines. 
Medicare beneficiaries at or below 135 percent of the federal poverty 
level can qualify for $600 in additional assistance for the remainder 
of 2004 and another $600 in 2005. The drug discounts and $600 in 
transitional assistance became available on June 1, 2004.
    A provision of the MMA clarifies the potential interaction between 
the drug discount card and transitional assistance and VA's pension and 
parents dependency and indemnity compensation benefits by stating that, 
``[t]he availability of negotiated prices or transitional assistance 
under this Section shall not be treated as benefits or otherwise taken 
into account in determining an individual's eligibility for, or the 
amount of benefits under, any other Federal program.'' Section 1860D-
31(g)(6) of the Social Security Act. Therefore, the transitional 
assistance program and any savings associated with the prescription 
drug discount card are not income or net worth for VA purposes. This 
document amends 38 CFR 3.261, 3.262, 3.263, 3.272, and 3.275 to reflect 
this statutory change.
    This final rule merely restates statutory provisions. Accordingly, 
there is a basis for dispensing with prior notice and comment and the 
delayed effective date provisions of 5 U.S.C. 552 and 553.

Paperwork Reduction Act

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3521).

[[Page 15591]]

Regulatory Flexibility Act

    Because no notice of proposed rulemaking was required in connection 
with the adoption of this final rule, no regulatory flexibility 
analysis is required under the Regulatory Flexibility Act (5 U.S.C. 
601-612). Even so, the Secretary hereby certifies that this regulatory 
amendment will not have a significant economic impact on a substantial 
number of small entities as they are defined in the Regulatory 
Flexibility Act.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before developing any rule that may result in an expenditure 
by State, local, or tribal governments, in the aggregate, or by the 
private sector, of $100 million or more (adjusted annually for 
inflation) in any given year. This rule would have no such effect on 
State, local, or tribal governments, or the private sector.

Catalog of Federal Domestic Assistance Numbers

    The Catalog of Federal Domestic Assistance program numbers for this 
proposal are 64.104, 64.105, and 64.110.

List of Subjects in 38 CFR Part 3

    Administrative practice and procedure, Claims, Disability benefits, 
Health care, Pensions, Veterans, Vietnam.

    Approved: February 10, 2005.
Gordon H. Mansfield,
Deputy Secretary of Veterans Affairs.

0
For the reasons set forth in the preamble, 38 CFR part 3 is amended as 
follows:

PART 3--ADJUDICATION

Subpart A--Pension, Compensation, and Dependency and Indemnity 
Compensation

0
1. The authority citation for part 3, subpart A continues to read as 
follows:

    Authority: 38 U.S.C. 501(a), unless otherwise noted.


0
2. In Sec.  3.261, paragraph (a) is amended by adding entry (42) at the 
end of the table to read as follows:


Sec.  3.261  Character of income; exclusions and estates.

* * * * *
    (a) * * *

--------------------------------------------------------------------------------------------------------------------------------------------------------
                                                                 Dependency and         Pension; old-law     Pension; section 306
               Income                 Dependency (parents)   indemnity compensation   (veterans, surviving   (veterans, surviving           See-
                                                                    (parents)        spouses and children)  spouses and children)
--------------------------------------------------------------------------------------------------------------------------------------------------------
 
                                                                      * * * * * * *
(42) Income received under the       Excluded..............  Excluded..............  Excluded.............  Excluded.............  Sec.   3.262 (aa)
 Medicare prescription drug
 discount card and transitional
 assistance program (42 U.S.C.
 1395w-141(g)(6)).
--------------------------------------------------------------------------------------------------------------------------------------------------------


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3. Section 3.262 is amended by:
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a. Adding paragraph (aa) immediately following the first authority 
citation at the end of paragraph (z); and
0
b. Removing the second authority citation at the end of the section.
    The addition reads as follows:


Sec.  3.262  Evaluation of income.

* * * * *
    (aa) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. For purposes of old law pension, section 306 
pension, and parents' dependency and indemnity compensation, the 
payments received under the Medicare transitional assistance program 
and any savings associated with the Medicare prescription drug discount 
card will not be considered income.

(Authority: 42 U.S.C. 1395w-141(g)(6))



0
4. Section 3.263 is amended by:
0
a. Adding an authority citation at the end of paragraph (f).
0
b. Adding paragraph (i) immediately following the first authority 
citation at the end of paragraph (h).
0
c. Removing the second authority citation at the end of section.
    The additions read as follows:


Sec.  3.263  Corpus of estate; net worth.

* * * * *
    (f) * * *

(Authority: Sec. 105, Pub. L. 100-383; 102 Stat. 905; Sec. 6. Pub. 
L. 102-371; 106 Stat. 1167, 1168)

* * * * *
    (i) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. There shall be excluded from the corpus of estate 
or net worth of a claimant payments received under the Medicare 
transitional assistance program and any savings associated with the 
Medicare prescription drug discount card.

(Authority: 42 U.S.C. 1395w-141(g)(6))



0
5. Section 3.272 is amended by:
0
a. Revising the authority citation at the end of paragraph (u).
0
b. Adding paragraph (w) immediately following the first authority 
citation at the end of paragraph (v).
0
c. Removing the second authority citation at the end of the section.
    The revision and addition read as follows:


Sec.  3.272  Exclusions from income.

* * * * *
    (u) * * *

(Authority: 38 U.S.C. 1833(c))


* * * * *
    (w) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. The payments received under the Medicare 
transitional assistance program and any savings associated with the 
Medicare prescription drug discount card.

(Authority: 42 U.S.C. 1395w-141(g)(6))


0
6. Section 3.275 is amended by:
0
a. Revising the authority citation for paragraph (i).
0
b. Adding paragraph (k) immediately following the first authority 
citation at the end of paragraph (j).
0
c. Removing the second authority citation at the end of the section.
    The revision and addition read as follows:


Sec.  3.275  Criteria for evaluating net worth.

* * * * *
    (i) * * *

(Authority: 38 U.S.C. 1833(c))


* * * * *
    (k) Medicare Prescription Drug Discount Card and Transitional 
Assistance Program. There shall be excluded from the corpus of estate 
or

[[Page 15592]]

net worth of a claimant payments received under the Medicare 
transitional assistance program and any savings associated with the 
Medicare prescription drug discount card.

(Authority: 42 U.S.C. 1395w-141(g)(6))


[FR Doc. 05-5973 Filed 3-25-05; 8:45 am]
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