[Federal Register Volume 72, Number 162 (Wednesday, August 22, 2007)]
[Notices]
[Pages 47045-47050]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 07-4076]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers For Medicare & Medicaid Services


Privacy Act of 1974; Report of a Modified System of Records

AGENCY: Department of Health and Human Services (HHS), Center for 
Medicare & Medicaid Services (CMS).

ACTION: Notice of a Modified System of Records (SOR).

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SUMMARY: In accordance with the requirements of the Privacy Act of 
1974, we propose to modify an existing system titled, ``National 
Emphysema Treatment Trial (NETT), System No. 09-70-0531,'' established 
at 65 Federal Register 47995 (August 4, 2000). We propose to modify 
existing routine use number 1 that permits disclosure to agency 
contractors and consultants to include disclosure to CMS grantees who 
perform a task for the agency. CMS grantees, charged with completing

[[Page 47046]]

projects or activities that require CMS data to carry out that 
activity, are classified separate from CMS contractors and/or 
consultants. The modified routine use will remain as routine use number 
1. We will delete routine use number 4 authorizing disclosure to 
support constituent requests made to a congressional representative. If 
an authorization for the disclosure has been obtained from the data 
subject, then no routine use is needed. The Privacy Act allows for 
disclosures with the ``prior written consent'' of the data subject.
    We will broaden the scope of routine uses number 5 and 6, 
authorizing disclosures to combat fraud and abuse in the Medicare and 
Medicaid programs to include combating ``waste'' which refers to 
specific beneficiary or recipient practices that result in unnecessary 
cost to all federally-funded health benefit programs. Additionally, we 
will broaden the scope of this system by including the section titled 
``Additional Circumstances Affecting Routine Use Disclosures,'' that 
addresses ``Protected Health Information (PHI)'' and ``small cell 
size.'' The requirement for compliance with HHS regulation ``Standards 
for Privacy of Individually Identifiable Health Information'' apply 
when ever the system collects or maintain PHI. This system may contain 
PHI. In addition, our policy to prohibit release if there is a 
possibility that an individual can be identified through ``small cell 
size'' will apply to the data disclosed from this system.
    We are modifying the language in the remaining routine uses to 
provide a proper explanation as to the need for the routine use and to 
provide clarity to CMS's intention to disclose individual-specific 
information contained in this system. The routine uses will then be 
prioritized and reordered according to their usage. We will also take 
the opportunity to update any sections of the system that were affected 
by the recent reorganization or because of the impact of the Medicare 
Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) 
(Pub. L. 108-173) provisions and to update language in the 
administrative sections to correspond with language used in other CMS 
SORs.
    The primary purpose of the system of records is to collect and 
maintain data that will allow CMS to provide secure data on 
participants in the randomized phase of the study, pay claims, and to 
monitor and evaluate the clinical trial. Information retrieved from 
this system of records will also be disclosed to: (1) Support 
regulatory, reimbursement and policy functions performed within the 
agency or by a contractor, consultant, or CMS grantee; (2) assist 
another Federal or state agency to enable such agency to administer a 
Federal health benefits program, or to enable such agency to fulfill a 
requirement of a Federal statute or regulation that implements a health 
benefits program funded in whole or in part with Federal funds; (3) 
support research, evaluation, or epidemiological projects related to 
the prevention of disease or disability, or the restoration or 
maintenance of health, and for payment related projects; (4) support 
litigation involving the agency; and (5) combat fraud, waste, and abuse 
in certain health benefits programs. We have provided background 
information about the new system in the Supplementary Information 
section below. Although the Privacy Act requires only that CMS provide 
an opportunity for interested persons to comment on the proposed 
routine uses, CMS invites comments on all portions of this notice. See 
EFFECTIVE DATE section for comment period.

EFFECTIVE DATE: CMS filed a modified system report with the Chair of 
the House Committee on Government Reform and Oversight, the Chair of 
the Senate Committee on Homeland Security and Governmental Affairs, and 
the Administrator, Office of Information and Regulatory Affairs, Office 
of Management and Budget (OMB) on August 10, 2007. To ensure that all 
parties have adequate time in which to comment, the modified SOR, 
including routine uses, will become effective 40 days from the 
publication of the notice, or from the date it was submitted to OMB and 
the Congress, whichever is later, unless CMS receives comments that 
require alterations to this notice.

ADDRESSES: The public should address comments to: CMS Privacy Officer, 
Division of Privacy Compliance, Enterprise Architecture and Strategy 
Group, Office of Information Services, CMS, Room N2-04-27, 7500 
Security Boulevard, Baltimore, Maryland 21244-1850. Comments received 
will be available for review at this location, by appointment, during 
regular business hours, Monday through Friday from 9 a.m.-3 p.m., 
Eastern Time zone.

FOR FURTHER INFORMATION CONTACT: Joanna Baldwin, Health Insurance 
Specialist, Division of Medical and Surgical Services, Coverage and 
Analysis Group, Office of Clinical Standards and Quality, CMS, Room C1-
10-25, 7500 Security Boulevard, Baltimore, Maryland 21244-1850. Her 
telephone number is (410) 786-7205. She can be reached by telephone at 
410-786-7205 or e-mail [email protected].

SUPPLEMENTARY INFORMATION:

I. Description of the Proposed System of Records

A. Statutory and Regulatory Basis for SOR

    The statutory authority for this system is given under the 
provisions of Section 1862(a) (1) (A) of the Social Security Act, and 
42 U.S.C. 1395, which states that Medicare must provide coverage for 
items and services that are ``reasonable and necessary for the 
diagnosis or treatment of illness or injury or to improve the 
functioning of a malformed body member.''

B. Collection and Maintenance of Data in the System

    This system will collect and maintain individually identifiable and 
other data collected on Medicare beneficiaries and providers 
participating in the study. Data will be collected from Medicare 
administrative and claims records, patient medical charts, physician 
records, and via survey instruments administered to beneficiaries and 
providers. The collected information will include, but is not limited 
to Medicare claims and eligibility data, name, address, telephone 
number, health insurance claims number, race/ethnicity, gender, date of 
birth, provider name, unique provider identification number, medical 
record number, as well as clinical, demographic, health/well-being, 
family and/or caregiver contact information, and background information 
relating to Medicare issues.

II. Agency Policies, Procedures, and Restrictions on Routine Uses

    A. The Privacy Act permits us to disclose information without an 
individual's consent if the information is to be used for a purpose 
that is compatible with the purpose(s) for which the information was 
collected. Any such disclosure of data is known as a ``routine use.'' 
The Government will only release NETT information that can be 
associated with an individual as provided for under ``Section III. 
Proposed Routine Use Disclosures of Data in the System.'' Both 
identifiable and non-identifiable data may be disclosed under a routine 
use. We will only collect the minimum personal data necessary to 
achieve the purpose of NETT.
    CMS has the following policies and procedures concerning 
disclosures of information that will be maintained in the system. 
Disclosure of information from the system will be approved only

[[Page 47047]]

to the extent necessary to accomplish the purpose of the disclosure and 
only after CMS:
    1. Determines that the use or disclosure is consistent with the 
reason that the data is being collected; e.g., to collect and maintain 
data that will allow CMS to provide secure data on participants in the 
randomized phase of the study, pay claims, and to monitor and evaluate 
the clinical trial.
    2. Determines that:
    a. The purpose for which the disclosure is to be made can only be 
accomplished if the record is provided in individually identifiable 
form;
    b. The purpose for which the disclosure is to be made is of 
sufficient importance to warrant the effect and/or risk on the privacy 
of the individual that additional exposure of the record might bring; 
and
    c. There is a strong probability that the proposed use of the data 
would in fact accomplish the stated purpose(s).
    3. Requires the information recipient to:
    a. Establish administrative, technical, and physical safeguards to 
prevent unauthorized use of disclosure of the record;
    b. Remove or destroy, at the earliest time, all patient-
identifiable information; and
    c. Agree to not use or disclose the information for any purpose 
other than the stated purpose under which the information was 
disclosed.
    4. Determines that the data are valid and reliable.

III. Proposed Routine Use Disclosures of Data in the System

    A. The Privacy Act allows us to disclose information without an 
individual's consent if the information is to be used for a purpose 
that is compatible with the purpose(s) for which the information was 
collected. Any such compatible use of data is known as a ``routine 
use.'' The proposed routine uses in this system meet the compatibility 
requirement of the Privacy Act. We are proposing to establish the 
following routine use disclosures of information maintained in the 
system:
    1. To agency contractors, consultants or CMS grantees, who have 
been engaged by the agency to assist in the performance of a service 
related to this collection and who need to have access to the records 
in order to perform the activity.
    We contemplate disclosing information under this routine use only 
in situations in which CMS may enter into a contractual or similar 
agreement with a third party to assist in accomplishing CMS function 
relating to purposes for this system.
    CMS occasionally contracts out certain of its functions when doing 
so would contribute to effective and efficient operations. CMS must be 
able to give a contractor, consultant or CMS grantees whatever 
information is necessary for the contractor or consultant to fulfill 
its duties. In these situations, safeguards are provided in the 
contract prohibiting the contractor, consultant or CMS grantees from 
using or disclosing the information for any purpose other than that 
described in the contract and requires the contractor, consultant or 
CMS grantees to return or destroy all information at the completion of 
the contract.
    2. To another Federal or state agency to:
    a. contribute to the accuracy of CMS's proper payment of Medicare 
benefits;
    b. enable such agency to administer a Federal health benefits 
program, or, as necessary, to enable such agency to fulfill a 
requirement of a Federal statute or regulation that implements a health 
benefits program funded in whole or in part with Federal funds; and/or
    c. assist Federal/state Medicaid programs within the state.
    Other Federal or state agencies, in their administration of a 
Federal health program, may require NETT information in order to 
support evaluations and monitoring of Medicare claims information of 
beneficiaries, including proper reimbursement for services provided.
    3. To an individual or organization for a research project or in 
support of an evaluation project related to the prevention of disease 
or disability, the restoration or maintenance of health, or payment 
related projects.
    The NETT data will provide for research or support of evaluation 
projects and a broader, longitudinal, national perspective of the 
status of Medicare beneficiaries. CMS anticipates that many researchers 
will have legitimate requests to use these data in projects that could 
ultimately improve the care provided to Medicare beneficiaries and the 
policies that govern their care.
    4. To the Department of Justice (DOJ), court or adjudicatory body 
when:
    a. the agency or any component thereof, or
    b. any employee of the agency in his or her official capacity, or
    c. any employee of the agency in his or her individual capacity 
where the DOJ has agreed to represent the employee, or
    d. the United States Government, is a party to litigation or has an 
interest in such litigation, and, by careful review, CMS determines 
that the records are both relevant and necessary to the litigation and 
that the use of such records by the DOJ, court or adjudicatory body is 
compatible with the purpose for which the agency collected the records.
    Whenever CMS is involved in litigation, and occasionally when 
another party is involved in litigation and CMS policies or operations 
could be affected by the outcome of the litigation, CMS would be able 
to disclose information to the DOJ, court or adjudicatory body 
involved.
    5. To a CMS contractor (including, but not necessarily limited to, 
fiscal intermediaries and carriers) that assists in the administration 
of a CMS-administered health benefits program, or to a grantee of a 
CMS-administered grant program, when disclosure is deemed reasonably 
necessary by CMS to prevent, deter, discover, detect, investigate, 
examine, prosecute, sue with respect to, defend against, correct, 
remedy, or otherwise combat fraud, waste, and abuse in such program.
    We contemplate disclosing information under this routine use only 
in situations in which CMS may enter into a contractual, grantee, 
cooperative agreement or consultant relationship with a third party to 
assist in accomplishing CMS functions relating to the purpose of 
combating fraud, waste, and abuse.
    CMS occasionally contracts out certain of its functions or makes 
grants or cooperative agreements when doing so would contribute to 
effective and efficient operations. CMS must be able to give a 
contractor, grantee, consultant or other legal agent whatever 
information is necessary for the agent to fulfill its duties. In these 
situations, safeguards are provided in the contract prohibiting the 
agent from using or disclosing the information for any purpose other 
than that described in the contract and requiring the agent to return 
or destroy all information.
    6. To another Federal agency or to an instrumentality of any 
governmental jurisdiction within or under the control of the United 
States (including any State or local governmental agency), that 
administers, or that has the authority to investigate potential fraud, 
waste, or abuse in, a health benefits program funded in whole or in 
part by Federal funds, when disclosure is deemed reasonably necessary 
by CMS to prevent, deter, discover, detect, investigate, examine, 
prosecute, sue with respect to, defend against, correct, remedy, or 
otherwise combat fraud, waste, and abuse in such programs.

[[Page 47048]]

    Other agencies may require NETT information for the purpose of 
combating fraud, waste, and abuse in such Federally-funded programs.

B. Additional Provisions Affecting Routine Use Disclosures

    To the extent this system contains Protected Health Information 
(PHI) as defined by HHS regulation ``Standards for Privacy of 
Individually Identifiable Health Information'' (45 CFR Parts 160 and 
164, Subparts A and E) 65 FR 82462 (12-28-00). Disclosures of such PHI 
that are otherwise authorized by these routine uses may only be made 
if, and as, permitted or required by the ``Standards for Privacy of 
Individually Identifiable Health Information.'' (See 45 CFR 164-512 (a) 
(1).)
    In addition, our policy will be to prohibit release even of data 
not directly identifiable, except pursuant to one of the routine uses 
or if required by law, if we determine there is a possibility that an 
individual can be identified through implicit deduction based on small 
cell sizes (instances where the patient population is so small that 
individuals could, because of the small size, use this information to 
deduce the identity of the beneficiary).

IV. Safeguards

    CMS has safeguards in place for authorized users and monitors of 
such users to ensure against unauthorized use. Personnel having access 
to the system have been trained in the Privacy Act and information 
security requirements. Employees who maintain records in this system 
are instructed not to release data until the intended recipient agrees 
to implement appropriate management, operational and technical 
safeguards sufficient to protect the confidentiality, integrity and 
availability of the information and information systems and to prevent 
unauthorized access.
    This system will conform to all applicable Federal laws and 
regulations and Federal, HHS, and CMS policies and standards as they 
relate to information security and data privacy. These laws and 
regulations may apply but are not limited to: The Privacy Act of 1974; 
the Federal Information Security Management Act of 2002; the Computer 
Fraud and Abuse Act of 1986; the Health Insurance Portability and 
Accountability Act of 1996; the E-Government Act of 2002, the Clinger-
Cohen Act of 1996; the Medicare Modernization Act of 2003, and the 
corresponding implementing regulations. OMB Circular A-130, Management 
of Federal Resources, Appendix III, Security of Federal Automated 
Information Resources also applies. Federal, HHS, and CMS policies and 
standards include but are not limited to: All pertinent National 
Institute of Standards and Technology publications; the HHS Information 
Systems Program Handbook and the CMS Information Security Handbook.

V. Effects of the Modified System of Records on Individual Rights

    CMS proposes to establish this system in accordance with the 
principles and requirements of the Privacy Act and will collect, use, 
and disseminate information only as prescribed therein. Data in this 
system will be subject to the authorized releases in accordance with 
the routine uses identified in this system of records.
    CMS will take precautionary measures to minimize the risks of 
unauthorized access to the records and the potential harm to individual 
privacy or other personal or property rights of patients whose data are 
maintained in this system. CMS will collect only that information 
necessary to perform the system's functions. In addition, CMS will make 
disclosure from the proposed system only with consent of the subject 
individual, or his/her legal representative, or in accordance with an 
applicable exception provision of the Privacy Act. CMS, therefore, does 
not anticipate an unfavorable effect on individual privacy as a result 
of information relating to individuals.

    Dated: August 7, 2007.
Charlene Frizzera,
Chief Operating Officer, Centers for Medicare & Medicaid Services.

System No.:
    09-70-0531.

System Name:
    ``National Emphysema Treatment Trial (NETT),'' HHS/CMS/OCSQ.

Security Classification:
    Level Three Privacy Act Sensitive Data.

System Location:
    CMS Data Center, 7500 Security Boulevard, North Building, First 
Floor, Baltimore, Maryland 21244-1850 and at various other contractor 
locations.

Categories of Individuals Covered By the System:
    This system will collect and maintain individually identifiable and 
other data collected on Medicare beneficiaries and providers 
participating in the study.

Categories of Records In the System:
    Data will be collected from Medicare administrative and claims 
records, patient medical charts, physician records, and via survey 
instruments administered to beneficiaries and providers. The collected 
information will include, but is not limited to Medicare claims and 
eligibility data, name, address, telephone number, health insurance 
claims number, race/ethnicity, gender, date of birth, provider name, 
unique provider identification number, medical record number, as well 
as clinical, demographic, health/well-being, family and/or caregiver 
contact information, and background information relating to Medicare 
issues.

Authority For Maintenance of the System:
    The statutory authority for this system is given under the 
provisions of Section 1862(a)(1)(A) of the Social Security Act, and 42 
U.S.C. 1395, which states that Medicare must provide coverage for items 
and services that are ``reasonable and necessary for the diagnosis or 
treatment of illness or injury or to improve the functioning of a 
malformed body member.''

Purpose(s) of the System:
    The primary purpose of the system of records is to collect and 
maintain data that will allow CMS to provide secure data on 
participants in the randomized phase of the study, pay claims, and to 
monitor and evaluate the clinical trial. Information retrieved from 
this system of records will also be disclosed to: (1) Support 
regulatory, reimbursement and policy functions performed within the 
agency or by a contractor, consultant, or CMS grantee; (2) assist 
another Federal or state agency to enable such agency to administer a 
Federal health benefits program, or to enable such agency to fulfill a 
requirement of a Federal statute or regulation that implements a health 
benefits program funded in whole or in part with Federal funds; (3) 
support research, evaluation, or epidemiological projects related to 
the prevention of disease or disability, or the restoration or 
maintenance of health, and for payment related projects; (4) support 
litigation involving the agency; and (5) combat fraud, waste, and abuse 
in certain health benefits programs.

Routine Uses of Records Maintained In the System, Including Categories 
Or Users and the Purposes of Such Uses:
    A. The Privacy Act allows us to disclose information without an 
individual's consent if the information is to be used for a purpose 
that is compatible with the purpose(s) for which the information was 
collected. Any such compatible use of data is known as a ``routine 
use.'' The proposed routine uses in this system meet the

[[Page 47049]]

compatibility requirement of the Privacy Act. We are proposing to 
establish the following routine use disclosures of information 
maintained in the system:
    1. To agency contractors, consultants or CMS grantees, who have 
been engaged by the agency to assist in the performance of a service 
related to this collection and who need to have access to the records 
in order to perform the activity.
    2. To another Federal or state agency to:
    a. contribute to the accuracy of CMS's proper payment of Medicare 
benefits;
    b. enable such agency to administer a Federal health benefits 
program, or, as necessary, to enable such agency to fulfill a 
requirement of a Federal statute or regulation that implements a health 
benefits program funded in whole or in part with Federal funds; and/or
    c. assist Federal/state Medicaid programs within the state.
    3. To an individual or organization for a research project or in 
support of an evaluation project related to the prevention of disease 
or disability, the restoration or maintenance of health, or payment 
related projects.
    4. To the Department of Justice (DOJ), court or adjudicatory body 
when:
    a. the agency or any component thereof, or
    b. any employee of the agency in his or her official capacity, or
    c. any employee of the agency in his or her individual capacity 
where the DOJ has agreed to represent the employee, or
    d. the United States Government, is a party to litigation or has an 
interest in such litigation, and, by careful review, CMS determines 
that the records are both relevant and necessary to the litigation and 
that the use of such records by the DOJ, court or adjudicatory body is 
compatible with the purpose for which the agency collected the records.
    5. To a CMS contractor (including, but not necessarily limited to, 
fiscal intermediaries and carriers) that assists in the administration 
of a CMS-administered health benefits program, or to a grantee of a 
CMS-administered grant program, when disclosure is deemed reasonably 
necessary by CMS to prevent, deter, discover, detect, investigate, 
examine, prosecute, sue with respect to, defend against, correct, 
remedy, or otherwise combat fraud, waste, and abuse in such program.
    6. To another Federal agency or to an instrumentality of any 
governmental jurisdiction within or under the control of the United 
States (including any State or local governmental agency), that 
administers, or that has the authority to investigate potential fraud 
or abuse in, a health benefits program funded in whole or in part by 
Federal funds, when disclosure is deemed reasonably necessary by CMS to 
prevent, deter, discover, detect, investigate, examine, prosecute, sue 
with respect to, defend against, correct, remedy, or otherwise combat 
fraud, waste, and abuse in such programs.
    B. Additional Provisions Affecting Routine Use Disclosures
    To the extent this system contains Protected Health Information 
(PHI) as defined by HHS regulation ``Standards for Privacy of 
Individually Identifiable Health Information'' (45 CFR Parts 160 and 
164, Subparts A and E) 65 FR 82462 (12-28-00). Disclosures of such PHI 
that are otherwise authorized by these routine uses may only be made 
if, and as, permitted or required by the ``Standards for Privacy of 
Individually Identifiable Health Information.'' (See 45 CFR 164-512 (a) 
(1).)
    In addition, our policy will be to prohibit release even of data 
not directly identifiable, except pursuant to one of the routine uses 
or if required by law, if we determine there is a possibility that an 
individual can be identified through implicit deduction based on small 
cell sizes (instances where the patient population is so small that 
individuals could, because of the small size, use this information to 
deduce the identity of the beneficiary).

Policies and Practices for Storing, Retrieving, Accessing, Retaining, 
and Disposing of Records in the System:
Storage:
    All records are stored on electronic media.

Retrievability:
    The collected data are retrieved by an individual identifier; e.g., 
beneficiary name or HICN, and unique provider identification number.

Safeguards:
    CMS has safeguards in place for authorized users and monitors such 
users to ensure against unauthorized use. Personnel having access to 
the system have been trained in the Privacy Act and information 
security requirements. Employees who maintain records in this system 
are instructed not to release data until the intended recipient agrees 
to implement appropriate management, operational and technical 
safeguards sufficient to protect the confidentiality, integrity and 
availability of the information and information systems and to prevent 
unauthorized access.
    This system will conform to all applicable Federal laws and 
regulations and Federal, HHS, and CMS policies and standards as they 
relate to information security and data privacy. These laws and 
regulations may apply but are not limited to: The Privacy Act of 1974; 
the Federal Information Security Management Act of 2002; the Computer 
Fraud and Abuse Act of 1986; the Health Insurance Portability and 
Accountability Act of 1996; the E-Government Act of 2002, the Clinger-
Cohen Act of 1996; the Medicare Modernization Act of 2003, and the 
corresponding implementing regulations. OMB Circular A-130, Management 
of Federal Resources, Appendix III, Security of Federal Automated 
Information Resources also applies. Federal, HHS, and CMS policies and 
standards include but are not limited to: All pertinent National 
Institute of Standards and Technology publications; the HHS Information 
Systems Program Handbook and the CMS Information Security Handbook.

Retention and Disposal:
    CMS will retain information for a total period not to exceed 25 
years. All claims-related records are encompassed by the document 
preservation order and will be retained until notification is received 
from DOJ.

System Manager and Address:
    Director, Division of Medical and Surgical Services, Coverage and 
Analysis Group, Office of Clinical Standards and Quality, CMS, Room C4-
10-10, 7500 Security Boulevard, Baltimore, Maryland 21244-1850.

Notification Procedure:
    For purpose of access, the subject individual should write to the 
system manager who will require the system name, employee 
identification number, tax identification number, national provider 
number, and for verification purposes, the subject individual's name 
(woman's maiden name, if applicable), HICN, and/or SSN (furnishing the 
SSN is voluntary, but it may make searching for a record easier and 
prevent delay).

Record Access Procedure:
    For purpose of access, use the same procedures outlined in 
Notification Procedures above. Requestors should also reasonably 
specify the record contents being sought. (These procedures are in 
accordance with Department regulation 45 CFR 5b.5 (a) (2).)

Contesting Record Procedures:
    The subject individual should contact the system manager named 
above, and reasonably identify the record and specify the information 
to be contested.

[[Page 47050]]

State the corrective action sought and the reasons for the correction 
with supporting justification. (These procedures are in accordance with 
Department regulation 45 CFR 5b.7.)

Records Source Categories:
    The data collected and maintained in this system are retrieved from 
Medicare enrollment records, Medicare beneficiaries or proxies, and 
medical providers (such as physicians, medical facilities, home health 
care providers) for a sample of enrollees.

Systems Exempted From Certain Provisions of the Act:
    None.

[FR Doc. 07-4076 Filed 8-21-07; 8:45 am]
BILLING CODE 4120-03-P