[Federal Register Volume 73, Number 170 (Tuesday, September 2, 2008)]
[Notices]
[Pages 51302-51305]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-20225]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Office of the Secretary


Office of the Assistant Secretary for Planning and Evaluation; 
State Long-Term Care Partnership Program: State Reciprocity Standard

AGENCY: Office of the Assistant Secretary for Planning and Evaluation 
(OASPE), HHS.

[[Page 51303]]


ACTION: Notice with Comment Period.

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SUMMARY: Under section 6021 of Public Law 109-171, the Deficit 
Reduction Act of 2005 (DRA), States may provide asset disregards (and 
related estate recovery offsets) for Medicaid applicants who receive 
benefits under qualified long term care insurance policies (Partnership 
policies) that were purchased in the same State. This notice sets forth 
standards for states that choose to enter into a reciprocity agreement 
under section 6021(b) of the DRA, under which they agree to provide the 
same disregards and offsets for qualified Partnership policies that a 
Medicaid applicant purchased in another State that participates in the 
reciprocity agreement.

DATES: To be assured consideration, comments must be received at the 
address provided below, no later than 5 p.m. on November 3, 2008.

ADDRESSES: In commenting, please refer to file code ASPE-PLTC. Because 
of staff and resource limitations, we cannot accept comments by 
facsimile (FAX) transmission.
    You may submit comments in one of four ways (no duplicates, 
please):
    1. Electronically. You may submit electronic comments on specific 
issues in this notice to http://www.Regulations.gov. Click on the link 
``Comment or Submission'' and enter the keyword ``PLTC-RS''. 
(Attachments should be in Microsoft Word, WordPerfect, or Excel; 
however, we prefer Microsoft Word.)
    2. By regular mail. You may mail written comments (one original and 
two copies) to the following address ONLY: Office of Disability, Aging, 
and Long-Term Care, Office of the Assistant Secretary for Planning and 
Evaluation, Department of Health and Human Services, Attention: PLTC-
RS, Hunter McKay, 200 Independence Avenue, SW., Room 424-E, Washington, 
DC 20201.
    Please allow sufficient time for mailed comments to be received 
before the close of the comment period.
    3. By express or overnight mail. You may send written comments (one 
original and two copies) to the following address only: Office of 
Disability, Aging, and Long-Term Care, Office of the Assistant 
Secretary for Planning and Evaluation, Department of Health and Human 
Services, Attention: PLTC-RS, Hunter McKay, 200 Independence Avenue, 
SW., Room 424-E, Washington, DC 20201.
    4. By hand or courier. If you prefer, you may deliver (by hand or 
courier) your written comments (one original and two copies) before the 
close of the comment period to the following address: Room 424-E, 
Hubert H. Humphrey Building, 200 Independence Avenue, SW., Washington, 
DC 20201.
    (Because access to the interior of the Hubert H. Humphrey Building 
is not readily available to persons without Federal Government 
identification, commenters are encouraged to leave their comments in 
the mail drop slots located in the main lobby of the building. A stamp-
in clock is available for persons wishing to retain proof of filing by 
stamping in and retaining an extra copy of the comments being filed.)
    Comments mailed to the addresses indicated as appropriate for hand 
or courier delivery may be delayed and received after the comment 
period.
    Submitting Comments: We welcome comments from the public on all 
issues set forth in this notice to assist us in fully considering 
issues and developing policies. You can assist us by referencing the 
file code PLTC-RS and the specific ``issue identifier'' that precedes 
the section on which you choose to comment.
    Inspection of Public Comments: All comments received before the 
close of the comment period are available for viewing by the public, 
including any personally identifiable or confidential business 
information that is included in a comment. We post all comments 
received before the close of the comment period on the following Web 
site as soon as possible after they have been received: http://www.Regulations.gov. Click on the link ``Comment or Submission'' on 
that Web site to view public comments.
    Comments received timely will also be available for public 
inspection as they are received, generally beginning approximately 3 
weeks after publication of a document, at the headquarters of the 
Department of Health and Human Services, 200 Independence Avenue, SW., 
Washington, DC, 20201, Monday through Friday of each week from 8:30 
a.m. to 4 p.m.
    The Department of Health and Human Services will also post 
communications from stake-holders, as they gain experience with the 
program, on the web-site for the Office of the Assistant Secretary for 
Planning and Evaluation: http://aspe.os.dhhs.gov/_/index.cfm.

Electronic Access

    This Federal Register document is also available from the Federal 
Register online database through GPO Access, a service of the U.S. 
Government Printing Office. Free public access is available on a Wide 
Area Information Server (WAIS) through the Internet and via 
asynchronous dial-in. Internet users can access the database by using 
the World Wide Web; the Superintendent of Documents' home page address 
is http://www.gpoaccess.gov/, by using local WAIS client software, or 
by telnet to swais.access.gpo.gov, then login as guest (no password 
required). Dial-in users should use communications software and modem 
to call (202) 512-1661; type swais, then login as guest (no password 
required).

FOR FURTHER INFORMATION CONTACT: Hunter McKay, (202) 205-8999.

SUPPLEMENTARY INFORMATION:

I. Legislative Background

    Medicaid is a joint Federal/State program established pursuant to 
title XIX of the Social Security Act. State Medicaid programs under 
title XIX generally cover medical and long-term care costs for certain 
people with limited income and resources, pursuant to ``State Plans'' 
approved by the Secretary of Health and Human Services (``the 
Secretary''). In general, individuals must have assets below a 
specified level in order to be eligible for Medicaid. Under certain 
circumstances, when a State calculates an applicant's assets for 
purposes of determining Medicaid eligibility, the statute permits the 
State to disregard an amount equal to benefits paid to or on behalf of 
the individual under a qualifying long-term care insurance policy 
purchased in the same State. The statute also allows States to exempt 
benefits paid under the policy from Medicaid estate recovery after the 
insured's death.
    A State that wishes to apply this asset disregard must submit a 
Medicaid State Plan Amendment (SPA) for approval by the Secretary. The 
SPA creates a ``Long-Term Care Partnership'' (``Partnership'') and the 
long-term care policies that qualify for the asset disregard are 
referred to here as ``Partnership policies.'' States that have an 
approved SPA are referred to as ``Partnership States.''
    There are two types of Partnership States: those that had SPAs 
approved before May 14, 1993 (referred to here as ``Original'' 
Partnership States) and those that have submitted SPAs pursuant to 
section 6021 of the DRA (referred to here as ``DRA'' Partnership 
States).
    Section 6021(b) of the DRA directs the Secretary to develop 
standards for Partnership States that wish to provide reciprocal 
disregards for Medicaid applicants who have purchased a qualified 
Partnership policy in another Partnership State. Section 6021(b) 
further provides that these standards must contain the following 
provisions:

[[Page 51304]]

     Benefits paid under such Partnership policies will be 
treated the same by all such States; and
     States with Partnership Programs established under the DRA 
shall be subject to these standards unless the State notifies the 
Secretary in writing of the State's election to be exempt

II. Reciprocity Standards in the Provision of a Medicaid Asset 
Disregard For Eligibility Determination and Estate Recovery

    DRA Partnership States that have not elected (under section V, 
below) to be exempt from the reciprocity standards described below, and 
Original Partnership States that have elected to adopt such reciprocity 
standards (as described in Section VI below), are referred to here as 
``Participating States.'' Each Participating State agrees as follows:
    1. Any individual who has purchased a Partnership policy in any 
Participating State; who has received benefits under the policy; and 
who applies for Medicaid in a Participating State other than the one in 
which the policy was issued, will receive an asset disregard in an 
amount equal (dollar for dollar) to the benefits received under the 
policy;
    2. The asset disregard procedure and calculation will be the same 
for every individual with a Partnership policy that applies for 
Medicaid in the Participating State, without regard to whether the 
policy was purchased in another State, or the date the policy was 
purchased;
    3. An amount equal to the benefits received under the Partnership 
policy will be exempt from Medicaid estate recovery provisions; and,
    4. If a person moves from the State in which his or her Partnership 
policy was issued; later applies for Medicaid in another Participating 
State; and is determined to be eligible using a Partnership asset 
disregard, the Partnership asset disregard will not be revoked upon 
eligibility re-determination should the State subsequently decide to 
become exempt from the reciprocity agreement.

III. Other State Medicaid Eligibility Provisions Not Affected

    These reciprocity standards only apply to the asset disregard 
described in Section II, above. Individuals who have received benefits 
under a Partnership policy, and qualify for an asset disregard, must 
meet all other Medicaid eligibility requirements in the State in which 
they are applying for Medicaid coverage. These may include requirements 
that relate to the Partnership policy, but only if those requirements 
do not affect the asset disregard.

    Example: Some Partnership States may require Medicaid applicants 
holding Partnership policies to exhaust all of the benefits under 
the policy before becoming eligible for Medicaid. Other Partnership 
States may allow applicants to apply for Medicaid coverage (and 
receive dollar for dollar asset disregard) even if residual benefits 
remain in the policy.

IV. Effective Date

    These reciprocity standards will become effective on January 1, 
2009.

V. Deemed Participation of States With Partnership Programs Established 
Under the DRA

    As required by the statute, all DRA Partnership States will be 
deemed to be participating in the reciprocity agreement unless they 
elect to be exempt from the reciprocity standards by notifying the 
Secretary, in writing, of their election.
    All States with State Plan Amendments effective dates prior to 
January 1, 2009, will be deemed to be participating in the reciprocity 
standards unless, prior to the effective date of these standards, the 
State elects exemption from the standards through a new SPA.
    States with State Plan Amendment effective dates after January 1, 
2009 will also be deemed to be participating in the reciprocity 
standards unless they elect exemption through a SPA.

VI. Participation by States Operating a Partnership Under the Authority 
of a State Plan Amendment Approved Prior to May 14, 1993

    States with State Plan Amendments approved prior to May 14, 1993 
may elect to adopt these reciprocity standards, and participate with 
those States operating a Partnership under the authority of the DRA. To 
do so, those States must submit a new SPA to that effect. Such States 
must agree to accept all of the reciprocity standards with respect to 
all other Participating States.

VII. Effect of Reciprocity Exemption

    In order for a Medicaid applicant to be eligible for the asset 
disregard, both the State in which the individual is applying, and the 
State in which the Partnership policy was purchased, must currently be 
participating in the reciprocity standards. Accordingly, a State that 
elects an exemption from the reciprocity standards will not provide an 
asset disregard for Medicaid applicants who originally purchased 
Partnership policies in other, participating, Partnership States. 
Similarly, persons who originally purchased Partnership policies in a 
State that elected exemption from the reciprocity standards will not be 
eligible for asset disregards in other Partnership States. Once a State 
elects exemption from the standards, the exemption applies regardless 
of when a Medicaid applicant originally purchased a Partnership policy 
in another State (i.e., even if the Medicaid applicant purchased the 
policy prior to the date on which a State elected exemption from the 
reciprocity standards).

VIII. Notice of Exemption by Currently Participating States

    States that are currently participating in the reciprocity 
agreement agree that they will provide written notice to the Secretary 
at least 60 days prior to the effective date of electing an exemption 
from the reciprocity standards. The 60-day notification period makes it 
possible for the Department to notify other Participating States that, 
as of the effective date of withdrawal, asset disregards should no 
longer be made available to Medicaid applicants who originally 
purchased their policies in the State electing an exemption.

IX. Withdrawal of Reciprocity Exemption

    A State which has elected exemption from the Partnership 
reciprocity standards may also withdraw its election at any point. A 
State may do so by submitting a new SPA. Once a State withdraws its 
election, the State agrees that reciprocity will be applied to all 
people holding Partnership policies regardless of when the policy was 
originally purchased.

X. Outside Agreements

    There is nothing in these reciprocity standards which prohibits 
states from entering into reciprocity agreements with other states on a 
state-by-state basis, should they elect exemption from these 
reciprocity standards. The Department will create a communication 
mechanism for informing states and the public about which states have 
approved Partnership programs and which states are participating in 
these reciprocity standards.

XI. Change in Participation Status

    States that wish to change their participation status should submit 
a new state plan amendment.


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    Dated: August 20, 2008.
Mary M. McGeein,
Principal Deputy Assistant Secretary for Planning and Evaluation.
[FR Doc. E8-20225 Filed 8-29-08; 8:45 am]
BILLING CODE 4154-05-P