[Federal Register Volume 75, Number 152 (Monday, August 9, 2010)]
[Rules and Regulations]
[Pages 47710-47712]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2010-19312]


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DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 199

[DoD-2009-HA-0095]
RIN 0720-AB33


TRICARE; Extended Care Health Option

AGENCY: Office of the Secretary, Department of Defense.

ACTION: Final rule.

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SUMMARY: The Department of Defense is publishing this final rule to 
implement the requirements enacted by Congress in Section 732 of the 
Duncan Hunter National Defense Authorization Act for Fiscal Year 2009 
which changes the limit of the Government's share of providing certain 
benefits under the Extended Care Health Option (ECHO) from $2,500 per 
month to $36,000 per year, and for other non-legislated changes to the 
ECHO.

DATES: Effective Date: This rule is effective August 9, 2010 and 
applicable October 14, 2008. and all claims for ECHO benefits provided 
on or after that date will be reprocessed retroactively to that date as 
necessary.

FOR FURTHER INFORMATION CONTACT: Mr. Michael Kottyan, TRICARE 
Management Activity, Medical Benefits and Reimbursement Branch, 
telephone (303) 676-3520.

SUPPLEMENTARY INFORMATION:

I. Background

    Section 1079 of Title 10, United States Code (U.S.C.), as amended 
by Section 701(b) of the National Defense Authorization Act (NDAA) for 
Fiscal Year (FY) 2002 [Pub. L. 107-107], required the Department of 
Defense to establish a program of extended benefits for eligible 
dependents. That program, known as the Extended Care Heath Option 
(ECHO), replaced the Program for Persons with Disabilities (PFPWD) and 
was implemented on September 1, 2005. The primary purpose of the ECHO 
is to provide eligible beneficiaries with benefits that are not 
available through the TRICARE Basic Program. The term ``eligible 
beneficiary'' means an individual who is a dependent of an active duty 
service member (ADSM) or is a transitional survivor of a deceased ADSM 
and who has a qualifying condition. Qualifying conditions include 
moderate or severe mental retardation, serious physical disability, or 
an extraordinary physical or psychological condition. The benefits 
available through the ECHO are intended to assist in the reduction of 
the disabling effects of an ECHO qualifying condition.
    Section 1079(e)(3) and (4) authorizes benefits, including training, 
rehabilitation, special education, assistive technology devices, 
institutional care in private, nonprofit, public, and State 
institutions and facilities and, if appropriate, transportation to and 
from such institutions and facilities in which the beneficiary is 
receiving institutional care.
    Section 1079(f)(2) limited the Government's liability for benefits 
authorized by Section 1079(e)(3) and (4) to $2,500 per month and 
required that the beneficiary's sponsor be liable for any amount of the 
monthly total cost for those benefits that exceeded the Government's 
limit. Section 1079(e) also authorized the extended benefits program to 
provide additional benefits including diagnostic services, inpatient 
and outpatient care, comprehensive home health care, respite care, and 
other services and supplies as determined appropriate by the Secretary. 
However, Section 1079(f) did not limit the Government's liability for 
those additional benefits. By final rule published in the Federal 
Register (FR) on August 20, 2004, (69 FR 51559) the Department 
established that those additional benefits accrued to the $2,500 per 
month limit.
    Section 732 of the Duncan Hunter NDAA for FY 2009 [Pub. L. 110-417] 
(NDAA 2009) changed the limit of the Government's liability for 
benefits authorized under Section 1079(e)(3) and (4) from $2,500 per 
month to $36,000 per year, prorated as determined by the Secretary. 
This rule does not prorate the annual limit of Government liability. 
Section 732 does not affect other benefits authorized under Section 
1079(e).
    This rule changes the Government's share of providing all benefits 
available through the Extended Care Health

[[Page 47711]]

Option from $2,500 per month to $36,000 per FY. This rule does not 
change the Government's liability for benefits provided by the ECHO 
Home Health Care (EHHC) benefit or the EHHC Respite Care benefit.
    Additionally, Section 732 changed the sponsor's liability for costs 
exceeding the limit of the Government's liability from a per-month 
basis to a per-year basis; this rule includes that change.
    The following additional changes contained in this rule are further 
discussed below: Deletes references to the PFPWD, eliminates allocating 
the allowable cost of durable equipment authorized for purchase through 
the ECHO, clarifies the monthly reimbursement for benefits received 
through the EHHC, and allows a waiver of the requirement to enroll in 
the sponsor's branch of Service Exceptional Family Member Program 
(EFMP) in order to register in the ECHO.
    Active duty family members who have a qualifying condition are 
eligible to receive benefits through the ECHO. Qualifying conditions 
include moderate or severe mental retardation, a serious physical 
disability, or an extraordinary physical or psychological condition 
such that the beneficiary is homebound. Serious physical disabilities 
include those conditions that preclude an individual from the unaided 
performance of at least one major life activity such as breathing, 
cognition, hearing, seeing, and age-appropriate ability essential to 
bathing, dressing, eating, grooming, speaking, stair use, toilet use, 
transferring, and walking.
    The ECHO, as the replacement for the PFPWD, has been fully 
implemented for several years; it is, therefore, appropriate to delete 
references in the regulations to the transition of the PFPWD to the 
ECHO.
    Durable equipment, which is defined as a device or apparatus which 
does not qualify as ``Durable Medical Equipment'' under the TRICARE 
Basic Program but which is essential to the efficient arrest or 
reduction of the functional loss resulting from, or the disabling 
effects of an ECHO-qualifying condition, is eligible for TRICARE 
coverage through the ECHO. Paragraph (g)(2) within Sec. 199.5 provides 
for prorating the allowable amount for durable equipment over a 
calculated period of time. The method of proration resulted in the 
monthly benefit limit of $2,500 being divided, at the ECHO-registered 
beneficiary's sponsor's discretion, at least equally between the 
allowable cost of purchasing ECHO-authorized durable equipment and the 
cost of other authorized ECHO benefits. As a result of Section 732 and 
the changes made in this rule, the allowable expense for durable 
equipment accrues to the maximum FY Government limit of $36,000. 
Therefore, proration of allowable durable equipment expense is no 
longer an appropriate option. As a result, the ECHO beneficiary's 
sponsor will have only one cost-share liability for each authorized 
item of durable equipment purchased through the ECHO.
    The ECHO Home Health Care benefit is limited on a FY basis to the 
amount TRICARE would reimburse a Skilled Nursing Facility (SNF) if the 
beneficiary were a patient in the SNF. Paragraph (g)(4)(iii) of Sec. 
199.5 limits the maximum monthly Government reimbursement for the EHHC, 
including EHHC respite care, to no more than one-twelfth of the annual 
maximum Government cost-share. Because the actual number of days in the 
month varies, the one-twelfth limit can be over or understated for a 
given month. This rule revises that requirement by taking into account 
the actual number of days in a month EHHC benefits are received.
    As required by Section 1079(d)(1), eligible beneficiaries must 
register in the ECHO in order to receive ECHO benefits. Evidence of 
enrollment in the sponsor's branch of Service's EFMP is required in 
order to register in the ECHO. The Department recognizes there are 
circumstances when that requirement is not appropriate. This rule 
specifies when the EFMP enrollment requirement can be waived.
    Except as specified herein, all other requirements of the ECHO 
remain as currently published.

II. Public Comments

    We provided a 60-day public comment period following publication of 
the proposed rule in the Federal Register (74 FR 44800) on August 30, 
2009. No comments were received. However, following additional 
Department review, Section 199.5(g)(2)(ii) was revised further to 
clarify the sponsor's cost-share liability for benefits received under 
this section.

III. Regulatory Procedures

Executive Order 12866, ``Regulatory Planning and Review''

    Section 801 of Title 5, United States Code (U.S.C.), and Executive 
Order (E.O.) 12866 require certain regulatory assessments and 
procedures for any major rule or significant regulatory action, defined 
as one that would result in an annual effect of $100 million or more on 
the national economy or which would have other substantial impacts. It 
has been certified that this rule is not an economically significant 
rule, however, it is a regulatory action which has been reviewed by the 
Office of Management and Budget as required under the provisions of 
E.O. 12866.

Section 202, Public Law 104-4, ``Unfunded Mandates Reform Act''

    It has been certified that this rule does not contain a Federal 
mandate that may result in the expenditure by State, local and tribal 
governments, in aggregate, or by the private sector, of $100 million or 
more in any one year.

Public Law 96-354, ``Regulatory Flexibility Act'' (5 U.S.C. 601)

    The Regulatory Flexibility Act (RFA) requires each Federal agency 
prepare, and make available for public comment, a regulatory 
flexibility analysis when the agency issues a regulation which would 
have a significant impact on a substantial number of small entities. 
This rule will not significantly affect a substantial number of small 
entities for purposes of the RFA.

Public Law 96-511, ``Paperwork Reduction Act'' (44 U.S.C. Chapter 35)

    This rule will not impose significant additional information 
collection requirements on the public under the Paperwork Reduction Act 
of 1995 (44 U.S.C. 3501-3511). Existing information collection 
requirements of the TRICARE and Medicare programs will be utilized.

Executive Order 13132, ``Federalism''

    This rule has been examined for its impact under E.O. 13132 and it 
does not contain policies that have federalism implications that would 
have substantial direct effects on the States, on the relationship 
between the national government and the States, or on the distribution 
of power and responsibilities among the various levels of government; 
therefore, consultation with State and local officials is not required.

List of Subjects in 32 CFR Part 199

    Extended benefits for disabled family members of active duty 
service members, health care, military personnel.

0
Accordingly, 32 CFR part 199 is amended as follows:

PART 199--[AMENDED]

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1. The authority citation for part 199 continues to read as follows:

    Authority:  5 U.S.C. 301; 10 U.S.C. Chapter 55.

0
2. Section 199.5 is amended by:
0
a. Removing paragraphs (b)(4), (g)(2)(ii) introductory text through 
(g)(2)(ii)(C)(2), and (g)(2)(ii)(E);

[[Page 47712]]

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b. Redesignating paragraph (g)(2)(ii)(D) as (g)(2)(ii); and
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c. Revising paragraphs (c)(6), (c)(7)(iii), (f)(3)(i), (g)(2)(i), newly 
redesignated paragraph (g)(2)(ii), (g)(4)(iii), (h)(2), (h)(3)(v)(A), 
and (j) to read as follows:


Sec.  199.5  TRICARE Extended Care Health Option (ECHO).

* * * * *
    (c) * * *
    (6) Transportation of an ECHO beneficiary receiving benefits under 
paragraph (c)(5), and a medical attendant when necessary to assure the 
beneficiary's safety, to or from a facility or institution to receive 
authorized ECHO services or items.
    (7) * * *
    (iii) The Government's cost-share incurred for these services 
accrues to the fiscal year benefit limit of $36,000.
* * * * *
    (f) * * *
    (3) * * *
    (i) ECHO. The total Government share of the cost of all ECHO 
benefits, except ECHO Home Health Care (EHHC) and EHHC respite care, 
provided in a given fiscal year to a beneficiary, may not exceed 
$36,000 after application of the allowable payment methodology.
* * * * *
    (g) * * *
    (2) Equipment. (i) The TRICARE allowable amount for durable 
equipment shall be calculated in the same manner as durable medical 
equipment allowable through Section 199.4, and accrues to the fiscal 
year benefit limit specified in paragraph (f)(3) of this section.
    (ii) Cost-share. A cost-share, as provided by paragraph (f)(2) of 
this section, is required for each month in which equipment is 
purchased under this section. However, in no month shall a sponsor be 
required to pay more than one cost-share regardless of the number of 
benefits the sponsor's dependents received under this section.
* * * * *
    (4) * * *
    (iii) The maximum monthly Government reimbursement for EHHC, 
including EHHC respite care, will be based on the actual number of 
hours of EHHC services rendered in the month, but in no case will it 
exceed one-twelfth of the annual maximum Government cost-share as 
determined in this section and adjusted according to the actual number 
of days in the month the services were provided.
    (h) * * *
    (2) Registration. Active duty sponsors must register potential 
ECHO-eligible beneficiaries through the Director, TRICARE Management 
Activity, or designee prior to receiving ECHO benefits. The Director, 
TRICARE Management Activity, or designee will determine ECHO 
eligibility and update the Defense Enrollment Eligibility Reporting 
System accordingly. Unless waived by the Director, TRICARE Management 
Activity or designee, sponsors must provide evidence of enrollment in 
the Exceptional Family Member Program provided by their branch of 
Service at the time they register their family member(s) for the ECHO.
    (3) * * *
    (v) Public facility use. (A) An ECHO beneficiary residing within a 
state must demonstrate that a public facility is not available and 
adequate to meet the needs of their qualifying condition. Such 
requirements shall apply to beneficiaries who request authorization for 
training, rehabilitation, special education, assistive technology, and 
institutional care in private nonprofit, public, and state institutions 
and facilities, and if appropriate for beneficiaries receiving 
institutional care, transportation to and from such institutions and 
facilities. The maximum Government cost-share for services that require 
demonstration of public facility non-availability or inadequacy is 
limited to $36,000 per fiscal year per beneficiary. State-administered 
plans for medical assistance under Title XIX of the Social Security Act 
(Medicaid) are not considered available and adequate facilities for the 
purpose of this section.
* * * * *
    (j) Effective date. All changes to this section are effective as of 
October 14, 2008, and claims for ECHO benefits provided on or after 
that date will be reprocessed retroactively to that date as necessary.

    Dated: July 26, 2010.
Patricia L. Toppings,
OSD Federal Register Liaison Officer, Department of Defense.
[FR Doc. 2010-19312 Filed 8-6-10; 8:45 am]
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