67018 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

List of Subjects in 30 CFR Part 946

Intergovernmental relations, Surface

mining, Underground mining.

Dated: December 10, 1997.

Allen D. Klein,

Regional Director, Appalachian Regional

Coordinating Center.

[FR Doc. 97–33431 Filed 12–22–97; 8:45 am]

BILLING CODE 4310–05–M

DEPARTMENT OF DEFENSE

Office of the Secretary

32 CFR Part 199

[DoD 6010.8–R]

RIN 0720–AA39

Civilian Health and Medical Program of

the Uniformed Services (CHAMPUS);

Revisions to the Eligibility

Requirements

AGENCY: Office of the Secretary, DoD.

ACTION: Proposed rule.

SUMMARY: This proposed rule revises the

comprehensive CHAMPUS regulation

pertaining to basic CHAMPUS benefits

in accordance with several statutory

changes. This proposed rule: sets forth

the requirements for reinstatement of

CHAMPUS eligibility for beneficiaries

under age 65 who would otherwise have

lost eligibility for CHAMPUS due to

eligibility for Medicare as a result of

disability or end-stage renal disease

(ESRD); establishes new classes of

CHAMPUS eligibles; establishes the

Transitional Assistance Management

Program which provides transitional

health care for members (and their

dependents) who served on active duty

in support of a contingency operation

and for members (and their dependents)

who are involuntarily separated from

active duty; allows former spouses who

buy a conversion health policy to keep

CHAMPUS eligibility for twenty-four

(24) months for preexisting conditions

that are not covered by the conversion

policy; and makes minor technical

revisions to the double coverage

provisions. This proposed rule also adds

a new category of eligible beneficiary

under the Continued Health Care

Benefit Program.

DATES: Comments must be received by

February 23, 1998.

ADDRESSES: Send comments to the

Office of the Civilian Health and

Medical Program of the Uniformed

Services (OCHAMPUS), Program

Development Branch, Aurora, CO

80045–6900.

FOR FURTHER INFORMATION CONTACT:

Stephen E. Isaacson, Program

Development Branch, OCHAMPUS,

telephone (303) 361–1172.

SUPPLEMENTARY INFORMATION:

I. Eligibility Requirements

This proposed rule adds or revises a

number of eligibility provisions.

Following is a brief summary of the

classes of beneficiaries affected by this

proposed rule. Generally, each class is

eligible for CHAMPUS as a result of the

change, and we have included the other

salient points regarding each, but the

reader should refer to the subsequent

discussion for details regarding the

specific conditions and requirements for

each class.

CHAMPUS/Medicare dual eligibles.

• Must be under age 65, eligible for

Medicare due to disability or end-stage

renal disease, and enrolled in Medicare

Part B.

• Applies to all categories of

CHAMPUS beneficiaries except

dependents of active-duty members.

• Effective October 1, 1991.

Dependents of a person who dies of

an injury, illness, or disease incurred on

the way to or from training with a

duration of 30 days or less.

• Retiree cost-sharing.

• Effective November 14, 1986.

Victims of abuse.

• By a member who was discharged

or dismissed as a result of a courtmartial conviction for the abuse.

• Eligibility limited to one year from

member’s separation.

• Coverage limited to treatment of

conditions resulting from abuse.

• Effective November 14, 1986.

• By a member of former member

who loses eligibility to retired pay as a

result of the abuse.

• Effective October 23, 1992.

Students who become incapable of

self-support.

• Must be full-time student.

• The incapacitating condition must

occur between the ages of 21 and 23.

• Effective October 23, 1992.

Dependents of an active duty member

who dies while on active duty.

• These individuals have always been

eligible for CHAMPUS with retiree costsharing.

• The most recent change provides

that all care is to be cost-shared as active

duty.

• Special cost-sharing is limited to

one year.

• Effective October 1, 1993.

• For dependents of active-duty

members who die while on active duty

between January 1, 1993, and October 1,

1993, only care for pre-existing

conditions is to be cost-shared as active

duty.

Dependents placed in the custody of

a member or former member by a court

or a recognized placement agency.

• Effective July 1, 1994, if placed by

a court.

• Effective October 5, 1994, if placed

by a recognized placement agency.

• This category of beneficiary is also

added to the Continued Health Care

Benefit Program effective October 5,

1994.

Transitional Assistance Management

Program (TAMP)

• Claims for all individuals eligible

under TAMP are cost-shared as activeduty dependents.

• Members released from active duty

in connection with contingency

operations.

• Eligible up to thirty (30) days.

• Effective April 6, 1991.

• Members involuntarily separated

with less than six (6) years of service.

• Eligible up to sixty (60) days.

• Effective October 1, 1990.

• Members involuntarily separated

with six (6) or more years of service.

• Eligible up to 120 days.

• Effective October 1, 1990.

II. Reinstatement of CHAMPUS

Eligibility for Certain Medicare

Beneficiaries

A. Regulation Amendment

The regulation is being amended to

implement a series of laws enacted to

reinstate CHAMPUS eligibility for

certain individuals who, under previous

laws, would have lost their CHAMPUS

eligibility due to their eligibility for

Medicare. This section briefly describes

the amendment. A discussion of the

legislative enactments will then follow,

providing further explanation of the

amendment and the various interim

actions taken for implementation.

The amendment provides that

CHAMPUS eligibility will be reinstated

for beneficiaries:

1. Under age 65;

2. Who would otherwise have lost

eligibility for CHAMPUS due to

eligibility for Medicare as a result of

disability (as defined in 42 U.S.C.

426(b)(2)) or as a result of end stage

renal disease (ESRD) (as defined in 42

U.S.C. 426–1(a)); and,

3. Who are enrolled in the

supplementary medical insurance

program under Medicare Part B.

Under this amendment, CHAMPUS

eligibility will be reinstated effective

upon the date the individual meets all

three requirements cited above except

that eligibility cannot be reinstated for

care received prior to October 1, 1991.

Initially, a special coordination of

benefits procedure was established by
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67019

law under which CHAMPUS benefits

were paid for care received by these

reinstated eligible beneficiaries. Under

that special procedure, Medicare

benefits would have to be paid first;

then CHAMPUS, generally, would pay

only the amount of the remaining bill

which exceeded the beneficiaries;

CHAMPUS deductible, copayment, and

balance billing charge. Therefore, the

beneficiary usually had to pay a portion

of the bill even if the amount remaining

after Medicare payment did not exceed

the payment CHAMPUS would have

made if the patient had not been eligible

for Medicare.

However, under the most recent

legislation, the special coordination of

benefits procedure has been suspended

and the normal coordination of benefits

procedure used by CHAMPUS has been

authorized for reinstated eligible

beneficiaries. Under that procedure,

after Medicare benefits have been paid,

CHAMPUS, generally, will pay the

amount of the remaining bill up to the

amount CHAMPUS would have paid if

the patient had not been eligible for

Medicare. Because some claims were

processed under the special

coordination of benefits procedure prior

to enactment of this recent legislation,

the regulation amendment permits

beneficiaries to resubmit such claims for

reprocessing and payment under the

normal coordination of benefits

procedure.

Use of the normal coordination of

benefits procedure was first authorized

by the Department of Defense

Appropriations Act for FY 1993. It was

repeated in subsequent appropriations

acts and was incorporated into the

CHAMPUS law by the National Defense

Authorization Act for Fiscal Year 1995

(P.L. 103–337)

B. Background

Both section 704 of the National

Defense Authorization Act for fiscal

years 1992 and 1993 (P.L. 102–190) and

section 8097 of the Department of

Defense Appropriations Act, 1002. (P.L.

102–172) contained provisions which

reinstate CHAMPUS eligibility for

certain individuals who would

otherwise have lost their CHAMPUS

eligibility. As the Senate Armed

Services Committee report stated,

‘‘Under current law, a CHAMPUS

beneficiary who is classified as fully

disabled for two years under Social

Security standards automatically

becomes eligible for Medicare and loses

CHAMPUS eligibility. This provision

would authorize CHAMPUS to be a

secondary payer to Medicare * * * .’’

This action, according to the report,

‘‘provides a needed, equitable safely net

to CHAMPUS beneficiaries who

currently lose their CHAMPUS coverage

through no fault of their own before the

normal point of conversion to Medicare

at age 65.’’

The goal of this provision was to limit

the out-of-pocket expenses of these

individuals. By restoring CHAMPUS

eligibility for these individuals, the

coordination of benefits process will

ensure that the Medicare payment is at

least as much as the CHAMPUS

payment would have been in the

absence of Medicare, and, if it is not,

CHAMPUS will pay the difference.

Individuals will benefit, not only in

cases where the CHAMPUS cost-share

or deductible is less than Medicare’s,

but by being included in the more

generous CHAMPUS coverage of certain

services, notably prescription drugs and

mental health services. For example,

Medicare does not cover prescription

drugs, but CHAMPUS does.

These laws set forth special

procedures for determining CHAMPUS

payment in these dual eligibility cases,

and these were distinct from the normal

coordination of benefits procedures

followed by CHAMPUS in double

coverage situations. These procedures

are explained in greater detail in Section

D of this Section II. In addition, the laws

established two effective dates

depending upon the beneficiary class,

and they limited application of these

provisions to certain beneficiary classes.

Specifically, only those beneficiaries

whose eligibility for Medicare was

based on disability were able to have

their CHAMPUS eligibility restored,

while those beneficiaries whose

Medicare eligibility was based on endstage renal disease (ESRD) were not

affected by those provision and

remained ineligible for CHAMPUS.

In an attempt to rectify some of the

inconsistencies above, further statutory

changes were made for FY 1993. Section

705 of the National Defense

Authorization Act for FY 1993 (P.L.

102–484, enacted October 23, 1992) and

Section 9084 of the Department of

Defense Appropriations Act, 1993 (P.L.

102–396, enacted October 6, 1992)

contain provisions which affect these

procedures. The Authorization Act

extended the dual eligibility provisions

to individuals with ESRD, although the

Appropriations Act continued to

recognize only disabled former members

and their dependents as eligible for

reinstatement of CHAMPUS eligibility.

On the other hand, the Appropriations

Act required use of normal coordination

of benefits procedures for disabled

former members and their dependents

while the Authorization Act continued

to require use of the special payment

procedures for all beneficiaries whose

CHAMPUS eligibility was reinstated.

The laws also changed the effective date

of the provisions, making them

retroactive to October 1, 1991, and

eliminating the two effective dates.

Lastly, the Appropriations Act

contained a $20 million limitation on

the total CHAMPUS payments which

could be made under some of the

provisions. This limitation is further

described in Section F. of this Section

II.

Section 302 of the Supplemental

Appropriations Act of 1993 (P.L. 103–

50, enacted on July 2, 1993) made

additional changes to eliminate some of

the remaining inconsistencies. It

restored CHAMPUS eligibility for

individuals who would have lost their

CHAMPUS eligibility due to Medicare

eligibility based on ESRD, and thus

brought the Appropriations Act into

agreement with the Authorization Act

with regard to the individuals affected.

It also required that the normal

coordination of benefits procedures be

used for all beneficiaries whose

CHAMPUS eligibility has been

reinstated under these provisions and

made this retroactive to October 1, 1991.

This also affects the application of the

$20 million limitation on payments as

described in Section F. below.

The limitation on payments was not

included in the FY 1994 Appropriation

Act, but the procedural differences from

the authorization act continued. As of

FY 1995 the differences were resolved

by inclusion in the Authorization Act

for FY 1995 language which specified

use of normal double coverage

procedures for these beneficiaries.

C. Eligibility

We are applying this provision to all

individuals eligible for CHAMPUS

under title 10, U.S.C., section 1086(c).

Initially the Appropriations Acts (both

P.L. 102–172 and P.L. 102–396)

included only former members of the

Uniformed Services (those who are

entitled to retired or retainer pay or

equivalent pay) and the dependents of

such former members. However, the

Authorization Acts (P.L. 102–190 and

P.L. 102–484) and the Supplemental

Appropriations Act of 1993 (as well as

subsequent authorization and

appropriations acts) included these

beneficiaries as well as former spouses,

dependents of deceased active duty

members, and dependents of deceased

former members.

In addition to meeting the

requirements of title 10, U.S.C., section

1086(c), individuals also must meet the

following requirements in order to have

their CHAMPUS eligibility restored.
67020 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

1. They must be under age 65, the age

at which the beneficiary would

normally be required to switch from

CHAMPUS to Medicare coverage.

2. They would otherwise have lost

their CHAMPUS eligibility due to

eligibility for Medicare Part A as a result

of disability as defined in 42 U.S.C.

426(b)(2) or ESRD as defined in 42

U.S.C. 426–1(a). Under the provisions of

the 1992 Authorization and

Appropriations Acts, only those

individuals who are disabled may have

their CHAMPUS eligibility restored.

Individuals under age 65 who have lost

their CHAMPUS eligibility based on

entitlement to Medicare due to ESRD

were excluded from both Acts.

However, the Defense Authorization Act

for 1993 and the Supplemental

Appropriations Act of 1993 (and

subsequent acts) included ESRD as a

basis for reinstating CHAMPUS

eligibility for all beneficiaries included

in title 10, U.S.C. section 1086(c).

3. The individual must be enrolled in

Part B of Medicare. If an individual who

is enrolled in Part B subsequently

disenrolls, CHAMPUS eligibility will

end effective with the date of

termination of Part B enrollment.

Likewise, CHAMPUS eligibility cannot

begin prior to enrollment in Part B of

Medicare.

Any individual who meets these

eligibility requirements must enroll

under the Defense Enrollment Eligibility

Reporting System (DEERS). Enrollment

is available through the individual’s

Uniformed Service at the nearest

military personnel office. As with all

CHAMPUS eligibility, it is solely the

individual’s responsibility to enroll

under DEERS, and, except as described

in Section G. below, no attempt will be

made by the Office of CHAMPUS

(OCHAMPUS), by the CHAMPUS

contractors, or by any other entity to

identify or enroll eligible individuals. In

enrolling under DEERS, the individual

will be required to provide the

necessary documentation of age,

disability or ESRD, and Medicare

enrollment in Parts A and B.

D. Coordination of Benefits

These provisions do not affect in any

way the CHAMPUS benefits available.

They only extend CHAMPUS eligibility

to the affected individuals and provide

for payment procedures for CHAMPUS

as secondary payer to Medicare. These

provisions also do not affect the

statutory limitations regarding

CHAMPUS’ status as secondary payer to

all other coverage except Medicaid and

CHAMPUS supplemental plans.

Therefore, before a claim is submitted to

CHAMPUS, it first must be submitted to

all other coverages including Medicare

supplemental plans.

The FY 1992 Authorization and

Appropriations Acts required special

payment procedures for all beneficiaries

affected by this provision. These

procedures were intended to ensure that

a beneficiary’s out-of-pocket expenses

were no greater than they would have

been if CHAMPUS were the primary

payer. While this ensured that

beneficiaries were not financially

penalized for becoming eligible for

Medicare due to disability, these

procedures often resulted in less

CHAMPUS payment (and a

commensurate increase in beneficiary

liability) than would have occurred

under the normal coordination of

benefits procedures. As a result of this,

the FY 1993 Appropriations Act

required normal coordination of benefits

procedures to be used, but it only

applied to claims for disabled former

members and their dependents. The

special payment procedures still were to

be applied to former members and their

dependents who are eligible for

Medicare based on ESRD as well as to

all affected dependents of deceased

active duty members, dependents of

deceased former members, and former

spouses whether their eligibility for

Medicare is based upon disability or

ESRD. As a result of the Supplemental

Appropriations Act of 1993 and

subsequent authorization and

appropriations acts, normal

coordination of benefits procedures are

to be applied to all beneficiaries whose

CHAMPUS eligibility has been

reinstated under these provisions.

Under normal coordination of benefits

procedures, CHAMPUS will reimburse

the difference between the billed

amount (or the amount the provider is

required to accept as full payment) and

what the other insurance coverage paid,

if that difference is less than what

CHAMPUS would have paid in the

absence of other coverage. In most cases,

this results in no remaining out-ofpocket expense for the beneficiary.

Under the special payment

procedures, CHAMPUS payment was

limited to the amount by which the

patient’s Medicare deductible, costshare, and appropriate balance billing

costs exceed the patient’s CHAMPUS

deductible, cost-share, and balance

billing costs. Since the CHAMPUS costshare for these beneficiaries is often

greater than the Medicare cost-share or

deductible, in many cases this resulted

in no CHAMPUS payment, and the

beneficiary always had out-of-pocket

expenses (unless the beneficiary also

was covered by a Medicare or

CHAMPUS supplemental plan).

Even if CHAMPUS makes no payment

it is still advantageous to the beneficiary

for the claim to be submitted to

CHAMPUS. On all such claims the

CHAMPUS cost-sharing and deductible

amounts which are paid by other health

insurance, including Medicare, will be

credited toward meeting the CHAMPUS

deductible and the catastrophic cap.

Only by submitting these claims to

CHAMPUS can the deductible and

catastrophic cap entries be made, and

this can have a significant impact on

CHAMPUS payments on subsequent

claims, especially once the catastrophic

cap has been met.

If the care received by a beneficiary is

not a benefit under Medicare but is

under CHAMPUS (e.g. prescription

drugs), CHAMPUS will process the

claim as a routine claim. If the care is

a benefit under both Medicare and

CHAMPUS, the procedures explained

above will be followed.

In all cases, claims must first be

processed by Medicare, and it will be

necessary for a Medicare explanation of

benefits to be forwarded to the

CHAMPUS claims processing contractor

with the claim. The Medicare

explanation of benefits must reflect the

Medicare payment and the patient’s

Medicare deductible and cost-share.

This change will be applied on a

claim by claim basis. In other words, if

a beneficiary has an episode of care

which involves an inpatient hospital

stay and care by several professional

providers, each claim submitted for the

care will be processed independently,

and there will be no attempt made to

consolidate the claims.

The following examples are provided

to demonstrate the normal CHAMPUS

coordination of benefits procedures and

the special procedures and the impact of

each on CHAMPUS payments. Although

the special procedures are no longer

used, we are including them in the

examples, since the laws required them

to be used for a period of time and a

large number of claims were processed

using them.

1. EXAMPLE 1—NORMAL

COORDINATION OF BENEFITS

Hospital bills for inpatient care $5,722.00

Medicare DRG-based amount .. 5,368.95

Medicare inpatient hospital deductible .................................. 652.00

Medicare payment .................... 4,716.95

CHAMPUS DRG-based amount 4,949.59
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67021

1. EXAMPLE 1—NORMAL COORDINATION OF BENEFITS—Continued

CHAMPUS beneficiary costshare ..................................... 1 1,430.50

1 For claims paid under the CHAMPUS

DRG-based payment system, the cost-share is

the lesser of a per diem amount ($360 for FY

1997) or 25 percent of the billed charge. For

this example we assumed a length-of-stay of

five days.

Step 1. Determine CHAMPUS

payment in the absence of any other

coverage. This amount is $3,519.09.

Step 2. Subtract the Medicare primary

payment from the CHAMPUS DRGbased amount. This leaves $232.64.

Step 3. Subtract the Medicare primary

payment from the hospital’s charges (or

the amount the hospital is obligated to

accept as payment in full, if that is less

than the charges). The hospital must

accept the Medicare DRG-based amount

as payment in full, so this step results

in $652.00.

Step 4. Subtract any applicable

beneficiary cost-sharing amounts from

the provider’s charges (or the amount

the hospital is obligated to accept as

payment in full, if that is less than the

charges). This results in $4,043.95.

Step 5. CHAMPUS payment is the

least of Steps 1 through 4. CHAMPUS

pays $232.64. The beneficiary’s liability

is zero, since the hospital has been paid

the full CHAMPUS DRG-based amount,

and it must accept this as payment in

full.

2. EXAMPLE 2—SPECIAL PAYMENT

PROCEDURES

Hospital bills for inpatient care $5,722.00

Patient liability under medicare:

Medicare DRG-based

amount ........................... 5,368.95

Inpatient hospital Medicare

deductible ....................... 652.00

Medicare pays ................... 4,716.95

Patient liability under

CHAMPUS:

CHAMPUS DRG-based

amount ........................... 4,949.59

Beneficiary cost-share ....... 1 1,430.50

1For claims paid under the CHAMPUS

DRG-based payment system, the cost-share is

the lesser of a per diem amount ($360 for FY

1997) or 25 percent of the billed charge. For

this example we assumed a length-of-stay of

five days.

Since the beneficiary’s liability under

Medicare is less than it is under

CHAMPUS, CHAMPUS makes no

payment.

There are several other ramifications

which are pertinent here. Since the

beneficiary is eligible for CHAMPUS,

the claim must be submitted to

CHAMPUS before the beneficiary can be

billed for any amounts. CHAMPUS must

be billed if there is any remaining

beneficiary liability after Medicare

processes the claim—even if the

provider is certain that no payment will

be made by CHAMPUS. Any attempt to

bill the beneficiary without first billing

CHAMPUS can be considered a

violation of the statutory-based

participation requirement and can result

in exclusion of the provider by

CHAMPUS and possibly by Medicare.

In the above example, once the claim is

submitted to CHAMPUS, the CHAMPUS

DRG-based allowance ($4,949.59)

becomes the full payment amount for

the claim. Even though CHAMPUS

makes no payment, the beneficiary

liability is decreased from $652 (the

Medicare inpatient deductible) to

$232.64 (the difference between the

CHAMPUS DRG-based allowance and

the amount Medicare paid).

3. EXAMPLE 3.—NORMAL

COORDINATION OF BENEFITS

Physician bills for surgery ......... $1,200.00

Medicare allows ........................ 925.000

Medicare cost-share ................. 185.00

Medicare payment .................... 740.00

(Assumes the deductible has

been met)

CHAMPUS allows ..................... 975.00

CHAMPUS cost-share .............. 243.75

(Assumes the deductible has

been met)

Step 1: Determine CHAMPUS

payment in the absence of any other

coverage. This amount is $731.25.

Step 2: Subtract the primary payment

from the billed charge. This results in

$460.00.

Step 3: CHAMPUS payment is the

lesser of Steps 1 and 2. CHAMPUS pays

$460.00, and the beneficiary’s liability is

zero.

4. EXAMPLE 4.—SPECIAL PAYMENT

PROCEDURES

Physician bills for surgery ......... $1,200.00

Patient liability under Medicare:

Medicare allows ................. 925.00

Medicare cost-share .......... 185.00

Medicare payment ............. 740.00

(Assumes the deductible has

been met)

Patient liability under

CHAMPUS:

CHAMPUS allows .............. 975.00

CHAMPUS cost-share ....... 243.75

(Assumes the deductible has

been met)

Since the beneficiary’s liability under

Medicare is less than it is under

CHAMPUS, CHAMPUS makes no

payment, and the beneficiary’s liability

is $185 if the provider participates or

$460 is the provider does not

participate.

5. EXAMPLE 5.—SPECIAL PAYMENT

PROCEDURES

Mental illness outpatient care

bill .......................................... $450.00

(This is a benefit where Medicare pays only 50 percent of

the allowed charges.)

Patient liability under Medicare:

50% of allowed charges .... 225.00

(Assumes the full billed charge

was allowed and the $100

deductible has been met.)

Patient liability under

CHAMPUS:

25% of allowed charge ...... 112.50

(Assumes the full billed charge

was allowed and the $150

deductible has been met)

Since Medicare liability is greater

than CHAMPUS liability, CHAMPUS

pays the difference of $112.50, and the

beneficiary is liable for the remaining

$112.50.

E. Effective Date

According to the FY 1993

Authorization Act and subsequent

authorization and appropriations acts,

the effective date of this change is

October 1, 1991. This effective date

applies only if the individual lost

CHAMPUS eligibility prior to the

effective date. If CHAMPUS eligibility

was lost after the effective date,

CHAMPUS eligibility, and use of the

payment procedures required by this

change, will begin on the date the

individual first meets the eligibility

requirements in Section C. above. In this

case, effective means that the

individual’s eligibility will begin on the

effective date and claims will be

processed accordingly.

The above effective date is changed

from the effective date contained in the

FY 1992 Authorization and

Appropriation Acts. The procedures

required by those acts were effective for

former members and their dependents

as of October 1, 1991, and for all other

beneficiaries in title 10, U.S.C., section

1086(c) as of December 5, 1991.

As noted in Section C. above, it is the

individual’s responsibility to establish

eligibility through DEERS in order to

have claims processed by CHAMPUS. In

many cases this will result in retroactive

implementation of this change for

claims for services incurred between the

effective date and implementation of the

change pursuant to the final rule for this

change. In order to provide for some

closure to this retroactive

implementation, we propose that

beneficiaries will be given 180 days
67022 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

from the date of publication of the final

rule to apply to DEERS for reinstatement

of their eligibility. After that period, we

will begin eligibility effective with the

date of application to DEERS. In

addition, these beneficiaries will have

180 days from the date of publication of

the final rule to submit claims pursuant

to their reinstated eligibility which are

outside of the normal CHAMPUS claims

filing deadlines.

F. Limitation on Total Payments

The FY 1993 Appropriations Act

provided that ‘‘$20,000,000 shall be

available * * * to continue Civilian

Health and Medical Program of the

Uniformed Services (CHAMPUS)

benefits, until age 65, * * * for a former

member of the uniformed service who is

entitled to retired or retainer pay or

equivalent pay, or a dependent of such

a member, who becomes eligible for

hospital insurance benefits under part A

of title XVIII of the Social Security Act

* * * solely on the grounds of physical

disability: * * * .’’ We treated this as a

maximum limitation on the amount that

could be spent for these beneficiaries.

The Supplemental Appropriations

Act of 1993 did not directly alter this

provision. However, as a result of the

changes made by the Supplemental

Appropriations Act of 1993, the

limitation applied to all beneficiaries

‘‘described by section 1086(c) of title 10,

United States Code,’’ and ESRD in

addition to physical disability was

included as a qualifying condition. As a

result, all payments made for reinstated

beneficiaries were subject to the

limitation. This limit was not reached in

FY 1993, and it was not included in

subsequent appropriations acts.

III. Establishment of New Classes of

CHAMPUS Eligibles

Several new classes of CHAMPUS

eligibles have been added by changes to

the Department of Defense

Authorization Acts for recent years.

These new classes are:

• Eligible spouses (including former

spouses) or children of a reservist who

died after September 30, 1985, from an

injury or illness incurred or aggravated

while on active duty for a period of 30

days or less, on active duty for training,

or on inactive duty training, or while

traveling to or from the place at which

the reservist was to perform, or

performed, such active duty, active duty

for training, or inactive duty training.

These beneficiaries are eligible for

services or supplies provided on or after

October 1, 1985, and were added by

Section 652(c) of the Department of

Defense Authorization Act, 1986 (P.L.

99–145).

• Eligible spouses (including former

spouses) or children of a reservist who

died from a disease incurred or

aggravated after November 14, 1986,

while on active duty for a period of 30

days or less, on active duty for training,

or on inactive duty training, or while

traveling to or from the place at which

the reservist was to perform, or

performed, such active duty, active duty

for training, or inactive duty training.

These beneficiaries are eligible for

services or supplies provided on or after

November 14, 1986, and were added by

Section 604(a)(1) of the National

Defense Authorization Act for Fiscal

Year 1987 (P.L. 99–661).

• Eligible spouses (including former

spouses) and children of a member who

are victims of abuse by the member and

the member receives a dishonorable or

bad-conduct discharge or is dismissed

from a Uniformed Service as a result of

a court-martial conviction for abuse of

the dependent, or was administratively

discharged as a result of such an

offense. Medical benefits are limited to

treatment of injuries resulting from the

abuse for one year from the date of the

person’s separation from the Uniformed

Service. These beneficiaries are eligible

for services or supplies provided on or

after November 14, 1986, and were

added by the National Defense

Authorization Act for Fiscal Year 1987

(P.L. 99–661).

• Eligible spouses (including former

spouses) and children who are victims

of abuse by a member or former member

of a Uniformed Service who, while a

member and as a result of misconduct

involving abuse of a dependent, has

eligibility to receive retired pay on the

basis of years of service terminated.

These beneficiaries are eligible for

services or supplies provided on or after

October 23, 1992, and were added by

Section 653 of the National Defense

Authorization Act for Fiscal Year 1993

(P.L. 102–484).

• Otherwise eligible dependent

children who are not married and are

incapable of self-support because of a

mental or physical disability that

occurred between the ages of twentyone (21) and twenty-three (23) while the

child was enrolled in a full-time course

of study in an institution of higher

learning approved by the Administering

Secretary or the Department of

Education, and is or was at the time of

the member’s or former member’s death

dependent on the member or former

member for over one-half of his or her

support. The incapacity must be

continuous. If the incapacity

significantly improves or ceases at any

time, CHAMPUS eligibility cannot be

reinstated on the basis of the incapacity

unless the incapacity recurs and the

beneficiary is under age twenty-one (21)

or is under age twenty-three (23) and is

enrolled as a full-time student. If the

child was not incapacitated on his or

her twenty-third (23rd) birthday, but

becomes incapacitated after that date,

no CHAMPUS eligibility exists on the

basis of the incapacity. These

beneficiaries are eligible for services or

supplies provided on or after October

23, 1992, and were added by Section

653 of the National Defense

Authorization Act for Fiscal Year 1993

(P.L. 102–484).

• Dependents of active-duty members

who die while on active duty. These

individuals were previously eligible, but

now all care is to be cost-shared as

active duty for one year. These special

cost-sharing provisions apply to services

or supplies provided on or after October

1, 1993. For dependents of activity-duty

members who dies while on active duty

between January 1, 1993, and October 1,

1993, only care for pre-existing

conditions is to be cost-shared as active

duty. In both situations it is important

to note that this provision does not

preclude loss of eligibility during the

one-year period as a result of any

condition which routinely results in

loss of CHAMPUS eligibility such as

reaching age limits, remarriage, etc.

These provisions were added by Section

707(c) of the National Defense

Authorization Act for Fiscal Year 1995

(P.L. 103–337).

• Dependents who are placed in the

custody of a member or former member

by a court for a period of twelve (12)

consecutive months or more. These

beneficiaries are eligible for services or

supplies provided on or after July 1,

1994, and were added by Section 701 of

the National Defense Authorization Act

for Fiscal Year 1994 (P.L. 103–160).

• Dependents who are placed in the

home of a member or former member by

a placement agency which is recognized

by the Secretary of Defense in

anticipation of the legal adoption of the

child. These beneficiaries are eligible for

services or supplies provided on or after

October 5, 1994, and were added by

Section 701 of the National Defense

Authorization Act for Fiscal Year 1995

(P.L. 103–337).

IV. Transitional Assistance

Management Program

Based upon the provision of the

National Defense Authorization Act, FY

1991 (P.L. 101–510), the Persian Gulf

Conflict Supplemental Authorization

and Personnel Benefits Act of 1991 (P.L.

102–25), and the National Defense

Authorization Act, FY 1995, transitional

health care benefits under CHAMPUS
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67023

have been authorized for certain service

members and their families under

limited circumstances. The categories

affected include members and their

dependents who served in connection

with contingency operations and those

members otherwise subject to

involuntary separations from active

duty. The program that implements

these provisions is known as the

Transitional Assistance Management

Program (TAMP). All individuals

eligible under TAMP will be subject to

the same cost-sharing requirements

applicable to dependents of active-duty

members.

Under TAMP, members who are

released from active duty in connection

with contingency operations are eligible

for CHAMPUS for up to thirty (30) days

or until covered by an employersponsored health plan, whichever

occurs first. The earliest effective date of

eligibility for these beneficiaries is April

6, 1991.

UnderTAMP, members who are

involuntarily separated with less than

six (6) years of active service are eligible

for CHAMPUS for sixty (60) days.

Members who are involuntarily

separated with six (6) or more years of

active service are eligible for CHAMPUS

for 120 days. The TAMP provisions

applicable to involuntary separations

are effective for nine years beginning

October 1, 1990.

TAMP also provided for extended

CHAMPUS coverage for certain

individuals on a premium basis.

Previously, these individuals, upon

losing CHAMPUS eligibility, were

eligible to purchase temporary coverage

under a plan arranged by the

Department of Defense with Mutual of

Omaha Insurance Company. This plan

was known as Uniformed Services

Voluntary Insurance Policy (US VIP).

Section 4408 of P.L. 102–484

significantly revised this program. The

program is now required to provide

coverage with premiums and benefits

comparable to the Federal Employees

Health Benefits Program (FEHBP) and

for 18 to 36 months depending on the

eligibility category. The program is

known as the Continued Health Care

Benefit Program (CHCBP) and is

described in detail in 32 CFR Part

199.20. Eligibility under the CHCBP is

extended to certain members who are

discharged or released from active duty,

whether voluntarily, or involuntarily,

under other than adverse condition, to

certain former spouses of members or

former members, and to certain children

of a member or former member who

otherwise would not meet the

requirements for eligibility as a

dependent. Although technically these

individuals are not CHAMPUS

beneficiaries, this program is mentioned

here because it will enable these

individuals to purchase coverage similar

to CHAMPUS. The program began

October 1, 1994, and specific

implementation procedures have been

published.

V. Extension of Eligibility Period for

Former Spouses Who Buy a Conversion

Health Policy

Subsections 4407(b) and (c) of the

National Defense Authorization Act for

Fiscal Year 1993 amended Section

1086a of title 10 U.S.C. to allow

otherwise eligible former spouses who

buy a conversion health policy to keep

CHAMPUS eligibility for twenty-four

(24) months for preexisting conditions

that are not covered by the conversion

policy. The previous limit on such

extended CHAMPUS benefits was one

year. This provision applied only to the

USVIP policies, and the CHCBP does

not have an exclusion for preexisting

conditions. Since the USVIP expired on

September 30, 1994, this two-year

extension of CHAMPUS benefits was

effective only until September 30, 1996.

Therefore, we re not including any

change to the regulation to incorporate

this provision, since this provision has

already expired.

VI. Eligibility Determinations

Although OCHAMPUS is tasked with

publishing legislatively mandated

eligibility changes to Title 10 U.S.C.,

determination of dependent eligibility

for CHAMPUS is the primary

responsibility of the Uniformed

Services. CHAMPUS relies primarily on

the Defense Enrollment Eligibility

Reporting System (DEERS) for eligibility

verification. However, a determination

by the Uniformed Services that a person

is eligible does not automatically entitle

such a person to CHAMPUS payments.

Before any CHAMPUS benefits may be

extended, additional requirements of

CFR Part 199 must be met. Disputes

regarding eligibility as a dependent or

dates of beginning eligibility for benefits

under CHAMPUS can only be resolved

by the appropriate Uniformed Service

Secretary.

VII. Technical Revisions to the Double

Coverage Provisions

We are also making several wording

changes to Paragraph (a) of Section

199.8, Double Coverage, in order to

make it conform to the latest version of

10 U.S.C. 1079(j)(1) as revised by

Section 713, P.L. 102–190. These

changes merely revise some of the

wording and have no affect on the

actual double coverage procedures

under CHAMPUS. We are making them

at this time, since Section 199.8 is being

revised by this rule.

VIII. Addition of New Category of

Eligible Beneficiary Under the

Continued Health Care Benefit Program

(CHCBP)

Section 702 of the 1995 National

Defense Authorization Act (P.L. 103–

337) expanded the eligibility for health

care coverage under the CHCBP to a

fourth group of beneficiaries from the

group originally authorized in the

CHCBP Final Rule, published in the

Federal Register on September 30, 1994,

(59 FR 49817). Eligibility to enroll in the

CHCBP has been expanded to now

include unmarried persons placed in

the legal custody of a member or former

member as the result of a court order or

by a placement agency recognized by

the Secretary of Defense.

Health care coverage in the CHCBP is

for a specific time period. For the new

group of eligible beneficiaries—

unmarried persons placed in the legal

custody of a member or former member

(age 21 if not in college or up to age 23

if in college)—coverage can be up to a

total of 36 months. These individuals

will have 60 days to enroll beginning

the date they become eligible.

This change is effective October 5,

1994.

IX. Regulatory Procedures

The Regulatory Flexibility Act (RFA)

requires that 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 proposed rule is not a significant

regulatory action under Executive Order

12866. The changes set forth in this

proposed rule are minor revisions to the

existing regulation. Since this proposed

rule does not impose information

collection requirements, it does not

need to be reviewed by the Executive

Office of Management and Budget under

authority of the Paperwork Reduction

Act of 1995 (44 U.S.C. Chapter 35).

List of Subjects in 32 CFR Part 199

Claims, Health insurance, Individuals

with disabilities, Military personnel,

Reporting and recordkeeping

requirements.

Accordingly, 32 CFR Part 199 is

amended as follows:

PART 199—[AMENDED]

1. The authority citation for Part 199

continues to read as follows:
67024 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

Authority: 5 U.S.C. 301; 10 U.S.C. chapter

55.

2. Section 199.2 is amended by

adding new definitions for Abused

dependent, Deceased reservist,

Deceased retiree, Former member,

Member, Reservist in alphabetical order,

by removing the definition for Deceased

service member and adding in

alphabetical order a new definition for

Deceased member, and by revising the

definitions for Child, Defense

Enrollment Eligibility Reporting System

(DEERS), Dependent, Sponsor, Spouse,

Widow or Widower to read as follows:

§ 199.2 Definitions.

* * * * *

(b) * * *

Abused dependent. An eligible

spouse or child, who meets the criteria

in § 199.3 of this part, of a former

member who received a dishonorable or

bad-conduct discharge or was dismissed

from a Uniformed Service as a result of

a court-martial conviction for an offense

involving physical or emotional abuse

or was administratively discharged as a

result of such an offense, or of a member

or former member who has had their

entitlement to receive retired pay

terminated because of misconduct

involving physical or emotional abuse.

* * * * *

Child. An unmarried child of a

member or former member, who meets

the criteria (including age requirements)

in § 199.3 of this part.

* * * * *

Deceased member. A person who, at

the time of his or her death, was an

active duty member of a Uniformed

Service under a call or order that did

not specify a period of 30 days or less.

Deceased reservist. A reservist in a

Uniformed Service who incurs or

aggravates an injury, illness, or disease,

during, or on the way to or from, active

duty training for a period of 30 days or

less or inactive duty training and dies as

a result of that specific injury, illness or

disease.

Deceased retiree. A person who, at the

time of his or her death, was entitled to

retired or retainer pay or equivalent pay

based on duty in a Uniformed Service.

For purposes of this part, it also

includes a person who died before

attaining age 60 and at the time of his

or her death:

(1) Would have been eligible for

retired pay as a reservist but for the fact

that he or she was not 60 years of age;

and

(2) Had elected to participate in the

Survivor Benefit Plan established under

chapter 73 of tile 10 U.S.C.

* * * * *

Defense Enrollment Eligibility

Reporting System (DEERS). An

automated system maintained by the

Department of Defense for the purpose

of:

(1) Enrolling members, former

members and their dependents; and

(2) Verifying members’, former

members’ and their dependents’

eligibility for health care benefits in the

direct care facilities and for CHAMPUS.

* * * * *

Dependent. Individuals whose

relationship to the sponsor (including

NATO members who are stationed in or

passing through the United States on

official business when authorized) leads

to entitlement to benefits under this

part. (See § 199.3 of this part for specific

categories of dependents).

* * * * *

Former member. A retiree, deceased

member, deceased retiree, or deceased

reservist in certain circumstances (see

§ 199.3 of this part for additional

information related to certain deceased

reservists’ dependents’ eligibility).

Under conditions specified under

§ 199.3 of this part, former member may

also include a member of the Uniformed

Services who has been discharged from

active duty (or, in some cases, full-time

National Guard duty), whether

voluntarily or involuntarily, under other

than adverse conditions and qualifies

for CHAMPUS benefits under the

Transitional Assistance Management

Program or the Continued Health Care

Benefits Program.

* * * * *

Member. A person on active duty in

a Uniformed Service under a call or

order that does not specify a period of

30 days or less. (For CHAMPUS costsharing purposes only, a former member

who received a dishonorable or badconduct discharge or was dismissed

from a Uniformed Service as a result of

a court-martial conviction for an offense

involving physical or emotional abuse

or was administratively discharged as a

result of such an offense is considered

a member).

* * * * *

Reservist. A person who is under an

active duty call or order to one of the

Uniformed Services for a period of 30

days or less or is on inactive training.

* * * * *

Sponsor. A member or former member

of a Uniformed Service upon whose

status his or her dependents’ eligibility

for CHAMPUS is based. A sponsor also

includes a person who, while a member

of the Uniformed Services and after

becoming eligible to be retired on the

basis of years of service, has his or her

eligibility to receive retired pay

terminated as a result of misconduct

involving abuse of a spouse or

dependent child. It also includes NATO

members who are stationed in or

passing through the United States on

official business when authorized. It

also includes individuals eligible for

CHAMPUS under the Transitional

Assistance Management Program.

Spouse. A lawful husband or wife,

who meets the criteria in § 199.3 of this

part, regardless of whether or not

dependent upon the member or former

member for his or her own support.

* * * * *

Widow or Widower. A person who

was a spouse at the time of death of a

member or former member and who has

not remarried.

* * * * *

3. Section 199.3 is revised to read as

follows:

§ 199.3 Eligibility.

(a) General. This section sets forth

those persons who, by the provisions of

10 U.S.C. chapter 55, and the NATO

Status of Forces Agreement, are eligible

for CHAMPUS benefits. A

determination that a person is eligible

does not automatically entitle such a

person to CHAMPUS payments. Before

any CHAMPUS benefits may be

extended, additional requirements, as

set forth in other sections of this Part,

must be met. Additionally, the use of

CHAMPUS may be denied if a

Uniformed Service medical treatment

facility capable of providing the needed

care is available. CHAMPUS relies

primarily on the Defense Enrollment

Eligibility Reporting System (DEERS) for

eligibility verification.

(b) CHAMPUS eligibles—(1) Retiree. A

member or former member of a

Uniformed Service who is entitled to

retired, retainer, or equivalent pay based

on duty in a Uniform Service.

(2) Dependent. Individuals whose

relationship to the sponsor leads to

entitlement to benefits. CHAMPUS

eligible dependent include the

following:

(i) Spouse. A lawful husband or wife

of a member or former member. The

spouse of a deceased member or retiree

must not be remarried. A former spouse

also may qualify for benefits as a

dependent spouse. A former spouse is a

spouse who was married to a military

member, or former member, but whose

marriage has been terminated by a final

decree of divorce, dissolution or

annulment. To be eligible for

CHAMPUS benefits, a former spouse

must meet the criteria described in

paragraph (b)(2)(i)(A) through (b)(2)(i)(E)

of this section and must qualify under
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67025

the group defined in paragraph

(b)(2)(i)(F)(1) or (b)(2)(i)(F)(2):

(A) Must be unremarried; and

(B) Must not be covered by an

employer-sponsored health plan; and

(C) Must have been married to a

member or former member who

performed at least 20 years of service

which can be credited in determining

the member’s or former member’s

eligibility for retired or retainer pay; and

(D) Must not be eligible for Part A of

Title XVII of the Social Security Act

(Medicare) except as provided in

paragraphs (f)(3)(viii) and (f)(3)(ix) of

this section; and

(E) Must not be the dependent of a

NATO member; and

(F) Must meet the requirements of

paragraph (b)(2)(i)(F)(1) or (b)(2)(i)(F)(2)

of this section:

(1) The former spouse must have been

married to the same member or former

member for at least 20 years, at least 20

of which were creditable in determining

the member’s or former member’s

eligibility for retired or retainer pay.

Eligibility continues indefinitely unless

affected by any of the conditions of

paragraphs (b)(2)(i)(A) through

(b)(2)(i)(E).

(i) If the date of the final decree of

divorce, dissolution, or annulment was

before February 1, 1983, the former

spouse is eligible for CHAMPUS

coverage of health care received on or

after January 1, 1985.

(ii) If the date of the final decree of the

divorce, dissolution, or annulment was

on or after February 1, 1983, the former

spouse is eligible for CHAMPUS

coverage of health care which is

received on or after the date of the

divorce, dissolution, or annulment.

(2) The former spouse must have been

married to the same member or former

member for at least 20 years, and at least

15, but less than 20 of those married

years were creditable in determining the

member’s or former member’s eligibility

for retired or retainer pay.

(i) If the date of the final decree of

divorce, dissolution, or annulment is

before April 1, 1985, the former spouse

is eligible only for care received on or

after January 1, 1985, or the date of the

divorce, dissolution, or annulment,

whichever is later. Eligibility continues

indefinitely unless affected by any of

the conditions of paragraphs (b)(2)(i)(A)

through (b)(2)(i)(E).

(ii) If the date of the final decree of

divorce, dissolution or annulment is on

or after April 1, 1985, but before

September 29, 1988, the former spouse

is eligible only for care received from

the date of the decree of divorce,

dissolution, or annulment until

December 31, 1988, or for two years

from the date of the divorce,

dissolution, or annulment, whichever is

later.

(iii) If the date of the final decree of

divorce, dissolution, or annulment is on

or after September 29, 1988, the former

spouse is eligible only for care received

within the 365 days (366 days in the

case of a leap year) immediately

following the date of the divorce,

dissolution, or annulment.

(ii) Child. A dependent child is an

unmarried child of a member or former

member who has not reached his or her

twenty-first (21st) birthday, except an

incapacitated adopted child meeting the

requirements of paragraph

(b)(2)(ii)(H)(2) of this section, and who

bears one of the following relationships

to a member or former member of one

of the Uniformed Services:

(A) A legitimate child; or

(B) An adopted child whose adoption

has been legally completed on or before

the child’s twenty-first (21st) birthday;

or

(C) A legitimate stepchild; or

(D) An illegitimate child of a member

or former member whose paternity/

maternity has been determined

judicially, and the member or former

member directed to support the child; or

(E) An illegitimate child of a member

or former member whose paternity/

maternity has not been determined

judicially, who resides with or in the

home provided by the member or former

member, and is or continues to be

dependent upon the member or former

member for over one-half of his or her

support, or who was so dependent on

the former member at the time of the

former member’s death; or

(F) An illegitimate child of a spouse

of a member who resides with or in a

home provided by the member and is,

and continues to be dependent upon the

member for over one-half of his or her

support; or

(G) An illegitimate child of a spouse

of a former member who resides with or

in a home provided by a former member

or the former member’s spouse at the

time of death of the former member, and

is, or continues to be, or was, dependent

upon the former member for more than

one-half of his or her support at the time

of death; or

(H) An individual who falls into one

of following classes:

(1) A student. A child determined to

be a member of one of the classes in

paragraphs (b)(2)(ii)(A) through

(b)(2)(ii)(G) of this section, who is not

married, has passed his or her 21st

birthday but has not passed his or her

23rd birthday, is dependent upon the

member or former member for over 50

percent of his or her support or was

dependent upon the member or former

member for over 50 percent of his or her

support on the date of the member’s or

former member’s death, and is pursuing

a full-time course of education in an

institution of higher learning approved

by the Secretary of Defense or the

Department of Education (as

appropriate) or by a state agency under

38 U.S.C., Chapters 34 and 35.

Note to paragraph (b)(2)(ii)(H)(1): Courses

of education offered by institutions listed in

the ‘‘Education Directory, ‘‘Higher

Education’’ or ‘‘Accredited Higher

Institutions’’ issued periodically by the

Department of Education meet the criteria

approved by the Administering Secretary or

the Secretary of Education. For determination

of approval of courses offered by a foreign

institution, by an institution not listed in

either of the above directories, or by an

institution not approved by a state agency

pursuant to 38 U.S.C. chapters 34 and 35, a

statement may be obtained from the

Department of Education, Washington, D.C.

20202.

(2) An incapacitated child. A child

determined to be a member of one of the

classes in paragraphs (b)(2)(ii)(A)

through (b)(2)(ii)(G) of this section, who

is not married, has not attained the age

of 21, and is incapable of self-support

because of a mental or physical

disability that:

(i) Existed before the child’s twentyfirst (21st) birthday; or

(ii) Occurred between the ages of 21

and 23 while the child was enrolled in

a full-time course of study in an

institution of higher learning approved

by the Administering Secretary or the

Department of Education (see Note to

paragraph (b)(2)(ii)(H)(2)), and is or was

at the time of the member’s or former

member’s death dependent on the

member or former member for over onehalf of his or her support; and

(iii) The incapacity is continuous. (If

the incapacity significantly improves or

ceases at any time, CHAMPUS

eligibility cannot be reinstated on the

basis of the incapacity, unless the

incapacity recurs and the beneficiary is

under age 21, or is under age 23 and is

enrolled as a full-time student under

paragraph (b)(2)(ii)(H)(2)(ii) of this

section. If the child was not

incapacitated after that date, no

CHAMPUS eligibility exists on the basis

of the incapacity. However,

incapacitated children who marry and

who subsequently become unmarried

through divorce, annulment, or death of

spouse, may be reinstated as long as

they still meet all other requirements).

Note to paragraph (b)(2)(ii)(H)(2): An

institution of higher learning is a college,

university, or similar institution, including a

technical or business school, offering post-
67026 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

secondary level academic instruction that

leads to an associate or higher degree, if the

school is empowered by the appropriate State

education authority under State law to grant

an associate, or higher, degree. When there is

no State law to authorize the granting of a

degree, the school may be recognized as an

institution of higher learning if it is

accredited for degree programs by a

recognized accrediting agency. The term also

shall include a hospital offering educational

programs at the post-secondary level

regardless of whether the hospital grants a

post-secondary degree. The term also shall

include an educational institution that is not

located in a State, that offers a course leading

to a standard college degree, or the

equivalent, and that is recognized as such by

the Secretary of Education (or comparable

official) of the country, or other jurisdiction,

in which the institution is located (38 U.S.C.

chapter 34, section 1661, and chapter 35,

section 1701). Courses of education offered

by institutions listed in the ‘‘Education

Directory’’, ‘‘Higher Education’’ or

‘‘Accredited Higher Institutions’’ issued

periodically by the Department of Education

meet the criteria approved by the

Administering Secretary or the Secretary of

Education. For determination of approval of

courses offered by a foreign institution, by an

institution not listed in either of the above

directories, or by an institution not approved

by a state agency pursuant to 38 U.S.C.

chapters 34 and 35, a statement may be

obtained from the Department of Education,

Washington, D.C. 20202.

(3) A child of a deceased reservist. A

child, who is determined to be a

member of one of the classes in

paragraphs (b)(2)(ii)(A) through

(b)(2)(ii)(G) of this section, of a reservist

in a Uniformed Service who incurs or

aggravates an injury, illness, or disease,

during, or on the way to or from, active

duty training for a period of 30 days or

less or inactive duty training, and the

reservist dies as a result of that specific

injury, illness or disease.

(4) A child placed in legal custody of

a member or former member. A child

who is placed in legal custody of a

member or former member by a court or

who is placed in the home of a member

or former member by a recognized

placement agency in anticipation of the

legal adoption of the child.

(iii) Abused dependents.—(A)

Categories of abused dependents. An

abused dependent may be either a

spouse or a child. Eligibility for either

class of abused dependent results from

being either:

(1) The spouse (including a former

spouse) or child of a member who has

received a dishonorable or bad-conduct

discharge, or dismissal from a

Uniformed Service as a result of a courtmartial conviction for an offense

involving physical or emotional abuse

of the spouse or child, or was

administratively discharged as a result

of such an offense. Medical benefits are

limited to care related to the physical or

emotional abuse and for a period of 12

months following the member’s

separation from the Uniformed Service.

(2) The spouse (including a former

spouse) or child of a member or former

member who while a member and as a

result of misconduct involving abuse of

the spouse or child has eligibility to

receive retired pay on the basis of years

of service terminated.

(B) Requirements for categories of

abused dependents. (1) Abused spouse.

As long as the spouse is receiving

payments from the Dod Military

Retirement Fund under court order, the

spouse is eligible for health care under

the same conditions as any spouse of a

retired member. The abused spouse

must:.

(i) Under paragraph (b)(2)(iii)(A)(1) of

this section, be a lawful husband or wife

or a former spouse of the member; or

(ii) Under paragraph (b)(2)(iii)(A)(2) of

this section, be a lawful husband or wife

or a former spouse of the member or

former member, and the spouse is

receiving payments from the

Department of Defense Military

Retirement Fund under 10 U.S.C.

1408(h) pursuant to a court order; and—

(A) Be a victim of the abuse; and

(B) Have been married to the member

or former member at the time of the

abuse; or

(C) Be the natural or adoptive parent

of a dependent child of the member or

former member who was the victim of

the abuse.

(2) Abused child. The abused child

must:

(i) Under paragraph (b)(2)(iii)(A)(1) of

this section, be a dependent child of the

member or former member.

(ii) Under paragraph (b)(2)(iii)(A)(2) of

this section—

(A) Have been a member of the

household where the abuse occurred;

and

(B) Be an unmarried legitimate child,

including an adopted child or stepchild

of the member or former member; and

(C) Be under the age of 18; or

(D) Be incapable of self support

because of a mental or physical

incapacity that existed before becoming

18 years of age and be dependent on the

member or former member for over onehalf of his or her support; or

(E) If enrolled in a full-time course of

study in an institution of higher

learning recognized by the Secretary of

Defense (for the purpose of 10 U.S.C.

1408(h)), be under 23 years of age and

be dependent on the member or former

member for over one-half of his or her

support.

(iii) The dependent child is eligible

for health care, regardless of whether

any court order exists, under the same

conditions as any dependent of a retired

member.

(3) TAMP eligibles. A former member,

including his or her dependents, who is

eligible under the provisions of the

Transitional Assistance Management

Program as described in paragraph (e) of

this section.

(c) Beginning dates of eligibility. (1)

Beginning dates of eligibility dependent

on the class to which the individual

belongs and the date the individual

became a member of the class. Those

who join after the class became eligible

attain individual eligibility on the date

they join.

(2) Beginning dates of eligibility for

each class of spouse (excluding spouses

who are victims of abuse and eligible

spouses of certain deceased reservists)

are as follows:

(i) A spouse of a member for:

(A) Medical benefits authorized by the

Dependents’ Medical Care Act of 1956,

December 7, 1956;

(B) Outpatient medical benefits under

the Basic Program, October 1, 1966;

(C) Inpatient medical benefits under

the Basic Program and benefits under

the Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped), January

1, 1967;

(ii) A spouse of a former member:

(A) For medical benefits under the

Basic Program, January 1, 1967;

(B) Ineligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped);

(iii) A former spouse:

(A) For medical benefits under the

Basic Program, dates of beginning

eligibility are as indicated for each

category of eligible former spouse

identified in paragraph (b)(2)(i) of this

section;

(B) Ineligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(3) Beginning dates of eligibility for

spouses who are victims of abuse

(excluding spouses who are victims of

abuse of certain deceased reservists) are

as follows:

(i) An abused spouse meeting the

requirements of paragraph (b)(2)(iii) of

this section, including an eligible former

spouse:

(A) For medical and dental care for

problems associated with the physical

or emotional abuse under the Basic

Program for a period of up to one year

(12 months) following the person’s

separation from the Uniformed Service,

November 14, 1986.

(B) For medical and dental care for

problems associated with the physical
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67027

or emotional abuse under the Program

for Persons with Disabilities (formerly

known as the Program for the

Handicapped) for a period up to one

year (12 months) following the person’s

separation from the Uniformed Service,

November 14, 1986.

(ii) An abused spouse meeting the

requirements of paragraph (b)(2)(iii) of

this section, including an eligible former

spouse:

(A) For all benefits under the

CHAMPUS Basic Program, October 23,

1992.

(B) Ineligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(4) Beginning dates of eligibility for

spouses of certain deceased reservists,

including spouses who are victims of

abuse of certain deceased reservists, are

as follows:

(i) A spouse meeting the requirements

of paragraph (b)(2)(i) of this section,

including an eligible former spouse:

(A) For benefits under the Basic

Program, November 14, 1986.

(B) Ineligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(ii) An abused spouse of certain

deceased reservists, meeting the

requirements of paragraph (b)(2)(iii) of

this section, including an eligible former

spouse, for the limited benefits and

period of eligibility described in

paragraph (b)(2)(iii) of this section:

(A) For benefits under the Basic

Program, November 14, 1986.

(B) For benefits under the Program for

Persons with Disabilities (formerly

known as the Program for the

Handicapped), November 14, 1986.

(iii) An abused spouse of certain

deceased reservists, including an

eligible former spouse, meeting the

requirements of paragraph (b)(2)(iii) of

this section:

(A) For benefits under the Basic

Program, October 23, 1992.

(B) Ineligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(5) Beginning dates of eligibility for

each class of dependent children,

(excluding dependent children of

certain deceased reservists, abused

children and incapacitated children

whose incapacity occurred between the

ages of 21 and 23 while enrolled in a

full-time course of study in an

institution of higher learning), are as

follows:

(i) Legitimate child, adopted child, or

legitimate stepchild of a member, for:

(A) Medical benefits authorized by the

Dependents’ Medical Care Act of 1956,

December 7, 1956.

(B) Outpatient medical benefits under

the Basic Program, October 1, 1966.

(C) Inpatient medical benefits under

the Basic Program and benefits under

the Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped), January

1, 1967.

(ii) Legitimate child, adopted child or

legitimate stepchild of former members:

(A) For medical benefits under the

Basic Program, January 1, 1967.

(B) Ineligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(iii) Illegitimate child of a male or

female member or former member

whose paternity/maternity has been

determined judicially and the member

or former member has been directed to

support the child, for:

(A) All benefits for which otherwise

entitled, August 31, 1972.

(B) Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped) benefits

limited to dependent children of

members only, August 31, 1972.

(iv) Illegitimate child of:

(A) A male member or former member

whose paternity has not been

determined judicially;

(B) A female member or former

member who resides with, or in a home

provided by the member or former

member, or who was residing in a home

provided by the member or former

member at the time of the member’s or

former member’s death, and who is or

continues to be dependent on the

member for over one-half of his or her

support, or was so dependent on the

member or former member at the time

of death;

(C) A spouse of a member or former

member who resides with or in a home

provided by the member or former

member, or the parent who is the spouse

of the member or former member or was

the spouse of a member or former

member at the time of death, and who

is and continues to be dependent upon

the member or former member for over

one-half or his or her support, or was so

dependent on the member or former

member at the time of death; for:

(1) All benefits for which otherwise

eligible, January 1, 1969.

(2) Program for Persons with

Disabilities (formerly known as the

Program for the handicapped) limited to

dependent children of members only,

January 1, 1969.

(v) An adopted child, 21 years or

older, with an incapacitating condition

that existed before the age of 21, who

was adopted after the age of 21, who has

been residing with a member or former

member for at least 12 months prior to

the date of the adoption and is, or

continues to be, dependent upon the

member or former member for over onehalf of his or her support, or was so

dependent upon the former member at

the time of the former member’s death;

for:

(A) All benefits for which otherwise

entitled, October 23, 1992.

(B) Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped) benefits

limited to dependents of members only,

October 23, 1992.

(6) Beginning dates of eligibility for

children of certain deceased reservists

who meet the requirements of paragraph

(b)(2)(ii)(H)(3) of this section, excluding

incapacitated children who meet the

requirements of paragraph

(b)(2)(ii)(H)(2) of this section, for:

(i) Benefits under the Basic program,

November 14, 1986.

(ii) Not eligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(7) Beginning dates of eligibility for

children who are victims of abuse who

meet the requirements of paragraph

(b)(2)(iii) of this section, including

incapacitated children who meet the

requirements of paragraph

(b)(2)(ii)(H)(2) of this section for:

(i) Medical and dental care for

problems associated with the physical

or emotional abuse under the Basic

Program for a period of up to one year

(12 months) following the person’s

separation from the Uniformed Service,

November 14, 1986.

(ii) Medical and dental care for

problems associated with the physical

or emotional abuse under the Program

for Persons with Disabilities (formerly

known as the Program for the

Handicapped) for a period up to one

year (12 months) following the person’s

separation from the Uniformed Service,

November 14, 1986.

(8) Beginning dates of eligibility for

incapacitated children who meet the

requirements of paragraph

(b)(2)(ii)(H)(2) of this section, whose

incapacity occurred between the ages of

21 and 23 while enrolled in a full-time

course of study in an institution of

higher learning approved by the

Administering Secretary or the

Department of Education, and, are or

were at the time of the member’s or

former member’s death, dependent on

the member or former member for over

one-half of their support for:
67028 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

(i) All benefits for which otherwise

entitled; October 23, 1992.

(ii) Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped) benefits

limited to children of members only,

October 23, 1992.

(9) Beginning dates of eligibility for a

child who meets the requirements of

paragraph (b)(2)(ii)(H)(4) and:

(i) Has been placed in custody by a

court:

(A) All benefits for which entitled,

July 1, 1994.

(B) Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped) benefits

limited to children of members only,

July 1, 1994.

(ii) Has been placed in custody by a

recognizing adoption agency:

(A) All benefits for which entitled,

October 5, 1994.

(B) Program for Persons with

Disabilities (formerly known as the

Program for the Handicapped) benefits

limited to children of members only,

October 5, 1994.

(10) Beginning dates of eligibility for

a retiree for:

(i) Medical benefits under the Basic

Program January 1, 1967.

(ii) Retirees and their dependents are

not eligible for benefits under the

Program for Persons with Disabilities

(formerly known as the Program for the

Handicapped).

(d) Dual eligibility. Dual eligibility

occurs when a person is entitled to

benefits from two sources. For example,

when an active duty member is also the

dependent of another active duty

member, a retiree, or a deceased active

duty member or retiree, dual eligibility,

that is, entitlement to direct care from

the Uniformed Services medical care

system and CHAMPUS is the result.

Since the active duty status is primary,

and it is the intent that all medical care

be provided an active duty member

through the Uniformed Services medical

care system, CHAMPUS eligibility is

terminated as of 12:01 a.m. on the day

following the day the dual eligibility

begins. However, any dependent

children in a marriage of two active

duty persons or of an active duty

member and a retiree, are CHAMPUS

eligible in the same manner as

dependent children of a marriage

involving only one CHAMPUS sponsor.

Should a spouse or dependent who has

dual eligibility leave active duty status,

that person’s CHAMPUS eligibility is

reinstated as of 12:01 a.m. of the day

active duty ends, if he or she otherwise

is eligible as a dependent of a

CHAMPUS sponsors.

Note to paragraph (d): No CHAMPUS

eligibility arises as the result of the marriage

of two active duty members.

(e) Eligibility under the Transitional

Assistance Management Program

(TAMP). Transitional health care

benefits under CHAMPUS are

authorized for the applicable time

period described as follows for:

(1) Up to thirty (30) days or until

again covered by an employersponsored health plan, whichever

occurs earlier, following release from

active duty for:

(i) Activated Guard/Reserve and their

dependents;

(ii) Involuntary stop-loss and their

dependents; and

(iii) Voluntary stop-loss and their

dependents; and

(iv) Members who accepted Voluntary

Separation Incentives (VSI).

(2) Sixty (60) days for regular DoD

military and their dependents when the

sponsor is involuntarily separated with

less than six years of active service.

Involuntary separation must occur

during the five year period beginning

October 1, 1990.

(3) One hundred twenty (120) days for

regular military and their dependents

when the sponsor is involuntarily

separated with six or more years of

active service. Involuntary separation

must occur during the five year period

beginning October 1, 1990. Each branch

of service will determine eligibility,

including dates, for its members and

their dependents and provide data to

DEERS.

(f) Changes in status which result in

termination of CHAMPUS eligibility.

Changes in status which result in a loss

of CHAMPUS eligibility as of 12:01 a.m.

of the day following the day the event

occurred, unless otherwise indicated,

are as follows:

(1) Changes in the status of a member.

(i) When an active duty member’s

period of active duty ends, excluding

retirement or death.

(ii) When an active duty member is

placed on desertion status (eligibility is

reinstated when the active duty member

is removed from desertion status and

returned to military control).

Note to paragraph (f)(1): A member serving

a sentence of confinement in conjunction

with a sentence of punitive discharge is still

considered on active duty until such time as

the discharge is executed.

(2) Changes in the status of a retiree.

(i) When a retiree ceases to be entitled

to retired, retainer, or equivalent pay for

any reason, the retiree’s dependents lose

their eligibility unless the dependent is

otherwise eligible (e.g., some former

spouses, some dependents who are

victims of abuse and some incapacitated

children as outlined in paragraph

(b)(2)(ii)(H)(2) of this section).

(ii) A retiree also loses eligibility

when no longer entitled to retired,

retainer, or equivalent pay.

Note to paragraph (f)(2): A retiree who

waives his or her retired, retainer or

equivalent pay is still considered a retiree for

the purposes of CHAMPUS eligibility.

(3) Changes in the status of a

dependent. (i) Divorce, except for

certain classes of former spouses as

provided in paragraph (b)(2)(i) of this

section and the member or former

member’s own children (i.e., legitimate,

adopted, and judicially determined

illegitimate children).

Note to paragraph (f)(3)(i): An unadopted

stepchild loses eligibility as of 12:01 a.m. of

the day following the day the divorce

becomes final.

(ii) Annulment, except for certain

classes of former spouse as provided in

paragraph (b)(2)(i) of this section and

the member or former member’s own

children (i.e., legitimate, adopted, and

judicially determined illegitimate

children).

Note to paragraph (f)(3)(ii): An unadopted

stepchild loses eligibility as of 12:01 a.m. of

the day following the day the annulment

becomes final.

(iii) Adoption, except for adoptions

occurring after the death of a member or

former member.

(iv) Marriage of a child, except when

the marriage is terminated by death,

divorce, or annulment before the child

is 21 or 23 if an incapacitated child as

provided in paragraph (b)(2)(ii)(H)(2) of

this section.

(v) Marriage of a widow or widower,

except for the child of the widow or

widower who was the stepchild of the

deceased member or former member at

the time of death. The stepchild

continues CHAMPUS eligibility as other

classes of dependent children.

(vi) Attainment of entitlement to

hospital insurance benefits (Part A)

under Medicare except as provided in

paragraphs (f)(3)(viii) and (f)(3)(ix) of

this section. (This also applies to

individuals living outside the United

States where Medicare benefits are not

available).

(vii) Attainment of age 65, except for

dependents of active duty member’s and

beneficiaries not eligible for Part A

Medicare. CHAMPUS eligibility is lost

at 12:01 a.m. on the last day of the

month preceding the month of

attainment of age 65.

Note to paragraph (f)(3)(vii): If the person

is not eligible for Part A of Medicare, he or

she must file a Social Security
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67029

Administration ‘‘Notice of Disallowance’’

certifying to that fact with the Uniformed

Service responsible for the issuance of his or

her identification card so a new card showing

CHAMPUS eligibility can be issued.

Individuals who lose their CHAMPUS

eligibility because they have reached the age

limitation or were eligible for Part A,

Medicare cannot be reinstated under

CHAMPUS. Additionally, individuals

entitled only to supplementary medical

insurance (Part B) of Medicare, but not Part

A, or Part A through the Premium HI

provisions (provided for under the 1972

Amendments to the Social Security Act,

retain eligibility under CHAMPUS (refer to

§ 199.8 of this part for additional information

when a double coverage situation is

involved).

(vii) End stage renal disease.

Medicare coverage begins with the third

month after the month a course of

maintenance dialysis begins, or with the

first month of dialysis if the individual

participates in a self-dialysis training

program during the 3-month waiting

period, or with the month in which a

patient enters the hospital to prepare to

receive a transplant (providing the

transplant is performed within the

following 2 months). If a transplant is

delayed more than 2 months after the

preparatory hospitalization, Medicare

coverage will begin with the second

month prior to the month of transplant.

All beneficiaries, except dependents of

active duty members, lose their

CHAMPUS eligibility when Medicare

coverage becomes available to a person

because of chronic renal disease unless

the following conditions have been met.

CHAMPUS eligibility will continue if:

(A) The individual is under 65 years

old;

(B) The individual became eligible for

Medicare under the provisions of 42

U.S.C. 426–1(a);

(C) The individual is enrolled in Part

B of Medicare; and

(D) The individual has applied and

qualified for continued CHAMPUS

eligibility through the Defense

Eligibility Enrollment System (DEERS).

(ix) Individuals with certain

disabilities. Each case relating to

Medicare eligibility resulting from being

disabled requires individual

investigation. All beneficiaries except

dependents of active duty members lose

their CHAMPUS eligibility when

Medicare coverage becomes available to

a disabled person unless the following

conditions have been met. CHAMPUS

eligibility will continue if:

(A) The individual is under 65 years

old;

(B) The individual became eligible for

Medicare under the provisions of 42

U.S.C. 426(b)(2);

(C) The individual is enrolled in Part

B of Medicare; and

(D) The individual has applied and

qualified for continued CHAMPUS

eligibility through the Defense

Eligibility Enrollment System (DEERS).

(x) Disabled students, that is children

age 21 or 22, who are pursuing a fulltime course of higher education and

who, either during the school year or

between semesters, suffer a disabling

illness or injury with resultant inability

to resume attendance at the institution

remain eligibility for CHAMPUS

medical benefits for 6 months after the

disability is removed or until the

student passes his or her 23rd birthday,

whichever occurs first. However, if

recovery occurs before the 23rd birthday

and there is resumption of a full-time

course of higher education, CHAMPUS

benefits can be continued until the 23rd

birthday. The normal vacation periods

during an established school year do not

change the eligibility status of a

dependent child 21 or 22 years old in

a full time student status. Unless an

incapacitating condition existed before,

and at the time of, a dependent child’s

21st birthday, a dependent child 21 or

22 years old in student status does not

have eligibility and may not qualify for

eligibility under the requirements

related to mental or physical incapacity

as described in paragraph (b)(2)(ii)(H)(2)

of this section.

(g) Reinstatement of CHAMPUS

eligibility. Circumstances which result

in reinstatement of CHAMPUS

eligibility are as follows:

(1) End stage renal disease. Medicare

coverage ceases for end stage renal

disease patients with the 36th month

after the month in which a successful

kidney transplant takes place or with

the 12th month after the month in

which the course of maintenance

dialysis ends. Unless CHAMPUS

eligibility has been continued under

paragraph (f)(3)(viii) of the section, at

this point CHAMPUS eligibility resumes

if the person is otherwise still eligible.

He or she is required to take action to

be reinstated as a CHAMPUS

beneficiary and to obtain a new

identification card.

(2) Disability. Some disabilities are

permanent, others temporary. Each case

must be reviewed individually. Unless

CHAMPUS eligibility has been

continued under paragraph (f)(3)(ix) of

this section, when disability ends and

Medicare eligibility ceases, CHAMPUS

eligibility resumes if the person is

otherwise still eligible. Again, he or she

is required to take action to obtain a

new CHAMPUS identification card.

(h) Determination of eligibility status.

Determination of an individual’s

eligibility as a CHAMPUS beneficiary is

the primary responsibility of the

Uniformed Service in which the

member or former member is, or was, a

member, or in the case of dependents of

a NATO military member, the Service

that sponsors the NATO member. For

the purpose of program integrity, the

appropriate Uniformed Service shall,

upon request of the Director,

OCHAMPUS, review the eligibility of a

specific person when there is reason to

question the eligibility status. In such

cases, a report on the results of the

review and any action taken will be

submitted to the Director, OCHAMPUS,

or a designee.

(i) Procedures for determination of

eligibility. Procedures for the

determination of eligibility are

prescribed within the Department of

Defense Instruction 1000.13 available at

local military facilities personnel

offices.

(j) CHAMPUS procedures for

verification of eligibility. (1) Eligibility

for CHAMPUS benefits will be verified

through the Defense Enrollment

Eligibility Reporting System (DEERS)

maintained by the Uniformed Services,

except for abused dependents as set

forth in paragraph (b)(2)(iii) of this

section. It is the responsibility of the

CHAMPUS beneficiary, or parent, or

legal representative, when appropriate,

to provide the necessary evidence

required for entry into the DEERS file to

establish CHAMPUS eligibility and to

ensure that all changes in status that

may affect eligibility be reported

immediately to the appropriate

Uniformed Service for action.

(2) Ineligibility for CHAMPUS

benefits may be presumed in the

absence of prescribed eligibility

evidence in the DEERS file.

(3) The Director, OCHAMPUS, shall

issue guidelines as necessary to

implement the provisions of this

section.

4. Section 199.4 is amended by

revising paragraphs (e)(5)(iii)(B), (f)(1),

(f)(2) heading and introductory text,

(f)(2)(ii), (f)(2)(iii), (f)(2)(iv), (f)(3)

heading and introductory text, (f)(3)(i),

(f)(3)(iii), (f)(4) introductory text and

(f)(4)(ii) to read as follows:

§ 199.4 Basic program benefits.

* * * * *

(e) * * *

(5) * * *

(iii) * * *

(B) In most instances, for costs related

to kidney transplants, Medicare (not

CHAMPUS) benefits will be applicable.

If a CHAMPUS beneficiary participates

as a kidney donor for a Medicare

beneficiary, Medicare will pay for

expenses in connection with the kidney

transplant to include all reasonable
67030 Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules

preparatory, operation and

postoperation recovery expenses

associated with the donation

(postoperative recovery expenses are

limited to the actual period of recovery).

(See § 199.3 of this part for additional

information on end stage renal disease.)

* * * * *

(f) * * *

(1) General. As stated in paragraph (a)

of this section, the Basic Program is

essentially a supplemental program to

the Uniformed Services direct medical

care system. To encourage use of the

Uniformed Services direct medical care

system wherever its facilities are

available and appropriate, the Basic

Program benefits are designed so that it

is to the financial advantage of a

CHAMPUS beneficiary or sponsor to use

the direct medical care system. When

medical care is received from civilian

sources, a CHAMPUS beneficiary is

responsible for payment of certain

deductible and cost-sharing amounts in

connection with otherwise covered

services and supplies. By statute, this

joint financial responsibility between

the beneficiary or sponsor and

CHAMPUS is more favorable for

dependents of members than for other

classes of beneficiaries.

(2) Dependents of members of the

Uniformed Services. CHAMPUS

beneficiary or sponsor liability set forth

for dependents of members is as

follows:

* * * * *

(ii) Inpatient cost-sharing. Dependents

of members of the Uniformed Services

are responsible for the payment of the

first $25 of the allowable institutional

costs incurred with each covered

inpatient admission to a hospital or

other authorized institutional provider

(refer to § 199.6 of this part), or the

amount the beneficiary or sponsor

would have been charged had the

inpatient care been provided in a

Uniformed Service hospital, whichever

is greater.

(iii) Outpatient cost-sharing.

Dependents of members of the

Uniformed Services are responsible for

payment of 20 percent of the

CHAMPUS-determined allowable cost

or charge beyond the annual fiscal year

deductible amount (as described in

paragraph (f)(2)(i) of this section) for

otherwise covered services or supplies

provided on an outpatient basis by

authorized providers.

(iv) Ambulatory surgery.

Notwithstanding the above positions

pertaining to outpatient cost-sharing,

dependents of members of the

Uniformed Services are responsible for

payment of $25 for surgical care that is

authorized and received while in an

outpatient status and that has been

designated in guidelines issued by the

Director, OCHAMPUS, or a designee.

* * * * *

(3) Former members and dependents

of former members. CHAMPUS

beneficiary liability set forth for former

members and dependents of former

members is as follows:

(i) Annual fiscal year deductible for

outpatient services or supplies. The

annual fiscal year deductible for

otherwise covered outpatient services or

supplies provided former members and

dependents of former members is the

same as the annual fiscal year outpatient

deductible applicable to dependents of

active duty members of rank E–5 or

above (refer to paragraph (f)(2)(i) (A) or

(B) of this section).

* * * * *

(iii) Outpatient cost-sharing. Former

members and dependents of former

members are responsible for payment of

25 percent of the CHAMPUSdetermined allowable costs or charges

beyond the annual fiscal year deductible

amount (as described in paragraph

(f)(2)(i) of this section) for otherwise

covered services or supplies provided

on an outpatient basis by authorized

providers.

* * * * *

(4) Former spouses. CHAMPUS

beneficiary liability for former spouses

eligible under the provisions set forth in

§ 199.3 of this part is as follows:

* * * * *

(ii) Inpatient cost-sharing. Eligible

former spouses are responsible for

payment of cost-sharing amounts the

same as those required for former

members and dependents of former

members.

* * * * *

6. Section 199.8 is amended by

revising paragraphs (a) and (d)(1) to read

as follows.

§ 199.8 Double coverage.

(a) Introduction. (1) in enacting

CHAMPUS legislation, Congress clearly

has intended that CHAMPUS be the

secondary payer to all health benefit

and insurance plans. 10 U.S.C.

1079(j)(1) specifically provides:

A benefit may not be paid under a plan

[CHAMPUS] covered by this section in the

case of a person enrolled in or covered by

any other insurance, medical service, or

health plan to the extent that the benefit also

is a benefit under the other plan, except in

the case of a plan [Medicaid] administered

under title 19 of the Social Security Act (42

U.S.C. 1396, et seq.).

(2) The provision in paragraph (a)(1)

of this section is made applicable

specifically to retired members,

dependents, and survivors by 10 U.S.C.

1086(d). The underlying intent, in

addition to preventing waste of Federal

resources, is to ensure that CHAMPUS

beneficiaries receive maximum benefits

while ensuring that the combined

payments of CHAMPUS and other

health benefit and insurance plans do

not exceed the total charges.

* * * * *

(d) * * *

(1) CHAMPUS and Medicare. Under

certain circumstances a CHAMPUS

beneficiary can also be eligible for

Medicare. In any double coverage

situation involving Medicare, Medicare

is always the primary payer. When Part

A, ‘‘Hospital Insurance,’’ of Medicare is

involved, the Medicare ‘‘lifetime

reserve’’ benefit must be used before

CHAMPUS benefits may be used. The

procedures to be followed for these

circumstances are as follows.

(i) Dependents of active duty

members. For dependents of active duty

members, payment will be determined

in accordance with paragraph (c) of this

section.

(ii) Medicare end stage renal disease

beneficiaries. In any case involving a

Medicare end stage renal disease

beneficiary as provided in

§ 199.3(f)(3)(viii), CHAMPUS secondary

payments will be determined in

accordance with paragraph (c) of this

section.

(iii) Medicare disabled beneficiaries.

In any case involving a Medicare

disabled beneficiary as provided in

§ 199.3(f)(3)(ix), CHAMPUS payment is

determined in accordance with

paragraph (c) of this section.

* * * * *

7. Section 199.20 is amended by

adding paragraph (d)(1)(iv) to read as

follows.

§ 199.20 Continued Health Care Benefit

Program (CHCBP).

* * * * *

(d) * * *

(1) * * *

(iv) An unmarried person who:

(A) Is placed in the legal custody of

a member of former member by a court

or who is placed in the home of a

member or former member by a

recognized placement agency in

anticipation of the legal adoption of the

child; and

(B) Either:

(1) Has not attained the age of 21 if

not in school or age 23 if enrolled in a

full time course of study at an

institution of higher learning; or

(2) Is incapable of self-support

because of a mental or physical

incapacity which occurred while the
Federal Register / Vol. 62, No. 246 / Tuesday, December 23, 1997 / Proposed Rules 67031

person was considered a dependent of

the member or former member; and

(C) Is dependent on the member or

former member for over one-half of the

person’s support; and

(D) Resides with the members or

former member unless separated by the

necessity of military service or to

receive institutional care as a result of

disability or incapacitation; and

(E) Is not a dependent of a member or

former member as described in § 199.3

(b)(2).

Dated: December 15, 1997.

L.M. Bynum,

Alternate OSD Federal Register Liaison

Officer, Department of Defense.

[FR Doc. 97–33111 Filed 12–22–97; 8:45 am]

BILLING CODE 5000–04–M

DEPARTMENT OF TRANSPORTATION

Coast Guard

33 CFR Parts 62 and 66

[USCG 97 3112, CGD 97–018]

RIN 2115–AF45

Merger of the Uniform State Waterways

Marking System With the United States

Aids to Navigation System

AGENCY: Coast Guard, DOT.

ACTION: Notice of proposed rulemaking.

SUMMARY: The Coast Guard proposes a

five year phased-in merger of the

Uniform State Waterway Marking

System with the United States Aids to

Navigation System. This proposed

merger would eliminate distinctions

between these two systems and create

safer, less confusing waterways.

DATES: Comments are requested by

February 23, 1998.

ADDRESSES: You may mail comments to

the Docket Management Facility,

[USCG–97–3112], U.S. Department of

Transportation, Room PL–401, 400

Seventh Street SW., Washington, DC

20590–0001, or deliver them to room

PL–401, located on the Plaza Level of

the Nassif Building at the same address

between 10 a.m. and 5 p.m., Monday

through Friday, except Federal holidays.

The telephone number is (202) 366–

9329.

The Docket Management Facility

maintains the public docket for this

rulemaking. Comments, and documents

as indicated in this preamble, will

become part of this docket and will be

available for inspection or copying at

room PL–401, located on the Plaza Level

of the Nassif Building at the above

address between 9:30 a.m. and 2 p.m.,

Monday through Friday, except Federal

holidays.

FOR FURTHER INFORMATION CONTACT:

Paulette Twine, Chief, Documentary

Services Division, U.S. Department of

Transportation, telephone (202) 366–

9329 or Dan Andrusiak, Short Range

Aids to Navigation Division, USCG

Headquarters, Telephone: (202) 267–

0327.

SUPPLEMENTARY INFORMATION:

Request for Comments

The Coast Guard encourages your

participation in this rulemaking by the

submission of written data, views, or

arguments. Your comments should

include your name and address, and

identify this rulemaking [USCG–97–

3112] and the specific section of this

notice of proposed rulemaking to which

each comment applies, along with the

reason for each comment. Please submit

two copies of all comments and

attachments in an unbound format, no

larger than 81⁄2 by 11 inches, suitable for

copying and electronic filing to the DOT

Docket Management Facility at the

address under ADDRESSES. If you want

acknowledgment of receipt of your

comment, enclose a stamped, selfaddressed postcard or envelope.

The Coast Guard will consider all

comments received during the comment

period and may change this proposed

rule in view of the comments.

The Coast Guard plans no public

hearing. You may request a public

hearing by submitting a request to the

address under ADDRESSES. The request

should include the reasons a hearing

would be beneficial. If the Coast Guard

determines that the opportunity for oral

presentations will aid this rulemaking,

it will hold a public hearing at a time

and place announced by a later notice

in the Federal Register.

Background and Purpose

The Uniform State Waterways

Marking System (USWMS), 33 CFR

66.10, prescribes regulatory markers and

aids to navigation that may mark

navigable waters that the Commandant

designates as state waters in accordance

with 33 CFR 66.05–5. The USWMS may

also mark the non-navigable internal

waters of a state.

The United States Aids to Navigation

System (USATONS), 33 CFR 62,

prescribes regulatory markers and aids

to navigation that mark navigable waters

of the United States. Navigable waters,

defined by 33 CFR 2.02–25, include

territorial seas and internal waters that

have been or can be used for interstate

commerce, either by themselves or in

connection with other waterways.

Section 66.10–1(b), allows the use of

USATONS on state and non-navigable

internal waters, and many states already

use the USATONS instead of the

USWMS.

In 1992, the National Association of

State Boating Law Administrators

(NASBLA) passed a resolution

requesting that the Coast Guard:

1. Change the meaning of the red and

white striped buoy from the USWMS

meaning of obstruction to the

USATONS meaning of safewater;

2. Change the black USWMS buoy to

the green USATONS buoy, and

3. Use a phased-in implementation

period for these changes.

NASBLA requested these changes

because they believe the current

USWMS markings, which are different

from the USATONS markings, confuse

boaters and could cause casualties.

In 1993, NASBLA’s Law Enforcement

& Uniform Boating Laws Committee

conducted a survey concerning the

differences between the USWMS and

the USATONS. The survey focused on

the red and white striped buoy and the

green versus black buoy. Of the 42 states

that responded to the survey, 11 states

indicated that they use the red and

white striped buoy as defined by the

USWMS, 15 states indicated that they

use the USWMS’s black buoy, and 35

states indicated that the USWMS should

reflect the same characteristics as the

USATONS.

On December 29, 1995, the Coast

Guard published an advanced notice of

proposed rulemaking (CGD 94–091) (60

FR 67345) to gauge public opinion

toward conforming the USWMS with

the USATONS. On March 27, 1996, a

notice of proposed rulemaking was

published (61 FR 13472) that, among

other things, proposed eliminating the

USWMS. The Coast Guard received

adverse comments from ten states. Many

of the comments stated concerns that

elimination of the USWMS would

eliminate regulatory markers and would

cause the states to bear the costs of

purchasing aids and revising boating

manuals. As a result of these comments,

the Coast Guard removed the proposal

to eliminate the USWMS from the final

rule. The Coast Guard then contacted

the NASBLA and each state that

commented and discussed their

concerns.

Apart from the two distinctions

explained above, a Coast Guard

comparison of the USWMS and the

USATONS showed that almost all of the

requirements of the USWMS are

contained in the USATONS. The

differences between the two systems

are:

1. The USMWS has the additional

requirement of orange bands on

regulatory buoys;