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[Federal Register Volume 76, Number 54 (Monday, March 21, 2011)]
[Notices]
[Pages 15316-15320]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2011-6565]

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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-2318-N]
RIN 0938-AQ42

Medicaid Program; State Allotments for Payment of Medicare Part B 
Premiums for Qualifying Individuals: Federal Fiscal Year 2010 and 
Federal Fiscal Year 2011

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Notice.

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SUMMARY: This notice contains charts providing the States' final 
allotments available to pay the Medicare Part B premiums for Qualifying 
Individuals (QIs) for the Federal fiscal year (FY) 2010 and the 
preliminary QI allotments for FY 2011. The amounts of these QI 
allotments were determined in accordance with the methodology set forth 
in regulations and reflect funding for the QI program made available 
under recent legislation.

DATES: Effective dates: This notice is effective on February 25, 2011. 
The final QI allotments for payment of Medicare Part B premiums for FY 
2010 are effective October 1, 2009. The preliminary QI allotments for 
FY 2011 are effective October 1, 2010.

FOR FURTHER INFORMATION CONTACT: Richard Strauss, (410) 786-2019.

SUPPLEMENTARY INFORMATION:

I. Background

A. Allotments for FY 2010

    Section 111 of the Medicare Improvements for Patients and Providers 
Act of 2008 (MIPPA) (Pub. L. 110-275) and section 2 of the QI Program 
Supplemental Funding Act of 2008 (the SFA) (Pub. L. 110-379) provided 
$480 million for FY 2009 and $150 million for the first quarter of FY 
2010 (that is, through December 31, 2009). Section 5005 of the American 
Recovery and Reinvestment Act of 2009 (ARRA, Pub. L. 111-5, enacted on 
February 17, 2009) extended the QI program by providing $412.5 million 
in additional funds for the remaining three quarters of FY 2010 and 
$150 million in funds for the first quarter of 2011 (that is, through 
December 31, 2010).
    Most recently with respect to funding for the QI program for FY 
2010, section 3 of the ``Emergency Aid to American Survivors of the 
Haiti Earthquake Act'' enacted on January 27, 2010 (Haiti Earthquake 
Act, Pub. L. 111-127) amended section 1933(g)(2)(M) of the Social 
Security Act (the Act) to provide an additional $50 million in funding 
for States' FY 2010 QI allotments. Prior to enactment of the Haiti 
Earthquake Act, there was only $562.5 million available for States' FY 
2010 QI allotments. Under the current Medicaid statute, as amended by 
the Haiti Earthquake Act, a total of $612.5 million is available for 
States' QI program in FY 2010.

B. Allotments for FY 2011 and Thereafter

    As previously stated, section 5005 of the American Recovery and 
Reinvestment Act of 2009 (ARRA, Pub. L. 111-5, enacted on February 17, 
2009) extended the QI program by providing $150 million in additional 
funds for the first quarter of FY 2011 (that is, through December 31, 
2010). Section 3 of the ``Emergency Aid to American Survivors of the 
Haiti Earthquake Act'' enacted on January 27, 2010 (Haiti Earthquake 
Act, Pub. L. 111-127) amended section 1933(g)(2)(M) of the Social 
Security Act (the Act) and provided an additional $15 million for 
States' FY 2011 QI allotments; that brings the total funds available 
for the QI program in FY 2011 to $165 million. Most recently, section 
110 of the Medicare and Medicaid Extenders Act of 2010 (Pub. L. 111-
309, enacted on December 15, 2010) amended section 1933 of the Social 
Security Act and provides for $720 million for the QI program in FY 
2011 in addition to the currently available $165 million for a total of 
$885 million available for funding the QI program for FY 2011. Finally, 
the Medicare and Medicaid Extenders Act of 2010 (Pub. L. 111-309) also 
made available $280 million for the QI program for the first quarter of 
FY 2012 (that is, through December 31, 2011).

C. Current Regulations and Methodology for Calculating the Fiscal Year 
QI Allotments

    The amounts of the final FY 2010 and preliminary FY 2011 QI 
allotments, as contained in this notice, were determined in accordance 
with the methodology set forth in existing regulations at 42 CFR 
433.10(c)(5), as amended in the Federal Register published on November 
24, 2008 (73 FR 70893), and reflecting funding for the QI program made 
available under the legislation discussed above.

II. Charts

    The final QI allotments for FY 2010 and the preliminary QI 
allotments for FY 2011 are shown by State in Chart 1 and Chart 2 below, 
respectively:

Chart 1--Final Qualifying Individuals Allotments for October 1, 2009 
through September 30, 2010
Chart 2--Preliminary Qualifying Individuals Allotments for October 1, 
2010 through September 30, 2011

    The following describes the information contained in the columns of 
Chart 1 and Chart 2:
    Column A--State. Column A shows the name of each State.
    Columns B through D show the determination of an Initial QI 
Allotment for FY 2010 (Chart 1) or FY 2011 (Chart 2) for each State, 
based only on the indicated Census Bureau data.
    Column B--Number of Individuals. Column B contains the estimated 
average number of Medicare beneficiaries for each State that are not 
covered by Medicaid whose family income is at least 120 but less than 
135 percent of the federal poverty level. With respect to the final FY 
2010 QI allotment (Chart 1), Column B contains the number of such 
individuals for the years 2006 through 2008, as obtained from the 
Census Bureau's Annual Social and Economic Supplement to the 2009 
Current Population Survey. With respect to the preliminary FY 2011 QI

[[Page 15317]]

allotment (Chart 2), Column B contains the number of such individuals 
for the years 2007 through 2009, as obtained from the Census Bureau's 
Annual Social and Economic Supplement to the 2010 Current Population 
Survey.
    Column C--Percentage of Total. Column C provides the percentage of 
the total number of individuals for each State, that is, the Number of 
Individuals for the State in Column B divided by the sum total of the 
Number of Individuals for all States in Column B.
    Column D--Initial QI Allotment. Column D contains each State's 
Initial QI Allotment for FY 2010 (Chart 1) or FY 2011 (Chart 2), 
calculated as the State's Percentage of Total in Column C multiplied by 
the total amount available Nationally for QI allotments for the fiscal 
year. The total amount available Nationally for QI allotments each 
fiscal year is $612,500,000 for FY 2010 (Chart 1) and $885,000,000 for 
FY 2011 (Chart 2).
    Columns E through L show the determination of the States' Final QI 
Allotments for FY 2010 (Chart 1) or Preliminary QI Allotments for FY 
2011 (Chart 2).
    Column E--FY 2010 Estimated QI Expenditures. Column E contains the 
States' estimates of their total QI expenditures for FY 2010 (Chart 1) 
or FY 2011 (Chart 2) based on information obtained from States in the 
summer of 2010.
    Column F--Need (Difference). Column F contains the additional 
amount of QI allotment needed for those States whose estimated 
expenditures in Column E exceeded their Initial QI allotments in Column 
D for FY 2010 (Chart 1) or for FY 2011 (Chart 2) for such States, 
Column F shows the amount in Column E minus the amount in Column D. For 
other ``Non-Need'' States, Column F shows ``NA''.
    Column G--Percent of Total Need States. For States whose projected 
QI expenditures in Column E are greater than their initial QI allotment 
in Column D for FY 2010 (Chart 1) or FY 2011 (Chart 2), respectively, 
Column G shows the percentage of total need, determined as the amount 
for each Need State in Column F divided by the sum of the amounts for 
all States in Column F. For Non-Need States, the entry in Column G is 
``NA''.
    Column H--Reduction Pool for Non-Need States. Column H shows the 
amount of the pool of surplus QI allotments for FY 2010 (Chart 1) or FY 
2011 (Chart 2), respectively, for those States that project QI 
expenditures for the fiscal year that are less than the Initial QI 
allotment for the fiscal year (referred to as non-need States). For 
States whose estimates of QI expenditures for FY 2010 or FY 2011, 
respectively, in Column E are equal to or less than their Initial FY 
2010 or FY 2011 QI allotments in Column D for FY 2010 or FY 2011, 
Column H shows the amount in Column D minus the amount in Column E. For 
the States with a need, Column H shows ``Need''. The reduction pool of 
excess QI allotments is equal to the sum of the amounts in Column H.
    Column I--Percent of Total Non-Need States. For States whose 
projected QI expenditures in Column E are less than their Initial QI 
allotment in Column D for FY 2010 (Chart 1) or FY 2011 (Chart 2), 
Column I shows the percentage of the total reduction pool in Column H, 
determined as the amount for each Non-Need State in Column H divided by 
the sum of the amounts for all States in Column H. For Need States, the 
entry in Column I is ``Need''.
    Column J--Reduction Adjustment for Non-Need States. Column J shows 
the amount of adjustment needed to reduce the Initial QI allotments in 
Column D for FY 2010 (Chart 1) or FY 2011 (Chart 2) for Non-Need States 
in order to address the total need shown in Column F. The amount in 
Column J is determined as the percentage in column I for Non-Need 
States multiplied by the lesser of the total need in Column F (equal to 
the sum of Needs in Column F) or the total Reduction Pool in Column H 
(equal to the sum of the Non-Need amounts in Column H). For Need 
States, the entry in Column J is ``Need''.
    Column K--Increase Adjustment for Need States.
    Column K shows the amount of adjustment to increase the Initial QI 
Allotment in Column D for FY 2010 (Chart 1) or FY 2011 (Chart 2) for 
Need States in order to address the total need shown for the fiscal 
year in Column F. The amount in Column K is determined as the 
percentage in Column G for Need States multiplied by the lesser of the 
total need in Column F (equal to the sum of Needs in Column F) or the 
total Reduction Pool in Column H (equal to the sum of the Non-Need 
amounts in Column H). For Non-Need States, the entry in Column K is 
``NA''.
    Column L--Final FY 2010 QI Allotment (Chart 1) or Preliminary FY 
2011 QI Allotment (Chart 2).
    Column L contains the Final QI Allotment for each State for FY 2010 
(Chart 1) or the Preliminary QI Allotment for FY 2011 (Chart 2). For 
States that need additional QI allotment amounts for the fiscal year 
based on Estimated QI Expenditures in Column E as compared to their 
Initial QI allotments in Column D for the fiscal year (States with a 
projected need amount are shown in Column F), Column L is equal to the 
Initial QI allotment in Column D for FY 2010 (Chart 1) or FY 2011 
(Chart 2) plus the amount determined in Column K for Need States. For 
Non-Need States (States with a projected surplus in Column H), Column L 
is equal to the QI Allotment in Column D reduced by the Reduction 
Adjustment amount in Column J.
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III. Waiver of Notice With Comment and 30-Day Delay in Effective Date

    We ordinarily publish a notice of proposed rulemaking in the 
Federal Register and invite public comment on a proposed rule. The 
notice of proposed rulemaking includes a reference to the legal 
authority under which the rule is proposed, and the terms and substance 
of the proposed rule, or a description of the subjects and issues 
involved. This procedure can be waived, however, if an agency finds 
good cause that a notice-and-comment procedure is impracticable, 
unnecessary, or contrary to the public interest, and incorporates a 
statement of the finding and its reasons in the rule issued. In 
addition, we also normally provide a delay of 30 days in the effective 
date. However, if adherence to this procedure would be impractical, 
unnecessary, or contrary to public interest, we may waive the delay in 
the effective date in accordance with the Administrative Procedure Act 
(5 U.S.C. 551 et seq.).
    We are publishing this notice without a comment period or delay in 
effective date because of the need to notify individual States of the 
limitations on Federal funds for their Medicaid expenditures for 
payment of Medicare Part B premiums for qualifying individuals. Some 
States have

[[Page 15320]]

experienced deficits in their current allotments that have caused them 
to deny benefits to eligible applicants, while other States project a 
surplus in their allotments. This notice adjusts the allocation of 
Federal funds, which will reduce the impact of States denying coverage 
to eligible QIs when there is sufficient funding to cover all or some 
of these individuals. Because access to Medicare Part B coverage for 
QIs, who without this coverage would have difficulty paying for needed 
health care, is critically important, we believe that it is in the 
public interest to waive the usual notice and comment procedure which 
we undertake before making a rule final. Moreover, we are not making 
any changes to the process we use for allocating allotments. We are 
simply implementing a process already set forth in regulations. For 
these reasons, we also believe a notice and comment process would be 
unnecessary.
    Therefore, for the reasons discussed above, we find that good cause 
exists to dispense with the normal requirement that a notice cannot 
become effective any earlier than 30 days after its publication. States 
that will have access to additional funds for QIs need to know that 
these funds are available as soon as possible. While we believe the 
surplus States that will have diminished amounts available for this FY 
will have sufficient funds for enrolling all potential QIs in their 
States, they also need to know as soon as possible that a certain 
amount of their unused allocation will no longer be available to them 
for this FY.

IV. Collection of Information Requirements

    This document does not impose information collection and 
recordkeeping requirements. Consequently, it need not be reviewed by 
the Office of Management and Budget under the authority of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 35).

V. Regulatory Impact Statement

    We have examined the impact of this notice as required by Executive 
Order 12866 (September 1993, Regulatory Planning and Review), the 
Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-354), 
section 1102(b) of the Social Security Act, the Unfunded Mandates 
Reform Act of 1995 (Pub. L. 104-4), and Executive Order 13132 on 
Federalism and the Congressional Review Act (5 U.S.C. 804(2)).
    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, if regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety 
effects, distributive impacts, and equity). A regulatory impact 
analysis (RIA) must be prepared for major rules with economically 
significant effects ($100 million or more in any one year). This notice 
does not reach the economic threshold and thus is not considered a 
major rule.
    The RFA requires agencies to analyze options for regulatory relief 
for small businesses. For purposes of the RFA, small entities include 
small businesses, nonprofit organizations, and small governmental 
jurisdictions. Most hospitals and most other providers and suppliers 
are small entities, either by nonprofit status or by having revenues of 
$7 million to $34.5 million in any one year. Individuals and States are 
not included in the definition of a small entity.
    This notice codifies our procedures for implementing provisions of 
the Balanced Budget Act of 1997 to allocate, among the States, Federal 
funds to provide Medicaid payment for Medicare Part B premiums for low-
income Medicare beneficiaries. The total amount of Federal funds 
available during a Federal fiscal year and the formula for determining 
individual State allotments are specified in the law. We have applied 
the statutory formula for the State allotments. Because the data 
specified in the law were not initially available, we used comparable 
data from the U.S. Census Bureau on the number of possible qualifying 
individuals in the States. This notice also permits, in a specific 
circumstance, reallocation of funds to enable enrollment of all 
eligible individuals to the extent of the available funding.
    We believe that the statutory provisions implemented in this notice 
will have a positive effect on States and individuals. Federal funding 
at the 100 percent matching rate is available for Medicare cost-sharing 
for Medicare Part B premium payments for qualifying individuals and, 
with the reallocation of the State allotments, a greater number of low-
income Medicare beneficiaries will be eligible to have their Medicare 
Part B premiums paid under Medicaid. The changes in allotments will not 
result in fewer individuals receiving the QI benefit in any State. The 
FY 2010 and FY 2011 costs for this provision have been included in the 
Mid-session Review of the FY 2011 President's Budget.
    Section 1102(b) of the Social Security Act requires us to prepare a 
regulatory impact analysis for any rule that may have a significant 
impact on the operations of a substantial number of small rural 
hospitals. The analysis must conform to the provisions of section 604 
of the RFA. For purposes of section 1102(b) of the Act, we define a 
small rural hospital as a hospital that is located outside of a 
metropolitan statistical area and has fewer than 100 beds.
    We are not preparing analyses for either the RFA or section 1102(b) 
of the Act because we have determined and certify that this notice will 
not have a significant economic impact on a substantial number of small 
entities or a significant impact on the operations of a substantial 
number of small rural hospitals.
    Section 202 of the Unfunded Mandates Reform Act of 1995 also 
requires that agencies assess anticipated costs and benefits before 
issuing any rule that may result in expenditure in any one year by 
State, local, or tribal governments, in the aggregate, or by the 
private sector, of $130 million. This notice will have no consequential 
effect on the governments mentioned or on the private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates a rule that imposes substantial 
direct requirement costs on State and local governments, preempts State 
law, or otherwise has federalism implications. Since this notice does 
not impose any costs on State or local governments, the requirements of 
E.O. 13132 are not applicable.
    In accordance with the provisions of Executive Order 12866, this 
notice was not reviewed by the Office of Management and Budget.

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program)

    Dated: February 9, 2011.
Donald M. Berwick,
Administrator, Centers for Medicare & Medicaid Services.
    Dated: February 28, 2011
Kathleen Sebelius,
Secretary.
[FR Doc. 2011-6565 Filed 3-18-11; 8:45 am]
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