        DEPARTMENT OF HEALTH AND HUMAN SERVICES
        Indian Health Service
        42 CFR Part 136
        RIN 0905AC97
        Catastrophic Health Emergency Fund

          AGENCY:
          Indian Health Service, HHS.

          ACTION:
          Proposed rule.

          SUMMARY:

          The Indian Health Service (IHS) administers the Catastrophic Health Emergency Fund, The purpose of CHEF is to meet the extraordinary medical costs associated with the treatment of victims of disasters or catastrophic illnesses who are within the responsibility of the Service. This proposed rule: Proposes definitions governing the CHEF; establishes that a Service Unit shall not be eligible for reimbursement for the cost of treatment until the episode of care's cost has reached a certain threshold; establishes a procedure for reimbursement for certain services exceeding a threshold cost; establishes a procedure for payment for certain cases; and, establishes a procedure to ensure payment will not be made from CHEF if other sources of payment (Federal, state, local, private) are available.

          DATES:
          To be assured consideration, written comments must be received at the address below, no later than 5 p.m. on March 11, 2016. The IHS Area and program offices will send copies of this notice to each Tribe within their jurisdiction.

          ADDRESSES:
          In commenting, please refer to file code 0905AC97. Because of staff and resource limitations, we cannot accept comments by facsimile (FAX) transmission. You may submit comments in one of four ways (please choose only one of the ways listed):

            1. Electronically. You may submit electronic comments on this regulation to http://www.regulations.gov. Follow the “Submit a Comment” instructions.

            2. By regular mail. You may mail written comments to the following address only: Betty Gould, Regulations Officer, Indian Health Service, Office of Management Services, Division of Regulatory Affairs, 5600 Fishers Lane, Mailstop: 09E70, Rockville, Maryland 20857.
          Please allow sufficient time for mailed comments to be received before the close of the comment period.

            3. By express or overnight mail. You may send written comments to the above address.

            4. By hand or courier. If you prefer, you may deliver (by hand or courier) your written comments before the close of the comment period to the address above.
          If you intend to deliver your comments to the Rockville address, please call telephone number (301) 443-1116 in advance to schedule your arrival with one of our staff members.
          Comments will be made available for public inspection at the Rockville address from 8:30 a.m. to 5:00 p.m., Monday-Friday, two weeks after publication of this notice.

          FOR FURTHER INFORMATION CONTACT:
          Carl Harper, Director, Office of Resource Access and Partnerships, Indian Health Service, 5600 Fishers Lane, Mailstop: 10E85C, Rockville, Maryland 20857, Telephone (301) 443-1553.

        SUPPLEMENTARY INFORMATION:

          Inspection of Public Comments: All comments received before the close of the comment period are available for viewing by the public, including any personally identifiable or confidential business information that is included in a comment. We post all comments as soon as possible after they have been received to the following Web site: http://www.regulations.gov. Follow the search instructions on the Web site to view public comments.
        I. Background
        The purpose of CHEF is to meet the extraordinary medical costs associated with the treatment of victims of disasters or catastrophic illnesses who are within the responsibility of the Service. IHS administers CHEF to reimburse certain IHS and Tribal purchased/referred care (PRC) costs that exceed the cost threshold. Although CHEF was first established in 1988, a similar fund was authorized by Public Law 99-591, a Joint Resolution continuing appropriations for fiscal year (FY) 1987. IHS developed operating guidelines in August of 1987, which were approved by the Office of Management and Budget (OMB) for the management of CHEF. Those guidelines were developed with input from Tribal organizations and IHS personnel who work with the daily processing and management of Contract Health Services (CHS), now known as the Purchased/Referred Care (PRC) Program. Congress passed the Indian Health Care Improvement Reauthorization and Extension Act of 2009, S. 1790, 111th Cong. (2010) (IHCIREA), as section 10221(a) of the Patient Protection and Affordable Care Act, Public Law 111-148. Through IHCIREA, Congress permanently reauthorized and amended the Indian Health Care Improvement Act (IHCIA), Public Law 94-437. Section 202 of IHCIA [25 U.S.C. 1621a] establishes CHEF and directs the IHS to promulgate regulations for its administration. The operating guidelines and twenty-eight (28) years of experience (FYs 1987-2015) contributed to the design of this regulation.
        II. Provisions of This Proposed Regulation
        This regulation proposes to (1) establish definitions governing CHEF, including definitions of disasters and catastrophic illnesses; (2) establish that a Service Unit shall not be eligible for reimbursement for the cost of treatment from CHEF until its cost of treating any victim of such catastrophic illness or disaster has reached a certain threshold cost; (3) establish a procedure for reimbursement of the portion of the costs for authorized services that exceed such threshold costs; (4) establish a procedure for payment from CHEF for cases in which the exigencies of the medical circumstances warrant treatment prior to the authorization of such treatment; and, (5) establish a procedure that will ensure no payment will be made from CHEF to a Service Unit to the extent the provider of services is eligible to receive payment for the treatment from any other Federal, State, local, or private source of reimbursement for which the patient is eligible.

        No part of CHEF, or its administration, shall be subject to contract or grant under any law, including the Indian Self-Determination and Education Assistance Act (ISDEAA), Public Law 93-638 [25 U.S.C. 450 et seq.] and may not be allocated, apportioned, or delegated to a Service Unit, Area Office, or any other organizational unit. Accordingly, the IHS Division of Contract Care within the Office of Resource Access and Partnerships at Headquarters shall remain responsible for administration of CHEF.
        A. Definitions
        IHS proposes establishing the following definitions for governing CHEF, including definitions of disasters and catastrophic illnesses:

        1. Alternate Resources—any Federal, State, Tribal, local, or private source of coverage for which the patient is eligible. Such resources include health care providers and institutions and health care programs for the payment of health services including but not limited to programs under titles XVIII or XIX of the Social Security Act (i.e., Medicare and Medicaid), other Federal health care programs, State, Tribal or local health care programs, Veterans Health Administration, and private insurance, including Tribal self-insurance.
        2. Catastrophic Health Emergency Fund (CHEF)—the fund established by Congress to reimburse extraordinary medical expenses incurred for catastrophic illnesses and disasters covered by a PRC program of the IHS, whether such program is carried out by IHS or an Indian Tribe or Tribal organization under the Indian Self-Determination and Education Assistance Act.

        3. Catastrophic Illness—a medical condition that is costly by virtue of the intensity and/or duration of its treatment. Examples of conditions that frequently require multiple hospital stays and extensive treatment are cancer, burns, premature births, cardiac disease, end-stage renal disease, strokes, trauma-related cases such as automobile accidents and gunshot wounds, and some mental disorders. CHEF is intended to shield IHS and Tribal PRC operations from financial disruption caused by the intensity of high cost illnesses and/or events.
        4. Disasters—situations that pose a significant level of threat to life or health or cause loss of life or health stemming from events such as tornadoes, earthquakes, floods, catastrophic accidents, epidemics, fires, and explosions.
        5. Episode of Care—the period of consecutive days for a discrete health condition during which reasonable and necessary medical services related to the condition occur.
        6. Purchased/Referred Care (PRC)—any health service that is—
        (a) delivered based on a referral by, or at the expense of, an Indian health program; and
        (b) provided by a public or private medical provider or hospital which is not a provider or hospital of the IHS health program.
        7. Service Unit—an administrative entity of the Service or a Tribal health program through which services are provided, directly or by contract, to eligible Indians within a defined geographic area.
        8. Threshold Cost—the designated amount above which incurred medical costs will be considered for CHEF reimbursement after a review of the authorized expenses and diagnosis.
        B. Threshold Cost
        IHCIA section 202 provides that a Service Unit shall not be eligible for reimbursement from CHEF until its cost of treating any victim of a catastrophic illness or event has reached a certain threshold cost. The Secretary is directed to establish the initial CHEF threshold at—
        (1) the FY 2000 level of $19,000; and
        (2) for any subsequent year, the threshold will not be less than the threshold cost of the previous year increased by the percentage increase in the medical care expenditure category of the Consumer Price Index (CPI) for all urban consumers (United States city average) for the 12-month period ending with December of the previous year.
        IHS intends to set the initial threshold governed by this rule at $19,000 for FY 2016. In reaching this determination, IHS adopted the recommendation of the IHS Director's Workgroup on Improving PRC. The Workgroup, composed of Tribal leaders and Tribal and Federal representatives, voted 18-2 to recommend $19,000 as the initial threshold. For this recommendation, the Workgroup considered several factors, including (1) Tribal concerns regarding the lower threshold and the potential to exhaust CHEF earlier in the FY leaving PRC programs without the ability to recover costs for treating victims of catastrophic illnesses or disasters; and, (2) Tribal concerns about setting the threshold at the FY 2000 level and then applying the CPI for each year since FY 2000, which would have resulted in a $30,000 plus threshold requirement by FY 2013. At this higher level, PRC programs with limited budgets would be unable to access the CHEF to seek recovery for extraordinary medical costs. Accordingly, IHS intends to set the initial threshold at $19,000 for FY 2016, with increases in subsequent years based on the annual Consumer Price Index.
        C. Compliance With PRC Regulations
        IHS proposes to follow PRC regulations 42 CFR part 136 for payment from CHEF. For example, payment or reimbursement from CHEF may be made for the costs of treating persons eligible for PRC in accordance with 42 CFR 136.23 and authorized for PRC in accordance with 42 CFR 136.24. In cases where the exigencies of the medical circumstances warrant treatment prior to the authorization of such treatment by the Service Unit, authorization must be obtained in accordance with 42 CFR 136.24(c). For example, claims for reimbursement of services provided that do not meet the 72 hour emergency notification requirements found at 42 CFR 136.24(c) will be denied. The applicable Area PRC program shall review CHEF requests for CHEF reimbursement to ensure consistency with PRC regulations.
        D. Alternate Resources
        In accordance with section 202(d)(5) of IHCIA [25 U.S.C. 1621a (d)(5)], alternate resources must be exhausted before reimbursement is made from CHEF. No reimbursement shall be made from CHEF to any Service Unit to the extent the patient is eligible to receive payment for treatment from any other Federal, State, Tribal, local, or private source of reimbursement. Medical expenses incurred for catastrophic illnesses and events will not be considered eligible for reimbursement if they are payable by alternate resources, as determined by IHS, whether or not such resources actually make payment. IHS is the payor of last resort and, if the provider of services is eligible to receive payment from other resources, the medical expenses are only payable by PRC and reimbursable by CHEF to the extent IHS would not consider the other resources to be “alternate resources” under the applicable regulations and IHS policy. Expenses paid by alternate resources are not eligible for payment by PRC or reimbursement by CHEF. However, if the patient becomes eligible for alternate resources, the Service Unit shall return all funds reimbursed from CHEF to the Headquarters CHEF account.
        E. Reimbursement Procedure
        A patient must be eligible for PRC services and the Service Unit must adhere to regulations (42 CFR 136.23(a) through (f)) governing the PRC program to be reimbursed for catastrophic cases from CHEF. Once the catastrophic case meets the threshold requirement and the Service Unit has authorized PRC resources exceeding the threshold requirement, the Service Unit may qualify for reimbursement from CHEF. Reimbursable costs are those costs that exceed the threshold requirement after payment has been made by all alternate resources such as Federal, State, Tribal, local, private insurance, and other resources. Reimbursement of PRC expenditures incurred by the Service Unit and approved by the PRC program at Headquarters will be processed through the respective IHS Area Office. Reimbursement from CHEF shall be subject to availability of funds.
        F. Recovery of CHEF Reimbursement Funds
        In the event a PRC program has been reimbursed from CHEF for an episode of care and that same episode of care becomes eligible for and is paid by any Federal, State, Tribal, local, or private source (including third party insurance), the PRC program shall return all CHEF funds received for that episode of care to the CHEF at IHS Headquarters. These recovered CHEF funds will be used to reimburse other valid CHEF requests.
        III. Collection of Information Requirements
        Prior to implementing the rule, IHS may be required to develop new information collection forms that would require approval from the Office of Management and Budget in accordance with the Paperwork Reduction Act of 1995, 44 United States Code 3507(d).
        IV. Response to Comments

        Because of the large number of public comments we normally receive on Federal Register documents, we are not able to acknowledge or respond to them individually. We will consider all comments received by the date and time specified in the DATES section of this preamble, and, when we proceed with a final rule, we will respond to the comments in the preamble to that rule.
        V. Regulatory Impact Analysis
        We have examined the impacts of this rule as required by Executive Order (E.O.) 12866 on Regulatory Planning and Review (September 30, 1993); section 603 of the Regulatory Flexibility Act (RFA), Public Law 96-354 [5 U.S.C. 601-612], as amended by subtitle D of the Small Business Regulatory Fairness Act of 1996, Public Law 104-121; the Unfunded Mandates Reform Act (UMRA) of 1995, Public Law 104-4; E.O. 13132 on Federalism (August 4, 1999); the Congressional Review Act [5 U.S.C. 804(2)]; and E.O. 13175 Consultation and Coordination with Indian Tribal Governments.
        A. E.O. 12866
        E.O. 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). In accordance with E.O. 12866, Agencies must submit a regulatory impact analysis for those regulatory actions that are “significant” within the meaning of “economically significant.” A regulatory action is economically significant if it is anticipated to “(1) have an annual effect on the economy of $100 million or more” or (2) to “adversely affect in a material way the economy, a sector of the economy, productivity, competition, jobs, the environment, public health or safety, or State, local, or Tribal governments or communities.” This rule is not being treated as a “significant regulatory action” under section 3(f) of E.O. 12866. Accordingly, the rule has not been reviewed by the Office of Management and Budget.
        B. Regulatory Flexibility Act (RFA)
        RFA requires analysis of regulatory options that minimize any significant economic impact of a rule on small entities, unless it is certified that the proposed rule is not expected to have a significant economic impact on small entities. This rule is not expected to have a significant economic impact on small entities.
        C. Unfunded Mandates Reform Act (UMRA)
        Section 202 of UMRA (Pub. L. 104-4) requires an assessment of anticipated costs and benefits before proposing any rule that may result in expenditure by State, local, and Tribal governments, in aggregate, or by the private sector of $100 million in any one year. We have determined that this rule is consistent with the principles set forth in the executive orders and in these statutes and find that this rule will not have an effect on the economy that exceeds $100 million in any one year. The IHS FY 2015 annual appropriation for CHEF was $51.5 million. This final rule is not anticipated to have an effect on State, local, or Tribal governments in the aggregate, or by the private sector of $100 million or more. This rule does not impose any new costs on small entities, and it will not result in a significant economic impact on a substantial number of small entities. Thus, no further analysis is required.
        D. Federalism
        E.O. 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. We have reviewed this proposed rule under the threshold criteria of E.O. 13132 and have determined that this proposed rule would not have substantial direct effect on the States, on the relationship between the Federal Government and the States, or on the distribution of power and governmental responsibilities among the various levels of the government(s). As this rule has no Federal implications, a Federalism summary impact statement is not required.
        E. Congressional Review Act
        This rule is not a “major rule” as defined by 5 U.S.C. 804(2)—it does not or is not likely to result in:
        (1) An annual effect on the economy of $100,000,000 or more;
        (2) a major increase in costs or prices for consumers, individual industries, Federal, State, or local government agencies, or geographic regions; or
        (3) significant adverse effects on competition, employment, investment, productivity, innovation, or on the ability of United States-based enterprises to compete with foreign-based enterprises in domestic and export markets. The term does not include any rule promulgated under the Telecommunications Act of 1996 and the amendments made by that Act.
        F. E.O. 13175 Consultation and Coordination With Indian Tribal Governments
        This rule has Tribal implications under E.O. 13175, Consultation and Coordination with Indian Tribal Governments, because it would have a substantial direct and positive effect on one or more Indian Tribes.
        These guidelines were developed with input from Tribes and IHS personnel who work with the daily processing and management of PRC resources. The IHS Director's Workgroup on Improving PRC met and discussed these guidelines on October 12-13, 2010, and June 1-2, 2011, in Denver, Colorado, and on January 11-12, 2012, in Albuquerque, New Mexico. Based on the recommendation of the Workgroup the threshold amount of $19,000 is proposed to be established for the current fiscal year. This proposed rule serves as Tribal consultation with affected Tribes by giving interested Tribes the opportunity to comment on the regulation before it is finalized. In addition, IHS issued “Dear Tribal Leader” letters related to the development of these regulations on February 9, 2011, and May 6, 2013. IHS intends to consult as fully as possible with Tribes prior to the publication of a final rule.

          List of Subjects in 42 CFR Part 136
          Alaska Natives, Contract Health Services, Health, Health facilities, Health service delivery areas, Indians.

          Dated: November 10, 2015.
          Robert G. McSwain,
          Principal Deputy Director, Indian Health Service.
          Dated: January 11, 2016.
          Sylvia M. Burwell,
          Secretary, Health and Human Services.

        For the reasons set out in the preamble, the Indian Health Service proposes to amend 42 CFR chapter I as set forth below:

          PART 136—INDIAN HEALTH

        1. The authority citation for part 136 is revised to read as follows:

          Authority:
          42 U.S.C. 2001 and 2003; 25 U.S.C. 13; and 25 U.S.C 1621a.

        2. Add new subpart L consisting of §§ 136.501-136.509 to read as follows:

            Subpart L—Indian Catastrophic Health Emergency Fund
            Sec.
            136.501
            Definitions.
            136.502
            Purpose of the regulations.

            136.503
            Threshold cost.
            136.504
            Reimbursement procedure.
            136.505
            Reimbursable services.
            136.506
            Alternate resources.
            136.507
            Program integrity.
            136.508
            Recovery of reimbursement funds.
            136.509
            Reconsideration and appeals.

          Subpart L—Indian Catastrophic Health Emergency Fund

            § 136.501
            Definitions.
            As used in this subpart:

              Alternate Resource means any Federal, State, Tribal, local, or private source of reimbursement for which the patient is eligible. Such resources include health care providers and institutions and health care programs for the payment of health services including but not limited to programs under titles XVIII or XIX of the Social Security Act (i.e., Medicare and Medicaid), other Federal health care programs, State, Tribal or local health care programs, Veterans Health Administration, and private insurance.

              Catastrophic Health Emergency Fund (CHEF) means the fund created by Congress to cover extraordinary medical expenses incurred for catastrophic illnesses and disasters covered by a purchased/referred care (PRC) program of the Indian Health Service (IHS), whether such program is carried out by IHS or an Indian Tribe or Tribal organization under the Indian Self-Determination and Education Assistance Act.

              Catastrophic Illness refers to a medical condition that is costly by virtue of the intensity and/or duration of its treatment. Examples of conditions that frequently require multiple hospital stays and extensive treatment are cancer, burns, premature births, cardiac disease, end-stage renal disease, strokes, trauma-related cases such as automobile accidents, and gunshot wounds, and some mental disorders. CHEF is intended to shield IHS and Tribal PRC operations from financial disruption caused by the intensity of high cost illnesses and/or events.

              Disaster means a situation which poses a significant level of threat to life or health or causes loss of life or health stemming from events such as tornadoes, earthquakes, floods, catastrophic accidents, epidemics, fires, and explosions.

              Episode of Care means the period of consecutive days for a discrete health condition during which reasonable and necessary medical services related to the condition occur.

              Purchased/Referred Care means any health service that is—
            (1) Delivered based on a referral by, or at the expense of, an Indian health program; and
            (2) Provided by a public or private medical provider or hospital which is not a provider or hospital of the Indian health program.

              Service Unit means an administrative entity of the Service or a Tribal health program through which services are provided, directly or by contract, to eligible Indians within a defined geographic area.

              Threshold Cost means the designated amount above which incurred medical costs will be considered for CHEF reimbursement after a review of the authorized expenses and diagnosis.

            § 136.502
            Purpose of the regulations.
            (a) The Indian Catastrophic Health Emergency Fund (hereafter referred to as “CHEF”) is authorized by section 202 of the Indian Health Care Improvement Act (IHCIA) [25 U.S.C. 1621a]. CHEF is administered by the Secretary, Department of Health and Human Services (HHS) (“the Secretary”) acting through the Headquarters of the Indian Health Service (IHS) (“the Service”), solely for the purpose of meeting extraordinary medical costs associated with treatment of victims of disasters or catastrophic illnesses who are within the responsibility of the Service.
            (b) These regulations:
            (1) Establish definitions of terms governing CHEF, including definitions of disasters and catastrophic illnesses for which the cost of treatment provided under contract would qualify for payment from CHEF;
            (2) Establish a threshold level for reimbursement for the cost of treatment;
            (3) Establish procedures for reimbursement of the portion of the costs incurred by Service Units that exceeds such threshold costs, including procedures for when the exigencies of the medical circumstances warrant treatment prior to the authorization of such treatment by the Service; and
            (4) Establish procedures for reimbursements pending the outcome or payment by alternate resources.

            § 136.503
            Threshold cost.
            A Service Unit shall not be eligible for reimbursement from CHEF until its cost of treating any victim of a catastrophic illness or disaster for an episode of care has reached a certain threshold cost.
            (a) The threshold cost shall be established at the level of $19,000.

            (b) The threshold cost in subsequent years shall be calculated from the threshold cost of the previous year, increased by the percentage increase in the medical care expenditure category of the Consumer Price Index for all urban consumers (United States city average) for the 12-month period ending with December of the previous year. The revised threshold costs shall be published yearly in the Federal Register.

            § 136.504
            Reimbursement procedure.
            Service Units whose scope of work and funding include the purchase of medical services from private or public vendors under PRC are eligible to participate. CHEF payments shall be based only on valid PRC expenditures, including expenditures for exigent medical circumstances without prior PRC authorization. Reimbursement from CHEF will not be made if applicable PRC requirements are not followed.
            (a) Claim Submission. Requests for reimbursement from CHEF must be submitted to the appropriate IHS Area Office. Area PRC programs will review requests for reimbursement to ensure compliance with PRC requirements, including but not limited to: Patient eligibility, medical necessity, notification requirements for emergent and non-emergent care, medical priorities, allowable expenditures, and eligibility for alternate resources.
            (b) Content of Claims. All claims submitted for reimbursement must include:
            (1) A fully completed Catastrophic Health Emergency Fund Reimbursement Request Form.
            (2) A statement of the provider's charges in paper form. The paper form must comply with the format required for the submission of claims under title XVIII of the Social Security Act. For example, charges may be printed on forms such as the Centers for Medicare & Medicaid Services (CMS) 1450, American Dental Association (ADA) dental claim form, CMS 1500, or National Council for Prescription Drug Program (NCPDP) universal claim forms. The forms submitted for review must include specific appropriate diagnostic and procedure codes.
            (3) An explanation of benefits or statement of payment identifying how much was paid to the provider by the Service Unit for the Catastrophic Illness or Disaster. Payments to the patient or any other entity are ineligible for CHEF reimbursement.

            (4) The Division of Contract Care may request additional medical documentation describing the medical treatment or service provided, including but not limited to discharge summaries and/or medical progress notes. Cases may be submitted for 50% reimbursement of eligible expenses pending discharge summaries. Medical documentation must be received to close the CHEF case.
            (c) Limitation of Funds and Reimbursement Procedure. Because of the limitations of funds, full reimbursement cannot be guaranteed on all requests and will be based on the availability of funds at the time IHS processes the claim. To the extent funds are available, CHEF funds may not be used to cover the cost of services or treatment for which the funds were not approved. Unused funds, including but not limited to, funds unused due to overestimates, alternate resources, and cancellations must be returned to CHEF.

            § 136.505
            Reimbursable services.
            The costs of catastrophic illnesses and disasters for distinct episodes of care are eligible for reimbursement from CHEF in accordance with the medical priorities of the Service. Only services that are related to a distinct episode of care will be eligible for reimbursement.
            (a) Some of the services that may qualify for reimbursement from the fund are:
            (1) Emergency treatment.
            (2) Emergent and acute inpatient hospitalization.
            (3) Ambulance services; air and ground (including patient escort travel costs).
            (4) Attending and consultant physician.
            (5) Functionally required reconstructive surgery.
            (6) Prostheses and other related items.
            (7) Reasonable rehabilitative therapy exclusive of custodial care not to exceed 30 days after discharge.
            (8) Skilled nursing care when the patient is discharged from the acute process to a skilled nursing facility.
            (b) Reserved.

            § 136.506
            Alternate resources.
            (a) Expenses paid by alternate resources are not eligible for payment by PRC or reimbursement by CHEF. No payment shall be made from CHEF to any Service Unit to the extent that the provider of services is eligible to receive payment for the treatment from any other Federal, State, Tribal, local, or private source of reimbursement for which the patient is eligible. A patient shall be considered eligible for such resources and no payment shall be made from CHEF if:
            (1) The patient is eligible for alternate resources, or
            (2) The patient would be eligible for alternate resources if he or she were to apply for them, or
            (3) The patient would be eligible for alternate resources under Federal, State, Tribal or local law or regulation but for the patient's eligibility for PRC, or other health services, from the Indian Health Service or Indian Health Service funded programs.
            (b) The determination of whether a resource constitutes an alternate resource for the purpose of CHEF reimbursement shall be made by the Headquarters of the Indian Health Service, irrespective of whether the resource was determined to be an alternate resource at the time of PRC payment.

            § 136.507
            Program integrity.
            (a) All CHEF records and documents will be subject to review by the respective Area and by Headquarters.
            (b) Internal audits and administrative reviews may be conducted as necessary to ensure compliance with PRC regulations and CHEF policies.

            § 136.508
            Recovery of reimbursement funds.
            In the event a Service Unit has been reimbursed from CHEF for an episode of care and that same episode of care becomes eligible for and is paid by any Federal, State, Tribal, local, or private source (including third party insurance) the Service Unit shall return all CHEF funds received for that episode of care to the CHEF at IHS Headquarters. These recovered CHEF funds will be used to reimburse other valid CHEF requests.

            § 136.509
            Reconsideration and appeals.
            (a) Any Service Unit to whom payment from CHEF is denied will be notified of the denial in writing together with a statement of the reason for the denial. In order to seek review of the denial decision, the Service Unit must follow the procedures set forth in paragraphs (b) and (c) of this section.
            (b) Within 30 days from the receipt of the denial provided in paragraph (a) the Service Unit may submit a request in writing for reconsideration of the original denial to the Division of Contract Care. The request for reconsideration must include, as applicable, corrections to the original claim submission necessary to overcome the denial; or a statement and supporting documentation establishing that the original denial was in error. If no additional information is submitted the original denial will stand.
            (c) If the original decision is affirmed on reconsideration, the Service Unit will be notified in writing and advised that an appeal may be taken to the Director, Indian Health Service, within 30 days of receipt of the denial. The appeal shall be in writing and shall set forth the grounds supporting the appeal. The decision of the Director, Indian Health Service, shall constitute the final administrative action.

      [FR Doc. 2016-01138 Filed 1-25-16; 8:45 am]
      BILLING CODE 4165-16-P


        DEPARTMENT OF COMMERCE
        National Oceanic and Atmospheric Administration
        50 CFR Part 622
        [Docket No. 190927-0047]
        RIN 0648-BI83
        Fisheries of the Caribbean, Gulf of Mexico, and South Atlantic; Coastal Migratory Pelagics Resources in the Gulf of Mexico and Atlantic Region; Framework Amendment 7

          AGENCY:
          National Marine Fisheries Service (NMFS), National Oceanic and Atmospheric Administration (NOAA), Commerce.

          ACTION:
          Proposed rule; request for comments.

          SUMMARY:
          NMFS proposes to implement management measures described in Framework Amendment 7 to the Fishery Management Plan (FMP) for Coastal Migratory Pelagic (CMP) Resources of the Gulf of Mexico (Gulf) and Atlantic Region (FMP) (Framework Amendment 7), as prepared by the Gulf of Mexico Fishery Management Council (Gulf Council). This proposed rule would revise the commercial and recreational minimum size limit for the Gulf zone of the Gulf migratory group of cobia (Gulf cobia). The purpose of this proposed rule is to reduce harvest of Gulf cobia in the Gulf zone in response to concerns about the status of the stock until additional stock information becomes available.

          DATES:
          Written comments must be received by November 4, 2019.

          ADDRESSES:
          You may submit comments on the proposed rule, identified by “NOAA-NMFS-2019-0036,” by either of the following methods:
          • Electronic submission: Submit all electronic public comments via the Federal e-Rulemaking Portal: http://www.regulations.gov. Go to www.regulations.gov/#!docketDetail;D=NOAA-NMFS-2019-0036 click the “Comment Now!” icon, complete the required fields, and enter or attach your comments.
          • Mail: Submit written comments to Rich Malinowski, NMFS Southeast Regional Office, 263 13th Avenue South, St. Petersburg, FL 33701.
          • Instructions: Comments sent by any other method, to any other address or individual, or received after the end of the comment period, may not be considered by NMFS. All comments received are a part of the public record and will generally be posted for public viewing on www.regulations.gov without change. All personal identifying information (e.g., name, address, etc.), confidential business information, or otherwise sensitive information submitted voluntarily by the sender will be publicly accessible. NMFS will accept anonymous comments (enter “N/A” in required fields if you wish to remain anonymous).

          Electronic copies Framework Amendment 7 that contain an environmental assessment and a Regulatory Flexibility Act (RFA) analysis may be obtained from the Southeast Regional Office website at https://www.fisheries.noaa.gov/action/modifications-gulf-mexico-migratory-group-cobia-size-and-possession-limits.

          FOR FURTHER INFORMATION CONTACT:

          Rich Malinowski, NMFS Southeast Regional Office, telephone: 727-824-5305, or email: rich.malinowski@noaa.gov.

        SUPPLEMENTARY INFORMATION:
        The CMP fishery in the Gulf and Atlantic region is jointly managed by the Gulf Council and the South Atlantic Fishery Management Council (South Atlantic Council) (Councils) under the FMP, and includes king mackerel, Spanish mackerel, and Gulf cobia. The FMP was prepared by the Councils and is implemented by NMFS through regulations at 50 CFR part 622 under authority of the Magnuson-Stevens Fishery Conservation and Management Act (Magnuson-Stevens Act). Under the FMP, each Council can develop individual framework amendments to the FMP for actions that are specific to that Council's jurisdiction.
        Background
        Two migratory groups of cobia exist in the southeastern US: the Atlantic migratory group and the Gulf migratory group. The Atlantic migratory group ranges from Georgia through New York and is managed by the Atlantic States Marine Fisheries Commission (84 FR 4736, February 19, 2019). The Gulf migratory group ranges in the Gulf from Texas through Florida and in the Atlantic off the east coast of Florida. The Gulf migratory group is further divided into the Gulf zone and the Florida east coast zone. The Gulf zone is defined as encompassing an area of the exclusive economic zone (EEZ) north of a line extending east of the United States/Mexico border, and north and west of the line of demarcation between the Atlantic Ocean and the Gulf (the Councils' boundary) (50 CFR 622.369(c)(1)(i)). The Florida east coast zone encompasses an area of the EEZ south and east of the line of demarcation between the Atlantic Ocean and the Gulf, and south of a line extending due east from the Florida/Georgia border (50 CFR 622.369(c)(1)(ii)).
        Within the Gulf migratory group, the Gulf Council is responsible for management in the Gulf zone, and the South Atlantic Council is responsible for management in the Florida east coast zone. Framework Amendment 7 is only applicable to the Gulf zone for Gulf cobia. The South Atlantic Council is not presently considering management changes to the Florida east coast zone.
        The most recent stock assessment of Gulf cobia (SEDAR 28 2013) determined that Gulf cobia is not overfished and is not undergoing overfishing. The Gulf Council's Scientific and Statistical Committee (SSC) accepted the stock assessment for management advice. The Gulf Council's SSC recommended the overfishing limit and acceptable biological catch levels for the entire Gulf cobia stock, including the Florida east coast zone, based on the results of the SEDAR 28 (2013) stock assessment. Subsequently, Amendment 20B to the FMP implemented the two zones for Gulf cobia as well as annual catch targets (ACT) and annual catch limits (ACL) for each zone (80 FR 4216, January 27, 2015).
        Within the Gulf zone, Gulf cobia is managed using a stock ACT (quota) and ACL, among other measures. There are no sector-specific allocations for the commercial and recreational sectors. Landings of Gulf cobia from the Gulf zone remained relatively consistent from 2012 through 2016; however, a decrease in landings was observed in 2017. During the 2018 June and August Gulf Council meetings fishers provided public testimony that they were witnessing a decrease in the presence of Gulf cobia in the Gulf zone, and requested that the Gulf Council address concerns about the potential health of the Gulf cobia stock in the Gulf zone. Landings of Gulf zone cobia from 2018, which became available following the Gulf Council's transmittal of Framework Amendment 7, revealed that 2018 landings did in fact continue to decline from previous years. These public comments were primarily from charter vessel and headboat operators, and private angling stakeholders. Recreational landings account for greater than 90 percent of all Gulf zone cobia landings.

        The minimum size limit for Gulf cobia in both the Gulf and South Atlantic is 33 inches (83.8 cm), fork length, and has been in effect since the implementation of the original CMP FMP in 1983 (48 FR 5270, February 4, 1983). This minimum size limit applies to both sectors, and corresponds with the length at which life history information indicates that 50 percent of cobia are sexually mature (sexes combined) and capable of reproduction (SEDAR 28 2013). The current daily Federal possession limit of two fish per person per day for both sectors has been in effect since Amendment 5 to the FMP was implemented in 1990 (55 FR 29370, July 19, 1990). The Gulf Council intends Framework Amendment 7 to take a precautionary approach. Although the 2013 stock assessment (SEDAR 28 2013) did not indicate that Gulf cobia are overfished or undergoing overfishing, the Gulf Council decided to reduce fishing mortality in response to constituent concerns, in case the decrease in landings observed in 2017 indicates an unknown issue with the health of the stock. The management measures considered in Framework 7 do not reflect those adopted for Atlantic cobia, because the Atlantic and Gulf cobia are separate and genetically distinct stocks with different growth, recruitment, and migratory patterns. Atlantic cobia can reach similar sizes as Gulf cobia, but do so over a longer lifespan (approximately 15 years compared to 11 years for Gulf cobia). Therefore, management measures appropriate for Atlantic cobia may not be appropriate for Gulf cobia.
        As a result of recent decreases in landings and concerns about declining landings expressed by stakeholders, the Gulf Council decided to explore options for reducing fishing mortality of Gulf cobia in the Gulf zone at its April 2018 meeting. Framework Amendment 7 includes alternatives to revise the Gulf zone minimum size limit, as well as the possession limit, prior to the completion of the next stock assessment. This stock assessment is scheduled to begin in late 2019, and is expected to be available to the Gulf Council and their SSC in late 2020.
        Management Measure Contained in This Proposed Rule
        This proposed rule to implement Framework Amendment 7 would increase the commercial and recreational minimum size limit for Gulf cobia in the Gulf zone. The Gulf zone commercial and recreational minimum size limit would be increased from 33 inches (83.8 cm), fork length, to 36 inches (91.4 cm), fork length. The Gulf Council determined that increasing the minimum size limit to 36 inches (91.4 cm), fork length, would reduce fishing mortality by requiring fishers to release all Gulf cobia in the Gulf zone that are less than the minimum size limit. Raising the minimum size limit would accordingly increase the probability of a sexually mature Gulf zone cobia being able to spawn before being harvested, resulting in positive biological effects for the stock in the form of additional recruitment to the spawning stock over time. Harvest is expected to be reduced by 10.3 percent for the commercial sector, and 26.1 percent for the recreational sector, as a result of increasing the minimum size limit.
        Measure Contained in Framework Amendment 7 Not in This Proposed Rule
        In addition to the action in Framework 7 and this proposed rule to increase the Gulf zone cobia minimum size limit, Framework Amendment 7 also contains an action with alternatives to revise the possession limit for cobia in the Gulf zone by reducing the individual possession limit and/or creating vessel limits. As described in 50 CFR 622.383(b), the current possession limit for Gulf cobia is two fish per person per day in or from the Gulf EEZ, regardless of the number of trips or duration of a trip.
        At its October 2018 meeting, the Gulf Council decided to retain the current possession limit, because there was public opposition to the action and comparatively less of a reduction in fishing mortality from a possession limit than raising the minimum size limit. The Council determined that the reduction in harvest predicted as a result of the proposed increase in the minimum size limit (10.3 percent for the commercial sector and 26.1 percent for the recreational sector) would be sufficiently protective until the next planned stock assessment for the entire Gulf cobia stock is available in late 2020.
        Classification
        Pursuant to section 304(b)(1)(A) of the Magnuson-Stevens Act, the NMFS Assistant Administrator has determined that this proposed rule is consistent with Framework Amendment 7, the FMP, the Magnuson-Stevens Act, and other applicable laws, subject to further consideration after public comment.
        This proposed rule has been determined to be not significant for purposes of Executive Order 12866.

        NMFS prepared an initial regulatory flexibility analysis (IRFA) for this proposed rule, as required by section 603 of the RFA (5 U.S.C. 603). The IRFA describes the economic impact this proposed rule, if adopted, would have on small entities. A description of this proposed rule, why it is being considered, and the objectives of this proposed rule are contained in the preamble. The Magnuson-Stevens Act provides the statutory basis for this proposed rule. A copy of the full analysis is available from NMFS (see ADDRESSES). A summary of the IRFA follows.

        This proposed rule, if implemented, would apply to all commercial vessels, charter vessels and headboats (for-hire vessels), and recreational anglers that fish for or harvest cobia in the Gulf zone. Because no Federal permit is required for the commercial harvest or sale of Gulf cobia, the distinction between commercial and recreational fishing activity for the purposes of this proposed rule is whether the fish are sold. Individuals that harvest Gulf cobia under the recreational possession limit in Federal waters and who do not subsequently sell these fish are considered to be recreational anglers. The RFA does not consider recreational anglers to be small entities, so they are outside the scope of this analysis and only the impacts on businesses that engage in commercial fishing (i.e., those that sell their harvests of Gulf cobia) will be discussed.
        For-hire vessels sell fishing services to recreational anglers. The proposed changes to the FMP would not directly alter the services sold by these for-hire vessels. Any change in anglers' demand for these fishing services (and associated economic effects) as a result of this proposed rule would be secondary to any direct effect on anglers and, therefore, would be an indirect effect of this proposed rule. Indirect effects are not germane to the RFA; however, because for-hire captains and crew are allowed to harvest and sell Gulf cobia under the possession limit when the commercial season is open, for-hire businesses, or employees thereof, could be directly affected by this proposed rule as well.

        Although no Federal permit is required for the commercial harvest and sale of Gulf cobia, vessels with other Federal commercial permits are required to report their catches for all species harvested, including Gulf cobia. On average from 2013 through 2017, there were 277 federally permitted commercial vessels with reported landings of cobia in the Gulf zone. Their average annual vessel-level revenue from all species for 2013 through 2017 was approximately $184,000 (2017 dollars) and cobia harvested from the Gulf zone accounted for less than one percent of this revenue. The maximum annual revenue from all species reported by a single one of these vessels from 2013 through 2017 was approximately $2.28 million (2017 dollars). Finally, it is unknown how many non-federally permitted vessels may have fished commercially for Gulf cobia in Federal waters during this time.
        For-hire vessels in the Gulf are required to have a limited access Gulf Charter Vessel/Headboat for Coastal Migratory Pelagics permit (Gulf CMP for-hire permit) to fish for or possess CMP species in or from the Gulf. As of December 4, 2018, there were 1,286 valid (non-expired) or renewable Gulf CMP for-hire permits and 32 valid or renewable Gulf CMP historical captain for-hire permits. Although the for-hire permit application collects information on the primary method of operation, the permit itself does not identify the permitted vessel as either a headboat or a charter vessel and vessels may operate in both capacities. However, only federally permitted headboats are currently required to submit harvest and effort information to the NMFS Southeast Region Headboat Survey (SRHS). Participation in the SRHS is based on determination by the Southeast Fisheries Science Center that the vessel primarily operates as a headboat. As of June 11, 2018, 70 Gulf headboats were registered in the SRHS. As a result, of the 1,318 vessels with Gulf CMP for-hire permits (including historical captain permits), up to 70 may primarily operate as headboats and the remainder as charter vessels. The average charter vessel is estimated to receive approximately $86,000 (2017 dollars) in annual revenue. The average headboat is estimated to receive approximately $261,000 (2017 dollars) in annual revenue.
        For RFA purposes only, NMFS has established a small business size standard for businesses, including their affiliates, whose primary industry is commercial fishing (see 50 CFR 200.2). A business primarily engaged in commercial fishing (NAICS code 11411) is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including its affiliates), and has combined annual receipts not in excess of $11 million for all its affiliated operations worldwide. All of the commercial fishing businesses that would be directly regulated by this proposed rule are believed to be small entities based on the NMFS size standard.
        The Small Business Administration (SBA) has established size standards for all major industry sectors in the U.S. including for-hire businesses (NAICS code 487210). A business primarily involved in the for-hire fishing industry is classified as a small business if it is independently owned and operated, is not dominant in its field of operation (including its affiliates), and has combined annual receipts not in excess of $7.5 million for all its affiliated operations worldwide. All of the for-hire businesses that would be directly regulated by this proposed rule are believed to be small entities based on the SBA size criteria. NMFS has not identified any other small entities that would be directly affected by this proposed rule.
        This proposed rule would increase the commercial and recreational minimum size limit for cobia in the Gulf zone from 33 inches (83.8 cm), fork length, to 36 inches (91.4 cm), fork length. This proposed increase in the minimum size limit would be expected to reduce aggregate annual cobia landings by 10.3 percent or 7,319 lb (3,320 kg) and decrease aggregate annual ex-vessel revenue by approximately $25,000 (2017 dollars). If this $25,000 decrease in ex-vessel revenue is divided by the average number of federally permitted commercial vessels that harvested and sold cobia from 2013 through 2017, it results in an average loss of $90 per vessel per year. If it is divided by the average number of federally permitted commercial vessels that harvested and sold cobia from 2013 through 2017, plus the number of vessels with a Federal CMP for-hire permit, it results in an average loss of $16 per vessel per year. The economic costs to each vessel would be expected to vary based on individual fishing practices and location; however, such distributional effects cannot be quantified with available data.
        Framework Amendment 7 also contains an action to consider modification of the possession limit for cobia in the Gulf zone; however, the Council decided to retain the current possession limit. Because this proposed rule would not make any changes to the current possession limit, no additional direct economic effects would be expected.
        The following discussion describes the alternatives that were not selected as preferred by the Gulf Council.
        Four alternatives were considered for the action to increase the commercial and recreational minimum size limit for cobia in the Gulf zone. The first alternative, the no action alternative, would retain the current minimum size limit of 33 inches (83.8 cm), fork length, for both sectors. This would not be expected to alter commercial harvest rates relative to the status quo, so no direct economic effects to small entities would be expected to occur. This alternative was not selected by the Council because it would fail to address concerns about the status of the Gulf cobia in the Gulf zone.
        The second alternative, which was selected as preferred, would increase the commercial and recreational minimum size limit for cobia to 36 inches (91.4 cm), fork length, in the Gulf zone.
        The third alternative would increase the recreational and commercial minimum size limit for cobia to 39 inches (99.1 cm), fork length, in the Gulf zone. This alternative would be expected to reduce aggregate annual ex-vessel revenue by approximately $70,000 (2017 dollars). This alternative was not selected by the Gulf Council because they decided a smaller increase in the minimum size limit was appropriate given the uncertainty surrounding potential overfishing and the potential for negative economic effects.
        The fourth alternative would increase the recreational and commercial minimum size limit for cobia to 42 inches (106.7 cm), fork length, in the Gulf zone. This alternative would be expected to reduce aggregate annual ex-vessel revenue by approximately $135,000 (2017 dollars). This alternative was not selected by the Gulf Council because they decided a smaller increase in the minimum size limit was appropriate given the uncertainty surrounding potential overfishing and the potential for negative economic effects.
        Three alternatives were considered for the action to modify the possession limit for cobia in the Gulf zone. The first alternative, the no action alternative, was selected as preferred and would maintain the current possession limit.
        The second alternative would decrease the per person recreational and commercial possession limit for cobia in the Gulf zone to one fish per day. This alternative would be expected to result in an estimated 6 percent reduction in Gulf cobia commercial landings and an estimated loss in annual ex-vessel revenue of $14,495 (2017 dollars). This alternative was not selected by the Council, because they determined that the proposed increase in the minimum size limit would be sufficient to address the concerns of potential overfishing of Gulf cobia prior to the next planned stock assessment. In accordance with that determination, and in consideration of potential negative economic effects, the Council decided to maintain the current possession limit for cobia in the Gulf zone.

        The third alternative would create a recreational and commercial vessel trip limit for cobia in the Gulf zone. Under this vessel limit, anglers would not be permitted to exceed the per person possession limit. The third alternative contained three options. The first option would set the recreational and commercial vessel trip limit for cobia in the Gulf zone at two fish, which would be expected to result in an estimated 5 percent reduction in commercial landings and an estimated loss in annual ex-vessel revenue of $12,080 (2017 dollars). The second option would set the recreational and commercial vessel trip limit for cobia in the Gulf zone at four fish, which would be expected to result in an estimated 1.6 percent reduction in commercial landings and an estimated loss in annual ex-vessel revenue of $3,865 (2017 dollars). The third option would set the recreational and commercial vessel trip limit for cobia in the Gulf zone at six fish, which would be expected to result in an estimated 0.7 percent reduction in commercial landings and an estimated loss in annual ex-vessel revenue of $1,691 (2017 dollars). This alternative was not selected by the Council, because they determined that the proposed increase in the minimum size limit would be sufficient to address the concerns of potential overfishing of Gulf cobia prior to the next planned stock assessment. In accordance with that determination, and in consideration of potential negative economic effects, the Council decided not to implement a vessel trip limit.
        No duplicative, overlapping, or conflicting Federal rules have been identified. In addition, no new reporting, record-keeping, or other compliance requirements are introduced by this proposed rule. Accordingly, the Paperwork Reduction Act does not apply to this proposed rule.

          List of Subjects in 50 CFR Part 622
          Cobia, Fisheries, Fishing, Gulf of Mexico, Size limits.

          Dated: September 27, 2019.
          Samuel D. Rauch III,
          Deputy Assistant Administrator for Regulatory Programs, National Marine Fisheries Service.

        For the reasons set out in the preamble, 50 CFR part 622 is proposed to be amended as follows:

          PART 622—FISHERIES OF THE CARIBBEAN, GULF OF MEXICO, AND SOUTH ATLANTIC

        1. The authority citation for part 622 continues to read as follows:

          Authority:
           16 U.S.C. 1801 et seq.

        2. In § 622.380, revise paragraph (a)(1) to read as follows:

          § 622.380
          Size limits.

          (a) * * *
          (1) Gulf migratory group (i) Gulf zone—36 inches (91.4 cm), fork length.
          (ii) Florida east coast zone—33 inches (83.8 cm), fork length.

      [FR Doc. 2019-21482 Filed 10-2-19; 8:45 am]
       BILLING CODE 3510-22-P