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HCFA Final Rule-Poverty Level Pregnant Women Eligible for Medicaid

DCL-93-12

Published: February 23, 1993
Information About:
State/Local Child Support Agencies
Topics:
Case Management, Medical Support, Family Services & Referrals, Health Care Coverage

TO ALL STATE IV-D DIRECTORS

Dear Colleague:

This to inform you of the recent publication by the Health Care Financing Administration (HCFA) of a final rule, with comment period, regarding the cooperation requirements for women eligible for Medicaid services under section 1902(l)(1)(A) of the Social Security Act (the Act).

Enclosed is a copy of the rule published in the Federal Register on January 19, 1993 (58 FR 4904). It implements section 4606 of the Omnibus Budget Reconciliation Act of 1990, Public Law 101-508. Section 4606 provides an exemption for certain pregnant women and women in the postpartum period from the general requirement that legally able applicants and recipients of Medicaid cooperate with the State in establishing paternity and in obtaining medical support and payments. These women, termed "poverty level pregnant women" by HCFA, are eligible for Medicaid services, as a mandatory eligibility group, under section 1902(l)(1)(A) of the Act.

As specified in the preamble to the rule (58 FR at 4905):

"While poverty level pregnant women are exempt from the paternity-related cooperation requirements, as a condition of Medicaid eligibility, they are, nevertheless, entitled to child support enforcement (CSE) services under the title IV-D program. These services include establishing paternity, locating absent parents, and obtaining child and spousal support, including medical support. The Medicaid agency should ascertain whether the poverty level pregnant woman wishes CSE services and refer those who do to the CSE agency."

We encourage State IV-D Directors to review the enclosed final rule with comment period and to consult with their State Medicaid agencies regarding appropriate referral criteria and procedures to implement these new regulations. We also encourage you to send HCFA, at the address listed in the Federal Register, any comments on the rule during the comment period, which ends March 22, 1993. We would appreciate your also sending to us a copy of any comments you submit to HCFA.

Please send our copy to:

OCSE, Policy and Planning Division, 370
L'Enfant Promenade, S.W., Washington, DC 20447

If you have any questions, or need additional information, please contact Andrew J. Hagan, OCSE Policy and Planning Division (202) 401-5375.

Sincerely,

Robert C. Harris

Acting Deputy Director

Office of Child Support Enforcement

Enclosure

cc: ACF Regional Administrators

Child Support Program Managers, Regions I - X

DEPARTMENT OF HEALTH AND HUMAN SERVICES

Health Care Financing Administration

42 CFR Parts 433, 435, and 436

(MB-48-FC)

RIN 0938-AF65

Medicaid Program; Exemption of Poverty Level Pregnant Women from the Cooperation Requirements of Establishing Paternity and Obtaining Medical Support and Payments as a Condition of Eligibility; Technical Correction

Agency: Health Care Financing Administration (HCFA), HHS,

Action: Final rule with comment period.

Summary: In general, as a condition of eligibility for Medicaid coverage, each legally able applicant and recipient is required by section 1912(a) of the Social Security Act (the Act) to cooperate with the State in establishing the paternity of any eligible child born out of wedlock and in obtaining medical support and payment. The condition is required to be met unless the individual establishes good cause of not cooperating. Section 4606 of the Omnibus Budget Reconciliation Act of 1990, (OBRA '90), Public law 101-508, provides an exemption to this requirement for certain pregnant women and women in the postpartum period, as described in section 1902(l)(1)(A) of the Act. We have identified this group as "poverty level pregnant women". This final rule with comment period modifies our regulations to interpret and incorporate this exemption.

Date: Effective Date: The provisions of this rule are effective on February 18, 1993.

Comment Period: Written comments will be considered if they are mailed or delivered to the appropriate address, as provided below, and received by 5 p.m. on March 22, 1993.

ADDRESSES: Mail comments to the following address: Health Care Financing Administration, Department of Health and Human Services, Attention: MB-048-FC, P.0. Box 26676, Baltimore, MD 21207.

If you prefer, you may deliver your written comment to one of the following addresses:

Room 309-G, Hubert H. Humphrey Building, 200 Independence Avenue, S.W., Washington. D.C. 20201, or Room 132, East High Rise Building, 6325 Security Boulevard, Baltimore, Maryland 21207, or

Due to staffing and resource limitations, we cannot accept comments by facsimile (FAX) transmission. In commenting, please refer to file code MB-048-FC. Comments received timely will be available for public inspection as they are received, generally beginning approximately 3 weeks after publication of a document,in Room 3O9-G of the Department's offices at 200 Independence, Avenue, S.W., Washington, D.C. on Monday through Friday of each week from 8:30 a.m. to 5 p.m. (phone: (202) 690-7890).

FOR FURTHER INFORMATION CONTACT: Robert Nakielny, (410) 966-4468.

SUPPLEMENTARY INFORMATION:

I. Background.

Medicaid is a cooperative Federal-State program authorized under Title XIX of the Social Security Act (the Act) to provide medical care to persons of limited means. Eligible individuals generally include those individuals who receive financial assistance under title IV-A (Aid to Families with Dependent children (AFDC) and title XVI (Supplemental Security Income (SSI), as well as certain other specified groups of individuals identified in section 1902(a)(10) of the Act. Each State determines the scope of its program within limitations and guidelines established by statute in section 1902(a)(10) and the Secretary's implementing regulations at 42 CFR chapter IV, subchapter C, part 435 and part 436.

One mandatory eligibility group is identified in section l9O2(a)(lO)(A)(i)(IV) as certain women described in section 1902(l)(1)(A) of the Act, and an optional eligibility group of poverty level pregnant women is identified in section 19O2(a)(lO)(A)(ii)(IX).

Section 1902(l)(1)(A) describes women during pregnancy (and during the 60-day period beginning on the last day of pregnancy) who are not members of any other Medicaid eligibility group and whose family income does not exceed the income level established by the State. The income level is expressed in terms of a percentage of the Federal poverty line, and, therefore, we will identify the section 1902(l)(1)(A) group as "poverty level pregnant women". This reference includes the coverage of these women until the last day of the month in which the 60-day postpartum period ends. Individuals in this group are eligible only to receive medical assistance for services related to

pregnancy (including prenatal, delivery, postpartum, and family planning services) and to other conditions which may complicate pregnancy.

As provided for in section 1902 of the Act, each State submits a State plan that, when approved by HCFA, provides the basis for granting Federal funds (Federal financial participation (FFP) to cover part of the expenditures incurred by the State for medical assistance and the administration of the program. Conditions for payment of FFP are primarily derived from section 1903 of the Act, and are implemented in our regulation at 42 CFR part 433.

Section 1912(a)(1) of the Act requires, as a condition of eligibility for medical assistance, that each legally able applicant and recipient must:

149 Assign to the State his or her rights, or the rights of any other individual eligible under the plan for whom he orshe can legally make an assignment, to medical support and to payment for medical care from any third party;

149 Unless the individual establishes good cause for not cooperating, cooperate with the State in establishing the paternity of a child born out of wedlock and in obtaining medical support and payments; and

149 Unless the individual establishes good cause for not cooperating, cooperate in identifying and providing information to assist the State in pursuing third parties who may be liable to pay for care and services under the plan.

Section 4606 of the Omnibus Budget Reconciliation Act of 1990 (OBRA '90), Public Law 101-508, enacted on November 5, 1990, amended one provision of section 1912(a)(1) of the Act to provide an exemption from the requirement of cooperating in establishing paternity and obtaining medical support and payments for poverty level pregnant women described in section 1902(l)(1)(A) of the Act. While poverty level pregnant women are exempt from the cooperation requirements in section 1912(a)(1)(B), these individuals are required to comply with similar provisions in sections 1912(a)(1) (A) and (C). In order to reconcile this apparent inconsistency, we have interpreted the exemption in section 1912(a)(1)(B) as applying only to the father of a child born out of wedlock and entities whose liability derives from the father, e.g., the father's insurer. Therefore, the poverty level pregnant woman may not be required as a condition of eligibility to cooperate with the State in establishing paternity or in obtaining support and payments for medical care from, or derived from, the father of the child born out of wedlock. The poverty level pregnant woman is still required to assign her rights, and the rights of any other person eligible for Medicaid for whom she can legally make an assignment, to the State for support and payment of medical care from any third party, and to cooperate with the State and provide information to be used in pursuing any other third party who may be liable to pay for care and services under the plan.

While poverty level pregnant women are exempt from the paternity-related cooperation requirements, as a condition of Medicaid eligibility, they are, nevertheless, entitled to child support enforcement (CSE) services under the title IV-D program. These services include establishing paternity, locating absent parents, and obtaining child and spousal support, including medical support. The Medicaid agency should ascertain whether the poverty level pregnant woman wishes CSE services and refer those who do to the CSE agency.

II. Regulation Provisions

The assignment of rights requirements relating to cooperation in establishing paternity and in obtaining medical support and payments as a condition of eligibility for Medicaid are included in existing regulations at õõ 433.145, 433.147, 435.604, and 436.604. We are amending these sections to reflect the changes made by section 4606 of Public Law 101-508 which amended section 1912(a)(1)(B) of the Act, and to make minoreditorial or conforming changes.

The OBRA '90 amendment provides that individuals described in section 1902(l)(1)(A) of the Act (poverty level pregnant women) are not required, as a condition of eligibility, to cooperate with the State in establishing paternity and in obtaining medical support and payments, that is ordinarily required by section 1912(a)(1)(B) of the Act.

Section 1912(a)(1)(B) of the Act expressly exempts the poverty level pregnant woman from having to cooperate in establishing an eligible child's paternity and in obtaining the support and payments described in section 1912(a)(l)(A) for herself or her child. The support and payments, in section 1912(a)(1)(A) are both medical support and payments for medical care from any third party. Therefore, section 1912(a)(1)(B) appears to exempt pregnant women from helping to obtain payments from any liable third party. Section 1912(a)(1)(C), however, separately requires that an applicant or recipient cooperate with the State in identifying and providing information to assist the State in pursuing any third party who may be liable to pay for care and services. The poverty level pregnant women in section 1902(l)(1)(A) are not exempt from the section 1912(a)(1)(A) assignment requirements and the section 1912(a)(1)(C) cooperation

requirements.

The Secretary's interpretation of the statute is consistent with the legislative history. The report of the House Committee on the Budget states that the committee bill was designed to exempt pregnant women from the cooperation requirements with respect to establishing paternity and obtaining child support (H. Rept. No. 881, 101st Cong., 2d Sess., 106-107, reprinted in 1990 U.S. Code Cong. & Admin. News 2017, 2119). The Conference Report to accompany H.R. 5835 reiterates this purpose and notes that the conference agreement adopted the House bill (H.R. Conf. Rept No. 964, 101st Cong., 2d Sess. 839-840, reprinted in 1990 U.S. Code Cong. & Admin. News 2374, 2544-2545). The legislative history does not suggest that Congress intended to relieve poverty level pregnant women from the requirement of cooperating with the State in pursuing a responsible third party who may be liable to pay for medical care available under the plan. Therefore, we believe that the amendment by Public Law 101-508 to section 19l2 of the Act exempts poverty level pregnant women from helping States to obtain support and payments for medical care from, or derived from the father of the child born out of wedlock. These women must still assign their rights to the State in accordance with section 1912(a)(1)(A) and otherwise cooperate in obtaining other forms of third party payments such as, for example, payments from private insurance or tort settlements.

The Secretary's interpretation of the statutory requirements is clearly stated in this final rule. The general rule is this: An applicant or recipient must cooperate in establishing the paternity of any eligible child and in obtaining medical support and payment for himself or herself and any eligible child. Individuals described in section 1902(l)(1)(A) of the Act, poverty level pregnant women are exempt from the section 1912(a)(1)(B) requirements involving cooperation in establishingpaternity and obtaining medical support and payments from, or derived from, the father of the child born out of wedlock. Poverty level pregnant women must, however, cooperate in identifying and providing information to the Medicaid agency in pursuing other third parties who may be liable to pay for care and services under the plan. This revision does not alter the existing provisions that any individual may be exempt from the cooperation requirements by demonstrating good cause for refusing to cooperate.

To reflect the above described provisions, we are revising paragraph (a) of õ 433.145, to clarify that an applicant or recipient is required to:

149 Assign rights to medical support and to payment for medical care from any third party;

149 Except for individuals described in section 1902(a)(1)(A) of Act (poverty level pregnant women), cooperate with the agency in establishing paternity and in obtaining medical support and payments; and

149 Cooperate in identifying and providing information to assist the agency in pursuing third parties who may be liable to pay for care and services under the plan.

We also clarify that unless the individual demonstrates good cause for not cooperating, cooperation is required.

In õ 433.147, we clarify the section title by revising it to read, cooperation in establishing paternity, and in obtaining medical support and payments and in identifying and providing information to assist in pursuing third parties who may be liable to pay. In paragraph (a) we clarify that an individual who assigns his or her rights must cooperate in establishing paternity of a child born out of wedlock and in obtaining medical support and payments for himself or herself and any other person for whom the individual can legally assign rights except that individuals described in section 1902(l)(1)(A) of the Act (poverty level pregnant women) are exempt from these requirements involving paternity and obtaining medical support, and payments from, or derived from, the father of the child born out of wedlock. We also make several editorial changes to improve readability of the section.

In õõ 435.604, and 436.604, we clarify that an applicant or recipient is required to:

149 Assign rights to medical support and to payment for medical care from any third party;

149 Except for individuals described in section l9O2(l)(1)(A) of the Act (poverty level pregnant women), cooperate with the agency in establishing paternity and in obtaining medical support and payments; and

149 Cooperate in identifying and providing information to assist the agency in pursuing third parties who may be liable to pay for care and services under the plan.

We also clarify that unless the individual establishes good cause for not cooperating, cooperation is required.

III. Waiver of Notice of Proposed Rulemaking

Section 4207(j) of Public Law 101-508 gives the Secretary authority to issue regulations on an interim or other basis as may be necessary to implement the amendments made by the provision of Public Law 101-508.

This regulation updates our rule to properly reflect statutory provisions of section 4606 of Public Law 101-508. These statutory provisions are effective on November 5, 1990. Without these changes, our regulations conflict with statutory provisions. While we have determined that prompt publication of these regulations best serves those agencies and individuals governed by the regulations, we are providing a 60-day comment period for public comments on the rule.

IV. Response to Comments

Because of the large number of items of correspondence we normally receive on rules, we are not able to acknowledge or respond to them individually. However, we will consider all comments that we receive by the date and time specified in the "Dates" section of this preamble, and will respond to the comments in the preamble in any subsequent rule that we issue.

V. Technical Correction

We are making a technical correction to õ 435.408 and õ 436.408 to correct a paragraph reference in regulations originally published on September 7, 1990, at 55 FR 36813 and subsequently republished as a technical correction on March 14, 1991, at 56 FR 10807. References to revised õ 435.408(a)(13) and õ 436.408(a)(13) are incorrect. The correct references are õ 435.408(b)(13) and õ 436.408(b)(13), respectively. These sections set forth the standards for documentation that a State agency may accept and must review to establish that the Immigration and Naturalization Service has placed the alien in a category that qualifies the individual for Medicaid consideration. These changes are effective October 9, 1990, the effective date of the original publication of the regulations in the Federal Register.

VI. Paperwork Reduction Act of 1980

This final Rule with comment period contains no information collection or recordkeeping requirements subject to the Paperwork Reduction Act of 1980 (44 U.S.C. 3801 et seq.).

VII. Regulatory Impact Statement

Executive Order 12291 (E.O. 12291) requires us to prepare and publish a final regulatory impact analysis for any final regulation that meet one of the E.O. 12291 criteria for a "major rule"; that is that would be likely to result in--

149 An annual effect on the economy of $100 million or more;

149 A major increase in costs or prices for consumers, individual industries, Federal, State, or local governmentagencies, or geographic regions, or

149 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 or export markets.

In addition, we generally prepare a final regulatory flexibility analysis that is consistent with the Regulatory Flexibility Act (RFA) (5 U.S.C. 601 through 612), unless the Secretary certifies that a final regulation would not have a significant economic impact on a substantial number of small entities. For purposes of the RFA, individuals and States are not considered small entities.

Also section 1102(b) of the Act requires the Secretary to prepare a regulatory impact analysis for any final regulation that may have a significant impact on the operations of a substantial number of small rural hospitals. Such an analysis must conform to the provisions of section 603 of the RFA. For purposes of section 1102(b) of the Act, we consider a small rural hospital as a hospital which is located outside a Metropolitan Statistical Area and has fewer than 50 beds.

Although we are unable to estimate actual costs or savings, the provisions contained in this rule are not expected

to result in an annual economic impact of $100 million or more. States may incur some increased costs as a result of individuals being exempt from cooperating in establishing paternity and in obtaining medical support and payments from, or derived from, the father. However, since those individuals are not precluded from cooperating and may, in fact, voluntarily cooperate in establishing paternity, we believe the impact is minimal. In addition, by removing impediments to prenatal and postpartum care, the provisions implemented by this rule are expected to reduce infant mortality and save money which would otherwise be spent on costly services such as neonatal intensive care.

Therefore, we have determined, and the Secretary certifies, that this final rule is not a major rule and would not have a significant economic impact on a substantial number of small entities. Also, this rule would not have a significant impact on the operations of a substantial number of small rural hospitals. We have not prepared a regulatory impact analysis, a small rural hospital analysis, or an initial regulatory flexibility analysis.

List of subjects

42 CFR Part 433

Administrative practice and procedure, Child Support, Claims, Grant programs-health, Medicaid, Reporting and recordkeeping requirements.

42 CFR Part 435

Aid to Families with Dependent Children, Grant programs-health, Medicaid, Reporting and recordkeeping requirements, SupplementalSecurity Income (SSI), Wages.

42 CFR Part 436

Aid to Families with Dependent Children, Grant programs-health, Guam, Medicaid, Puerto Rico, Supplemental Security Income (SSI), Virgin Islands.

42 CFR chapter IV, subchapter C, is amended as set forth below:

PART 433 -- STATE FISCAL ADMINISTRATION

A. Part 433, subpart D is amended as follows:

l. The authority citation for part 433 continues to read as follows:

Authority: Secs. 1102, 1902(a)(4), l9O2(a)(18), 1902(a)(25), 1902(a)(45), 1903(a)(3), 1903(d)(2), 1903(d)(5), 1903(o), 1903(p), 1903(r), 1912, and 1917 of the Social Security Act (42 U.S.C. 1302, 1396(a)(4), 1396a(a)(18), 1396a(a)(26), 1396a(a)(45), 1396b(a)(3), 1396b(d)(2), 1996b(d)(5), 1396b(o), 1396b(p), 1396b(r), 1396k, and 1396p.

2. In õ 433.145, paragraph (a) is revised to read as follows:

õ 433.145 Assignment of rights to benefits--State plan requirements

(a) A State plan must provide that, as a condition of eligibility, each legally able applicant or recipient is required to:

(1) Assign to the Medicaid agency his or her rights, or the rights of any other individual eligible under the plan for whom he or she can legally make an assignment, to medically support and to payment for medical care from any third party;

(2) Cooperate with the agency in establishing paternity and in obtaining medical support and payments, unless the individual establishes good cause for not cooperating, and except for individuals described in section l9O2(l)(1)(A) of the Act (poverty level pregnant woman), who are exempt from cooperating in establishing paternity and obtaining medical support and payments from, or derived from, the father of the child born out of wedlock; and

(3) Cooperate in identifying and providing information to assist the Medicaid agency in pursuing third parties who may be liable to pay for care and services under the plan, unless the individual establishes good cause for not cooperating.

* * * * *

3. In õ 433.147, the section title and paragraph (a) are revised to read as follows:

õ 433.147 Cooperation in establishing paternity and in obtaining medical support and payments and in identifying and providing information to assist in pursuing third parties who may be liable to pay.

(a) Scope of requirement. The agency must require the individual who assigns his or her rights to cooperate in--

(1) Establishing paternity of a child born out of wedlock and obtaining medical support and payments for himself or herself and any other person for whom the individual can legally assign rights, except that individuals described in section 1902(l)(1)(A) of the Act (poverty level pregnant women) are exempt from these requirements involving paternity and obtaining medical support and payments from, or derived from, the father of the child born out of wedlock; and

(2) Identifying and providing information to assist the Medicaid agency in pursuing third parties who may be liable to pay for care and services under the plan.

* * * * * *

PART 435--ELIGIBILITY IN THE STATES, DISTRICT OF COLUMBIA, THE NORTHERN MARIANA ISLANDS, AND AMERICAN SAMOA

* * * * * *

B. Part 435 is amended as follows:

1. The authority citation for part 435 continues to read as follows:

Authority: Sec. 1102 of the Social Security Act (42 U.S.C. 1302).

2. Technical Correction

õ 435.408 (Amended)

On page 10807, column 1, in FR document 91-5922, published on March 14, 1991, the amendatory language "5. In õ 435.408, paragraph (a)(13) is revised to read as follows: is corrected to read "5. In õ 435.408 paragraph (b)(l3) is revised to read as follows:" and the citation to paragraph "(a)" under the text of õ 435.408 is corrected to read "(b)".

3. In õ 435.604, paragraph (a) is revised to read as follows:

õ 435.604 Assignment of rights to benefits.

(a) As a condition of eligibility, the agency must require legally able applicants and recipients to:

(1) Assign rights to the Medicaid agency to medical support and to payment for medical care from any third party;

(2) Cooperate with the agency in establishing paternity and in obtaining medical support and payments, unless the individual establishes good cause for not cooperating and except for individuals described in section 1902 (l)(1)(A) of the Act (poverty level pregnant women), who are exempt from cooperating in establishing paternity and obtaining medical support and payments from, or derived from, the father of the child born out of wedlock; and

(3) Cooperate in identifying and providing information to assist the Medicaid agency in pursuing third parties who may be liable to pay for care and services under the plan, unless the individual establishes good cause for not cooperating.

* * * * *

PART 436--ELIGIBILITY IN GUAM, PUERTO RICO, AND THE VIRGIN ISLANDS

C. Part 436 is amended as follows:

1. The authority citation for part 436 continues to read as follows:

Authority: Sec. 1102 of the Social Security Act (42 U.S.C. 1302).

2. Technical Correction

õ 436.408 (Amended)

On page 10807, column 2 in FR document 91-5922 published on March 14, 1991, the amendatory language "5. In õ 436.408, paragraph (a)(13) is revised to read as follows:" is corrected to read "5. In õ 436.408 paragraph (b)(l3) is revised to read as follows:" and the citation to paragraph "(a)" under the text of õ 436.408 is corrected to read "(b)".

3. In õ 436.604, paragraph (a) is revised to read as follows:

õ 436.604 Assignment of rights to benefits.

(a) As a condition of eligibility, the agency must require legally able applicants and recipients to:

(1) Assign rights to the Medicaid agency to medical support and to payment for medical care from any third party;

(2) Cooperate with the agency in establishing paternity and in obtaining medical support and payments, unless the individual establishes good cause for not cooperating, and except for individuals described in section 1902(l)(1)(A) of the Act (poverty level pregnant women), who are exempt from cooperating in establishing paternity and obtaining medical support and payment from, or derived from, the father of the child born out of wedlock: and

(3) Cooperate in identifying and providing information to assist the Medicaid agency in pursuing third parties who may be liable to pay for care and services under the plan, unless the individual establishes good cause for not cooperating.

* * * * *

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

Dated: June 16, 1992

William Toby, Jr.

Acting Administrator, Health Care Financing Administration

Approved: August 21, 1992

Louis W. Sullivan

Secretary

(FR Doc. 93-972 Filed 1-15-93;8:45 am)