April 8, 1988
SUBJECT:Extension of Child Support Enforcement Services to Medicaid-only Recipients and to Former Recipients of AFDC, as Required by the Omnibus Budget Reconciliation Act of 1987.
TO:STATE AGENCIES ADMINISTERING CHILD SUPPORT ENFORCEMENT PLANS APPROVED UNDER TITLE IV-D OF THE SOCIAL SECURITY ACT AND OTHER INTERESTED INDIVIDUALS
PURPOSE: The purpose of this action transmittal is to notify States of changes to title IV-D of the Social Security Act (the Act) due to the December 22, 1987 enactment of the Omnibus Budget Reconciliation Act of 1987 (P.L. 100-203). Two provisions of P.L. 100-203 will require revisions to the child support enforcement (CSE) regulations. A proposed regulation implementing the statutory changes is under development and will be published for comment.
CONTENTS:Statutory Provisions. Section 9141 of P.L. 100-203, effective December 22, 1987, amended section 457(c) of the Act to require State CSE agencies to provide appropriate notice and to continue to provide CSE services to persons no longer eligible for Aid to Families with Dependent Children (AFDC) under title IV-A of the Act. The CSE agency must continue to provide services and pay any amount of support collected to the family on the same basis and under the same conditions as pertain to other non-AFDC families, except that no application, other request to continue services or any application fee for services may be required.
Section 9142, effective July 1, 1988, amended section 454 of the Act to require State CSE agencies to provide CSE services to all families with an absent parent who receive Medicaid and have assigned to the State, under section 1912 of the Act, their rights to medical support, and to provide for distribution by the State of medical support collections under section 1912 of the Act.
Three other provisions of P.L. 100-203 will not require any regulatory revisions. Section 9143 repeals an unnecessary child support revolving fund, while sections 9121 and 9122 provide for demonstration programs in Washington State and New York State, respectively.
Continuation of Services to Former AFDC Recipients. When section 457(c) of the Act was amended by the Child Support Enforcement Amendments of 1984 (P.L. 98-378) to require (rather than allow) provision of CSE services to families after AFDC eligibility ends, the intent of Congress was that all CSE services continue to be provided, as in non-AFDC IV-D cases, to families whose AFDC eligibility was terminated, without payment of a fee or filing of an application for services. However, as amended by P.L. 98-378, there remained a transition period of up to five months during which cases were treated differently from non-AFDC cases. During the five-month period, States were not given the option to recover costs of providing services and distribution of amounts collected was inconsistent with distribution in other non-AFDC cases. The statute also required authorization for continuation of IV-D services after the five-month period, while prohibiting the necessity of filing an application or paying an application fee.
The enactment of section 9141 of P.L. 100-203, effective December 22, 1987, eliminates this temporary category of cases. Without an application or application fee, these cases become non-AFDC cases once AFDC eligibility ends. The IV-D agency must notify the family that the case will become a non-AFDC case and that CSE services will continue to be provided without the need for an application or payment of an application fee. In accordance with 45 CFR 302.51(e)(2), the notice must explain to the family the State's fees, cost recovery and distribution policies. The notice must inform the family that services will be continued unless the IV-D agency is notified by the family that continued services are not desired.
Because these cases become non-AFDC cases, a State may recover the costs of providing CSE services, if it does so in other non-AFDC cases. Distribution of collections for former AFDC recipients will now be consistent with each State's non-AFDC distribution policy, i.e. priority must be given to current support and the State may choose whether to reimburse itself for AFDC payments made to the family first or pay collections of past due support to the family first. In accordance with 45 CFR 302.51(f), the IV-D agency must attempt to collect any unpaid support obligation which accrued under theassignment of rights to support while the family was receiving AFDC.
Services to Medicaid recipients. Applicants and recipients of Medicaid are required under section 1912(a)(1) of the Act to assign to the State their rights to medical support and payment of medical care from any third party and to cooperate with the State in securing support. However, when assignment of rights to medical support was made a condition of eligibility for Medicaid by the Deficit Reduction Act of 1984 (section 2367 of P.L. 98-369), there was no corresponding amendment added to title IV-D of the Act requiring CSE agencies to provide services to Medicaid applicants and recipients who assigned their rights to support under section 1912 of the Act. Therefore, prior to enactment of P.L. 100-203, CSE agencies were required to provide services to Medicaid families who were referred to the CSE agency because they were AFDC applicants and recipients. CSE services were also available to Medicaid-only families (those families receiving Medicaid but not AFDC), but only by application (and payment of an application fee); in essence, there cases were treated as non-AFDC IV-D cases.
Effective July 1, 1988, section 9142 of P.L. 100-203 requires that the CSE agency provide IV-D services to families who have assigned their rights to medical support as a condition of receipt of Medicaid. CSE agencies must provide all appropriate CSE services to Medicaid applicants and recipients with an absent parent, whether or not there are also eligible for AFDC, without an application or application fee. State CSE agencies are required by 45 CFR 306.51 to petition for medical support when health insurance is available to the absent parent at a reasonable cost. The child support collected on behalf of Medicaid-only families must be paid to the family in accordance with the State's non-AFDC distribution policy. When the support order defines a specific dollar amount for medical support, cash medical support collected must be distributed to the Federal and state governments as appropriate under section 1912 of the Act.
A Notice of Proposed Rulemaking which will provide a more detailed explanation of these changes and include regulatory revisions is under development.
ATTACHMENT:Copies of sections 9141 and 9142 of the Omnibus Budget Reconciliation Act of 1987.
EFFECTIVE DATES:December 22, 1987, for the continuation of IV-D services to former AFDC recipients.
July 1, 1988, for the extension of IV-D services to families receiving Medicaid, but not AFDC.
SUPERSEDED MATERIAL:OCSE-AT-86-04, dated March 13, 1986
INQUIRIES TO:OCSE Regional Representatives.
Wayne A. Stanton
Office of Child Support Enforcement
PART 3--CHILD SUPPORT ENFORCEMENT AMENDMENTS
SEC. 9141. CONTINUATION OF CHILD SUPPORT ENFORCEMENT SERVICES TO FAMILIES NO LONGER RECEIVING AFDC.
(a) IN GENERAL.--(1) Section 457(c) of the Social Security Act is amended to read as follows:
"(c) Whenever a family with respect to which child support enforcement services have been provided pursuant to section 454(4) ceases to receive assistance under part A of this title, the State shall provide appropriate notice to the family and continue to provide such services, and pay any amount of support collected, subject to the same conditions and on the same basis as in the case of the individuals to whom services are furnished pursuant to section 454(6), except that no application or other request to continue services shall be required of a family to which this subsection applies, and the provisions of section 454(6)(B) may not be applied."
(2) Section 454(5) of such Act is amended by striking "(except as provided in section 457(c))".
(b) EFFECTIVE DATE.--The amendments made by subsection (a) shall become effective upon enactment.
SEC. 9142. CHILD SUPPORT ENFORCEMENT SERVICES REQUIRED FOR CERTAIN FAMILIES RECEIVING MEDICAID.
(a) IN GENERAL.--Section 454 of the Social Security Act is amended--
(1)(A) by striking "an assignment under section 402(a)(26) of this title" in paragraph (4)(A) and inserting "an assignment under section 402(a)(26) or section 1912"..
(B) by striking ", and" at the end of paragraph (4)(A) and inserting ", or, in the case of such a child with respect to whom an assignment under section 1912 is in effect, the State agency administering the plan approved under title XIX determines pursuant to section 1912(a)(1)(B) that it is against the best interests of the child to do so, and"; and
(C) by inserting "or medical assistance under a State plan approved under title XIX" immediately after "aid to families with dependent children" in paragraph (4)(B); and
(2)(A) by striking "provide that," and inserting "provide that (A)" in paragraph (5); and
(B) by striking the semicolon at the end of paragraph (5) and inserting "; and (B) in any case in which support payments are collected for an individual pursuant to the assignment made under section 1912, such payments shall be made to the State for distribution pursuant to section 1912, except that this clause shall not apply to such payments for any month after the month in which the individual ceases to be eligible for medical assistance;".
(b) EFFECTIVE DATE.--The amendments made by subsection (a) shall become effective on July 1, 1988.