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Notice of Hearing: Reconsideration of Disapproval of Iowa State Plan Amendment (SPA) 01-013

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AGENCY:

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

ACTION:

Notice of hearing.

SUMMARY:

This notice announces an administrative hearing on November 14, 2001, 10 a.m., Room 281, Richard Bolling Federal Building, 601 E. Twelfth Street, Kansas City, Missouri 64106.

CLOSING DATE:

Requests to participate in the hearing as a party must be received by the presiding officer by October 24, 2001.

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FOR FURTHER INFORMATION CONTACT:

Kathleen Scully-Hayes, Presiding Officer, CMS, C1-09-13, 7500 Security Boulevard, Baltimore, Maryland 21244, Telephone: (410) 786-2055.

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SUPPLEMENTARY INFORMATION:

This notice announces an administrative hearing to reconsider our decision to disapprove Iowa State Plan Amendment (SPA) 01-013. Iowa submitted Iowa SPA 01-013 on March 28, 2001. The issue is whether Iowa can limit Medicaid eligibility to members of the Balanced Budget Act of 1997 (BBA) buy-in group for the working disabled who have not attained age 65.

This amendment seeks to limit Medicaid eligibility under the optional categorically needy group at section 1902(a)(10)(A)(ii)(XIII) of the Social Security Act (the Act), to individuals under age 65. This group is more commonly known as the BBA buy-in group for the working disabled. Coverage of the group itself was approved via Iowa SPA 00-04. The SPA 01-013 seeks to add a limitation on the age of eligible individuals that was not included in SPA 00-04. For reasons explained below, the Centers for Medicare & Medicaid Services (CMS), formerly the Health Care Financing Administration, disapproved SPA 01-013.

Iowa requested approval of an age limit under the BBA group because State legislation authorizing coverage of the group limits eligibility to those under the age of 65. However, the Federal statute at section 1902(a)(10)(A)(ii)(XIII) of the Act does not provide for a limit on the age of individuals who can be eligible under this group, nor does that section include any authority for states to establish such a limit. Iowa argued that, while not stated explicitly, the intent of Congress in enacting the BBA group was that eligibility under the group be limited to individuals under age 65. The State bases its argument on a reference in subsection (XIII) to section 1905(q)(2)(B) of the Act as the authority for establishing the income limit for eligibility under the BBA group. Since eligibility in general under the group established at section 1905(q) of the Act (qualified severely impaired individuals) is limited to individuals under age 65, the State believes that age limit, through the subsection (XIII) reference to section 1905(q)(2)(B), also applies to the BBA group.

However, section 1902(a)(10)(A)(ii)(XIII) does not reference section 1905(q) in its entirety, but only subsection (2)(B), and then only in the specific context of the income limit set forth in that subsection. Accepting the argument that Congress intended, in referring to subsection (2)(B), that the age limit which applies to section 1905(q) in general should apply to the BBA group, logically leads to the conclusion that all of the other requirements of section 1905(q) would apply to the BBA group as well. However, CMS believes that this is clearly not the case because Congress established separate requirements for eligibility under the BBA group, adopting section 1905(q)(2)(B) only for purposes of establishing an income limit for that group.

The CMS believes its position to be supported by Congress' action to establish two additional groups under the Ticket to Work and Work Incentives Improvement Act of 1999 through which states can elect to cover working disabled individuals under Medicaid. The statutory provisions for both groups (sections 1902(a)(10)(A)(ii)(XV) and (XVI)) specifically limit eligibility to individuals who are at least 16 but not more than 64 years of age. Had Congress intended to limit eligibility under the BBA group to individuals under age 65, it could have amended section 1902(a)(10)(A)(ii)(XV) and (XVI) specifically limiting eligibility to individuals who are at least 16 but not more than 64 years of age. Had Congress intended to limit eligibility under the BBA group to individuals under age 65, CMS believes it could have amended section 1902(a)(10)(A)(ii)(XIII) to provide such a limit.

Therefore, after consulting with the Secretary as required by 42 CFR 430.15(c), CMS informed Iowa of its decision to disapprove this amendment. The notice to Iowa announcing an administrative hearing to reconsider the disapproval of its SPA reads as follows:

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Ms. Jessie K. Rasmussen,

Director, Iowa Department of Human Services, Hoover State Office Building, Des Moines, IA 50319-0114.

Dear Ms. Rasmussen: I am responding to your request for reconsideration of the decision to disapprove Iowa State Plan Amendment (SPA) 01-013. Iowa submitted Iowa SPA 01-013 on March 28, 2001. The issue is whether Iowa can limit Medicaid eligibility to members of the Balanced Budget Act of 1997 (BBA) buy-in group for the working disabled who have not attained age 65. This amendment seeks to limit Medicaid eligibility under the optional categorically needy group at section 1902 (a)(10)(A)(ii)(XIII) of the Social Security Act (the Act) to individuals under age 65. This group is more commonly known as the BBA buy-in group for the working disabled. Coverage of the group itself was approved via Iowa SPA 00-04. The SPA 01-013 seeks to add a limitation on the age of eligible individuals that was not included in SPA 00-04. For reasons explained below, the Centers for Medicare & Medicaid Services (CMS), formerly the Health Care Financing Administration, disapproved SPA 01-013.

Iowa requested approval of an age limit under the BBA group because State legislation authorizing coverage of the group limits eligibility to those under the age of 65. However, the Federal statute at section 1902(a)(10)(A)(ii)(XIII) of the Act does not provide for a limit on the age of individuals who can be eligible under this group, nor does that section include any authority for states to establish such a limit. Iowa argued that, while not stated explicitly, the intent of Congress in enacting the BBA group was that eligibility under the group be limited to individuals under age 65. The State bases its argument on a reference in subsection (XIII) to section 1905(q)(2)(B) of the Act as the authority for establishing the income limit for eligibility under the BBA group. Since eligibility in general under the group established at section 1905(q) of the Act (qualified severely impaired individuals) is limited to individuals under age 65, the State believes that age limit, through the subsection (XIII) reference to section 1905(q)(2)(B), also applies to the BBA group.

However, section 1902(a)(10)(A)(ii)(XIII) does not reference section 1905(q) in its entirety, but only subsection (2)(B), and then only in the specific context of the income limit set forth in that subsection. Accepting the argument that Congress intended, in referring to subsection (2)(B), that the age limit which applies to section 1905(q) in general should apply to the BBA group, logically leads to the conclusion that all of the other requirements of section 1905(q) would apply to the BBA group as well. However, this is clearly not the case because Congress established separate requirements for eligibility under the BBA group, adopting section 1905(q)(2)(B) only for purposes of establishing an income limit for that group.

The CMS believes its position to be supported by Congress' action to establish two additional groups under the Ticket to Work and Work Incentives Improvement Act of 1999 through which states can elect to cover working disabled individuals under Medicaid. The statutory provisions for both groups (sections 1902(a)(10)(A)(ii)(XV) and (XVI)) specifically limit eligibility to individuals who are at least 16 but not more than 64 years of age. Had Congress intended to limit eligibility under the BBA group to individuals under age 65, it could have amended section 1902(a)(10)(A)(ii)(XV) and (XVI) specifically limiting eligibility to individuals who are at least 16 but not more than 64 years of age. Had Congress intended to limit eligibility under the BBA group to individuals under age 65, it could have amended section 1902(a)(10)(A)(ii)(XIII) to provide such a limit.

The CMS had offered Iowa an alternative that would have enabled the State to avoid covering most individuals age 65 and over under the BBA group. The State could define the group as consisting only of individuals who meet the definition of disability under the Supplemental Security Income (SSI) program. By defining the group in this way, the State would not have to cover anyone age 65 or over who did not also meet the SSI definition of disability. However, Iowa was not able to take advantage of this alternative because of the specific language of the State's enabling legislation.

Therefore, after consulting with the Secretary as required by 42 CFR 430.15(c), CMS informed Iowa of its decision to disapprove this amendment.

I am scheduling a hearing on your request for reconsideration to be held on November 14, 2001, at 10:00 a.m. in Room 281, Richard Bolling Federal Building, 601 E. Twelfth Street, Kansas City, Missouri 64106. If this date is not acceptable, we would be glad to set another date that is mutually agreeable to the parties. The hearing will be governed by the procedures prescribed at 42 CFR, Part 430.

I am designating Ms. Kathleen Scully-Hayes as the presiding officer. If these arrangements present any problems, please contact the presiding officer. In order to facilitate any communication, which may be necessary between the parties to the hearing, please notify the presiding officer to indicate acceptability of the hearing date that has been scheduled and provide names of the individuals who will represent the State at the hearing. The presiding officer may be reached at (410) 786-2055.

   Sincerely,

Thomas A. Scully,

Administrator, Centers for Medicare & Medicaid Services.

Section 1116 of the Social Security Act (42 U.S.C. section 1316; 42 CFR section 430.18).

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(Catalog of Federal Domestic Assistance Program No. 13.714, Medicaid Assistance Program)

Dated: September 30, 2001.

Thomas A. Scully,

Administrator, Centers for Medicare & Medicaid Services.

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[FR Doc. 01-25227 Filed 10-3-01; 1:55 pm]

BILLING CODE 4120-03-P