[Federal Register: October 18, 2004 (Volume 69, Number 200)]
[Notices]
[Page 61386-61388]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr18oc04-77]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
Notice of Hearing: Reconsideration of Disapproval of California's
Medicaid State Plan Amendment 03-028B
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Notice of hearing.
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SUMMARY: This notice announces an administrative hearing on
California's Medicaid State Plan Amendment (SPA) 03-28B to be held on
December 2, 2004, 10 a.m., 75 Hawthorne Street; 4th Floor Conference
Room, San Francisco, California 94105-3901 to reconsider our decision
to disapprove SPA 03-028B.
Closing Date: Requests to participate in the hearing as a party
must be received by the presiding officer by November 2, 2004.
FOR FURTHER INFORMATION CONTACT: Kathleen Scully-Hayes, Presiding
Officer, CMS, LB-23-20, Lord Baltimore Drive, Baltimore, Maryland
21244, Telephone: (410) 786-2055.
SUPPLEMENTARY INFORMATION: This notice announces an administrative
hearing to reconsider our decision to disapprove California's Medicaid
State Plan Amendment (SPA) 03-28B.
California submitted SPA 03-28B on September 18, 2003. In this SPA,
California proposed to provide targeted case management (TCM) services
in several counties for two populations: persons on probation, and
individuals with a public guardian. By letter dated July 6, 2004, the
Centers for Medicare & Medicaid Services (CMS) disapproved the SPA.
At issue in this reconsideration is whether SPA 03-28B is
consistent with the requirements contained in sections 1902(a)(10) and
1902(a)(23), of the Social Security Act (the Act), as described in more
detail below. In general, CMS found that the SPA had three fundamental
problems: (1) The proposed TCM services duplicate services that are
integral components of the State's adult probation program and the
State's public guardian program; (2) the amendment would result in
charges to Medicaid for services available without charge to
individuals on probation; and (3) the provider qualifications limit
providers of services for these groups to the probation officers
employed by the county probation departments and to court-appointed
guardians under county public guardian agencies.
More specifically, at issue is whether the SPA complies with the
requirement in section 1902(a)(10) of the Act which authorizes State
Medicaid plans to provide for ``medical assistance.'' In the definition
of that term, at section 1905(a)(19) of the Act, case management
services are authorized ``as defined in section 1915 (g)(2).'' That
section defines case management as services that assist beneficiaries
in gaining access to needed services. The Congressional Conference
committee report accompanying Pub. L. 99-272, which added section
1915(g) to the Act, emphasized that payment for case management
services must not duplicate payments made to public agencies or private
entities under other program authorities for the same purpose. CMS uses
the term ``duplication of required coverage to refer to this situation.
In this instance, Medicaid payment for services provided by the adult
probation program and the public guardian program would duplicate
payments under other programs that are the responsibility of the State
government. Because the congressional definition of Medicaid TCM
excluded duplicate coverage, CMS determined that the proposed case
management services are not within the scope of the definition of
``medical assistance'' that is authorized to be included in a State
Medicaid plan by section 1902(a)(10).
The CMS' reading of the term ``medical assistance'' to exclude
``duplication of required coverage'' is also consistent with the
language of section 8435 of Pub. L. 100-647, which states that the
Medicaid case management benefit is not to be construed as to require
the Secretary of Health and Human Services to make payment for case
management services that are provided without charge to the users of
such services. Approval of SPA 03-028B would be contrary to this
provision, because the proposed adult population services are available
without charge.
In addition, at issue is whether the proposed SPA is consistent
with the requirements at section 1902(a)(23) of the Act that a state
plan must provide that beneficiaries may obtain services from any
qualified entity or person who undertakes to provide such services. The
proposed SPA restricts providers of
[[Page 61387]]
services to the two target groups in question, to probation officers
employed by the county probation department and to court-appointed
guardians. While states are free to set qualifications for providers,
states must comply with Medicaid laws and regulations concerning
freedom-of-choice at section 1902(a)(23) of the Act and the
implementing regulation at 42 CFR 431.51. The State did not establish
why it is consistent with those requirements to restrict providers to
probation officers or public guardians. The State did not show why
those providers are uniquely qualified to assist the target population
nor did the State explain how beneficiaries would have access to
qualified providers who do not work as a probation officer or public
guardian. As a result, CMS found that the State did not demonstrate
compliance with the requirements of section 1902(a)(23) and its
implementing regulation.
Section 1116 of the Act and 42 CFR part 430 establish Department
procedures that provide an administrative hearing for reconsideration
of a disapproval of a state plan or plan amendment. CMS is required to
publish a copy of the notice to a state Medicaid agency that informs
the agency of the time and place of the hearing and the issues to be
considered. If we subsequently notify the agency of additional issues
that will be considered at the hearing, we will also publish that
notice.
Any individual or group that wants to participate in the hearing as
a party must petition the presiding officer within 15 days after
publication of this notice, in accordance with the requirements
contained at 42 CFR 430.76(b)(2). Any interested person or organization
that wants to participate as amicus curiae must petition the presiding
officer before the hearing begins in accordance with the requirements
contained at 42 CFR 430.76(c). If the hearing is later rescheduled, the
presiding officer will notify all participants. Therefore, based on the
reasoning set forth above, and after consultation with the Secretary as
required under 42 CFR 430.15(c)(2), CMS disapproved California SPA 03-
28B.
The notice to California announcing an administrative hearing to
reconsider the disapproval of its SPA reads as follows:
Mr. Stan Rosenstein,
Deputy Director, Department of Health Services,
MS 40900, P.O. Box 942732, Sacramento, CA 94231-7320.
Dear Mr. Rosenstein:
I am responding to your request for reconsideration of the
decision to disapprove California State Plan Amendment (SPA) 03-28B,
which the State submitted on September 18, 2003. In this SPA,
California proposed to provide targeted case management (TCM)
services in several counties for two populations, persons on
probation and individuals with a public guardian. The Centers for
Medicare & Medicaid Services (CMS) reviewed this proposal, and for
the reasons set forth below, was unable to approve SPA 03-28B as
submitted.
At issue in this reconsideration is whether SPA 03-28B is
consistent with the requirements contained in sections 1902(a)(10)
and 1902(a)(23) of the Social Security Act (the Act), as described
in more detail below. In general CMS found that the SPA has three
fundamental problems: (1) The proposed TCM services duplicate
services that are integral components of the State's adult probation
program and the State's public guardian program; (2) the amendment
would result in charges to Medicaid for services available without
charge to individuals on probation; and (3) the provider
qualifications limit providers of services for these groups to the
probation officers employed by the county probation departments and
to court-appointed guardians under county public guardian agencies.
Section 1902(a)(10) of the Act authorizes state Medicaid plans
to provide for ``medical assistance.'' In the definition of that
term, at section 1905(a)(19) of the Act, case management services
are authorized ``as defined in section 1915(g)(2).'' That section
defines case management as services that assist beneficiaries in
gaining access to needed services. The Congressional Conference
committee report accompanying Pub. L. 99-272, which added section
1915(g) to the Act, emphasized that payment for case management
services must not duplicate payments made to public agencies or
private entities under other program authorities for the same
purpose.
The CMS uses the term ``duplication of required coverage'' to
refer to this situation, in order to distinguish it from
circumstances in which two payments are actually made for the same
claim. In this instance, Medicaid payment for services provided by
the adult probation program and the public guardian program would
duplicate payments under other programs that are the responsibility
of the State government. Therefore, CMS determined that Medicaid
funding is not available for case management for individuals in the
adult probation or public guardian system because claiming such
activities as Medicaid TCM would result in duplication of necessary
coverage. Because the congressional definition of Medicaid TCM
excluded duplicate coverage, CMS determined that the proposed case
management services are not within the scope of the definition of
``medical assistance'' that is authorized to be included in a state
Medicaid plan by section 1902(a)(10).
Congress further states in section 8435 of Pub. L. 100-647 that
the Medicaid case management benefit was not to be construed as to
require the Secretary of Health and Human Services to make payment
for case management services that are provided without charge to the
users of such services. Approval of SPA 03-028B would be contrary to
this provision. The activities in question are key service and/or
administrative activities of the State's adult probation program.
Thus, CMS determined that the SPA cannot be approved because the
adult population services are available without charge.
The proposed SPA restricts providers of services to the two
target groups in question, to probation officers employed by the
county probation department and to court-appointed guardians. While
states are free to set qualifications for providers, states must
comply with Medicaid laws and regulations concerning freedom-of-
choice at section 1902(a)(23) of the Act and the implementing
regulation at 42 CFR 431.51. The State did not establish why it is
consistent with those requirements to restrict providers to
probation officers or public guardians. The State did not show why
those providers are uniquely qualified to assist the target
population in gaining access to medical, educational, social, and
other services. Nor did the State explain how beneficiaries would
have access to qualified providers who do not work as a probation
officer or public guardian. As a result, the State did not
demonstrate compliance with the requirements of section 1902(a)(23)
and its implementing regulation.
Therefore, based on the reasoning set forth above, and after
consultation with the Secretary as required under 42 CFR
430.15(c)(2), CMS disapproved California SPA 03-28B. This
disapproval only applies to SPA 03-028B. The currently approved
sections of the State Plan for these target groups will remain in
effect. However, CMS would like to emphasize that providing Medicaid
TCM to individuals in the adult probation or public guardian State
systems is not consistent with CMS' interpretation of applicable
laws, as noted above. To the extent that current plan provisions do
so, CMS expects the State to revise its plan in order to come into
compliance on this issue. Moreover, CMS may review State claims to
determine if Federal Medicaid funding is appropriate when another
program or entity is liable for payment.
I am scheduling a hearing on your request for reconsideration to
be held December 2, 2004, at 10 a.m., 4th Floor Conference Room, 75
Hawthorne Street, San Francisco, California 94105-3901. 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.
[[Page 61388]]
Sincerely,
Mark B. McClellan, M.D., Ph.D.
Section 1116 of the Social Security Act (42 U.S.C. section 1316); 42
CFR Section 430.18)
(Catalog of Federal Domestic Assistance Program No. 13.714, Medicaid
Assistance Program)
Dated: October 6, 2004.
Mark B. McClellan,
Administrator, Centers for Medicare & Medicaid Services.
[FR Doc. 04-23252 Filed 10-15-04; 8:45 am]
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