[Federal Register: October 5, 2007 (Volume 72, Number 193)]
[Notices]
[Page 57037-57039]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr05oc07-53]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-8031-N]
RIN 0938-AO62
Medicare Program; Part A Premium for Calendar Year 2008 for the
Uninsured Aged and for Certain Disabled Individuals Who Have Exhausted
Other Entitlement
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Notice.
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SUMMARY: This annual notice announces Medicare's Hospital Insurance
(Part A) premium for uninsured enrollees in calendar year (CY) 2008.
This premium is to be paid by enrollees age 65 and over who are not
otherwise eligible for benefits under Medicare Part A (hereafter known
as the ``uninsured aged'') and by certain disabled individuals who have
exhausted other entitlement. The monthly Part A premium for the 12
months beginning January 1, 2008 for these individuals will be $423.
The reduced premium for
[[Page 57038]]
certain other individuals as described in this notice will be $233.
DATES: Effective Date: This notice is effective on January 1, 2008.
FOR FURTHER INFORMATION CONTACT: Clare McFarland, (410) 786-6390.
SUPPLEMENTARY INFORMATION:
I. Background
Section 1818 of the Social Security Act (the Act) provides for
voluntary enrollment in the Medicare Hospital Insurance program
(Medicare Part A), subject to payment of a monthly premium, of certain
persons aged 65 and older who are uninsured under the Old-Age,
Survivors and Disability Insurance (OASDI) program or the Railroad
Retirement Act and do not otherwise meet the requirements for
entitlement to Medicare Part A. (Persons insured under the OASDI
program or the Railroad Retirement Act and certain others do not have
to pay premiums for hospital insurance.)
Section 1818A of the Act provides for voluntary enrollment in
Medicare Part A, subject to payment of a monthly premium, of certain
disabled individuals who have exhausted other entitlement. These are
individuals who are not currently entitled to Part A coverage, but who
were entitled to coverage due to a disabling impairment under section
226(b) of the Act, and who would still be entitled to Part A coverage
if their earnings had not exceeded the statutorily defined substantial
gainful activity amount (section 223(d)(4) of the Act).
Section 1818A(d)(2) of the Act specifies that the provisions
relating to premiums under section 1818(d) through section 1818(f) of
the Act for the aged will also apply to certain disabled individuals as
described above.
Section 1818(d) of the Act requires us to estimate, on an average
per capita basis, the amount to be paid from the Federal Hospital
Insurance Trust Fund for services incurred in the following calendar
year (CY) (including the associated administrative costs) on behalf of
individuals aged 65 and over who will be entitled to benefits under
Medicare Part A. We must then determine, during September of each year,
the monthly actuarial rate for the following year (the per capita
amount estimated above divided by 12) and publish the dollar amount for
the monthly premium in the succeeding CY. If the premium is not a
multiple of $1, the premium is rounded to the nearest multiple of $1
(or, if it is a multiple of 50 cents but not of $1, it is rounded to
the next highest $1).
Section 13508 of the Omnibus Budget Reconciliation Act of 1993
(Pub. L. 103-66) amended section 1818(d) of the Act to provide for a
reduction in the premium amount for certain voluntary enrollees
(section 1818 and section 1818A). The reduction applies to an
individual who is eligible to buy into the Medicare Part A program and
who, as of the last day of the previous month--
Had at least 30 quarters of coverage under title II of the
Act;
Was married, and had been married for the previous 1-year
period, to a person who had at least 30 quarters of coverage;
Had been married to a person for at least 1 year at the
time of the person's death if, at the time of death, the person had at
least 30 quarters of coverage; or
Is divorced from a person and had been married to the
person for at least 10 years at the time of the divorce if, at the time
of the divorce, the person had at least 30 quarters of coverage.
Section 1818(d)(4)(A) of the Act specifies that the premium that
these individuals will pay for CY 2008 will be equal to the premium for
uninsured aged enrollees reduced by 45 percent.
II. Monthly Premium Amount for CY 2008
The monthly premium for the uninsured aged and certain disabled
individuals who have exhausted other entitlement for the 12 months
beginning January 1, 2008, is $423.
The monthly premium for those individuals subject to the 45 percent
reduction in the monthly premium is $233.
III. Monthly Premium Rate Calculation
As discussed in section I of this notice, the monthly Medicare Part
A premium is equal to the estimated monthly actuarial rate for CY 2008
rounded to the nearest multiple of $1 and equals one-twelfth of the
average per capita amount, which is determined by projecting the number
of Part A enrollees aged 65 years and over as well as the benefits and
administrative costs that will be incurred on their behalf.
The steps involved in projecting these future costs to the Federal
Hospital Insurance Trust Fund are:
Establishing the present cost of services furnished to
beneficiaries, by type of service, to serve as a projection base;
Projecting increases in payment amounts for each of the
service types; and
Projecting increases in administrative costs.
We base our projections for CY 2008 on: (a) Current historical
data, and (b) projection assumptions derived from current law and the
Mid-Session Review of the President's Fiscal Year 2008 Budget.
We estimate that in CY 2008, 36.777 million people aged 65 years
and over will be entitled to benefits (without premium payment) and
that they will incur $186.757 billion of benefits and related
administrative costs. Thus, the estimated monthly average per capita
amount is $423.17 and the monthly premium is $423. The full monthly
premium reduced by 45 percent is $233.
IV. Costs to Beneficiaries
The CY 2008 premium of $423 is over 3 percent higher than the CY
2007 premium of $410.
We estimate that approximately 579,000 enrollees will voluntarily
enroll in Medicare Part A by paying the full premium. We estimate an
additional 10,000 enrollees will pay the reduced premium. We estimate
that the aggregate cost to enrollees paying these premiums will be
about $91 million in CY 2008 over the amount that they paid in CY 2007.
V. Waiver of Proposed Notice and Comment Period
We are not using notice and comment rulemaking in this notification
of Part A premiums for CY 2008, as that procedure is unnecessary
because of the lack of discretion in the statutory formula that is used
to calculate the premium and the solely ministerial function that this
notice serves. The Administrative Procedure Act (APA) permits agencies
to waive notice and comment rulemaking when notice and public comment
thereon are unnecessary. On this basis, we waive publication of a
proposed notice and a solicitation of public comments.
VI. Regulatory Impact Statement
We have examined the impacts of this notice as required by
Executive Order 12866 (September 1993, Regulatory Planning and Review),
the Regulatory Flexibility Act (RFA) (September 19, 1980, Pub. L. 96-
354), section 1102(b) of the Act, the Unfunded Mandates Reform Act of
1995 (Pub. L. 104-4), and Executive Order 13132.
Executive Order 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). A regulatory impact
analysis (RIA) must be prepared for major rules with economically
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significant effects ($100 million or more in any 1 year). As stated in
section IV of this notice, we estimate that the overall effect of these
changes in the Part A premium will be a cost to voluntary enrollees
(section 1818 and section 1818A of the Act) of about $91 million.
Therefore, this notice is not a major rule as defined in Title 5,
United States Code, section 804(2) and is not an economically
significant rule under Executive Order 12866.
The RFA requires agencies to analyze options for regulatory relief
of small entities. For purposes of the RFA, small entities include
small businesses, nonprofit organizations, and government agencies.
Most hospitals and most other providers and suppliers are small
entities, either by nonprofit status or by having revenues of $6
million to $29 million in any 1 year. Individuals and States are not
included in the definition of a small entity. We have determined that
this notice will not have a significant economic impact on a
substantial number of small entities. Therefore, we are not preparing
an analysis for the RFA.
In addition, section 1102(b) of the Act requires us to prepare a
regulatory impact analysis if a rule may have a significant impact on
the operations of a substantial number of small rural hospitals. This
analysis must conform to the provisions of section 604 of the RFA. For
purposes of section 1102(b) of the Act, we define a small rural
hospital as a hospital that is located outside of a Metropolitan
Statistical Area (MSA) and has fewer than 100 beds. We have determined
that this notice will not have a significant effect on the operations
of a substantial number of small rural hospitals. Therefore, we are not
preparing an analysis for section 1102(b) of the Act.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule that may result in expenditure in any 1 year by State,
local, or tribal governments, in the aggregate, or by the private
sector, of $120 million. This notice has no consequential effect on
State, local, or tribal governments or on the private sector. However,
States are required to pay the premiums for dually-eligible
beneficiaries.
Executive Order 13132 establishes certain requirements that an
agency must meet when it publishes 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. This notice will not have a substantial effect on State
or local governments.
In accordance with the provisions of Executive Order 12866, this
regulation was reviewed by the Office of Management and Budget.
Authority: Sections 1818(d)(2) and 1818A(d)(2) of the Social
Security Act (42 U.S.C. 1395i-2(d)(2) and 1395i-2a(d)(2)).
(Catalog of Federal Domestic Assistance Program No. 93.773,
Medicare--Hospital Insurance)
Dated: September 26, 2007.
Kerry Weems,
Acting Administrator, Centers for Medicare & Medicaid Services.
Dated: September 26, 2007.
Michael O. Leavitt,
Secretary.
[FR Doc. 07-4909 Filed 10-1-07; 11:18 am]
BILLING CODE 4120-01-P