[Federal Register: May 23, 2008 (Volume 73, Number 101)]
[Notices]
[Page 30112-30128]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr23my08-66]
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DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-2273-N2 and CMS-2265-N]
RIN 0938-AO99 and 0938-APO7
State Children's Health Insurance Program (SCHIP); Retrospective
Adjustment for Additional Allotments To Eliminate Fiscal Year (FY) 2007
Funding Shortfalls; Final SCHIP Allotments for FYs 2008 and 2009;
Redistribution of Unused SCHIP FY 2005 Allotments To Eliminate FY 2008
Funding Shortfalls; Additional Allotments To Eliminate FY 2008 Funding
Shortfalls; and Provisions for Continued Authority for Qualifying
States To Use a Portion of Certain SCHIP Funds for Medicaid
Expenditures
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Notice.
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SUMMARY: This notice describes the implementation of certain funding
provisions under title XXI of the Social Security Act (SCHIP) as
amended by the Medicare, Medicaid, and SCHIP Extension Act of 2007
(MMSEA), (Pub. L. 110-173), and other related SCHIP legislation. These
funding provisions include: The retrospective adjustment of the
additional allotments to eliminate fiscal year (FY) 2007 SCHIP funding
shortfalls; the final FYs 2008 and 2009 SCHIP allotments; the
redistribution of the amounts of States' unused FY 2005 allotments to
eliminate FY 2008 SCHIP funding shortfalls; the provision of additional
allotments to eliminate FY 2008 SCHIP funding shortfalls; and the
provision for ``qualifying States'' to elect to use a portion of their
available SCHIP allotments as increased Federal matching funds for
certain expenditures in their Medicaid programs under title XIX of the
Act.
DATES: Effective Date: This notice is effective on June 23, 2008. The
allotments set forth in this notice are available for expenditures on
or after the start of the identified fiscal year to which they pertain.
FOR FURTHER INFORMATION CONTACT: Richard Strauss, (410) 786-2019.
SUPPLEMENTARY INFORMATION
I. Background
A. Availability and Redistribution of SCHIP Fiscal Year Allotments
Title XXI of the Social Security Act (the Act) sets forth the State
Children's Health Insurance Program (SCHIP) to enable States, the
District of Columbia, and specified Commonwealths and Territories to
initiate and expand health insurance coverage to uninsured, low-income
children. The 50 States, the District of Columbia, and the
Commonwealths and Territories may implement the SCHIP through a
separate child health program under title XXI of the Act, an expanded
Medicaid program under Title XIX of the Act, or a combination of both.
Federal funds appropriated for Title XXI are limited, and the law
specifies a formula to divide the total annual appropriation into
individual allotments available for each State, the District of
Columbia, and each U.S. Territory and Commonwealth with an approved
child health plan.
Section 2104(b) of the Act requires States, the District of
Columbia, and U.S. Territories and Commonwealths to have an approved
child health plan for the fiscal year in order for the Secretary to
provide an allotment for that fiscal year.
Section 2104(e) of the Act specifies that in general the SCHIP
allotments for a Federal fiscal year are available for payment to
States for their expenditures under an approved State child health plan
for an initial 3-fiscal year period of availability, including the
fiscal year for which the allotment was provided. Section 2104(f) of
the Act specifies that in general the amounts of States' allotments
which are not expended during the initial 3-year period of availability
are to be redistributed to those States that have fully spent these
fiscal year allotments during this period of availability in accordance
with an appropriate procedure determined by the Secretary. Furthermore,
section 2104(e) of the Act specifies that the amounts of the
redistributed allotments continue to be available for expenditure by
the States receiving these redistributions to the end of the fiscal
year in which these funds are redistributed.
[[Page 30113]]
B. Enactment of the National Institutes of Health Reform Act, the U.S.
Troop Readiness, Veteran's Care, Katrina Recovery, and Iraq
Accountability Appropriations Act, and Special Rules for Addressing FY
2007 SCHIP Funding Shortfalls
Under section 2104(e) and (f) of the Act, in general any unexpended
SCHIP allotments remaining following the end of the initial 3-year
period of availability would otherwise be redistributed in accordance
with an appropriate procedure determined by the Secretary. However,
section 201(a) of the National Institutes of Health Reform Act of 2006
(NIHRA) (Pub. L. 109-482, enacted on January 15, 2007) amended the
SCHIP statute to add a new section 2104(h) of the Act. This legislation
provided for special rules to address States' FY 2007 SCHIP funding
shortfalls. Specifically, in order to address States' FY 2007 SCHIP
funding shortfalls, section 2104(h)(1) of the Act provided for the
redistribution in FY 2007 of the unexpended FY 2004 allotments
remaining at the end of FY 2006. Furthermore, section 2104(h)(2) of the
Act provided for the redistribution in months after March 31, 2007 of
certain amounts of unexpended FY 2005 allotments. On May 29, 2007, we
published a notice in the Federal Register (72 FR 29502) describing the
implementation of section 201(a) of the NIHRA and containing the
amounts of the States' redistributed FY 2004 and FY 2005 allotments,
determined in accordance with the NIHRA legislation.
In accordance with the methodology established under NIHRA, the
amounts of the States' projected FY 2007 shortfalls, and the associated
FY 2004 and FY 2005 redistributed allotments, were determined on a
monthly basis to address the FY 2007 shortfalls. Since the total
amounts of the FY 2004 and FY 2005 allotments available for
redistribution were limited (to about $146.9 million and $137.8
million, respectively), the total FY 2007 shortfalls for the 6 States
receiving the redistributions were not fully addressed. The total
amounts of the FY 2004 and FY 2005 redistributed allotments that were
provided to the six recipient States were only sufficient to address
the States' FY 2007 shortfalls experienced through May 2007. These
amounts were not sufficient to cover the States' remaining FY 2007
shortfalls occurring in months after May 2007; nor were these amounts
sufficient to address other States' FY 2007 projected shortfalls
occurring after May 2007.
On May 29, 2007, the U.S. Troop Readiness, Veteran's Care, Katrina
Recovery, and Iraq Accountability Appropriations Act, 2007 (UTRA),
(Pub. L. 110-28) was enacted; in particular, title VII of this law
amended section 2104(h) of the Act (as amended by NIHRA), to provide
for additional allotment amounts to fund States' remaining SCHIP
funding shortfalls in FY 2007.
Under paragraph 2104(h)(7) of the Act as amended by the NIHRA, the
special rules for the redistribution of the unexpended FY 2004 and FY
2005 allotments in FY 2007 to address FY 2007 SCHIP funding shortfalls
apply only to a State that receives an allotment for FY 2007 under
section 2104(b) of the Act. Under section 2104(b) of the Act,
allotments are made only to the 50 States and the District of Columbia.
Therefore, section 2104(h) of the Act, as amended by NIHRA and as
further amended by UTRA, does not apply to the Commonwealths and
Territories, which received SCHIP allotments for FY 2007 under the
authority of section 2104(c) of the Act. Accordingly, unless otherwise
indicated in this notice, in referring to the redistribution of the FY
2004 and FY 2005 allotments or the additional allotments for
eliminating FY 2007 shortfalls, the term ``State'' means only the 50
States and the District of Columbia, as applicable.
On December 19, 2007 we published a notice in the Federal Register
(72 FR 71915) which indicated the amounts of States' additional
allotments to eliminate SCHIP funding shortfalls in FY 2007. These
additional allotments were determined based on the most recent data
available prior to the end of FY 2007. As indicated in that notice,
under section 2104(h)(5) of the Act a retrospective adjustment may be
applied with respect to the amounts of the redistributions and
additional shortfall allotments the States' received in FY 2007 to
eliminate the FY 2007 shortfalls based on States' actual FY 2007 SCHIP-
related expenditures reported no later than November 30, 2007. Section
II of this notice contains the final additional FY 2007 shortfall
allotments determined based on the retrospective adjustment provision
of section 2104(h)(5) of the Act.
C. Enactment of Continuing Appropriations and Medicare, Medicaid, and
SCHIP Extension Act of 2007
The continuing appropriation legislation enacted on September 29,
2007 (Pub. L. 110-92) contained provisions to extend funding under the
SCHIP through November 16, 2007. In particular, section 136(a) of
Public Law 110-92 appropriated $5 billion for the purposes of providing
FY 2008 allotments to the 50 States, the District of Columbia, and the
Commonwealths and Territories. Additionally, $40 million was
appropriated by this section to provide additional allotments to the
Commonwealths and Territories in FY 2008. Section 136(b) of Public Law
110-92 provided that the FY 2008 allotments be determined in accordance
with the same methodology as previous SCHIP fiscal year allotments were
determined. Section 136(c) of Public Law 110-92 amended the SCHIP
statute to add a new section 2104(i) of the Act to provide for the
redistribution in FY 2008 of the unexpended FY 2005 allotments
remaining at the end of FY 2007 to those 50 States or the District of
Columbia that had estimated shortfalls in FY 2008. Finally, section 106
of Public Law 110-92 provided that the FY 2008 allotment funds were
only available for States' SCHIP expenditures for assistance provided
through November 16, 2007.
Subsequent to the enactment of Public Law 110-92, further
continuing appropriation legislation was enacted which extended the
dates through which the FY 2008 allotment funds were available as
provided in section 106 of Public Law 110-92; in particular, Public Law
110-116 (enacted on November 13, 2007), Public Law 110-137 (enacted on
December 14, 2007), and Public Law 110-149 (enacted on December 21,
2007) extended the dates to December 14, 2007, December 21, 2007, and
December 31, 2007, respectively.
Section 201 of MMSEA amended section 2104(a) of the SCHIP statute
to explicitly provide funding for SCHIP allotments in the amount of $5
billion for each of FYs 2008 and 2009 for the 50 States and the
District of Columbia and the Commonwealths and Territories, and for $40
million for the Commonwealths and Territories for each of FYs 2008 and
2009. These allotments would be determined in accordance with the
existing methodology in SCHIP statute for fiscal years prior to FY
2008. The funding provided for FY 2008 under the Continuing
Appropriation Acts discussed above and enacted prior to MMSEA would no
longer be available (and thus expenditures for FY 2008 would be paid
from the MMSEA allotments). MMSEA provides that the FY 2008 and FY 2009
allotment funds were only available for expenditures through March 31,
2009.
Section 201 of MMSEA amended SCHIP statute to add section 2104(j)
of the Act which appropriates $1.6 billion for the purpose of providing
additional
[[Page 30114]]
allotments to eliminate States' SCHIP shortfalls in FY 2008.
D. Expenditures, Authority for Qualifying States To Use Available SCHIP
Allotments for Medicaid Expenditures
Under section 2105(a)(1)(A) through (D) and (a)(2) of the Act, and
before enactment of Public Law 108-74 (Extension of Availability of
SCHIP Allotment Act, enacted on August 15, 2003), only Federal payments
for the following Medicaid and SCHIP expenditures were applied against
States' available SCHIP allotments: (1) Medical assistance provided
under Title XIX (Medicaid) to targeted low-income children in a SCHIP-
related Medicaid expansion, for which the enhanced SCHIP Federal
Medical assistance program (FMAP) rate is available; (2) medical
assistance provided on behalf of a child during a period of presumptive
eligibility under section 1920A of the Act (these funds are matched at
the regular Medicaid FMAP rate); (3) child health assistance to
targeted low-income children that meets minimum benefit requirements
under SCHIP; and (4) expenditures in SCHIP that are subject to the 10-
percent limit on non-primary expenditures (including other child health
assistance for targeted low-income children, health services
initiatives, outreach, and administrative costs).
Section 1(b) of Public Law 108-74, as amended by Public Law 108-127
(Social Security Act, Technical corrections, enacted November 17,
2003), added new section 2105(g) to the Act under which certain
``qualifying States'' that met prescribed criteria could elect to use
up to 20 percent of any of the States' available SCHIP allotments for
FY 1998, 1999, 2000, or 2001 to increase the FMAP rate for regular
Medicaid expenditures to the enhanced FMAP rate available under SCHIP.
As described in the Federal Register published on July 23, 2004 (69 FR
44013), if a qualified State submitted both 20 percent allowance
expenditures and other ``regular'' SCHIP expenditures at the same time
in a quarter, the 20 percent allowance expenditures would be applied
first against the available fiscal year reallotments. However, the 20
percent allowance expenditures could be applied only against the
specified fiscal year allotment funds (upon which the 20 percent
allowances were based) and which would remain available. Under section
2104(g)(1)(B)(iii) of the Act, the amounts of States' FY 2001
reallotments would only be available through the end of FY 2005;
therefore, the FY 2001 20 percent allowances for the qualifying States
are only available through the end of FY 2005.
Section 6103 of the Deficit Reduction Act of 2005 (Pub. L. 109-171,
enacted on February 8, 2006) amended section 2105(g) of the Act to
provide for continued authority for qualifying States to use a portion
of their available FY 2004 and FY 2005 SCHIP allotments to allow the
use of the enhanced (FMAP) rate (as determined under section 2105(b) of
the Act) for certain expenditures made under the Medicaid program.
Section 201(b) of the NIHRA amended section 2105(g) of the Act to
provide for continued authority for qualifying States to use a portion
of their available FY 2006 and FY 2007 SCHIP allotments to allow the
use of the enhanced Federal Medical assistance percentage (FMAP) rate
(as determined under section 2105(b) of the Act) for certain
expenditures made under the Medicaid program.
Finally, section 201(b) of MMSEA amended 2105(g) of the Act to
provide for continued authority for qualifying States to use a portion
of their available FY 2008 and FY 2009 SCHIP allotments to allow the
use of the enhanced Federal Medical assistance percentage (FMAP) rate
(as determined under section 2105(b) of the Act) for certain
expenditures made under the Medicaid program. Thus, MMSEA provides that
the FY 2008 and FY 2009 allotment funds were only available for
expenditures through March 31, 2009.
II. Provisions of This Notice
The purpose of this notice is to: Describe the retrospective
adjustment for the FY 2007 shortfall funding; set forth the FY 2008 and
FY 2009 allotments for the 50 States and the District of Columbia, and
the U.S. Commonwealths and Territories; describe the methodology and
process used to implement the MMSEA provisions for eliminating States'
SCHIP funding shortfalls in FY 2008 including the determination of FY
2005 redistributions and the additional FY 2008 allotments; and
describe the implementation of the continued authority for ``qualifying
States'' to elect to receive a portion of certain of their available FY
2008 and FY 2009 SCHIP allotments as increased Federal matching funds
for certain expenditures in their Medicaid programs.
A. Retrospective Adjustment of FY 2007 Shortfall Allotments
Section 2104(h)(5) of the Act, as amended by NIHRA and UTRA,
provides for a potential retrospective adjustment with respect to the
amounts of States' FY 2004 and FY 2005 redistributed funds and FY 2007
shortfall allotments provided to them in FY 2007 and based on
expenditure reports for FY 2007 submitted no later than November 30,
2007. Prior to the end of FY 2007 and based on States' estimated FY
2007 SCHIP expenditures, we had provided approximately $616.0 million
in total additional FY 2007 shortfall allotments to States with
projected FY 2007 shortfalls. However, based on the States' actual FY
2007 expenditures, as submitted through November 30, 2007, the actual
shortfalls after the provisions of the FY 2004 and FY 2005
redistributed allotments in FY 2007 totaled only to approximately
$528.2 million. Therefore, there was approximately $87.8 million
($616.0 million minus $528.2 million) in excess FY 2007 shortfall
allotments provided to States in FY 2007 to address FY 2007 shortfalls;
this $87.8 million represents the total of the amounts of retrospective
adjustments that will be made to the FY 2007 shortfall allotments made
under the provisions of section 2104(h)(5) of the Act. Since States
still had $528.2 million in shortfalls in FY 2007 without consideration
of the FY 2007 shortfall allotments, we will not make any retrospective
adjustments to the FY 2004 and FY 2005 redistributed allotments made in
FY 2007. Table 1 in this notice presents the final FY 2007 shortfall
allotments after making the retrospective adjustment under section
2104(h)(5) of the Act.
B. Final FY 2008 and FY 2009 Allotments
Initially, section 136 of the continuing appropriation legislation
(Pub. L. 110-92) appropriated $5.0 billion for the purpose of providing
FY 2008 allotments to the 50 States and the District of Columbia and
the Commonwealths and Territories, and $40 million for the purpose of
providing additional allotments to the Commonwealths and Territories.
Subsequently, this authority was replaced by the provisions of section
201 of MMSEA, which amended section 2104(a)(11) of the Act to
appropriate $5.0 billion for each of FYs 2008 and 2009 for the purpose
of providing FY 2008 and FY 2009 allotments to the 50 States and the
District of Columbia and the Commonwealths and Territories, and $40
million for each of FYs 2008 and 2009 for the purpose of providing
additional allotments to the Commonwealths and Territories in FYs 2008
and 2009. As described in detail below, the FYs 2008 and 2009
allotments are determined in
[[Page 30115]]
accordance with the same methodology as applicable to the calculation
of SCHIP fiscal year allotments prior to FY 2008. Under section
201(a)(2) of the MMSEA, the FYs 2008 and 2009 allotments are not
available for States' expenditures for child health assistance for
items and services furnished after March 31, 2009.
Section 2104(a) of the Act provides that, for purposes of providing
allotments to the 50 States and the District of Columbia, the following
amounts are appropriated: $4,295,000,000 for FY 1998; $4,275,000,000
for each FY 1999 through FY 2001; $3,150,000,000 for each FY 2002
through FY 2004; $4,050,000,000 for each FY 2005 through FY 2006; and
$5,000,000,000 for FY 2007. Additionally, as amended by MMSEA, section
2104(a)(11) of the Act appropriates $5,000,000,000 for each of FY 2008
and FY 2009. However, under section 2104(c) of the Act, 0.25 percent of
the total amount appropriated each year is available for allotment to
the U.S. Territories and Commonwealths of Puerto Rico, Guam, the Virgin
Islands, American Samoa, and the Northern Mariana Islands. The total
amounts are allotted to the U.S. Territories and Commonwealths
according to the following percentages: Puerto Rico, 91.6 percent;
Guam, 3.5 percent; the Virgin Islands, 2.6 percent; American Samoa, 1.2
percent; and the Northern Mariana Islands, 1.1 percent.
Section 2104(c)(4)(B) of the Act provides for additional amounts
for allotment to the Territories and Commonwealths: $34,200,000 for
each FY 2000 through FY 2001; $25,200,000 for each FY 2002 through FY
2004; $32,400,000 for each FY 2005 through FY 2006; and $40,000,000 for
FY 2007. Additionally, as amended by MMSEA, $40,000,000 is appropriated
for additional allotments for the Commonwealths and Territories for
each of FY 2008 and FY 2009. Since, for FY 2008 and FY 2009, title XXI
of the Act provides an additional $40,000,000 for allotment to the U.S.
Territories and Commonwealths, the total amount available for allotment
to the U.S. Territories and Commonwealths in FY 2008 and FY 2009 is
$52,500,000; that is, $40,000,000 plus $12,500,000 (0.25 percent of the
FY 2008/2009 appropriation of $5,000,000,000).
Therefore, the total amount available nationally for allotment for
the 50 States and the District of Columbia for FY 2008 and FY 2009 was
determined in accordance with the following formula:
AT = S2104(a) - T2104(c)
AT = Total amount available for allotment to the 50
States and the District of Columbia for the fiscal year.
S2104(a) = Total appropriation for the fiscal year
indicated in section 2104(a) of the Act. For FY 2008 and FY 2009,
this is $5,000,000,000.
T2104(c) = Total amount available for allotment for the
U.S. Territories and Commonwealths; determined under section 2104(c)
of the Act as 0.25 percent of the total appropriation for the 50
States and the District of Columbia. For FY 2008 and FY 2009, this
is: .0025 x $5,000,000,000 = $12,500,000.
Therefore, for each of FY 2008 and FY 2009, the total amount available
for allotment to the 50 States and the District of Columbia is
$4,987,500,000. This was determined as follows:
AT ($4,987,500,000) = S2104(a) ($5,000,000,000) -
T2104(c) ($12,500,000)
For purposes of the following discussion, the term ``State,'' as
defined in section 2104(b)(1)(D)(ii) of the Act, ``means one of the 50
States or the District of Columbia.''
Under section 2104(b) of the Act, the determination of the number
of children applied in determining the SCHIP allotment for a particular
fiscal year is based on the three most recent March supplements to the
Current Population Survey (CPS) of the Bureau of the Census officially
available before the beginning of the calendar year in which the fiscal
year begins. The determination of the State cost factor is based on the
annual average wages per employee in the health services industry,
which is determined using the most recent 3 years of such wage data as
reported and determined as final by the Bureau of Labor Statistics
(BLS) of the Department of Labor to be officially available before the
beginning of the calendar year in which the fiscal year begins. Since
FY 2008 begins on October 1, 2007 (that is, in calendar year 2007), in
determining the FY 2008 SCHIP allotments, we are using the most recent
official data from the Bureau of the Census and the BLS, respectively,
available before January 1 of calendar year 2007 (that is, through the
end of December 31, 2006). Similarly, with respect to the FY 2009 SCHIP
allotment we are using the most recent official data from the Census
and the BLS, respectively, available before January 1 of calendar year
2008 (that is, through the end of December 31, 2007).
1. Number of Children
For FY 2008, as specified by section 2104(b)(2)(A)(iii) of the Act,
the number of children is calculated as the sum of 50 percent of the
number of low-income, uninsured children in the State, and 50 percent
of the number of low-income children in the State. The number of
children factor for each State is developed from data provided by the
Bureau of the Census based on the standard methodology used to
determine official poverty status and uninsured status in the annual
CPS on these topics. As part of a continuing formal process between the
Centers for Medicare & Medicaid Services (CMS) and the Bureau of the
Census, each fiscal year we obtain the number of children data
officially from the Bureau of the Census.
Under section 2104(b)(2)(B) of the Act, the number of children for
each State (provided in thousands) was determined and provided by the
Bureau of the Census based on the arithmetic average of the number of
low-income children and low-income children with no health insurance as
calculated from the three most recent March supplements to the CPS
officially available from the Bureau of the Census before the beginning
of the 2007 calendar year. In particular, through December 31, 2006,
the most recent official data available from the Bureau of the Census
on the numbers of children were data from the three March CPSs
conducted in March 2004, 2005, and 2006 (representing data for years
2003, 2004, and 2005). Similarly, for the FY 2009 SCHIP allotments the
most recent official data available from the Bureau of the Census on
the numbers of children were data from the three March CPSs conducted
in March 2005, 2006, and 2007 (representing data for years 2004, 2005,
and 2006).
2. State Cost Factor
The State cost factor is based on annual average wages in the
health services industry in the State. The State cost factor for a
State is equal to the sum of: 0.15 and 0.85 multiplied by the ratio of
the annual average wages in the health industry per employee for the
State to the annual wages per employee in the health industry for the
50 States and the District of Columbia.
Under section 2104(b)(3)(B) of the Act, as amended by the Balanced
Budget Refinement Act of 1999 (BBRA) Public Law 106-113, enacted on
November 29, 1999, the State cost factor for each State for a fiscal
year is calculated based on the average of the annual wages for
employees in the health industry for each State using data for each of
the most recent 3 years as reported and determined as final by the BLS
in the Department of Labor and available before the beginning of the
calendar year in which the fiscal year begins. Therefore, the State
cost factor for FY 2008 is based on the most recent
[[Page 30116]]
3 years of BLS data officially available as final before January 1,
2007 (the beginning of the calendar year in which FY 2008 begins); that
is, it is based on the BLS data available as final through December 31,
2006. In accordance with these requirements, we used the final State
cost factor data available from BLS for 2003, 2004, and 2005 in
calculating the FY 2008 final allotments. Similarly, for the FY 2009
allotments we used the final State cost factor data available from BLS
for 2004, 2005, and 2006.
The State cost factor is determined based on the calculation of the
ratio of each State's average annual wages in the health industry to
the national average annual wages in the health care industry. Since
BLS is required to suppress certain State-specific data in providing us
with the State-specific average wages per health services industry
employee due to the Privacy Act, we calculated the national average
wages directly from the State-specific data provided by BLS. As part of
a continuing formal process between CMS and the BLS, each fiscal year
CMS obtains these wage data officially from the BLS.
Section 2104(b)(3)(B) of the Act, as amended by the BBRA, refers to
wage data as reported by BLS under the ``Standard Industrial
Classification'' (SIC) system. However, in calendar year 2002, BLS
phased-out the SIC wage and employment reporting system and replaced it
with the ``North American Industry Classification System'' (NAICS). In
accordance with section 2104(b)(3)(B) of the Act, for purposes of
calculating the FY 2008 allotments, BLS provided wage data for the 3
most recent years as available through December 31, 2006; in this case,
the 3 years of wage data are 2003, 2004, and 2005. Because of the wage
and employment classification change at BLS, the BLS wage data used in
calculating the FY 2008 SCHIP allotments necessarily reflect NAICS
data, rather than SIC data, to obtain the 3-year average required for
the allotments. Similarly, for purposes of calculating the FY 2009
SCHIP allotments, BLS provided wage data for the 3 most recent years as
available through December 31, 2007; in this case, the 3 years of wage
data are 2004, 2005, and 2006.
Under the SIC system, BLS provided CMS with wage data for each
State under the SIC Code. However, the wage data codes under the SIC
system do not map exactly to the wage data codes under the NAICS. As a
result, BLS provided us with wage data using three NAICS wage data
codes that represent approximately 98 percent of the wage data that
would have been provided under the related SIC Code 80. Specifically,
in lieu of SIC Code 80 data, BLS provided CMS data that are based on
the following three NAICS codes: NAICS Code 621 (Ambulatory health care
services), Code 622 (Hospitals), and Code 623 (Nursing and residential
care facilities).
Under section 2104(b)(4) of the Act, each State and the District of
Columbia is allotted a ``proportion'' of the total amount available
nationally for allotment to the States. The term ``proportion'' is
defined in section 2104(b)(4)(D)(i) of the Act and refers to a State's
share of the total amount available for allotment for any given fiscal
year. In order for the entire total amount available to be allotted to
the States, the sum of the proportions for all States must exactly
equal one. Under the statutory definition, a State's proportion for a
fiscal year is equal to the State's allotment for the fiscal year
divided by the total amount available nationally for allotment for the
fiscal year. In general, a State's allotment for a fiscal year is
calculated by multiplying the State's proportion for the fiscal year by
the national total amount available for allotment for that fiscal year
in accordance with the following formula:
SAi = Pi x AT
SAi = Allotment for a State or District of Columbia for a
fiscal year.
Pi = Proportion for a State or District of Columbia for a
fiscal year.
AT = Total amount available for allotment to the 50
States and the District of Columbia for the fiscal year. For each FY
2008 and FY 2009, this is $4,987,500,000.
In accordance with the statutory formula for determining
allotments, the State proportions are determined under two steps, which
are described below in further detail.
Under the first step, each State's proportion is calculated by
multiplying the State's Number of Children and the State Cost Factor to
determine a ``product'' for each State. The products for all States are
then summed. Finally, the product for a State is divided by the sum of
the products for all States, thereby yielding the State's preadjusted
proportion.
3. Application of Floors and Ceiling
Under the second step, the preadjusted proportions are subject to
the application of proportion floors, ceiling, and a reconciliation
process, as appropriate. The SCHIP statute specifies three proportion
floors, or minimum proportions, that apply in determining States'
allotments. The first proportion floor is equal to $2,000,000 divided
by the total of the amount available nationally for the fiscal year.
This proportion ensures that a State's minimum allotment would be
$2,000,000. The second proportion floor is equal to 90 percent of the
allotment proportion for the State for the previous fiscal year; that
is, a State's proportion for a fiscal year must not be lower than 10
percent below the previous fiscal year's proportion. The third
proportion floor is equal to 70 percent of the allotment proportion for
the State for FY 1999; that is, the proportion for a fiscal year must
not be lower than 30 percent below the FY 1999 proportion.
Each State's allotment proportion for a fiscal year is also limited
by a maximum ceiling amount, equal to 145 percent of the State's
proportion for FY 1999; that is, a State's proportion for a fiscal year
must be no higher than 45 percent above the State's proportion for FY
1999. The floors and ceiling are intended to minimize the fluctuation
of State allotments from year to year and over the life of the program
as compared to FY 1999. The floors and ceiling on proportions are not
applicable in determining the allotments of the U.S. Territories and
Commonwealths; they receive a fixed percentage specified in the statute
of the total allotment available to the U.S. Territories and
Commonwealths.
As determined under the first step for determining the States'
preadjusted proportions, which is applied before the application of any
floors or ceiling, the sum of the proportions for all the States and
the District of Columbia will be equal to exactly one. However, the
application of the floors and ceiling under the second step may change
the proportions for certain States; that is, some States' proportions
may need to be raised to the floors, while other States' proportions
may need to be lowered to the maximum ceiling. If this occurs, the sum
of the proportions for all States and the District of Columbia may not
exactly equal one. In that case, the statute requires the proportions
to be adjusted, under a method that is determined by whether the sum of
the proportions is greater or less than one.
The sum of the proportions would be greater than one if the
application of the floors and ceiling resulted in raising the
proportions of some States (due to the application of the floors) to a
greater degree than the proportions of other States were lowered (due
to the application of the ceiling). If, after application of the floors
and ceiling, the sum of the proportions is greater than one, the
statute requires the Secretary to determine a maximum percentage
increase limit, which, when applied to
[[Page 30117]]
the State proportions, would result in the sum of the proportions being
exactly one.
If, after the application of the floors and ceiling, the sum of the
proportions is less than one, the statute requires the States'
proportions to be increased in a ``pro rata'' manner so that the sum of
the proportions again equals one. Finally, it is also possible,
although unlikely, that the sum of the proportions (after the
application of the floors and ceiling) will be exactly one; in that
case, the proportions would require no further adjustment.
4. Determination of Preadjusted Proportions
The following is an explanation of how we applied the two State-
related factors specified in the statute to determine the States'
``preadjusted'' proportions for FY 2008 and FY 2009. The term
``preadjusted,'' as used here, refers to the States' proportions before
the application of the floors and ceiling and adjustments, as specified
in the SCHIP statute. The determination of each State and the District
of Columbia's preadjusted proportion for both FY 2008 and FY 2009 is in
accordance with the following formula:
PPi = (Ci x SCFi)/ ?(Ci
x SCFi).
PPi = Preadjusted proportion for a State or District of
Columbia for a fiscal year.
Ci = Number of children in a State (section
2104(b)(1)(A)(i) of the Act) for a fiscal year. This number is based
on the number of low-income children for a State for a fiscal year
and the number of low-income uninsured children for a State for a
fiscal year determined on the basis of the arithmetic average of the
number of such children as reported and defined in the three most
recent March supplements to the CPS of the Bureau of the Census,
officially available before the beginning of the calendar year in
which the fiscal year begins. (See section 2104(b)(2)(B) of the
Act.)
For FYs 2008 and 2009, the number of children is equal to the
sum of 50 percent of the number of low-income uninsured children in
the State for the fiscal year and 50 percent of the number of low-
income children in the State for the fiscal year. (See section
2104(b)(2)(A)(iii) of the Act.)
SCFi = State Cost Factor for a State (section
2104(b)(1)(A)(ii) of the Act). For a fiscal year, this is equal to:
0.15 + 0.85 x (Wi/WN).
Wi = The annual average wages per employee for a State
for such year (section 2104(b)(3)(A)(ii)(I) of the Act).
WN = The annual average wages per employee for the 50
States and the District of Columbia (section 2104(b)(3)(A)(ii)(II)
of the Act).
The annual average wages per employee for a State or for all
States and the District of Columbia for a fiscal year is equal to
the average of such wages for employees in the health services
industry, as reported and determined as final by the BLS of the
Department of Labor for each of the most recent 3 years officially
available before the beginning of the calendar year in which the
fiscal year begins. (See section 2104(b)(3)(B) of the Act).
(Ci x SCFi) = The sum of the products of (Ci x SCFi) for each State
(section 2104(b)(1)(B) of the Act).
The resulting proportions would then be subject to the application
of the floors and ceiling specified in the SCHIP statute and
reconciled, as necessary, to eliminate any deficit or surplus of the
allotments because the sum of the proportions was either greater than
or less than one.
Section 2104(e) of the Act requires that the amounts allotted to a
State for a fiscal year be available to the State for a total of 3
years; the fiscal year for which the amounts are allotted, and the 2
following fiscal years.
Table 2 and Table 3 in this notice present the FY 2008 and FY 2009
SCHIP allotments, respectively, determined in accordance with section
2104 of the Act.
C. FY 2005 Redistributed Allotments and Additional Allotments to
Eliminate States' SCHIP funding shortfalls in FY 2008
Section 2104(i)(1) and (2) of the Act, as amended by section 136(c)
of Public Law 110-92 specifies the methodology for determining the
amounts of States' redistributions of the unexpended FY 2005 allotments
remaining at the end of FY 2007.
In general, section 2104(f) of the Act provides for the Secretary
to determine an appropriate procedure to redistribute the entire amount
of States' unexpended SCHIP allotments following the end of the related
initial 3-year period of availability only to those States that fully
expended the allotments by the end of the initial 3-year period of
availability. However, section 2104(i) of the Act as added by section
136(c) of Public Law 110-92, specifies the application of special rules
for the redistribution of the unexpended FY 2005 allotments in FY 2008
with respect to certain ``shortfall States.'' As described below, the
procedure for redistribution of States' unexpended FY 2005 allotments
remaining at the end of FY 2007 is in accordance with the provisions of
section 2104(i) of the Act relating to the elimination of funding
shortfalls in the SCHIP in FY 2008.
Under section 2104(i)(2) of the Act, a shortfall State is a State
with an approved child health plan under Title XXI of the Act, for
which the Secretary estimates, on a monthly basis using the most recent
data available to the Secretary, that the State's projected FY 2008
expenditures under this plan will exceed the sum of:
The amount of the State's allotments for each of FY's 2006
and 2007 that were not expended by the end of FY 2007 and remain
available in FY 2008;
The amount of the State's allotment for FY 2008.
In determining the amount of any unexpended FY 2005 allotments that
might be redistributed to address a State's FY 2008 SCHIP funding
shortfall, we first determined the amount, if any, of each State's FY
2005 allotments that were not expended by the end of FY 2007 based on
the States' quarterly expenditure reports (Forms CMS-21 and CMS-64) as
submitted and certified by States through November 30, 2007. We also
determined the amounts of each States' unexpended FY 2006 and FY 2007
allotments that were not expended by the end of FY 2007, also based on
States' quarterly expenditure reports (Forms CMS-21 and CMS-64) as
submitted and certified by States through November 30, 2007. The
amounts of the States' allotments for FY 2008 are as published in this
Federal Register.
For purposes of calculating the FY 2005 redistribution amounts, we
initially based the determination of the amounts of States' projected
FY 2008 expenditures using the States' most recent estimates for such
expenditures available as of the date of the enactment of Public Law
100-92, September 29, 2007; that is, we used the States' estimates of
their FY 2008 expenditures obtained from their certified submissions of
their August 2007 quarterly report forms CMS-21b and CMS-37. Using that
data, we had projected that States would not face shortfalls in FY 2008
until sometime in December 2007. Since section 2104(i)(2) of the Act
requires that we determine the shortfall status of States on a monthly
basis using the most recent data available for such purpose, we
subsequently used the States' updated estimates of their FY 2008
expenditures contained in their certified submissions of their November
30, 2007 quarterly report Forms CMS-21b and CMS-37 to determine the
States' FY 2008 funding shortfalls on a monthly basis for the months of
December 2007 and following months through March 2008 (the month
through which the FY 2005 redistributed allotments were exhausted). In
accordance with section 2104(i)(4) of the Act, if the amounts of the
unexpended FY 2005 allotments available for redistribution are less
than the total amounts of the estimated
[[Page 30118]]
shortfalls determined for a month, the amount of the FY 2005
redistribution for that month must be reduced proportionally. This was
the basis for determining the amount of the March 2008 FY 2005
redistributions. Table 4 provides the monthly determination and total
of the FY 2005 redistributed allotments for the months of December 2007
through March 2008.
As indicated, the FY 2005 redistributed allotments determined under
section 2104(i) of the Act were insufficient to fully eliminate the
States' FY 2008 funding shortfalls; however, section 201(c) of MMSEA
added a new section 2104(j) of the Act. Under that section, $1.6
billion was appropriated for purposes of providing additional
allotments to eliminate FY 2008 funding shortfalls for the 50 States
and the District of Columbia; it also provides for certain amounts of
that appropriation to be available for additional allotment to the
Commonwealths and Territories.
In particular, section 2104(j)(2) of the Act, as amended by MMSEA,
provides for additional allotment amounts to eliminate the FY 2008
SCHIP funding shortfalls remaining after the redistribution of the
unexpended FY 2005 allotments in FY 2008, both for States that received
the FY 2005 redistributions, as well as for other States that did not
receive such redistributions, but which also have projected FY 2008
shortfalls. Under section 2104(j)(2) of the Act, a ``shortfall State''
is defined as a State for which the Secretary estimates on the basis of
the most recent data available to the Secretary as of November 30, 2007
that the projected FY 2008 Federal SCHIP expenditures will exceed the
sum of:
The amounts of the State's allotments for FY 2006 and FY
2007 that were not expended by the end of FY 2007.
The amounts, if any, of the FY 2005 allotments that were
redistributed to the State in FY 2008, in accordance with section
2104(i) of the Act (as described above).
The amount of the State's allotment for FY 2008.
Furthermore, section 2104(j)(3) of the Act, as amended by MMSEA,
provided for certain amounts to be provided as additional FY 2008
allotments to the Commonwealths and Territories. In particular, 1.05
percent of the sum of the FY 2008 shortfall allotments for the 50
States and the District of Columbia (determined as indicated above) is
available for additional allotments to the Commonwealths and
Territories. This total amount is allocated to each Commonwealth/
Territory in accordance with the percentage specified in section
2104(c)(3) of the Act.
Finally, under the retrospective adjustment provisions sections
2104(i)(5) and 2104(j)(5) of the Act, the Secretary may adjust the
determinations of the FY 2005 redistributed allotments and the
additional FY 2008 allotments, respectively, on the basis of actual
expenditures for FY 2008 reported by States not later than November 30,
2008 on the Forms CMS-64 or CMS-21.
Table 5 indicates the calculation of the additional FY 2008
shortfall allotments to the 50 States and the District of Columbia, and
to the Commonwealths and Territories.
D. Ordering of Expenditures
In applying States' expenditures against their available SCHIP
allotments, expenditures are ordered in accordance with the provisions
of section 2105(a)(1)(A) through (D) and 2105(a)(2) of the Act as
follows:
Title XIX SCHIP-related expenditures for which payment is
made at the enhanced FMAP (section 2105(a)(1)(A) of the Act);
Title XIX expenditures for medical assistance provided
during a presumptive eligibility period under section 1920A of the Act
(section 2105(a)(1)(B) of the Act);
Child health assistance for targeted low-income children
in the form of providing health benefits coverage that meets the
requirements of section 2103 (per section 2105(a)(1)(C) of the Act);
Expenditures listed in section 2105(a)(1)(D)(i) through
(iv) of the Act, respectively: Other child health assistance for
targeted low-income children; health services initiatives under the
plan for improving the health of children (including targeted low-
income children and other low-income children); expenditures for
outreach activities; and administration expenditures.
In accordance with the ordering of allotments and expenditures
provisions described above, for FY 2008 the expenditures of States will
be applied against the FY 2006 and FY 2007 SCHIP allotments carried
over into FY 2008, the FY 2008 allotments, the FY 2005 redistributed
allotments, and the additional FY 2008 shortfall allotments.
E. No Ordering Election for Amounts of States' FY 2005 Redistributed
Allotments and FY 2008 Shortfall Allotments
In the past, for purposes of applying States' expenditures against
the redistributed allotments, States receiving redistributed allotment
amounts were given flexibility to decide the ordering of the
redistributed allotments with respect to the States' other available
allotments. This allowed the redistribution States to optimize the use
of these redistributed funds. However, because of the statutory
provisions made by the MMSEA on the identification of shortfall States
and the determination of the amount of the funding shortfalls on a
monthly basis, and the requirement that these redistributed allotments
and additional allotments be available only after the States' other
SCHIP allotment funds have been exhausted, we believe that the FY 2005
redistributed allotments and the additional FY 2008 allotments must be
ordered after the States' other available allotments are exhausted.
Therefore, shortfall States must spend their available FY 2006, FY
2007, and FY 2008 allotments first, before any amounts of redistributed
FY 2005 allotments and FY 2008 shortfall allotments. Furthermore, since
the FY 2008 shortfall allotments are only available for any remaining
FY 2008 shortfalls, the FY 2005 redistributed allotments must be
ordered prior to any FY 2008 shortfall allotments.
As specified in section 2104(i)(6) of the Act (as amended by
section 136(c) of Pub. L. 110-92), the amounts of the unexpended FY
2005 allotments redistributed to a State in FY 2008, and the amounts of
the FY 2008 shortfall allotments (as specified in section 2104(j)(6) of
the Act (as amended by MMSEA) are only available for expenditure by the
State through September 30, 2008; and, any amounts of these
redistributed allotments or additional allotments remaining at the end
of FY 2008 shall not be subject to redistribution under section 2104(f)
of the Act.
The amounts of the FY 2005 redistributed allotment amounts, and the
amounts of the additional FY 2008 shortfall allotments, will be
incorporated into the Form CMS-21C (Allocation of Title XIX and Title
XXI Expenditures to the SCHIP Fiscal Year Allotment). Form CMS-21C is
used for tracking States' expenditures against their available SCHIP
allotments. The Medicaid and SCHIP expenditure system will then
automatically apply expenditures reported on the quarterly expenditure
reports for FY 2008 against all of the SCHIP allotment funds available
in FY 2008.
IV. Tables
Following are the keys and associated tables for the SCHIP funding
provisions as discussed in previous sections:
Table 1. Retrospective Adjustment for the FY
[[Page 30119]]
2007 Shortfall Funding
Table 2. Final FY 2008 Allotments
Table 3. Final FY 2009 Allotments
Table 4. Redistribution of Unexpended FY 2005 Allotments
Table 5. Additional FY 2008 Allotments
A. Table 1--Retrospective Adjustment for FY 2007 Shortfall Funding
Key to Table 1
Column/Description
Column A = State. Column A contains the name of the State, District
of Columbia, U.S. Commonwealth or Territory.
Column B = Final FY 2007 Expenditures Reported 11/30/07. Column B
contains the final FY 2007 expenditures as reported and certified by
States on the Forms CMS-21 and CMS-64 through November 30, 2007.
Column C = NET FY 2005 Allotments. Column C contains the ``net'' FY
2005 allotment for each State remaining after the application of
section 2104(h)(3) of the Act. Under that provision, for specified
States identified in section 2104(h)(3)(A) of the Act, certain amounts
of their unexpended FY 2005 allotments in FY 2007 became unavailable to
such States on and after April 1, 2007; such amounts were effectively
``contributed'' as an FY 2005 redistribution in FY 2007 to certain
States with SCHIP funding shortfalls in FY 2007. The implementation of
this provision was described in the Federal Register published on May
29, 2007 (72 FR 29502). The amount of the net FY 2005 allotment
remaining after the application of the provisions of section 2104(h)(3)
of the Act and available to each State for expenditure in FY 2007 is
contained in Column C.
Column D = FY 2006 Allotments C/O Fr. FY 2006. Column D contains
the amount of the unexpended FY 2006 allotments remaining at the end of
FY 2006 and available for expenditure in FY 2007.
Column E = FY 2007 Allotments. Column D contains the full amount of
each state's FY 2007 allotment available for expenditure in FY 2007, as
contained in the Federal Register published on July 28, 2006 (71 FR
42854).
Column F = Tot. Allots in FY 07 NOT Incl. FY 04/05 Redists. C + D +
E. Column F contains the total SCHIP allotment funds for each State
available for expenditure in FY 2007 not including any FY 2004 or FY
2005 redistributed allotments, calculated as the sum of the amounts in
Column C, D, and E.
Column G = Tot. FY 07 SF Before Redist. Or Addt'l Allots. B-F. For
States with projected expenditures for FY 2007 in Column B that are in
excess of their available SCHIP allotment funds in F, Column G contains
the shortfall in SCHIP funds in FY 2007 calculated as the amount in
Column B minus the amount in Column F.
Column H = For SF States FY 2004 Redistributions u/NIHRA. For
States with a projected FY 2007 shortfall in SCHIP funds in Column G,
Column H contains the total FY 2004 redistribution provided to such
State in FY 2007 as determined in accordance with the provisions of
section 2104(h)(1) of the Act and as contained in the Federal Register
published on May 29, 2007 (72 FR 29502).
Column I = For SF States FY 2005 Redistributions u/NIHRA. For
States with a projected FY 2007 shortfall in SCHIP funds in Column G,
Column H contains the total FY 2005 redistribution provided to such
State in FY 2007 as determined in accordance with the provisions of
section 2104(h)(2) of the Act and as contained in the Federal Register
published on May 29, 2007 (72 FR 29502).
Column J = Tot. FY 04/05 Redist. Amounts. H + I. Column J contains
the total of the FY 2004 and FY 2005 redistributed allotments available
to each State in FY 2007, calculated as the sum of the amounts in
Column H and Column I.
Column K = Retro Adjusted FY 07 SF Allot After Redist. G-J. For
States with FY 2007 shortfalls before the provision of any FY 2004 and
FY 2005 redistributions as indicated in Column G, and for which such
shortfalls are greater than the total available FY 2004 and FY 2005
redistributed allotments as indicated in Column J, Column K contains
the final remaining shortfall for the State, calculated as the amount
of the shortfall in Column G minus the amount of the total FY 2004 and
FY 2005 redistributions in Column J; the amount in Column K represents
the amount of the final retrospective adjustment for the FY 2007
shortfall allotment, determined under the purview of section 2104(h)(5)
of the Act.
[[Page 30120]]
[GRAPHIC] [TIFF OMITTED] TN23MY08.002
B. Table 2 Final FY 2008 Allotments and Table 3 Final FY 2009
Allotments
Key to Table 2 and Table 3
Column/Description
Column A = State. Column A contains the name of the State, District
of Columbia, U.S. Commonwealth or Territory.
Column B = Number of Children. Column B contains the number of
children for each State (provided in thousands) was determined and
provided by the Bureau of the Census based on the arithmetic average of
the number of low-income children and low-income uninsured children,
and is based on the three most recent March supplements to the CPS of
the Bureau of the Census officially available before the beginning of
the calendar year in which the fiscal year begins. The FY 2008
allotments were based on the 2004, 2005, and 2006 March supplements to
the CPS; the FY 2009 allotments were based on the 2005, 2006, and 2007
March supplements to the CPS. These data represent the number of people
in each State under 19 years of age whose family income is at or below
200 percent of the poverty threshold appropriate for that family, and
who are reported to be without health insurance coverage. The number of
children for each State was developed by the Bureau of the Census based
on the standard methodology used to determine official poverty status
and uninsured status in its annual March CPS on these topics.
For FY 2008 and FY 2009, the number of children is equal to the sum
of 50 percent of the number of low-income uninsured children in the
State and 50 percent of the number of low-income children in the State.
Column C = State Cost Factor. Column C contains the State cost
factor for a State is equal to the sum of: 0.15, and 0.85 multiplied by
the ratio of the annual average wages in the health industry per
employee for the State to the annual wages per employee in the health
industry for the 50 States and the District of Columbia. The State cost
factor for each State was calculated based on such wage data for each
State as reported and determined as final by the BLS in the Department
of Labor for each of the most recent 3 years and available before the
beginning of the calendar year in which the fiscal year begins. The FY
2008 allotments were based on final BLS wage data for 2003, 2004, and
2005; the FY 2009 allotments were based on final BLS wage data for
2004, 2005, and 2006.
Column D = Product. Column D contains the Product for each State
was calculated by multiplying the Number of Children in Column B by the
State Cost Factor in Column C. The sum of the Products for all 50
States and the District of Columbia is below the Products for each
State in Column D. The Product for each State and the sum of the
Products for all States provides the basis for allotment to States and
the District of Columbia.
Column E = Proportion of Total. Column E contains the calculated
percentage share for each State of the total allotment available to the
50 States and the District of Columbia. The Percent Share of Total is
calculated as the ratio of the Product for each State in Column D to
the sum of the Products for all 50 States and the District of Columbia
below the Products for each State in Column D.
Column F = Adjusted Proportion of Total. Column F contains the
calculated percentage share for each State of the total allotment
available after the application of the floors and ceiling and after any
further reconciliation needed to ensure that the sum of the State
proportions is equal to one. The three floors specified in the statute
are: (1) The percentage calculated by dividing $2,000,000 by the total
of the amount available for all allotments for the fiscal year; (2) an
annual floor of 90 percent
[[Page 30121]]
of (that is, 10 percent below) the preceding fiscal year's allotment
proportion; and (3) a cumulative floor of 70 percent of (that is, 30
percent below) the FY 1999 allotment proportion. There is also a
cumulative ceiling of 145 percent of (that is, 45 percent above) the FY
1999 allotment proportion.
Column G = Allotment. Column G contains the SCHIP allotment for
each State, Commonwealth, or Territory for the fiscal year. For each of
the 50 States and the District of Columbia, this is determined as the
Adjusted Proportion of Total in Column F for the State multiplied by
the total amount available for allotment for the 50 States and the
District of Columbia for the fiscal year.
For each of the U.S. Territories and Commonwealths, the allotment
is determined as the Proportion of Total in Column E multiplied by the
total amount available for allotment to the U.S. Territories and
Commonwealths. For the U.S. Territories and Commonwealths, the
Proportion of Total in Column E is specified in section 2104(c) of the
Act. The total amount is then allotted to the U.S. Territories and
Commonwealths according to the percentages specified in section 2104 of
the Act. There is no adjustment made to the allotments of the U.S.
Territories and Commonwealths as they are not subject to the
application of the floors and ceiling. As a result, Column F in the
table, the Adjusted Proportion of Total, is empty for the U.S.
Territories and Commonwealths.
BILLING CODE 4120-01-P
[[Page 30122]]
[GRAPHIC] [TIFF OMITTED] TN23MY08.003
[[Page 30123]]
[GRAPHIC] [TIFF OMITTED] TN23MY08.004
[[Page 30124]]
C. Table 4--Redistribution of Unexpended FY 2005 Allotments
Table 4 contains the amounts, if any, of each State's FY 2005
redistributed allotment determined in accordance with section 2104(i)
of the Act, as amended by section 136(c) of Public Law 110-92. Under
this provision, in FY 2008 the redistribution of the unexpended FY 2005
allotments remaining at the end of FY 2007 was determined on a monthly
basis using the States' projected FY 2008 expenditures as compared to
their other allotments available in FY 2008 to determine States'
projected monthly shortfalls in FY 2008. The unexpended FY 2005
allotments were applied towards meeting these projected State FY 2008
monthly shortfalls.
Key to Table 4
Column/Description
Column A = State. Column A contains the name of the State.
Column B = FY 2005 Redistribution for December 2007. Column B
contains the amount if any of the State's FY 2005 redistributed
allotment for the month of December 2007, determined in accordance with
the provisions of section 2104(i) of the Act.
Column C = FY 2005 Redistribution for January 2008. Column C
contains the amount if any of the State's FY 2005 redistributed
allotment for the month of January 2008, determined in accordance with
the provisions of section 2104(i) of the Act.
Column D = FY 2005 Redistribution for February 2008. Column D
contains the amount if any of the State's FY 2005 redistributed
allotment for the month of February 2008, determined in accordance with
the provisions of section 2104(i) of the Act.
Column E = FY 2005 Redistribution for March 2008. Column E contains
the amount if any of the State's FY 2005 redistributed allotment for
the month of March 2008, determined in accordance with the provisions
of section 2104(i) of the Act.
Column F = Total FY 2005 Redistribution. B + C + D + E. Column F
contains the total amount if any of the State's FY 2005 redistributed
allotment in FY 2008, calculated as the sum of the amounts in Columns
B, C, D and E, representing the amounts of such redistributions for the
months of December 2007, and January, February, and March of 2008,
respectively.
[[Page 30125]]
[GRAPHIC] [TIFF OMITTED] TN23MY08.005
[[Page 30126]]
D. Table 5--Determination of the Additional FY 2008 Shortfall
Allotments
Key to Table 5--ADDITIONAL FY 2008 ALLOTMENTS TO ELIMINATE THE
REMAINING FY 2008 SHORTFALLS
Table 5 presents the determination of the amounts of the additional
FY 2008 shortfall allotments to eliminate the shortfalls remaining in
FY 2008 for the 50 States and DC based on the most recent expenditure
projections for FY 2008, after the provision of the FY 2005
redistributed allotments. It also presents the determination of the
additional FY 2008 allotments provided to the Commonwealths and
Territories.
Column/Description
Column A = State. Column A contains the name of the State, District
of Columbia, the Commonwealth or Territory.
Column B = Total Expenditures FY 2008. Column B contains the
projected FY 2008 Federal expenditures based on the submissions by
State through November 30, 2007.
Column C = Carryover FY 06 & 07 Allotments Avail. in FY 08. Column
C contains the total unexpended FY 2006 and FY 2007 allotments
remaining at the end of FY 2007 and carried over into and available in
FY 2008.
Column D = FY 2008 Allotments. Column D contains the amounts of the
50 States' and District of Columbia FY 2008 allotments (same as in
Table 2).
Column E = FY 2005 Redistribution. Column E contains the total FY
2005 redistributed allotments determined in accordance with section
2104(i) of the Act (same as in Table 4).
Column F = FY 2008 Total Available Allotments. Column F contains
the total allotment funds available to each State in FY 2008,
calculated as the sums of the amounts in Columns C, D, and E.
Column G = FY 2008 Shortfall/FY 2008 SF Allotment. B-F. For the 50
States and the District of Columbia, Column G contains the
determination of the shortfall (if any) in SCHIP funding for each State
in FY 2008 after the application of the projected expenditures for FY
2008 against the total allotments available in FY 2008, calculated as
the amount in Column B minus the amount in Column F. For the 50 States
and the District of Columbia, the amount in Column G represents the
amount of the FY 2008 shortfall allotment to eliminate the FY 2008
shortfall in SCHIP funding. For the Commonwealths and Territories the
amount in Column G is the additional FY 2008 allotment. The aggregate
amount available for additional allotment to the Commonwealths and
Territories ($12,164,562) is calculated as 1.05 percent of the total
projected FY 2008 shortfalls ($1,158,529,602).
[[Page 30127]]
[GRAPHIC] [TIFF OMITTED] TN23MY08.006
BILLING CODE 4120-01-C
[[Page 30128]]
IV. Regulatory Impact Statement
We have examined the impact of this rule 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 Social Security Act, the Unfunded Mandates
Reform Act of 1995 (Pub. L. 104-4) and Executive Order 13132 on
Federalism, and the Congressional Review Act (5 U.S.C. 804(2)).
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
significant effects ($100 million or more in any one year). We have
determined that this notice is economically significant. However, this
notice only announces the availability of such allotment funds
determined that were calculated based on methodologies specified in
statute and does not put forward any discretionary administrative
policies. Therefore, we have determined that there are no policy
options that require an analysis beyond that which is presented in
section II. above.
The RFA requires agencies to analyze options for regulatory relief
of small businesses if a rule. For purposes of the RFA, small entities
include small businesses, nonprofit organizations, and small
governmental jurisdictions. Most hospitals and most other providers and
suppliers are small entities, either by nonprofit status or by having
revenues of less than $6.5 million to $31.5 million in any 1 year.
Individuals and States are not included in the definition of a small
entity. We are not preparing an analysis for the RFA because we have
determined that this notice will not have a significant economic impact
on a substantial number of small entities.
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 Core-Based
Statistical Area and has fewer than 100 beds. We are not preparing an
analysis for section 1102(b) of the Act because we have determined that
this notice will not have a significant impact on the operations of a
substantial number of small rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. That threshold
level is currently approximately $125 million. This notice will not
create an unfunded mandate on States, tribal, or local governments.
Therefore, we are not required to perform an assessment of the costs
and benefits of this notice.
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. We have reviewed this notice and have determined that it
does not significantly affect States' rights, roles, and
responsibilities.
Low-income children will benefit from payments under this program
through increased opportunities for health insurance coverage. We
believe this notice will have an overall positive impact by informing
States, the District of Columbia, and Commonwealths and Territories of
the extent to which they are permitted to expend funds under their
child health plans using the additional FY 2007 shortfall allotment
amounts.
In accordance with the provisions of Executive Order 12866, this
notice was reviewed by the Office of Management and Budget.
V. Waiver of Notice of Proposed Rulemaking and Delay in Effective Date
We ordinarily publish a proposed notice in the Federal Register to
provide a period of public comment before the provisions of a notice,
such as this, are effective in accordance with section 553(b) of the
Administrative Procedure Act (APA) (5 U.S.C. 553(b)). We also
ordinarily provide a 30-day delay in the effective date of the
provisions of a notice in accordance with section 553(d) of the APA (5
U.S.C 553(d)). However, we can waive both the notice of proposed
rulemaking and the 30-day delay in effective date if the Secretary
finds, for good cause, that it is impracticable, unnecessary, or
contrary to the public interest, and incorporates a statement of the
finding and the reasons in the notice.
We find there is good cause to waive notice of proposed rulemaking
and the delay in the effective date of this issuance of the SCHIP
funding provisions and associated methodologies because the delay
required for a notice of proposed rulemaking and the delay in the
effective date would be contrary to the public interest because the
pressing financial needs faced by some States mean that such delays
could result in disruption of program operations.
We determined the amounts of the FY 2008 SCHIP funds discussed in
this notice as expeditiously as possible in order to make them
available to the States as soon as possible. We believe that this was
necessary to minimize any disruption in program operations that could
result if States did not have secure funding commitments. In
determining the amounts of the FY 2008 SCHIP funds discussed in this
notice, we used State FY 2007 expenditures and FY 2008 projected
Federal expenditures as contained in the most recent available States'
quarterly expenditure and budget report submissions as certified by the
States through November 30, 2007. The FY 2008 allotments, the FY 2005
redistributed allotments, and the additional FY 2008 allotments make
available Federal funds to all States, and particularly shortfall
States that may need these funds to continue program operations.
We are waiving notice of proposed rulemaking and the 30-day delay
in effective date, and are publishing this issuance of the Federal
Register as a notice.
In accordance with the provisions of this notice, we have
determined the amounts of the FY 2008 SCHIP funding provisions
contained in this notice are effective immediately upon publication of
this notice.
Authority: Section 1102 of the Social Security Act (42 U.S.C.
1302).
(Catalog of Federal Domestic Assistance Program No. 93.778, Medical
Assistance Program)
(Catalog of Federal Domestic Assistance Program No. 93.767, State
Children's Health Insurance Program)
Dated: April 1, 2008.
Kerry Weems,
Acting Administrator, Centers for Medicare & Medicaid Services.
Dated: April 29, 2008.
Michael O. Leavitt,
Secretary.
[FR Doc. E8-11612 Filed 5-22-08; 8:45 am]
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