[Code of Federal Regulations]
[Title 42, Volume 3]
[Revised as of October 1, 2002]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR457.216]

[Page 367-368]
 
                         TITLE 42--PUBLIC HEALTH
 
  CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF 
                 HEALTH AND HUMAN SERVICES--(Continued)
 
PART 457--ALLOTMENTS AND GRANTS TO STATES--Table of Contents
 
 Subpart B--General Administration--Reviews and Audits; Withholding for 
  Failure to Comply; Deferral and Disallowance of Claims; Reduction of 
                        Federal Medical Payments
 
Sec. 457.216  Treatment of uncashed or canceled (voided) SCHIP checks.

    (a) Purpose. This section provides rules to ensure that States 
refund the Federal portion of uncashed or canceled (voided) checks under 
title XXI.
    (b) Definitions. As used in this section--
    Canceled (voided) check means an SCHIP check issued by a State or 
fiscal agent that prior to its being cashed is canceled (voided) by the 
State or fiscal agent, thus preventing disbursement of funds.
    Fiscal agent means an entity that processes or pays vendor claims 
for the SCHIP agency.
    Uncashed check means an SCHIP check issued by a State or fiscal 
agent that has not been cashed by the payee.

[[Page 368]]

    Warrant means an order by which the SCHIP agency or local agency 
without the authority to issue checks recognizes a claim. Presentation 
of a warrant by the payee to a State officer with authority to issue 
checks will result in release of funds due.
    (c) Refund of Federal financial participation (FFP) for uncashed 
checks--(1) General provisions. If a check remains uncashed beyond a 
period of 180 days from the date it was issued; that is, the date of the 
check, it is no longer regarded as an allowable program expenditure. If 
the State has claimed and received FFP for the amount of the uncashed 
check, it must refund the amount of FFP received.
    (2) Report of refund. At the end of each calendar quarter, the State 
agency must identify those checks that remain uncashed beyond a period 
of 180 days after issuance. The SCHIP agency must refund all FFP that it 
received for uncashed checks by adjusting the Quarterly Statement of 
Expenditures for that quarter. If an uncashed check is cashed after the 
refund is made, the State may file a claim. The claim will be considered 
to be an adjustment to the costs for the quarter in which the check was 
originally claimed. This claim will be paid if otherwise allowed by the 
Act and the regulations issued in accordance with the Act.
    (3) If the State does not refund the appropriate amount as specified 
in paragraph (c)(2) of this section, the amount will be disallowed.
    (d) Refund of FFP for canceled (voided) checks--(1) General 
provisions. If the State has claimed and received FFP for the amount of 
a canceled (voided) check, it must refund the amount of FFP received.
    (2) Report of refund. At the end of each calendar quarter, the SCHIP 
agency must identify those checks that were canceled (voided). The State 
must refund all FFP that it received for canceled (voided) checks by 
adjusting the Quarterly Statement of Expenditures for that quarter.
    (3) If the State does not refund the appropriate amount as specified 
in paragraph (d)(2) of this section, the amount will be disallowed.