[Code of Federal Regulations]
[Title 12, Volume 1]
[Revised as of January 1, 2003]
From the U.S. Government Printing Office via GPO Access
[CITE: 42CFR433.120]

[Page 87]
 
                         TITLE 42--PUBLIC HEALTH
 
  CHAPTER IV--CENTERS FOR MEDICARE & MEDICAID SERVICES, DEPARTMENT OF 
                 HEALTH AND HUMAN SERVICES--(Continued)
 
PART 433--STATE FISCAL ADMINISTRATION--Table of Contents
 
   Subpart C--Mechanized Claims Processing and Information Retrieval 
                                 Systems
 
Sec. 433.120  Procedures for reduction of FFP after reapproval review.

    (a) If CMS determines after the reapproval review that the system no 
longer meets the conditions of reapproval in Sec. 433.119, CMS will 
reduce FFP for system operations for at least four quarters. However, no 
system will be subject to reduction of FFP for at least the first four 
quarters after the quarter in which the system is initially approved as 
eligible for 75 percent FFP.
    (b) CMS will reduce FFP in expenditures for system operations from 
75 percent to no more than 70 percent and no less than 50 percent; 
however, CMS will not reduce FFP by more than 10 percentage points in 
any four-quarter period. The percentage to which the FFP is reduced will 
depend primarily on the following criteria:
    (1) The number of conditions judged unsatisfactory;
    (2) The extent to which conditions were not met;
    (3) The significance of the unsatisfactory conditions in overall 
mechanized claims processing and information retrieval system 
operations; and
    (4) The actual and potential program impact attributable to the 
unsatisfactory conditions.

[50 FR 30848, July 30, 1985, as amended at 54 FR 41974, Oct. 13, 1989]