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| Montana Administrative Register Notice 37-512 | No. 10 05/27/2010 | |
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BEFORE THE DEPARTMENT OF PUBLIC HEALTH AND HUMAN SERVICES OF THE STATE OF
TO: All Concerned Persons 1. On June 24, 2010, at 1:30 p.m., the Department of Public Health and Human Services will hold a public hearing in the auditorium of the Department of Public Health and 2. The Department of Public Health and Human Services will make reasonable accommodations for persons with disabilities who wish to participate in this rulemaking process or need an alternative accessible format of this notice. If you require an accommodation, contact Department of Public Health and Human Services no later than 5:00 p.m. on June 14, 2010, to advise us of the nature of the accommodation that you need. Please contact Rhonda Lesofski, Department of Public Health and Human Services, Office of Legal Affairs, 3. The rules as proposed to be adopted provide as follows: RULE I MEDICAID FOR WORKERS WITH DISABILITIES: DEFINITIONS The following definitions apply to this subchapter: (1) "Employed" means engaged in work for which the individual receives or seeks to receive income, either as an employee or as a self-employed person. An individual is considered to be employed only if Medicare and social security taxes are withheld from the income received for the work or, in the case of a self-employed individual, if the individual pays Medicare and social security taxes on any income received for the work. (2) "Family" means the individual applying for or receiving Medicaid and any relative or relatives who reside with the individual and whose income and resources are deemed available to the individual pursuant to the supplemental security income (SSI) regulations in 20 CFR, part 416, subparts K and L, as amended through May 17, 2010, which are adopted and incorporated by reference. 20 CFR part 416, subpart K, contains the SSI criteria for evaluating income, including the income of financially responsible relatives. 20 CFR, part 416, subpart L, contains the SSI criteria for evaluating resources, including the resources of financially responsible relatives. A copy of these federal regulations may be obtained from the Department of Public Health and Human Services, Human and Community Services Division, (3) "Gross income" means an individual's income before any deductions or disregards provided in 20 CFR, part 416, subpart K, are subtracted. (4) "Income" has the meaning provided in 20 CFR, part 416.1102 and 416.1103 as amended through May 17, 2010. (5) "Indian" means any person who is a member of an Indian tribe. (6) "Indian tribe" means any Indian tribe, band, nation, or other organized group or community, including any Alaskan native village or group or regional or village corporation as defined in or established pursuant to the Alaskan Native Claims Settlement Act, 43 USCS section 1601 et seq., that is recognized as eligible for the special programs and services provided by the United States to Indians because of their status as Indians. (7) "Retirement or pension fund or plan" means a fund or plan specifically established and earmarked for the sole purpose of providing financial resources for a person who is retired from gainful employment or who is no longer employed by a particular employer. Examples of a retirement or pension fund or plan are 457 plans, conventional 401(k) plans, SIMPLE 401(k) plans, employer-based defined benefit plans, Public Employee Retirement System (PERS) accounts for Montana state employees, thrift savings plan accounts for federal employees, section 403(b) plans, section 501(c)(18) plans, Keogh plans, individual retirement accounts (IRAs), Roth IRAs, SIMPLE IRAs, simplified employee pension (SEP) plans, employee profit sharing plans, and cash balance plans. AUTH: 53-6-113, MCA RULE II MEDICAID FOR WORKERS WITH DISABILITIES: APPLICABLE LAW (1) Except as specifically provided in this subchapter or in the Aged Blind Disabled (ABD) Medicaid Manual adopted and incorporated by reference in ARM 37.82.101, the Medicaid for Workers with Disabilities program shall be administered in accordance with Title XIX of the Social Security Act, 42 USC 1396, et seq. and ARM Title 37, chapter 5, chapter 82, subchapters 1, 2, and 4, chapter 85, chapter 86, chapter 87, chapter 88, and chapter 90. AUTH: 53-6-113, MCA RULE III MEDICAID FOR WORKERS WITH DISABILITIES: GENERAL ELIGIBILITY CRITERIA (1) An individual is eligible for benefits through the Medicaid for Workers with Disabilities program if the individual: (a) is employed; (b) has a disability as defined in 42 USC 1382c, except that the individual has or has had earnings above the level for substantial gainful activity; (c) has family income and resources that do not exceed the limits specified in [RULES IV and V]; (d) pays a cost-share amount as specified in [RULE VI]; and (e) satisfies all other eligibility requirements specified in the authorities cited in [Rule II]. AUTH: 53-6-113, MCA RULE IV MEDICAID FOR WORKERS WITH DISABILITIES: INCOME (1) An individual is eligible for benefits through the Medicaid for Workers with Disabilities program in regard to income if the individual's net family income is less than 250% of the 2010 U.S. Department of Health and Human Services poverty level for a family of that size. (2) The individual's net family income will be determined using the income provisions of the supplemental security income (SSI) regulations at 20 CFR, part 416, subpart K, as amended through May 17, 2010, and of the Aged Blind Disabled (ABD) Medicaid Manual adopted and incorporated by reference in ARM 37.82.101. 20 CFR, part 416, subpart K, which contains the SSI criteria for evaluating income, including the income of financially responsible relatives, is adopted and incorporated by reference. In case of a conflict between a provision of 20 CFR, part 416, subpart K, and a provision of the ABD Medicaid Manual, the provision of the Medicaid Manual shall apply. The ABD Medicaid Manual is available for public viewing at each local office of public assistance or at the Department of Public Health and Human Services, Human and Community Services Division, RULE V MEDICAID FOR WORKERS WITH DISABILITIES: RESOURCES (1) An individual is eligible in regard to resources if the individual's resources, including any resources of relatives deemed to be available to the individual pursuant to the supplemental security income (SSI) regulations at 20 CFR, part 416, subpart L, as amended through May 17, 2010, have a value of $8,000 or less. 20 CFR, part 416, subpart L, which contains the SSI criteria for evaluating resources, including the resources of financially responsible relatives, is adopted and incorporated by reference. A married individual who resides with his or her spouse is eligible in regard to resources if the resources of the individual and his or her spouse, including any resources of relatives deemed to be available to the individual pursuant to 20 CFR, part 416, subpart L, have a value of $12,000 or less. (2) Except as provided in (3) below, the individual's resources will be determined using the resource provisions of SSI regulations at 20 CFR, part 416, subpart L, and of the ABD Medicaid Manual adopted by reference in ARM 37.82.101. In case of a conflict between a provision of 20 CFR, part 416, subpart L, and a provision of the ABD Medicaid Manual, the provision of the Medicaid Manual shall apply. (3) Funds in a retirement or pension fund or plan are excluded as a resource. RULE VI MEDICAID FOR WORKERS WITH DISABILITIES: COST SHARE FEES (1) Except as provided in (2) below, an otherwise eligible individual must make a monthly cost share fee in accordance with the table in (3) below, as a condition of eligibility for benefits under the Medicaid for Workers with Disabilities program. The payment is based on the gross income of the individual only, not the individual's family income. The amount of the payment varies depending on what percentage of the federal poverty level for a family of one the individual's gross income represents. (2) Indians are not required to pay any cost share fee regardless of their income. (3) The amount of an individual's cost share fee will be determined using the following table:
4. The In 2009 the 61st Montana Legislature enacted Senate Bill 119 (SB 119) which authorizes the department to create a new Medicaid eligibility group known as Medicaid for Workers with Disabilities. SB 119 authorizes the department to adopt less stringent income and resource limits than are used to determine eligibility for other ABD Medicaid. The provisions of SB 119 are codified in 53-6-113(6), 53-6-131(11), and 53-6-195, MCA. The federal authority to provide coverage to this group is provided in the Balanced Budget Act (BBA) of 1997, codified at 42 USC, section 1396a(a)(10)(A)(ii)(XIII), which gives states the option of creating a Medicaid coverage group for individuals with disabilities who are employed so that they can work without losing their Medicaid coverage due to their earnings from employment. SB 119 requires the department to administer Medicaid for Workers with Disabilities in accordance with the provisions of the BBA at 42 USC, section 1396a(a)(10)(A)(ii)(XIII). SB 119 authorizes the department to provide coverage under this group to individuals whose net family income is less than 250% of the federal poverty levels (FPL) published by the U.S. Department of Health and Human Services, but it does not state how net family income is determined or what the resource limit for this group will be. It also does not define certain key terms such as "family" or "employed". It is therefore necessary to adopt rules to specify in more detail the policies that will apply in determining eligibility for this group. These rules will provide detailed guidance to employees of the department who determine eligibility for Medicaid and ensure that the same policies for determining eligibility are applied to all applicants for coverage under this group. The rules will also notify potential Medicaid recipients and other members of the public of the eligibility requirements for this coverage group. Rule I SB 119 requires that an individual be employed in order to receive benefits under this coverage group. The term "employed" is not defined in SB 119 or in the BBA, however. It is therefore necessary to define this term to ensure that all individuals administering the program give the same meaning to the term and to put members of the public on notice of how the department interprets this term. Proposed new Rule I defines the term "employed" broadly without imposing a minimum number of hours of employment or a minimum amount of earnings because the BBA does not permit the department to impose requirements more restrictive than the requirements of the supplemental security income (SSI) cash assistance program. SSI rules do not prescribe minimum work hours or earnings for purposes of determining whether an individual is employed. SSI rules do permit states to require proof of employment such as payment of Medicare and social security taxes, however. The department therefore has defined "employed" to include a requirement for payment of Medicare and social security taxes to prevent individuals who are not engaged in bona fide employment from qualifying for the program, which is intended to benefit employed individuals. For example, an individual who occasionally does odd jobs for a family member without paying any taxes on the money earned from such work would not qualify as employed under this definition. Although the BBA limits eligibility to individuals in families whose income is less than 250% of the FPL, the BBA does not define the term "family". The department has chosen to use the definition of family used in the SSI program, which includes a spouse with whom the individual resides as part of the individual's family, so that spousal income will be counted in determining eligibility for Medicaid for Workers with Disabilities. Some advocates for individuals with disabilities suggested that only the income of the person seeking Medicaid coverage be counted if the applicant was married, because this would allow more individuals to qualify for coverage. The department rejected this approach because it is not consistent with the policy applied in all other Medicaid coverage groups. Medicaid policy generally requires that the income of all financially responsible relatives with whom a person lives be counted in determining the person's eligibility. Thus, a spouse's income or a parent's income is always counted if the spouses live together or the parent lives with the child. This is fair because the spouse's or parent's income is available to help pay for necessities such as food and shelter that the individual otherwise would have to pay himself or herself, leaving more of the individual's income available to pay medical expenses. There is no reason to make an exception to the usual policy for this coverage group, which is already being given the benefit of significantly higher income and resource limits than other groups. The department is defining the term "retirement or pension plan or fund" broadly to include any type of fund or plan specifically designated for the sole purpose of providing financial resources for retirement or separation from a particular employer. The requirement that the funds or plan be solely for that purpose is included to ensure that funds in all savings and investment accounts do not qualify for exclusion. This would not be consistent with the reason for excluding retirement and pension funds and plans, which is to protect only money specifically earmarked for retirement from being spent prematurely on medical expenses. It is not necessary to include a definition of the term "net family income" because the term "family" is defined, and the rule provides that the individual's net family income will be determined in accordance with the rules of the SSI program. Rule II Although there are special criteria for determining eligibility for Medicaid for Workers with Disabilities that apply only to this coverage group, the general eligibility criteria applicable to other coverage groups apply except as otherwise specified. Additionally, the rules governing the provision of services to Medicaid recipients generally apply to this coverage group. Proposed new Rule II is therefore necessary to clarify that the rules and statutes applicable to other Medicaid coverage groups apply to Medicaid for Workers with Disabilities also. Rule III Proposed new Rule III summarizes the financial and nonfinancial eligibility requirements for Medicaid for Workers with Disabilities. This is necessary to apprise those administering the program and interested members of the public of the requirements to qualify for Medicaid under this coverage group. Rule IV Proposed new Rule IV sets an income limit for this coverage group, namely that the applicant's net family income must be below 250% of the FPL. This is the maximum amount of income that a participant is permitted to have under the BBA. The department chose this income limit, which is significantly higher than the maximum allowed for other Medicaid coverage groups, because disabled individuals who are working may have additional expenses related to their employment and should therefore be allowed to have more income without being penalized by the loss of their Medicaid coverage. Proposed new Rule IV further provides that net family income will be determined using the income provisions of the SSI regulations. The department chose to use the SSI rules to calculate net family income because these are the rules used to determine eligibility for other coverage groups serving the disabled population. The department has found that using different rules for similar programs or coverage groups leads to confusion among both the agency employees who administer the programs and participants in the programs. Conversely, consistency of policies among similar programs and coverage groups eliminates confusion and reduces errors in all programs and coverage groups. Additionally, the department decided not to use more liberal income disregards or other special rules to calculate net income for this group, because the income limit of 250% of FPL is high enough to make this unnecessary. Rule V Proposed new Rule V sets the resource (asset) limit for this coverage group at $8,000 for an unmarried individual and $12,000 for a married couple. These amounts are four times the resource limits used in the SSI program. The purpose of having higher resource limits is to allow workers with disabilities to reap the rewards of employment by being allowed to accumulate assets without being penalized. The department considered establishing resource limits that are twice the SSI limits but decided this was not generous enough. The department concluded that setting the resource at four times the SSI limits would allow participants to accumulate reasonable but not excessive amounts of property. The department rejected the option of having higher resource limits or no resource limits at all because it would benefit a person while the person was working and eligible under this coverage group but would disqualify the person from receiving Medicaid under a different coverage group if the person lost eligibility under this group. Since most people who work eventually stop working for one reason or another, such as retirement, health problems, layoffs, or voluntary job quit, having excessively high resource limits would be disadvantageous to participants in the long run because it would cause ineligibility for benefits under a different Medicaid coverage group when one of these events occurs. Also, having very high resource limits or no limits would create an unfair disparity between disabled workers and other aged, blind, or disabled individuals who are not working and who are subject to the SSI resource limits. Proposed new Rule V specifies that resources will be determined using the resource provisions of the SSI regulations and of the department's ABD Medicaid Manual and further provides that in the case of a conflict between a provision of the SSI regulations and a provision of the ABD Medicaid Manual the provision in the Medicaid Manual will be followed. In general the department uses the SSI rules to determine resource eligibility for individuals whose eligibility is based on being aged, blind, or disabled, although the department has adopted some policies that are more liberal than the SSI policies. The department has chosen to apply the same policies used for other aged, blind, and disabled coverage groups to this new coverage group to preserve consistency among Medicaid programs serving individuals with disabilities. The department has found that using different rules for similar programs or coverage groups leads to confusion among both the agency employees who administer the programs and participants in the programs. Conversely, consistency of policies among similar programs and coverage groups eliminates confusion and reduces errors in all programs and coverage groups. Additionally, the department decided not to use different, more liberal rules to calculate countable resources for this group because the resources limits have been set high enough to make this unnecessary. Proposed new Rule V specifies that funds in a retirement or pension fund or plan will not be counted in determining eligibility for this coverage group. The department has chosen to exclude these resources to maintain consistency with other coverage groups serving individuals with disabilities. Retirement and pension funds and plans are excluded because it is not desirable to force individuals to spend money they will need for their basic support in their old age or retirement on medical expenses. Rule VI Proposed new Rule VI contains the table that will be used to determine the amount of the cost share fee each individual will pay. The payment amount will be based on the gross income of the individual, rather than the individual's family income because this will result in the cost share fee being more closely related to the earnings of the individual with a disability. The payment table contains four income/payment brackets. In the first bracket, individuals with income of up to 100% of the FPL, that is, with monthly income of up to $903, will pay $35; individuals with income of over 100% to 150% of the FPL, that is, with monthly income of $903.01 to $1,354.00, will pay $75; individuals with income of over 150% to 200% of the FPL, that is, with monthly income of $1,354.01 to $1,805, will pay $125; and individuals with income of over 200% to 250% of the FPL, that is, with monthly income of $1,805.01 to $2,256, will pay $175. The department chose to set a single payment amount for a range of incomes rather than calculating an individual's payment as a percentage of the individual's income, because this method of determining the payment is easier for participants in the program as well as for the departmental employees administering the program. If the payment was a specified percentage of the individual's income, the payment would constantly be changing as the individual's income changed, which in turn would require the individual to report any change in income, however small, and would require departmental employees to recompute the payment and notify the individual of the new payment amount every time a change in income occurred. This would be burdensome for both participants and employees and would increase the likelihood of mistakes in the payment amount being made. Having four payment brackets ensures that the amount of the payment is related to the individual's income closely enough to be fair but also ensures that the payment amount would not change too frequently because each of the four brackets covers a fairly broad range of incomes. The amounts participants in the program will be required to pay were not determined like insurance premiums by having actuaries determine the exposure to risk and estimating the amounts participants must pay in order for the payments to cover the amount Medicaid will expend for participants. The department chose these payment amounts after studying the amounts participants in similar programs in other states are required to pay. The department determined that these amounts are reasonably related to the participant's income and are not so high as to be burdensome. Indians will not be required to pay any cost share fee because Section 5006 of the American Recovery and Reinvestment Act of 2009 provides that Indians receiving Medicaid cannot be required to pay cost sharing payments. The fiscal impact of these rules on participants Medicaid for Workers with Disabilities will begin on July 1, 2010 if the necessary approvals are received from the Centers for Medicare and Medicaid (CMS), the federal agency that oversees state Medicaid programs. It is estimated that 43 individuals will participate in the program in its first three months, July through September 2010, and it is estimated that these participants will pay cost share fees totaling $6,135. It is estimated that 254 individuals will participate in the program from October 1, 2010 through September 30, 2011 and that they will pay cost share fees totaling $145,980. It is estimated that the total spent for the program from July 1, 2010 through September 30, 2011 will be $282,960, of which $92,641 will be general fund dollars and $190,319 will be federal dollars. 5. The department intends to apply proposed new Rules I through VI retroactively to July 1, 2010. A retroactive application of the proposed new rules will have no negative impact on Medicaid applicants or recipients. 6. Concerned persons may submit their data, views, or arguments either orally or in writing at the hearing. Written data, views, or arguments may also be submitted to: Rhonda Lesofski, Department of Public Health and Human Services, Office of Legal Affairs, P.O. Box 4210, Helena, Montana, 59604-4210; fax (406) 444-9744; or e-mail dphhslegal@mt.gov, and must be received no later than 5:00 p.m., June 25, 2010. 7. The Office of Legal Affairs, Department of Public Health and Human Services, has been designated to preside over and conduct this hearing. 8. The department maintains a list of interested persons who wish to receive notices of rulemaking actions proposed by this agency. Persons who wish to have their name added to the list shall make a written request that includes the name, e-mail, and mailing address of the person to receive notices and specifies for which program the person wishes to receive notices. Notices will be sent by e-mail unless a mailing preference is noted in the request. Such written request may be mailed or delivered to the contact person in 6 above or may be made by completing a request form at any rules hearing held by the department. 9. An electronic copy of this proposal notice is available through the Secretary of State's web site at http://sos.mt.gov/ARM/Register. The Secretary of State strives to make the electronic copy of the notice conform to the official version of the notice, as printed in the Montana Administrative Register, but advises all concerned persons that in the event of a discrepancy between the official printed text of the notice and the electronic version of the notice, only the official printed text will be considered. In addition, although the Secretary of State works to keep its web site accessible at all times, concerned persons should be aware that the web site may be unavailable during some periods, due to system maintenance or technical problems. 10. The bill sponsor contact requirements of 2-4-302, MCA, apply and have been fulfilled. The primary bill sponsor was contacted by letter on May 13, 2010, sent postage prepaid via USPS, and by telephone and e-mail May 12, 2010.
/s/ Barbara Hoffmann /s/ Hank Rule Reviewer Anna Whiting Sorrell, Director Public Health and Human Services Certified to the Secretary of State May 17, 2010.
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