Medicaid Program; Fiscal Year Disproportionate Share Hospital Allotments and Disproportionate Share Hospital Institutions for Mental Disease Limits, 73831-73841 [E7-24486]

Download as PDF Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices Deadline for Nominations by Regular Mail: Friday, January 18, 2008 at 5 p.m., e.s.t. Deadline for Nominations by Electronic Mail: Friday, January 25, 2008 at 5 p.m., e.s.t. ADDRESSES: Regular Mail: Lynne G. Johnson, Office of External Affairs, Centers for Medicare & Medicaid Services, 7500 Security Boulevard, S1– 05–06, Baltimore, MD 21244–1850. Electronic Mail: Lynne.Johnson@cms.hhs.gov. FOR FURTHER INFORMATION CONTACT: Lynne G. Johnson, Health Insurance Specialist, Division of Forum and Conference Development, (410) 786– 0090. Please refer to the CMS Advisory Committees Information Line (1–877– 449–5659 toll free)/(410–786–9379 local) or the Internet (https:// www.cms.hhs.gov/FACA/04_APME.asp) for additional information and updates on committee activities, or contact Ms. Johnson via e-mail at Lynne.Johnson@cms.hhs.gov. Press inquiries are handled through the CMS Press Office at (202) 690–6145. SUPPLEMENTARY INFORMATION: mstockstill on PROD1PC66 with NOTICES DATES: I. Background Section 9(a)(2) of the Federal Advisory Committee Act authorizes the Secretary of Health and Human Services (the Secretary) to establish an advisory panel if the Secretary determines that the panel is ‘‘in the public interest in connection with the performance of duties imposed * * * by law.’’ Section 1804 of the Social Security Act (the Act) requires the Secretary to provide informational materials to Medicare beneficiaries about the Medicare program, and section 1851(d) of the Act, requiring the Secretary to provide for ‘‘activities * * * to broadly disseminate information to Medicare beneficiaries * * * on the coverage options provided under [Medicare Advantage] in order to promote an active, informed selection among such options.’’ To help inform these activities, section 1114(f) of the Act and section 222 of the Public Health Service Act (42 U.S.C. 217a) authorize the creation of an advisory panel. The Secretary signed the charter establishing this Panel on January 21, 1999 and approved the renewal of the charter on November 14, 2006. The establishment of the charter and the renewal of charter were announced in the February 17, 1999 Federal Register (64 FR 7899), and the March 23, 2007 Federal Register (72 FR 13796), respectively. The Panel advises and makes recommendations to the Secretary and the Administrator of the Centers for Medicare & Medicaid Services (the Administrator) on VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 opportunities to enhance the effectiveness of consumer education strategies concerning the Medicare program. The Secretary delegates authority to the Administrator. The goals of the Panel are as follows: • To provide recommendations on the development and implementation of a national Medicare education program that describes the options for selecting a health plan and prescription drug benefits under Medicare. • To enhance the Federal government’s effectiveness in informing the Medicare consumer, including the appropriate use of public-private partnerships. • To make recommendations on how to expand outreach to vulnerable and underserved communities, including racial and ethnic minorities, in the context of a national Medicare education program. • To assemble an information base of best practices for helping consumers evaluate health plan options and build a community infrastructure for information, counseling, and assistance. The Panel shall consist of a maximum of 20 members. The Chair shall either be appointed from among the 20 members, or a Federal official will be designated to serve as the Chair. The charter requires that meetings shall be held approximately 4 times per year. Members will be expected to attend all meetings. The members and the Chair shall be selected from authorities knowledgeable in the fields of senior citizen advocacy; outreach to minority communities; health communications; disease-related health advocacy; disability policy and access; health economics research; health insurers and plans; providers and clinicians; labor and retirement, and web education. Members of the general public are invited to apply. This notice is an invitation to interested organizations or individuals to submit their nominations for membership on the Panel. The Secretary or his designee will appoint new members to the Panel from among those candidates determined to have the expertise required to meet specific agency needs and in a manner to ensure an appropriate balance of membership. II. Nomination Requirements Each nomination must state that the nominee has expressed a willingness to serve as a Panel member and must be accompanied by a resume or description of the nominee’s experience and a brief biographical summary. In order to permit an evaluation of possible sources of conflict of interest, potential candidates will be asked to provide PO 00000 Frm 00075 Fmt 4703 Sfmt 4703 73831 detailed information concerning such matters as financial holdings, consultancies, and research grants or contracts. Self-nominations will also be accepted. All nominations must be received at the appropriate address listed in the ADDRESSES section of this notice by the date specified in the DATES section of this notice. Authority: Sections 9(a) and 10 of Public L. 92–463 (5 U.S.C. App. 2, sections 9(a) and 10); 41 CFR Part 102–3; Sections 1114(f), 1804, and 1851(d) of the Social Security Act (42 U.S.C. 1314(f), 1395b–2, and 1394w– 21(d)); and Section 222 of the Public Health Service Act (42 U.S.C. 217a). Dated: December 3, 2007. Kerry Weems, Acting Administrator, Centers for Medicare & Medicaid Services. [FR Doc. E7–24273 Filed 12–27–07; 8:45 am] BILLING CODE 4120–01–P DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services [CMS–2269–N] RIN 0938–AO75 Medicaid Program; Fiscal Year Disproportionate Share Hospital Allotments and Disproportionate Share Hospital Institutions for Mental Disease Limits Centers for Medicare & Medicaid Services (CMS), HHS. ACTION: Notice. AGENCY: SUMMARY: This notice announces the final Federal share disproportionate share hospital (DSH) allotments for Federal fiscal year (FFY) 2006 and the preliminary Federal share DSH allotments for FFY 2008. This notice also announces the final FFY 2006 and the preliminary FFY 2008 limitations on aggregate DSH payments that States may make to institutions for mental disease and other mental health facilities. In addition, this notice includes background information describing the methodology for determining the amounts of States’ FFY DSH allotments. DATES: Effective Date: December 28, 2007. FOR FURTHER INFORMATION CONTACT: Richard Strauss, (410) 786–2019. SUPPLEMENTARY INFORMATION: I. Background A. Disproportionate Share Hospital Allotments for Federal Fiscal Year 2003 Under section 1923(f)(3) of the Social Security Act (the Act), States’ Federal E:\FR\FM\28DEN1.SGM 28DEN1 73832 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices C. DSH Allotments for Non-Low DSH States for FFY 2005, and Fiscal Years Thereafter Under the methodology contained in section 1923(f)(3)(C) of the Act, as amended by section 1001(a)(2) of the MMA, the non-Low-DSH States’ DSH allotments for FFY 2005 and subsequent fiscal years continue at the same level as the States’ DSH allotments for FFY 2004 until a ‘‘fiscal year specified’’ occurs. The ‘‘fiscal year specified’’ is the first fiscal year for which the Secretary estimates that a State’s DSH allotment equals (or no longer exceeds) the DSH allotment as would have been determined under the statute in effect before the enactment of the MMA. We determine whether the fiscal year specified has occurred under a special parallel process. Specifically, under this parallel process, a ‘‘parallel’’ DSH allotment is determined for FFYs after 2003 by increasing the State’s DSH allotment for the previous fiscal year by the percentage change in the CPI–U for the prior fiscal year, subject to the 12 percent limit. This is the methodology as would otherwise have been applied under section 1923(f)(3)(A) of the Act notwithstanding the application of the provisions of MMA. The ‘‘fiscal year specified,’’ is the fiscal year in which the parallel DSH allotment calculated under this special parallel process finally equals or exceeds the FY 2004 DSH allotment, as determined under the MMA provisions. Once the fiscal year specified occurs for a State, that State’s fiscal year DSH allotment will be calculated by increasing the State’s previous actual fiscal year DSH allotment (which would be equal to the FY 2004 DSH allotment) by the percentage change in the CPI–U for the previous fiscal year, subject to the 12 percent limit. The following example illustrates how the fiscal year DSH allotment would be calculated for fiscal years after FFY 2004. B. DSH Allotments for FFY 2004 mstockstill on PROD1PC66 with NOTICES fiscal year (FFY) 2003 disproportionate share hospital (DSH) allotments were calculated by increasing the amounts of the FFY 2002 allotments for each State (as specified in the chart, entitled ‘‘DSH Allotment (in millions of dollars),’’ contained in section 1923(f)(2) of the Act) by the percentage change in the Consumer Price Index for all Urban Consumers (CPI–U) for the prior fiscal year. The allotment, determined in this way, is subject to the limitation that an increase to a State’s DSH allotment for a fiscal year cannot result in the DSH allotment exceeding the greater of the State’s DSH allotment for the previous fiscal year or 12 percent of the State’s total medical assistance expenditures for the allotment year (this is referred to as the 12 percent limit). Most States’ actual FY 2002 allotments were determined in accordance with the provisions of section 1923(f)(4) of the Act. However, as indicated previously, the calculation of States’ FFY 2003 allotments was not based on the actual FFY 2002 DSH allotments; rather, section 1923(f)(3) of the Act requires that the States’ FY 2003 allotments be determined using the amount of the States’ FY 2002 allotments specified in the chart in section 1923(f)(2) of the Act. The exception to this is the calculation of the FFY 2003 DSH allotments for certain ‘‘Low–DSH States’’ (defined in section 1923(f)(5) of the Act). Under the Low– DSH State provision, there is a special calculation methodology for the Low– DSH States only. Under this methodology, the FFY 2003 allotments were determined by using (that is, increasing) States’ actual FFY 2002 DSH allotments (not their FFY 2002 allotments specified in the chart in section 1923(f)(2) of the Act) by the percentage change in the CPI–U for the previous fiscal year. Example —In this example, we are determining the parallel FFY 2008 DSH allotment. A State’s actual FFY 2003 DSH allotment is $100 million. Under the MMA, this State’s actual FFY 2004 DSH allotment would be $116 million ($100 million increased by 16 percent). The State’s DSH allotment for FFY 2005 and subsequent fiscal years would continue at the $116 million FFY 2004 DSH allotment for fiscal years following FFY 2004 until the ‘‘fiscal year specified’’ occurs. In the separate parallel process, we determine whether the fiscal year specified has occurred by calculating the State’s DSH allotments in accordance with the statute in effect before the enactment of the MMA. Under this special process, we would continue to determine the State’s parallel DSH allotment for each fiscal year by increasing the State’s parallel DSH allotment Section 1001(a) of the Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (MMA) (Pub. L. 108–173, enacted on December 8, 2003) amended section 1923(f)(3) of the Act to provide for a ‘‘Special, Temporary Increase In Allotments On A One-Time, Non-Cumulative Basis.’’ Under this provision, States’ FFY 2004 DSH allotments were determined by increasing their FFY 2003 allotments by 16 percent, and the fiscal year DSH allotment amounts so determined were not subject to the 12 percent limit. VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00076 Fmt 4703 Sfmt 4703 for the previous fiscal year (as also determined under the special parallel process) by the percentage change in the CPI– U for the previous fiscal year, and subject to the 12 percent limit. Assume for purposes of this example that, in accordance with this special parallel process, the State’s parallel FFY 2007 DSH allotment was determined to be $115 million and the percentage change in the CPI–U for FFY 2007 (the previous fiscal year) relevant for the calculation of the FFY 2008 DSH allotment was 2.3 percent. That is, the percentage change for the CPI–U for FFY 2007, the year before FFY 2008, was 2.3 percent. Therefore, the State’s special parallel process FFY 2008 DSH allotment amount would be calculated by increasing the special parallel process FFY 2007 DSH allotment amount of $115 million by 2.3 percent; this results in a special DSH allotment process amount for FFY 2008 of $117.6 million. Since $117.6 million is greater than $116 million (the actual FFY 2004 DSH allotment calculated under the MMA), we would determine that FFY 2008 is the ‘‘fiscal year specified’’ (the first year that the FFY 2004 allotment equals or no longer exceeds the parallel process allotment). We would then determine the State’s FFY 2008 allotment as the State’s actual FFY 2007 DSH allotment ($116 million) increased by the percentage change in the CPI–U for FFY 2007 (2.3 percent). Therefore, the State’s FFY 2008 DSH allotment would be $118.67 million ($116 million increased by 2.3 percent); for purposes of this example, the application of the 12 percent limit has no effect. Furthermore, for FFY 2009 and thereafter, the State’s DSH allotment would be calculated by increasing the State’s previous fiscal year’s DSH allotment by the percentage change in the CPI–U for the previous fiscal year, subject to the 12 percent limit. However, as amended by section 1001(b)(4) of the MMA, section 1923(f)(5)(B) of the Act also contains new criteria for determining whether a State is a Low-DSH State, beginning with FFY 2004. This provision is described in section I.D. Finally, the provisions of section 6054 of the Deficit Reduction Act (DRA) of 2005 Public Law 109–171, enacted February 8, 2006) affected the determination of the DSH allotment for the District of Columbia. Under section 6054 of the DRA, for purposes of determining only the FFY 2006 and subsequent fiscal year DSH allotments for the District of Columbia, the table in section 1923(f)(2) of the Act is amended by increasing the FFY DSH allotment amounts indicated in that table for the District of Columbia for FFYs 2000, 2001, and 2002 to $49 million for each of those fiscal years. Before the DRA amendment, the amount in the chart in section 1923(f)(2) of the Act for the District of Columbia for each of those fiscal years was $32 million. This DRA provision increases the fiscal year DSH allotment for the District of Columbia effective with the FFY 2006 DSH E:\FR\FM\28DEN1.SGM 28DEN1 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices mstockstill on PROD1PC66 with NOTICES allotment. This change is because the DSH allotments for FFY 2003 were based on the amounts of States’ DSH allotments for FFY 2002 as contained in the chart in section 1923(f)(2) of the Act. Since (for purposes of ultimately determining the FFY 2006 allotment) the DRA provision increased the FFY 2002 allotment for the District of Columbia, as indicated above, the FFY 2003 allotment was increased. Furthermore, for this purpose, the FFY 2004 allotment for the District of Columbia would then have been determined by increasing the FFY 2003 allotment (as so determined) by 16 percent. For fiscal years subsequent to FFY 2006, the DSH allotments are determined as described above. The final FFY 2006 DSH allotment and the preliminary FFY 2008 DSH allotment for the District of Columbia contained in this notice reflect the provision of section 6054 of the DRA. As described below, in accordance with section 6054 of the DRA, the final FFY 2006 DSH allotment for the District of Columbia is $57,692,600. As amended by section 6054 of the DRA, the FFY 2002 DSH allotment amount for the District of Columbia contained in the chart in section 1923(f)(2) of the Act was increased to $49,000,000. In accordance with section 1923(f)(3)(A) of the Act, the FFY 2003 DSH allotment is determined by increasing the $49,000,000 DSH Allotment for FFY 2002 (as referenced in section 1923(f)(2) of the Act) by the percentage change in the CPI–U for 2002 (in this case, 1.5 percent) to $49,735,000. In accordance with section 1923(f)(3)(C)(i) of the Act, the FFY 2004 DSH allotment is determined by increasing the $49,735,000 FFY 2003 DSH allotment amount by 16 percent to $57,692,600. In accordance with the provisions of section 1923(f)(3)(C) of the Act, the District of Columbia’s DSH allotments for FFYs 2005, 2006, and 2007 are also $57,692,600. Finally, in accordance with section 6054 of the DRA, the District of Columbia’s DSH allotment is increased as described above, effective beginning with FFY 2006. D. DSH Allotments for Low–DSH States for FFY 2004 and Fiscal Years Thereafter Section 1001(b)(1) of the MMA amended section 1923(f)(5) of the Act regarding the calculation of the fiscal year DSH allotments for ‘‘Low–DSH’’ States for FFY 2004 and subsequent fiscal years. Specifically, under section 1923(f)(5)(B) of the Act, as amended by section 1001(b)(4) of the MMA, a State is considered a Low–DSH State for FFY 2004 if its total DSH payments under its VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 State plan for FFY 2000 (including Federal and State shares) as reported to CMS as of August 31, 2003, are greater than 0 percent and less than 3 percent of the State’s total FFY 2000 expenditures under its State plan for medical assistance. For States that meet the new Low–DSH criteria, their FFY 2004 DSH allotments are calculated by increasing their FFY 2003 DSH allotments by 16 percent. Therefore, for FFY 2004, Low–DSH States’ fiscal year DSH allotments are calculated in the same way as the DSH allotments for regular States, which under section 1923(f)(3) of the Act, get the special temporary increase for FFY 2004. Furthermore, for States meeting the MMA’s Low-DSH definition, the DSH allotments for FFYs 2005 through 2008 will continue to be determined by increasing the previous fiscal year’s DSH allotment by 16 percent. The LowDSH States’ DSH allotments for FFYs 2004 through 2008 are not subject to the 12 percent limit. The Low-DSH States’ DSH allotments for FFYs 2009 and subsequent fiscal years are calculated by increasing those States’ DSH allotments for the prior fiscal year by the percentage change in the CPI–U for that prior fiscal year. For FFYs 2009 and thereafter, the DSH allotments so determined would be subject to the 12 percent limit. E. Institutions for Mental Diseases DSH Limits for FFYs 1998 and Thereafter Under section 1923(h) to the Act, Federal financial participation (FFP) is not available for DSH payments to institutions for mental diseases (IMDs) and other mental health facilities that are in excess of State-specific aggregate limits. Under this provision, this aggregate limit for DSH payments to IMDs and other mental health facilities is the lesser of a State’s FFY 1995 total computable (State and Federal share) IMD and other mental health facility DSH expenditures applicable to the State’s FFY 1995 DSH allotment (as reported on the Form CMS–64 as of January 1, 1997), or the amount equal to the product of the State’s current year total computable DSH allotment and the applicable percentage. Each State’s IMD limit on DSH payments to IMDs and other mental health facilities was calculated by first determining the State’s total computable DSH expenditures attributable to the FFY 1995 DSH allotment for mental health facilities and inpatient hospitals. This calculation was based on the total computable DSH expenditures reported by the State on the Form CMS–64 as mental health DSH and inpatient hospital as of January 1, 1997. We then PO 00000 Frm 00077 Fmt 4703 Sfmt 4703 73833 calculate an ‘‘applicable percentage.’’ The applicable percentage for FFY 1998 through FFY 2000 (1995 IMD DSH percentage) is calculated by dividing the total computable amount of IMD and mental health DSH expenditures applicable to the State’s FFY 1995 DSH allotment by the total computable amount of all DSH expenditures (mental health facility plus inpatient hospital) applicable to the FFY 1995 DSH allotment. For FFY 2001 and thereafter, the applicable percentage is defined as the lesser of the applicable percentage as calculated above (for FFYs 1998 through 2001) or 50 percent for FFY 2001; 40 percent for FFY 2002; and 33 percent for each subsequent FFY. The applicable percentage is then applied to each State’s total computable FFY DSH allotment for the current FFY. The State’s total computable FFY DSH allotment is calculated by dividing the State’s Federal share DSH allotment for the FFY by the State’s Federal medical assistance percentage (FMAP) for that FFY. In the final step of the calculation of the IMD DSH Limit, the State’s total computable IMD DSH limit for the FFY is set at the lesser of the product of a State’s current fiscal year total computable DSH allotment and the applicable percentage for that fiscal year, or the State’s FFY 1995 total computable IMD and other mental health facility DSH expenditures applicable to the State’s FFY 1995 DSH allotment as reported on the Form CMS–64. The MMA legislation did not amend the Medicaid statute with respect to the calculation of the IMD DSH limit. F. DSH Allotments and IMD DSH Limits Published in the Federal Register on October 3, 2006 On October 3, 2006, we published a notice (71 FR 58398) in the Federal Register that announced the final Federal share DSH allotments for Federal fiscal year (FFY) 2005, and the preliminary Federal share DSH allotments for FFY 2006 and FFY 2007. It also announced the final FFY 2005, and the preliminary FFY 2006 and FFY 2007, limitations on aggregate DSH payments that States may make to institutions for mental disease (IMDs) and other mental health facilities. G. Publication in the Federal Register of Preliminary and Final Notice for DSH Allotments and IMD DSH Limits In general, we initially determine States’ DSH allotments and IMD DSH limits for a fiscal year using estimates of medical assistance expenditures, including DSH expenditures in their E:\FR\FM\28DEN1.SGM 28DEN1 73834 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices Medicaid programs. These estimates are provided by States each year on the August quarterly Medicaid budget reports (Form CMS–37) before the Federal fiscal year for which the DSH allotments and IMD DSH limits are being determined. The DSH allotments and IMD DSH limits determined using these estimates are referred to as ‘‘preliminary.’’ Only after we receive States’’ reports of the actual related medical assistance expenditures through the quarterly expenditure report (Form CMS–64), which occurs after the end of the fiscal year, are the ‘‘final’’ DSH Allotments and IMD DSH limits determined. As indicated in section I.F. of this notice, the notice published in the Federal Register on October 3, 2006 announced the final FFY 2005 DSH allotments and the final FFY 2005 IMD DSH limits (since they were based on the actual expenditures related to those years), the preliminary FFYs 2006 and 2007 DSH allotments (based on estimates), and the preliminary FFYs 2006 and 2007 IMD DSH limits (since they were based on the preliminary DSH allotments for FFYs 2006 and 2007). This notice announces the final FFY 2006 DSH allotments and the final FFY 2006 IMD DSH limits (since these are now based on the actual expenditures for those fiscal years), the preliminary FFY 2008 DSH allotments (based on estimates), and the preliminary IMD DSH limits for FFY 2008 (since they are based on the preliminary DSH allotments for FFY 2008). This notice does not include the final FFY 2007 DSH allotments or the final FFY 2007 IMD DSH limits, since the associated actual expenditures for FFY 2007 are not available at this time. mstockstill on PROD1PC66 with NOTICES II. Provisions of the Notice A. Calculation of the Final FFY 2006 Federal Share State DSH Allotments the Preliminary FFY 2008 Federal Share State DSH Allotments Chart 1 of the Addendum to this notice provides the States’ ‘‘final’’ FFY 2006 DSH allotments. The final FFY 2006 DSH allotments for each State were computed in accordance with the provisions of the Medicaid statute as amended by the MMA. As required by the provisions of the MMA, the final FFY 2004 DSH allotments for the ‘‘LowDSH’’ States and all the other States were calculated by increasing the FFY 2003 DSH allotments by 16 percent. In the notice published on March 26, 2004 in the Federal Register, we explained the definition and determination of the ‘‘Low-DSH’’ States under the MMA provisions. However, for following VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 fiscal years, the DSH allotments are determined under a process which incorporates a parallel process described in section I.C. of this notice. Under that parallel process, States final FFY 2006 DSH allotments were determined using the States’ expenditure reports (Form CMS–64) for FFY 2006. Chart 2 of the Addendum to this notice provides the States’ ‘‘preliminary’’ FFY 2008 DSH allotments. These preliminary allotments were determined using the States’ August 2007 expenditure estimates submitted by the States on the Form CMS–37. We will publish the final FFY 2008 DSH allotments for each State following receipt of the States’ four quarterly Medicaid expenditure reports (Form CMS–64) for FFY 2008. B. Calculation of the FFYs 2006 and FFY 2008 IMD DSH Limits Section 1923(h) of the Act specifies the methodology to be used to establish the limits on the amount of DSH payments that a State can make to IMDs and other mental health facilities. FFP is not available for IMD or DSH payments that exceed the lesser of the State’s FFY 1995 total computable mental health DSH expenditures applicable to the State’s FFY 1995 DSH allotment as reported to us on the Form CMS–64 as of January 1, 1997; or the amount equal to the product of the State’s current FFY total computable DSH allotment and the applicable percentage. We are publishing the final FFY 2006 IMD DSH limit, and the preliminary FFY 2008 IMD DSH limit, along with an explanation of the calculation of these limits. For FFY 2003 and following fiscal years, the applicable percentage is the lesser of 33 percent or the 1995 DSH IMD percentage of the amount computed for FFY 2000. This percentage was applied to the State’s fiscal year total computable DSH allotment. This result was then compared to the State’s FFY 1995 total computable mental health DSH expenditures applicable to the State’s FFY 1995 DSH allotment as reported on the Form CMS–64 as of January 1, 1997. The lesser of these two amounts was the State’s limitation on total computable IMD/DSH expenditures for FFY 2003 and following fiscal years. Charts 3 and 4 of the Addendum to this notice detail each State’s final IMD/ DSH limitation for FFY 2006 and the preliminary IMD/DSH limitation for FFY 2008, respectively, in accordance with section 1923(h) of the Act. PO 00000 Frm 00078 Fmt 4703 Sfmt 4703 III. Collection of Information Requirements This document does not impose information collection and recordkeeping requirements. Consequently, it need not be reviewed by the Office of Management and Budget under the authority of the Paperwork Reduction Act of 1995 (44 U.S.C. 35). 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. 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 1 year). This notice does not reach the economic threshold and thus is not considered a major rule. The RFA requires agencies to analyze options for regulatory relief of small businesses. 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 $6.5 million to $31 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, and the Secretary certifies, that this notice will not have significant economic impact on a substantial number of small entities. Specifically the effects of the various controlling statutes on providers are not impacted by a result of any independent regulatory impact and not this notice. The purpose of the notice is to announce the latest distributions as required by the statute. 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 E:\FR\FM\28DEN1.SGM 28DEN1 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices 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 for Medicaid payment regulations and has fewer than 100 beds. We are not preparing analysis for section 1102(b) of the Act because we have determined and the Secretary certifies that this notice will not have a significant impact on the operations of a substantial number of small rural hospitals. In addition, the MMA set statutorily defined limits on the amount of Federal share DSH expenditures available for FFY 2004 and subsequent fiscal years. Specifically, section 1001 of the MMA increased the DSH allotment for States beginning with fiscal year 2004. While overall the statute mandated some increases in DSH payments, we do not believe that this notice will have a significant economic impact on a substantial number of small entities. 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 $140 million. This notice will have no consequential effect on State, local, or tribal governments or on the private sector. Executive Order 13132 establishes certain requirements that an agency must meet when it promulgates a proposed rule (and subsequent final 73835 rule) that imposes substantial direct requirement costs on State and local governments, preempts State law, or otherwise has Federalism implications. Since this notice does not impose any costs on State or local governments, the requirements of E.O. 13132 are not applicable. In accordance with the provisions of Executive Order 12866, this notice was reviewed by the Office of Management and Budget. Addendum This addendum contains the charts 1 through 4 (preceeded by associated keys) that are referred to in the preamble of this notice. KEY TO CHART 1.—FINAL DSH ALLOTMENTS FOR FY 2006 [Key to the Chart of the Final FFY 2005 DSH Allotments. The final FFY 2006 DSH Allotments for the regular States Are Presented in the Top Section of this chart and the final FFY 2005 DSH Allotments for the Low-DSH States Are presented in the Bottom Section of the chart.] Column Description For Non-Low-DSH States: Column A ................................. Column B ................................. Column C ................................. Column D ................................. For Low-DSH States: Column A ................................. Column B ................................. Column C ................................. Column D ................................. State. Final FY 2004 DSH Allotment Federal Share—This column contains the final FFY 2004 DSH Allotments. FY 2006 DSH Allotment Federal Share—This column contains the final FFY 2006 DSH Allotments. MMA Low-DSH Status—This column indicates the MMA Low-DSH Status of each State. State. Prior FY DSH Allotment—This column contains the final FFY 2005 DSH Allotments. FY 2006 DSH Allotments Federal Share—This column contains the final FFY 2006 DSH Allotments = Column B multiplied by 1.16. MMA Low-DSH Status—This column indicates the MMA Low-DSH Status of each State. KEY TO CHART 2.—PRELIMINARY DSH ALLOTMENTS FOR FY 2008 [Key to the Chart of the Preliminary FFY 2008 DSH Allotments. The preliminary FFY 2008 DSH Allotments for the regular States are presented in the top section of this chart and the preliminary FFY 2008 DSH Allotments for the Low-DSH States are presented in the bottom section of the chart.] Column Description For Non-Low-DSH States: Column A ................................. Column B ................................. Column C ................................. Column D ................................. For Low-DSH States: Column A ................................. Column B ................................. Column C ................................. Column D ................................. State. Final FY 2004 DSH Allotment Federal Share—This column contains the final FFY 2004 DSH Allotments. FY 2008 DSH Allotment Federal Share—This column contains the preliminary FFY 2008 DSH Allotments. MMA Low-DSH Status—This column indicates the MMA Low-DSH Status of each State. State. Prior FY DSH Allotment—This column contains the preliminary FFY 2007 DSH Allotments. FY 2008 DSH Allotments Federal Share—This column contains the preliminary FFY 2008 DSH Allotments = Column B multiplied by 1.16. MMA Low-DSH Status—This column indicates the MMA Low-DSH Status of each State. KEY TO CHART 3.—FINAL FFY 2006 IMD DSH LIMITS [Key to the Chart of the FFY 2006 IMD Limitations.—The final FFY 2006 IMD DSH Limits for the regular States are presented in the top section of this chart and the Final FFY IMD DSH Limits for the Low-DSH States are presented in the Bottom Section of the chart.] mstockstill on PROD1PC66 with NOTICES Column Description Column A ........................................ Column B ........................................ State. Inpatient Hospital Services FY 95 DSH Total Computable. This column contains the States’ total computable FFY 1995 inpatient hospital DSH expenditures as reported on the Form CMS–64. IMD and Mental Health Services FY 95 DSH Total Computable. This column contains the total computable FFY 1995 mental health facility DSH expenditures as reported on the Form CMS–64 as of January 1, 1997. Column C ........................................ VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00079 Fmt 4703 Sfmt 4703 E:\FR\FM\28DEN1.SGM 28DEN1 73836 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices KEY TO CHART 3.—FINAL FFY 2006 IMD DSH LIMITS—Continued [Key to the Chart of the FFY 2006 IMD Limitations.—The final FFY 2006 IMD DSH Limits for the regular States are presented in the top section of this chart and the Final FFY IMD DSH Limits for the Low-DSH States are presented in the Bottom Section of the chart.] Column Description Column D ........................................ Total Inpatient & IMD & Mental Health FY 95 DSH Total Computable, Col B + C. This column contains the total computation of all inpatient hospital DSH expenditures and mental health facility DSH expenditures for FFY 1995 as reported on the Form CMS–64 as of January 1, 1997 (representing the sum of Column B and Column C). Applicable Percentage Col C/D. This column contains the ‘‘applicable percentage’’ representing the total computable FFY 1995 mental health facility DSH expenditures divided by total computable all inpatient hospital and mental health facility DSH expenditures for FFY 1995 (the amount in Column C divided by the amount in Column D) Per section 1923(h)(2)(A)(ii)(II) of the Act, for FFYs after FY 2002, the applicable percentage can be no greater than 33 percent. FY 2006 Federal Share DSH Allotment. This column contains the States’ final FFY 2005 DSH allotments. FFY 2006 FMAP. FY 2006 DSH Allotments in TC. Col. F/G. This column contains FFY 2006 total computable DSH allotment (determined as Column F/Column G). Col E * Col H in TC. This column contains the applicable percent of FFY 2006 total computable DSH allotment (calculated as Column E × Column H). FY 2006 IMD DSH Limit Total Computable. Lesser of Col. C or I. The column contains the lesser of the lesser of Column I or C. FY 2006 IMD DSH Limit Federal Share, Col. G × J. This column contains the total computable IMD DSH Limit from Col. J and converts that amount into a Federal share (calculated as Col. G × Col. J). LOW DSH Status. This column contains Low DSH status for each State. Column E ........................................ Column F ........................................ Column G ........................................ Column H ........................................ Column I .......................................... Column J ......................................... Column K ........................................ Column L ......................................... KEY TO CHART 4.—PRELIMINARY FFY 2008 IMD DSH LIMITS [Key to the Chart of the FFY 2008 IMD Limitations.—The preliminary FFY 2008 IMD DSH Limits for the regular States are presented in the top section of this chart and the preliminary FFY 2008 IMD DSH Limits for the Low-DSH States are presented in the Bottom Section of the Chart Column Description Column A ........................................ Column B ........................................ State. Inpatient Hospital Services FY 95 DSH Total Computable. This column contains the States’ total computable FFY 1995 inpatient hospital DSH expenditures as reported on the Form CMS–64. IMD and Mental Health Services FY 95 DSH Total Computable. This column contains the total computable FFY 1995 mental health facility DSH expenditures as reported on the Form CMS–64 as of January 1, 1997. Total Inpatient & IMD & Mental Health FY 95 DSH Total Computable, Col. B + C. This column contains the total computation of all inpatient hospital DSH expenditures and mental health facility DSH expenditures for FFY 1995 as reported on the Form CMS–64 as of January 1, 1997 (representing the sum of Column B and Column C). Applicable Percentage Col. C/D. This column contains the ‘‘applicable percentage’’ representing the total computable FFY 1995 mental health facility DSH expenditures divided by total computable all inpatient hospital and mental health facility DSH expenditures for FFY 1995 (the amount in Column C divided by the amount in Column D) Per section 1923(h)(2)(A)(ii)(II) of the Act, for FFYs after FY 2002, the applicable percentage can be no greater than 33 percent. FY 2008 Federal Share DSH Allotment. This column contains the States’ preliminary FFY 2008 DSH allotments. FFY 2008 FMAP. FY 2008 DSH Allotment Total Computable Col. F/G. This column contains FFY 2008 total computable DSH allotment (determined as Column F/Column G). Col E * Col H in TC. This column contains the applicable percent of FFY 2008 total computable DSH allotment (calculated as Column E × Column H) FY 2008 IMD DSH Limit Total Computable. Lesser of Col. C or I. The column contains the lesser of the lesser of Column I or C. FY 2008 IMD DSH Limit Federal Share, Col. G × J. This column contains the total computable IMD DSH Limit from Col. J and converts that amount into a Federal share (calculated as Col. G × Col. J). Low DSH Status. This column contains Low DSH status for each State. Column C ........................................ Column D ........................................ Column E ........................................ Column F ........................................ Column G ........................................ Column H ........................................ Column I .......................................... Column J ......................................... Column K ........................................ mstockstill on PROD1PC66 with NOTICES Column L ......................................... VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00080 Fmt 4703 Sfmt 4703 E:\FR\FM\28DEN1.SGM 28DEN1 VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00081 Fmt 4703 Sfmt 4725 E:\FR\FM\28DEN1.SGM 28DEN1 73837 EN28DE07.000</GPH> mstockstill on PROD1PC66 with NOTICES Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices VerDate Aug<31>2005 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00082 Fmt 4703 Sfmt 4725 E:\FR\FM\28DEN1.SGM 28DEN1 EN28DE07.001</GPH> mstockstill on PROD1PC66 with NOTICES 73838 VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00083 Fmt 4703 Sfmt 4725 E:\FR\FM\28DEN1.SGM 28DEN1 73839 EN28DE07.002</GPH> mstockstill on PROD1PC66 with NOTICES Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices BILLING CODE 4120–01–P VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 PO 00000 Frm 00084 Fmt 4703 Sfmt 4703 E:\FR\FM\28DEN1.SGM 28DEN1 EN28DE07.003</GPH> mstockstill on PROD1PC66 with NOTICES 73840 Federal Register / Vol. 72, No. 248 / Friday, December 28, 2007 / Notices Authority: Section 1923(a)(2), (f), and (h) of the Social Security Act (42 U.S.C. 1396r4(a)(2), (f), and (h), and Pub. L. 105–33) (Catalog of Federal Domestic Assistance Program No. 93.778, Medical Assistance Program) Dated: October 23, 3007. Kerry Weems, Acting Administrator, Centers for Medicare & Medicaid Services. Dated: November 8, 2007. Michael O. Leavitt, Secretary. [FR Doc. E7–24486 Filed 12–27–07; 8:45 am] BILLING CODE 4120–01–C DEPARTMENT OF HEALTH AND HUMAN SERVICES Centers for Medicare & Medicaid Services [CMS–1556–N] Medicare Program; Notice of Supplemental Election Period for Participation in the Calendar Year (CY) 2008 Competitive Acquisition Program for Part B Drugs Centers for Medicare & Medicaid Services (CMS), HHS. ACTION: Notice. AGENCY: mstockstill on PROD1PC66 with NOTICES SUMMARY: This notice announces an additional physician election period for physicians who are not currently participating in the competitive acquisition program (CAP) for Medicare Part B drugs for calendar year (CY) 2008. The additional physician election period begins on January 15, 2008 and ends on February 15, 2008. Physicians who elect to join the CAP during this additional election period will enter into a physician election agreement effective April 1, 2008 through December 31, 2008. DATES: The additional CAP physician election period will begin on January 15, 2008 and end on February 15, 2008. Physicians electing to join the CAP during this period will participate in the CAP effective April 1, 2008 through December 31, 2008. FOR FURTHER INFORMATION CONTACT: Edmund Kasaitis (410) 786–0477. SUPPLEMENTARY INFORMATION: I. Background The Medicare Prescription Drug, Improvement, and Modernization Act of 2003 (Pub. L. 108–173) (MMA) requires the implementation of a competitive acquisition program (CAP) for certain Medicare Part B drugs not paid on a cost or prospective payment system basis. Physicians who elect to participate in VerDate Aug<31>2005 22:27 Dec 27, 2007 Jkt 214001 the CAP obtain certain Part B covered drugs from vendors selected through a competitive bidding process. Physicians who do not elect to participate in the CAP purchase these drugs themselves and are paid under the average sales price (ASP) system. (For more information on the CAP, see the March 4, 2005 proposed rule (70 FR 10746), interim final rule with comment period (70 FR 39022), November 21, 2005 final rule (70 FR 70116), and the November 27, 2007 final rule with comment period (72 FR 66222)). In accordance with section 1874B(a) of the Social Security Act (the Act), statute and our regulations, the annual CAP physician election period for CY 2009 will occur in the fall of 2008. II. Provisions of the Notice Under the authority described in section 1847B(a)(5)(A)(i) of the Act and § 414.908(a)(2) of our regulations, which allows for physician election at times other than the regular, annual election period in such exigent circumstances as defined by CMS, we are designating an additional election period for physicians who wish to join the CAP for 2008. We are providing for this additional election period in recognition of the statutory changes we recently made to § 414.908(a)(2)(v) of our regulations. These changes were described and published in the November 27, 2007 final rule with comment period (72 FR 66265) with comment period. The changes will become effective on January 1, 2008. In the November 27, 2007 Federal Register (72 FR 66256), we published a final rule, that defined a new exigent circumstance that would allow a participating CAP physician to opt out of the CAP due to the burden that the CAP places on the physician’s practice. We established a two-tiered process, under which a physician may opt out of the CAP up to and including the first 60 days after the effective date of his or her CAP election agreement if continuing participation will impose a burden on the physician’s practice. A participating CAP physician may also opt out of CAP participation more than 60 days after the effective date of his or her CAP election agreement based on a change of circumstances which creates a new burden to the practice. The two-tiered process was developed in response to public comments to the CY 2008 Physician Fee Schedule proposed rule. However, the CY 2008 Physician Fee Schedule final rule was not issued until the end of the CY 2008 CAP physician election period, and therefore, we were not able to disseminate sufficient information to PO 00000 Frm 00085 Fmt 4703 Sfmt 4703 73841 make the large number of Medicare physicians aware of this new and desirable program change before the election period closed. Thus, we believe this is an ‘‘exigent circumstance’’ for which we should allow physicians an additional opportunity to join the CAP for CY 2008. The additional election period— • Takes place from January 15, 2008 until February 15, 2008. • Is open to physicians as defined in section 1861(r) of the Act (The term ‘‘physician’’ includes persons who are authorized to provide services under the Act and who can, within their State’s scope of practice, prescribe and order drugs covered under Medicare Part B. • Does not affect the terms of CAP participation for physicians who have already elected to participate in the CAP for 2008. • Uses the same procedures, forms, etc. as the regular, annual 2008 election period. Physicians who elect to participate in the CAP during the additional CY 2008 election period will have their CAP election agreement effective from April 1, 2008 through December 31, 2008. We note that participation in the CAP for CY 2009 requires renewal of CAP election during the regular fall election period, which will run from October 1, 2008 to November 15, 2008. Completed and signed forms must be returned by mail to the physician’s local carrier (the carrier that processes the physician’s Part B claims). Forms must be postmarked no later than February 15, 2008. Additional details about CAP physician election will be available on the CMS Web site at https:// www.cms.hhs.gov/ CompetitiveAcquisforBios/ 02_infophys.asp#TopOfPage. Authority: Section 1847B(a)(5)(A)(i) of the Social Security Act (42 U.S.C 1395w– 3b(a)(5)(A)(i).) (Catalog of Federal Domestic Assistance Program No. 93.774, MedicareSupplementary Medical Insurance Program) Dated: December 18, 2007. Kerry Weems, Acting Administrator, Centers for Medicare & Medicaid Services. [FR Doc. E7–25037 Filed 12–27–07; 8:45 am] BILLING CODE 4120–01–P E:\FR\FM\28DEN1.SGM 28DEN1

Agencies

[Federal Register Volume 72, Number 248 (Friday, December 28, 2007)]
[Notices]
[Pages 73831-73841]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E7-24486]


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DEPARTMENT OF HEALTH AND HUMAN SERVICES

Centers for Medicare & Medicaid Services

[CMS-2269-N]
RIN 0938-AO75


Medicaid Program; Fiscal Year Disproportionate Share Hospital 
Allotments and Disproportionate Share Hospital Institutions for Mental 
Disease Limits

AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.

ACTION: Notice.

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SUMMARY: This notice announces the final Federal share disproportionate 
share hospital (DSH) allotments for Federal fiscal year (FFY) 2006 and 
the preliminary Federal share DSH allotments for FFY 2008. This notice 
also announces the final FFY 2006 and the preliminary FFY 2008 
limitations on aggregate DSH payments that States may make to 
institutions for mental disease and other mental health facilities. In 
addition, this notice includes background information describing the 
methodology for determining the amounts of States' FFY DSH allotments.

DATES: Effective Date: December 28, 2007.

FOR FURTHER INFORMATION CONTACT: Richard Strauss, (410) 786-2019.

SUPPLEMENTARY INFORMATION:

I. Background

A. Disproportionate Share Hospital Allotments for Federal Fiscal Year 
2003

    Under section 1923(f)(3) of the Social Security Act (the Act), 
States' Federal

[[Page 73832]]

fiscal year (FFY) 2003 disproportionate share hospital (DSH) allotments 
were calculated by increasing the amounts of the FFY 2002 allotments 
for each State (as specified in the chart, entitled ``DSH Allotment (in 
millions of dollars),'' contained in section 1923(f)(2) of the Act) by 
the percentage change in the Consumer Price Index for all Urban 
Consumers (CPI-U) for the prior fiscal year. The allotment, determined 
in this way, is subject to the limitation that an increase to a State's 
DSH allotment for a fiscal year cannot result in the DSH allotment 
exceeding the greater of the State's DSH allotment for the previous 
fiscal year or 12 percent of the State's total medical assistance 
expenditures for the allotment year (this is referred to as the 12 
percent limit).
    Most States' actual FY 2002 allotments were determined in 
accordance with the provisions of section 1923(f)(4) of the Act. 
However, as indicated previously, the calculation of States' FFY 2003 
allotments was not based on the actual FFY 2002 DSH allotments; rather, 
section 1923(f)(3) of the Act requires that the States' FY 2003 
allotments be determined using the amount of the States' FY 2002 
allotments specified in the chart in section 1923(f)(2) of the Act. The 
exception to this is the calculation of the FFY 2003 DSH allotments for 
certain ``Low-DSH States'' (defined in section 1923(f)(5) of the Act). 
Under the Low-DSH State provision, there is a special calculation 
methodology for the Low-DSH States only. Under this methodology, the 
FFY 2003 allotments were determined by using (that is, increasing) 
States' actual FFY 2002 DSH allotments (not their FFY 2002 allotments 
specified in the chart in section 1923(f)(2) of the Act) by the 
percentage change in the CPI-U for the previous fiscal year.

B. DSH Allotments for FFY 2004

    Section 1001(a) of the Medicare Prescription Drug, Improvement, and 
Modernization Act of 2003 (MMA) (Pub. L. 108-173, enacted on December 
8, 2003) amended section 1923(f)(3) of the Act to provide for a 
``Special, Temporary Increase In Allotments On A One-Time, Non-
Cumulative Basis.'' Under this provision, States' FFY 2004 DSH 
allotments were determined by increasing their FFY 2003 allotments by 
16 percent, and the fiscal year DSH allotment amounts so determined 
were not subject to the 12 percent limit.

C. DSH Allotments for Non-Low DSH States for FFY 2005, and Fiscal Years 
Thereafter

    Under the methodology contained in section 1923(f)(3)(C) of the 
Act, as amended by section 1001(a)(2) of the MMA, the non-Low-DSH 
States' DSH allotments for FFY 2005 and subsequent fiscal years 
continue at the same level as the States' DSH allotments for FFY 2004 
until a ``fiscal year specified'' occurs. The ``fiscal year specified'' 
is the first fiscal year for which the Secretary estimates that a 
State's DSH allotment equals (or no longer exceeds) the DSH allotment 
as would have been determined under the statute in effect before the 
enactment of the MMA. We determine whether the fiscal year specified 
has occurred under a special parallel process. Specifically, under this 
parallel process, a ``parallel'' DSH allotment is determined for FFYs 
after 2003 by increasing the State's DSH allotment for the previous 
fiscal year by the percentage change in the CPI-U for the prior fiscal 
year, subject to the 12 percent limit. This is the methodology as would 
otherwise have been applied under section 1923(f)(3)(A) of the Act 
notwithstanding the application of the provisions of MMA. The ``fiscal 
year specified,'' is the fiscal year in which the parallel DSH 
allotment calculated under this special parallel process finally equals 
or exceeds the FY 2004 DSH allotment, as determined under the MMA 
provisions. Once the fiscal year specified occurs for a State, that 
State's fiscal year DSH allotment will be calculated by increasing the 
State's previous actual fiscal year DSH allotment (which would be equal 
to the FY 2004 DSH allotment) by the percentage change in the CPI-U for 
the previous fiscal year, subject to the 12 percent limit. The 
following example illustrates how the fiscal year DSH allotment would 
be calculated for fiscal years after FFY 2004.

    Example --In this example, we are determining the parallel FFY 
2008 DSH allotment. A State's actual FFY 2003 DSH allotment is $100 
million. Under the MMA, this State's actual FFY 2004 DSH allotment 
would be $116 million ($100 million increased by 16 percent). The 
State's DSH allotment for FFY 2005 and subsequent fiscal years would 
continue at the $116 million FFY 2004 DSH allotment for fiscal years 
following FFY 2004 until the ``fiscal year specified'' occurs. In 
the separate parallel process, we determine whether the fiscal year 
specified has occurred by calculating the State's DSH allotments in 
accordance with the statute in effect before the enactment of the 
MMA. Under this special process, we would continue to determine the 
State's parallel DSH allotment for each fiscal year by increasing 
the State's parallel DSH allotment for the previous fiscal year (as 
also determined under the special parallel process) by the 
percentage change in the CPI-U for the previous fiscal year, and 
subject to the 12 percent limit. Assume for purposes of this example 
that, in accordance with this special parallel process, the State's 
parallel FFY 2007 DSH allotment was determined to be $115 million 
and the percentage change in the CPI-U for FFY 2007 (the previous 
fiscal year) relevant for the calculation of the FFY 2008 DSH 
allotment was 2.3 percent. That is, the percentage change for the 
CPI-U for FFY 2007, the year before FFY 2008, was 2.3 percent. 
Therefore, the State's special parallel process FFY 2008 DSH 
allotment amount would be calculated by increasing the special 
parallel process FFY 2007 DSH allotment amount of $115 million by 
2.3 percent; this results in a special DSH allotment process amount 
for FFY 2008 of $117.6 million. Since $117.6 million is greater than 
$116 million (the actual FFY 2004 DSH allotment calculated under the 
MMA), we would determine that FFY 2008 is the ``fiscal year 
specified'' (the first year that the FFY 2004 allotment equals or no 
longer exceeds the parallel process allotment). We would then 
determine the State's FFY 2008 allotment as the State's actual FFY 
2007 DSH allotment ($116 million) increased by the percentage change 
in the CPI-U for FFY 2007 (2.3 percent). Therefore, the State's FFY 
2008 DSH allotment would be $118.67 million ($116 million increased 
by 2.3 percent); for purposes of this example, the application of 
the 12 percent limit has no effect. Furthermore, for FFY 2009 and 
thereafter, the State's DSH allotment would be calculated by 
increasing the State's previous fiscal year's DSH allotment by the 
percentage change in the CPI-U for the previous fiscal year, subject 
to the 12 percent limit.

    However, as amended by section 1001(b)(4) of the MMA, section 
1923(f)(5)(B) of the Act also contains new criteria for determining 
whether a State is a Low-DSH State, beginning with FFY 2004. This 
provision is described in section I.D.
    Finally, the provisions of section 6054 of the Deficit Reduction 
Act (DRA) of 2005 Public Law 109-171, enacted February 8, 2006) 
affected the determination of the DSH allotment for the District of 
Columbia. Under section 6054 of the DRA, for purposes of determining 
only the FFY 2006 and subsequent fiscal year DSH allotments for the 
District of Columbia, the table in section 1923(f)(2) of the Act is 
amended by increasing the FFY DSH allotment amounts indicated in that 
table for the District of Columbia for FFYs 2000, 2001, and 2002 to $49 
million for each of those fiscal years. Before the DRA amendment, the 
amount in the chart in section 1923(f)(2) of the Act for the District 
of Columbia for each of those fiscal years was $32 million. This DRA 
provision increases the fiscal year DSH allotment for the District of 
Columbia effective with the FFY 2006 DSH

[[Page 73833]]

allotment. This change is because the DSH allotments for FFY 2003 were 
based on the amounts of States' DSH allotments for FFY 2002 as 
contained in the chart in section 1923(f)(2) of the Act. Since (for 
purposes of ultimately determining the FFY 2006 allotment) the DRA 
provision increased the FFY 2002 allotment for the District of 
Columbia, as indicated above, the FFY 2003 allotment was increased. 
Furthermore, for this purpose, the FFY 2004 allotment for the District 
of Columbia would then have been determined by increasing the FFY 2003 
allotment (as so determined) by 16 percent. For fiscal years subsequent 
to FFY 2006, the DSH allotments are determined as described above. The 
final FFY 2006 DSH allotment and the preliminary FFY 2008 DSH allotment 
for the District of Columbia contained in this notice reflect the 
provision of section 6054 of the DRA.
    As described below, in accordance with section 6054 of the DRA, the 
final FFY 2006 DSH allotment for the District of Columbia is 
$57,692,600. As amended by section 6054 of the DRA, the FFY 2002 DSH 
allotment amount for the District of Columbia contained in the chart in 
section 1923(f)(2) of the Act was increased to $49,000,000. In 
accordance with section 1923(f)(3)(A) of the Act, the FFY 2003 DSH 
allotment is determined by increasing the $49,000,000 DSH Allotment for 
FFY 2002 (as referenced in section 1923(f)(2) of the Act) by the 
percentage change in the CPI-U for 2002 (in this case, 1.5 percent) to 
$49,735,000. In accordance with section 1923(f)(3)(C)(i) of the Act, 
the FFY 2004 DSH allotment is determined by increasing the $49,735,000 
FFY 2003 DSH allotment amount by 16 percent to $57,692,600. In 
accordance with the provisions of section 1923(f)(3)(C) of the Act, the 
District of Columbia's DSH allotments for FFYs 2005, 2006, and 2007 are 
also $57,692,600. Finally, in accordance with section 6054 of the DRA, 
the District of Columbia's DSH allotment is increased as described 
above, effective beginning with FFY 2006.

D. DSH Allotments for Low-DSH States for FFY 2004 and Fiscal Years 
Thereafter

    Section 1001(b)(1) of the MMA amended section 1923(f)(5) of the Act 
regarding the calculation of the fiscal year DSH allotments for ``Low-
DSH'' States for FFY 2004 and subsequent fiscal years. Specifically, 
under section 1923(f)(5)(B) of the Act, as amended by section 
1001(b)(4) of the MMA, a State is considered a Low-DSH State for FFY 
2004 if its total DSH payments under its State plan for FFY 2000 
(including Federal and State shares) as reported to CMS as of August 
31, 2003, are greater than 0 percent and less than 3 percent of the 
State's total FFY 2000 expenditures under its State plan for medical 
assistance. For States that meet the new Low-DSH criteria, their FFY 
2004 DSH allotments are calculated by increasing their FFY 2003 DSH 
allotments by 16 percent. Therefore, for FFY 2004, Low-DSH States' 
fiscal year DSH allotments are calculated in the same way as the DSH 
allotments for regular States, which under section 1923(f)(3) of the 
Act, get the special temporary increase for FFY 2004.
    Furthermore, for States meeting the MMA's Low-DSH definition, the 
DSH allotments for FFYs 2005 through 2008 will continue to be 
determined by increasing the previous fiscal year's DSH allotment by 16 
percent. The Low-DSH States' DSH allotments for FFYs 2004 through 2008 
are not subject to the 12 percent limit. The Low-DSH States' DSH 
allotments for FFYs 2009 and subsequent fiscal years are calculated by 
increasing those States' DSH allotments for the prior fiscal year by 
the percentage change in the CPI-U for that prior fiscal year. For FFYs 
2009 and thereafter, the DSH allotments so determined would be subject 
to the 12 percent limit.

E. Institutions for Mental Diseases DSH Limits for FFYs 1998 and 
Thereafter

    Under section 1923(h) to the Act, Federal financial participation 
(FFP) is not available for DSH payments to institutions for mental 
diseases (IMDs) and other mental health facilities that are in excess 
of State-specific aggregate limits. Under this provision, this 
aggregate limit for DSH payments to IMDs and other mental health 
facilities is the lesser of a State's FFY 1995 total computable (State 
and Federal share) IMD and other mental health facility DSH 
expenditures applicable to the State's FFY 1995 DSH allotment (as 
reported on the Form CMS-64 as of January 1, 1997), or the amount equal 
to the product of the State's current year total computable DSH 
allotment and the applicable percentage.
    Each State's IMD limit on DSH payments to IMDs and other mental 
health facilities was calculated by first determining the State's total 
computable DSH expenditures attributable to the FFY 1995 DSH allotment 
for mental health facilities and inpatient hospitals. This calculation 
was based on the total computable DSH expenditures reported by the 
State on the Form CMS-64 as mental health DSH and inpatient hospital as 
of January 1, 1997. We then calculate an ``applicable percentage.'' The 
applicable percentage for FFY 1998 through FFY 2000 (1995 IMD DSH 
percentage) is calculated by dividing the total computable amount of 
IMD and mental health DSH expenditures applicable to the State's FFY 
1995 DSH allotment by the total computable amount of all DSH 
expenditures (mental health facility plus inpatient hospital) 
applicable to the FFY 1995 DSH allotment. For FFY 2001 and thereafter, 
the applicable percentage is defined as the lesser of the applicable 
percentage as calculated above (for FFYs 1998 through 2001) or 50 
percent for FFY 2001; 40 percent for FFY 2002; and 33 percent for each 
subsequent FFY.
    The applicable percentage is then applied to each State's total 
computable FFY DSH allotment for the current FFY. The State's total 
computable FFY DSH allotment is calculated by dividing the State's 
Federal share DSH allotment for the FFY by the State's Federal medical 
assistance percentage (FMAP) for that FFY.
    In the final step of the calculation of the IMD DSH Limit, the 
State's total computable IMD DSH limit for the FFY is set at the lesser 
of the product of a State's current fiscal year total computable DSH 
allotment and the applicable percentage for that fiscal year, or the 
State's FFY 1995 total computable IMD and other mental health facility 
DSH expenditures applicable to the State's FFY 1995 DSH allotment as 
reported on the Form CMS-64.
    The MMA legislation did not amend the Medicaid statute with respect 
to the calculation of the IMD DSH limit.

F. DSH Allotments and IMD DSH Limits Published in the Federal Register 
on October 3, 2006

    On October 3, 2006, we published a notice (71 FR 58398) in the 
Federal Register that announced the final Federal share DSH allotments 
for Federal fiscal year (FFY) 2005, and the preliminary Federal share 
DSH allotments for FFY 2006 and FFY 2007. It also announced the final 
FFY 2005, and the preliminary FFY 2006 and FFY 2007, limitations on 
aggregate DSH payments that States may make to institutions for mental 
disease (IMDs) and other mental health facilities.

G. Publication in the Federal Register of Preliminary and Final Notice 
for DSH Allotments and IMD DSH Limits

    In general, we initially determine States' DSH allotments and IMD 
DSH limits for a fiscal year using estimates of medical assistance 
expenditures, including DSH expenditures in their

[[Page 73834]]

Medicaid programs. These estimates are provided by States each year on 
the August quarterly Medicaid budget reports (Form CMS-37) before the 
Federal fiscal year for which the DSH allotments and IMD DSH limits are 
being determined. The DSH allotments and IMD DSH limits determined 
using these estimates are referred to as ``preliminary.'' Only after we 
receive States'' reports of the actual related medical assistance 
expenditures through the quarterly expenditure report (Form CMS-64), 
which occurs after the end of the fiscal year, are the ``final'' DSH 
Allotments and IMD DSH limits determined.
    As indicated in section I.F. of this notice, the notice published 
in the Federal Register on October 3, 2006 announced the final FFY 2005 
DSH allotments and the final FFY 2005 IMD DSH limits (since they were 
based on the actual expenditures related to those years), the 
preliminary FFYs 2006 and 2007 DSH allotments (based on estimates), and 
the preliminary FFYs 2006 and 2007 IMD DSH limits (since they were 
based on the preliminary DSH allotments for FFYs 2006 and 2007).
    This notice announces the final FFY 2006 DSH allotments and the 
final FFY 2006 IMD DSH limits (since these are now based on the actual 
expenditures for those fiscal years), the preliminary FFY 2008 DSH 
allotments (based on estimates), and the preliminary IMD DSH limits for 
FFY 2008 (since they are based on the preliminary DSH allotments for 
FFY 2008). This notice does not include the final FFY 2007 DSH 
allotments or the final FFY 2007 IMD DSH limits, since the associated 
actual expenditures for FFY 2007 are not available at this time.

II. Provisions of the Notice

A. Calculation of the Final FFY 2006 Federal Share State DSH Allotments 
the Preliminary FFY 2008 Federal Share State DSH Allotments

    Chart 1 of the Addendum to this notice provides the States' 
``final'' FFY 2006 DSH allotments. The final FFY 2006 DSH allotments 
for each State were computed in accordance with the provisions of the 
Medicaid statute as amended by the MMA. As required by the provisions 
of the MMA, the final FFY 2004 DSH allotments for the ``Low-DSH'' 
States and all the other States were calculated by increasing the FFY 
2003 DSH allotments by 16 percent. In the notice published on March 26, 
2004 in the Federal Register, we explained the definition and 
determination of the ``Low-DSH'' States under the MMA provisions. 
However, for following fiscal years, the DSH allotments are determined 
under a process which incorporates a parallel process described in 
section I.C. of this notice. Under that parallel process, States final 
FFY 2006 DSH allotments were determined using the States' expenditure 
reports (Form CMS-64) for FFY 2006.
    Chart 2 of the Addendum to this notice provides the States' 
``preliminary'' FFY 2008 DSH allotments. These preliminary allotments 
were determined using the States' August 2007 expenditure estimates 
submitted by the States on the Form CMS-37. We will publish the final 
FFY 2008 DSH allotments for each State following receipt of the States' 
four quarterly Medicaid expenditure reports (Form CMS-64) for FFY 2008.

B. Calculation of the FFYs 2006 and FFY 2008 IMD DSH Limits

    Section 1923(h) of the Act specifies the methodology to be used to 
establish the limits on the amount of DSH payments that a State can 
make to IMDs and other mental health facilities. FFP is not available 
for IMD or DSH payments that exceed the lesser of the State's FFY 1995 
total computable mental health DSH expenditures applicable to the 
State's FFY 1995 DSH allotment as reported to us on the Form CMS-64 as 
of January 1, 1997; or the amount equal to the product of the State's 
current FFY total computable DSH allotment and the applicable 
percentage. We are publishing the final FFY 2006 IMD DSH limit, and the 
preliminary FFY 2008 IMD DSH limit, along with an explanation of the 
calculation of these limits.
    For FFY 2003 and following fiscal years, the applicable percentage 
is the lesser of 33 percent or the 1995 DSH IMD percentage of the 
amount computed for FFY 2000. This percentage was applied to the 
State's fiscal year total computable DSH allotment. This result was 
then compared to the State's FFY 1995 total computable mental health 
DSH expenditures applicable to the State's FFY 1995 DSH allotment as 
reported on the Form CMS-64 as of January 1, 1997. The lesser of these 
two amounts was the State's limitation on total computable IMD/DSH 
expenditures for FFY 2003 and following fiscal years.
    Charts 3 and 4 of the Addendum to this notice detail each State's 
final IMD/DSH limitation for FFY 2006 and the preliminary IMD/DSH 
limitation for FFY 2008, respectively, in accordance with section 
1923(h) of the Act.

III. Collection of Information Requirements

    This document does not impose information collection and 
recordkeeping requirements. Consequently, it need not be reviewed by 
the Office of Management and Budget under the authority of the 
Paperwork Reduction Act of 1995 (44 U.S.C. 35).

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.
    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 1 year). This notice 
does not reach the economic threshold and thus is not considered a 
major rule.
    The RFA requires agencies to analyze options for regulatory relief 
of small businesses. 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 
$6.5 million to $31 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, and the Secretary 
certifies, that this notice will not have significant economic impact 
on a substantial number of small entities. Specifically the effects of 
the various controlling statutes on providers are not impacted by a 
result of any independent regulatory impact and not this notice. The 
purpose of the notice is to announce the latest distributions as 
required by the statute.
    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

[[Page 73835]]

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 for Medicaid payment regulations and has fewer than 
100 beds. We are not preparing analysis for section 1102(b) of the Act 
because we have determined and the Secretary certifies that this notice 
will not have a significant impact on the operations of a substantial 
number of small rural hospitals.
    In addition, the MMA set statutorily defined limits on the amount 
of Federal share DSH expenditures available for FFY 2004 and subsequent 
fiscal years. Specifically, section 1001 of the MMA increased the DSH 
allotment for States beginning with fiscal year 2004. While overall the 
statute mandated some increases in DSH payments, we do not believe that 
this notice will have a significant economic impact on a substantial 
number of small entities.
    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 $140 million. This notice will have no 
consequential effect on State, local, or tribal governments or on the 
private sector.
    Executive Order 13132 establishes certain requirements that an 
agency must meet when it promulgates 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. Since this notice does not impose any costs on State or 
local governments, the requirements of E.O. 13132 are not applicable.
    In accordance with the provisions of Executive Order 12866, this 
notice was reviewed by the Office of Management and Budget.

Addendum

    This addendum contains the charts 1 through 4 (preceeded by 
associated keys) that are referred to in the preamble of this notice.

            Key to Chart 1.--Final DSH Allotments for FY 2006
  [Key to the Chart of the Final FFY 2005 DSH Allotments. The final FFY
   2006 DSH Allotments for the regular States Are Presented in the Top
Section of this chart and the final FFY 2005 DSH Allotments for the Low-
      DSH States Are presented in the Bottom Section of the chart.]
------------------------------------------------------------------------
              Column                             Description
------------------------------------------------------------------------
For Non-Low-DSH States:
    Column A......................  State.
    Column B......................  Final FY 2004 DSH Allotment Federal
                                     Share--This column contains the
                                     final FFY 2004 DSH Allotments.
    Column C......................  FY 2006 DSH Allotment Federal Share--
                                     This column contains the final FFY
                                     2006 DSH Allotments.
    Column D......................  MMA Low-DSH Status--This column
                                     indicates the MMA Low-DSH Status of
                                     each State.
For Low-DSH States:
    Column A......................  State.
    Column B......................  Prior FY DSH Allotment--This column
                                     contains the final FFY 2005 DSH
                                     Allotments.
    Column C......................  FY 2006 DSH Allotments Federal
                                     Share--This column contains the
                                     final FFY 2006 DSH Allotments =
                                     Column B multiplied by 1.16.
    Column D......................  MMA Low-DSH Status--This column
                                     indicates the MMA Low-DSH Status of
                                     each State.
------------------------------------------------------------------------


         Key to Chart 2.--Preliminary DSH Allotments for FY 2008
    [Key to the Chart of the Preliminary FFY 2008 DSH Allotments. The
preliminary FFY 2008 DSH Allotments for the regular States are presented
    in the top section of this chart and the preliminary FFY 2008 DSH
Allotments for the Low-DSH States are presented in the bottom section of
                               the chart.]
------------------------------------------------------------------------
              Column                             Description
------------------------------------------------------------------------
For Non-Low-DSH States:
    Column A......................  State.
    Column B......................  Final FY 2004 DSH Allotment Federal
                                     Share--This column contains the
                                     final FFY 2004 DSH Allotments.
    Column C......................  FY 2008 DSH Allotment Federal Share--
                                     This column contains the
                                     preliminary FFY 2008 DSH
                                     Allotments.
    Column D......................  MMA Low-DSH Status--This column
                                     indicates the MMA Low-DSH Status of
                                     each State.
For Low-DSH States:
    Column A......................  State.
    Column B......................  Prior FY DSH Allotment--This column
                                     contains the preliminary FFY 2007
                                     DSH Allotments.
    Column C......................  FY 2008 DSH Allotments Federal
                                     Share--This column contains the
                                     preliminary FFY 2008 DSH Allotments
                                     = Column B multiplied by 1.16.
    Column D......................  MMA Low-DSH Status--This column
                                     indicates the MMA Low-DSH Status of
                                     each State.
------------------------------------------------------------------------


             Key to Chart 3.--Final FFY 2006 IMD DSH Limits
 [Key to the Chart of the FFY 2006 IMD Limitations.--The final FFY 2006
 IMD DSH Limits for the regular States are presented in the top section
  of this chart and the Final FFY IMD DSH Limits for the Low-DSH States
           are presented in the Bottom Section of the chart.]
------------------------------------------------------------------------
              Column                             Description
------------------------------------------------------------------------
Column A..........................  State.
Column B..........................  Inpatient Hospital Services FY 95
                                     DSH Total Computable. This column
                                     contains the States' total
                                     computable FFY 1995 inpatient
                                     hospital DSH expenditures as
                                     reported on the Form CMS-64.
Column C..........................  IMD and Mental Health Services FY 95
                                     DSH Total Computable. This column
                                     contains the total computable FFY
                                     1995 mental health facility DSH
                                     expenditures as reported on the
                                     Form CMS-64 as of January 1, 1997.

[[Page 73836]]

 
Column D..........................  Total Inpatient & IMD & Mental
                                     Health FY 95 DSH Total Computable,
                                     Col B + C. This column contains the
                                     total computation of all inpatient
                                     hospital DSH expenditures and
                                     mental health facility DSH
                                     expenditures for FFY 1995 as
                                     reported on the Form CMS-64 as of
                                     January 1, 1997 (representing the
                                     sum of Column B and Column C).
Column E..........................  Applicable Percentage Col C/D. This
                                     column contains the ``applicable
                                     percentage'' representing the total
                                     computable FFY 1995 mental health
                                     facility DSH expenditures divided
                                     by total computable all inpatient
                                     hospital and mental health facility
                                     DSH expenditures for FFY 1995 (the
                                     amount in Column C divided by the
                                     amount in Column D) Per section
                                     1923(h)(2)(A)(ii)(II) of the Act,
                                     for FFYs after FY 2002, the
                                     applicable percentage can be no
                                     greater than 33 percent.
Column F..........................  FY 2006 Federal Share DSH Allotment.
                                     This column contains the States'
                                     final FFY 2005 DSH allotments.
Column G..........................  FFY 2006 FMAP.
Column H..........................  FY 2006 DSH Allotments in TC. Col. F/
                                     G. This column contains FFY 2006
                                     total computable DSH allotment
                                     (determined as Column F/Column G).
Column I..........................  Col E * Col H in TC. This column
                                     contains the applicable percent of
                                     FFY 2006 total computable DSH
                                     allotment (calculated as Column E x
                                     Column H).
Column J..........................  FY 2006 IMD DSH Limit Total
                                     Computable. Lesser of Col. C or I.
                                     The column contains the lesser of
                                     the lesser of Column I or C.
Column K..........................  FY 2006 IMD DSH Limit Federal Share,
                                     Col. G x J. This column contains
                                     the total computable IMD DSH Limit
                                     from Col. J and converts that
                                     amount into a Federal share
                                     (calculated as Col. G x Col. J).
Column L..........................  LOW DSH Status. This column contains
                                     Low DSH status for each State.
------------------------------------------------------------------------


          Key to Chart 4.--Preliminary FFY 2008 IMD DSH Limits
 [Key to the Chart of the FFY 2008 IMD Limitations.--The preliminary FFY
   2008 IMD DSH Limits for the regular States are presented in the top
  section of this chart and the preliminary FFY 2008 IMD DSH Limits for
   the Low-DSH States are presented in the Bottom Section of the Chart
------------------------------------------------------------------------
              Column                             Description
------------------------------------------------------------------------
Column A..........................  State.
Column B..........................  Inpatient Hospital Services FY 95
                                     DSH Total Computable. This column
                                     contains the States' total
                                     computable FFY 1995 inpatient
                                     hospital DSH expenditures as
                                     reported on the Form CMS-64.
Column C..........................  IMD and Mental Health Services FY 95
                                     DSH Total Computable. This column
                                     contains the total computable FFY
                                     1995 mental health facility DSH
                                     expenditures as reported on the
                                     Form CMS-64 as of January 1, 1997.
Column D..........................  Total Inpatient & IMD & Mental
                                     Health FY 95 DSH Total Computable,
                                     Col. B + C. This column contains
                                     the total computation of all
                                     inpatient hospital DSH expenditures
                                     and mental health facility DSH
                                     expenditures for FFY 1995 as
                                     reported on the Form CMS-64 as of
                                     January 1, 1997 (representing the
                                     sum of Column B and Column C).
Column E..........................  Applicable Percentage Col. C/D. This
                                     column contains the ``applicable
                                     percentage'' representing the total
                                     computable FFY 1995 mental health
                                     facility DSH expenditures divided
                                     by total computable all inpatient
                                     hospital and mental health facility
                                     DSH expenditures for FFY 1995 (the
                                     amount in Column C divided by the
                                     amount in Column D) Per section
                                     1923(h)(2)(A)(ii)(II) of the Act,
                                     for FFYs after FY 2002, the
                                     applicable percentage can be no
                                     greater than 33 percent.
Column F..........................  FY 2008 Federal Share DSH Allotment.
                                     This column contains the States'
                                     preliminary FFY 2008 DSH
                                     allotments.
Column G..........................  FFY 2008 FMAP.
Column H..........................  FY 2008 DSH Allotment Total
                                     Computable Col. F/G. This column
                                     contains FFY 2008 total computable
                                     DSH allotment (determined as Column
                                     F/Column G).
Column I..........................  Col E * Col H in TC. This column
                                     contains the applicable percent of
                                     FFY 2008 total computable DSH
                                     allotment (calculated as Column E x
                                     Column H)
Column J..........................  FY 2008 IMD DSH Limit Total
                                     Computable. Lesser of Col. C or I.
                                     The column contains the lesser of
                                     the lesser of Column I or C.
Column K..........................  FY 2008 IMD DSH Limit Federal Share,
                                     Col. G x J. This column contains
                                     the total computable IMD DSH Limit
                                     from Col. J and converts that
                                     amount into a Federal share
                                     (calculated as Col. G x Col. J).
Column L..........................  Low DSH Status. This column contains
                                     Low DSH status for each State.
------------------------------------------------------------------------


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[[Page 73838]]

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[[Page 73839]]

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[[Page 73840]]

[GRAPHIC] [TIFF OMITTED] TN28DE07.003

BILLING CODE 4120-01-P


[[Page 73841]]


    Authority: Section 1923(a)(2), (f), and (h) of the Social 
Security Act (42 U.S.C. 1396r-4(a)(2), (f), and (h), and Pub. L. 
105-33)

(Catalog of Federal Domestic Assistance Program No. 93.778, Medical 
Assistance Program)

    Dated: October 23, 3007.
Kerry Weems,
Acting Administrator, Centers for Medicare & Medicaid Services.

    Dated: November 8, 2007.
Michael O. Leavitt,
Secretary.
[FR Doc. E7-24486 Filed 12-27-07; 8:45 am]
BILLING CODE 4120-01-C

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