Medicare Program; CY 2020 Part A Premiums for the Uninsured Aged and for Certain Disabled Individuals Who Have Exhausted Other Entitlement, 61622-61625 [2019-24439]
Download as PDF
<![CDATA[
61622
Federal Register / Vol. 84, No. 219 / Wednesday, November 13, 2019 / Notices
Business Administration’s definition of
a small business (having revenues of
less than $7.5 million to $38.5 million
in any 1 year). Individuals and states are
not included in the definition of a small
entity. This annual notice announces
the Medicare Part A deductible and
coinsurance amounts for CY 2020 and
will have an impact on the Medicare
beneficiaries. As a result, we are not
preparing an analysis for the RFA
because the Secretary has determined
that this notice will not have a
significant economic impact on a
substantial number of small entities.
In addition, section 1102(b) of the Act
requires us to prepare a regulatory
impact analysis if a rule may have a
significant impact on the operations of
a substantial number of small rural
hospitals. This analysis must conform to
the provisions of section 604 of the
RFA. For purposes of section 1102(b) of
the Act, we define a small rural hospital
as a hospital that is located outside of
a metropolitan statistical area and has
fewer than 100 beds. This annual notice
announces the Medicare Part A
deductible and coinsurance amounts for
CY 2020 and will have an impact on the
Medicare beneficiaries. As a result, we
are not preparing an analysis for section
1102(b) of the Act because the Secretary
has determined that this notice will not
have a significant impact on the
operations of a substantial number of
small rural hospitals.
Section 202 of the Unfunded
Mandates Reform Act of 1995 also
requires that agencies assess anticipated
costs and benefits before issuing any
rule whose mandates require spending
in any 1 year of $100 million in 1995
dollars, updated annually for inflation.
In 2019, that threshold is approximately
$154 million. This notice does not
impose mandates that will have a
consequential effect of $154 million or
more 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.
This notice will not have a substantial
direct effect on state or local
governments, preempt state law, or
otherwise have federalism implications.
Executive Order 13771, titled
‘‘Reducing Regulation and Controlling
Regulatory Costs,’’ was issued on
January 30, 2017 (82 FR 9339, February
3, 2017). It has been determined that
this notice is a transfer notice that does
not impose more than de minimis costs
VerDate Sep<11>2014
17:23 Nov 12, 2019
Jkt 250001
and thus is not a regulatory action for
the purposes of E.O. 13771.
In accordance with the provisions of
Executive Order 12866, this notice was
reviewed by the Office of Management
and Budget.
Consistent with the Congressional
Review Act provisions of the Small
Business Regulatory Enforcement
Fairness Act of 1996 (5 U.S.C. 801 et
seq.), this notice has been transmitted to
the Congress and the Comptroller
General for review.
Although this notice does not
constitute a substantive rule, we
nevertheless prepared this Impact
Analysis section in the interest of
ensuring that the impacts of this notice
are fully understood.
Dated: October 24, 2019.
Seema Verma,
Administrator, Centers for Medicare &
Medicaid Services.
Dated: October 28, 2019.
Alex M. Azar II,
Secretary, Department of Health and Human
Services.
[FR Doc. 2019–24441 Filed 11–8–19; 4:15 pm]
BILLING CODE 4120–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
[CMS–8072–N]
RIN 0938–AT77
Medicare Program; CY 2020 Part A
Premiums for the Uninsured Aged and
for Certain Disabled Individuals Who
Have Exhausted Other Entitlement
Centers for Medicare &
Medicaid Services (CMS), HHS.
ACTION: Notice.
AGENCY:
This annual notice announces
Medicare’s Hospital Insurance (Part A)
premium for uninsured enrollees in
calendar year (CY) 2020. This premium
is paid by enrollees age 65 and over who
are not otherwise eligible for benefits
under Medicare Part A (hereafter known
as the ‘‘uninsured aged’’) and by certain
disabled individuals who have
exhausted other entitlement. The
monthly Part A premium for the 12
months beginning January 1, 2020 for
these individuals will be $458. The
premium for certain other individuals as
described in this notice will be $252.
DATES: The premium announced in this
notice is effective on January 1, 2020.
FOR FURTHER INFORMATION CONTACT:
Yaminee Thaker, (410) 786–7921.
SUMMARY:
PO 00000
Frm 00029
Fmt 4703
Sfmt 4703
SUPPLEMENTARY INFORMATION:
I. Background
Section 1818 of the Social Security
Act (the Act) provides for voluntary
enrollment in the Medicare Hospital
Insurance Program (Medicare Part A),
subject to payment of a monthly
premium, of certain persons aged 65
and older who are uninsured under the
Old-Age, Survivors, and Disability
Insurance (OASDI) program or the
Railroad Retirement Act and do not
otherwise meet the requirements for
entitlement to Medicare Part A. These
‘‘uninsured aged’’ individuals are
uninsured under the OASDI program or
the Railroad Retirement Act, because
they do not have 40 quarters of coverage
under Title II of the Act (or are/were not
married to someone who did). (Persons
insured under the OASDI program or
the Railroad Retirement Act and certain
others do not have to pay premiums for
Medicare Part A.)
Section 1818A of the Act provides for
voluntary enrollment in Medicare Part
A, subject to payment of a monthly
premium for certain disabled
individuals who have exhausted other
entitlement. These are individuals who
were entitled to coverage due to a
disabling impairment under section
226(b) of the Act, but who are no longer
entitled to disability benefits and free
Medicare Part A coverage because they
have gone back to work and their
earnings exceed the statutorily defined
‘‘substantial gainful activity’’ amount
(section 223(d)(4) of the Act).
Section 1818A(d)(2) of the Act
specifies that the provisions relating to
premiums under section 1818(d)
through section 1818(f) of the Act for
the aged will also apply to certain
disabled individuals as described above.
Section 1818(d)(1) of the Act requires
us to estimate, on an average per capita
basis, the amount to be paid from the
Federal Hospital Insurance Trust Fund
for services incurred in the upcoming
calendar year (CY) (including the
associated administrative costs) on
behalf of individuals aged 65 and over
who will be entitled to benefits under
Medicare Part A. We must then
determine the monthly actuarial rate for
the following year (the per capita
amount estimated above divided by 12)
and publish the dollar amount for the
monthly premium in the succeeding CY.
If the premium is not a multiple of $1,
the premium is rounded to the nearest
multiple of $1 (or, if it is a multiple of
50 cents but not of $1, it is rounded to
the next highest $1).
Section 13508 of the Omnibus Budget
Reconciliation Act of 1993 (Pub. L. 103–
66) amended section 1818(d) of the Act
E:\FR\FM\13NON1.SGM
13NON1
Federal Register / Vol. 84, No. 219 / Wednesday, November 13, 2019 / Notices
to provide for a reduction in the
premium amount for certain voluntary
enrollees (section 1818 and section
1818A of the Act). The reduction
applies to an individual who is eligible
to buy into the Medicare Part A program
and who, as of the last day of the
previous month:
• Had at least 30 quarters of coverage
under Title II of the Act;
• Was married, and had been married
for the previous 1 year period, to a
person who had at least 30 quarters of
coverage;
• Had been married to a person for at
least 1 year at the time of the person’s
death if, at the time of death, the person
had at least 30 quarters of coverage; or
• Is divorced from a person and had
been married to the person for at least
10 years at the time of the divorce if, at
the time of the divorce, the person had
at least 30 quarters of coverage.
Section 1818(d)(4)(A) of the Act
specifies that the premium that these
individuals will pay for CY 2020 will be
equal to the premium for uninsured
aged enrollees reduced by 45 percent.
Section 1818(g) of the Act requires the
Secretary, at the request of a state, to
enter into a Part A buy-in agreement
with a state to pay Medicare Part A
premiums for Qualified Medicare
Beneficiaries (QMBs). Under the QMB
program, state Medicaid agencies must
pay the Medicare Part A premium for
those not eligible for premium-free Part
A. (Entering into a Part A buy-in
agreement would permit a state to avoid
any Medicare late enrollment penalties
that the individual may owe and would
allow states to enroll persons in Part A
at any time of the year (without regard
to Medicare enrollment periods)).
II. Monthly Premium Amount for CY
2020
The monthly premium for the
uninsured aged and certain disabled
individuals who have exhausted other
entitlement for the 12 months beginning
January 1, 2020, is $458. The monthly
premium for the individuals eligible
under section 1818(d)(4)(B) of the Act,
and therefore, subject to the 45 percent
reduction in the monthly premium, is
$252.
III. Monthly Premium Rate Calculation
As discussed in section I of this
notice, the monthly Medicare Part A
premium is equal to the estimated
monthly actuarial rate for CY 2020
rounded to the nearest multiple of $1
and equals one-twelfth of the average
per capita amount, which is determined
by projecting the number of Medicare
Part A enrollees aged 65 years and over
as well as the benefits and
VerDate Sep<11>2014
17:23 Nov 12, 2019
Jkt 250001
administrative costs that will be
incurred on their behalf.
The steps involved in projecting these
future costs to the Federal Hospital
Insurance Trust Fund are:
• Establishing the present cost of
services furnished to beneficiaries, by
type of service, to serve as a projection
base;
• Projecting increases in payment
amounts for each of the service types;
and
• Projecting increases in
administrative costs.
We base our projections for CY 2020
on—(1) current historical data; and (2)
projection assumptions derived from
current law and the Mid-Session Review
of the President’s Fiscal Year 2020
Budget.
We estimate that in CY 2020,
53,313,570 people aged 65 years and
over will be entitled to (enrolled in)
benefits (without premium payment)
and that they will incur about $292.967
billion in benefits and related
administrative costs. Thus, the
estimated monthly average per capita
amount is $457.93 and the monthly
premium is $458. Subsequently, the full
monthly premium reduced by 45
percent is $252.
IV. Costs to Beneficiaries
The CY 2020 premium of $458 is
approximately 4.8 percent higher than
the CY 2019 premium of $437. We
estimate that approximately 691,000
enrollees will voluntarily enroll in
Medicare Part A, by paying the full
premium. We estimate that over 90
percent of these individuals will have
their Part A premium paid for by states,
since they are enrolled in the QMB
program. Furthermore, the CY 2020
reduced premium of $252 is
approximately 5.0 percent higher than
the CY 2019 premium of $240. We
estimate an additional 80,000 enrollees
will pay the reduced premium.
Therefore, we estimate that the total
aggregate cost to enrollees paying these
premiums in CY 2020, compared to the
amount that they paid in CY 2019, will
be about $186 million.
V. Waiver of Proposed Rulemaking
We ordinarily publish a notice of
proposed rulemaking in the Federal
Register and invite public comment
prior to a rule taking effect in
accordance with section 1871 of the Act
and section 553(b) of the Administrative
Procedure Act (APA). Section 1871(a)(2)
of the Act provides that no rule,
requirement, or other statement of
policy (other than a national coverage
determination) that establishes or
changes a substantive legal standard
PO 00000
Frm 00030
Fmt 4703
Sfmt 4703
61623
governing the scope of benefits, the
payment for services, or the eligibility of
individuals, entities, or organizations to
furnish or receive services or benefits
under Medicare shall take effect unless
it is promulgated through notice and
comment rulemaking. Unless there is a
statutory exception, section 1871(b)(1)
of the Act generally requires the
Secretary of the Department of Health
and Human Services (the Secretary) to
provide for notice of a proposed rule in
the Federal Register and provide a
period of not less than 60 days for
public comment before establishing or
changing a substantive legal standard
regarding the matters enumerated by the
statute. Similarly, under 5 U.S.C. 553(b)
of the APA, the agency is required to
publish a notice of proposed rulemaking
in the Federal Register before a
substantive rule takes effect. Section
553(d) of the APA and section
1871(e)(1)(B)(i) of the Act usually
require a 30-day delay in effective date
after issuance or publication of a rule,
subject to exceptions. Sections 553(b)(B)
and 553(d)(3) of the APA provide for
exceptions from the advance notice and
comment requirement and the delay in
effective date requirements. Sections
1871(b)(2)(C) and 1871(e)(1)(B)(ii) of the
Act also provide exceptions from the
notice and 60-day comment period and
the 30-day delay in effective date.
Section 553(b)(B) of the APA and
section 1871(b)(2)(C) of the Act
expressly authorize an agency to
dispense with notice and comment
rulemaking for good cause if the agency
makes a finding that notice and
comment procedures are impracticable,
unnecessary, or contrary to the public
interest.
The annual Part A premium
announcement set forth in this notice
does not establish or change a
substantive legal standard regarding the
matters enumerated by the statute or
constitute a substantive rule which
would be subject to the notice
requirements in section 553(b) of the
APA. However, to the extent that an
opportunity for public notice and
comment could be construed as
required for this notice, we find good
cause to waive this requirement.
Section 1818(d) of the Act requires
the Secretary during September of each
year to determine and publish the
amount to be paid, on an average per
capita basis, from the Federal Hospital
Insurance Trust Fund for services
incurred in the impending CY
(including the associated administrative
costs) on behalf of individuals aged 65
and over who will be entitled to benefits
under Medicare Part A. Further, the
statute requires that the agency
E:\FR\FM\13NON1.SGM
13NON1
61624
Federal Register / Vol. 84, No. 219 / Wednesday, November 13, 2019 / Notices
determine the applicable premium
amount for each calendar year in
accordance with the statutory formula,
and we are simply notifying the public
of the changes to the Medicare Part A
premiums for CY 2020. We have
calculated the Part A premiums as
directed by the statute; the statute
establishes both when the premium
amounts must be published and the
information that the Secretary must
factor into the premium amounts, so we
do not have any discretion in that
regard. We find notice and comment
procedures to be unnecessary for this
notice and we find good cause to waive
such procedures under section 553(b)(B)
of the APA and section 1871(b)(2)(C) of
the Act, if such procedures may be
construed to be required at all. Through
this notice, we are simply notifying the
public of the updates to the Medicare
Part A premiums, in accordance with
the statute, for CY 2020. As such, we
also note that even if notice and
comment procedures were required for
this notice, for the reasons stated above,
we would find good cause to waive the
delay in effective date of the notice, as
additional delay would be contrary to
the public interest under section
1871(e)(1)(B)(ii) of the Act. Publication
of this notice is consistent with section
1818(d) of the Act, and we believe that
any potential delay in the effective date
of the notice, if such delay were
required at all, could cause unnecessary
confusion both for the agency and
Medicare beneficiaries.
VI. Collection of Information
Requirements
This document does not impose
information collection requirements,
that is, reporting, recordkeeping or
third-party disclosure requirements.
Consequently, there is no need for
review by the Office of Management and
Budget under the authority of the
Paperwork Reduction Act of 1995 (44
U.S.C. 3501 et seq.).
VII. Regulatory Impact Analysis
A. Statement of Need
Section 1818(d) of the Act requires
the Secretary of the Department of
Health and Human Services (the
Secretary) during September of each
year to determine and publish the
amount to be paid, on an average per
capita basis, from the Federal Hospital
Insurance Trust Fund for services
incurred in the impending CY
(including the associated administrative
costs) on behalf of individuals aged 65
and over who will be entitled to benefits
under Medicare Part A.
VerDate Sep<11>2014
17:23 Nov 12, 2019
Jkt 250001
B. Overall Impact
We have examined the impacts of this
notice in accordance with Executive
Order 12866 on Regulatory Planning
and Review (September 30, 1993),
Executive Order 13563 on Improving
Regulation and Regulatory Review
(January 18, 2011), the Regulatory
Flexibility Act (RFA) (September 19,
1980, Pub. L. 96–354), section 1102(b) of
the Social Security Act, section 202 of
the Unfunded Mandates Reform Act of
1995 (March 22, 1995; Pub. L. 104–4),
Executive Order 13132 on Federalism
(August 4, 1999), the Congressional
Review Act (5 U.S.C. 804(2)), and
Executive Order 13771 on Reducing
Regulation and Controlling Regulatory
Costs (January 30, 2017).
Executive Orders 12866 and 13563
direct 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). Section 3(f) of Executive Order
12866 defines a ‘‘significant regulatory
action’’ as an action that is likely to
result in a rule: (1) Having an annual
effect on the economy of $100 million
or more in any 1 year, or adversely and
materially affecting a sector of the
economy, productivity, competition,
jobs, the environment, public health or
safety, or state, local or tribal
governments or communities (also
referred to as ‘‘economically
significant’’); (2) creating a serious
inconsistency or otherwise interfering
with an action taken or planned by
another agency; (3) materially altering
the budgetary impacts of entitlement
grants, user fees, or loan programs or the
rights and obligations of recipients
thereof; or (4) raising novel legal or
policy issues arising out of legal
mandates, the President’s priorities, or
the principles set forth in the Executive
Order.
A regulatory impact analysis (RIA)
must be prepared for major rules with
economically significant effects ($100
million or more in any 1 year). Although
we do not consider this notice to
constitute a substantive rule, this notice
is economically significant under
section 3(f)(1) of Executive Order 12866.
As stated in section IV of this notice, we
estimate that the overall effect of the
changes in the Part A premium will be
a cost to voluntary enrollees (section
1818 and section 1818A of the Act) of
about $186 million.
The RFA requires agencies to analyze
options for regulatory relief of small
PO 00000
Frm 00031
Fmt 4703
Sfmt 4703
entities, if a rule has a significant impact
on a substantial number of small
entities. 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
being nonprofit organizations or by
meeting the Small Business
Administration’s definition of a small
business (having revenues of less than
$7.5 million to $38.5 million in any 1
year). Individuals and states are not
included in the definition of a small
entity. This annual notice announces
the Medicare Part A premiums for CY
2020 and will have an impact on certain
Medicare beneficiaries. As a result, we
are not preparing an analysis for the
RFA because the Secretary has
determined that this notice will not
have a significant economic impact on
a substantial number of small entities.
In addition, section 1102(b) of the Act
requires us to prepare an RIA if a rule
may have a significant impact on the
operations of a substantial number of
small rural hospitals. This analysis must
conform to the provisions of section 604
of the RFA. For purposes of section
1102(b) of the Act, we define a small
rural hospital as a hospital that is
located outside of a metropolitan
statistical area and has fewer than 100
beds. This annual notice announces the
Medicare Part A premiums for CY 2020
and will have an impact on certain
Medicare beneficiaries. As a result, we
are not preparing an analysis for section
1102(b) of the Act, because the Secretary
has determined that this notice will not
have a significant impact on the
operations of a substantial number of
small rural hospitals.
Section 202 of the Unfunded
Mandates Reform Act of 1995 also
requires that agencies assess anticipated
costs and benefits before issuing any
rule whose mandates require spending
in any 1 year of $100 million in 1995
dollars, updated annually for inflation.
In 2019, that threshold is approximately
$154 million. This notice does not
impose mandates that will have a
consequential effect of $154 million or
more 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.
This notice will not have a substantial
direct effect on state or local
E:\FR\FM\13NON1.SGM
13NON1
Federal Register / Vol. 84, No. 219 / Wednesday, November 13, 2019 / Notices
governments, preempt state law, or
otherwise have federalism implications.
Executive Order 13771, titled
‘‘Reducing Regulation and Controlling
Regulatory Costs,’’ was issued on
January 30, 2017 (82 FR 9339, February
3, 2017). It has been determined that
this notice is a transfer notice that does
not impose more than de minimis costs
and thus is not a regulatory action for
the purposes of E.O. 13771.
In accordance with the provisions of
Executive Order 12866, this notice was
reviewed by the Office of Management
and Budget.
Consistent with the Congressional
Review Act provisions of the Small
Business Regulatory Enforcement
Fairness Act of 1996 (5 U.S.C. 801 et
seq.), this notice has been transmitted to
the Congress and the Comptroller
General for review.
Although this notice does not
constitute a substantive rule, we
nevertheless prepared this Impact
Analysis section in the interest of
ensuring that the impacts of this notice
are fully understood.
Dated: October 24, 2019.
Seema Verma,
Administrator, Centers for Medicare &
Medicaid Services.
Dated: October 28, 2019.
Alex M. Azar II,
Secretary, Department of Health and Human
Services.
[FR Doc. 2019–24439 Filed 11–8–19; 4:15 pm]
BILLING CODE 4120–01–P
DEPARTMENT OF HEALTH AND
HUMAN SERVICES
Centers for Medicare & Medicaid
Services
[CMS–8073–N]
RIN 0938–AT78
Medicare Program; Medicare Part B
Monthly Actuarial Rates, Premium
Rates, and Annual Deductible
Beginning January 1, 2020
Centers for Medicare &
Medicaid Services (CMS), HHS.
ACTION: Notice.
AGENCY:
This notice announces the
monthly actuarial rates for aged (age 65
and over) and disabled (under age 65)
beneficiaries enrolled in Part B of the
Medicare Supplementary Medical
Insurance (SMI) program beginning
January 1, 2020. In addition, this notice
announces the monthly premium for
aged and disabled beneficiaries, the
deductible for 2020, and the incomerelated monthly adjustment amounts to
SUMMARY:
VerDate Sep<11>2014
17:23 Nov 12, 2019
Jkt 250001
be paid by beneficiaries with modified
adjusted gross income above certain
threshold amounts. The monthly
actuarial rates for 2020 are $283.20 for
aged enrollees and $343.60 for disabled
enrollees. The standard monthly Part B
premium rate for all enrollees for 2020
is $144.60, which is equal to 50 percent
of the monthly actuarial rate for aged
enrollees (or approximately 25 percent
of the expected average total cost of Part
B coverage for aged enrollees) plus
$3.00 repayment amount required under
current law. (The 2019 standard
premium rate was $135.50, which
included the $3.00 repayment amount.)
The Part B deductible for 2020 is
$198.00 for all Part B beneficiaries. If a
beneficiary has to pay an income-related
monthly adjustment, he or she will have
to pay a total monthly premium of about
35, 50, 65, 80 or 85 percent of the total
cost of Part B coverage plus a repayment
amount of $4.20, $6.00, $7.80, $9.60 or
$10.20 respectively.
DATES: The monthly actuarial rates,
premium rates, and annual deductible
announced in this notice are effective
January 1, 2020.
FOR FURTHER INFORMATION CONTACT: M.
Kent Clemens, (410) 786–6391.
SUPPLEMENTARY INFORMATION:
I. Background
Part B is the voluntary portion of the
Medicare program that pays all or part
of the costs for physicians’ services;
outpatient hospital services; certain
home health services; services furnished
by rural health clinics, ambulatory
surgical centers, and comprehensive
outpatient rehabilitation facilities; and
certain other medical and health
services not covered by Medicare Part
A, Hospital Insurance. Medicare Part B
is available to individuals who are
entitled to Medicare Part A, as well as
to U.S. residents who have attained age
65 and are citizens and to aliens who
were lawfully admitted for permanent
residence and have resided in the
United States for 5 consecutive years.
Part B requires enrollment and payment
of monthly premiums, as described in
42 CFR part 407, subpart B, and part
408, respectively. The premiums paid
by (or on behalf of) all enrollees fund
approximately one-fourth of the total
incurred costs, and transfers from the
general fund of the Treasury pay
approximately three-fourths of these
costs.
The Secretary of the Department of
Health and Human Services (the
Secretary) is required by section 1839 of
the Social Security Act (the Act) to
announce the Part B monthly actuarial
rates for aged and disabled beneficiaries
PO 00000
Frm 00032
Fmt 4703
Sfmt 4703
61625
as well as the monthly Part B premium.
The Part B annual deductible is
included because its determination is
directly linked to the aged actuarial rate.
The monthly actuarial rates for aged
and disabled enrollees are used to
determine the correct amount of general
revenue financing per beneficiary each
month. These amounts, according to
actuarial estimates, will equal,
respectively, one-half of the expected
average monthly cost of Part B for each
aged enrollee (age 65 or over) and onehalf of the expected average monthly
cost of Part B for each disabled enrollee
(under age 65).
The Part B deductible to be paid by
enrollees is also announced. Prior to the
Medicare Prescription Drug,
Improvement, and Modernization Act of
2003 (MMA) (Pub. L. 108–173), the Part
B deductible was set in statute. After
setting the 2005 deductible amount at
$110, section 629 of the MMA
(amending section 1833(b) of the Act)
required that the Part B deductible be
indexed beginning in 2006. The
inflation factor to be used each year is
the annual percentage increase in the
Part B actuarial rate for enrollees age 65
and over. Specifically, the 2020 Part B
deductible is calculated by multiplying
the 2019 deductible by the ratio of the
2020 aged actuarial rate to the 2019 aged
actuarial rate. The amount determined
under this formula is then rounded to
the nearest $1.
The monthly Part B premium rate to
be paid by aged and disabled enrollees
is also announced. (Although the costs
to the program per disabled enrollee are
different than for the aged, the statute
provides that they pay the same
premium amount.) Beginning with the
passage of section 203 of the Social
Security Amendments of 1972 (Pub. L.
92–603), the premium rate, which was
determined on a fiscal-year basis, was
limited to the lesser of the actuarial rate
for aged enrollees, or the current
monthly premium rate increased by the
same percentage as the most recent
general increase in monthly Title II
Social Security benefits.
However, the passage of section 124
of the Tax Equity and Fiscal
Responsibility Act of 1982 (TEFRA)
(Pub. L. 97–248) suspended this
premium determination process.
Section 124 of TEFRA changed the
premium basis to 50 percent of the
monthly actuarial rate for aged enrollees
(that is, 25 percent of program costs for
aged enrollees). Section 606 of the
Social Security Amendments of 1983
(Pub. L. 98–21), section 2302 of the
Deficit Reduction Act of 1984 (DEFRA
84) (Pub. L. 98–369), section 9313 of the
Consolidated Omnibus Budget
E:\FR\FM\13NON1.SGM
13NON1
]]>Agencies
[Federal Register Volume 84, Number 219 (Wednesday, November 13, 2019)]
[Notices]
[Pages 61622-61625]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-24439]
-----------------------------------------------------------------------
DEPARTMENT OF HEALTH AND HUMAN SERVICES
Centers for Medicare & Medicaid Services
[CMS-8072-N]
RIN 0938-AT77
Medicare Program; CY 2020 Part A Premiums for the Uninsured Aged
and for Certain Disabled Individuals Who Have Exhausted Other
Entitlement
AGENCY: Centers for Medicare & Medicaid Services (CMS), HHS.
ACTION: Notice.
-----------------------------------------------------------------------
SUMMARY: This annual notice announces Medicare's Hospital Insurance
(Part A) premium for uninsured enrollees in calendar year (CY) 2020.
This premium is paid by enrollees age 65 and over who are not otherwise
eligible for benefits under Medicare Part A (hereafter known as the
``uninsured aged'') and by certain disabled individuals who have
exhausted other entitlement. The monthly Part A premium for the 12
months beginning January 1, 2020 for these individuals will be $458.
The premium for certain other individuals as described in this notice
will be $252.
DATES: The premium announced in this notice is effective on January 1,
2020.
FOR FURTHER INFORMATION CONTACT: Yaminee Thaker, (410) 786-7921.
SUPPLEMENTARY INFORMATION:
I. Background
Section 1818 of the Social Security Act (the Act) provides for
voluntary enrollment in the Medicare Hospital Insurance Program
(Medicare Part A), subject to payment of a monthly premium, of certain
persons aged 65 and older who are uninsured under the Old-Age,
Survivors, and Disability Insurance (OASDI) program or the Railroad
Retirement Act and do not otherwise meet the requirements for
entitlement to Medicare Part A. These ``uninsured aged'' individuals
are uninsured under the OASDI program or the Railroad Retirement Act,
because they do not have 40 quarters of coverage under Title II of the
Act (or are/were not married to someone who did). (Persons insured
under the OASDI program or the Railroad Retirement Act and certain
others do not have to pay premiums for Medicare Part A.)
Section 1818A of the Act provides for voluntary enrollment in
Medicare Part A, subject to payment of a monthly premium for certain
disabled individuals who have exhausted other entitlement. These are
individuals who were entitled to coverage due to a disabling impairment
under section 226(b) of the Act, but who are no longer entitled to
disability benefits and free Medicare Part A coverage because they have
gone back to work and their earnings exceed the statutorily defined
``substantial gainful activity'' amount (section 223(d)(4) of the Act).
Section 1818A(d)(2) of the Act specifies that the provisions
relating to premiums under section 1818(d) through section 1818(f) of
the Act for the aged will also apply to certain disabled individuals as
described above.
Section 1818(d)(1) of the Act requires us to estimate, on an
average per capita basis, the amount to be paid from the Federal
Hospital Insurance Trust Fund for services incurred in the upcoming
calendar year (CY) (including the associated administrative costs) on
behalf of individuals aged 65 and over who will be entitled to benefits
under Medicare Part A. We must then determine the monthly actuarial
rate for the following year (the per capita amount estimated above
divided by 12) and publish the dollar amount for the monthly premium in
the succeeding CY. If the premium is not a multiple of $1, the premium
is rounded to the nearest multiple of $1 (or, if it is a multiple of 50
cents but not of $1, it is rounded to the next highest $1).
Section 13508 of the Omnibus Budget Reconciliation Act of 1993
(Pub. L. 103-66) amended section 1818(d) of the Act
[[Page 61623]]
to provide for a reduction in the premium amount for certain voluntary
enrollees (section 1818 and section 1818A of the Act). The reduction
applies to an individual who is eligible to buy into the Medicare Part
A program and who, as of the last day of the previous month:
Had at least 30 quarters of coverage under Title II of the
Act;
Was married, and had been married for the previous 1 year
period, to a person who had at least 30 quarters of coverage;
Had been married to a person for at least 1 year at the
time of the person's death if, at the time of death, the person had at
least 30 quarters of coverage; or
Is divorced from a person and had been married to the
person for at least 10 years at the time of the divorce if, at the time
of the divorce, the person had at least 30 quarters of coverage.
Section 1818(d)(4)(A) of the Act specifies that the premium that
these individuals will pay for CY 2020 will be equal to the premium for
uninsured aged enrollees reduced by 45 percent.
Section 1818(g) of the Act requires the Secretary, at the request
of a state, to enter into a Part A buy-in agreement with a state to pay
Medicare Part A premiums for Qualified Medicare Beneficiaries (QMBs).
Under the QMB program, state Medicaid agencies must pay the Medicare
Part A premium for those not eligible for premium-free Part A.
(Entering into a Part A buy-in agreement would permit a state to avoid
any Medicare late enrollment penalties that the individual may owe and
would allow states to enroll persons in Part A at any time of the year
(without regard to Medicare enrollment periods)).
II. Monthly Premium Amount for CY 2020
The monthly premium for the uninsured aged and certain disabled
individuals who have exhausted other entitlement for the 12 months
beginning January 1, 2020, is $458. The monthly premium for the
individuals eligible under section 1818(d)(4)(B) of the Act, and
therefore, subject to the 45 percent reduction in the monthly premium,
is $252.
III. Monthly Premium Rate Calculation
As discussed in section I of this notice, the monthly Medicare Part
A premium is equal to the estimated monthly actuarial rate for CY 2020
rounded to the nearest multiple of $1 and equals one-twelfth of the
average per capita amount, which is determined by projecting the number
of Medicare Part A enrollees aged 65 years and over as well as the
benefits and administrative costs that will be incurred on their
behalf.
The steps involved in projecting these future costs to the Federal
Hospital Insurance Trust Fund are:
Establishing the present cost of services furnished to
beneficiaries, by type of service, to serve as a projection base;
Projecting increases in payment amounts for each of the
service types; and
Projecting increases in administrative costs.
We base our projections for CY 2020 on--(1) current historical
data; and (2) projection assumptions derived from current law and the
Mid-Session Review of the President's Fiscal Year 2020 Budget.
We estimate that in CY 2020, 53,313,570 people aged 65 years and
over will be entitled to (enrolled in) benefits (without premium
payment) and that they will incur about $292.967 billion in benefits
and related administrative costs. Thus, the estimated monthly average
per capita amount is $457.93 and the monthly premium is $458.
Subsequently, the full monthly premium reduced by 45 percent is $252.
IV. Costs to Beneficiaries
The CY 2020 premium of $458 is approximately 4.8 percent higher
than the CY 2019 premium of $437. We estimate that approximately
691,000 enrollees will voluntarily enroll in Medicare Part A, by paying
the full premium. We estimate that over 90 percent of these individuals
will have their Part A premium paid for by states, since they are
enrolled in the QMB program. Furthermore, the CY 2020 reduced premium
of $252 is approximately 5.0 percent higher than the CY 2019 premium of
$240. We estimate an additional 80,000 enrollees will pay the reduced
premium. Therefore, we estimate that the total aggregate cost to
enrollees paying these premiums in CY 2020, compared to the amount that
they paid in CY 2019, will be about $186 million.
V. Waiver of Proposed Rulemaking
We ordinarily publish a notice of proposed rulemaking in the
Federal Register and invite public comment prior to a rule taking
effect in accordance with section 1871 of the Act and section 553(b) of
the Administrative Procedure Act (APA). Section 1871(a)(2) of the Act
provides that no rule, requirement, or other statement of policy (other
than a national coverage determination) that establishes or changes a
substantive legal standard governing the scope of benefits, the payment
for services, or the eligibility of individuals, entities, or
organizations to furnish or receive services or benefits under Medicare
shall take effect unless it is promulgated through notice and comment
rulemaking. Unless there is a statutory exception, section 1871(b)(1)
of the Act generally requires the Secretary of the Department of Health
and Human Services (the Secretary) to provide for notice of a proposed
rule in the Federal Register and provide a period of not less than 60
days for public comment before establishing or changing a substantive
legal standard regarding the matters enumerated by the statute.
Similarly, under 5 U.S.C. 553(b) of the APA, the agency is required to
publish a notice of proposed rulemaking in the Federal Register before
a substantive rule takes effect. Section 553(d) of the APA and section
1871(e)(1)(B)(i) of the Act usually require a 30-day delay in effective
date after issuance or publication of a rule, subject to exceptions.
Sections 553(b)(B) and 553(d)(3) of the APA provide for exceptions from
the advance notice and comment requirement and the delay in effective
date requirements. Sections 1871(b)(2)(C) and 1871(e)(1)(B)(ii) of the
Act also provide exceptions from the notice and 60-day comment period
and the 30-day delay in effective date. Section 553(b)(B) of the APA
and section 1871(b)(2)(C) of the Act expressly authorize an agency to
dispense with notice and comment rulemaking for good cause if the
agency makes a finding that notice and comment procedures are
impracticable, unnecessary, or contrary to the public interest.
The annual Part A premium announcement set forth in this notice
does not establish or change a substantive legal standard regarding the
matters enumerated by the statute or constitute a substantive rule
which would be subject to the notice requirements in section 553(b) of
the APA. However, to the extent that an opportunity for public notice
and comment could be construed as required for this notice, we find
good cause to waive this requirement.
Section 1818(d) of the Act requires the Secretary during September
of each year to determine and publish the amount to be paid, on an
average per capita basis, from the Federal Hospital Insurance Trust
Fund for services incurred in the impending CY (including the
associated administrative costs) on behalf of individuals aged 65 and
over who will be entitled to benefits under Medicare Part A. Further,
the statute requires that the agency
[[Page 61624]]
determine the applicable premium amount for each calendar year in
accordance with the statutory formula, and we are simply notifying the
public of the changes to the Medicare Part A premiums for CY 2020. We
have calculated the Part A premiums as directed by the statute; the
statute establishes both when the premium amounts must be published and
the information that the Secretary must factor into the premium
amounts, so we do not have any discretion in that regard. We find
notice and comment procedures to be unnecessary for this notice and we
find good cause to waive such procedures under section 553(b)(B) of the
APA and section 1871(b)(2)(C) of the Act, if such procedures may be
construed to be required at all. Through this notice, we are simply
notifying the public of the updates to the Medicare Part A premiums, in
accordance with the statute, for CY 2020. As such, we also note that
even if notice and comment procedures were required for this notice,
for the reasons stated above, we would find good cause to waive the
delay in effective date of the notice, as additional delay would be
contrary to the public interest under section 1871(e)(1)(B)(ii) of the
Act. Publication of this notice is consistent with section 1818(d) of
the Act, and we believe that any potential delay in the effective date
of the notice, if such delay were required at all, could cause
unnecessary confusion both for the agency and Medicare beneficiaries.
VI. Collection of Information Requirements
This document does not impose information collection requirements,
that is, reporting, recordkeeping or third-party disclosure
requirements. Consequently, there is no need for review by the Office
of Management and Budget under the authority of the Paperwork Reduction
Act of 1995 (44 U.S.C. 3501 et seq.).
VII. Regulatory Impact Analysis
A. Statement of Need
Section 1818(d) of the Act requires the Secretary of the Department
of Health and Human Services (the Secretary) during September of each
year to determine and publish the amount to be paid, on an average per
capita basis, from the Federal Hospital Insurance Trust Fund for
services incurred in the impending CY (including the associated
administrative costs) on behalf of individuals aged 65 and over who
will be entitled to benefits under Medicare Part A.
B. Overall Impact
We have examined the impacts of this notice in accordance with
Executive Order 12866 on Regulatory Planning and Review (September 30,
1993), Executive Order 13563 on Improving Regulation and Regulatory
Review (January 18, 2011), the Regulatory Flexibility Act (RFA)
(September 19, 1980, Pub. L. 96-354), section 1102(b) of the Social
Security Act, section 202 of the Unfunded Mandates Reform Act of 1995
(March 22, 1995; Pub. L. 104-4), Executive Order 13132 on Federalism
(August 4, 1999), the Congressional Review Act (5 U.S.C. 804(2)), and
Executive Order 13771 on Reducing Regulation and Controlling Regulatory
Costs (January 30, 2017).
Executive Orders 12866 and 13563 direct 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). Section
3(f) of Executive Order 12866 defines a ``significant regulatory
action'' as an action that is likely to result in a rule: (1) Having an
annual effect on the economy of $100 million or more in any 1 year, or
adversely and materially affecting a sector of the economy,
productivity, competition, jobs, the environment, public health or
safety, or state, local or tribal governments or communities (also
referred to as ``economically significant''); (2) creating a serious
inconsistency or otherwise interfering with an action taken or planned
by another agency; (3) materially altering the budgetary impacts of
entitlement grants, user fees, or loan programs or the rights and
obligations of recipients thereof; or (4) raising novel legal or policy
issues arising out of legal mandates, the President's priorities, or
the principles set forth in the Executive Order.
A regulatory impact analysis (RIA) must be prepared for major rules
with economically significant effects ($100 million or more in any 1
year). Although we do not consider this notice to constitute a
substantive rule, this notice is economically significant under section
3(f)(1) of Executive Order 12866. As stated in section IV of this
notice, we estimate that the overall effect of the changes in the Part
A premium will be a cost to voluntary enrollees (section 1818 and
section 1818A of the Act) of about $186 million.
The RFA requires agencies to analyze options for regulatory relief
of small entities, if a rule has a significant impact on a substantial
number of small entities. 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 being nonprofit organizations
or by meeting the Small Business Administration's definition of a small
business (having revenues of less than $7.5 million to $38.5 million in
any 1 year). Individuals and states are not included in the definition
of a small entity. This annual notice announces the Medicare Part A
premiums for CY 2020 and will have an impact on certain Medicare
beneficiaries. As a result, we are not preparing an analysis for the
RFA because the Secretary has determined that this notice will not have
a significant economic impact on a substantial number of small
entities.
In addition, section 1102(b) of the Act requires us to prepare an
RIA if a rule may have a significant impact on the operations of a
substantial number of small rural hospitals. This analysis must conform
to the provisions of section 604 of the RFA. For purposes of section
1102(b) of the Act, we define a small rural hospital as a hospital that
is located outside of a metropolitan statistical area and has fewer
than 100 beds. This annual notice announces the Medicare Part A
premiums for CY 2020 and will have an impact on certain Medicare
beneficiaries. As a result, we are not preparing an analysis for
section 1102(b) of the Act, because the Secretary has determined that
this notice will not have a significant impact on the operations of a
substantial number of small rural hospitals.
Section 202 of the Unfunded Mandates Reform Act of 1995 also
requires that agencies assess anticipated costs and benefits before
issuing any rule whose mandates require spending in any 1 year of $100
million in 1995 dollars, updated annually for inflation. In 2019, that
threshold is approximately $154 million. This notice does not impose
mandates that will have a consequential effect of $154 million or more
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. This notice will not have a substantial direct effect on
state or local
[[Page 61625]]
governments, preempt state law, or otherwise have federalism
implications.
Executive Order 13771, titled ``Reducing Regulation and Controlling
Regulatory Costs,'' was issued on January 30, 2017 (82 FR 9339,
February 3, 2017). It has been determined that this notice is a
transfer notice that does not impose more than de minimis costs and
thus is not a regulatory action for the purposes of E.O. 13771.
In accordance with the provisions of Executive Order 12866, this
notice was reviewed by the Office of Management and Budget.
Consistent with the Congressional Review Act provisions of the
Small Business Regulatory Enforcement Fairness Act of 1996 (5 U.S.C.
801 et seq.), this notice has been transmitted to the Congress and the
Comptroller General for review.
Although this notice does not constitute a substantive rule, we
nevertheless prepared this Impact Analysis section in the interest of
ensuring that the impacts of this notice are fully understood.
Dated: October 24, 2019.
Seema Verma,
Administrator, Centers for Medicare & Medicaid Services.
Dated: October 28, 2019.
Alex M. Azar II,
Secretary, Department of Health and Human Services.
[FR Doc. 2019-24439 Filed 11-8-19; 4:15 pm]
BILLING CODE 4120-01-P
