Supplemental Security Income; Determining Disability for a Child Under Age 18

SOCIAL SECURITY ADMINISTRATION

20 CFR Parts 404 and 416

[Regulations No. 4 and 16]

RIN 0960-AF40

Supplemental Security Income; Determining Disability for a Child Under Age 18

AGENCY:

Social Security Administration.

ACTION:

Final rules.

SUMMARY:

On February 11, 1997, we published interim final rules with a request for comments to implement the Supplemental Security Income (SSI) childhood disability provisions of sections 211 and 212 of Public Law (Pub. L.) 104-193, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996. We are now publishing revised final rules in response to public comments. We are also conforming our rules to amendments to Public Law 104-193 made by the Balanced Budget Act of 1997, Public Law 105-33. Finally, we are simplifying and clarifying some rules in keeping with the President's goal of using plain language in regulations.

DATES:

These rules are effective January 2, 2001.

FOR FURTHER INFORMATION CONTACT:

Georgia Myers, Regulations Officer, Social Security Administration, 6401 Security Boulevard, Baltimore, MD 21235, regulations@ssa.gov, (410) 965-3632 or TTY (410) 966-5609 for information about these rules. For information on eligibility or filing for benefits, call our national toll-free number, 1-800-772-1213 or TTY 1-800-325-0778, or visit our Internet web site,

SSA Online

, at www.ssa.gov.

SUPPLEMENTARY INFORMATION:

We are revising and making final the interim final rules we published on February 11, 1997, to implement the childhood disability provisions of Public Law 104-193 (62 FR 6408). Even though we published interim final rules in 1997, we asked for public comments on those rules. We are now summarizing and responding to the public comments and making revisions to the interim final rules based on the public comments and on our program experience in applying the interim rules since February 1997. In the final rules, we continue to define the statutory standard of “marked and severe functional limitations” in terms of marked limitations in two areas of functioning or extreme limitation in one such area. However, we are also making a number of changes to our rules on functional equivalence and “other factors” in response to the comments.

We are also conforming our rules to amendments to Public Law 104-193 made by the Balanced Budget Act of 1997, Public Law 105-33, 111 Stat. 251. Even though the amendments were enacted after we published the interim final rules, the changes are required by the statute and make no discretionary policy changes. We are also simplifying and clarifying the language of some rules in keeping with the President's goal of using plain language in regulations.

A number of individuals who commented on the interim final rules expressed concern that we had not consulted with outside experts in the development of those rules. Given the short time we had under Public Law 104-193 to develop the interim final rules, it was not feasible to engage in the type of consultation the commenters suggested before we published those rules. However, in response to the comments, and to ensure that these final rules are as accurate and inclusive as possible, we asked a number of individual experts for information as we formulated these final rules. The experts included pediatricians, psychologists, and other pediatric specialists, and individual advocates for children with disabilities who have expert knowledge about the SSI program.

History

For a detailed history of the childhood disability provisions before the changes made by Public Law 104-193, interested readers may review the preamble to the interim final rules (62 FR 6408). That preamble explains how we first implemented the prior statutory definition of disability for children, based on “comparable severity” to the definition of disability for adults, and the changes we made to our rules in 1991 after the Supreme Court's decision in

Sullivan

v.

Zebley

, 493 U.S. 521 (1990).

Public Law 104-193, the Personal Responsibility and Work Opportunity Reconciliation Act of 1996, 110 Stat. 2105, removed the comparable severity standard and provided a new statutory definition of disability for children claiming SSI benefits. It also directed us to make significant changes in the way we evaluate childhood disability claims. Under the law, which created a new section 1614(a)(3)(C) of the Social Security Act (the Act), a child's impairment or combination of impairments must cause more serious impairment-related limitations than the old law and our prior regulations specified.

Section 1614(a)(3)(C) of the Act provides the following definition of disability for children claiming SSI benefits:

(C)(i) An individual under the age of 18 shall be considered disabled for the purposes of this title if that individual has a medically determinable physical or mental impairment, which results in marked and severe functional limitations, and which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months.

(ii) Notwithstanding clause (i), no individual under the age of 18 who engages in substantial gainful activity * * * may be considered to be disabled.

The conference report that accompanied Public Law 104-193 explained:

The conferees intend that only needy children with severe disabilities be eligible for SSI, and the Listing of Impairments and other current disability determination regulations as modified by these provisions properly reflect the severity of disability contemplated by the new statutory definition. In those areas of the Listing that involve domains of functioning, the conferees expect no less than two marked limitations as the standard for qualification. The conferees are also aware that SSA uses the term “severe” to often mean “other than minor” in an initial screening procedure for disability determination and in other places. The conferees, however, use the term “severe” in its common sense meaning.

H.R. Conf. Rep. No. 725, 104th Cong., 2d Sess. 328 (1996),

reprinted in

1996 U.S. Code, Cong. and Ad. News 2649, 2716. The House report contains similar language. See H.R. Rep. No. 651, 104th Cong., 2d Sess. 1385 (1996),

reprinted in

1996 U.S. Code, Cong. and Ad. News 2183, 2444.

Further provisions concerning childhood disability adjudication are summarized below with references to the relevant sections of Public Law 104-193 and, where appropriate, the Act.

• We were directed to remove references to “maladaptive behavior” in the prior personal/behavioral domain from §§ 112.00C2 and 112.02B2c(2) of the childhood mental disorders listings (Public Law 104-193, section 211(b)(1)).

• We were directed to discontinue the individualized functional assessment (IFA) for children in §§ 416.924d and 416.924e of our former rules, which we had used since 1991 (Pub. L. 104-193, section 211(b)(2)).

• Within 1 year after the date of enactment, we were to redetermine the eligibility of individuals under the age

of 18 who qualified for SSI based on disability as of August 22, 1996, and whose eligibility might terminate because of changes made by Public Law 104-193. We were required to use the eligibility criteria we use for new applicants, not the medical improvement review standard in section 1614(a)(4) of the Act and § 416.994a that we use in continuing disability reviews (CDRs) (Pub. L. 104-193, section 211(d)(2)).

• The medical improvement review standard for determining continuing eligibility for children was revised to conform to the new definition of disability for children (Pub. L. 104-193, section 211(c); section 1614(a)(4)(B) of the Act).

• Not less frequently than once every 3 years, we must conduct a CDR for any childhood disability recipient eligible by reason of an impairment(s) that is likely to improve. At the option of the Commissioner, we may also perform a CDR with respect to those individuals under age 18 whose impairments are unlikely to improve (Pub. L. 104-193, section 212(a); section 1614(a)(3)(H)(ii) of the Act).

• We must redetermine the eligibility of individuals who were eligible for SSI based on disability in the month before the month in which they attained age 18. This age-18 redetermination must use the initial adult eligibility rules and must occur during the 1-year period beginning on the individual's 18th birthday. The medical improvement review standard used in CDRs does not apply to these redeterminations (Pub. L. 104-193, section 212(b); section 1614(a)(3)(H)(iii) of the Act).

• We must conduct a CDR not later than 12 months after the birth of the child for any child whose low birth weight is a contributing factor material to our determination that the child was disabled (Pub. L. 104-193, section 212(c); section 1614(a)(3)(H)(iv) of the Act).

• At the time of a CDR, a child's representative payee must present evidence that the child is and has been receiving treatment to the extent considered medically necessary and available for the disabling impairment. If a payee refuses without good cause to provide such evidence, we may select another representative payee, or pay benefits directly to the child, if we determine that it is appropriate and in the best interests of the child (Pub. L. 104-193, section 212(a); section 1614(a)(3)(H)(ii) of the Act).

The Interim Final Rules

The interim final rules we published on February 11, 1997, implemented all of the provisions of sections 211 and 212 of Pub. L. 104-193, except section 211(d)(2).

See

62 FR 6408; corrected at 62 FR 13537, March 21, 1997, and 62 FR 36460, July 8, 1997. Section 211(d)(2) required us to redetermine the eligibility of children who might be affected by the change in law, and did not require regulations. In brief, we deleted references to the former standard of “comparable severity” to adults and deleted the IFA regulations and all references to the IFA in other regulations. We deleted references to “maladaptive behaviors” and related references in the sections of our regulations and the Listing of Impairments cited in Pub. L. 104-193. We also made other changes in our rules that were necessary because of these revisions.

In §§ 416.902 and 416.906 of the interim final rules, we explained that, to be found disabled, an individual under age 18 must have “marked and severe functional limitations.” In § 416.902, we explained that the term “marked and severe functional limitations,” when used as a phrase, means the standard of disability in the Act for children claiming SSI benefits. This standard of disability requires a level of severity that meets, medically equals, or functionally equals the severity of an impairment(s) in the listings;

i.e.

, is of listing-level severity. We explained that the separate words “marked” and “severe” are also terms used throughout our rules, but the meanings of these words in the phrase “marked and severe functional limitations” are not the same as their meanings when used separately.

Other significant changes made by the interim final rules included the following:

• We revised § 416.924, “How we determine disability for children,” to reflect the changes made by Pub. L. 104-193 and to establish a new sequential evaluation process for determining disability for children. The new three-step process required a child who was not working to show that he or she had a “severe” impairment or combination of impairments that met, medically equaled, or functionally equaled the severity of an impairment(s) in the listings.

• In new § 416.924(g) we referred to a Childhood Disability Evaluation Form, Form SSA-538, which we issued in conjunction with the interim final rules. Section 416.924(g) required our adjudicators (except disability hearing officers) at the initial and reconsideration levels of our administrative review process to complete an SSA-538 to show their findings in each case. We also explained that disability hearing officers, administrative law judges, and administrative appeals judges on the Appeals Council (when the Appeals Council makes a decision) will not complete the form but will indicate their findings at each step in the sequential evaluation process in their determinations or decisions.

• We revised § 416.925(b)(2), which explains the purpose of the childhood listings in part B of the listings, to explain that “listing-level severity” generally means marked limitations in two broad areas of functioning or extreme limitation in one such area.

• We revised § 416.926 to provide rules for determining medical equivalence for both adults and children. Our prior rules had addressed medical equivalence for children separately, in § 416.926a. We also incorporated in § 416.926 of the interim final rules language from prior § 416.926a and our operating instructions to clarify the rules. We also intended the changes to be consistent with our rules in § 404.1526 (the rule for disability claims under title II of the Act), which we did not change in the interim final rules.

• We published revised and expanded guidelines for determining functional equivalence to the listings in § 416.926a. The interim final rules continued to provide four methods for determining functional equivalence, and the primary method continued to be evaluating whether a child had marked limitations in two broad areas of development or functioning or extreme limitation in one area. We also added a new area, called “motor development” or “motor functioning,” to help our adjudicators better evaluate physical impairments. We also retained our requirement that a finding of functional equivalence must be related to a particular listing. Generally, we used a childhood mental disorders listing to make this finding. However, adjudicators could use any listing that included disabling functional limitations among its criteria.

In publishing the improved functional equivalence rules, we noted that even though Congress eliminated the IFA, it directed us to continue to evaluate a child's functional limitations where appropriate, although using a higher level of severity than under the former IFA. Congress also explicitly endorsed our functional equivalence policy as a means to evaluate impairments that would not meet or medically equal any listings and without which some needy children with severe disabilities would not be found eligible. (62 FR 6413)

• We revised the rules in §§ 416.990 and 416.994a relating to CDRs of children to reflect the changes in the frequency of CDRs. The changes we made to these rules included requiring CDRs for children who qualified because of low birth weight, and making conforming changes to reflect the definition of disability for children in Pub. L. 104-193.

• We published a new § 416.987 to provide rules for redetermining the eligibility of individuals who attain age 18 and who were eligible for SSI based on disability in the month before the month in which they attained age 18. The section included a rule that we would not count an individual's earnings when we determine disability under this section. It also provided rules for notifying individuals who will have these redeterminations.

• We revised §§ 416.635 and 416.994a of our rules to include the statutory requirement that, at the time of a CDR, a child's representative payee must present evidence that the child is and has been receiving treatment that is considered medically necessary and available for the disabling impairment(s). We also explained how we would determine whether and how treatment was medically necessary and available.

We made many other changes to conform our rules to the major changes noted above. We also expanded and clarified several rules, including sections in the listings, and defined terms related to the new regulations. For a complete description of the changes in the interim final rules and our reasons for making them, interested readers may refer to the preamble to the interim final rules.

The Balanced Budget Act of 1997 (Pub. L. 105-33)

Pub. L. 105-33, 111 Stat. 251, enacted on August 5, 1997, contained two provisions that affect these final rules, and other provisions that affected the redeterminations and protected the Medicaid eligibility of children who lost SSI eligibility because of the new disability standard.

The amendments affecting these final rules provided the following:

• Pub. L. 104-193 required us to perform a redetermination of a beneficiary's eligibility within 1 year after the individual turns 18. Pub. L. 105-33 changed this requirement and provided that we may perform this redetermination either during the 1-year period beginning on the individual's 18th birthday, or in lieu of a CDR whenever we determine that the individual's case is subject to a redetermination (Pub. L. 105-33, section 5522(a)(1); section 1614(a)(3)(H)(iii) of the Act).

• Pub. L. 104-193 required us to do a CDR not later than 12 months after the birth of a child for whom low birth weight is a contributing factor material to our determination of disability. Pub. L. 105-33 changed this provision to provide that we do not have to do a CDR by age 1 if we determine at the time of our initial disability determination that the child's impairment(s) is not expected to improve by age 1, and we schedule a CDR for a time after the child turns age 1 (Pub. L. 105-33, section 5522(a)(2)(B); section 1614(a)(3)(H)(iv)(VI) of the Act).

Pub. L. 105-33 also extended the deadline for redetermining the eligibility of children who might be affected by the new disability standard. Pub. L. 104-193 required us to perform redeterminations within 1 year after enactment of the law, or by August 22, 1997. Section 5101 of Pub. L. 105-33 extended that date by an additional 6 months, to February 22, 1998. For any redetermination not performed by that date, the law also allowed us to perform the redeterminations “as soon as practicable thereafter.” Because we do not have regulations addressing this redetermination process, this provision of Pub. L. 105-33 does not affect these final rules.

Finally, section 4913 of Pub. L. 105-33 required States to continue Medicaid coverage for disabled children who were receiving SSI as of the enactment date of Pub. L. 104-193 if they lost SSI eligibility because of the changes to the definition of disability. The authority for making the determination about restored or continued Medicaid eligibility remains with the States, so this change in the law also does not affect these final rules.

Actions Since We Published the Interim Final Rules

Many of the public comments, most of which were submitted during the first half of 1997, expressed concerns about how we would conduct the required redeterminations of the eligibility of children who qualified under the old disability standard. Many commenters expressed concerns that the law required us to do the redeterminations too quickly and that the new rules were unfamiliar to our adjudicators. Some commenters were concerned that we would not get proper evidence. They were especially concerned that we would not get sufficient evidence from schools because we would conduct many redeterminations in the summer. We also received allegations that the State agencies were purchasing substandard consultative examinations and using them to cease children's eligibility.

Some commenters expressed concern that children and their families would not understand that they could appeal determinations that they were no longer eligible and that they could continue to receive benefits while appealing. Some were concerned about how the redeterminations and loss of benefits would affect children and their families in the future.

In response to these and other concerns, Commissioner Kenneth Apfel promised, during his confirmation hearings before the Senate Finance Committee in 1997, to perform a “top-to-bottom” review of how we implemented the changes made to the SSI childhood disability program that were required by Pub. L. 104-193. He ordered this review as his first official act after being confirmed as Commissioner, and we issued a report, Review of SSA's Implementation of New SSI Childhood Disability Legislation, on December 17, 1997. (Pub. No. 64-070. The report is also available at our public Internet site: www.ssa.gov/policy/child.htm.)

The report showed that, overall, the vast majority of the redeterminations were handled properly. The review indicated that SSA and the State agencies making disability determinations for us had done a good job of implementing the new provisions, but found some inconsistencies in the application of the rules and in compliance with our instructions. Commissioner Apfel immediately ordered several corrective actions to address these issues.

In the report, we identified three specific areas of concern, and the corrective actions we would take above and beyond our normal actions:

1. Children Classified in Our Records as Having Mental Retardation

Of the approximately one million children on the SSI rolls in December 1996, 407,000 were shown on our records with our diagnosis code for mental retardation. Eighty percent of these children were not subject to redetermination under Pub. L. 104-193. However, at the time of the report, we had found ineligible under the new law slightly more than half of the approximately 79,500 children whose eligibility we reviewed and who were coded in our computer records as having mental retardation. Our review concluded that part of this could be attributed to the fact that, historically, some children were coded using the

diagnosis code for mental retardation incorrectly or because we did not have a diagnosis code for the child's impairment. Over half of the cases in which benefits had been ceased involved children who were not diagnosed with mental retardation at the time of the cessation. Of these cases, almost 40 percent involved a learning disability and others involved borderline intellectual functioning. Thus, in a large number of cases with the diagnosis code for mental retardation, the children did not have mental retardation, were never thought to have mental retardation, but were shown in our records with that diagnosis code.

However, our review also showed concerns about the accuracy of these redeterminations, especially for children with IQs in the range of 60 to 70 and slightly above 70. The concerns included whether listings were misapplied and whether children with mental retardation who had IQ scores above 70 incorrectly lost eligibility.

To address the concerns, we reviewed the cases of all children who had a diagnosis code for mental retardation if we had found they were ineligible after a redetermination or if we had denied their initial applications on or after August 22, 1996. We automatically reopened and issued new determinations in the cases of all children who were coded as having mental retardation and who had an IQ score of 75 or below. We also provided additional training to all of our adjudicators on how to evaluate claims involving children with mental retardation under the new rules, before they reviewed the cases again.

2. Quality of Case Processing

We found that the concerns about sufficient case development were unfounded, especially the concerns that we would not get school records we needed and that our consultative examinations were inadequate. However, we did find some issues related to the quality of case processing.

In some States, we found problems in cases that were ceased based on a “failure to cooperate.” Our procedures require additional attempts to contact a child's parent or legal guardian when this individual does not respond to official notices regarding the child's eligibility. Our procedures also require us to make special efforts to identify and contact another adult or agency responsible for the child's care. We also require written documentation of those attempts. We determined that in some cases all required contacts were not attempted or they were not documented in the case file. Therefore, we reviewed all “failure to cooperate” cessations to ensure that proper procedures were followed. When those reviews indicated deficiencies, we gave families another opportunity to cooperate and to have their benefits reinstated during the new redetermination process, including any benefits that would have been paid since the month when payments ceased. We also provided additional written instructions and training on this issue to our personnel.

We also found that, although the accuracy of the redeterminations was above the regulatory threshold for accuracy nationally, it varied by State and by type of impairment, particularly for certain mental disorders other than mental retardation. Therefore, we instructed all of our State agencies to review a portion of the cases they had ceased on redetermination. Depending on the quality assurance results in each State, we identified cases involving both physical and mental impairments (other than mental retardation) for review based on the cases that had the greatest likelihood of error within a given State. When we found deficiencies in a redetermination, the case was reopened, developed if necessary, and the determination revised if appropriate.

Before these reviews began, we provided additional training to all our adjudicators on how to evaluate mental impairments other than mental retardation and on the evaluation of speech disorders in combination with cognitive limitations. We also issued Social Security Ruling (SSR) 98-1p, on the evaluation of speech disorders in combination with cognitive limitations. (63 FR 15248 (1998))

3. Appeals and Requests for Benefit Continuation During Appeal

When we notified families (or other payees) that a redetermination found that a child no longer qualified, the notice also advised them of their legal rights. This information included:

• How to ask for a reconsideration,

• How to request continuation of benefit payments while appealing, and

• How to obtain legal assistance to appeal.

Concerns were raised that the cessation notice was hard to understand. We also received reports that some families were discouraged from filing appeals or were not told about free legal services. We received reports that some families were discouraged from asking for benefit continuation during their appeals, especially because the overpayment waiver process was not fully explained to them. Some families did not understand that they might not have to pay back the benefits they received during the appeal if the appeal decision was still unfavorable.

We made changes to clarify our procedures and provided training as the redeterminations proceeded. However, we found that these actions helped only those children whose cases were redetermined later in the process and that some individuals who did not appeal—and some who appealed, but did not request benefit continuation—did not understand their rights.

To address this concern, on February 18, 1998, we sent a new notice using simpler language to families (or other payees) of all children who lost their SSI eligibility under the new childhood disability rules and did not appeal. The notice gave them another chance to appeal and to ask for benefit continuation during the appeal. We also sent a new, simpler notice to families (or other payees) of all children who had appealed their initial redeterminations but who did not request benefit continuation during the appeals. The notice gave them another chance to request benefit continuation during the appeal. Both notices included information on the right to request waiver of any overpayment that might result from continuing benefits during appeal and on how to get free legal assistance.

On March 18, 1998, we also sent new, simpler notices to individuals who had attained age 18 and who lost their eligibility because of the changes in Pub. L. 104-193. We sent these notices to individuals who did not appeal or who appealed but did not request benefit continuation during their appeal.

We also took several other actions. For example, we provided a “script” for employees in our Field Offices and Teleservice Centers to follow when informing claimants of their appeal and benefit continuation rights. The script ensured that all families received the same information. We also made concerted efforts to ensure that families knew about available legal assistance by providing toll-free numbers for the American Bar Association's (ABA's) Children's SSI Project referral service in our Field Offices, Teleservice Centers, and on our Internet site. We also included the ABA's toll-free numbers for legal assistance on our notices for States in which toll-free numbers were available.

In addition to the corrective actions outlined above, we have taken many other actions. For example, we continue to monitor case quality through our quality assurance system. We conducted

several training classes in addition to those noted above and trained a “cadre” of specialists in childhood disability who served as experts in their respective regions. We are now studying several issues related to childhood disability, which we describe in the public comments section of this preamble, including the effects on families of the loss of eligibility resulting from Pub. L. 104-193.

These final childhood rules represent another step in our actions to ensure that all children who meet the SSI eligibility requirements receive their benefits. The final rules respond to extensive comments on the interim final rules that we received from a wide range of child-serving professional organizations as well as advocacy, legal, and family groups and individuals. Their comments, together with our experience, input from individual medical and other professionals, and other actions, support the adjustments made in the interim final regulations that we publish today as the final childhood disability regulations.

Explanation of the Effective Date

As we noted in the effective date section of this preamble, these final rules will be effective on January 2, 2001. We have delayed the effective date of the rules to give us time to provide training and instructions to all of our adjudicators and to revise Form SSA-538 and other forms and notices before we implement the final rules. The interim final rules will continue to apply until the effective date of these final rules. When the final rules become effective, we will apply them to new applications filed on or after the effective date of the rules. We will also apply them to the entire period at issue for claims that are pending at any stage of our administrative review process, including claims that are pending administrative review after remand from a Federal court.

With respect to claims in which we have made a final decision, and that are pending judicial review in Federal court, we expect that the court's review of the Commissioner's final decision would be made in accordance with the rules in effect at the time of the final decision. If the court determines that the Commissioner's final decision is not supported by substantial evidence, or contains an error of law, we would expect that the court would reverse the final decision, and remand the case for further administrative proceedings pursuant to the fourth sentence of section 205(g) of the Act, except in those few instances where the court determines that it is appropriate to reverse the final decision and award benefits, without remanding the case for further administrative proceedings. In those cases decided by a court after the effective date of the rules, where the court reverses the Commissioner's final decision and remands the case for further administrative proceedings, on remand, we will apply the provisions of these final rules to the entire period at issue in the claim.

Summary of Final Rules

We are adopting the interim final rules with the changes set out below, and are publishing only those rules that we have changed. For a summary of the rules we are adopting without change, see the 1997 interim final rules (62 FR 6408).

For clarity, we refer to the changes we are making here as “final” rules and to the rules that will be changed by these final rules as the “interim final” rules. We also use the past tense to describe the interim final rules we are changing. However, it must be remembered that these final rules do not go into effect until January 2, 2001. Therefore, the interim final rules will still be in effect until that date.

Changes to § 416.902 General Definitions and Terms for This Subpart

We are adding a new definition to this section to help simplify the language of our regulations. We define the term “the listings” to mean the Listing of Impairments in appendix 1 of subpart P of part 404 of this chapter. Throughout these final rules, we use the new term in the phrase “medically or functionally equals the listings” to replace longer phrases that refer to appendix 1 of subpart P of part 404 of this chapter. For example, when we say that we consider whether an impairment(s) medically or functionally “equals the listings” we mean “whether an impairment medically or functionally equals in severity the criteria of a listing in appendix 1 of subpart P of part 404 of this chapter.”

We are making this change because of changes we are making in the functional equivalence provisions of the regulations in response to public comments. As we explain more fully under the explanation of changes to final § 416.926a, we will no longer refer to specific listings when we determine functional equivalence. The change also simplifies the language of our rules and removes some inconsistencies among various rules.

We are also including in our current definition of the words “you” or “your” the words “me,” “my” and “I.” Under the President's plain language initiative, we are changing some of our rules to use first-person questions in paragraph and section headings. We used this technique in final § 416.987(c), using a question and the pronoun “my” in the heading, “When will my eligibility be redetermined?” and in final § 416.987(d), using the pronoun “I” in the heading, “Will I be notified?” Therefore, we need to add a definition of these words in § 416.902. In anticipation of similar future changes, we are also indicating that we may use the word “me.” The new terms, which are only editorial, help clarify our rules.

Changes to § 416.924 How We Determine Disability for Children

In final § 416.924(c), we are adding language to clarify that at step two of the sequential evaluation process we consider both whether a child has a medically determinable impairment and whether any impairment or combination of impairments the child has is “severe.” In the interim final rules, we did not include the first part of the statement.

The new language only clarifies our rules and helps to make them consistent with changes we made in final §§ 416.924a and 416.926a in response to public comments. It is based on our interpretation of step two of the sequential evaluation processes for both adults and children, as explained in SSR 96-4p. (61 FR 34488 (1996))

In response to public comments that suggested we include more cross-references in our regulations, we changed § 416.924(d)(3) of the interim final rules, to final § 416.924(e), “Other rules.” Section 416.924(d)(3) of the interim final rules provided cross-references to our rules on meeting, medically equaling, and functionally equaling the listings. Final § 416.924(e) now adds cross-references to final §§ 416.924a, 416.924b, and 416.929 in addition to cross-referencing the rules on meeting and medically or functionally equaling the listings. The last of the new cross-references is to our rules for the evaluation of pain and other symptoms.

Because of this change, we redesignated paragraph (e) of the interim final rules, “If you attain age 18 after you file your disability application but before we make a determination or decision,” as paragraph (f). As we explain below in our explanation of the changes in final § 416.924a, we moved the provisions of § 416.924(f) of the interim final rules, “Basic considerations,” to final § 416.924a(a).

We have not changed § 416.924(g) of the interim final rules, “How we will explain our findings.” Therefore, we are

not reprinting it in this

Federal Register

notice. However, by the time these rules become effective, we will issue a revised Form SSA-538, Childhood Disability Evaluation Form, to reflect the changes in these final rules. (See the public comments section of this preamble for more information about Form SSA-538.) We also changed some of the language throughout § 416.924 for consistency;

e.g.

, to refer to impairments that “equal the listings.”

General Changes in Final §§ 416.924a and 416.924b

In the final rules, we extensively reorganized and revised the provisions of the interim final rules in §§ 416.924a, “Age as a factor of evaluation in childhood disability,” 416.924b, “Functioning in children,” and 416.924c, “Other factors we will consider,” and some of the provisions of § 416.926a, “Functional equivalence for children.” These changes respond to many of the public comments, many of which affected more than one section of our rules.

We are replacing §§ 416.924a, 416.924b, and 416.924c of the interim final rules with final §§ 416.924a, “Considerations in determining disability for children,” and 416.924b “Age as a factor of evaluation in the sequential evaluation process for children.” For the most part, the final rules include the provisions of the interim final rules. However, in reorganizing the provisions, we found a number of redundancies that we eliminated and text we could combine and shorten. We also simplified much of the language and expanded some of our guidance, as suggested by the commenters. We also deleted some sections that we no longer need because of the revisions.

We made these changes because many public commenters recommended that we provide a better explanation of how our provisions on “other factors” in § 416.924c of the interim final rules apply in evaluating childhood disability. Many commenters urged us to clarify these rules and to provide more guidance about how we apply the factors when we evaluate a child's functioning. Many commenters also suggested that we include more factors for our adjudicators to consider when they evaluate a child's functioning. Some commenters urged us to incorporate information from our operating manuals and training, and to give more prominence to these important principles so that they are not overlooked. Others asked us to add cross-references throughout the childhood disability regulations so that no relevant provisions are overlooked.

In final § 416.924a, we no longer refer to the factors as “other” factors because the comment letters showed that our intent was not clear. Our intent in the interim final rules was only to include guidance about some of the more important factors we consider when we evaluate a child's functioning to decide whether the child has a “severe” impairment and whether the child's impairment(s) meets or equals the listings. But our earlier wording led people to believe that we meant to consider the “other factors” separately, after an initial assessment of a child's functioning, to see whether there are additional limitations the child might have based on the “other factors.” That has never been our intent. Like our consideration of symptoms, the factors in this rule are an integral part of our evaluation of a child's functioning.

To demonstrate our intent more clearly, and to give the provisions the prominence the public commenters thought was lacking, we moved up the provisions of § 416.924c of the interim final rules. Now, the provisions on factors we consider when we assess functioning are found in final § 416.924a instead of last in the series of childhood regulations beginning with § 416.924.

In the next section of this preamble, we explain the specific changes we made in final §§ 416.924a and 416.924b and our reasons for making them.

Specific Changes in § 416.924a Considerations in Determining Disability for Children

Final § 416.924a(a) contains the provisions of §§ 416.924(f), “Basic considerations,” and 416.924c(a), “General,” of the interim final rules. We clarified the language of the interim final rules and removed redundancies. We also added some examples of medical sources to correspond to the existing examples of nonmedical sources, and included more examples of nonmedical sources whom we may ask for information.

The term, “Other medical sources not listed in § 416.913(a),” which now appears in final § 416.924a(a), refers to medical professionals who are not “acceptable medical sources.” It is taken from a revision to § 416.913(d) (formerly § 416.913(e)) we published in the

Federal Register

on June 1, 2000 (65 FR 34950). In those final rules, we also recognize qualified speech-language pathologists and certain other specialists as acceptable medical sources for evidence of impairments that are within their areas of specialty.

In final § 416.924a(a)(1), we also included a cross-reference to our rules in § 416.927, in response to comments that asked us to include more cross-references to provisions our adjudicators must consider before making their determinations or decisions. That section explains how we consider medical source opinion.

We added a new provision about testing in final § 416.924a(a)(1)(ii) to respond to comments recommending that we caution our adjudicators against strict adherence to the numerical scores of IQ tests and other tests. The new provision restates our longstanding policy that we consider all relevant evidence in a child's case record. Therefore, we do not consider any piece of evidence in isolation, including test scores, and will not rely on test scores alone when we decide if a child is disabled. The provision is also in part a response to comments that recommended revising the rules to include consideration of the standard error of measurement (SEM) that professionals use to estimate a score's reliability. The provision includes in our rules information we have included in our training since 1997. (We explain more about the SEM in the summary of final § 416.926a and in our responses to the comments.) We also added a cross-reference to § 416.926a(e), which includes several provisions on how we consider test scores, especially in final § 416.926a(e)(4).

The last sentence of final § 416.924a(a)(1)(iii), “Medical sources,” is new in our regulations but reflects our longstanding procedure. It explains that we may consider information provided by a nonmedical source (e.g., a parent or the child) to be a clinical sign, as defined in § 416.928(b), when the medical source has accepted and relied on it to reach a diagnosis. This often occurs for children with mental disorders, when a psychiatrist or psychologist may accept statements made by the child or parents, such as “my child has difficulty sleeping,” as his or her clinical findings. However, it may also occur for children who have other kinds of impairments.

In final § 416.924a(a)(2), “Information from other people,” we expanded the guidance we gave in § 416.924(f) of the interim final rules. We added new guidance about information we will request from early intervention and preschool programs, and provide more guidance about the information we will request from schools.

Final § 416.924a(b), “Factors we consider when we evaluate the effects of your impairment(s) on your functioning,” incorporates the

provisions of §§ 416.924c(b) through (h) of the interim final rules; i.e., what we formerly called the “other factors.” In response to public comments, we expanded the list of factors we will consider and incorporated principles from our training and other instructions we have used since we published the interim final rules in 1997.

In final § 416.924a(b)(1), “General,” we explain that we must consider a child's functioning when we decide whether the child has a “severe” impairment(s) at step two of the sequential evaluation process and when we consider functional equivalence at step three. We also explain that we will consider a child's functioning when we decide whether his or her impairment(s) meets or medically equals the requirements of a listing if the listing we are considering includes functioning among its criteria.

In final § 416.924a(b)(2), “Factors we consider when we evaluate your functioning,” we explain that we will consider any factors that are relevant to how the child functions when we evaluate his or her impairment or combination of impairments. In response to many commenters who thought we should include a reference to pain and other symptoms in this section, we added an example of symptoms and provided a cross-reference to our rules on evaluating symptoms in § 416.929. We also clarified that the factors we list in the remainder of the section are only “some” of the factors we may consider.

Final § 416.924a(b)(3), “How your functioning compares to the functioning of children your age who do not have impairments,” is new in this section, although it reflects our longstanding policy. It explains that when we consider whether a child has functional limitations because of his or her impairment(s), we will consider the child's functioning in age-appropriate terms;

i.e.

, in relation to other children of the same age who do not have impairments.

In final § 416.924a(b)(3)(ii), we added a corollary to this principle. When we consider evidence that formally or informally rates a child's functioning, we will consider the standards used by the person who did the rating and the characteristics of the group to whom the child was compared. We include the familiar example from our training and instructions that a child in a special education class who is compared to other children in the class is not being compared to children of the same age who do not have impairments.

Final § 416.924a(b)(4) is also new. It specifies in the context of our childhood disability rules our longstanding policy that, when a child has more than one impairment (

i.e.

, multiple impairments), we consider the combined effects of the impairments. We have had a rule on this issue (§ 416.923) for many years, and specific provisions in the interim final rules that addressed the point (

e.g.

, §§ 416.924(a), 416.924(c), 416.924b(a), and 416.926a(a)). The new provision is one of our responses to those comments that asked us to explain better how we consider “multiple” impairments. This provision is intended to recognize that limitations resulting from a combination of impairments may be greater than the limitations that we might expect to find if we looked separately at each impairment;

i.e.

, the impairments may have interactive and cumulative effects. We also use the word “comprehensively” to emphasize that we look at all of these effects when we evaluate the child's functioning.

However, we also explain in the first sentence that we do not always need to look at the combined effects of a child's multiple impairments. Sometimes we can decide that any single impairment is “severe” or that one of a child's impairments meets, medically equals, or functionally equals the listings without considering the child's other impairments.

Final § 416.924a(b)(5), “How well you can initiate, sustain, and complete your activities, including the amount of help or adaptations you need and the effects of structured or supportive settings,” incorporates provisions from several interim final rules and includes new provisions that respond to public comments. Final § 416.924a(b)(5)(i), “Initiating, sustaining, and completing activities,” incorporates principles from the “Concentration, persistence or pace” area of functioning in § 416.926a of the interim final rules. The principle that a child should be able to initiate, sustain, and complete activities independently and at the same rate as other children his or her age who do not have impairments is inherent in all evaluations of functioning.

We clarify this principle further in final § 416.924a(b)(5)(ii), “Extra help,” which expands on the guidance we provided in the last sentence of § 416.926a(c)(2) of the interim final rules. We incorporated this guidance in final § 416.924a because it is appropriate whenever we must evaluate a child's functioning, not just at the functional equivalence step.

In the final provision, we explain that an important indication of the severity of a child's impairment(s) and its resulting limitations is the amount of effort that must be made to help the child function. By “help,” we mean not only help from parents, medical providers, school personnel, or other people, but also the “help” a child may get from special equipment, devices, or medications in order to complete his or her tasks. We may decide that a child has limitations compared to other children the same age who do not have impairments because of extraordinary efforts that must be made for the child to function as well as he or she does.

Final § 416.924a(5)(iii), “Adaptations,” incorporates the provisions of § 416.924c(e) of the interim final rules. We clarified some of the earlier language and reinforced the requirement that we compare a child's functioning to the typical functioning of children the same age who do not have impairments.

We also deleted two examples. We deleted the word “appliances” from the previous second sentence because it is included in the concept of “assistive devices” that appears in the same sentence. We also deleted the “hearing aids” example from the third sentence. Hearing aids are not a good example of an adaptation that may allow a child to function normally because they do not restore normal hearing the way eyeglasses may restore essentially normal vision.

Final § 416.924a(b)(3)(iv), “Structured or supportive settings,” corresponds to § 416.924c(d) of the interim final rules, “Effects of structured or highly supportive settings.” We deleted the word “highly” because we are clarifying that we consider how a child functions in all settings compared to the typical functioning of same-age children who do not have impairments. The basic principles that apply to the evaluation of functioning in “highly” supportive settings also apply to the evaluation of a child's functioning in other supportive settings.

We also made a number of editorial changes for clarity, added several examples, and expanded some statements from the interim final rules to better explain our intent.

Final § 416.924a(b)(6), “Unusual settings,” is new. It includes in our rules our longstanding policy that a child's functioning in an unusual situation, such as a consultative examination or a one-to-one setting, may not be typical of his or her functioning in routine settings on a day-to-day basis. It is another example of our policy that we do not consider any single piece of evidence in isolation from the other relevant evidence in the case record.

We added this section because some commenters noted correctly that there are medical impairments (such as

attention deficit hyperactivity disorder) that may not be as manifest in unusual settings as they are in typical settings, such as at home and in school. A child with such an impairment may appear to be relatively normal in an unusual setting but be very limited in others. Other impairments can be more or less severe at any given point in time, so that a child may appear more or less limited on any single examination or in any one-to-one or other unusual setting. We included this principle in our training after we implemented the interim final rules, so the new provision only reflects our existing policy.

Final § 416.924a(b)(7), “Early intervention and school programs,” incorporates, expands, and clarifies provisions of § 416.924c(g) of the interim final rules. To respond to comments requesting more explanation of how other factors apply when we evaluate a child's limitations, we added more discussion about how we consider evidence from early intervention services, preschools, and schools. We also provide specific guidance about how we use school records (subparagraph (ii) of the final rule) and how we consider assessments from early intervention services or special education programs or accommodations in school (subparagraphs (iii) and (iv) of the final rule).

We also made clear in this section, and throughout the rules, that “school” includes preschool. We also explain better (in subparagraph (v) of the final rule) how the impact of chronic or episodic impairments or a child's need for therapy or treatment may interfere with his or her ability to participate in school activities.

Final § 416.924a(b)(8), “The impact of chronic illness and limitations that interfere with your activities over time,” incorporates the relevant provisions of § 416.924c(b), “Chronic illness,” from the interim final rules. Much of interim final § 416.924c(b) addressed the effects of treatment as it related to chronic illness and was not specifically relevant to this heading. Therefore, we moved those provisions into the section on treatment, final § 416.924a(b)(9). In response to a comment, we also added new second and third sentences in the paragraph to explain better the importance of considering functioning over time when a child has a chronic impairment that is characterized by episodes of exacerbation (worsening) and remission (improvement). For these new sentences, we adopted language we use in the third paragraph of section 12.00D of the adult mental disorders listings. This principle is equally applicable to children and adults, and to both physical and mental impairments.

Final § 416.924a(b)(9), “The effects of treatment (including medications and other treatment),” incorporates the provisions of paragraphs (c) (“Effects of medication”), (f) (“Time spent in therapy”), and (h) (“Treatment and intervention, in general”) of § 416.924c of the interim final rules. We expanded the list of factors we will consider when we evaluate the effects of a child's medications. We deleted the reference to “marked and severe functional limitations” that was in the third sentence of interim final § 416.924c(c) to clarify that the factors in § 416.924a apply when we evaluate a child's functioning beginning at step two of the sequential evaluation process. We also clarified language and added examples and new language reinforcing some of the principles discussed above.

Specific Changes in Final § 416.924b Age as a Factor of Evaluation in the Sequential Evaluation Process for Children

As already noted, we redesignated § 416.924a from the interim final rules as final § 416.924b. We revised the heading of the section to make clearer that it addresses the consideration of age at steps two and three of the sequential evaluation process for children.

Except for editorial changes and one addition, final § 416.924b(a), “General,” is the same as § 416.924a(a) of the interim final rules. We expanded the provision on children who may be too young to be tested, now in final § 416.924b(a)(4), with language we adopted from section 114.00D4 of the listings. The new language explains that we will consider all relevant information in the child's case record, including “other generally acceptable methods consistent with the prevailing state of medical knowledge and clinical practice that will help us evaluate the existence and severity” of the child's impairment(s). This is not a policy change since it only clarifies what we do in all cases, including for infants and toddlers.

Final § 416.924b(b), “Correcting chronological age of premature infants,” is identical to § 416.924a(b) of the interim final rules. For that reason, we are not reprinting it in the

Federal Register

.

We are deleting all of § 416.924a(c) of the interim final rules, primarily because these provisions are better addressed elsewhere in these final rules. For example, the provisions of § 416.924a(c)(1) of the interim final rules, which address how a child adapts to an impairment, are better addressed by several provisions in final § 416.924a, as already explained above, and § 416.926a. The principles in § 416.924a(c)(3)(ii) of the interim final rules, which explained the interactive and interdependent process of development within a child, are better addressed by final § 416.926a(c), “The interactive and cumulative effects of an impairment or multiple impairments,” and throughout the general and age-specific descriptions of each domain in final § 416.926a. Likewise, using work-related activities to measure functioning in adolescents is now addressed by the age-specific domain descriptors found in § 416.926a.

We deleted some provisions for consistency. The final rules emphasize our longstanding policy that we consider the specific effects of each child's impairment(s) on his or her functioning based on the evidence in the case record. Some provisions in § 416.924a(c) of the interim final rules, however, provided more general guidance about how impairments might theoretically affect children who were older or younger. We originally included this guidance in our rules in 1991 when we first instituted the functional equivalence and IFA policies because we thought it would help our adjudicators better understand how impairments might affect children at different ages. However, we believe that we no longer need such guidance in our rules and that our focus on the need to assess the specific limitations each child has regardless of age is clearer without it.

Deletion of § 416.924b of the Interim Final Rules

Because of the changes we made in final §§ 416.924a and 416.924b, and in final § 416.926a, as described below, we deleted all of § 416.924b of the interim final rules, “Functioning in children.” Section 416.924b(a), “General,” merely restated the principle that we consider all of a child's limitations when we evaluate whether the child has a “severe” impairment and whether the impairment causes “marked and severe functional limitations.” Since we make identical and similar statements repeatedly throughout the final rules, it was unnecessary to retain this statement.

Section 416.924b(b) of the interim final rules, “Terms used to describe functioning,” included definitions of the terms “age-appropriate activities,” “developmental milestones,” “activities of daily living,” and “work-related activities.” However, we used the term “work-related activities” only in § 416.924a(c)(4) of the interim final

rules. We did not use the other terms at all in the interim final rules, although we used the phrase “age-appropriate” and the word “development” in § 416.926a to describe the method of functional equivalence based on “broad areas of functioning.” We believe the changes we made throughout the final rules to indicate that we consider a child's functioning in relation to children of “the same age who do not have impairments” adequately cover the idea we intended by the term “age-appropriate activities.” Likewise, final § 416.926a continues to refer to a child's “development” and incorporates appropriate principles with examples for each age category. As already noted, we also included examples of work and work-related activities in the sections describing the domains for adolescents in final § 416.926a.

Changes to § 416.925 Listing of Impairments in Appendix 1 of Subpart P of Part 404 of This Chapter

We revised § 416.925(b)(2) of the interim final rules to make it consistent with other changes we made in these final rules, especially changes in final § 416.926a. As we explain below when describing the changes to the functional equivalence rules, we will no longer refer to specific listings when we consider whether an impairment functionally equals the listings. In keeping with this change, we removed the reference to the childhood mental disorders listings in our definition of “listing-level severity” in final §§ 416.925 and 416.926a. We also updated the references to include the new domains described below and provided a better cross-reference to the rules defining the terms “marked” and “extreme.”

Changes to § 416.926a Functional Equivalence for Children

We received many comments about our functional equivalence rules. Most commenters raised at least one of the following issues:

• Many commenters said that our rules on functional equivalence were too complicated and suggested that we simplify them. Some commenters noted that it was difficult for adjudicators to determine which listings contained “disabling functional limitations.”

• Most commenters focused on the method of functional equivalence that was based on “broad areas of development or functioning,” set out in § 416.926a(c) of the interim final rules. Some of these commenters noted that we did not provide the same number of areas of functioning for all children and thought that this was unfair to children who had fewer functional areas in which to be rated. These commenters pointed out that for children age 1 to 3 we provided only three areas of functioning, while for older children we provided five.

• Many commenters asked us to separate communication from cognition in the cognitive/communicative area of functioning.

• Many commenters asked us to provide better ways to evaluate physical impairments. Many of these commenters suggested that we include another area of functioning to evaluate physical disorders in addition to the “motor” domain we added in 1997.

• Many commenters also asked us to clarify the rules to explain more clearly how we evaluate combinations of impairments, particular kinds of impairments, and particular kinds of functional limitations.

• A number of commenters asked us to clarify how we consider the results of testing, including the SEM, and how we define the terms “marked” and “extreme.”

For a more detailed summary, see the public comments section of this preamble. As we note there, we adopted or partially adopted these comments in the final rules. In many cases, we incorporated specific suggestions made by commenters.

Final § 416.926a has the following key features:

•

Simplified rules.

Under the interim final rules, we provided four methods for evaluating functional equivalence. (

See

§§ 416.926a(b)(1)-(b)(4) of the interim final rules.) In the final rules, we are providing a single method, based only on domains of functioning. The methods were somewhat redundant and, by far, the most commonly used one was based on broad areas of development or functioning, which we call “domains” in the final rules. The word “domain” is consistent with the language used in the conference report on the legislation, and much simpler than the phrase we used in the interim final rules, which meant the same thing.

•

Delinking from specific listings.

We also simplified the final rules so that adjudicators will no longer consider or refer to any of the listings when deciding functional equivalence. Although we provided self-contained domain criteria under the “broad areas of development or functioning” method in the interim final rules, we still required reference to listing 112.02 or 112.12 when a child's impairment(s) functionally equaled the listings under this method. The other three methods of functional equivalence in the interim final rules required adjudicators to identify specific listings containing disabling functional limitations and to refer to them when they found functional equivalence.

Also, a frequent criticism of the broad areas of functioning was that they were “the same” as the domains in the childhood mental disorders listings because they used the same names. Although this criticism was inaccurate, it is true that the names of the domains in the interim final rules confused many people. The new domains are specifically designed for determining functional equivalence and are completely delinked from the mental disorders and other listings.

•

New domain for evaluating the physical effects of impairments.

We added a sixth domain, called “Health and physical well-being,” for evaluating the physical effects of both physical and mental impairments, except for motor functioning limitations, which will be evaluated in a separate domain (“Moving about and manipulating objects”). This domain includes guidance that was relevant to the prior functional equivalence method called “episodic impairments” (see § 416.926a(b)(3) of the interim final rules) but also includes new guidance in response to public comments.

•

The same number of domains for all children.

All six domains in the final rules apply to children from birth to the attainment of age 18. We agreed with the commenters that it is possible to describe domains that apply to all ages. We provide general descriptions of the domains and specific examples of typical and atypical functioning for each domain. In five of the six domains (all except “Health and physical well-being”), we provide detailed descriptors for each age group.

•

Communication addressed in the appropriate domains.

In the final rules, we no longer have a domain called “cognitive/communicative.” The different aspects of communication are addressed in each domain that they affect.

•

Guidance on evaluating multiple impairments.

We added more guidance and reminders about evaluating the functional limitations that result from combinations of impairments throughout these final rules, including in final § 416.926a. Final § 416.926a(c), “The interactive and cumulative effects of an impairment or multiple impairments,” addresses this issue specifically.

•

Clarification of how we use test results.

We did not adopt the comments that asked us to include specific reference to the SEM in our rules or to apply SEMs in certain ways. However,

in response to these comments, we clarified that we do not rely on any test score alone. We also clarified our longstanding policy that we may consider a child to have “marked” or “extreme” limitations with test scores that are slightly higher than the levels we use to define those terms. However, we explain that we may also consider the converse;

i.e.,

that a child with test scores that appear to be in the “marked” or “extreme” range may not have such limitations. We consider test scores in the context of all the evidence in the case record.

•

Better general guidance for considering all types of impairments.

In final §§ 416.924a and 416.926a, we provide better guidance for evaluating the effects of all impairments, including a number of specific impairments singled out by some commenters. In addition to improvements we made in final §§ 416.924a and 416.926a already noted, we also included more detailed guidance and examples for evaluating limitations in each of the domains. We included examples that we believe will be useful for evaluating both physical and mental impairments.

We continue to define listing-level severity as “marked” limitation in two domains or an extreme limitation in one domain.

Therefore, although we delinked our policy of functional equivalence from reference to specific listings, we continue to use the phrase “functionally equals the listings,” to underscore that the impairment(s) must be of listing-level severity.

The following is an explanation of the specific changes we made in final § 416.926a.

We revised § 416.926a(a), “General,” to reflect the changes to our functional equivalence policy in these final rules. We deleted the reference to “any listed impairment that includes disabling functional limitations among its criteria” in the first sentence because we no longer refer to specific listings. We deleted the second and third sentences for the same reason. We replaced the discussion with an explanation that an impairment or combination of impairments functionally equals the listings if it is of listing-level severity. We also included the definition of listing-level severity from § 416.925(b)(2) of the interim final rules, revised to reflect other changes;

i.e.,

to show that the impairment(s) must result in marked limitations in two domains or an extreme limitation in one domain.

We expanded the guidance in final paragraph (a) about what we consider when we evaluate a child's functioning. The first sentence of paragraph (a) of the interim final rules indicated that, when we assess functional limitations, we consider what the child “cannot do” because of his or her impairment(s). In the final rules, we clarify that we consider what the child “cannot do, [has] difficulty doing, need[s] help doing, or [is] restricted from doing” because of his or her impairment(s). This clarifies that we consider all of a child's limitations, even when the child has some ability to do an activity. We also added a reminder that we consider the interactive and cumulative effects of all the child's impairments for which we have evidence and references to other relevant rules we consider, especially those found in final § 416.924a.

We replaced §§ 416.926a(b), “How we determine functional equivalence,” and 416.926a(c), “Broad areas of development or functioning,” of the interim final rules with a series of new paragraphs. Paragraph (b) of the interim final rules explained the four methods we could use to determine functional equivalence. Since functional equivalence is now simplified into one method, we deleted those provisions of the interim final rules. However, we incorporated some of the principles of these paragraphs into other sections of the final rules, as already noted in the explanation of the changes in final § 416.924a and the summary of the key provisions of final § 416.926a.

We deleted the statement in the last sentence of interim final § 416.926a(b) about when we will complete a form SSA-538. This restatement of our policy in § 416.924(g) was redundant and unnecessary. A greater concern was that it was the only place in our rules where we repeated this requirement. We believe this may have given the mistaken impression that we do not complete the form when we decide whether a child's impairment(s) is severe, meets a listing, or medically equals a listing, as required in § 416.924(g).

In final §§ 416.926a(b), “How we will consider your functioning,” we explain that we use the word “activities” to mean everything a child does at home, in childcare, at school, and in the community. In final paragraph (b)(1), we list the new domain headings. They are:

• Acquiring and using information,

• Attending and completing tasks,

• Interacting and relating with others,

• Moving about and manipulating objects,

• Caring for yourself, and

• Health and physical well-being.

As we explain below, the new domain names largely clarify the broad areas of development or functioning we used in the interim final rules. In most cases, they rename, and to some extent reorganize, the prior areas of functioning, incorporating features of the other methods of functional equivalence we have deleted. They also respond to the major public comments about the domains by applying the same domains to children from birth to age 18, addressing the component parts of communication (explained later in this preamble) in the appropriate domains, providing better ways to evaluate the physical effects of impairments, and clarifying how we evaluate the effects of combinations of impairments and particular impairments.

We believe that the revised domains will be easier for our adjudicators to apply and for the public to understand. We believe that the new approach, together with the changes in final §§ 416.924a, provides a clearer, more comprehensive way to assess the effects of a child's impairment or combination of impairments on his or her functioning.

Final §§ 416.926a(b)(2) and (b)(3) provide guidance and reminders based on key provisions of final §§ 416.924a and 416.926a(a). Paragraph (b)(2) explains that there are six basic questions we will consider when we evaluate a child's functioning under the functional equivalence provisions. The six questions focus on the child's abilities and limitations, where the child has difficulty (

i.e.,

at home, in childcare, at school, or in the community), the quality of any limitations (

i.e.,

difficulty initiating, sustaining, or completing activities), and the kind, extent, and frequency of help the child needs. Final paragraph (b)(3) is based on § 416.926a(c)(2) of the interim final rules. It provides reminders of the kinds of evidence we will consider when we evaluate functioning under this section. In response to a public comment, we added cross-references to our rules on evidence and purchasing consultative examinations.

Final § 416.926a(c), “The interactive and cumulative effects of an impairment or multiple impairments,” is based on and clarifies our intent in §§ 416.924a(c) and 416.926a(c)(1) of the interim final rules. We included this paragraph in response to comments suggesting that we provide better guidance about these issues and that we simplify our functional equivalence policy.

The provisions of the paragraph are based on our longstanding policy that we consider the limitations that result from a single impairment or a combination of impairments in any domains that are affected. The interim

final rules recognized that these effects may be in areas that “may not be obviously relevant,” and provided (in § 416.924a(c)(3)(ii)) examples of young children who might have delays in developing motor skills or bonding emotionally because of visual or hearing impairments. We decided to delete the examples because they focused only on the youngest children and certain kinds of impairments. We also believed that the provision was misplaced with the rules on how we consider age because it provided guidance on how we consider functioning. Therefore, it was more appropriate to include this guidance in final §§ 416.924a and 416.926a.

Final paragraph (c) assumes that at this step in the sequential evaluation process for children we have already established the existence of at least one medically determinable impairment that is “severe.” Therefore, we explain that at this point we are looking primarily at the extent of the limitation of the child's functioning. We look at all of the child's activities to determine the child's limitations or restrictions and then decide which domains to use. (Of course, when we decide whether the child's medically determinable impairment(s) is “severe” we will look comprehensively at the combined effects of all of the child's impairments, unless we are able to decide the issue by looking at each of the child's impairments separately. We explain this point above and in § 416.924a(b)(4) of the final rules.)

We evaluate the limitations that result from a medically determinable impairment(s) in any single domain or in as many domains as are affected. We explain that any given activity may involve the integrated use of many abilities and skills. We also explain that any single impairment may have effects in more than one domain.

In final § 416.926a(d), “How we will decide that your impairment(s) functionally equals the listings,” we provide the basic rule for functional equivalence. To functionally equal the listings, an impairment or combination of impairments must be of “listing-level severity”;

i.e.,

it must result in marked limitations in two domains of functioning or extreme limitation in one domain. The disability must also meet the duration requirement;

i.e.,

it must have lasted or be expected to last for 12 months or to result in death. The provision is based on “listing-level severity” and the provisions of §§ 416.902, 416.925(b), and 416.926a(c) of the interim final rules. However, in the third sentence of this paragraph, we provide explicitly that we will not compare a child's functioning to the requirements of any specific listing to underscore that we are delinking the policy from direct reference to the listings.

Final § 416.926a(e), “How we define ‘marked’ and ‘extreme’ limitations,” is based on § 416.926a(c)(3) of the interim final rules. We reorganized and clarified the provisions from the interim final rules and expanded some of our guidance.

We begin with a general paragraph that reviews the major principles of all of the final rules. In subparagraph (ii), we repeat and expand our guidance about formal testing that appears in final § 416.924a(a)(1), which was based on § 416.924(f) of the interim final rules. The final provision explains that standard scores, such as percentiles, can be converted to standard deviations, and that we consider such scores with all the other evidence when we determine whether a child has a marked or extreme limitation in a domain.

In final § 416.926a(e)(2), “Marked limitation,” we reorganized the provisions of § 416.926a(c)(3)(i) from the interim final rules to provide the general definition of “marked” first. We explain that a child has a “marked” limitation in a domain when his or her impairment(s) “interferes seriously” with functioning in the domain before we provide the more specific definition based on standardized testing. We expanded the definition to refer to limitations in the ability to independently initiate, sustain, and complete activities to be consistent with our other revisions and to clarify the definition in response to comments. For the same reasons, we also revised the statement that “marked limitation may arise when several activities or functions are limited or even when only one is limited.” The final sentence provides that there may be a marked limitation when a child's “impairment(s) limits only one activity or when the interactive and cumulative effects of [the] impairment(s) limit several activities.”

In addition to retaining the other definitions of “marked” from the interim final rules, we also added a new one explaining that “marked” is the equivalent of functioning we would expect to find on standardized testing with scores that are at least two, but less than three, standard deviations below the mean. This includes in our rules a longstanding instruction from the training manual we provided to our adjudicators when the interim final rules were implemented. (Childhood Disability Training, SSA Office of Disability, Pub. No. 64-075, March 1997.)

In subparagraph (e)(2)(ii), we clarified our rule defining “marked” in terms of a developmental quotient for children who have not attained age 3. We continue to provide that such a child will have a “marked” limitation if he or she is functioning at a level that is more than one-half but not more than two-thirds of his or her chronological age. However, in response to a comment, we clarified that if there are standard scores from standardized testing in the case record, these scores take precedence over the more subjective estimate based on functioning relative to chronological age.

In subparagraph (e)(2)(iii), we retain our rule that a “marked” limitation is shown with a valid score that is two standard deviations below the mean, but less than three standard deviations, on a standardized test. We clarified the provision to indicate that the test must be a “comprehensive standardized test designed to measure ability or functioning in [the] domain” and that the test results and the child's day-to-day functioning in the domain-related activities must be consistent. This is another example of a clarification we made in response to comments that asked us to explain better how we will consider test scores.

Subparagraph (e)(2)(iv) is new. It provides an alternative definition for the term “marked” as it applies to the sixth domain of functioning, “Health and physical well-being.” As we explain below, this new domain considers the physical effects of both physical and mental impairments. It includes (but is not limited to) such effects as frequent exacerbations and frequent illnesses, and incorporates aspects of the functional equivalence method based on episodic impairments found in § 416.926a(b)(3) of the interim final rules.

The definition in this subparagraph describes the frequency of effects that demonstrate a “marked” limitation in this domain. Under the final rules, a child may have a marked limitation in this domain if he or she has illnesses or exacerbations from his or her impairment(s) that result in significant, documented symptoms or signs occurring on an average of 3 times a year or once every 4 months, each lasting 2 weeks or more. We provide alternative criteria for children who have more frequent, but shorter, episodes or less frequent, but longer, episodes.

We adopted this definition from other rules and guidance. We provide a similar criterion in section 14.00D8 in

the Immune System section of part A of our listings, which we use when we decide whether an individual meets the criteria of listing 14.08N. An individual who has HIV infection meets that listing with “repeated” manifestations of the illness as defined in 14.00D8 and “marked” limitations in one other specified domain. We also have operating instructions that we use to evaluate the frequency of exacerbations of serious mental disorders in adults under the fourth paragraph B criterion for most listings under section 12.00. It provides essentially the same criteria for assessing frequency in that domain as used here in the final childhood disability rules. (See Program Operations Manual System, DI 22511.005D.)

In both cases, the frequency criterion is the equivalent of one “marked” limitation, and individuals must still show “marked” limitation in a second domain to meet the listings. We believe the standard is appropriate for evaluating the frequency of exacerbations or illnesses in children too. The other definitions of the term “marked” in these final rules will also apply to the health and physical well-being domain when appropriate.

In final paragraph (e)(3), “Extreme limitation,” we made revisions to parallel the revisions in paragraph e)(2). To maintain consistency with the provision that describes a “marked” limitation when an impairment(s) “seriously” interferes with functioning in the domain, we added a parallel definition for extreme limitation when an impairment(s) “very seriously” interferes with functioning.

We also clarified the definition based on a public comment. In § 416.926a(c)(3)(ii)(C) of the interim final rules, we defined “extreme” as having “no meaningful function in a given area.” A commenter thought that this was a stricter standard than we intended, equivalent to a requirement that a child be completely unable to function. To clarify that this was not our intent, we deleted the phrase and added in the final rule that, while “extreme” is the rating we use for the worst limitations, it does not necessarily mean a total lack or loss of ability to function. It means that the impairment very seriously limits functioning, and is the equivalent of the functioning we would expect to find on standardized testing with scores that are at least three standard deviations below the mean.

For the domain of “Health and physical well-being,” we provide that episodes of illness or exacerbations of a child's impairment(s) “substantially in excess of” the criteria in paragraph (e)(2)(iv) will also constitute “extreme” limitation. However, we caution that impairments that occur with such frequency or for such extended periods of time that they could be rated as “extreme” under this definition should meet or medically equal a listing in most cases.

In final paragraph (e)(4), “How we will consider your test scores,” we expand on the guidance we provided in final § 416.924a(a)(1), focusing more on issues relating to the rating of the domains for functional equivalence. We added the paragraph in response to comments that suggested we include provisions specifying how we would apply the SEM. The paragraph explains that we may find that a child has a “marked” or “extreme” limitation with a test score that is slightly higher than the levels provided in this section if other information in the case record indicates that the child's functioning is seriously or very seriously limited because of his or her impairment(s). This means that we may find that a child has “marked” or “extreme” limitation in a domain even if he or she has test scores that are slightly higher than is required to satisfy the definitions of those terms based on standard deviations. Conversely, we explain that we may find that a child does not have a “marked” or “extreme” limitation even if the test scores are at the levels provided in this section if other information in the case record indicates that the child's functioning is not seriously or very seriously limited. We provide examples to illustrate both situations.

We also incorporate in the final rules guidance from our adjudicator training on how to consider IQ testing (Childhood Disability Evaluation Issues, SSA Office of Disability Pub. No. 64-076, March, 1998). This guidance applies to all testing, and explains how we resolve material inconsistencies between a child's test scores and the other information in the case record. We explain that, while it is our responsibility to resolve any material inconsistencies, the interpretation of a test is primarily the responsibility of the professional who administered the test. If necessary, we may recontact the individual who administered the test for further clarification.

However, we may also resolve an inconsistency with other information in the case record, by questioning other individuals who can provide us with information about a child's day-to-day functioning, or by purchasing a consultative examination. We also explain what we will do when we do not rely on a test score.

We believe these final provisions address most of the concerns of the commenters who asked us to include provisions recognizing the SEM. All measures of functioning are less than perfectly precise and have some range of error around their scores.

The SEM is one method of quantifying this variation. It is a statistical unit that can be used to construct a confidence interval. This interval reflects the reliance that can be placed in the accuracy of an obtained test value. For clinical purposes, the SEM is considered to fall symmetrically around a test score. Therefore, the confidence interval is described by the obtained score plus and minus the desired number of SEMs.

For example, given an obtained score of 72 and a hypothetical SEM of 5 points, one can say with 68 percent confidence that the examinee's true score falls somewhere within the range of 67 to 77. To be 95 percent confident, we must go to plus and minus two SEMs, or a score range of 62 to 82.

SEMs differ from test to test, summary score by summary score (

e.g.

, full scale IQ, verbal IQ, and performance IQ), and by age. Tables of SEMs are typically published within test manuals.

Because of the imprecision inherent in all psychometric devices, professionals who administer tests do not rely on the test scores alone. They consider as much other information as is available to help them judge whether a given test score is a meaningful measurement of a child's ability (or in some tests, the child's functioning) in the area addressed by the test.

For example, the major professional manuals defining mental retardation provide a rough clinical rule of thumb that IQs in the range of 50 to 75 indicate one level of mental retardation, but caution that the child's adaptive functioning must also be considered and must be consistent with the abilities suggested by such scores before a diagnosis of mental retardation may be made. Of course, the professional who administered the test is in the best position to determine the precision of his or her findings.

We believe that the final rules are the best possible way to recognize the less than perfect precision of test results. They recognize that we cannot rely on any given test score without considering it in the context of all the other evidence. They explain that we will generally defer to the judgment of the person who gave the test about the accuracy of the results, and they incorporate into our rules procedures for adjudicators to follow when they question test results.

In final § 416.926a(f), “How we will use the domains to help us evaluate your functioning,” we provide general information about the domains and how we will use them. Each domain description in final paragraphs (g) through (l) begins with a general description of the kinds of activities that should be evaluated under the domain in terms of what a child of the same age who does not have impairments is expected to be able to do.

Then, each domain description (except “Health and physical well-being,” which contains examples only of limitations) includes two kinds of examples: ones to illustrate typical functioning of children who do not have impairments, generally presented by age category, and ones to illustrate limitations. The examples are not all-inclusive, and we will not require our adjudicators to develop evidence about each specific example. They are intended only to help our adjudicators understand better some of the kinds of activities and limitations they should evaluate within each domain when this information is in the case record.

We also explain that the limitations do not necessarily describe “marked” or “extreme” limitations, only limitations of functioning within the domain. We must consider all of the information in the case record when we decide whether there is a “marked” or “extreme” limitation in a domain.

Final § 416.926a(g), “Acquiring and using information,” is, in part, the successor to the prior area of functioning called cognition/communication. In response to public comments about including communication in that area, these final rules recognize that “communication” comprises speech and language, and that language is used both for learning and for interacting and relating. Therefore, we address the three components of communication (speech, language used for learning, and language used for interacting and relating) in the domains that are appropriate to the function.

• Final paragraph (g)(1)(i) recognizes that the ability to acquire information, or learn, requires perceptual, sensorimotor, language, and memory processes that allow the child to acquire the fundamental skills of reading, writing, and doing arithmetic.

• Final paragraph (g)(1)(ii) recognizes that the ability to use information, or think, employs those same processes, through visual and verbal reasoning, to solve problems, make choices, develop ideas, and construct arguments or theories.

• Paragraph (g)(2) provides some examples of activities in “Acquiring and Using Information” typical of children in our designated age groups.

• Paragraph (g)(3) provides examples of some limitations in this domain.

Final § 416.926a(h), “Attending and completing tasks,” incorporates aspects from two prior areas of functioning. It includes some of the former area, “Responsiveness to Stimuli,” which applied only to children from birth to the attainment of age 1, and aspects of the former area, “Concentration, Persistence, or Pace,” which applied only to children from age 3 to the attainment of age 18. As with all of the domains in the final rules, this domain now applies to children of all ages.

The domain recognizes how attention evolves from an infant's earliest response to all types of environmental stimuli, to a school-age child's capacity to focus on certain stimuli (and ignore others) in a formal learning situation, and then eventually to an adolescent's capacity to maintain attention in work or work-like tasks.

• Paragraph (h)(1)(i) describes attention in terms of level of alertness, concentration, and the initiating, sustaining, and changing of focus needed to perform tasks.

• Paragraph (h)(1)(ii) further details the role of attention in physical and mental effort, in allaying impulsive thinking and acting, and in performing tasks at an appropriate pace, within appropriate timeframes.

• Paragraph (h)(2) provides some examples of activities in “Attending and Completing Tasks” typical of children in our designated age groups.

• Paragraph (h)(3) provides examples of some limitations in this domain.

Final § 416.926a(i), “Interacting and relating with others,” includes all aspects of social interaction and relationship with individuals or groups (in formal, informal, or intimate contexts) as well as the speech and language skills needed to communicate effectively in all social settings. This domain incorporates the prior area of “Social Functioning,” but now includes the ability to use speech and the aspect of language needed to interact and relate in social contexts (called “pragmatics”).

• Paragraph (i)(1)(i) discusses interacting with others as the broad set of social behaviors a child uses with any other person, whether in a single encounter or on a daily basis.

• Paragraph (i)(1)(ii) discusses relating to others as the formation of intimate relationships with particular people, which requires interacting skills as well as a wide array of emotional behaviors.

• Paragraph (i)(1)(iii) explains that interacting and relating entail responding to a variety of emotional and behavioral cues, speaking intelligibly, following social rules for conversation and interaction, and responding appropriately to others.

• Paragraph (i)(1)(iv) notes that interacting and relating occur in all of a child's activities that involve other people and may involve only one person or a group. Interacting and relating also occur across a wide range of social situations, from participating in school activities voluntarily to having appropriate responses to persons in authority.

• Paragraph (i)(2) provides some examples of activities in “Interacting and relating” typical of children in our designated age groups.

• Paragraph (i)(3) provides examples of some limitations in this domain.

Final § 416.926a(j), “Moving about and manipulating objects,” is the successor to the prior area of “Motor Functioning,” and includes gross and fine motor skills.

• Paragraph (j)(1)(i) describes the range of actions involved in moving one's body from one place to another, such as sitting, standing, balancing, shifting weight, transferring, bending, crouching, crawling, and running.

• Paragraph (j)(1)(ii) describes the kinds of actions involved in moving, holding, carrying, transferring, or manipulating objects.

• Paragraph (j)(1)(iii) discusses the underlying aspects of motor skill, such as coordination, dexterity, integration of sensory input with motor output, and the capacity to plan, remember, and execute controlled motor movements.

• Paragraph (j)(2) provides some examples of activities in “Moving about and manipulating objects” typical of children in our designated age groups.

• Paragraph (j)(3) provides examples of some limitations in this domain.

Final § 416.926a(k), “Caring for yourself,” incorporates and clarifies provisions of the “Personal” area in the interim final rules. It also incorporates principles from the areas in the interim final rules called “Responsiveness to Stimuli” and “Concentration, Persistence, or Pace” that are not covered by the domain for “Attending and completing tasks” in the final rules.

It includes aspects of the child's ability to appropriately care for physical needs (such as feeding, dressing, toileting, and bathing), maintain a healthy emotional and physical state by coping with stress and changes in his or her environment, and take care of his or her health and safety. Development is measured in terms of such things as the

child's increasing sense of independence and competence, ability to cooperate with others in meeting physical and emotional wants and needs, and increasing independence in making decisions and in taking actions involved in caring for himself or herself. Impaired ability is manifested by such things as pica (eating non-nutritive or inedible objects), self-injurious actions, refusal to take medication, and disturbances in eating and sleeping patterns.

• Paragraph (k)(2) provides some examples of activities in “Caring for yourself” typical of children in our designated age groups.

• Paragraph (k)(3) provides examples of some limitations in this domain.

Final § 416.926a(l), “Health and physical well-being,” is a new domain. It incorporates aspects of the two prior methods of determining functional equivalence called “Episodic impairments” and “Limitations related to treatment or medication effects.” (

See

§§ 416.926a(b)(3) and (b)(4) of the interim final rules.)

The domain addresses the cumulative physical effects of physical or mental impairments and the impact of their associated treatments or therapies on a child's functioning. Consistent with the definition of “extreme” in final § 416.926a(e)(3)(iv), it explains that an impairment(s) that causes “extreme” limitation in this domain will generally meet or medically equal a listing.

• Paragraph (l)(1) takes note of the variety of physical effects that a child may experience, such as shortness of breath, reduced stamina, poor growth, or pain.

• Paragraph (l)(2) notes that a child's medications or treatments may have physical effects that limit the performance of activities.

• Paragraph (l)(3) concerns children whose illness may be chronic with stable or episodic symptoms, or who may be medically fragile and need intensive medical care to maintain health.

• Paragraph (l)(4) provides some examples of limitations in health and physical well-being that may affect a child of any age.

We redesignated § 416.926a(d) of the interim final rules, “Examples of impairments that are functionally equivalent in severity to a listed impairment,” as final § 416.926a(m). We revised the heading and the opening paragraph to refer to impairments that “functionally equal the listings” consistent with other changes throughout these final rules.

We also deleted examples 5 and 10 and renumbered the remaining examples. Example 5 previously referred to any physical impairment(s) or combination of physical and mental impairments “causing marked restriction of age-appropriate personal functioning and marked restriction in motor functioning.” The example is no longer appropriate because we replaced the domain names and deleted the term “age-appropriate” from these final rules.

We could have revised the example to reflect the new terms in these final rules, but then it would simply repeat the definition of listing-level severity in final §§ 416.925 and 416.926a(a). We believe the revisions we made throughout final § 416.926a sufficiently clarify the principle that example 5 was intended to show.

Example 10 in the interim final rules referred explicitly to listing 112.12. We deleted this example because we are removing explicit reference to specific listings from our functional equivalence rules.

We also redesignated § 416.926a(e) of the interim final rules, “Responsibility for determining functional equivalence,” as final § 416.926a(n). Apart from the redesignation, there are no changes in the rule.

Changes to § 416.987 Disability Redeterminations for Individuals Who Attain Age 18

The only substantive change we made to the interim final rule is to incorporate the amendment to section 1614(a)(3)(H)(iii) of the Act made by section 5522(a)(1) of Pub. L. 105-33, 111 Stat. 251, 622. Under that section, we must perform a redetermination of the disability eligibility of children who attain age 18 “either during the 1-year period beginning on the individual's 18th birthday or, in lieu of a continuing disability review, whenever the Commissioner determines that an individual's case is subject to a redetermination under this clause.” The new provision is found in final § 416.987(c).

We also revised and shortened the entire section to remove redundancies and make it easier to read. These changes are only editorial and do not substantively change any provisions of the interim final rule.

Changes to § 416.990 When and How Often We Will Conduct a Continuing Disability Review

We revised § 416.990(b)(11) of the interim final rules to incorporate the amendment to section 1614(a)(3)(H)(iv) of the Act made by section 5522(a)(2)(B) of Pub. L. 105-33, 111 Stat. 251, 622. The section explains when we will do a continuing disability review (CDR) of the eligibility of a child whose low birth weight was a contributing factor material to our determination that he or she was disabled.

The original provision in Pub. L. 104-193 required us to do a CDR by the child's first birthday in all cases. The amendment in Pub. L. 105-33 changed the provision. Now we can do a CDR after a child's first birthday if at the time of the initial determination we determine that the child's impairment is not expected to improve by age 1 and we schedule a CDR for a date after the child's first birthday.

Changes to § 416.994a How We Will Determine Whether Your Disability Continues or Ends, and Whether You Are and Have Been Receiving Treatment That Is Medically Necessary and Available, Disabled Children

In final § 416.994a(i)(1)(ii), we deleted the word “Psychiatric” in response to a comment that pointed out that “Medical management” in § 416.994a(i)(1)(i) includes medical management provided by psychiatrists. We also corrected typographical errors and changed the text so it is consistent with the final rules on functional equivalence. Otherwise, the section is unchanged.

Other Changes

We made other changes throughout the rules for consistency with changes we have described above, to correct typographical errors, and to simplify language. For example:

• In the listings sections revised in the interim final rules, we changed the phrase “medically or functionally equivalent in severity to the criteria of a listed impairment” and variations on this phrase to “medically or functionally equals the listings.”

• In §§ 416.913(c)(3) and 416.919n(c)(6), we changed the names of the domains to reflect the changes in final § 416.926a.

Public Comments

In response to our request for comments on the interim final rules, we received 174 letters from different sources. Most of the comments came from advocacy and legal groups that represent children with disabilities. Other comments came from organizations representing children with specific diseases, disorders, or health problems, and from representatives of professional medical and health care organizations. We also received comments from several public agencies and professional organizations having an interest in these rules. Finally, some commenters were parents

or caregivers of children with disabilities.

In a number of cases, we received the same comment and recommendation from several, and sometimes many, commenters. When this happened, the comments and recommendations often used identical or very similar language. Several commenters also included statements in their letters indicating that, in addition to their individual comments, they agreed with the more detailed, comprehensive comments of another commenter, generally an advocacy group or coalition of advocates.

Because many of the comments were detailed, we condensed, summarized, or paraphrased them. However, we tried to summarize the commenters' views accurately and to respond to all of the significant issues raised by the commenters that were within the scope of the interim final rules.

Finally, many of the comments were outside the scope of the interim final rules. For example, some comments asked us to change rules that were not included in the interim final rules, and many comments contained opinions about Pub. L. 104-193 without suggesting changes to the interim final rules. In a few cases, we summarized and responded to such comments because they raised public concerns that we thought are important to address in this preamble. For example, we received many comments from people who were concerned about how we were going to redetermine the eligibility of children under the requirements of Pub. L. 104-193 and we thought it was important to explain what we did after the comments were submitted. In most cases, however, we did not summarize or respond to comments that were outside the scope of our rulemaking. We will retain the comments and consider them if and when they are appropriate for other rulemaking actions.

Specific Comments

Appendix 1 to Subpart P of Part 404—Listings Sections 112.00C and 112.02B2

Comment:

A few commenters expressed concerns about the removal of references to behavior from sections 112.00C2 and 112.02B2c(2). One thought that this change appeared to target children with “invisible disorders,” including attention deficit hyperactivity. Another asked us to instruct adjudicators not to evaluate lightly children with maladaptive behaviors, because these behaviors may indicate the presence of a serious mental impairment. Another commenter stated that the interim final rules did not adequately capture the behavioral expression of mental illness, especially in young children who do not have fully developed language skills.

Response:

We removed references to “behavior” and “maladaptive” behavior from the personal/behavioral domain of prior sections 112.00C2 and 112.02B2c(2) in accordance with the explicit requirements of the law, not because we wanted to “target” children with specific impairments.

See

section 211(b)(1) of Pub. L. 104-193, 110 Stat. 2105, 2189. The interim final rules made no changes to listing 112.11, our listing for evaluating claims filed on behalf of children who have attention deficit hyperactivity disorder, and children with this impairment can still meet or medically or functionally equal the requirements of the listings.

We agree with the commenter who thought that children whose mental impairments result in behavioral problems should have their claims carefully reviewed. In fact, since we published the interim final rules, we have taken a number of actions to ensure that all children, including those with mental impairments, have their claims evaluated correctly and in accordance with the law.

We conducted training for all our adjudicators in 1997, shortly after we published the interim final rules, and emphasized the evaluation of all aspects of childhood disability claims, including those involving behavioral issues. As we noted earlier in this preamble, in late 1997, we also conducted a “top-to-bottom” review of our implementation of the provisions of Pub. L. 104-193 that affected the SSI childhood disability program.

In the review, we found that about 95,000 children, or about 10 percent of the children receiving SSI in December 1996, had an impairment that likely involved maladaptive behaviors in the prior personal/behavioral area of functioning. Of these cases, about 16,500 children were not affected by the changes in the law because their impairments met or equaled the requirements of our listings without consideration of the prior personal/behavioral domain. Two-thirds of the remaining cases involving maladaptive behaviors required a redetermination because they qualified for benefits based on an IFA.

The “top-to-bottom” review, however, indicated that some redetermination cases where benefits ceased were not consistently processed, including some that involved mental impairments other than mental retardation. Consequently, we conducted additional training on these issues in the spring of 1998, and required the State agencies to review a portion of these cases. The March 1998 training included instruction on how to identify behavioral issues and the disorders with which they are likely to be associated, and emphasized that we still consider the functional limitations resulting from a child's behavior in determining whether a child is disabled.

We disagree with the commenter who thought that the interim final rules did not allow us to consider adequately the behavioral aspects of a child's mental impairment(s). The interim final rules never precluded consideration of functional limitations that result from behavioral problems, and our training and policy statements emphasized that fact. In the interim final rules, we clarified the description of the social area of functioning to emphasize that many impairment-related behavioral problems are likely to have their most significant effects on a child's social functioning. To reinforce the point further, we provided additional training to adjudicators that instructed them to consider behavior and outlined the various aspects to evaluate, including its nature, intensity, frequency, and duration. Our training also emphasized that adjudicators need to consider how behavior is affected by interventions.

We believe that the additional clarifications in the final rules, made to respond to these and other comments, further explain the issue. We provide descriptions and examples of functional limitations throughout the domains to make clearer where we consider the functional limitations of children whose physical and mental disorders include behavioral manifestations.

Comment:

Two commenters expressed concern about the childhood mental disorders listings, stating that they should be adjusted to reflect the diagnostic categories in the

Diagnostic and Statistical Manual of Mental Disorders

, Fourth Edition, Washington, DC, American Psychiatric Association, 1994 (the DSM-IV). One of these commenters believed that using the DSM-IV categories would address the “vagueness” of some mental disorders listings, especially for children and adolescents with emotional disturbance. The other commenter said that many of the adult and childhood mental disorders listings are out of date, in need of revision, and that we should regularly update them so that the functional equals concept works more equitably.

Response:

We did not adopt the comments because they were outside the scope of the interim final rules. The changes we made to the listings were only those necessary to implement Pub.

L. 104-193. We do not have the authority to issue final rules that revise the mental disorders listings as extensively as these commenters suggested without first proposing changes through notice-and-comment rulemaking under the Administrative Procedure Act.

We appreciate the comment suggesting that we update both the adult and the childhood mental disorders listings. We are considering such an update and will consider this and the other comments as we prepare any proposed revisions.

Section 416.902 General Definitions and Terms for This Subpart

Comment:

Many commenters stated that our interpretation of the phrase “marked and severe functional limitations” in the interim final rules did not properly reflect Congressional intent. These commenters supported their position by citing various portions of the legislative history of Pub. L. 104-193 and prior versions of the legislation that were not enacted into law.

Response:

We did not adopt these comments. These final rules continue to define the term “marked and severe functional limitations,” when used as a phrase, to mean the standard for disability in the Act for children claiming SSI benefits based on disability. We continue to define this standard in the final rules as being a level of severity that meets, medically equals, or functionally equals the listings.

Before we published the interim final rules in 1997, we carefully considered the statutory language and legislative history of Pub. L. 104-193, and the prior versions of the legislation that were not enacted into law, in order to determine the appropriate level of severity that would result in “marked and severe functional limitations.” We discussed some of the legislative history that influenced our decision on this issue in the preamble to the interim final rules. (62 FR 6408, 6409 (1997))

We have again reviewed the statutory language and legislative history of Pub. L. 104-193 and the prior versions of the legislation that were not enacted into law. We do not believe that the legislative history can fairly be read to preclude us from defining the phrase “marked and severe functional limitations” we did in the interim final rules and now in these final rules. The General Accounting Office reached a similar conclusion in its report to Congress on our development of the interim final rules. (Supplemental Security Income: Review of SSA Regulations Governing Children's Eligibility for the Program GAO/HEHS-97-220-R, September 16, 1997.) In that report, the GAO noted that it found the “interim final regulations to be consistent with the law.” GAO also stated: “We believe SSA was well within its authority in establishing the new level of severity, and its rationale for doing so was well supported.”

Some commenters supported their position by noting that the Senate “rejected” a disability standard contained in a prior House of Representatives” version of the legislation. This earlier version would have explicitly required a child to meet or equal the requirements of the listings as they existed as of April 1, 1995, in order to be found disabled. These commenters were referring to an early version of the legislation, under which “[e]ligibility, as determined by the Commissioner, for cash benefits * * * will be based solely on meeting or equalling [sic] the current Listings of Impairments [sic] set forth in the Code of Federal Regulations.’ H.R. Rep. No. 81 (Pt. 1), 104th Cong., 1st Sess. 48 (1995). Although the House of Representatives passed this bill, the childhood disability standard contained in the bill was just one of several alternative standards that Congress considered in various bills.

For example, the childhood disability standard contained in another bill would have eliminated the IFA, and would have provided that a child would be considered disabled if his or her impairment met the requirements of the listings or a functional equivalence standard separate from the listings. Another bill would have retained the IFA, but required changes to the regulations to provide that a child would be considered disabled if he or she had two marked limitations, or a “severe” limitation in one domain.

Still another bill would have retained the comparable severity standard, but clarified it to mean an impairment that was severe and persistent and which substantially limited a child's ability to develop or function. Under this proposed standard, “IFA-level severity” was two marked limitations, or one marked and one moderate limitation.

The Senate's initial version of H.R. 4, the legislation passed by the House, proposed a disability standard under which a child could be found disabled if he or she had “marked, pervasive and severe functional limitations.” S. Rep. No. 96, 104th Cong., 1st Sess., 20 (1995). The Senate later amended its proposal to drop the term “pervasive” from the definition of disability for children, so that the version of the legislation enacted in Pub. L. 104-193 provided that a child would be found disabled if he or she had an impairment(s) that resulted in “marked and severe functional limitations.”

The evolution of a childhood disability standard from the prior standard of “comparable severity” to one explicitly tied to the Listing of Impairments as it was in effect on April 1, 1995, to one requiring “marked, pervasive and severe functional limitations” to the final standard, requiring “marked and severe functional limitations,” does not represent a fundamental rejection of a standard based on listing-level severity, as some commenters seemed to assume. Rather than rejecting a disability standard based on listing-level severity, the changes made by the Senate to the definition of disability for children can best be viewed as providing a more flexible definition of disability than one explicitly tied to a specific set of regulatory criteria in effect on a specific date, as initially proposed by the House of Representatives.

The legislative history of the initial Senate version of the legislation, under which a child would be found disabled if he or she had “marked, pervasive and severe functional limitations,” indicates that “the Listing and the other disability determination regulations as modified by the Committee bill properly reflect the severity of disability contemplated by the statutory definition.” S. Rep. No. 96, 104th Cong., 1st Sess. 18 (1995). Materially identical language appears in the legislative history of Pub. L. 104-193, as we discussed in the interim final rules and earlier in this preamble.

Thus, we also disagree with commenters who noted that the Senate's removal of the word “pervasive” from the definition supported the conclusion that the level of severity in the interim final rules was stricter than what Congress intended. As we have noted, the material legislative history concerning the level of severity intended by the respective definitions is substantially identical for each version of the legislation.

Cf.

S. Rep. No. 96, 104th Cong., 1st Sess. 18-20 (1995)

with

H.R. Conf. Rep. No. 725, 104th Cong., 2d Sess. 328 (1996),

reprinted in

1996 U.S. Code, Cong. and Ad. News 2649, 2716 and H.R. Rep. No. 651, 104th Cong., 2d Sess. 1385 (1996),

reprinted in

1996 U.S. Code, Cong. and Ad. News 2183, 2444.

On a related point, the September 14, 1995, colloquy between Senator Dole and Senator Conrad, cited by some commenters to support their position, does not indicate that the Senate deleted the term “pervasive” to reject a standard of disability based on marked limitations in two domains or extreme

limitation in one. Rather, this discussion indicates that there was concern that the inclusion of the term “pervasive” in the earlier definition “implied some degree of impairment in almost all areas of a child's functioning or body systems.” Senator Dole noted that this “was not the intent of the earlier proposed change.” He further noted that “[s]ometimes children will have multiple impairments, sometimes they will not.” 141 Cong. Rec. S13613 (daily ed. September 14, 1995) (statement of Sen. Dole).

Thus, the colloquy indicates that the term was deleted to clarify that a child with severe disabilities could be found disabled even if he or she did not have multiple impairments that caused some degree of impairment in almost all areas of his or her functioning. The interim final and these final rules are consistent with that understanding of the term “marked and severe functional limitations.” We will find a child disabled, even if his or her impairment causes limitations in only one area of functioning, as long as the limitations are sufficiently serious.

Although we believe that the level of severity reflected in the interim final and final rules is consistent with the statutory text and legislative history of Pub. L. 104-193, we made a number of changes to improve and clarify them. We discuss these changes elsewhere in this preamble.

Comment:

Several commenters who objected to a standard of disability based on listing-level severity suggested revisions of the standard to a specified level of severity less than marked limitations in two domains or extreme limitation in one domain. One commenter stated that a standard of disability based on listing-level severity was inappropriate because the listings describe extreme pathology and gross failure of treatment, and, for the most part, do not provide a meaningful level of functional ability.

Commenters proposed a variety of standards for establishing disability, including: Marked limitation in one domain and moderate limitation in another; marked limitation in one domain and moderate limitations in two others; and moderate limitations in three “crucial” areas. Other commenters stated that we should revise the rules to provide that children with moderate limitations in multiple areas should be found disabled, or suggested other alternatives that would have similar results. Other commenters thought we should retain or reinstate the IFA.

Response:

We did not adopt these comments, but we have made changes in the final rules to address many of the commenters' concerns. As we explained above, we believe that the disability standard we adopted in the interim final and final rules is consistent with the statutory definition of disability in children. We explained our reasons for this conclusion above and in the preamble to the interim final rules.

As the commenters recognized, in enacting Pub. L. 104-193, Congress intended that we apply a stricter standard of disability than the one used under the prior law. Previously, a child would be considered disabled if he or she had an impairment or combination of impairments that was of “comparable severity” to one that was disabling in an adult. Our rules interpreting the comparable severity standard at the IFA step contained guidance that illustrated a level of impairment severity that generally, though not invariably, would be found sufficient to establish comparable severity.

See

§ 416.924e (1996) in the rules that preceded the interim final rules. Under these regulations, we could find a child disabled if we found on an IFA that his or her impairment or combination of impairments resulted in a “marked” limitation in one domain and a “moderate” limitation in another domain, or if his or her impairment(s) resulted in “moderate” limitations in three domains.

See

§ 416.924e(c)(1) (i) and (ii), and § 416.924e(c)(2)(i) and (ii) (1996).

Section 211(b)(2) of Pub. L. 104-193, 104 Stat. 2105, 2189, specifically directed us to discontinue use of the IFA set forth in former § 416.924d and 416.924e. In accordance with that statutory directive, we deleted those rules in the interim final rules. We have no authority to retain or reinstate the IFA. Furthermore, the suggestions to revise the disability standard to include children with impairments of less than listing-level severity (

e.g.

, one marked and one moderate limitation or three moderate limitations in “crucial” areas) would, in essence, result in the same level of severity we used when we performed an IFA under the prior law.

We do not believe that it would be consistent with the statutory definition of disability to allow a child to be found disabled based on one marked and two moderate limitations, or multiple moderate limitations, as some commenters suggested. “Moderate” limitations represent a wide spectrum, ranging from just above “slight” to just below “marked.” Consequently, we do not believe that a standard of severity based on moderate limitations, even multiple moderate ones, reflects a level of impairment severity that results in marked and severe functional limitations.

We disagree with the commenter who characterized our listings as “extreme” pathology, gross failure of treatment, and no meaningful level of functional ability. Our definition of “listing-level severity” in §§ 416.902 and 416.925(b) of the interim final rules—based on marked limitations in two domains or extreme limitation in one—made clear that a child could meet the standard without being as functionally limited as this commenter indicated.

We have, however, made many changes to address these concerns. Throughout the final rules, we made a number of changes to better explain how we consider the combined effects—what we now call the “interactive and cumulative effects”—of impairments. For example, we clarify in final § 416.926a(e)(2), what we have always intended by our statement in § 416.926a(c)(3)(C) of the interim final rules, that “marked limitation may arise when several activities or functions are limited or even when only one is limited.” We have clarified the sentence to provide that there may be a marked limitation when a child's “impairment(s) limits only one activity or when the interactive and cumulative effects of [the] impairment(s) limit several activities.” We made similar changes in the definition of “extreme” limitation in final § 416.926a(e)(3). We also clarified our definitions of these rating terms and improved our rules for evaluating functional limitations. We believe that the changes we made in the functional equivalence rules will address many commenters' concerns about how cases are evaluated using the childhood disability standard.

Comment:

Some commenters thought that there was “no justification in medical practice” for our interpretation of the statutory definition of disability for children, and that regulations need to more accurately reflect the current knowledge-base about what constitutes severe disorders in children. These commenters maintained that our interpretation would place many children with severe disorders at risk of losing their SSI payments.

A few commenters thought the severity standard represented an overreaction to the problem of program abuse,

e.g.

, alleged parental “schooling” (

i.e.

, coaching) of children, or that it was our solution to budgetary problems, at the expense of children with disabilities.

Response:

The references to “medical practice” and the “current knowledge-base about * * * severe disability in children” were unclear. We do not

believe that any part of these childhood disability regulations is inconsistent with, or contrary to, current medical practice or knowledge. Our intent is to fully recognize and fairly adjudicate cases of severe disability in children under the standard required by Pub. L. 104-193. Also, as noted in the previous response and in our summary of the final rules, we made many changes that we believe will address the commenters' concerns about how we evaluate a child's functional limitations within the domains.

We believe that the summary of our actions since 1997 at the beginning of this preamble responds to commenters who expressed concern that our interpretation would place many children with severe disorders at risk of losing their SSI payments. As we noted there, the Commissioner shared their concern and ordered a top-to-bottom review of our implementation of the law. As a result of that review, we took a number of major actions to ensure that children receiving benefits who should not have lost eligibility as a result of the changes in Pub. L. 104-193 retained their eligibility. The actions we took also helped to improve adjudication of new childhood disability claims.

As noted earlier, we believe that we have implemented Pub. L. 104-193 as Congress intended. Our interpretation was not an “overreaction” to reports of “coaching.” The commenter correctly noted that the issue of “coaching” of children, which was raised several years ago, was addressed in numerous ways before Congress changed the definition of disability. We studied the issue ourselves, as did the Office of the Inspector General for the Department of Health and Human Services, and the General Accounting Office. None of those studies found any noticeable incidence of parental coaching of children. Of the few instances in which coaching (or malingering) was suspected, none involved a finding of disability or eligibility for SSI payments.

Comment:

A few commenters suggested that we adopt eligibility criteria for other Federal and State programs for the children's SSI program. They specifically mentioned programs administered under Part H of the Individuals with Disabilities Education Act (IDEA) (now Part C of the IDEA, 20 U.S.C. 1431-1445, as a result of the Individuals with Disabilities Education Act Amendments of 1997, Pub. L. 105-17, 111 Stat. 37, 106-123). Some commenters suggested that we adopt the decisions made by other agencies.

Response:

We did not adopt the comments. As we noted in both the preamble to the interim final rules and earlier in this one, Congress provided a specific statutory standard for evaluating disability in children under SSI. We do not have the authority to adopt a definition from another statute.

Consistent with our longstanding policy, we cannot adopt disability determinations made by any other Federal or State programs. (

See

§ 416.904.) The Act requires that the Commissioner of Social Security and his delegates, and not another governmental or non-governmental party, make the determination that a child is or is not disabled.

Comment:

One commenter stated that the nature and cost of caring and providing support for individuals not properly served early in life increases significantly in their adult and aging years. This commenter believed that this argued for early intervention and a broader interpretation of the regulations.

Response:

As noted above and in the preamble to the interim final rules, we believe that the disability standard in these rules is consistent with the level of severity intended by the statutory definition of disability. However, we believe that the final rules will address concerns expressed by this commenter by ensuring that children who apply for SSI benefits will have their impairments evaluated fairly and in a manner consistent with the law. We also believe that the changes clarify our rules and procedures for evaluating the eligibility of infants and toddlers by providing the same number of domains of functioning and more detailed instructions and examples for them.

Comment:

Several commenters noted that the word “severe” had two different definitions under the law and that the regulations contained at least two instances where the two were used in the same sentence. They suggested that we change the regulations to minimize confusion, and provided specific language changes.

Response:

We partially adopted the comments. In the final rules we revised sentences noted by one commenter that used the word “severe” twice in different contexts within the same sentence. We also replaced many of the references to “marked and severe functional limitations,” the statutory standard, with phrases indicating that our intent is listing-level severity;

i.e.

, that the child's impairment(s) must meet, medically equal, or functionally equal the listings, avoiding the use of the word “severe.”

However, we did not adopt the comments that asked us to replace the word “severe” in step two of the sequential evaluation process for children with another term. We have used this term of art in our regulations and other instructions for evaluating disability in adults for over 20 years and for children since 1991. We believe that changing it now would be confusing.

Section 416.912 Evidence of Your Impairment and Section 416.913 Medical and Other Evidence of Your Impairment(s)

Comment:

One commenter said we should ask specific, individualized questions when requesting information from a treating source, teacher, or other individual to ensure the evidence addresses the critical issues for the particular applicant's impairment.

Response:

Our operating procedures already instruct the State agencies to make requests for information as specific as possible. We revise and update our forms for requesting information to ensure that we ask for relevant information. For example, we are developing a national teacher questionnaire for teachers to report specific information about a child's functioning. The State agencies also revise their forms as necessary to reflect changes in our rules and the needs and practices of their local medical providers, schools, and other sources.

Comment:

Several commenters said some children will not have resources to obtain a medical professional's opinion about the causes of their functional limitations. One commenter thought we should provide more assistance to families, especially in rural areas, to help them obtain relevant medical evidence for their disabled children. Another believed that functional limitations are self-evident, so there is no need for other expensive corroboration. One commenter expressed concern about parents of children from non-English-speaking households who lack a network of medical treating sources to provide evidence.

One commenter recommended that we emphasize that evidence other than symptoms, signs, and laboratory findings can play an extremely important role in establishing SSI eligibility. The commenter said that evidence from other qualified professionals, such as speech-language pathologists, audiologists, occupational and physical therapists, educators and early intervention specialists should be used, when appropriate, and examples of such evidence should be provided.

Response:

Section 416.912(d) of our regulations has long provided that we will make every reasonable effort to help individuals, including children and their families, to get medical reports from their own medical sources and

other evidence if we have their permission to do so. Section 416.914 of our rules also provides that we will pay for existing medical evidence, if there is a charge.

Under our rules in §§ 416.917 through 416.919a, we may also ask a child to go to one or more consultative examinations to get evidence we need to make a determination. There are several reasons we may ask a child to undergo a consultative examination, especially to get medical evidence when there is no medical source. When we ask a child to go to a consultative examination, we pay for the examination. We also have procedures to help people who do not speak English when they go to one.

In many cases, information we receive from schools includes medical evidence. Also, we recently revised our rules on medical evidence in § 416.913 to recognize school psychologists and speech-language pathologists as acceptable medical sources for certain kinds of impairments. (

See

65 FR 34950.)

In response to these comments and others, the final rules clarify the different sources from whom we may seek evidence of a child's medical condition or functional limitations. For example, we added references to early intervention programs, preschool, and childcare. We emphasized our longstanding policy that school evidence is important information about a child's functioning, and added references to other important sources of information about functioning, such as physical, occupational, and rehabilitation therapists, who may see a child at school or elsewhere. Finally, we added cross-references to our rules on evidence to final § 416.926a(b)(3), the section on how we consider functioning.

We disagree with the commenter who thought that a child's functional limitations are always self-evident. On the contrary, these final rules recognize that children may function differently in different settings and that some serious limitations may not be obvious; for example, when a child appears to be functioning well but is in fact receiving extraordinary assistance or supervision in a structured setting. In any event, section 1614(a)(3)(H)(i) of the Act (which incorporates by reference the provisions of section 223(d)(5)(A) of the Act) and §§ 416.928(a) and 416.929 of our rules specify that we need medical evidence (signs, symptoms, and laboratory findings) to determine disability.

These provisions indicate that a claimant's statements of symptoms are not by themselves conclusive evidence of disability. We must first establish the existence of a medically determinable impairment based on evidence from acceptable medical sources. Then, the evidence we use to assess the severity of a medically determinable impairment may come from both the “acceptable medical sources” listed in § 416.913(a), and “other sources” listed in § 416.913(d)(1) (including audiologists, occupational and physical therapists, educators, and early intervention specialists). Section 416.912(b)(4) includes a cross-reference to the sources listed in § 416.913(d).

Comment:

One commenter thought we should consider assessments provided by psychiatric social workers, clinical psychologists and clinical nurse specialists, as “valid and appropriate documentation” of a child's disability.

Response:

We consider licensed or certified psychologists to be “acceptable medical sources” in § 416.913(a)(2) of our regulations. As we previously stated, once we find that there is a medically determinable impairment with evidence from acceptable medical sources, we consider all relevant evidence we have in the case record when we decide whether a person is disabled. This may include evidence from health care professionals such as psychiatric social workers and clinical nurse-practitioners. Evidence from these other health care professionals helps us understand how a child's impairment(s) affects his or her ability to function, even though these sources are not “acceptable medical sources” for purposes of establishing the existence of a medically determinable impairment. This decision reflects our determination that there is insufficient standardization of their qualifications among the States for us to use them as acceptable medical sources.

Comment:

One commenter believed that the regulations should require school psychologists or other appropriately qualified mental health professionals, familiar with the school context and educational disabilities, to be involved in reporting information to us, because the way that observations of a child's disability are communicated could affect an eligibility determination. The commenter was concerned that the interim final rules could “marginalize[]” or exclude information from schools from the disability determination process. Similarly, another commenter requested that we amend the section on school attendance in § 416.924c(g) of the interim final rules to state that information on school functioning is always relevant and must be available.

Response:

The first comment was not clear to us, possibly because the letter did not specify language in the interim final rules that the commenter believed could lead to the exclusion of information from schools and education professionals. We consider reports from school professionals to be very important evidence of a child's functioning, and we made changes to the final rules to clarify this point.

We do not require information from school professionals in all cases because sometimes we can decide that a child is disabled without it, such as when a child's impairment(s) meets the requirements of certain listings. We also cannot require school evidence in all other cases because sometimes we are unable to get it despite reasonable efforts. However, our rules require our adjudicators to try to get school records whenever they are needed to make a determination or decision regarding a child's disability.

In addition to strengthening our rules about school evidence, which we explained previously, we are taking other actions to improve the type of evidence we get from schools. As already noted, we are developing a national teacher questionnaire to improve the evidence we get from teachers and other educational professionals. We also recently issued final rules to make school psychologists, or other licensed or certified individuals with other titles who perform the same function as a school psychologist in a school setting, “acceptable medical sources” in § 416.913(a) for the purpose of establishing mental retardation, learning disabilities, and borderline intellectual functioning.

Section 416.919a When We Will Purchase a Consultative Examination and How We Will Use It

Comment:

Several commenters suggested that we amend the regulations to indicate that State agencies will purchase tests to assess functioning when relevant or specifically to help establish functional equivalence. Others stated that we should require State agencies to schedule consultative examinations to obtain standardized testing to measure functioning when such testing is appropriate and not available from the child's treating source. One commenter also recommended that we regularly provide guidance to the State agencies about which tests are currently available and reliable to assess functioning for different age groups.

Response:

We did not adopt the comments in these final rules. We do not have general rules specifying the kinds of tests we purchase in all cases and, generally, we do not endorse

particular instruments in our regulations. Many standardized tests, like IQ tests, measure a child's abilities, not functioning, and may or may not reliably predict any given child's actual functioning. In some cases, there are no standardized tests to measure functioning in particular domains or for particular age groups, nor are all test instruments widely used or available. In many cases, we do not need to purchase standardized tests of ability or functioning because the case record contains sufficient information about functioning for us to make a determination or decision.

On the other hand, we agree that standardized testing can help improve the uniformity of decisionmaking. For this reason, we stress in the final rules the need to request records from early intervention programs, preschools, and schools, which often include the results of standardized testing. However, as already noted, we repeatedly caution our adjudicators not to rely exclusively on such tests because it is critical to consider their results in the context of all other evidence in the case record.

Sections 416.917 and 416.919a of our regulations provide for State agencies to purchase appropriate consultative examinations when evidence in the case record is not sufficient for us to make a disability determination or decision. These examinations may include standardized tests to assess ability or functioning.

We believe that the general suggestion that we provide guidance to our adjudicators about tests that are currently available and reliable is a good one. We have provided such guidance in the past in subregulatory documents and will consider whether to do so in the future. However, we believe that it would not be feasible for us to regularly provide information on all available, reliable tests because there are so many of them and new ones are constantly developed. To some extent, we must rely on the professional judgment of individuals who provide evidence to us and the ability of the individuals who adjudicate or review claims to follow what is available in their local area and to know which tests are available and appropriate for particular cases.

Comment:

Two commenters recommended that we clarify that if information received from a treating source, teacher, therapist, or other source is not sufficient to make a determination, adjudicators must seek additional consultation in order to make a determination based on complete and accurate information.

Response:

We agree with these comments, but do not believe that any changes are needed in these final rules. Sections 416.917 and 416.919a of our regulations already provide appropriate guidance for when to purchase a consultative examination. We have, however, included cross-references to our rules on consultative examinations in final § 416.926a(b)(3) in response to these and other comments.

Section 416.919n Informing the Examining Physician or Psychologist of Examination Scheduling, Report Content, and Signature Requirements

Comment:

Several commenters thought that the rules describing a complete consultative examination should include more detail about a child's functional limitations. They suggested adding a cross-reference to the areas of functioning for each age group, and requiring consultative examination reports to include an analysis of a child's functioning by comparison to the specific areas for the relevant age groups. They also recommended adding the appropriate cross-references to the rules on consideration of age (§ 416.924a of the interim final rules), functioning (§  416.924b), other factors (§ 416.924c), and symptoms, including pain (§ 416.929).

Response:

As explained above in the summary of the changes, we adopted most of these comments by adding cross-references throughout the final rules. In addition, we revised §§ 416.913(c)(3) and 416.919n(c)(6), our rules on the content of medical reports and reports of consultative examinations, to reflect the new domain names in final § 416.926a.

Section 416.924 How We Determine Disability for Children

Comment:

One commenter suggested that we revise the sequential evaluation process for children by separating the third step of the process (meets, medically equals, functionally equals) into three parts. The commenter thought that this would help ensure that adjudicators will apply each aspect of the third step before denying a claim.

Response:

We did not adopt the comment. We believe that adjudicators properly understand and apply the current three-step sequential evaluation process. However, we made a number of changes to clarify and improve § 416.924, as we explained in the summary of changes earlier in this preamble.

Comment:

A few commenters thought that we should require all adjudicators, including administrative law judges and administrative appeals judges on the Appeals Council, to explain their findings using our Form SSA-538, the Childhood Disability Evaluation Form. Others thought that we should include the form in the text of the rules or make the form widely available to the public, including members of the medical community, by publishing the form in the

Federal Register

or posting it on our Internet site. Others suggested specific revisions to the form, such as adding cross-references to various rules to the form.

Response:

We did not adopt the comments.

As we discussed in the preamble to the interim final rules (62 FR at 6412), our decision not to require administrative law judges or administrative appeals judges on the Appeals Council (when the Appeals Council issues a decision) to complete the form was based on the fact that these adjudicators issue decisions with detailed rationales and findings that explain how they apply the three steps of the sequential evaluation process for each child. Administrative law judge and Appeals Council decisions are quite different in form from most determinations prepared by a State agency because they include a more detailed explanation of the findings and conclusions, supported by a narrative rationale.

Consequently, requiring administrative law judges and administrative appeals judges to complete Form SSA-538 and append it to their decisions would only repeat information that is already contained in their decisions. This policy parallels what is done for adult disability claims, for which we do not require these adjudicators to complete or attach to their decisions residual functional capacity assessment forms. However, the final rules do not prohibit the use of Form SSA-538 at the hearings or appeals levels as a checklist or to help organize information in the record.

We did not require disability hearing officers in the State agencies to complete the form because they also provide detailed rationales on a special form that replicates information on Form SSA-538. However, we plan to issue a new form for disability hearing officers to use in childhood disability cases that will be specific to these final rules.

Although our forms are widely available to the public in our local offices, we do not include the text of any of our forms in our rules because they are not part of our substantive rules. Moreover, including Form SSA-538 in the rules would codify it and unnecessarily limit our flexibility to

change it as needed without undertaking rulemaking proceedings.

However, we agree with commenters who recommended that we revise the form. We are revising the form to be consistent with the changes in the final rules, and plan to have it ready by the time these rules go into effect. When we revise the form, we will consider ways in which we can ensure that it continues to be made available to the public, including the suggestions from the commenters.

Section 416.924b Functioning in Children, Interim Final Rules

Comment:

One commenter objected to the following statement in § 416.924b(b)(3): “Ordinarily, activities of daily living are most important as indicators of functional limitations in children aged 3 to attainment of age 16, although they may be used to evaluate children younger than age 3.” The commenter believed this statement ignores the importance of considering school functioning and social relationships.

Response:

We agree that the statement could have been confusing. For this and other reasons described earlier in this preamble, we deleted the provision and all the terms previously defined in § 416.924b, including “activities of daily living.”

Section 416.924c Other Factors We Will Consider, Interim Final Rules

Comment:

Several commenters recommended that we provide more specific guidance to adjudicators about how to consider “other factors” when evaluating disability. Some suggested that we link the “other factors” rules specifically to those for functional equivalence either by cross-references or by citing the areas of functioning affected by “other factors” considerations. A number of commenters recommended that we incorporate more detailed guidance from our operating instructions on “other factors” into the regulations. These commenters recommended that we clarify that:

• Structured settings or other highly supportive environments may appear to improve a child's functioning when the child's impairment(s) results in functional limitations outside the setting;

• A child may appear less impaired on a single examination than the evidence over time may show; and that

• Treatment may cause side effects that result in functional limitations.

Response:

We adopted the substance of all of these comments, although we did not necessarily duplicate text from our prior operating manual sections. As explained above in the summary of the changes, we significantly improved the “other factors” section of the rules.

See

final § 416.924a, “Considerations in determining disability for children.” We believe it is now a more comprehensive rule that expands and clarifies our guidance for considering the various individual factors, including some that are addressed in these comments. Provisions of the final rules that address specific factors mentioned in the comments are found in final § 416.924a(b)(5) (structured and supportive settings), new § 416.924a(b)(6) (one-time examinations, such as consultative examinations), and § 416.924a(b)(9) (medication and other kinds of treatment).

Comment:

One commenter suggested that we explain that other factors could increase the severity of a limitation in a specific area. This commenter noted that the presence of a significant “other factor” should allow an adjudicator to find a greater degree of limitation than would exist without consideration of the factor(s). The commenter provided an example of a child who has a moderate limitation and uses an assistive device. The commenter believed that such a child should be found to have a marked limitation.

Response:

We clarified the rules in response to this and other comments, but not in the specific way recommended. The purpose of the section on “Other factors” in the interim final rules was to provide guidance about some of the factors we consider when we evaluate a child's functional limitations, in addition to the objective medical findings and the child's symptoms. They are not additional factors to apply after we evaluate functioning, but are an integral part of the functional analysis. In response to this and other comments, we clarified all of the “other factors” rules in final § 416.924a and clarified in final § 416.926a that, at the functional equivalence step, we first look at a child's functional limitations in any domain that is affected.

We do not agree with the commenter's example, but it is to some extent addressed by several of the final provisions, especially final § 416.924a(b)(5). In that section, we explain that when we rate a child's functioning we consider the amount of extra help or adaptation the child may need to function as well as he or she does compared to other children of the same age who do not have impairments. Thus, we consider the need for an adaptation when we consider how seriously a child's functioning is limited.

However, that does not mean that we automatically presume that a child with an unspecified “moderate limitation in motor functioning” has a “marked” limitation merely because he or she uses an adaptive device. Apart from the fact that these rules do not define a “moderate” limitation, the example was too nonspecific. As we explain in final § 416.924a(b)(5), we consider how well a child functions by examining how independently the child is able to initiate, sustain, and complete his or her activities despite his or her impairment(s), compared to children of the same age who do not have impairments. We also clarify in these final rules our longstanding policy that we consider each child's impairment(s) and the functional limitations that result from it in any and all of the affected domains.

Comment:

A number of commenters recommended that we include in the list of other factors the “risk factors” that were proposed by some of the individual experts who gave us information to help us formulate the childhood disability regulations in 1991. Some commenters suggested that applicable “risk factors” would include: biological factors (

e.g.,

malnutrition, anemia and recurrent infections); factors related to health care (

e.g.,

less than optimal treatment availability); a history of abuse and neglect; multiple foster home placements; separation from family; and “toxic environment.” The commenters recommended these risk factors because they believed they are objectively observable and are considered indispensable by the professional communities when evaluating pediatric impairments.

Response:

We did not adopt the comments that asked us to include specific “risk factors,” although we expanded the list of factors in final § 416.924a that we will consider when evaluating a child's functioning. We also revised the areas of functioning to consider more specifically physical effects of impairments when we decide functional equivalence.

We addressed the issue of “risk factors” extensively in earlier versions of the childhood disability rules. We first addressed the issue in 1991 when we published regulations in response to the

Zebley

decision (56 FR 5534, 5551 (1991)). We received a number of identical public comments in response to those rules and again addressed the issue when we published revised rules in 1993 (58 FR 47532, 47552, 47575 (1993)). As we made clear in those earlier rules, we do consider what the

commenters called “risk factors” to the extent that they affect a child's medical status and functioning. However, some of the other factors recommended by the commenters are not relevant to a determination of disability. Interested readers may read a more extensive discussion of our reasons for not adopting this comment in those earlier publications.

Comment:

One commenter suggested that we strengthen the language regarding periods of remission because with medication, intervention, and therapy, many children experience periods of adequate functioning and require more intensive treatment and intervention only during periods of deterioration. The commenter believed that a period of 12 “contiguous” months of disability may not be appropriate for such children, and that the variation in the expression of “severe mental impairment” is not adequately addressed in the regulations and may lead to some children being inappropriately disqualified.

Response:

We adopted the comment by clarifying how we evaluate chronic impairments, especially in final § 416.924(b)(8), where we added new sentences to address the comment. We explain in that section that we recognize that when a child has a chronic impairment(s), his or her functioning may vary considerably over time and that we need to take into account the child's ability to function over time. This means that we will take into account any variation in a child's level of functioning to determine the impact of a chronic illness on his or her ability to function.

However, we do not agree with the suggestion that a child with a chronic impairment should not have to show disability over a continuous period of 12 months. The Act requires that a child be disabled for a continuous period of 12 months (or be expected to be disabled for a continuous period of 12 months), unless the impairment is expected to result in death.

Section 416.926 Medical Equivalence for Adults and Children

Comment:

Several commenters recommended that we clarify this section to ensure that adjudicators will consider all relevant evidence, not just symptoms, signs and laboratory findings, when we make a finding regarding medical equivalence.

Response:

We agree with the commenters' concerns that the regulation could be misinterpreted. Our policy is that the phrase “medical evidence only” in § 416.926(b) excludes consideration of only the vocational factors of age, education, and work experience. Other than these vocational factors, in accordance with § 416.926(a), we consider all relevant evidence in the case record when we make a finding regarding medical equivalence.

This issue was raised in the decision in

Hickman

v.

Apfel

, 187 F.3d 683 (7th Cir. 1999). In

Hickman,

the Court of Appeals interpreted our language in § 416.926(b) to preclude an adjudicator from relying on evidence other than evidence from a medical source when making a finding regarding medical equivalence. The

Hickman

decision differs from our national policy by requiring adjudicators to consider only a narrow definition of medical evidence, that is, evidence from medical sources, in determining medical equivalence and not permitting the use of other relevant evidence. In contrast, we interpret “medical evidence” broadly, to include not just objective test results or other findings reported by medical sources, but other information about an individual's medical conditions and their effects, including the individual's own description of his or her impairments. Thus, the Court's decision that medical equivalence is decided based solely on evidence from medical sources interprets the “medical evidence only” language of the regulation more narrowly than we intend.

On May 3, 2000, we published an acquiescence ruling, AR 00-2(7), for the

Hickman

decision (65 FR 25783). As we noted in that acquiescence ruling, we intend to clarify the regulations at issue in

Hickman

through the rulemaking process (65 FR at 25785). The concerns rais

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