Supplemental Security Income for the Aged, Blind, and Disabled; Continuation of Benefits and Special Eligibility for Certain Severely Impaired Recipients Who Work

DEPARTMENT OF HEALTH AND HUMAN SERVICES

20 CFR Part 416

[Regulations No. 16 ]

RIN 0960-AC22

Supplemental Security Income for the Aged, Blind, and Disabled;

Continuation of Benefits and Special Eligibility for Certain Severely

Impaired Recipients Who Work

AGENCY: Social Security Administration, HHS.

ACTION: Final rules.

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SUMMARY: These regulations reflect changes in the law made by the

Employment Opportunities for Disabled Americans Act and the Omnibus

Budget Reconciliation Act of 1990. These statutes made permanent,

simplified, and liberalized the incentives in the Social Security Act

(the Act) for disabled and blind supplemental security income (SSI)

recipients who attempt to work. They also liberalized the provision

that provides an impairment-related work expense exclusion from the

regular SSI income counting rules. In addition, we are making related

administrative policy changes necessary to carry out these provisions.

EFFECTIVE DATE: These rules are effective August 12, 1994.

FOR FURTHER INFORMATION CONTACT:

Regarding this Federal Register document--Richard M. Bresnick, Legal

Assistant, Office of Regulations, Social Security Administration, 6401

Security Boulevard, Baltimore, MD 21235, (410) 965-1758; regarding

eligibility or filing for benefits--our national toll-free number, 1-

800-772-1213.

SUPPLEMENTARY INFORMATION:

General

SSI payments are designed to provide a basic level of support for

certain aged, blind, or disabled individuals. Work incentive provisions

in the SSI program generally enable blind and disabled individuals to

return to work or increase their level of work activity without losing

SSI disability or blindness status. Certain work incentives provide

them some protection from having their SSI benefits reduced based on

their increased earnings. In most States, some provisions also permit

continued Medicaid coverage for qualified individuals even if their

earnings preclude any SSI cash payments.

Under the law in effect before July 1, 1987, regular SSI benefits

(section 1611 benefits) were payable to a disabled SSI recipient who

worked at the substantial gainful activity (SGA) level after a 9-month

trial work period. Work at the SGA level resulted in the cessation of

disability status and, thus, an inability to requalify for regular SSI

benefits without filing a new application if the work continued after a

15-month extended period of eligibility (EPE). Section 1619, in effect

from January 1, 1981, through June 30, 1987, permitted payment of

special SSI cash benefits (section 1619(a) benefits) to disabled

recipients who lost eligibility for section 1611 benefits because of

SGA. Section 1619(b) provided special SSI eligibility status for

Medicaid purposes to working disabled or blind individuals whose

earnings made them ineligible for SSI cash payments. Transitions

between the various statuses, particularly after the EPE, were

complicated. Many felt that the complexity deterred people from

participating in the section 1619 program.

Amendments to section 1619 addressed these concerns. Sections 2 and

4 of the Employment Opportunities for Disabled Americans Act, Public

Law (Pub. L.) 99-643, effective November 10, 1986 and July 1, 1987,

respectively, made permanent and provided several improvements to

sections 1619 (a) and (b). Section 5032 of the Omnibus Budget

Reconciliation Act of 1990, Pub. L. 101-508, effective May 1, 1991,

further amended section 1619(b) by eliminating the 65-year age limit

for special SSI eligibility status for Medicaid purposes. Section 5033

of Pub. L. 101-508, effective December 1, 1990, liberalized the

impairment-related work expense exclusion of section 1612(b)(4)(B)(ii)

of the Act.

These regulations were published in the Federal Register (58 FR

52458) as a notice of proposed rulemaking (NPRM) on October 8, 1993.

Interested parties were given 60 days to submit comments. The comment

period closed on December 7, 1993. We received two letters containing

comments. One commenter supported the proposed changes without

modification. The other generally supported the proposed changes, but

suggested that we add one clarifying statement. We explain below in the

Public Comments section of this preamble the nature of those comments

and how we accommodated the suggested revision. This commenter also

discussed matters that were not relevant to the proposed regulations.

We referred those matters to the appropriate component of the Social

Security Administration and do not address them in this preamble. In

addition, on December 3, 1993 (58 FR 63888) we published final rules

which added a new paragraph (c)(1) to Sec. 416.1112 governing the

exclusion from earned income of the earned income tax credit refund an

individual receives, and redesignated existing paragraphs of

Sec. 416.1112. Therefore, we have revised the references to paragraphs

of Sec. 416.1112 in these final rules to be consistent with the new

paragraph numbering. Further, we inadvertently did not provide a

complete reference to all the relevant income exclusions in

Sec. 416.1112 as we apply them in determining the State threshold

amount for purposes of determining section 1619(b) eligibility. We have

made this technical correction to Sec. 416.269 of these final rules.

Therefore, except for adding the requested clarifying statement,

updating regulatory references, and correcting typographical and

technical errors in the NPRM, we adopted the rules as proposed.

Regulatory Changes

1. Expiration Date of Section 1619

We revised Secs. 416.260 and 416.261 to remove the expiration date

to reflect the change made by section of Pub. L. 99-643 that made

section 1619 permanent.

2. Section 1619(a)--Special SSI Cash Benefits

Section 4 of Pub. L. 99-643 amended section 1619(a) of the Act to

provide special SSI cash benefits to an individual whose earnings

exceed the amount designated by the Secretary of Health and Human

Services (the Secretary) to represent SGA despite a disabling

impairment, provided that individual meets certain eligibility

requirements. We discuss below the changes we made to reflect the

changes in the law, as well as related policy changes.

We revised Sec. 416.262(a) to reflect that an individual must have

been eligible to receive a regular SSI benefit or federally

administered State supplementary payment based on disability in ``a,''

rather than ``the,'' month before the month for which section 1619(a)

eligibility is being determined. The statutory change removed the

former requirement that the individual must have been eligible for

regular SSI benefits, special SSI cash benefits, or State supplementary

payments in the month immediately prior to the month of eligibility

under section 1619(a). The month the individual was eligible for a

regular SSI benefit or federally administered State supplementary

payment may not be in a prior period of eligibility which has

terminated according to Secs. 416.1331-416.1335.

We revised Sec. 416.262(d) to reflect the statutory change that an

individual must ``meet,'' rather than ``continue to meet,'' all

nondisability requirements for SSI eligibility in the month for which

the determination is being made.

These two changes permit eligibility for special SSI cash benefits

following one or more months of suspension.

We revised Secs. 416.260, 416.261, and 416.262(b) to reflect that

an individual is eligible for benefits under section 1619(a) when his

or her ``gross earned income,'' rather than ``earnings'' as described

in Sec. 416.1110, exceeds the designated SGA amount (currently $500 per

month). Because actual monthly determinations of SGA are not required

before an individual moves from section 1611 to 1619(a) status, we will

use gross earned income rather than earnings. This is consistent with

Congress' intent, as shown in the legislative history of section 1619,

to simplify transitions between benefit statuses, limit actual

determinations of eligibility, and ease administration of the section

1619 program. In response to a public comment, we added a new sentence

to Sec. 416.260 clarifying that the calculation of this gross earned

income amount is not to be considered an actual SGA determination. We

discuss this clarification below. For disabled individuals otherwise

eligible for a cash benefit, the only distinction between regular

benefit status under section 1611 and section 1619(a) status will be

whether or not their gross earned income exceeds the SGA level. Section

1619(a) does not apply to the blind because earnings of blind

individuals are not subject to an SGA test under the SSI program.

3. Section 1619(b)--Special SSI Eligibility Status

Section 4 of Pub. L. 99-643 and section 5032 of Pub. L. 101-508

amended section 1619(b) of the Act to provide changes in the

eligibility requirements for special SSI eligibility status. We discuss

below the changes we made to reflect the changes in the law, as well as

related policy changes.

We revised Sec. 416.264 to provide that special SSI eligibility

status applies for purposes of reacquiring status as eligible for

regular or special SSI cash benefits, as well as establishing or

maintaining eligibility for Medicaid.

We revised Sec. 416.265 to remove the 65-year age limit for section

1619(b) eligibility status effective May 1, 1991.

We also revised Sec. 416.265 to reflect that an individual must

have been eligible for a regular SSI benefit or a federally

administered State supplementary payment in ``a month before the

month,'' rather than ``the month before the first month,'' for which

eligibility for special SSI eligibility status is being determined. The

month the individual was eligible for a regular SSI benefit or

federally administered State supplementary payment may not be in a

prior period of eligibility which has terminated according to

Secs. 416.1331-416.1335.

We revised Sec. 416.265(b) to reflect that an individual, except

for earnings, must ``meet,'' rather than ``continue to meet,'' all

nondisability requirements for SSI eligibility in the month for which

the determination is being made.

These two changes permit special SSI eligibility status for

Medicaid purposes following one or more months of suspension.

We revised Sec. 416.265(d) to add that we will consider publicly

funded attendant care services, in addition to SSI benefits, federally

administered State supplementary payments, and Medicaid, when

determining whether an individual's earnings are sufficient to allow

the individual to provide a reasonable equivalent of the benefits which

would be available if the individual did not have those earnings.

We revised Sec. 416.268 to add that an individual may establish the

need for Medicaid eligibility to continue working (see Sec. 416.265(c))

by showing that Medicaid benefits would be needed to pay for unexpected

medical expenses in the next 12 months. Previously, we considered only

past or expected Medicaid use. This policy change adds consideration of

the individual's ability to pay for unexpected medical expenses to the

factors that can meet the statutory provision that termination of

Medicaid would seriously inhibit the individual's ability to continue

working. We believe the proposed change is consistent with the intent

of Pub. L. 99-643 because such individuals, if not accorded section

1619(b) status, might be forced to stop working in order to get

Medicaid to pay for unexpected medical expenses. This change enables

individuals without recurring medical expenses or expectation of

expenses to meet the requirement if they cannot provide for their own

medical care.

We also deleted former paragraphs (b) and (c) of Sec. 416.268,

which required an individual's signed statement about use or expected

use of Medicaid and verification, as necessary, of past services with

the service providers or the State agency administering the Medicaid

program. This change permits us to determine the need for Medicaid in

order to continue working based on information provided by the

individual. Our operational experience shows that the individual's

knowledge about use or expected use of Medicaid is almost always valid

and, therefore, verification results in unnecessary administrative

burdens and costs.

We revised Sec. 416.269 to reflect the statutory expansion of the

factors considered in determining the sufficiency of a person's

earnings to provide a reasonable equivalent of the benefits which would

be available absent those earnings (see Sec. 416.265(d)). We determine

insufficiency of earnings by comparing actual and/or anticipated gross

earnings for the 12-month period, beginning with the month for which

special SSI eligibility status is being determined, with a threshold

amount for the individual's State of residence. We determine the

threshold amount using the amount of gross earnings that it would take

to reduce to zero the Federal SSI benefit and State supplementary

payment for an individual with no other income living in his or her own

household and the average Medicaid expenditures for disabled SSI cash

recipients for the State of residence. If an individual's gross

earnings exceed the State threshold amount, we do a second comparison

to compare the earnings with an individualized threshold. In making

this determination, we will consider any amounts excluded as

impairment-related work expenses or work expenses of the blind, amounts

used or set aside for use under an approved plan for achieving self-

support, and the value of any publicly funded attendant care services.

We also added Sec. 416.269(d), which explains that we will consider

the value of attendant care services for purposes of sufficiency of

earnings determinations if the services are provided by a paid

attendant, needed to assist with work-related and/or individual

functions, and paid from Federal, State, or local funds.

We also added Sec. 416.269(e) to reflect that we will base

determinations of sufficiency of earnings on information and data

updated no less frequently than annually.

Also, because Sec. 416.269 predated retrospective monthly

accounting, we further revised it. For sufficiency of earnings

determinations, we will use the calendar month, rather than quarter,

for which we are determining eligibility for special SSI eligibility

status as the beginning of the 12-month period.

4. Impairment-Related Work Expense Change

In enacting Pub. L. 99-643, Congress recognized that disabled

individuals who make work attempts may not be able to follow a steady

progression from regular SSI status under section 1611 to special SSI

cash benefit status under section 1619(a), to special SSI eligibility

status under section 1619(b), and then to a status of complete

independence. In reality, such individuals tend to have setbacks which

may cause a drop in earnings and, therefore, a change in eligibility

status. According to the legislative history of Pub. L. 99-643, it was

Congress' intent to provide for easy transition, in either direction,

between the various categories of benefits. Therefore, we revised

Sec. 416.1112(c)(6) to facilitate easier movement between different

benefit statuses. For periods prior to December 1, 1990, an individual

who remained continuously eligible for a benefit under section 1611,

1616 (if supplementation is federally administered), 1619(a), or

1619(b), continued to qualify for the impairment-related work expense

exclusion in determining financial eligibility for SSI. Also, to

reflect section 5033 of Pub. L. 101-508, for periods after November 30,

1990, we removed the requirement that an individual must establish

eligibility without benefit of the impairment related work expense

exclusion.

5. Administrative Actions Under Section 1619(a)

In addition to the changes already discussed, these regulations

contain changes which we believe are consistent with the legislative

intent of Pub. L. 99-643 to simplify administration of section 1619 and

facilitate transition among the various categories of benefits. We

revised Secs. 416.1402 and 416.1403 with regard to initial

determinations in order to state our policy on determinations involving

transitions between sections 1611, 1619(a), and 1619(b).

We revised Sec. 416.1402(a) to clarify that initial determinations

regarding SSI benefits include, but are not limited to, determinations

about eligibility for or the amount of SSI benefits or special SSI cash

benefits, except actions solely involving transitions to eligibility

between these types of benefits. We revised Sec. 416.1402(b) to clarify

that the administrative actions of ``suspension'' and ``termination''

pertain to special SSI eligibility status under section 1619(b) as well

as SSI cash benefits under section 1611 or section 1619(a).

We deleted former Sec. 416.1402(h), which provided that a

determination about whether an individual is eligible for special SSI

cash benefits under Sec. 416.262 (section 1619(a) status) is an initial

determination, and redesignated the subsequent paragraphs. The change

recognizes that transition alone from eligibility for regular SSI

benefits under section 1611 to eligibility for special SSI cash

benefits under section 1619(a) and vice versa generally has little

practical effect on an individual. The change allows movement between

the statuses to be made with fewer steps, saving time and

administrative expense. We believe this change is consistent with

Congress' intent to simplify transitions between benefit statuses.

In addition, we revised Sec. 416.1403(a) to include in the list of

administrative actions that are not initial determinations, transitions

from section 1611 to 1619(a) eligibility or section 1619(a) to 1611

eligibility. If a recipient's section 1611 or 1619(a) benefits are

adversely affected (i.e., reduced, suspended, or terminated) for a

reason unrelated to his or her medical condition at the time of the

shift, such planned action(s) will continue to be subject to advance

notice of benefit reduction, suspension, or termination and be covered

as initial determinations under Sec. 416.1402(b). If an individual's

benefit amount increases, an initial determination is made under

Sec. 416.1402(a). Determinations about an individual's disability are

also initial determinations under Sec. 416.1402.

Redesignated Sec. 416.1402(h) (former Sec. 416.1402(i)) provides

that a determination about whether an individual is eligible for

special SSI eligibility status under Sec. 416.265 is an initial

determination. Section 416.265 describes the eligibility requirements

for special SSI eligibility status under section 1619(b).

Because we must make a threshold calculation and a finding that an

individual needs Medicaid to continue working in order to determine

eligibility under section 1619(b), we will continue to provide an

initial determination. Movement from special SSI eligibility status

under section 1619(b) back to regular SSI benefit status under section

1611 or special SSI cash benefit status under section 1619(a) is

defined to be an initial determination under Sec. 416.1402(a).

Public Comments

The following is a summary of the substantive comments we received

on the proposed rules and our response to them.

Comment: The commenter was concerned about using gross earned

income, rather than actual countable earnings, in transitions between

benefit statuses as described in Secs. 416.260, 416.261, and

416.262(b). The commenter was not so much concerned with using the

gross earned income amount at the time of the transition between

benefit statuses, but rather how that amount might be interpreted in

other determinations in the SSI program. The commenter suggested adding

a clarifying statement indicating that the gross income amount used in

the transition process is not to be considered an SGA determination.

Response: Although in the preamble to the proposed rules (58 FR

52458, 52459) we stated that we would not make actual SGA

determinations on whether an individual is eligible for section 1619

status, we agree with the suggestion to add the clarifying statement to

these final rules. We have added the statement to Sec. 416.260, which

deals specifically with transitions between benefit statuses under

sections 1611 and 1619.

Regulatory Procedures

Executive Order (E.O.) 12866

We have consulted with the Office of Management and Budget (OMB)

and determined that these rules do not meet the criteria for a

significant regulatory action under E.O. 12866. Thus, they were not

subject to OMB review.

All program changes reflected in these regulations related to Pub.

L. 99-643 and Pub. L. 101-508 were implemented on their respective

effective dates. As of December 1993, there were 20,028 section 1619(a)

participants and 35,299 section 1619(b) participants.

Paperwork Reduction Act

These regulations contain information collection requirements in

Sec. 416.268. As required by the Paperwork Reduction Act of 1980, 44

U.S.C. 3504(h), we submitted a copy to OMB for its review and we

received clearance to collect this information under OMB No. 0960-0267.

Public reporting burden for this collection of information is

estimated to average 3 minutes per response. This includes the time it

will take to read the instructions, gather the necessary facts, and

provide the information. Since we estimate that 25,000 SSI recipients

will provide this information, the total annual burden is estimated to

be 1,250 hours.

Organizations or individuals desiring to submit comments on these

information collection requirements should direct them to the Social

Security Administration, 6401 Security Boulevard, Baltimore, Maryland

21235, Attention: Reports Clearance Officer, 1-A-21 Operations

Building, and to the Office of Information and Regulatory Affairs, OMB,

New Executive Office Building, Room 3208, Washington, D.C. 20503,

Attention: Desk Officer for HHS.

Regulatory Flexibility Act

We certify that these regulations will not have a significant

economic impact on a substantial number of small entities because they

affect only individuals and States. Therefore, a regulatory flexibility

analysis as provided in Pub. L. 96-354, the Regulatory Flexibility Act,

is not required.

(Catalog of Federal Domestic Assistance Program No. 93.807,

Supplemental Security Income)

List of Subjects in 20 CFR Part 416

Administrative practice and procedure, Aged, Blind, Disability

benefits, Public assistance programs, Supplemental Security Income

(SSI), Reporting and recordkeeping requirements.

Dated: June 27, 1994.

Shirley Chater,

Commissioner of Social Security.

Approved: August 5, 1994.

Donna E. Shalala,

Secretary of Health and Human Services.

Subparts B, K, and N of part 416 of chapter III of title 20 of the

Code of Federal Regulations are amended as follows:

1. The authority citation for subpart B of part 416 is revised to

read as follows:

Authority: Secs. 1102, 1110(b), 1602, 1611, 1614, 1615(c),

1619(a), 1631, and 1634 of the Social Security Act; 42 U.S.C. 1302,

1310(b), 1381a, 1382, 1382c, 1382d(c), 1382h(a), 1383, and 1383c;

secs. 211 and 212 of Pub. L. 93-66, 87 Stat. 154 and 155; sec.

502(a) of Pub. L. 94-241, 90 Stat. 268; and sec. 2 of Pub. L. 99-

643, 100 Stat. 3574.

2. The undesignated center heading immediately above Sec. 416.260

is revised to read as follows:

Special Provisions for People Who Work Despite a Disabling

Impairment

3. Section 416.260 is revised to read as follows:

Sec. 416.260 General.

The regulations in Secs. 416.260 through 416.269 describe the rules

for determining eligibility for special SSI cash benefits and for

special SSI eligibility status for an individual who works despite a

disabling impairment. Under these rules an individual who works despite

a disabling impairment may qualify for special SSI cash benefits and in

most cases for Medicaid benefits when his or her gross earned income

exceeds the applicable dollar amount which ordinarily represents SGA

described in Sec. 416.974(b)(2). The calculation of this gross earned

income amount, however, is not to be considered an actual SGA

determination. Also, for purposes of determining eligibility or

continuing eligibility for Medicaid benefits, a blind or disabled

individual (no longer eligible for regular SSI benefits or for special

SSI cash benefits) who, except for earnings, would otherwise be

eligible for SSI cash benefits may be eligible for a special SSI

eligibility status under which he or she is considered to be a blind or

disabled individual receiving SSI benefits. We explain the rules for

eligibility for special SSI cash benefits in Secs. 416.261 and 416.262.

We explain the rules for the special SSI eligibility status in

Secs. 416.264 through 416.269.

4. The undesignated center heading immediately above Sec. 416.261

is removed.

5. Section 416.261 is amended by revising the first sentence to

read as follows:

Sec. 416.261 What are special SSI cash benefits and when are they

payable.

Special SSI cash benefits are benefits that we may pay you in lieu

of regular SSI benefits because your gross earned income in a month of

initial eligibility for regular SSI benefits exceeds the amount

ordinarily considered to represent SGA under Sec. 416.974(b)(2). * * *

6. Section 416.262 is amended by revising the introductory text and

paragraphs (a), (b), and (d) to read as follows:

Sec. 416.262 Eligibility requirements for special SSI cash benefits.

You are eligible for special SSI cash benefits if you meet the

following requirements--

(a) You were eligible for a regular SSI benefit or a federally

administered State supplementary payment (see Sec. 416.2001) in a month

before the month for which we are determining your eligibility for

special SSI cash benefits as long as that month was not in a prior

period of eligibility which has terminated according to Secs. 416.1331

through 416.1335;

(b) In the month for which we are making the determination, your

gross earned income exceeds the amount ordinarily considered to

represent SGA under Sec. 416.974(b)(2);

(c) * * *

(d) You meet all the nondisability requirements for eligibility for

SSI benefits (see Sec. 416.202).

7. Section 416.264 is revised to read as follows:

Sec. 416.264 When does the special SSI eligibility status apply.

The special SSI eligibility status applies for the purposes of

establishing or maintaining your eligibility for Medicaid. For these

purposes we continue to consider you to be a blind or disabled

individual receiving benefits even though you are in fact no longer

receiving regular SSI benefits or special SSI cash benefits. You must

meet the eligibility requirements in Sec. 416.265 in order to qualify

for the special SSI eligibility status. Special SSI eligibility status

also applies for purposes of reacquiring status as eligible for regular

SSI benefits or special SSI cash benefits.

8. Section 416.265 is amended by revising the heading to the

section, introductory paragraph and paragraphs (b) and (d) to read as

follows:

Sec. 416.265 Requirements for the special SSI eligibility status.

In order to be eligible for the special SSI eligibility status, you

must have been eligible to receive a regular SSI benefit or a federally

administered State supplementary payment (see Sec. 416.2001) in a month

before the month for which we are making the special SSI eligibility

status determination. The month you were eligible for a regular SSI

benefit or a federally administered State supplementary payment may not

be in a prior period of eligibility which has been terminated according

to Secs. 416.1331 through 416.1335. For periods prior to May 1, 1991,

you must be under age 65. Also, we must establish that:

(a) * * *

(b) Except for your earnings, you meet all the nondisability

requirements for eligibility for SSI benefits (see Sec. 416.202);

(c) * * *

(d) Your earnings after the exclusions in Sec. 416.1112(c) (6),

(8), and (9) are not sufficient to allow you to provide yourself with a

reasonable equivalent of the benefits (SSI benefits, federally

administered State supplementary payments, Medicaid, and publicly-

funded attendant care services, including personal care assistance

under Sec. 416.269(d) which would be available to you if you did not

have those earnings (see Sec. 416.269).

9. The undesignated center heading immediately above Sec. 416.267

is removed.

10. Section 416.268 is revised to read as follows:

Sec. 416.268 What is done to determine if you must have Medicaid in

order to work.

For us to determine that you need Medicaid benefits in order to

continue to work, you must establish:

(a) That you are currently using or have received services which

were paid for by Medicaid during the period which began 12 months

before our first contact with you to discuss this use; or

(b) That you expect to use these services within the next 12

months; or

(c) That you would need Medicaid to pay for unexpected medical

expenses in the next 12 months.

11. Section 416.269 is revised to read as follows:

Sec. 416.269 What is done to determine whether your earnings are too

low to provide comparable benefits and services you would receive in

the absence of those earnings.

(a) What we determine. We must determine whether your earnings are

too low to provide you with benefits and services comparable to the

benefits and services you would receive if you did not have those

earnings (see Sec. 416.265(d)).

(b) How the determination is made. In determining whether your

earnings are too low to provide you with benefits and services

comparable to the benefits and services you would receive if you did

not have those earnings, we compare your anticipated gross earnings (or

a combination of anticipated and actual gross earnings, as appropriate)

for the 12-month period beginning with the month for which your special

SSI eligibility status is being determined to a threshold amount for

your State of residence. This threshold amount consists of the sum for

a 12-month period of two items, as follows:

(1) The amount of gross earnings including amounts excluded under

Sec. 416.1112(c) (4), (5) and (7) that would reduce to zero the Federal

SSI benefit and the optional State supplementary payment for an

individual with no other income living in his or her own household in

the State where you reside. This amount will varry from State to State

depending on the amount of the State supplementary payment; and

(2) The average expenditures for Medicaid benefits for disabled and

blind SSI cash recipients, including recipients of federally

administered State supplementary payments only, in your State of

residence.

(c) How the eligibility requirements are met.

(1) You meet the requirements in Sec. 416.265(d) if the comparison

shows that your gross earnings are equal to or less than the applicable

threshold amount for your State, as determined under paragraphs (b) (1)

and (2) of this section. However, if the comparison shows that these

earnings exceed the applicable threshold amount for your State, we will

establish (and use in a second comparison) an individualized threshold

taking into account the total amount of:

(i) the amount determined under paragraph (b)(1) of this section

that would reduce to zero the Federal SSI benefit and State

supplementary payment for your actual living arrangement;

(ii) the average Medicaid expenditures for your State of residence

under paragraph (b)(2) of this section or, if higher, your actual

medical expenditures in the appropriate 12-month period;

(iii) any amounts excluded from your income as impairment-related

work expenses (see Sec. 416.1112(c)(6)), work expenses of the blind

(see Sec. 416.1112(c)(8)), and income used or set aside for use under

an approved plan for achieving self support (see Sec. 416.1112(c)(9));

and

(iv) the value of any publicly-funded attendant care services as

described in paragraph (d) of this section (including personal care

assistance).

(2) If you have already completed the 12-month period for which we

are determining your eligibility, we will consider only the

expenditures made in that period.

(d) Attendant care services. Expenditures for attendant care

services (including personal care assistance) which would be available

to you in the absence of earnings that make you ineligible for SSI cash

benefits will be considered in the individualized threshold (as

described in paragraph (c)(1) of this section) if we establish that

they are:

(1) Provided by a paid attendant;

(2) Needed to assist with work-related and/or personal functions;

and

(3) Paid from Federal, State, or local funds.

(e) Annual update of information. The threshold amounts used in

determinations of sufficiency of earnings will be based on information

and data updated no less frequently than annually.

12. The authority citation for subpart K of part 416 is revised to

read as follows:

Authority: Secs. 1102, 1602, 1611, 1612, 1613, 1614(f), 1621,

and 1631 of the Social Security Act; 42 U.S.C. 1302, 1381a, 1382,

1382a, 1382b, 1382c(f), 1382j, and 1383; sec. 211 of Pub. L. 93-66,

87 Stat. 154.

13. Section 416.1112 is amended by revising paragraph (c)(6) to

read as follows:

Sec. 416.1112 Earned income we do not count.

* * * * *

(c) * * *

(6) Earned income you use to pay impairment-related work expenses

described in Sec. 416.976, if you are disabled (but not blind) and

under age 65 or you are disabled (but not blind) and received SSI as a

disabled individual (or received disability payments under a former

State plan) for the month before you reached age 65.

(i) For periods prior to December 1, 1990, you must be able,

however, to establish your initial eligibility for Federal benefits

without the use of the impairment-related work expense exclusion. Once

you establish your initial eligibility without the use of the

impairment-related work expense exclusion, the exclusion applies for

determining your eligibility for all subsequent consecutive months for

which you are eligible for regular SSI benefits, federally administered

optional State supplementary payments, special SSI cash benefits or

special SSI eligibility status. If, in a subsequent month, you are not

eligible for any of these benefits, you cannot reestablish your

eligibility for Federal SSI benefits or federally administered optional

State supplementary payments before December 1, 1990, using the

impairment-related work expense exclusion.

(ii) For periods after November 30, 1990, you may also use the

impairment-related work expense exclusion to establish initial

eligibility and reeligibility following a month in which you were not

eligible for regular SSI benefits, a federally administered optional

State supplementary payment, special SSI cash benefits or special SSI

eligibility status.

* * * * *

14. The authority citation for subpart N of part 416 is revised to

read as follows:

Authority: Secs. 1102, 1631, and 1633 of the Social Security

Act; 42 U.S.C. 1302, 1383, and 1383b.

15. Section 416.1402 is amended by revising paragraphs (a) and (b),

removing paragraph (h), and redesignating paragraphs (i) through (n) as

paragraphs (h) through (m), respectively, to read as follows:

Sec. 416.1402 Administrative actions that are initial determinations.

* * * * *

(a) Your eligibility for, or the amount of, your supplemental

security income benefits or your special SSI cash benefits under

Sec. 416.262, except actions solely involving transitions to

eligibility between these types of benefits (see Secs. 416.1403 (a)(13)

and (a)(14)).

(b) Suspension, reduction, or termination of your SSI benefits or

special SSI cash benefits (see Secs. 416.261 and 416.262) or suspension

or termination of your special SSI eligibility status (see

Secs. 416.264 through 416.269);

* * * * *

16. Section 416.1403 is amended by adding new paragraphs (a)(13)

and (a)(14) to read as follows:

Sec. 416.1403 Administrative actions that are not initial

determinations.

(a) * * *

(13) Transition to eligibility for special SSI cash benefits

(Sec. 416.262) in a month immediately following a month for which you

were eligible for regular SSI benefits; and

(14) Transition to eligibility for regular SSI benefits in a month

immediately following a month for which you were eligible for special

SSI cash benefits (Sec. 416.262).

* * * * *

[FR Doc. 94-19712 Filed 8-11-94; 8:45 am]

BILLING CODE 4190-29-P