Adopted Sections An agency may take final action on a section 30 days after a proposal has been published in the Texas Register. The section becomes effective 20 days after the agency files the correct document with the Texas Register, unless a later date is specified or unless a federal statute or regulation requires implementation of the action on shorter notice. If an agency adopts the section without any changes to the proposed text, only the preamble of the notice and statement of legal authority will be published. If an agency adopts the section with changes to the proposed text, the proposal will be republished with the changes. TITLE I. ADMINISTRATION Part V. State Purchasing and General Services Commission Chapter 113. Central Purchasing Division Cooperative Purchasing Program 1 TAC sec.sec.113.81, 113.85, 113.87 The State Purchasing and General Services Commission adopts amendments to sec.sec.113.81, 113.85, and 113.87 concerning the cooperative purchasing program, without changes to the proposed text as published in the July 30, 1991, issue of the Texas Register (16 TexReg 4123). The reason for adopting the sections as proposed is to implement provisions of the Local Government Code, Chapter 271, as amended by Senate Bull 1369, Acts, 72nd Legislature, 1991. The sections delete the requirement for local governments to advise which commission contracts they want to utilize in cooperative purchasing, add language that participation in the program is voluntary, require requisitions for contract items to be processed through the commission, and mandate that the commission charge fees to cover costs associated with operating the program. Two comments were received. One commentor protested the proposed requirement to charge fees. One commentor expressed disagreement with the statement that there would be no fiscal impact as a result of enforcing or administering the sections, and objected to the proposed fee assessment. Commenting against the sections were the City of Ganado and the Austin Independent School District. The agency disagrees with the comments because House Bill 1369, Acts, 72nd Legislature (1991) requires the commission to charge reasonable fees for participation in the program. Further, since participation in the program is voluntary, local governments are not required to incur increased costs under the program. The amendments are adopted under Texas Civil Statutes, Article 601b, sec.3.01, which provide the State Purchasing and General Services Commission with the authority to promulgate rules to accomplish the purpose of Article 3. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 26, 1991. TRD-9111851 Judith Monaco Porras General Counsel State Purchasing and General Services Commission Effective date: November 17, 1991 Proposal publication date: July 30, 1991 For further information, please call: (512) 463-3446 TITLE 19. EDUCATION Part II. Texas Education Agency Chapter 109. Budgeting, Accounting, and Auditing Subchapter D. Adoptions by Reference 19 TAC sec.109.61 The Texas Education Agency (TEA) adopts an amendment to sec.109.61 concerning financial accounting manual, without changes to the proposed text as published in the August 27, 1991, issue of the Texas Register (16 TexReg 4677). The amendment concerns the adoption by reference of Change 25 to the financial accounting manual for school districts and regional education service centers, Bulletin 679. Change 25 primarily addresses the implementation of accounting procedures for Tier 1 revenues. Procedure number ACT-311 was expanded substantially to provide accounting instructions to county education districts. County education districts, according to House Bill 2885, 72nd Legislature, are required to comply with the budgeting, accounting, audit and depository contract laws that apply to local education agencies. Justification for the amendment will be school district and regional education service center compliance with accounting procedures for Tier 1 revenues. The amendment will function by providing school districts and regional education service centers with the new statutory requirements relating to financial accounting. No comments were received regarding adoption of the amendment. The amendment is adopted under the Texas Education Code, sec.11.29, which directs the commissioner of education to adopt annually a budget for operating the Foundation School Program, the Central Education Agency, and other programs for which the State Board of Education has responsibility. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 19, 1991. TRD-9111886 Criss Cloudt Director, Planning Coordination Texas Education Agency Effective date: October 18, 1991 Proposal publication date: August 27, 1991 For further information, please call: (512) 463-9701 TITLE 28. INSURANCE Part II. Texas Workers' Compensation Commission Chapter 42. Medical Benefits Subchapter B. Medical Cost Evaluation 28 TAC sec.42.110 The Executive Director of the Texas Workers' Compensation Commission adopts the repeal of 28 TAC sec.42.110 concerning official health facility fee guidelines, without changes to the proposed text as published in the March 29, 1991, issue of the Texas Register (16 TexReg 1869). The reason for the adoption of the repeal is that this section will be replaced by proposed new sec.42.110, titled hospital and ambulatory surgical center fee guidelines which was submitted and proposed in the June 4, 1991, issue of the Texas Register (16 TexReg 3026 and 3027). The new section was then adopted on an emergency basis to be effective June 30, 1991, as published in the Texas Register on June 28, 1991 (16 TexReg 3567). The emergency adoption of the new section has been withdrawn effective July 3, 1991, as published on July 12, 1991, in the Texas Register (16 TexReg 3863), and a Notice of Non-Enforcement was submitted to the Texas Register by the Texas Workers' Compensation Commission on July 15, 1991, and published in the Texas Register on July 26, 1991 (16 TexReg 4103) to comply with a Temporary Restraining Order that was issued in Cause Number 449,718, Texas Hospital Association et al v. Industrial Accident Board in the 345th Judicial District Court of Travis County. The proposed new sec.42.110 is still pending. No comments were received regarding adoption of the repeal. The executive director of the commission administers old law in the board's stead. The executive director of the commission has determined that the repeal of sec.42.110 should be adopted. The legal authority to adopt lies under Texas Civil Statutes, Article 8306, sec.7b (1990) and the Texas Workers's Compensation Act, Article 8308, sec.17.12(b) which requires the commission to delegate appropriate powers and duties to the executive director to administer the workers' compensation law in effect prior to the effective date of the new Texas Workers' Compensation Act (which delegation was made by the commission on April 1, 1990) giving the executive director authority to implement and enforce the workers' compensation laws for injuries occurring prior to January 1, 1991. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 30, 1991. TRD-9111955 Todd K. Brown Acting Executive Director Texas Workers' Compensation Commission Effective date: October 21, 1991 Proposal publication date: March 29, 1991 For further information, please call: (512) 448-7962 TITLE 40. SOCIAL SERVICES AND ASSISTANCE Part I. Texas Department of Human Services Chapter 15. Medicaid Eligibility Subchapter A. General Information The Texas Department of Human Services adopts the repeal of sec.15.430 and amendments to sec.sec.15.100, 15.410, 15.431-15.433, 15.441, 15.455, 15.475, 15. 501, 15.503, and 15.506, and new sec.15.434, concerning spousal impoverishment provisions, in its Medicaid Eligibility chapter. The repeal, amendments, and new section are a result of Public Law 100-360. The repeal, amendments, and new section are justified because they comply with federal requirements. The repeal, amendments, and new section will function by protecting income and resources for the community-based spouse when the other spouse is institutionalized and eligible for Medicaid. 40 TAC sec.15.100 The amendment is adopted under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes the department to administer public and medical assistance programs. To comply with federal requirements, this amendment is adopted to be effective September 30, 1989. sec.15.100. Definitions. The following words and terms, when used in this chapter, have the following meanings, unless the context clearly indicates otherwise. Financial duress -Having insufficient funds to meet living expenses because of debts incurred for medical expenses for the institutionalized spouse, community-based spouse, or dependent, or because of replacement of a resource lost through theft or acts of God. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 26, 1991. TRD-9111862 Nancy Murphy Agency liaison, Policy and Document Support Texas Department of Human Services Effective date: September 30, 1989 For further information, please call: (512) 450-3765 Chapter 15. Medicaid Eligibility Subchapter D. Resources 40 TAC sec.sec.15.410, 15.431-15.434, 15.441 The amendments and new section are adopted under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes the department to administer public and medical assistance programs. To comply with federal requirements, these amendments are adopted to be effective September 30, 1989. sec.15.410. Deeming of Resources. (a) Deeming of spouse's resources. The department deems spouse's re- sources as follows: (1) (No change.) (2) Spouses living in separate households or living together in a long-term care facility. If the client does not live in the same household as his ineligible spouse, the department does not apply deeming policies. In situations where an institutionalized client has an ineligible spouse also living in a facility, only the client's resources are counted against the individual resource limit. The department includes in the client's resources the total amount of checking and savings accounts to which he has access. (3) TP51J client living with spouse in the community. The department does not apply deeming policies to a Rider 49 client discharged from a long-term care facility to the community. The client's eligibility is determined under the supplemental security income (SSI)-related MAO program criteria that applied when he lived in the long-term care facility. His resources are considered separately from those of his ineligible spouse, just as they were when the client was institutionalized. (b) (No change.) sec.15.431. Transfer of Resources-July 1, 1988, and After. (a) Purpose. The Medicare Catastrophic Coverage Act of 1988 (Public Law 100- 360) restricts the transfer-of-resource policy to clients eligible under institutional criteria for any uncompensated transfer occurring on or after July 1, 1988. The uncompensated value of a transfer occurring with client participation on or after July 1, 1988, may result in a penalty period for nursing facility care or home/community-based waiver services for the lessor of: (1)-(2) (No change.) (b) Compensation. Compensation, in the form of funds, real property, or services, must actually have been provided to the client. Future compensation does not satisfy the compensation requirement. Compensation, however, may be in the form of payment or assumption of a legal debt owed by the individual making the transfer. Compensation is not allowed for services that would be normally provided by a family member. The client must provide valid receipts for financial expenditures or written statements from the people who were paid to provide the services. If the client receives additional cash compensation that was not a part of the transfer agreement from the party who received the transferred resource, the uncompensated value of the transferred resource must be reduced by the amount of the additional compensation and as of the date the compensation is received. Cash compensation includes direct payments to a third party to meet the client's food, shelter, or medical expenses, including nursing home bills, incurred after the date of the transfer. Compensation for a transferred resource must be provided according to terms of an agreement established on or before the date of transfer. This agreement must have been established exclusively for purposes other than obtaining or retaining eligibility for Medicaid services. (c) (No change.) (d) Opportunity for rebuttal. If any amount of uncompensated value exists, the department advises the client or responsible party of the amount of uncompensated value and the length of the penalty period. The penalty period applies, unless the client provides convincing evidence that the disposal was solely for some purpose other than to obtain Medicaid services. If, within the periods specified in this subsection, the client or responsible party makes no effort to rebut the presumption that the transfer was solely to obtain Medicaid services, the department assumes that the presumption is valid. The rebuttal period is five workdays after oral notification (by the department to the client) and seven workdays after written notification. (e) Rebuttal of the presumption. Transfer-of-resources statutes presumes that all transfers for less than fair market value are to obtain Medicaid services. The client or responsible party is responsible for providing convincing evidence that the transaction in question was exclusively for some other purpose. To rebut the presumption, the client or responsible party must provide a written statement and any relevant documentation to substantiate his statement. The statement, oral or written, must include at least the following items: (1)-(5) (No change.) sec.15.432. Exceptions to Transfer of Resources-July 1, 1988, and After. (a) Transfer of the client's home does not affect his eligibility when the title is transferred to his: (1) spouse, who lives in the home (after December 19, 1989, the transfer penalty applies when the community-based spouse transfers the home, without full compensation); (2)-(4) (No change.) (b) Resources, including the client's home, may be transferred without affecting eligibility when: (1) the resources are transferred to the client's spouse (who lives in the community), or his disabled child, or to another person for the sole benefit of the spouse or child (If transferred to another person, the resources must be held in trust or a fiduciary account. After December 19, 1989, the transfer penalty applies when the community-based spouse transfers a resource without full compensation and when the transfer is not for the community spouse's sole benefit.); (2) satisfactory evidence exists that the client intended to dispose of the resource at fair market value; (3) satisfactory evidence exists that the transfer was exclusively for some purpose other than to qualify for Medicaid; or (4) denial of eligibility would cause undue hardship. (c) (No change.) sec.15.433. Transfer of Resources Penalty Period. (a) The penalty period begins with the month the transfer occurred. For resources transferred in different months, penalty periods run concurrently. The penalty applies only to nursing facility care and home/community-based waiver services (Type Program 19). If a transfer occurred with the client's knowledge and consent, the department considers the fair market value of the resource at the time of transfer in order to determine the penalty period. The client remains eligible for all other Medicaid benefits and continues to receive a monthly identification form. Both the client and the service provider are notified of the penalty period. Supplemental security income clients or clients in the community who are eligible under Type Program 03, 11, 18, or 22 or 1929(b) may transfer resources without penalty provided they do not become institu- tionalized. For community-based MAO clients, except Type Program 19, the department gathers information about transfers occurring on or after July 1, 1988, and notifies the client of potential penalty if he is institutionalized. Type Program 19 clients may be ineligible for home/community-based waiver services for up to 30 months if the transfer results in any uncompensated value. (b) The Omnibus Budget Reconciliation Act of 1989 (Public Law 101-239) expanded the transfer penalty so that it also applies when the community-based spouse transfers assets for less than fair market value. This penalty applies to transfers by the community-based spouse that occur after December 19, 1989. If resources are transferred to a third party before institutionalization or by the community spouse after December 19, 1989, the department does not include the uncompensated amount in calculating the protected resource amount or countable resources upon application for Medicaid. sec.15.434. Spouse-to-spouse Transfers Under Spousal Impoverishment Provisions. (a) There are no restrictions on interspousal transfers occurring from the date of institutionalization to the date of the MAO application; the reason is that at application and throughout the initial eligibility period, the combined countable resources of the couple are considered in determining eligibility. For the same reason, interspousal transfers are permitted before institutionalization. Retroactive to December 19, 1989, a penalty attaches when the community spouse transfers resources to a third party. (b) To remain eligible at the end of the initial eligibility period, the institutionalized spouse must reduce resources to which he has access at least to the resource limit. If the institutionalized spouse chooses, he may, during the initial eligibility period, transfer resources from his name to the community spouse's name with no penalty applied to the transfer. The transfer- of-resources policy, which was effective July 1, 1988, applies only to transfers of resources that are for less than fair market value to individuals other than the community spouse. (c) Transfer penalties apply when the community spouse transfers his separate property before institutionalization, or after institutionalization but before the MAO certification. Transfer penalties apply when the community spouse transfers community property both before and after institutionalization. sec.15.441. Real Property. (a) Home. The value of a home that is a client's or his spouse's principal place of residence is not a resource of the client or spouse. (1)-(8) (No change.) (9) Community spouse living in another state. If the community spouse lives in another state in a house that the client claims is not his homestead, for the protected resource amount and initial eligibility determination, the department excludes the out-of-state property as a part of resources totally excluded regardless of value. If the client still has an ownership interest in the property at the first annual review, the value of the property is a countable resource as real property. This situation does not affect residency requirements. As long as the institutionalized spouse intends to remain in the state where he is institutionalized, he is considered a resident. (b) (No change.) This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 26, 1991. TRD-9111863 Nancy Murphy Agency liaison, Policy and Document Support Texas Department of Human Services Effective date: September 30, 1989 For further information, please call: (512) 450-3765 Subchapter D. Resources 40 TAC sec.15.430 The repeal is adopted under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes the department to administer public and medical assistance programs. To comply with federal requirements, this repeal is adopted to be effective September 30, 1989. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 26, 1991. TRD-9111866 Nancy Murphy Agency liaison, Policy and Document Support Texas Department of Human Services Effective date: September 30, 1989 For further information, please call: (512) 450-3765 Subchapter E. Income 40 TAC sec.15.455, sec.15.475 The amendments are adopted under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes the department to administer public and medical assistance programs. To comply with federal requirements, these amendments are adopted to be effective September 30, 1989. sec.15.455. Unearned Income. (a)-(d) (No change.) (e) Other unearned income. Other sources of unearned income include: (1) (No change.) (2) interest payments on joint bank accounts. In this context, the term "spouse" includes a spouse whose income is considered in the applied income determination process. Interest payments on joint bank accounts are considered as follows: (A)-(C) (No change.) (3)-(9) (No change.) (10) income paid to an institutionalized member of a couple. When one member of a couple is institutionalized, income paid to one spouse is considered to be the income of that spouse, unless a fair hearings process establishes otherwise, or the payor provides evidence that the income is augmented for a spouse, such as VA benefits. Income from community property paid to only one spouse is considered the income of that spouse regardless of state law governing community property or division of marital property. sec.15.475. Deeming of Income. (a) The following requirements apply. (1) (No change.) (2) The department exempts certain types of income that may be received by a client's ineligible spouse, ineligible parent, a parent's ineligible spouse, or any ineligible children living in the household. The following types of income are not deemed to the client: (A) -(D) (No change.) (b) The following applies when deeming procedures are not used. (1) (No change.) (2) The department does not apply the deeming process to TP51J clients discharged to the community. Although a TP51J client may live in the same household with his ineligible spouse, the TP51J client's eligibility is determined under the applicable criteria used when he was living in a nursing facility. (3) In certain waiver programs, a parent's income is not deemed to a child. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 26, 1991. TRD-9111864 Nancy Murphy Agency liaison, Policy and Document Support Texas Department of Human Services Effective date: September 30, 1989 For further information, please call: (512) 450-3765 Subchapter F. Budgets and Payment Plans 40 TAC sec.sec.15.501, 15.503, 15.506 The amendments are adopted under the Human Resources Code, Title 2, Chapters 22 and 32, which authorizes the department to administer public and medical assistance programs. To comply with federal requirements, these amendments are adopted to be effective September 30, 1989. sec.15.501. Vendor Living Arrangements. (a)-(d) (No change.) (e) Using the special income limit for an individual, the department considers only the client's income in determining eligibility. The ineligible spouse's income is considered in determining the amount of applied income. (f) Clients whose VA benefits are capped at $90 per month retain the full $90 as a personal needs allowance. (g)-(l) (No change.) sec.15.503. Protection of Spousal Income and Resources. (a) Effective September 30, 1989, Public Law 100-360 provided for the protection of income for the community spouse and certain dependent family members when the other spouse is institutionalized. A standard spousal allowance is diverted to the community spouse whose income is less than the allowance. The allowance is deducted from the couple's combined monthly income. (1) The dependent allowance is calculated by subtracting the dependent's income from 122% of the monthly federal poverty level (FPL) for a family of two, and dividing by three. A dependent family member may be the couple's child (minor or adult), or a parent or sibling (including half-sibling, step-sibling, or adopted sibling), of either member of the couple. The dependent family member must have been living in the client's home before the client's absence, must continue to live with the community spouse, and must be unable to support himself outside the home because of medical, social, or other reasons. There must be a community-based spouse for there to be a dependent allowance. (2) The entire dependent allowance is deducted whether or not it is being made available to the dependent. (3) The spouse is permitted to appeal the allowance amount based on undue hardship caused by financial duress. Only hearing officers are allowed to set higher diversion amounts for cases of undue hardship. Cases of undue hardship are reviewed every six months to monitor changes in circumstances. (b) Effective September 30, 1989, Public Law 100-360 provides for the protection of resources for the community spouse when the other spouse is institutionalized. The resource provisions under this law apply to people with continuous periods of institutionalization beginning September 30, 1989. People living in nursing facilities on September 29, 1989, must be discharged for 30 consecutive days and readmitted before these special resource provisions apply. (1) When one spouse (in a couple) enters a Title-XIX-certified nursing facility or institution with the intention of remaining for 30 consecutive days, the couple may request an assessment of their combined countable resources. The purpose of the assessment is to determine a protected resource amount (PRA), which is that portion of total resources reserved for the community spouse and deducted from the couple's combined resources in determining eligibility. The assessment may be requested at any time from the date of institutionalization to the date of application for Medicaid, even if there are no plans to file an application. Therefore, an assessment may be completed months or years before the filing of an application. (2) The calculation of the protected resource amount occurs only once, as of the beginning of the first continuous period of institutionalization after September 30, 1989. If an individual transfers from an out-of-state facility to a Texas facility, the department determines the PRA as of the month of entry to the out- of-state facility. (3) The PRA is the greater of (A) one-half the couple's combined countable resources as of the month of admission to the institution but not to exceed the maximum as set by federal law; or (B) the minimum resource standard, as set by federal law. (4) The PRA is determined by using the minimum and maximum amounts for the time of initial institutionalization. The PRA determined at assessment is constant and does not change unless it was based on incomplete or inaccurate information. After the initial eligibility period (certification date to first annual review), only resources in the name of the institutionalized spouse are considered in the eligibility determination. (c) The department must complete an assessment of a couple's resources upon request of either spouse or either spouse's representative when one spouse is institutionalized with the intention of remaining for 30 consecutive days. Intent to remain is based on the statement of either spouse. Hospital stays and therapeutic home visits are not considered as breaks in the 30- consecutive-day period. (1) The couple's total countable resources, without regard to community/separate property laws or the spouses' respective ownership interests, are assessed as of 12:01 a.m. on the first day of the month in which the first continuous period of institutionalization on or after September 30, 1989, began. (2) Normal resource exclusions apply for assessment of resources and at initial application but not at annual review, except that the following are excluded regardless of value: (A) separately identifiable burial funds; (B) home; (C) household goods; and (D) one automobile. (3) The couple must provide requested verification of resources within 30 days of the request for assessment, or the request is void. The department must complete the assessment within 45 days after receipt of all verification requested. (4) An appeal is not allowed to be filed at the time of the assessment, but the PRA may be appealed when the MAO application is filed. (5) The department uses the minimum and maximum protected resource amounts in effect at the time of Medicaid application, not at the time of admission to the institution. (d) If an individual is found ineligible for Medicaid upon application, the department continues to deduct the same PRA for subsequent applications. (e) The PRA must not be deducted for people who are found eligible, who are certified, and who are subsequently denied. Only those resources in the name of the institutionalized spouse are considered at reapplication. (f) If a community spouse refuses to cooperate in furnishing information to establish a spousal PRA at the beginning of a continuous period of institutionalization, the department does not complete the assessment and does not take further action. No benefits are authorized, so no penalty is imposed. If an assessment is completed in conjunction with an eligibility determination, and a community spouse refuses to furnish information, the department determines the living arrangement before institutionalization. (1) If the couple was living in the same household, the department denies the application based on the couple's failure to furnish information. Living in the same household includes temporary separations. (2) If the couple is not living in the same household, the department determines the purpose of separation, the length of separation, and resources or income commingled or managed jointly by one member of the couple or a third party. (g) The department evaluates the information to determine if the separation occurred as a means of avoiding the pooling of resources under Medicaid spousal impoverishment provisions. The department considers if that Medicaid policy is being circumvented if: (1) separation occurred after a change in the health of the institutionalized spouse; (2) community spouse potentially owns separate resources; or (3) ownership of commingled resources were changed recently. (h) The couple has the right to rebut the assumption that the separation occurred to circumvent Medicaid policy. The rebuttal period is five workdays after oral notification (by the department to either spouse) and seven workdays after written notification. The institutionalized spouse, community spouse, or responsible party must provide written statements or evidence to substantiate the separation. If circumstances indicate there was no intent to circumvent Medicaid policy, the department treats the institutionalized spouse as an individual for consideration of resources, income, and applied income. sec.15.506. Mandatory Payroll Deductions from Earned Income. The department nets the client's and spouse's earned income each month by subtracting mandatory payroll deductions: (1) income tax; (2) Social Security tax; (3) required retirement withholding; and (4) required uniform expenses. This agency hereby certifies that the rule as adopted has been reviewed by legal counsel and found to be a valid exercise of the agency's legal authority. Issued in Austin, Texas, on September 26, 1991. TRD-9111865 Nancy Murphy Agency liaison, Policy and Document Support Texas Department of Human Services Effective date: September 30, 1989 For further information, please call: (512) 450-3765