B-318866

November 6, 2009

The Honorable MaxBaucus
Chairman
The Honorable Charles E. Grassley
Ranking Minority Member
Committee on Finance
United States Senate

The Honorable Charles B.Rangel
Chairman
The Honorable Dave Camp
Ranking Minority Member
Committee on Ways and Means
House of Representatives

Subject: Department of Health and Human Services, Centers for Medicare andMedicaid Services: Medicare Program; Part A Premium for Calendar Year 2010 forthe Uninsured Aged and for Certain Disabled Individuals Who Have ExhaustedOther Entitlement

Pursuant to section801(a)(2)(A) of title 5, United States Code, this is our report on a major rulepromulgated by the Department of Health and Human Services, Centers forMedicare and Medicaid Services (CMS), entitled "Medicare Program; Part A Premium for Calendar Year 2010for the Uninsured Aged and for Certain Disabled Individuals Who Have ExhaustedOther Entitlement" (RIN: 0938-AP43). Wereceived the rule on October 19, 2009.It was published in the FederalRegister as a notice on October 22, 2009.74 Fed. Reg. 54,581.

The notice announces Medicare Hospital Insurance (Part A)premium for uninsured enrollees in calendar year (CY) 2010. This premium is paid by enrollees age 65 andover who are not otherwise eligible for benefits under Medicare Part A and bycertain disabled individuals who have exhausted other entitlement. The monthly Part A premium for the 12 monthsbeginning January 1, 2010, for these individuals will be $461. The reduced premium for certain otherindividuals who qualify for a reduction of 45 percent will be $254.

Enclosed is our assessment of the CMS's compliance withthe procedural steps required by section 801(a)(1)(B)(i) through (iv) of title5 with respect to the rule. Our reviewof the procedural steps taken indicates that CMS complied with the applicablerequirements.

If you have any questions about this report or wish tocontact GAO officials responsible for the evaluation work relating to thesubject matter of the rule, please contact Shirley A. Jones, Assistant GeneralCounsel, at (202) 512-8156.

signed

Robert J. Cramer
Managing Associate General Counsel

Enclosure

cc: VivianStallion
Office Manager, Department of
Health and Human Services

ENCLOSURE

REPORT UNDER 5 U.S.C. sect.801(a)(2)(A) ON A MAJORRULE
ISSUED BY THE
DEPARTMENT OF HEALTH AND HUMAN SERVICES,
CENTERS FOR MEDICARE AND MEDICAID SERVICES
ENTITLED
"MEDICARE PROGRAM; PART A PREMIUM FOR
CALENDAR YEAR 2010 FOR THE UNINSURED AGED
AND FOR CERTAIN DISABLED INDIVIDUALS
WHO HAVE EXHAUSTED OTHER ENTITLEMENT"
(RIN: 0938-AP43)

(i) Cost-benefit analysis

For calendar year (CY) 2010, CMS estimates that theaggregate cost to enrollees paying the premiums will be about $125 million morethan the amount they paid in CY 2009.The premium for CY 2010 of $461 is an increase of approximately 4percent over the CY 2009 premium of $443.CMS estimates that approximately 558,000 enrollees will voluntarilyenroll in Medicare Part A by paying the full premium and that an additional40,000 enrollees will pay the reduced premium.

(ii) Agency actions relevant to the RegulatoryFlexibility Act, 5 U.S.C. sections603-605, 607, and 609

CMS has determined the notice will not have a significanteconomic impact on a substantial number of small entities or on the operationsof a substantial number of small rural entities. Therefore, CMS did not prepare an analysisunder the Regulatory Flexibility Act.

(iii) Agency actions relevant to sections 202-205 ofthe Unfunded Mandates Reform Act of 1995, 2 U.S.C. sections1532-1535

CMS has determined that the notice has no consequentialeffect on state, local, or tribal governments, or on the private sector. However, states are required to pay thepremiums for dually-eligible beneficiaries.

(iv) Other relevant information or requirements underacts and executive orders

Administrative Procedure Act, 5 U.S.C. sections551 etseq.

CMS issued a general notice and waived notice and commentrulemaking because the premium is dictated by a statutory formula.

Paperwork Reduction Act, 44U.S.C. sections3501-3520

The notice does not addressthe Paperwork Reduction Act. However, inpast annual notices announcing these rates, CMS has stated that the notice doesnot contain any information collection requirements subject to the Act.

Statutory authorization for the rule

The notice was issued pursuant to the authority containedin section 1818 of the Social Security Act (42 U.S.C. 1395i-2).

Executive Order No. 12,866 (Regulatory Planning and Review)

The notice was deemed economically significant under theOrder because the total increase in costs to voluntary enrollees associatedwith the notice will be about $125 million.The notice was reviewed by the Office of Management and Budget.

Executive Order No. 13,132 (Federalism)

CMS determined that the notice does not have federalismimplications.