GAB Decision 311
June 16, 1982 New York State Department of Social Services; Docket No.
81-217-NY-HC Garrett, Donald; Settle, Norval Ford, Cecilia
The New York State Department of Social Services appealed a decision
of the Health Care Financing Administration, disallowing $1,550,644 in
federal financial participation (FFP) claimed by the State under Title
XIX of the Social Security Act. The disallowance was based on a federal
audit which found that the State had not returned the federal share of
overpayments, to certain Medicaid providers, which had been firmly
established but not yet recovered by the State, and that the State had
returned the federal share of certain recovered overpayments at an
improper rate of FFP.
The major issues presented are 1) whether the Agency is precluded
from disallowing the federal share of these overpayments prior to the
State's recovery of the overpayments from the providers; and 2) whether
an agreement with the State binds the Agency to apply a 46 percent rate
of FFP to recovered overpayments.For reasons stated below and more fully
elaborated in previous Board decisions, we conclude that these
overpayments are not "medical assistance furnished under the State plan"
within the meaning of section 1903(d)(3) of the Act and, therefore, the
Agency may adjust for the overpayments prior to recovery. However,
under its agreement with the State, the Agency should have applied the
46 percent FFP rate. Accordingly, we reverse the disallowance in part,
sustain it in part, and remand it to the Agency to recalculate the
amount.
This decision is based on the parties' written submissions, including
supplemental briefs submitted at the Board's invitation.
The Federal Audit
The New York State Department of Social Services (DSS) is responsible
for administering the Medical program in the State of New York. Other
State agencies, including the Office of the Deputy Attorney General for
Medicaid Fraud Control (DAG), assist DSS in indentifying and recouping
Medicaid overpayments. The DAG was originally established to
investigate Medicaid fraud, patient abuse, and misconduct in the
operation of residential health care facilities. Its activities were
later expanded to include investigation of hospitals serving Medicare
and Medicaid patients, and, in 1978, the (2) DAG was designated as a
Medicaid Fraud Control Unit pursuant to Public Law 95-142.
The HHS Office of the Inspector General Audit Agency performed an
audit, reviewing the DAG's procedures for crediting the federal share of
the DAG collections. /1/ The review covered the period from January 10,
1975, when the DAG was established, until April 30, 1980. The auditors
found that, generally, the procedures used by the DAG and DSS to recoup
and report Medicaid overpayments identified by the DAG were adequate.
The auditors found, however, that DSS was not crediting the federal
share of Medicaid overpayments to quarterly expenditure reports until
after the overpayments were actually recovered from the providers.
Specifically, the auditors found:
As of March 31, 1980, there were 86 providers, of approximately 300
with identified Medicaid overpayments, for which firm repayment amounts
had been established by the DAG. These providers, about 90 percent of
them nursing homes, were required to repay in accordance with the terms
of a signed (stipulation) agreement, through court ordered restitution,
or via a surrender of Medicaid claims to DSS. Each of these repayment
mechanisms reflected formal recognition and acceptance by the DAG and
the affected providers of amounts to be repaid. As of March 31, 1980,
of the 86 providers, 29 had not yet repaid $2,570,996 . . . of their
Medicaid overpayment amounts to the DAG.
Audit Report, p. 8.
The auditors determined, using a method which will be discussed
below, that the federal share of these unrecovered overpayments was
$1,274,865.
In addition, the auditors found that the percentage at which the
State was crediting federal expenditure reports for Medicaid
overpayments recovered from nursing homes (46 percent) was too low.
According to the auditors, the State should have computed the federal
share to be 49.72 percent of the payments. If the State had used this
percentage, the auditors determined, this would have resulted in the
return of an additional $275,779 in federal funds. (3) Based on these
audit findings, the Agency disallowed $1,550,644 in FFP ($1,274,865 plus
$275,779). On appeal, the State's major arguments were that 1) the
Agency was precluded from disallowing the $1,274,865 since the State had
not yet recovered that amount from the providers; and 2) the Agency had
an agreement with the State which bound the Agency to applly the 46
percent rate for determining the federal share of overpayments.
Discussion
I. Whether the Agency is precluded from disallowing these payments
prior to recovery.
Section 1903(d)(1) of the Act requires the Secretary to estimate the
amount of Medicaid funding to which a state will be entitled, prior to
the beginning of each quarter. Section 1903(d)(2) requires the
Secretary to pay the amount so estimated, "reduced or increased to the
extent of any overpayment or underpayment which the Secretary determines
was made . . . for any prior quarter . . . ." As discussed more fully in
previous Board decisions, the Agency has consistently interpreted the
term "overpayment" in section 1903(d)(2) to include any payments made
to
a state and later determined by the Secretary to be unallowable, that
is, not in accordance with federal program requirements. Massachusetts
Department of Public Welfare, Decision No. 262, February 26, 1982;
Florida Department of Health and Rehabilitative Services, Decision No.
296, May 13, 1982; see, also, California Department of Health Services,
Decision No. 244, December 31, 1981; New York State Department of
Social Services, Decision No. 284, April 29, 1982. In these cases, the
Board upheld the Agency interpretation.
The State did not deny here that the 29 providers were paid in excess
of what they were entitled to under the program. Indeed, the State
itself investigagted the providers, identified certain amounts as
"overpayments," established the final amounts through court proceedings
or settlements, and instituted recovery procedures.The State argued,
however, that adjustment of the federal share prior to recovery from the
providers violated section 1903(d)(3) of the Act and was contrary to the
general purposes of the Medicaid program and the partnership
relationship between the states and the federal government. The State
also argued that its position was supported by a regulatory definition
of "recoveries" and that Agency policies concerning the matter had
been
inconsistent. These arguments are discussed below. (4) A. Whether the
Agency interpretation of section 1903(d)(3) is correct.
The State relied primarily on section 1903(d)(3) of the Act. That
section provides:
The pro rata share to which the United States is equitably entitled,
as determined by the Secretary, of the net amount recovered during any
quarter by the State or any political subdivision thereof with respect
to medical assistance furnished under the State plan shall be considered
an overpayment to be adjusted under this subsection.
(emphasis added)
The affect of this section has also been discussed in numerous Board
decisions. In Massachusetts, cited above, we considered the effect of
this section on excess payments to providers resulting from payment at
an interim rate of reimbursement which was higher than the final rate
established through Massachusett's rate-setting system. There, we
upheld the Agency interpretation that section 1903(d)(3) does not
preclude the Agency from adjusting prior to recovery where it has made a
supportable determination that FFP has been paid for unallowable costs.
In summary, we based the Massachusetts holding on the following reasons:
-- Section 1903(d)(3) does not by its terms relate back to all
overpayments contemplated by section 1903(d)(2).
-- Since 1903(d)(3) refers to amounts recovered with respect to
"medical assistance furnished under the State plan," it reasonably
may
be viewed as referring only to state payments which are allowable
"medical assistance" costs, under section 1905(a) of the Act.
-- The legislative history supports the Agency's position that
section 1903(d)(3) was designed to authorize the Secretary to adjust in
situations where a question might have existed as to a state's liability
to repay the federal share or the (5) Agency's ability to recoup the
share by an offset to future claims. /2/
-- Neither the Agency nor the courts have ever interpreted section
1903(d)(3) to prevent adjustment under section 1903(d)(2) of an amount
determined by the Secretary to be an overpayment, merely because the
state has not recovered the amount from a provider.
New York's arguments do not persuade us that a different result is
required here.
First, the State relied on principles of statutory construction,
arguing that, since paragraph (3) "deals with a narrow, precise and
specific subject (i.e. recovery of overpayments)," it cannot be
controlled by the general provisions of paragraph (2). The flaw in this
argument is that the specific subject of (d)(3) is not "recovery of
overpayments" as the State alleged, but treatment of certain recoveries
as overpayments. The plain language of (d)(3) concerns amounts which
would not ordinarily be considered "overpayments" because they were
"medical assistance furnished under the State plan" and, therefore,
were
allowable when made. /3/ When such amounts are (6) recovered, (d)(3)
describes the extent to which the federal share is to "be considered an
overpayment" for purposes of adjustment under (d)(2). Thus, (d)(3) does
not constitute a limiting definition of the term "overpayment" in
(d)(2). Contrary to the State's assertion, the Agency interpretation
does not render (d)(3) superfluous, ineffective, or insignificant, but,
rather, gives effect to both provisons and is supported by the statutory
scheme as a whole.
The State attempted to distinguish this case from those decided in
our Massachusetts and California decisions, cited above, on the basis
that New York's system for reimbursing providers differed from that of
Massachusetts and California. Unlike those states, which employ a
"retrospective" system under which they pay providers at an "interim"
rate of reimbursement and later establish a final rate, New York has a
"prospective" reimbursement system under which it pays at an "initial"
rate which is considered final. According to New York, payments at this
"initial" rate are, therefore, "medical assistance furnished
under the
State plan" within the meaning of 1903(d)(3), even though the initial
rate is subject to retroactive downward adjustment if originally set
higher than the State plan allows.
The Broad has already addressed the question of whether overpayments
made under a prospective reimbursement system have a status which is
different from overpayments under a retrospective system of
reimbursement. Florida Department of Health and Rehabilitative
Services, Decision No. 296, May 13, 1982, pp. 7-8; see, also, New York
Department of Social Service, Decision No. 302, May 28, 1982. We
concluded that excess payments arising from either system have the same
status: they are amounts paid to a provider in excess of what the
provider was ultimately entitled to under the state plan. New York has
presented nothing which would lead us to conclude that this analysis
does not also apply to excess payments made to a New York provider
because an initial rate was higher than the rate ultimately determined
to be proper under the State plan.
Moreover, even if we were persuaded that overpayments determined
after rate adjustments in a prospective reimbursement system were not
comparable to overpayments under a retrospective system, there is
nothing in the record to indicate that the overpayments here involve
rate adjustments. The DAG's identification of overpayments was
primarily related to fraud and abuse activities. Audit Report, p. 1-2;
see, also, 42 CFR 455.300 (1978). While it is possible that some of the
overpayments identified by the DAG arose because of misreporting of a
provider's costs used to establish a rate, the overpayments could have
been attributable to claims for services which were not performed or
which were provided to ineligible recipients. Such payments would
clearly be unallowable as "medical assistance" costs. See, section
1905(a)of the Act.
(7) B. Whether the Agency position is contrary to the "spirit" of
the program.
The State argued that the Agency position would result in states
bearing the full financial burden of uncollectible overpayments and this
would be contrary to the "spirit" of the Medicaid program. The argument
was based on the concept that Medicaid is a partnership between the
states and federal government and that it involves a system of funding
the states on an advance basis.
We do not think these general concepts provide a basis for adopting
the State's strained reading of section 1903(d)(3), particularly where
the Agency position is consistent with statutory provisions specifying
the costs in which FFP will be available. Moreover, while it is true
that Congress devised the Medicaid program as a joint federal-state
endeavor, the states have the primary responsibility for administering
the program, including the duty to take steps to prevent improper
payments in the first instance and to identify and recover overpayments
in a timely manner when they do occur. In some instances the loss of
funds might be unavoidable. However, to sort out these cases would be
difficult, requiring a highly judgmental case-by-case analysis. Viewing
the program as a whole, therefore, we think that the Agency is not
unreasonable in requiring the states to bear the burden of unrecovered
overpayments.
The State further argued, however, that requiring the states to bear
this burden would provide a disincentive for overpayment recovery
activities and make it more difficult for the states to enter into
installment payment plans with providers. The State contended that this
result would be inconsistent with Congressional intent, as evidenced by
increased funding for Medicaid Fraud Control Units, to encourage
provider recovery efforts by the states.
The Agency policy could conceivably make states more reluctant to
enter into installment payment plans with providers, even though in some
circumstances this is a reasonable method of obtaining the maximum
recovery. On the other hand, we do not think that the policy would
substantially impact recovery efforts, since, as the State recognized,
some efforts are mandated by statute and regulation. Indeed, the policy
might provide an incentive for states to identify and recoup
overpayments in a more timely manner. More important, however, the
State's position fails to take into account the clear Congressional
intent to deny funding for unallowable costs. The matter of how this
intent is reconciled with the goal of encouraging states to identify and
recover overpayments is a policy question, which the Agency has resolved
in a reasonable manner.
(8) C. Whether current regulations are consistent with the Agency
position.
We also think that the State's reliance on the recently promulgated
regulation at 42 CFR 433.203 (46 Fed. Reg. 48001, September 30, 1981) is
misplaced.
This regulation defines "recoveries" as "Medicaid funds a provider
of
services has been paid in excess of amounts payable under title XIX of
the Act, applicable regulations and the State plan that are actually
collected or diverted by a State agency or Medicaid Fraud Control Unit,
and which have been reported to the Federal Government." The State
contended that this regulation defined "overpayment recoveries" and,
since that term is not defined elsewhere, supports the State's position
that there can be no adjustment for an overpayment prior to actual
collection or diversion by the State.
We disagree. To the extent the regulation can be read as a
definition of an overpayment (which could be adjusted under 1903(d)(
2)), it is consistent with the Agency view that any payment in excess of
the amount payable under applicable program requirements constitutes an
overpayment. Moreover, nothing in the regulation precludes the Agency
from auditing, determining that an excess payment was made, and
disallowing the federal share of any amount which has not been
recovered. In context, the regulation merely describes what constitute
fraud and abuse "recoveries" for the limited purpose of determining
whether a state qualifies for an offset to a reduction in Medicaid
funding, otherwise required by Public Law 97-35 for fiscal years
1982-1984. Thus, it does not limit the Agency's authority to adjust for
overpayments prior to recovery.
D. Whether Agency policy has been consistent.
In Massachusetts, the Agency alleged that its interpretation of the
relationship of section 1903(d)(2) and (d)(3) of the Act had been
consistently applied for sixteen years in its regulations and fiscal
procedures. We noted in our decision that Massachusetts did not dispute
this claim. Although arguing here that Agency policy had not been
consistent, New York did not cite to any Agency policy statement setting
out an interpretation that adjustment of the federal share of payments
determined by the Agency to be unallowable was contingent on collection.
Instead, New York relied primarily on statements made in a report issued
by the United States General Accounting Office (HRD-80-77), Appeal file,
Exhibit IV. Specifically, the State cited to page 2 of the report,
which states:
HCFA had not established consistent policies and guidelines for
States to use in administering overpayment
(9) recovery activities. Also, HCFA did not have a clear policy
explaining when and under what circumstances Federal financial
participation in outstanding overpayment would be denied.
We think the State's reliance on this report is misplaced. The
statement concerning a lack of consistent policies relates to state
administration of overpayment recovery activities, which is not at issue
here. With respect to Agency policy governing denial of FFP in
outstanding overpayments, the General Accounting Office (GAO) report
merely states that the policy is not clear as to the timing and
circumstaces of such denial.
As we have discussed in previous Board decisions, any consideration
of Agency policy in this area must recognize legitimate differences in
treatment of various kinds of Medicaid "overpayments," and reasons
why
the Agency might wait for recovery, allow a reasonable time for
recovery, or require immediate adjustment. Florida, cited above, at p.
12.; New York, Decision No. 284, cited above, at pp. 7-8. The GAO
report covered a broad range of overpayments, and we do not think it
considered these differences.
Regarding the specific situation here, where the Agency itself has
determined through an audit that FFP has been claimed by the State for
improper provider payments, the clear Agency policy has been to disallow
the costs and to require the state to adjust immediately (or on an
installment plan) when the disallowance decision is final. See 45 CFR
201.14(e)(1977-1981); 45 CFR 201.66 (1977-1981); State of Georgia v.
Califano, 446 F. Supp. 404 (N.D. Ga. 1977). Although a number of states
have argued before the Board that the Agency should wait until recovery
before disallowing, no state has called to Board attention any instance
in which the Agency construed its disallowance authority to be
contingent on recovery.
Accordingly, we conclude that the disallowance for unrecovered
provider overpayments firmly established by the DAG should be upheld.
As discussed below, however, the federal share of the overpayments
should re recomputed. We also note that, according to the audit report
at page 9, the providers had installment payment plans under which they
"were eventually repaying the DAG in accordance with established
schedules . . . ." The auditors further found that the DSS was properly
returning the federal share by crediting quarterly expenditure reports.
Since the auditors' findings only reflected collections made as of March
31, 1980, it is possible that some of the amounts in dispute here have
already been repaid and the federal share returned. Thus, to avoid a
duplicate adustment, the Agency should give the State a reasonable
opportunity to show that it has already adjusted for some of the
overpayments covered here.
(10) II. Whether the Agency was bound to apply a 46 percent rate of
FFP to recovered overpayments.
A. The parties' agreement and the auditors' findings
In a letter dated April 6, 1977, the Commissioner of DSS wrote to the
Regional Commissioner of the Social and Rehabilitation Service (SRS),
then responsible for administering the Medicaid program. Appeal file,
Exhibit I. The letter discussed negotiations between DSS and SRS staff,
concerning the method to be used to compute the federal share of monies
recovered through fraud and abuse activities. The letter stated that it
had been tentatively agreed that the fairest method was to apply "QER
Medicaid percentages" from a three year base period and requested
approval from the Regional Commissioner for the percentages determined
on that basis, identifying 46.75 percent as the federal share.
The Regional Commissioner's response, dated April 20, 1977, stated:
My staff has reviewed the distribution factors noted and we find they
are accurate. We agree that this represents the fairest method of
establishing the appropriate Federal share. In cases where the actual
amount can be identified, we do expect that recoupments will be made on
that basis. We were also advised by your staff that the distribution
percentages will be updated annually to reflect revisions that may have
occurred.
Appeal file, Exhibit II.
In their review of the collections made by the DAG, the auditors
found that DSS was crediting the federal share of the collections at 46
percent. The auditors also found that over 99 percent of the
collections made by the DAG from January 10, 1975 to March 31, 1980 were
related to Medicaid overpayments to nursing homes. Based on this, the
auditors concluded:
Since we could specifically identify the vast majority of collections
with nursing homes, it is our opinion that the Federal government should
have received its share of recoupments using the effective Federal
Financial Participation (FFP) rate for nursing homes. For the two year
period from January 1, 1978, to December 1979, 99.44 percent of the
Medicaid expenditures were eligible for FFP at a rate of 50 percent.
Based on these figures, we computed the effective FFP rate related to
nursing homes to be 49.72 percent.
(11) The disallowance of $275,779 in this case represents the
difference between the rate used by the State and the 49.72 percent rate
found by the auditors, as applied to the nursing home recoveries. /4/
In addition, the federal share of the $2,570,996 in unrecovered
overpayments found by the auditors was determined by applying the 49.72
percent rate to the amount to be repaid by nursing homes and applying
the DSS percent being used for the calendar year 1980 to the amount to
be repaid by non-nursing home providers. Audit Report, p. 8, note 1.
B. The parties' interpretation of the agreement
In response to the audit report and on appeal, the State argued that
it had calculated the 46 percent rate in accordance with its agreement
with the Regional Commissioner, by determining the average rate of FFP
in New York's Medicaid program during a three year base period. /5/
The Agency did not contend that the Regional Commissioner did not
have the authority to bind the Agency to accept the rate established
under the agreement. According to the Agency, however, application of
the 49.72 rate to nursing homes, a specific category of cases, was
consistent with the agreement.The Agency pointed to qualifying language
in the agreement concerning "cases where the actual amount can be
identified," arguing that it had met this criteria by identifying the
payments to the nursing home category. The State's interpretation of
this language, however, is that it requires "case-specific"
identification (i.e. identification of the specific recipient involved),
rather than "category-specific" identification.
(12) C. Discussion
We agree with the State.The Agency acknowledged that the purpose of
the agreement was to avoid the "administrative nightmare" of tracing
the
recovered money back to the specific individuals, on whose behalf they
were first expended, to determine whether they were federally eligible
or not. Agency brief, p. 2. Given the administrative infeasibility of
identifying the precise federal share of recovered overpayments, the
Agency agreed that the State's method would be a fair way to establish
the federal share. The State's method involves an averaging process
based on the underlying premise that, although in any one instance one
party might benefit, in the long run this would average out so that
neither party would unduly benefit. As the State has pointed out,
treating a substantial portion of the overpayments in a different
manner, as the auditors did here, skews the entire distribution process.
Since nursing home payments, with their higher federal share, were
included in the computation of the average, separating them out is
inconsistent with the premise of the agreement and could prejudice the
State.
Moreover, the qualifying language of the agreement speaks of "cases
where the actual amount can be identified." While using
category-specific identification might be a more accurate method of
determining the federal share, it only identifies a more likely amount,
not the actual amount, of federal dollars involved.
The Agency argued that the qualifying language could not logically
have meant case-specific identification, since case-specific
identification was "impossible." We do not think, however, that merely
because something is administratively difficult, it would be impossible.
There may indeed be some instances where overpayments can be readily
identified to a particular recipient, and, given the context in which
the agreement was drafted, we conclude that the qualifying language was
intended to cover these instances.
The Agency submitted nothing in support of its position except an
affidavit by an Agency official familiar with the circumstances
surrounding the parties' exchange of letters. Agency brief, Exhibit A.
This affidavit does not address the question of how to imterpret the
qualifyig language although that language was drafted by Agency
officials. The primary point made by the affiant is that the agreement,
although it speaks of "fraud and abuse" recoveries, was intended to
cover all recoupments generated by various State investigative and
administrative agencies. The State does not dispute that this was the
scope of the agreement and, in fact, this factor supports the State's
position. If the agreement were limited to the DAG's fraud and abuse
activities, and 99 percent of those activities related to nursing homes,
there would be a substantial question as to whether the State's
(13) method of using the average for all categories of payments did
fairly establish the federal share and was consistent with statutory
intent of providing federal funding only for services to federally
eligible individuals. Since the agreement covered a broad range of
overpayment recovery activities, however, it may be that any
underrecovery of federal funds related to DAG activities is compensated
for by over-recovery in other areas. The Agency made no finding that
overpayment recoveries as a whole were related to nursing homes in such
a high proportion as to make the State's method unfair. Given this, we
do not adopt the Agency's suggestion that the agreement should be
reformed.
We also note that, although identifying providers by category might
have been a more accurate way of determining the federal share, the
Agency agreed to the State's method. To require the State to go back at
this point in time to identify all overpayments by provider category
would be more burdensome than if it had been required in the first
instance. In view of this, and given the fact that the Agency has not
shown that the State's method results in an underrecovery of federal
funds, we think that the Agency was bound to apply the 46 percent rate.
Accordingly, we reverse the disallowance of the $275,799. We also
reverse the disallowance of the unrecovered overpayments to the extent
it was calculated using the auditors' method rather than applying a
percentage in accordance with the agreement.
Conclusion
For the reasons stated above, we sustain the disallowance in part and
reverse the disallowance in part, remanding to the Agency to recalculate
the amount in accordance with our decision. /1/ "Report on Review of
Credits Due the Federal Government Under the Medical Assistance
Program Resulting From Audits and Investigations of The Deputy Attorney
General for Medicaid Fraud Control," ACN 02-10253 (Audit Report);
Appeal file, Exhibit V. /2/ While the legislative history of section
1903(d) does not explicitly explain the relationship of (d)(2) and
(d)(3), it does state that the provisions of section 1903(d) are similar
to those "under the existing public assistance titles of the act."
H.R.
REP. 213, 89th Cong., 1st Sess. 188 (1964). The legislative history of
the comparable provisons shows that the purpose was to treat recoveries
of certain otherwise allowable costs as overpayments in order to permit
the federal share to be recouped through an offset against the state's
next award of funds. See, H.R. REP. 728, 76th Cong., 1st Sess. 29, 33,
56, 75-76 (1939); see, also, Message of the President of the United
States transmitting Report of the Social Security Board recommending
changes in the Social Security Act, 76th Cong., 1st Sess., Document No.
110; House Committee on Ways and Means, Hearings relative to Social
Security Act Amendments of 1936; 76th Cong., 1st Sess., Vol. 3,
2412-2417. /3/ Thus, we note, the Agency has used section 1903(d)(3) to
recoup the federal share of amounts which were proper expenditures under
a state plan, but which have been recovered by a state. The rationale
used in addition to the provision at 1903(d)(3) is that the recovery
constitutes an applicable credit to the grant program because it acts,
in effect, to reduce program expenditures. See, New York Department of
Social Services, Decision No. 261, February 26, 1982; Montana Department
of Social and Rehabilitation Services, Decision No. 309, June 7, 1982.
/4/ The auditors explained that the $275,779 "represents 49.72 percent
of the DAG collections related to nursing homes ($7,262,867) plus either
45.9 or 46 (the applicable DSS) percent of non-nursing home collections
($60,043), or $3,638,667, minus $3,362,888, the Federal share of DAG
collections as reported by DSS on the quarterly expenditure reports as
of March 31, 1980." Audit Report, p. 14, note 1. /5/ The Agency
did not dispute the State's contention that 46 percent represented the
average rate although the agreement specifies 46.75 percent. Presumably
the 46 percent is an updated figure applicable to the time period in
question. If not, our decision would not preclude the Agency from
determining that the State's application of a 46 percent rate violated
the agreement and should result in a new disallowance.
OCTOBER 22, 1983