CABINET FOR HEALTH AND FAMILY SERVICES

Department for Public Health

Division of Maternal and Child Health

(New Administrative Regulation)

902 KAR 18:010. Definitions for 902 KAR Chapter 18.

      RELATES TO: KRS Chapter 13B, 194A.050, 194A.505, 194A.990, 7 C.F.R. Part 246, 7 C.F.R. Part 278.6, 21 U.S.C. 802 sec. 102

      STATUTORY AUTHORITY: KRS 194A.050, 211.090(3), 7 C.F.R. Part 246, 42 U.S.C. 1786

      NECESSITY, FUNCTION, AND CONFORMITY: 42 U.S.C. 1786 and 7 C.F.R. Part 246, provide for grants for state operation of the Special Supplemental Nutrition Program for Women, Infants and Children (WIC). KRS 194A.050(1) authorizes the Cabinet for Health and Family Services to promulgate administrative regulations as necessary to qualify for the receipt of federal funds. This administrative regulation establishes definitions for the terms used in 902 KAR Chapter 18.

      Section 1. Definitions. (1) "Above-50-Percent vendor" means a vendor that receives or is expected to receive more than fifty (50) percent of its annual food sales revenue from WIC benefits.

      (2) "Alcohol" is defined in KRS 241.010(1).

      (3) "Alcoholic beverage" is defined in KRS 241.010(2).

      (4) "Approved Product Listing" or "APL" means an electronic list (file) identifying the food items approved by the State WIC Agency for purchase with WIC benefits by food category and subcategory.

      (5) "Authorized Supplemental Food" means a supplemental food authorized by the state or a local agency for issuance to a particular participant.

      (6) "Cash Value Benefit" means a fixed-dollar amount check, food instrument, electronic benefits transfer (eWIC) card or other document which is used by a participant to obtain authorized fruits and vegetables.

      (7) "Cash Value Voucher" as defined by 7 C.F.R., Part 246.2, means a fixed-dollar amount check, voucher, electronic benefit transfer (EBT) card or other document which is used by a participant to obtain authorized fruits and vegetables.

      (8) "Certifying Professional Authority" means a person authorized to determine eligibility and certify persons for the WIC Program.

      (9) "Compliance Buy" means a covert, on-site investigation.

      (10) "Contract price" means the price for a WIC food item negotiated between the state agency and the vendor.

      (11) "Dual participation" means simultaneous participation in the WIC Program and in:

      (a) One (1) or more WIC clinics; or

      (b) The Commodity Supplemental Food Program.

      (12) "Electronic WIC benefits" or "eWIC" means a Web-based technology that allows WIC participants to obtain food benefits by using a plastic debit-type card with a Personal Identification Number (PIN) at authorized participating WIC retailers.

      (13) "FNS" means Food and Nutrition Services.

      (14) "Food Instrument" as defined by 7 C.F.R., Part 246.1, means a voucher, check, electronic benefits transfer card (EBT), coupon or other document which is used by a participant to obtain supplemental foods.

      (15) "High Risk Vendor" means a vendor having a high probability of noncompliance with federal and state regulations, policies, and procedures.

      (16) "Integrated" means a commercial system that fully incorporates eWIC functionality into an existing cash register (ECR) system.

      (17) "Inventory Audit" means an examination of food invoices or other proofs of purchase to determine if a vendor has purchased sufficient quantities of authorized supplemental food to provide to participants the quantities specified on WIC benefits redeemed by the vendor during a given period of time.

      (18) "Investigation" means a method used by the state agency to detect a WIC Program violation.

      (19) "Local Agency" is defined as an applying or participating WIC agency.

      (20) "Low variance" means the redemption of the same type of food item at the same price, or within a narrow price range.

      (21) "Negotiated Price" means the price for a WIC food item negotiated between the state WIC Agency and the vendor.

      (22) "Not to Exceed" or "NTE" means a FNS-approved cost containment methodology whereby WIC authorized vendors are subject to price limitations.

      (23) "Participant" means:

      (a) A pregnant, breastfeeding, or postpartum woman, or an infant or child, who is receiving supplemental food or WIC benefits;

      (b) The breastfed infant of a breastfeeding woman who is receiving WIC Program benefits;

      (c) The parent or caretaker of an infant or child receiving a WIC benefit; and

      (d) The proxy for a person identified in paragraphs (a), (b), or (c) of this subsection.

      (24) "Participant Violation" means an intentional, knowing act of a participant, as defined in this administrative regulation, that violates federal or state law governing the WIC Program.

      (25) "Peer Groups" means categories into which vendors are assigned based upon sales volume and region.

      (26) "Point of Sale" or "POS" means the system supporting WIC/eWIC food sales in a store checkout lane.

      (27) ."POS Device" means a physical electronic cash register or dedicated Point of Sale hardware (or "terminal) that is used for WIC processing.

      (28) "Positive Buy" means a compliance buy, on-site review, or on-line WIC transaction review in which evidence of a sanctionable violation of the Vendor Agreement, program policies, and/or rules is obtained

      (29) "Price Look Up" or "PLU" means a four (4) or five (5) digit identifier used to identify individual and bulk produce.

      (30) "Proxy" means as a person designated by a female participant, or by a parent or caretaker of an infant or child participant, to obtain and transact a food instrument/cash value benefit to obtain a supplemental food or foods on behalf of a participant.

      (31) "Routine monitoring" means an overt, on-site monitoring during which representatives of the WIC Program identify himself or herself to vendor personnel.

      (32) "Rural" means any area not defined by subsection (42) of this section.

      (33) "Shelf Price" means the price displayed on the food item, shelf, or display case where the food item is stored.

      (34) "SNAP" means "Supplemental Nutrition Assistance Program", formally known as the Food Stamp Program.

      (35) "Standard Bar Code" means a series of lines of varying width, printed, as on a container or product, that can be read by an optical scanner to determine product classification, price, etc.

      (36) "Staple food items" means meat, poultry, fish, bread, breadstuff, cereals, vegetables, fruit, vegetable and fruit juices, and dairy products, excluding items such as coffee, tea, cocoa, carbonated and uncarbonated beverages, condiments, and spices.

      (37) "State WIC Agency" means the Cabinet for Health and Family Services or its designated representative.

      (38) "Systematic Review" means a review of electronic WIC transactions by the state WIC agency or its representatives to monitor systematic abuses at POS terminals.

      (39) "Trafficking" means the redemption of WIC benefits for cash, for firearm, ammunition, an explosive, or controlled substance as defined in 21 U.S.C. 802.

      (40) "Unauthorized Food" means foods not authorized by the state or local agency for issuance to a particular participant.

      (41) "UPC" means a barcode consisting of twelve (12) digits used for tracking trade items in retail stores.

      (42) "Urban" means the metropolitan area as defined by US Office of Management and Budget.

      (43) "Vendor" means a sole proprietorship, partnership, cooperative association, corporation, or other business entity operating one (1) or more stores to participate by providing authorized supplemental foods to participants under a retail food delivery system.

      (44) "Vendor authorization" means the process by which the state WIC agency enters into an agreement or contract with a store that applies to be authorized as a vendor.

      (45) "Vendor Overcharge" as defined by 7 C.F.R., Part 246.2, means intentionally or unintentionally charging the state agency more for authorized supplemental foods than is permitted under the vendor agreement.

      (46) "Vendor Violation" means an intentional or unintentional act of a vendor’s current owner, officers, agent, or employee, with or without the knowledge of management, that violates the vendor agreement or either the federal or state law governing the WIC Program.

      (47) "WIC Agency" is a local health department or agency contracted with the state to deliver WIC services.

      (48) "WIC Benefits" means a voucher, check, electronic benefits transfer card (EBT), coupon, or documents that is used by a participant to obtain supplemental foods.

      (49) "WIC Eligible Medical Foods" means enteral products that are specifically formulated to provide nutritional support for individuals with a qualifying condition when the use of conventional foods is precluded, restricted or inadequate.

      (50) "WIC Program" or "WIC" means the Special Supplemental Nutrition Program for Women, Infants, and Children authorized by Section 17 of the Child Nutrition Act of 1966, 42 U.S.C. 1786, and administered pursuant to 42 U.S.C. 1786 and 7 C.F.R. Part 246.

STEVE DAVIS, M.D., Acting Commissioner

AUDREY TAYSE HAYNES, Secretary

      APPROVED BY AGENCY: December 13, 2012

      FILED WITH LRC: December 14, 2012 at 9 a.m.

      PUBLIC HEARING AND PUBLIC COMMENT PERIOD: A public hearing on this administrative regulation shall, if requested, be held on January 22, 2013 at 9:00 a.m. in Suite C. Individuals interested in attending this hearing shall notify this agency in writing by January 14, 2013, five (5) workdays prior to the hearing, of their intent to attend. If no notification of intent to attend the hearing is received by that date, the hearing may be canceled. The hearing is open to the public. Any person who attends will be given an opportunity to comment on the proposed administrative regulation. A transcript of the public hearing will not be made unless a written request for a transcript is made. If you do not wish to attend the public hearing, you may submit written comments on the proposed administrative regulation. You may submit written comments regarding this proposed administrative regulation until close of business January 31, 2013. Send written notification of intent to attend the public hearing or written comments on the proposed administrative regulation to:

      CONTACT PERSON: Jill Brown, Office of Legal Services, 275 East Main Street 5 W-B, Frankfort, Kentucky 40601, phone 502-564-7905, fax 502-564-7573.

REGULATORY IMPACT ANALYSIS AND TIERING STATEMENT

Contact Person: Carlene Egbert 564-3827 x 3840

      (1) Provide a brief summary of:

      (a) What this administrative regulation does: This administrative regulation establishes the definitions for a new chapter of administrative regulations that establishes and implements the application and participation process for the Kentucky Special Supplemental Nutrition Program for Women, Infants and Children (WIC) for women, infants, children, and vendors.

      (b) The necessity of this administrative regulation: KRS 194A.050(1) authorizes the Cabinet for Health and Family Services to promulgate administrative regulations as necessary to qualify for the receipt of federal funds. This administrative regulation establishes the definitions for 902 KAR Chapter 18.

      (c) How this administrative regulation conforms to the content of the authorizing statutes: The Cabinet has responsibility under KRS 194A.050 to promulgate, administer, and enforce those administrative regulations necessary to implement programs mandated by federal law, or to qualify for the receipt of federal funds. This administrative regulation establishes the definitions for 902 KAR Chapter 18

      (d) How this administrative regulation currently assists or will assist in the effective administration of the statutes: This regulation will provide the definitions used in Chapter 18 that implement the Kentucky Supplemental Nutrition Program for Woman, Infant and Child Program      (WIC).

      (2) If this is an amendment to an existing administrative regulation, provide a brief summary of:

      (a) How the amendment will change this existing administrative regulation: This is a new regulation.

      (b) The necessity of the amendment to this administrative regulation: This is a new regulation.

      (c) How the amendment conforms to the content of the authorizing statutes: This is a new regulation.

      (d) How the amendment will assist in the effective administration of the statutes: This is a new regulation.

      (3) List the type and number of individuals, businesses, organizations, or state and local governments affected by this administrative regulation: The Department for Public Health, Local Health Agencies (61), WIC sites (148) WIC Vendors (886) and WIC Participants (128,883).

      (4) Provide an analysis of how the entities identified in question (3) will be impacted by either the implementation of this administrative regulation, if new, or by the change, if it is an amendment, including:

      (a) List the actions that each of the regulated entities identified in question      (3) will have to take to comply with this administrative regulation or amendment: No additional changes in the actions will need to be made from the Department of Public Health, Local Health Agencies, Local WIC Sites and WIC Participants. WIC Vendors will have to have internet access to meet the qualifications to be a WIC Vendor.

      (b) In complying with this administrative regulation or amendment, how much will it cost each of the entities identified in question (3): The Department for Public Health, Local Agencies, Local WIC sites, WIC Participants and Vendors will not experience an increase in cost to comply with the regulation.

      (c) As a result of compliance, what benefits will accrue to the entities identified in question (3): This regulation will provide better understanding of Chapter 18 as it relates to the Supplemental Nutrition Program for Woman, Infants and Children (WIC).

      (5) Provide an estimate of how much it will cost the administrative body to implement this administrative regulation:

      (a) Initially: There would be no additional cost to the Cabinet to implement and enforce this administrative regulation.

      (b) On a continuing basis: On a continuing basis, additional funding is not required.

      (6) What is the source of the funding to be used for the implementation and enforcement of this administrative regulation: The initial funding was from a grant from the USDA Food and Nutrition Services. There would be no additional cost to the Cabinet to implement and enforce this administrative regulation.

      (7) Provide an assessment of whether an increase in fees or funding will be necessary to implement this administrative regulation, if new or by the change if it is an amendment: No fees or new funding will be required to implement this regulation.

      (8) State whether or not this administrative regulation established any fees or directly or indirectly increased any fees: This regulation does not establish fees either directly or indirectly.

      (9) TIERING: Is tiering applied? Tiering is not appropriate in this administrative regulation since it applies equally to all those individuals or entities.

FISCAL NOTE ON STATE OR LOCAL GOVERNMENT

      1. What units, parts or divisions of state or local government (including cities, counties, fire departments, or school districts) will be impacted by this administrative regulation? This regulation will impact the Department of Public Health, Local Health Agencies, WIC Sites, WIC Vendors and WIC participants.

      2. Identify each state or federal statute or federal regulation that requires or authorizes the action taken by the administrative regulation. 1. Identify each state or federal statute or federal regulation that requires or authorizes the action taken by the administrative regulation. KRS 194A.050 authorizes the Department for Public Health to promulgate, administer, and enforce those administrative regulations in accordance with C.F.R. 7, Chapter 11, Volume 4, Part 246.

      3. Estimate the effect of this administrative regulation on the expenditures and revenues of a state or local government agency (including cities, counties, fire departments, or school districts) for the first full year the administrative regulation is to be in effect.

      (a) How much revenue will this administrative regulation generate for the state or local government (including cities, counties, fire departments, or school districts) for the first year? No new revenue will be generated for state or local government in the first year of implementing this regulation.

      (b) How much revenue will this administrative regulation generate for the state and local government (including cities, counties, fire departments, or school districts) for subsequent years? No new revenue will be generated for state or local government in the subsequent years of implementing this regulation.

      (c) How much will it cost to administer this program for the first year? There is no cost to the local or state governments to implement this regulation the first year.

      (d) How much will it cost to administer this program for the subsequent years? There is no cost to the local or state governments to implement this regulation for subsequent years.

      Note: If specific dollar estimates cannot be determined, provide a brief narrative to explain the fiscal impact of the administrative regulations.

      Revenues (+/-):

      Expenditures (+/-):

      Other Explanation: