of Title 26, may be cited as the "Social Security Amendments of 1967."

SHORT TITLE OF 1965 AMENDMENT Section 1 of Pub. L. 89-97 provided that Pub. L. 89-97, which enacted sections 424a, 426, 427, former sections 716 and 729-1, sections 907, 1316, former section 1317, sections 1318, 1395 to 1395dd, former section 1395ee, sections 1395gg to 1395/l and 1396-1396d of this title, section 6053 of Title 26, Internal Revenue Code, and section 2288-2 of Title 45, Railroads; amended sections 302, 303, 306, 401-406, 409 to 411, 413, 415 418, 422, 423, 425, 602, 603, 606, 701, 703, 704, 711, 713, 714, former sections 721-723, sections 1202, 1203, 1206, 1301, 1306, 1308, 1309, 1312, 1315, 1352, 1353, 1355, 1382, 1383, 1385, 1391, 1392, and 1395kk of this title, sections 72, 79, 213, 401, 451, 1401, 1402, 3101, 3102, 3111, 3121, 3122, 3125, 3201, 3211, 3221, 3401, 3402, 6051, 6205, 6413, 6652, and 6674 of Title 26, Internal Revenue Code, and sections 2288, 228e, and 228s-2 of Title 45. Railroads; repealed section 727 of this title; enacted provisions set out as notes under sections 242b, 302, 303, 306, 402, 403, 405, 410, 411, 415, 416, 418, 423, 4248, 426, 427, 602, former sections 722, 729-1 and sections 1202, 1301, 1308, 1309, 1315, 1316, 1352, 1382, 13957, 13950, 1395p, 1396b, and 2981 of this title, sections 213, 1401, 1402, 3121, 3201, and 6053 of Title 26, Internal Revenue Code, and section 228s-2 of Title 45, Railroads; and amended provisions set out as notes under sections 415 and 418 of this title and section 3121 of Title 26, Internal Revenue Code, may be cited as the "Social Security Amendments of 1965".

SHORT TITLE OF 1958 AMENDMENT Section 1 of Pub. L. 85-840 provided that Pub. L. 85– 840, which added former sections 722-725 and section 1311 of this title, amended this section and sections 303, 401, 402, 403, 406, 408, 409 411, 413-418, 422, 423, 425, 603, 701, 702, 711, 712, 1203, 1301, 1306, 1308 and 1353 of this title, sections 1401, 1402, 3101, 3111, 3121, 3122, 6334 and 6413 of Title 26, Internal Revenue Code, and section 228a of Title 45, Railroads, repealed section 424 of this title, and enacted notes set out under sections 303, 402, 403, 410, 411, 415, 416, 417, 418, 422 former section 721 and section 1202a of this title and sections 1401, 1402 and 3121 of Title 26, should be popularly known as the "Social Security Amendments of 1958".

TRANSFER OF FUNCTIONS

Functions, powers, and duties of Secretary of Health, Education, and Welfare under subsec. (a) (5) (A) of this section transferred to United States Civil Service Commission, see section 4728(a) (3) (D) of this title.

All functions of the Federal Security Administrator were transferred to the Secretary of Health, Education, and Welfare and all agencies of the Federal Security Agency were transferred to the Department of Health, Education, and Welfare by section 5 of 1953 Reorg. Plan No. 1, set out in the Appendix to Title 5, Government Organization and Employees. The Federal Security Agency and the office of Administrator were abolished by section 8 of 1953 Reorg. Plan No. 1.

"Administrator" was substituted for "Board", and "he", "him", or "his" for "it" or "its" wherever appearing by act Aug. 28, 1950, § 361 (c), (d).

Identical changes were effected by 1946 Reorg. Plan No. 2. See note under section 902 of this title.

PUBLIC ACCESS TO STATE DISBURSEMENT RECORDS Act Oct. 20, 1951, ch. 521, title VI, § 618, 65 Stat. 569, as amended by Pub. L. 86-778, title VI, § 603 (a), Sept. 13, 1960, 74 Stat. 992; Pub. L. 87-543, title I, § 141 (e), July 25, 1962, 76 Stat. 205, provided that: "No State or any agency or political subdivision thereof shall be deprived of any grant-in-ald or other payment to which it otherwise is or has become entitled pursuant to title I (other than section 3(a) (3) thereof), IV, X, XIV, or XVI (other than section 1603 (a) (3) thereof) of the Social Security Act, as amended [subchapters I (other than section 303 (a) (3) thereof), IV, X, XIV, or XVI (other than section 1383 (a) (3) thereof) of this chapter], by reason of the enactment or enforcement by such State of any legislation prescribing any conditions under which public access may be had to records of the disbursement of any such funds or pay

ments within such State, if such legislation prohibits the use of any list or names obtained through such access to such records for commercial or political purposes."

Section 603(b) of Pub. L. 86-778 provided that the amendment of section 618 of act Oct. 20, 1951, by Pub. L. 86-778, which inserted words "(other than section 3(a) (3) thereof)" shall take effect Oct. 1, 1960.

SECTION REFERRED TO IN OTHER SECTIONS

This section is referred to in sections 303, 304, 306, 602, 1202, 1315, 1352 of this title; title 25 sections 683, 686, 689.

§ 303. Payments to States; computation of amounts; quarterly expenditures to exceed average of total expenditures for each quarter of fiscal year ending June 30, 1965.

(a) From the sums appropriated therefor, the Secretary of the Treasury shall pay to each State which has a plan approved under this subchapter, for each quarter, beginning with the quarter commencing October 1, 1960

(1) in the case of any State other than Puerto Rico, the Virgin Islands, and Guam, an amount equal to the sum of the following proportions of the total amounts expended during each month of such quarter as old-age assistance under the State plan (including expenditures for premiums under part B of subchapter XVIII of this chapter for individuals who are recipients of money payments under such plan and other insurance premiums for medical or any other type of remedial care or the cost thereof)

(A) 31/37 of such expenditures, not counting so much of any expenditure with respect to such month as exceeds the product of $37 multiplied by the total number of recipients of old-age assistance for such month (which total number, for purposes of this subsection, means (1) the number of individuals who received old-age assistance in the form of money payments for such month, plus (ii) the number of other individuals with respect to whom expenditures were made in such month as old-age assistance in the form of medical or any other type of remedial care); plus

(B) the larger of the following:

(i) (I) the Federal percentage (as defined in section 1301(a) (8) of this title) of the amount by which such expenditures exceed the amount which may be counted under clause (A), not counting so much of such excess with respect to such month as exceeds the product of $38 multiplied by the total number of recipients of old-age assistance for such month, plus (II) 15 per centum of the total expended during such month as old-age assistance under the State plan in the form of medical or any other type of remedial care, not counting so much of such expenditure with respect to such month as exceeds the product of $15 multiplied by the total number of recipients of old-age assistance for such month, or

(ii) (I) the Federal medical percentage (as defined in section 306(c) of this title) of the amount by which such expenditures exceed the maximum which may be counted under clause (A), not counting so much of any expenditures with respect to such month as exceeds (a) the product of $52 multiplied by

the total number of such recipients of old-age assistance for such month, or (b) if smaller, the total expended as old-age assistance in the form of medical or any other type of remedial care with respect to such month plus the product or $37 multiplied by such total number of such recipients, plus (II) the Federal percentage of the amount by which the total expended during such month as old-age assistance under the State plan exceeds the amount which may be counted under clause (A) and the preceding provisions of this clause (B) (ii), not counting so much of such excess with respect to such month as exceeds the product of $38 multiplied by the total number of such recipients of old-age assistance for such month;

(2) in the case of Puerto Rico, the Virgin Islands, and Guam, an amount equal to

(A) one-half of the total of the sums expended during such quarter as old-age assistance under the State plan (including expenditures for premiums under part B of subchapter XVIII of this chapter for individuals who are recipients of money payments under such plan and other insurance premiums for medical or any other type of remedial care or the cost thereof), not counting so much of any expenditure with respect to any month as exceeds $37.50 multiplied by the total number of recipients of old-age assistance for such month; plus

(B) the larger of the following amounts: (i) one-half of the amount by which such expenditures exceed the maximum which may be counted under clause (A), not counting so much of any expenditure with respect to any month as exceeds (I) the product of $45 multiplied by the total number of such recipients of old-age assistance for such month, or (II) if smaller, the total expended as old-age assistance in the form of medical or any other type of remedial care with respect to such month plus the product of $37.50 multiplied by the total number of such recipients, or (ii) 15 per centum of the total of the sums expended during such quarter as old-age assistance under the State plan in the form of medical or any other type of remedial care, not counting so much of any expenditure with respect to any month as exceeds the product of $7.50 multiplied by the total number of such recipients of old-age assistance for such month;

(3) in the case of any State, an amount equal to the Federal medical percentage (as defined in section 306 (c) of this title) of the total amounts expended during such quarter as medical assistance for the aged under the State plan (including expenditures for insurance premiums for medical or any other type of remedial care or the cost thereof); and

(4) in the case of any State whose State plan approved under section 302 of this title meets the requirements of subsection (c) (1) of this section, an amount equal to the sum of the following proportions of the total amounts expended during such quarter as found necessary by the Secretary

of Health, Education, and Welfare for the proper and efficient administration of the State plan(A) 75 per centum of so much of such expenditures as are for

(i) services which are prescribed pursuant to subsection (c) (1) of this section and are provided (in accordance with the next sentence) to applicants for or recipients of assistance under the plan to help them attain or retain capability for self-care, or

(ii) other services, specified by the Secretary as likely to prevent or reduce dependency, so provided to such applicants or recipients, or

(iii) any of the services prescribed pursuant to subsection (c)(1) of this section, and of the services specified as provided in clause (ii), which the Secretary may specify as appropriate for individuals who, within such period or periods as the Secretary may prescribe, have been or are likely to become applicants for or recipients of assistance under the plan, if such services are requested by such individuals and are provided to such individuals in accordance with the next sentence, or

(iv) the training of personnel employed or preparing for employment by the State agency or by the local agency administering the plan in the political subdivision; plus

(B) one-half of so much of such expenditures (not included under subparagraph (A)) as are for services provided (in accordance with the next sentence) to applicants for or recipients of assistance under the plan, and to individuals requesting such services who (within such period or periods as the Secretary may prescribe) have been or are likely to become applicants for or recipients of such assistance; plus

(C) one-half of the remainder of such expenditures.

The services referred to in subparagraphs (A) and (B) shall, except to the extent specified by the Secretary, include only

(D) services provided by the staff of the State agency, or of the local agency administering the State plan in the political subdivision: Provided, That no funds authorized under this subchapter shall be available for services defined as vocational rehabilitation services under the Vocational Rehabilitation Act (i) which are available to individuals in need of them under programs for their rehabilitation carried on under a State plan approved under such Act, or (ii) which the State agency or agencies administering or supervising the administration of the State plan approved under such Act are able and willing to provide if reimbursed for the cost thereof pursuant to agreement under subparagraph (E), if provided by such staff, and

(E) Subject to limitations prescribed by the Secretary, services which in the judgment of the State agency cannot be as economically or as effectively provided by the staff of such State

or local agency and are not otherwise reasonably available to individuals in need of them, and which are provided, pursuant to agreement with the State agency, by the State health authority or the State agency or agencies administering or supervising the administration of the State plan for vocational rehabilitation services approved under the Vocational Rehabilitation Act or by any other State agency which the Secretary may determine to be appropriate (whether provided by its staff or by contract with public (local) or nonprofit private agencies);

except that services described in clause (ii) of subparagraph (D) hereof may be provided only pursuant to agreement with such State agency or agencies administering or supervising the administration of the State plan for vocational rehabilitation services so approved. The portion of the amount expended for administration of the State plan to which subparagraph (A) applies and the portion thereof to which subparagraphs (B) and (C) apply shall be determined in accordance with such methods and procedures as may be permitted by the Secretary; and

(5) in the case of any State whose State plan approved under section 302 of this title does not meet the requirements of subsection (c) (1) of this section, an amount equal to one-half of the total of the sums expended during such quarter as found necessary by the Secretary for the proper and efficient administration of the State plan, including services referred to in paragraph (4) and provided in accordance with the provisions of such paragraph.

(b) The method of computing and paying such amounts shall be as follows:

(1) The Secretary of Health, Education, and Welfare shall, prior to the beginning of each quarter, estimate the amount to be paid to the State for such quarter under the provisions of subsection (a) of this section, such estimate to be based on (A) a report filed by the State containing its estimate of the total sum to be expended in such quarter in accordance with the provisions of such subsection, and stating the amount appropriated or made available by the State and its political subdivisions for such expenditures in such quarter, and if such amount is less than the State's proportionate share of the total sum of such estimated expenditures, the source or sources from which the difference is expected to be derived, (B) records showing the number of aged individuals in the State, and (C) such other investigation as the Secretary of Health, Education, and Welfare may find necessary.

(2) The Secretary of Health, Education, and Welfare shall then certify to the Secretary of the Treasury the amount so estimated by the Secretary of Health, Education, and Welfare, (A) reduced or increased, as the case may be, by any sum by which it finds that its estimate for any prior quarter was greater or less than the amount which should have been paid to the State under subsection (a) of this section for such quarter, and (B) reduced by a sum equivalent to the pro

rata share to which the United States is equitably entitled, as determined by the Secretary of Health, Education, and Welfare, of the net amount recovered during any prior quarter by the State or any political subdivision thereof with respect to assistance furnished under the State plan; except that such increases or reductions shall not be made to the extent that such sums have been applied to make the amount certified for any prior quarter greater or less than the amount estimated by the Secretary of Health, Education, and Welfare for such prior quarter: Provided, That any part of the amount recovered from the estate of a deceased recipient which is not in excess of the amount expended by the State or any political subdivision thereof for the funeral expenses of the deceased shall not be considered as a basis for reduction under clause (B) of this paragraph.

(3) The Secretary of the Treasury shall thereupon, through the Fiscal Service of the Treasury Department and prior to audit or settlement by the General Accounting Office, pay to the State. at the time or times fixed by the Secretary of Health, Education, and Welfare, the amount so certified.

(c) (1) In order for a State to qualify for payments under paragraph (4) of subsection (a) of this section, its State plan approved under section 302 of this title must provide that the State agency shall make available to applicants for or recipients of old-age assistance under such State plan at least those services to help them attain or retain capability for self-care which are prescribed by the Secretary.

(2) In the case of any State whose State plan included a provision meeting the requirements of paragraph (1), but with respect to which the Secretary finds, after reasonable notice and opportunity for hearing to the State agency administering or supervising the administration of such plan, that—

(A) the provision has been so changed that it no longer complies with the requirements of paragraph (1), or

(B) in the administration of the plan there is a failure to comply substantially with such provision,

the Secretary shall notify such State agency that further payments will not be made to the State under paragraph (4) of subsection (a) of this section until he is satisfied that there will no longer be any such failure to comply. Until the Secretary is so satisfied further payments with respect to the administration of such State plan shall not be made under paragraph (4) of subsection (a) of this section but shall instead be made, subject to the other provisions of this subchapter, under paragraph (5) of such subsection.

(d) Notwithstanding the preceding provisions of this section, the amount determined under such provisions for any State for any quarter which is attributable to expenditures with respect to patients in institutions for mental diseases shall be paid only to the extent that the State makes a showing satisfactory to the Secretary that total expenditures in the State from Federal, State, and local sources for

average monthly payment of $35, and permitted the counting of individuals with respect to whom expenditures were made as old-age assistance in the form of medical or any other type of remedial care in determining the total number of recipients.

1956 Subsec. (a). Act Aug. 1, 1956, § 301, substituted "during such quarter as old-age assistance in the form of money payments under the State plan” for “during such quarter as old-age assistance under the State plan” in clauses (1) and (2), "who received oldage assistance in the form of money payments for such month" for "who received old-age assistance for such month" in par. (A) of clause (1), and inserted clause (4). Subsec. (a). Act Aug. 1, 1956, § 311 (c), eliminated ", which shall be used exclusively as old-age assistance," following "the Virgin Islands, an amount" in clauses (1) and (2), and substituted "including services which are provided by the staff of the State agency (or of the local agency administering the State plan in the political subdivision) to applicants for and recipients of old-age assistance to help them attain self-care" for "which amount shall be used for paying the costs of administering the State plan or for old-age assistance, or both, and for no other purpose" in clause (3).

Subsec. (a). Act Aug. 1, 1956, § 341, substituted "October 1, 1956" for "October 1, 1952", eliminated ", which shall be used exclusively as old-age assistance," following "the Virgin Islands, an amount", and substituted "360" for "$55", in clause (1), substituted "the product of $30" for "the product of $25" in par. (A) of clause (1), and “including services which are provided by the staff of the State agency (or of the local agency administering the State plan in the political subdivision) to applicants for and recipients of old-age assistance to help them attain self-care" for "which amount shall be used for paying the costs of administering the State plan or for old-age assistance, or both, and for no other purpose" in clause (3).

1954 Subsec. (b). Act Sept. 1, 1954, § 303 (b), substituted "subsection (a)" for "clause (1) of subsection (a)", wherever appearing, substituted "such subsection" for "such clause" in par. (1), and struck out "increased by five per centum" at the end of par. (3).

Subsec. (b) (1). Act Sept. 1, 1954, § 303 (a), substituted the words "the State's proportionate share" for "onehalf."

1952-Subsec. (a). Act July 18, 1952, increased the Federal share of the State's average monthly payment to four-fifths of the first $25 plus one-half of the remainder within individual maximums of $55, and changed formulas for computing the Federal share of public assistance for Puerto Rico and Virgin Islands.

1950 Subsec. (a). Act Aug. 28, 1950, § 302(a) changed the basis for computation of the Federal portion of oldage assistance.

1948 Subsec. (a). Act June 14, 1948, substituted $50 for $45 and $20 for $15.

1946 Subsec. (a). Act Aug. 10, 1946, § 501 (a), increased the maximum monthly State expenditure for an individual to which the Federal Government will contribute from $40 to $45, increased the Federal contribution for assistance from one-half the State's expenditure to two-thirds the State's expenditure up to $15 monthly per individual plus one-half the State's expenditure over $15 and changed the Federal contribution for administration from 5 percent of the Federal contribution for assistance to one-half the State expenditure for administration.

Subsec. (b). Act Aug. 10, 1946, § 501(b), changed references to clause (1) of subsec. (a) to refer to the entire subsection, substituted "the State's proportionate share" for "one-half” in par. (1) and struck out "increased by 5 per centum" at end of par. (3).

1939 Act Aug. 10, 1939, amended section generally, including the substitution of $40 for $30 in subsec. (a).

EFFECTIVE DATE OF 1968 AMENDMENT

Section 212(e) of Pub. L. 90-248 provided that: "The amendments made by the preceding subsections of this section [to sections 303 (a) (4) (D), 1203(a)(3)(D), 1353 (a) (3) (D), and 1383(a) (4) (D) of this title] shall take effect January 1, 1968."

EFFECTIVE DATE OF 1965 AMENDMENT Amendment of this section by section 221 of Pub. L. 89-97 applicable in the case of expenditures made after Dec. 31, 1965, under a State plan approved under this subchapter, see section 221(e) of Pub. L. 89-97, set out as a note under section 302 of this title.

Section 401(f) of Pub. L. 89-97 provided that: "The amendments made by this section [to subsec. (a) (1) of this section and sections 603 (a) (1), 1203 (a) (1), 1353 (a), (1), and 1383 (a)(1) of this title] shall apply in the case of expenditures made after December 31, 1965, under a State plan approved under title I, IV, X, XIV, or XVI of the Social Security Act [subchapter I, IV, X, XIV, or XVI of this chapter]."

EFFECTIVE DATE OF 1962 AMENDMENT

Section 202 (d) of Pub. L. 87-543 provided that: "The amendments made by sections 109 and 132 (other than subsections (d) and (e) thereof) [amending sections 303(a) (1), (2), 606(b), 1203(a) (1), (2) and 1353 (a) (1), (2) of this title] shall be applicable in the case of expenditures, under a State plan approved under title I, IV, X, or XIV of the Social Security Act [subchapter I, IV, X, or XIV of this chapter], as the case may be, made after September 30, 1962."

Section 202(f) of Pub. L. 87-543 provided that: "The amendments made by section 101 (a) [amending sections 303 (a) (4), 603 (a) (1)—(3), 1203(a)(3) and 1353 (a) (3) of this title] shall be applicable in the case of expenditures, under a State plan approved under title I, IV, X, or XIV of the Social Security Act [subchapters I, IV, X, or XIV of this chapter], as the case may be, made after August 31, 1962. The amendments made by section 101(b) [adding sections 303 (a) (5), (c), 603 (a) (4), (c), 1203 (a) (4), (c) and 1353 (a) (4), (e) of this title and amending sections 303 (a)(4), 603(a)(3), 608(d), 609(b), 1203 (a)(3) and 1353(a)(3) of this title] shall be applicable in the case of expenditures, under a State plan approved under title I, IV, X, or XIV of the Social Security Act [subchapters I, IV, X, or XIV of this chapter], as the case may be, made after June 30, 1963."

EFFECTIVE DATE of 1961 AMENDMENTS

Section 303 (e) of Pub. L. 87-64, as amended by Pub. L. 87-543, title I, §132 (e), July 25, 1962, 76 Stat. 196, provided that: "The amendments made by subsections (a), (b), and (c) of this section [to subsec. (a) of this section and sections 1203(a) and 1353 (a) of this title] shall apply only in the case of expenditures made after September 30, 1961, and before October 1, 1962, under a State plan approved under title I, X, or XIV, as the case may be, of the Social Security Act [subchapters I, X or XIV of this chapter]."

Section 5(c) of Pub. L. 87-31 provided that: "The amendments made by subsections (a) and (b) [to subsecs. (a) (1) (C) and (a) (2) (B) of this section] shall apply in the case of expenditures made after June 30, 1961, under a State plan approved under title I of the Social Security Act [this subchapter]."

EFFECTIVE DATE OF 1960 AMENDMENT Amendment of subsecs. (a) and (b) (2) (B) of this section by Pub. L. 88-778 effective Oct. 1, 1960, see section 604 of Pub. L. 86-778, set out as a note under section 301 of this title.

EFFECTIVE DATE OF 1958 AMENDMENT Section 512 of Pub. L. 85-840 provided that:

"Notwithstanding the provisions of sections 305 and 345 of the Social Security Amendments of 1956, as amended [set out as note under this section], the amendments made by sections 501, 502, 503, 504, 505, and 506 [to subsec. (a) of this section and sections 603 (a), 1203 (a), 1301 (a) (1), (8) and 1353 (a) of this title] shall be effective

"(1) in the case of money payments, under a State plan approved under title I, IV, X, or XIV of the Social Security Act, for months after September 1958, and

"(2) in the case of assistance in the form of medical or any other type of remedial care, under such a plan, with respect to expenditures made after September 1958. The amendment made by section 506 [to section 1301 (a) (1) of this title] shall also become effective, for pur