CMS Pub. 100-06, ch. 2, § 110

A1-1340, B1-4340

The funding level approved by Congress limits the approval of funds. The contractor

shall draw funds to the lower of the cumulative quarterly distribution certified on the

NOBA or the Total Costs (amount expended) as reported on the IER or FACP. It shall

draw administrative funds during the period in line with expenditures. Funds drawn

during the subsequent month must be adjusted for administrative funds drawn in excess

of actual costs reported.

120 - Budget Amount Appears Insufficient - (Rev. 2, 08-30-02)

A1-1351, B1-4351

A. Submission of SBR

The contractor shall submit an SBR whenever it appears that the budgeted amount is

insufficient to adequately perform the required functions and the need for additional

funds can be adequately documented. As a general rule, it shall submit the SBR no later

than 90 days prior to the exhaustion of funds so as to allow CMS sufficient time to

respond prior to the need to submit an abatement notice. (See B below.) The SBR should

never be submitted less than 60 days prior to the exhaustion of funds unless it can be

demonstrated that it could not have been given in advance. Resolution of the SBR may

include:

An increase in the budget;

Institution of additional efficiencies;

A reduction of functions to be performed; or

Other ways and means agreeable to both parties.

The contractor shall discuss these alternatives in the SBR and, if after negotiating in good

faith, there is no satisfactory resolution, CMS will send a written rationale denying all or

part of the SBR.

B. Abatement Notice

The contractor shall submit a written abatement notice to the RO no less than 60 days

prior to the date on which it appears that the budgeted amount is insufficient to

adequately perform the required functions in accordance with the Cost of Administration

Article in the Contract/Agreement.