Note 14. Other Liabilities

The HHS’ other liabilities at September 30, 2007 and 2006 are summarized below:

The majority of the other liabilities include Deferred Revenue, Custodial Liabilities, Contingent Liabilities, the Vaccine Injury Compensation Program, and Other Intragovernmental Liabilities.

Deferred Revenue:

The CMS receives premium payments on behalf of select categories of beneficiaries from third parties. In some instances, the payments received exceed the amount billed. As of the end of the accounting period, the excess collections are reported as deferred revenue received that will be applied against the next month’s premium bill. The CMS accounts for $329 million of the deferred revenue with the public.

The IHS accounts for $137 million of the intragovernmental deferred revenue for construction-in-process projects primarily under the Contribution Indian Health Facilities fund, and $173 million of the deferred revenue with the public for the Tribal Buybacks. The SAMHSA accounts for $160 million intragovernmental deferred revenue for interagency agreements with another Federal agency to award and administer the Drug Free Communities program grants. The Vaccine Injury Compensation Program administered by the HRSA accounts for $90 million in intragovernmental deferred revenue arising from the provision of goods and services by the program. The NIH accounts for $46 million deferred revenue with the public for unearned Cooperative Research and Development Agreement (CRADA) revenue.  The AHRQ accounts for $23 million of intragovernmental deferred revenue for Public Health Service Evaluations.

Other Intragovernmental Liabilities:

Other Intragovernmental Liabilities of $815 million are primarily comprised of $530 million which CMS owes to other Federal entities, primarily to the Department of the Treasury ($480 million at September 30, 2007). The CMS’ payable to Treasury is a result of the receivables from the beneficiaries and Medicare contractors. The CMS owes other Federal entities $50 million for services performed through interagency agreements.

Environmental and Disposal Costs:

The Comprehensive Environmental Response Compensation and Liability Act, the Comprehensive Environmental Cleanup and Responsibility Act, the Superfund Amendments and Reauthorization Act of 1986, and the Conservation Recovery Act of 1976 are several laws and regulations which require the HHS to remove, contain, and/or dispose of hazardous waste. Environmental and disposal costs are the costs of removing, containing, and/or disposing of (1) hazardous waste from property, and/or (2) material and/or property that consist of hazardous waste at a permanent or temporary closure or shutdown of associated property, plant, or equipment. The majority of the environmental and disposal costs consist of the IHS liabilities associated with surveying, testing, and remediating contaminated sites and the NIH ground water remediation project in accordance with applicable laws and regulations.

The HHS’ other liabilities at September 30, 2007 and 2006 are summarized below:

The majority of the other liabilities include Deferred Revenue, Custodial Liabilities, Contingent Liabilities, the Vaccine Injury Compensation Program, and Other Intragovernmental Liabilities.

Deferred Revenue:

The CMS receives premium payments on behalf of select categories of beneficiaries from third parties. In some instances, the payments received exceed the amount billed. As of the end of the accounting period, the excess collections are reported as deferred revenue received that will be applied against the next month’s premium bill. The CMS accounts for $329 million of the deferred revenue with the public.

The IHS accounts for $137 million of the intragovernmental deferred revenue for construction-in-process projects primarily under the Contribution Indian Health Facilities fund, and $173 million of the deferred revenue with the public for the Tribal Buybacks. The SAMHSA accounts for $160 million intragovernmental deferred revenue for interagency agreements with another Federal agency to award and administer the Drug Free Communities program grants. The Vaccine Injury Compensation Program administered by the HRSA accounts for $90 million in intragovernmental deferred revenue arising from the provision of goods and services by the program. The NIH accounts for $46 million deferred revenue with the public for unearned Cooperative Research and Development Agreement (CRADA) revenue.  The AHRQ accounts for $23 million of intragovernmental deferred revenue for Public Health Service Evaluations.

Other Intragovernmental Liabilities:

Other Intragovernmental Liabilities of $815 million are primarily comprised of $530 million which CMS owes to other Federal entities, primarily to the Department of the Treasury ($480 million at September 30, 2007). The CMS’ payable to Treasury is a result of the receivables from the beneficiaries and Medicare contractors. The CMS owes other Federal entities $50 million for services performed through interagency agreements.

Environmental and Disposal Costs:

The Comprehensive Environmental Response Compensation and Liability Act, the Comprehensive Environmental Cleanup and Responsibility Act, the Superfund Amendments and Reauthorization Act of 1986, and the Conservation Recovery Act of 1976 are several laws and regulations which require the HHS to remove, contain, and/or dispose of hazardous waste. Environmental and disposal costs are the costs of removing, containing, and/or disposing of (1) hazardous waste from property, and/or (2) material and/or property that consist of hazardous waste at a permanent or temporary closure or shutdown of associated property, plant, or equipment. The majority of the environmental and disposal costs consist of the IHS liabilities associated with surveying, testing, and remediating contaminated sites and the NIH ground water remediation project in accordance with applicable laws and regulations.

Report Date: November 15, 2007

AFR Section II Links:

• Message from the Chief Financial Officer
• Office of Inspector General Transmittal
• Independent Auditor's Reports
• Financial Statements and Notes
• Required Supplementary Stewardship Information
• Required Supplementary Information