Skip Ribbon Commands
Skip to main content
Navigate Up
Sign In

REGS : 10.54.03 Retail Food and Pharmacy Vendors (SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, AND CHILDREN (WIC))

 

 Content Editor

 
 
PROPOSAL
Maryland Register
Issue Date:  February 7, 2014
Volume 41 • Issue 3 • Page 239—244
 
Title 10
DEPARTMENT OF HEALTH AND MENTAL HYGIENE
Subtitle 54 SPECIAL SUPPLEMENTAL NUTRITION PROGRAM FOR WOMEN, INFANTS, AND CHILDREN (WIC)
10.54.03 Retail Food and Pharmacy Vendors
Authority: Health-General Article, §18-107(a), Annotated Code of Maryland
 
Notice of Proposed Action
[14-057-P]
 
The Secretary of Health and Mental Hygiene proposes to amend Regulations .03—.07, .09, .10, .11, .13—.16, .18, and .19 under COMAR 10.54.03 Retail Food and Pharmacy Vendors.
 
Statement of Purpose
The purpose of this action is to update definitions and terminology; amend certain amounts of minimum required stock and vendor practices; and alter vendor sanctions, including the removal of suspensions and altering the definition of disqualification.
 
Comparison to Federal Standards
There is no corresponding federal standard to this proposed action.
 
Estimate of Economic Impact
The proposed action has no economic impact.
 
Economic Impact on Small Businesses
The proposed action has minimal or no economic impact on small businesses.
 
Impact on Individuals with Disabilities
The proposed action has no impact on individuals with disabilities.
 
Opportunity for Public Comment
Comments may be sent to Michele A. Phinney, Director, Office of Regulation and Policy Coordination, Department of Health and Mental Hygiene, 201 West Preston Street, Room 512, Baltimore, MD 21201, or call 410-767-6499; TTY:800-735-2258, or email to dhmh.regs@maryland.gov, or fax to 410-767-6483. Comments will be accepted through March 10, 2014. A public hearing has not been scheduled.
 
.03 Definitions.
A. (text unchanged)
B. Terms Defined.
(1)—(3) (text unchanged)
(4) “Change [of] in ownership” means the transfer of majority control or ownership of a store.
(5)—(6) (text unchanged)
(7) “Disqualification” means [a permanent] revocation of a vendor’s WIC authorization for a specified period of time as prescribed in Regulation .16 of this chapter.
(8)—(9) (text unchanged)
[(10) “First business day” means the first day in a month other than a Saturday, Sunday, or State holiday.]
[(11)] (10)[(13)] (12) (text unchanged)
[(14)] (13) “Food sales” means sales of all [Food Stamp Program] SNAP eligible foods intended for home preparation and consumption, as set forth in 7 C.F.R. §246.2.
[(15)] (14)[(16)] (15) (text unchanged)
(16) “High risk” means a vendor has been determined by the State agency to have a high probability of violating program requirements.
(17)(35) (text unchanged)
(36) “Region 6” means Calvert, Caroline, Cecil, Charles, Dorchester, Kent, Queen Anne’s, [Saint] St. Mary’s, Somerset, Talbot, Wicomico, and Worcester counties.
(37)—(39) (text unchanged)
(40) [“Suspension” means the act of ending the Program participation of a vendor for a certain period of time.] “Supplemental Nutrition Assistance Program (SNAP)” means the federal program administered by the United States Department of Agriculture that provides financial assistance for purchasing food.
(41) (text unchanged)
[(421)] (42) (text unchanged)
(43)—(49) (text unchanged)
.04 Authorization Requirements.
A.—B. (text unchanged)
C. In order to receive authorization from the State agency, a vendor shall:
(1) (text unchanged)
(2) Hold a current food service facility license issued by a local health department or department of environment, authorization by the [Food Stamp Program] SNAP, and, if a food store/pharmacy combination, a current permit to operate as a pharmacy issued by the State Board of Pharmacy;
(3)—(10) (text unchanged)
D. (text unchanged)
E. In order to receive authorization from the State agency as a pharmacy vendor only, a pharmacy shall:
(1)—(3) (text unchanged)
F. (text unchanged)
G. A vendor applicant or vendor may not apply for authorization if it:
(1) Is currently under [suspension or] disqualification by the State agency or the [Food Stamp Program] SNAP;
(2) Is designated as high risk;
[(2)] (3) (text unchanged)
[(3)] (4) Derives or will derive after commencement of business more than 50 percent of the vendor’s or applicant’s eligible food sales revenue from food purchased with WIC food instruments, with the exception of a nonprofit entity[.] , or an above 50 percent vendor the State agency has authorized for participant access reasons.
H. A previously authorized vendor currently [under suspension] disqualified may not apply for authorization during the period of disqualification.
I.—K. (text unchanged)
.05 Requirements for Military Commissaries.
A. (text unchanged)
B. To become an authorized WIC vendor, a military commissary shall complete and sign a vendor agreement based on the memorandum of understanding jointly prepared by the [United States Department of Agriculture] USDA and the United States Department of Defense, in place of the vendor agreement defined in Regulation .03B of this chapter.
.06 Food Packages for Peer Group Price Calculation.
A.—D. (text unchanged)
E. The State agency shall provide, upon request, the current peer group average for all vendors in Peer Group 19 for each food package in §A of this regulation.
.07 Vendor Application Packet and Dates.
A.—B. (text unchanged)
C. A vendor applicant denied authorization [3] three times in a calendar year may not reapply until 1 year after the last denial date.
.09 Grant, Retention, and Denial of Authorization.
A.—D. (text unchanged)
E. Authorization Period.
(1) The State agency, in accordance with 7 CFR 246.12, may not authorize a vendor for a period exceeding 3 years.
(2) The State Agency, at its discretion, may authorize a vendor for a period less than 3 years.
.10 Food Package Prices After Authorization.
A.—C. (text unchanged)
D. If a vendor, other than a pharmacy or a military commissary, submits prices on the vendor price list form that make its food package price more than 125 percent of the peer group average for that food package, or the food package prices are determined by the WIC Management Information System calculation to exceed 125 percent of the peer group average, the State agency shall notify the vendor that:
(1)—(2) (text unchanged)
(3) If the vendor’s resubmitted prices indicate that a food package will cost the Program more than 125 percent of the peer group average for that food package, the State agency [shall suspend the vendor’s authorization] may disqualify the vendor for 1 year.
E. If, at any time, a vendor, other than a pharmacy or a military commissary, has actual highest shelf prices that make any food package price more than 125 percent of the peer group average, the State agency shall notify the vendor that:
(1) The vendor may lower its actual highest shelf prices for the WIC foods within 10 days; and
(2) If the vendor’s prices remain so that a food package will cost the Program more than 125 percent of the peer group average, the State agency shall disqualify the vendor for 1 year.
[E.] F. If, in 2 consecutive reporting months, a vendor, other than a pharmacy only store or a military commissary, is determined by the WIC Management Information System calculation to have food package prices that exceed 125 percent of the peer group average, the State agency [shall suspend the vendor’s authorization] may disqualify the vendor for 1 year.
[F.] G. The State agency may request that a vendor, other than a pharmacy or a military commissary, submit [interim] semi-annual price lists at the State agency’s sole discretion and may use these price lists and the WIC Management Information System for calculation of excess charges if it is determined that excess charges have occurred.
[G. If, at any time, a vendor, other than a pharmacy or a military commissary, has actual highest shelf prices that make any food package price more than 125 percent of the peer group average, the State agency shall notify the vendor that:
(1) The vendor may lower its actual highest shelf prices for the WIC foods within 10 days; and
(2) If the vendor’s prices remain so that a food package will cost the Program more than 125 percent of the peer group average, the State agency shall suspend the vendor’s authorization for 1 year.]
H. For the purpose of cost containment, the State agency shall assign to an above 50 percent vendor peer group a vendor that is determined by the State agency, through a comparison of the vendor’s gross annual sales, [food stamp] SNAP eligible sales, and WIC redemptions, to derive more than 50 percent of the vendor’s eligible food sales revenue from the redemption of WIC food instruments.
I. A vendor that has been determined to derive more than 50 percent of its eligible food sales revenue from the redemption of WIC food instruments will only be paid at the statewide average of all other non-above 50 percent vendors.
[I.] J. (text unchanged)
.11 Maximum Reimbursement to Vendors.
A. Food Store, Food Store/Pharmacy Combination, and Pharmacy Vendors. The State agency shall establish a maximum price payable for each food instrument, which shall be calculated as follows:
(1) (text unchanged)
(2) The State agency shall utilize the [quarterly] semi-annual price submissions by vendors, in accordance with Regulation .10 of this chapter, to determine the maximum price payable for each food instrument; and
(3) (text unchanged)
B.—C. (text unchanged)
.13 WIC-Authorized Foods.
A food store or food store/pharmacy combination vendor shall redeem food instruments for the following foods:
A. Fruits and vegetables:
(1) Fresh [, whole]:
(a) Whole or cut[,including organic];
(b) Organic;
(c) Loose or pre-packaged;
(2)—(3) (text unchanged)
B. [Adult] Dry cereal, 18-ounce box or larger for cold cereal, 11.8-ounce box or larger for hot cereal, in the following brands:
(1) (text unchanged)
(2) Kellogg’s cereals, limited to:
(a)—(b) (text unchanged)
(c) Frosted Mini Wheats [Bite Size] Original and Big Bites;
(d)—(e) (text unchanged)
(f) [Unfrosted Mini Wheats;] Scooby-Doo;
(3) B&G Foods Cream of Wheat:
[(a) Whole Grain;]
[(b)] (a) (text unchanged)
[(c)] (b) 2-1/2 minute; and
[(d) 10 minute; and]
[(e)] (c) (text unchanged)
(4)—(5) (text unchanged)
(6) Malt-O-Meal cereals, limited to:
(a)—(b) text unchanged
[(c) Crispy Rice; and]
[(d)] (c) (text unchanged)
[(7) Farina Mills cereals, limited to Hot Wheat Cereal;]
C. Infant cereal [as prescribed on a food instrument;]:
(1) As prescribed on a food instrument;
(2) 8-ounce or 16-ounce container; and
(3) Dry;
D. [Regular and reduced fat domestic] Domestic cheese in store brand when available including:
(1) [Sliced] 16-ounce sliced;
(2) [Block] 16-ounce block;
(3) Low fat, regular, and reduced fat; and
(4) Low sodium;
[(3)] (5) (text unchanged)
E. Beans, store brand when available:
(1) (text unchanged)
(2) Unflavored beans, lentils, or peas in 14-ounce to 16-ounce water packed cans; and
(3) (text unchanged)
F. Eggs, store brand when available:
(1) Medium, white; [and]
(2) Large, white; and
(3) One dozen only;
G. (text unchanged)
H. Infant fruits and vegetables in brand, type, and size prescribed on a food instrument, store brand if available:
(1) Plain vegetables or a combination of vegetables; [and]
(2) (text unchanged)
(3) 3.5-ounce to 4-ounce container; and
(4) Single or multi-packs;
I. Infant meat [in brand, type, and size prescribed on a food instrument, store brand if available]:
(1) [Second stage; and] Store brand if available;
(2) [Single meat ingredient] Plain chicken, turkey, beef, lamb, veal, or ham; and
(3) With gravy or broth;
J. Unsweetened 100-percent juice in 64-ounce containers in the following varieties and brands:
(1)—(3) (text unchanged)
(4) Apple:
(a)—(i) (text unchanged)
(j) Valu Time; [and]
(k) (text unchanged)
(l) Giant;
(m) Great Value;
(n) Essential Everyday; and
(o) Safeway;
(5)—(8) (text unchanged)
K. Frozen concentrate 100-percent juice in the following brands and varieties in size prescribed on the food instrument:
(1)—(2) (text unchanged)
(3) Apple:
(a)—(d) (text unchanged)
(e) Hannaford; [and]
(f) (text unchanged)
(g) Giant;
(h) Great Value;
(i) Essential Everyday; and
(j) Safeway;
(4)—(5) (text unchanged)
L. Fluid milk of the following varieties in gallons, store brand when available and in container size shown on check:
(1)—(3) (text unchanged)
M. (text unchanged)
N. Any brand of canned tuna, salmon, or sardines packed in water, store brand when available:
(1) [Tuna] Chunk light tuna in 5-ounce to 6-ounce cans;
(2) [Salmon] Pink salmon in 5-ounce to 7.5-ounce cans; and
(3) (text unchanged)
O. Any brand of peanut butter, 16-ounce to 18-ounce jar, store brand when available:
(1)—(3) (text unchanged)
(4) Extra crunchy; and
(5) Creamy; [and]
[(6) Honey roasted;]
P. 100-percent whole wheat [rolls or] bread or rolls in 1-pound or 15-ounce to 16-ounce packages:
(1) Store brand when available; and
(2) Label shall read [“100% Whole Wheat”;]:
(a) “100% Whole Wheat Bread”; or
(b) “100% Whole Wheat Rolls”;
[(3) The following whole grain breads:
(a) Acme 100% Whole Grain Bread;
(b) Nature’s Own 100% Whole Grain Wheat Sugar Free Bread;
(c) Pepperidge Farm Very Thin Whole Wheat Bread;
(d) Roman Meal Sungrain 100% Whole Wheat Bread;
(e) Schmidt Old Tyme 100% Whole Wheat Whole Grain Bread; and
(f) Stern’s Whole Wheat Bread;]
Q. Brown rice in:
(1) 16-ounce packages; [and]
(2) (text unchanged)
(3) Dry, plain; and
(4) Regular;
R. (text unchanged)
S. Soy beverages if prescribed on a food instrument, in the brand and size shown on the check, the following brands and varieties:
(1) 8th Continent, half gallons original, plain, refrigerated; [and]
(2) 8th Continent, quarts, original, plain, shelf-stable; and
(3) Pacific Natural Foods Ultra Soy Brands, quarts, plain, shelf-stable; and
T. Tofu, if printed on a food instrument, in the following brands and varieties, and in 12-ounce to 16-ounce containers:
(1) Azumaya, extra firm, firm, silken, and lite extra [lite] firm;
(2) House, [soft (silken), medium firm (regular), firm, and] extra firm, medium firm (regular), cubed, and soft (silken); and
(3) Nasoya, extra firm, firm, [silken,] soft, silken, lite firm, and lite silken.
.14 Minimum Required Stock.
A. A food store or food store/pharmacy combination vendor shall maintain in the store during regular business hours the following minimum stock:
(1) (text unchanged)
(2) [Medium] 6 dozen medium or large white eggs[:];
[(a) One brand; and
(b) 6 dozen;]
(3) Domestic cheese:
(a) Four varieties; [and]
(b) (text unchanged)
(c) 16-ounce packages only; and
(d) Block or sliced;
(4) Unsweetened 100-percent fruit juice:
[(a) Two brands;]
[(b)] (a)[(c)] (b) (text unchanged)
(5) Frozen concentrate 100-percent juice:
(a)—(b) (text unchanged)
(c) [9] Nine [11-ounce] 11.5-ounce to 12-ounce cans;
(6) [Any brand of infant] Infant fruits and vegetables in [16] 32 3.5-ounce to 4-ounce containers:
(a)—(c) (text unchanged)
(7) Infant meat:
(a) 31 2.5-ounce jars; and
(b) Two varieties of plain meat; [and]
[(c) First or second stage single meat ingredient;]
(8) [Adult] Dry cereal:
(a)—(d) (text unchanged)
(9) Six 8-ounce or 16-ounce boxes dry infant cereal as specified by the WIC infant cereal rebate contract:
(a)—(b) (text unchanged)
(10) Peanut butter:
(a) (text unchanged)
(b) Six 16-ounce to 18-ounce containers;
(11) Dry and water-packed canned beans:
(a) [3] Three 1-pound bags dry type in two varieties; and
(b) 12 [15] 14-ounce to 16-ounce cans in three varieties;
(12) 30 ounces, two varieties canned tuna, salmon, and sardines packed in water:
(a) [Tuna] Chunk light tuna in 5-ounce to 6-ounce cans;
(b) [Salmon] Pink salmon in 5-ounce[, 6-ounce, or] to 7.5-ounce cans; or
(c) (text unchanged)
(13) Vegetables and fruits in two varieties and a total value of $32:
(a) (text unchanged)
(b) Frozen[;] or canned; and
(c) [Canned] Loose or pre-packaged;
(14) 100-percent whole wheat bread and rolls, brown rice, soft corn tortillas, or whole wheat tortillas in two varieties and a total of 4 pounds:
(a) [14] 15-ounce to 16 [ounces]-ounce packages for bread;[, rice, and tortillas; and]
(b) [15 to] 16 [ounces]-ounce packages for rolls;
(c) 16-ounce packages for tortillas; and
(d) 16-ounce packages for brown rice; and
(15) Infant formula:
(a)—(c) (text unchanged)
(d) Six [12.4-ounce] 12.9-ounce cans, or cans of current can size, of soy-based powdered infant formula containing DHA/RHA as specified by the WIC infant formula rebate contract.
B. (text unchanged)
.15 Required Vendor Practices.
A. (text unchanged)
B. General Requirements.
(1) A vendor shall:
(a)—(j) (text unchanged)
(k) If a pharmacy or a food store/pharmacy combination store [, provide special formulas within 48 hours of a request by a participant or the Program;]:
(i) Provide special formulas within 48 hours of a request by a participant or the Program;
(ii) Only accept the food instrument after obtaining the requested formula; and
(iii) If a pharmacy only vendor, only accept food instruments prescribing infant formula;
(l) (text unchanged)
(m) If a [food stamp] SNAP vendor, remain in good standing and not be assessed a [monetary] money penalty by the [Food Stamp Program] SNAP;
(n) (text unchanged)
(o) Pay, by the date due, [monetary] money penalties imposed by the State agency and excess charges;
(p)—(r) (text unchanged)
(2)—(3) (text unchanged)
C.—D. (text unchanged)
.16 Vendor Sanctions.
A. The Program [shall] may sanction a vendor that fails to comply with a required practice in [Regulation .15B(1)(a)—(f), (2)(f)—(h), and C(1)(a)—(f) and (h), and (2)(a)—(c)] Regulation .15B(1)(a)—(k) and (q), (2)(b) and (f)—(h), C(1)(a)—(g) and (h)—(n), (2)(a)—(c) and (e)—(f), (3), and D(1)(a)—(b) and (e), and (2)(a) of this chapter as follows:
(1) (text unchanged)
(2) Disqualification for 1 year for [three] a pattern of violations of the same provisions within a 1-year period; and
(3) Disqualification for 1 year for a combination of [5] six violations within a 1-year period.
[B. The Program shall sanction a vendor that fails to comply with a required practice in Regulation .15B(1)(g)—(k) and (2)(b), C(1)(i)—(n), (2)(e)—(f), and (3), and D(1)(a)—(b) and (e) of this chapter as follows:
(1) Written warning following each violation; and
(2) Disqualification for 1 year for a pattern of violations of the same provision within a 12-month period.]
[C.] B. The Program [shall] may sanction a vendor that fails to comply with a required practice in Regulation .15B(1)(l), [and (n)—(r)] (n)—(p), and (r), and (2)(c) and (e), C(1)(o), and D(1)(f) and (2)(b) of this chapter by disqualifying the vendor for 1 year.
[D.] C.—[G.] F. (text unchanged)
[H. The program shall sanction a vendor that fails to comply with the required practice in Regulation .15C(1)(g) or D(2)(a) of this chapter by disqualifying the vendor for 1 year.]
[I.] G. When a vendor that has previously received a sanction for violation of the provisions of [Regulation .15B(2)(a), C(2)(d) or (i), or D(1)(c)—(d) or (2)(c)] Regulation .15B(2)(a), C(2)(d) or (g), or D(1)(c)—(d) or (2)(c) of this chapter, the Program shall impose a sanction that is double that of the last sanction received for violation of the same provision.
[J.] H. The Program shall:
(1) Disqualify a vendor that has been [suspended,] disqualified[,] or assessed a [monetary] money penalty by the [Food Stamp Program] SNAP in violation of Regulation .15B(1)(m) of this chapter for the same length of time as the [Food Stamp Program] SNAP disqualification; or
(2) (text unchanged)
[K.] I.—[L.] J. (text unchanged)
[M.] K. The State shall notify the USDA of a disqualification or [monetary] money penalty:
(1)—(2) (text unchanged)
[N.] L. If a vendor is disqualified or has been assessed a [monetary] money penalty because of multiple violations in a single investigation, the Program shall:
(1) (text unchanged)
(2) Include the following in its notice to USDA:
(a) The vendor’s:
(i) Name[,];
(ii) Address[,]; and
(iii) (text unchanged)
(b)—(c) (text unchanged)
(d) The amount of any [monetary] money penalty.
[O.] M.—[Q.] O. (text unchanged)
[R.] P. Any adverse action taken by the [Food Stamp Program] SNAP will be reciprocated by the Program to include disqualification and if applicable, imposing a civil [monetary] money penalty.
.18 Vendor Appeals.
A. (text unchanged)
B. Notice.
(1) Not less than 15 days in advance of the effective date of the proposed Program action, the Program shall provide notice to a vendor applicant, or vendor whose application is proposed to be denied or authorization is proposed to be [suspended] disqualified, on the right to a hearing on the proposed denial or [suspension] disqualification.
(2) (text unchanged)
C.—D. (text unchanged)
E. A vendor may not appeal the following actions:
(1) Disqualification [or suspension] from WIC resulting from a violation of Regulation .15B(1)(m) of this chapter;
(2)—(10) (text unchanged)
.19 Participant Hardship.
A. Except for the sanction prescribed in Regulation [.16F] .16E of this chapter, the State agency may determine that a participant hardship would exist if a vendor is [suspended or] disqualified and one of the following conditions would result:
(1)—(3) (text unchanged)
B. If the State agency determines that a participant hardship would exist if a vendor is [suspended or] disqualified, the State agency, in its sole discretion, may impose a [monetary] money penalty instead of [suspension or] disqualification if the vendor:
(1)—(2) (text unchanged)
C. If the State agency determines to impose a [monetary] money penalty, the State agency shall calculate the amount of the [monetary] money penalty for each violation by multiplying 10 percent of the vendor’s average monthly food instrument redemptions by the number of months the [suspension] disqualification would have been in effect.
D. The State agency shall calculate the average monthly redemption by using:
(1) The 6 months immediately preceding notice to the vendor of the [suspension or] disqualification; or
(2) Up to 6 months’ data if the vendor has not redeemed food instruments for a full 6 months before notice of the [suspension or] disqualification.
E. The maximum [monetary] money penalty for each:
(1) Violation that would have resulted in a [suspension or] disqualification is $11,000; and
(2) Investigation that detected violations that would have resulted in [suspension or] disqualification is $49,000.
F. Vendor [Monetary] Money Payment.
(1) A vendor that owes a [monetary] money penalty pursuant to §C of this regulation shall pay the [monetary] money penalty either in a lump sum within 1 month from the date of billing by the State agency, or in installments.
(2) The State agency shall calculate the number of installment payments by dividing the amount due by 1/2 the number of months the [suspension] disqualification would have been in effect.
(3) The vendor shall pay the:
(a) First installment not later than the date the [suspension] disqualification would have been effective had there been no participant hardship; and
(b) (text unchanged)
G. If a vendor fails to pay the [monetary] money penalty in accordance with the payment schedule as provided in §F of this regulation, the State agency shall [suspend] disqualify the vendor’s authorization for the full period of the sanction and may not refund any partial payments.
[H. The State agency may not impose a monetary penalty in lieu of disqualification for a vendor that has been sanctioned as required by Regulation .16J of this chapter.]
JOSHUA M. SHARFSTEIN, M.D.
Secretary of Health and Mental Hygiene