Special Supplemental Nutrition Program for Women, Infants and Children (WIC): Vendor Cost Containment

This final rule adopts, with changes, an interim rule published on November 29, 2005 amending the WIC regulations. The final rule incorporates into program regulations new legislative requirements for vendor cost containment that affect the selection, authorization, and reimbursement of retail vendors. These requirements are contained in the Child Nutrition and WIC Reauthorization Act of 2004, enacted on June 30, 2004. The final rule reflects the statutory provisions that require State agencies to implement a vendor peer group system, competitive price criteria, and allowable reimbursement levels in a manner that ensures the WIC Program pays authorized vendors competitive prices for supplemental foods. It also requires State agencies to ensure vendors that derive more than 50 percent of their annual food sales revenue from WIC food instruments ("above-50-percent vendors") do not cause higher food costs for the program than do other vendors ("regular vendors"). The intent of these provisions is to maximize the number of eligible women, infants, and children served with available Federal funding.