(a) Definition. The agency must use the same definition of disability as used under SSI, except that—

(1) In determining the eligibility of individuals whose Medicaid eligibility is protected under §§435.130 through 435.134, the agency must use the definition of disability that was used under the Medicaid plan in December 1973; and

(2) The agency may use a more restrictive definition to determine eligibility under §435.121, if the definition is no more restrictive than that used under the Medicaid plan on January 1, 1972.

(b) State plan requirements. The State plan must contain the definition of disability.