677 F.2d 1317 (9th Cir. 1982), 81-5689, Beltran v. Myers

Docket Nº:81-5689.
Citation:677 F.2d 1317
Party Name:Antonia BELTRAN and Enosinsio Manahan, individually and on behalf of all others similarly situated, Plaintiffs-Appellees, v. Beverly A. MEYERS, individually and in her capacity as Director of the California State Department of Health; and Elizabeth Lyman, individually and in her capacity as Deputy Director of the California State Department of Heal
Case Date:May 25, 1982
Court:United States Courts of Appeals, Court of Appeals for the Ninth Circuit
 
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Page 1317

677 F.2d 1317 (9th Cir. 1982)

Antonia BELTRAN and Enosinsio Manahan, individually and on

behalf of all others similarly situated,

Plaintiffs-Appellees,

v.

Beverly A. MEYERS, individually and in her capacity as

Director of the California State Department of Health; and

Elizabeth Lyman, individually and in her capacity as Deputy

Director of the California State Department of Health,

Defendants-Appellants.

No. 81-5689.

United States Court of Appeals, Ninth Circuit

May 25, 1982

Argued and Submitted April 5, 1982.

Page 1318

Richard J. Magasin, Deputy Atty. Gen., Los Angeles, Cal., for defendants-appellants.

Gill Deford, Nat. Senior Citizens Law Center, Los Angeles, Cal., for plaintiffs-appellees; Marie Y. Janiewski, Nat. Senior Citizens Law Center, Los Angeles, Cal., on brief.

Appeal from the United States District Court for the Central District of California.

Before WRIGHT and SNEED, Circuit Judges, and EAST [*], District Judge.

SNEED, Circuit Judge:

This is an appeal from the grant of a preliminary injunction against enforcement of the State of California's transfer of assets rule for medical assistance eligibility. Plaintiffs and appellees are a class of aged, blind, and disabled individuals who have been denied Medicaid (known in California as "Medi-Cal") benefits by application of California's transfer of assets rule, on the grounds that prior to applying for benefits, they transferred assets for less than adequate consideration in order to become eligible for assistance. They brought suit in the district court alleging that the California rule, which they allege is more strict than federal rules for determining eligibility, has been preempted by the Boren-Long Amendment to the Social Security Act, Pub.L.No.96-611, sec. 5(a)-(c), §§ 1613(c), 1902(j), 94 Stat. 3566, 3567-68 (1980) (codified at 42 U.S.C.A. §§ 1382b(c), 1396a(j) (Supp. 1975-1981)) (hereinafter cited to U.S.C. and U.S.C.A. only). Jurisdiction in the district court was based on 28 U.S.C. § 1343(3) and (4) and on 28 U.S.C. § 1331. The district court granted the preliminary injunction and the State of California appeals. We affirm.

I.

BACKGROUND

  1. Applicable Law

    1. Supplemental Security Income

    The Social Security Act defines available resources for the purpose of determining eligibility for Supplemental Security Income (SSI) for the aged, blind, and disabled at 42 U.S.C. § 1382b (1976 & Supp. II 1978). In determining whether an individual's resources exceed the limits for SSI eligibility, the Social Security Administration must exclude certain assets from consideration, including the individual's home, automobile, household goods, and personal effects. 1

    The Boren-Long Amendment alters section 1382b by adding a requirement that any transfer of assets for less than fair value within 24 months preceding the application for assistance shall be presumed to have been for the purpose of establishing eligibility for benefits or assistance under the Act. Assets so transferred shall be included in the applicant's resources for the purpose of determining eligibility based on need. 42 U.S.C.A. § 1382b(c) (Supp. 1975-1981). 2 Assets excluded under section

    Page 1319

    1382b(a) are also excluded under the Amendment, however, so that the transfer of an individual's home for less than fair value, for example, does not cause a denial of benefits under the Boren-Long Amendment. 3

    2. Medicaid

    Medicaid provides federal financial assistance to approved state plans furnishing medical assistance to aged, blind, or disabled individuals whose income and resources are insufficient to meet the costs of necessary medical services. 42 U.S.C. § 1396 et seq. (1976). A state Medicaid program must provide coverage to the "categorically needy"-including those individuals who receive SSI for the aged, blind, and disabled. 42 U.S.C. § 1396a(a)(10)(A); 42 C.F.R. § 435.4. States may provide coverage to the "medically needy"-those individuals with income and resources exceeding the limits for SSI eligibility, but nevertheless insufficient to meet the costs of necessary medical care. 42 U.S.C. § 1396a(a) (10)(C); 42 C.F.R. § 435.4.

    If a state plan does provide assistance to the "medically needy," it may apply a transfer of assets rule similar to the federal rule for SSI to those applicants. The Boren-Long Amendment changes the Social Security Act's rules for Medicaid plans, 42 U.S.C. § 1396a (1976), to allow states to deny medical assistance to individuals who are eligible only because they have disposed of resources for less than fair market value. 42 U.S.C.A. § 1396a(j) (Supp. 1975-1981). However, the state plan for implementing denial of Medicaid assistance to such individuals can be no more restrictive than the federal law governing the denial of SSI, except that states may extend the period of ineligibility beyond two years where the uncompensated value of disposed of resources exceeds $12,000, 42 U.S.C.A. § 1396a(j)(2). 4

  2. Standard Of Review

    The grant or denial of a preliminary injunction should be reversed only if the district court abused its discretion or based its decision on an erroneous legal...

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