Robinson v. Bowen, 1243

• Decision Date: 27 August 1987
• Docket Number: No. 1243,D,1243
• Parties: Marie ROBINSON, Plaintiff-Appellant, v. Otis R. BOWEN, M.D., Secretary of Health and Human Services, Defendant- Appellee. ocket 87-6051.
• Court: U.S. Court of Appeals — Second Circuit

Page 71

828 F.2d 71

19 Soc.Sec.Rep.Ser. 11

Marie ROBINSON, Plaintiff-Appellant, v. Otis R. BOWEN, M.D., Secretary of Health and Human Services Defendant- Appellee.

No. 1243, Docket 87-6051.

United States Court of Appeals Second Circuit.

Argued June 17, 1987.

Decided Aug. 27, 1987.

Marianne Artusio, Westchester Legal Services, Inc., Yonkers, N.Y., for plaintiff-appellant.

Mark S. Sochaczewsky, Sp. Asst. U.S. Atty., S.D. of N.Y., New York City (Rudolph W. Giuliani, U.S. Atty., for the S.D. of N.Y., Nancy Kilson, Asst. U.S. Atty., S.D. of N.Y., New York City, Annette H. Blum, Chief Counsel, Region II, Linda A. Riffkin, Asst. Regional Counsel, Dept. of Health and Human Services, New York City, of counsel), for defendant-appellee.

Before OAKES, MESKILL and PRATT, Circuit Judges.

PER CURIAM:

This is an appeal from a judgment of the United States District Court for the Southern District of New York, Weinfeld, J., granting the motion of the Secretary of Health and Human Services (Secretary) for judgment on the pleadings. Plaintiff-appellant Marie Robinson's complaint was dismissed and her motion to certify a class was denied as moot.

In this action, brought pursuant to 42 U.S.C. Sec. 405(g) (1982), Robinson challenges a regulation promulgated by the Secretary, 20 C.F.R. Sec. 416.1123(b)(1), which permits the Secretary to calculate Supplemental Security Income (SSI) benefits by including in unearned income amounts not actually received in hand but which were withheld by other agencies to recover prior overpayments.

Robinson, a widow receiving benefits from the Veteran's Administration (VA), failed to report to the VA additional income she received under Title II of the Social Security Act. As a result, she began receiving overpayments from the VA in 1981. In 1982, the VA began to recover the overpayment by withholding Robinson's entire monthly benefit. By October 1985, the entire overpayment was recaptured and Robinson again began to receive her monthly VA check.

In 1983, while her VA benefits were being withheld, Robinson applied for SSI benefits. Her application was finally approved by an Administrative Law Judge in January 1985. Under a Social Security Administration regulation, 20 C.F.R. Sec. 416.1123(b)(1), the Secretary calculated Robinson's SSI benefit amount by including in her unearned income the amounts withheld by the VA to recoup its overpayment. Robinson, therefore, was deemed to have a greater amount of income than she actually received. Accordingly, the amount of SSI benefits allowed was lower than it would have been had only the funds she received in hand been considered as income.

Robinson challenged the Secretary's regulation on the ground that it conflicted with the governing statute, 42 U.S.C. Sec. 1382(a)(2)(B) (1982), congressional intent, the policy behind awarding SSI benefits, the Deficit Reduction Act of 1984, 42 U.S.C. Sec. 1383(b)(1)(B) (Supp. III 1985), and the Equal Protection Clause. Judge Weinfeld rejected Robinson's challenge and dismissed the complaint. This appeal followed.

We disagree with Robinson's contention that the Secretary exceeded his authority in promulgating section 416.1123(b)(1). As Judge Weinfeld noted, if overpayment withholdings were excluded from unearned income, then Robinson's SSI benefit would be increased and the VA debt would become subsidized with SSI funds. This result would frustrate the congressional policy of preserving SSI resources. We affirm the judgment of the district court, substantially for the reasons set out in Judge Weinfeld's opinion below, Robinson v. Bowen, 650 F.Supp. 1495 (S.D.N.Y.1987). The judgment of the district court is affirmed.

OAKES, Circuit Judge (dissenting):

I dissent.

Income and resources taken into account in determining SSI eligibility include "unearned income," defined in 42 U.S.C. Sec. 1382a(a)(2)(B) to include

any payments received as an annuity, pension, retirement, or disability benefit, including veterans' compensation and pensions, workmen's compensation payments, old-age, survivors and disability insurance benefits, railroad retirement annuities and pensions, and unemployment insurance benefits.

I do not put much stock in the omission of "received" from the subsections other than (a)(2)(B), i.e., (a)(2)(A), (C), (D), (E), and (F), though such an omission does create an ambiguity.

Congress's purpose in creating the SSI program was " '[t]o assist those who cannot work because of age, blindness, or disability' ... by 'set[ting] a Federal guaranteed minimum income level for aged, blind, and disabled persons.' " Schweiker v. Wilson, 450 U.S. 221, 223, 101 S.Ct. 1074, 1077, 67 L.Ed.2d 186 (1981), quoting S.Rep. No. 1230, 92d Cong., 2d Sess. 4, 12 (1972). The legislation was "designed to provide a positive assurance that the Nation's aged, blind, and disabled people would no longer have to subsist on below-poverty level incomes," S.Rep. No. 1230 at 384, by providing an "assured total monthly income," id. at 13, 75. As the Seventh Circuit has stated it, "increasing purchasing power to bring it up to the minimum poverty level is the underlying purpose of the SSI statute and the accompanying regulations." Jackson v. Schweiker, 683 F.2d 1076, 1082 (7th Cir.1982).

The primacy of this goal of ensuring that persons have enough to meet their basic needs is indicated, for example, in 42 U.S.C. Sec. 407 (incorporated in Subchapter XVI by 42 U.S.C. Sec. 1383(d)(1) (Supp. III 1985)), which provides that social security and SSI "moneys paid or payable ... shall [not] be subject to execution, levy, attachment, garnishment, or other legal process, or to the operation of any bankruptcy or insolvency law." In particular, the primacy of the goal of meeting basic needs over that of preventing dissipation of SSI resources is clearly indicated in Sec. 2612 of the Deficit Reduction Act of 1984, 42 U.S.C. Sec. 1383(b)(1)(B) (Supp. III 1985), which, absent "fraud, willful misrepresentation, or concealment of material information," limits recovery of SSI overpayments to 10% of the applicable SSI rate unless the recipient requests recovery at a higher rate. This provision is inapplicable in this case, because appellant is repaying VA, not SSI, overpayments. But the provision is a sure indicator of congressional intent as to how the goal of meeting basic needs is to be balanced against the policy of preventing dissipation of SSI funds: the former is to prevail. Congress clearly intended that SSI recipients should not, in an SSI overpayment recoupment context, have to survive on incomes more than 10% below SSI standards; and this reflects a more general intention that the primary goal of the SSI scheme is that persons' basic needs must be met.

Basic needs cannot be met with income that is not actually, but only constructively, available. "An increase in 'purchasing power' can only mean an increased ability to pay for goods that are needed or wanted." Jackson, 683 F.2d at 1082. "Phantom income" effects no increase in purchasing power. Id. The Secretary seems to recognize the statute's aim of maintaining real purchasing power, for he defines income as "anything you receive in cash or in kind that you can use to meet your needs for food, clothing, or shelter." 20 C.F.R. Sec. 416.1102 (1986) (emphasis added). Furthermore, in a contemporaneous interpretation that prevailed from 1974 until 1982, the Secretary's regulations stated that "[i]n determining the amount of unearned income the amount actually available to the individual is considered." 20 C.F.R. Sec. 416.1120 (1977). See 39 Fed.Reg. 3674 (Jan. 29, 1974) (adopting regulations); 45 Fed.Reg. 65549 (Oct. 3, 1980) (amending wording but effecting no substantive change). On the "actual availability" requirement, see generally Heckler v. Turner, 470 U.S. 184, 199-204, 105 S.Ct. 1138, 1146-49, 84 L.Ed.2d 138 (1985).

There is every reason to believe that the actual availability standard is a statutory one. See, e.g., Cannuni v. Schweiker, 740 F.2d 260, 264 (3d Cir.1984) (though the statute did not define "resources," the court had "little hesitation in holding that in referring to 'resources' Congress intended the term to mean property the claimant owns or has the current right to use for his own benefit. After all, it is because of the inability to pay for his own subsistence that the...