Adams v. Secretary of Health and Human Services

• Decision Date: 22 September 1986
• Docket Number: No. 85-1265.,85-1265.
• Citation: 653 F. Supp. 249
• Parties: Robin ADAMS, Plaintiff, v. SECRETARY OF HEALTH AND HUMAN SERVICES OF the UNITED STATES of America, Defendant.
• Court: U.S. District Court — Central District of Illinois

653 F. Supp. 249

Robin ADAMS, Plaintiff, v. SECRETARY OF HEALTH AND HUMAN SERVICES OF the UNITED STATES of America, Defendant.

No. 85-1265.

United States District Court, C.D. Illinois, Peoria Division.

September 22, 1986.

Mark T. Campbell, Prairie State Legal Services, Inc., Peoria, Ill., for plaintiff.

L. Lee Smith, Asst. U.S. Atty., Peoria, Ill., for defendant.

ORDER

MIHM, District Judge.

The Plaintiff, Robin Adams, has filed suit seeking review of a final decision by the Secretary of the United States Department of Health and Human Services finding that she had received an overpayment of child's benefits to her daughter, Melissa Hibser, in the amount of $2,223.60 and denying waiver of that amount. The benefits had been paid pursuant to 42 U.S.C. §§ 402(d), 405, 416, and 1302. Judicial review is permitted and defined by 42 U.S.C. § 405(g).

In order to qualify for a waiver of reimbursement under the Social Security Act, a person must be "without fault" and there must be a showing that the requirement to return the overpayment would defeat the purpose of the Act or be against equity and good conscience.

The burden of proof is on Plaintiff to establish the absence of fault and the injury to the purposes of the Act or equity or good conscience.

Judicial review of an Administrative Law Judge's (ALJ) findings pursuant to these standards is limited to scrutiny of the record in its entirety and a determination of whether each essential element of the administrative findings is supported by substantial evidence. 42 U.S.C. § 405(g); Lechelt v. Cohen, 428 F.2d 214 (7th Cir. 1970); Strickland v. Harris, 615 F.2d 1103 (5th Cir.1980). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Richardson v. Perales, 402 U.S. 389, 91 S.Ct. 1420, 28 L.Ed.2d 842 (1971). In making this determination, the Court must be extremely cautious to avoid substituting its judgment for that of the ALJ, Strickland v. Harris, supra) but may also not relieve itself of the problem of considering and resolving complex issues by "uncritical rubberstamping of the administrative action." Stark v. Weinberger, 497 F.2d 1092 (7th Cir.1974).

If there is a conflict in the evidence, the burden is upon the claimant to prove that he or she meets the requirements of eligibility. Johnson v. Weinberger, 525 F.2d 403, 407 (7th Cir.1975). In addition, an Administrative Law Judge's credibility determination regarding subjective evidence should be given considerable weight by the court. Bibbs v. Secretary of Health, Education & Welfare, 626 F.2d 526, 528 (7th Cir.1980); Zblewski v. Schweiker, 732 F.2d 75 (7th Cir.1984); Zalewski v. Heckler, 760 F.2d 160 (7th Cir.1985).

Since the formulation of the local procedure for handling Social Security appeals, the Court's attention has been directed to the case of Garcia v. Califano, 463 F.Supp 1098 (N.D.Ill.1979). In that action, the Court held that motions for summary judgment are "procedural improper vehicles for a decision on the merits" in Social Security disability cases. The Court believes this to be a proper interpretation and will, accordingly, treat the pleadings in the present case as Plaintiff's motion to reverse and Secretary's motion to affirm.

Robin Adams is the mother of Melissa L. Hibser (who was ten years old on March 7 of this year) and the divorced wife of Roy Hibser. The Social Security Administration had determined that Mr. Hibser was disabled and entitled to receive benefits and, on August 1, 1978, Plaintiff signed an application prepared by Roy Hibser for benefits for Melissa as permitted by 42 U.S.C. § 402(d). Payments on the child's behalf began in January, 1979 and continued until June of 1982 when they were discontinued by the Administration.

Apparently, during that period of time, Roy Hibser had been performing substantial, gainful work while continuing to collect his disability benefits. The Social Security Administration learned of his deception and, in February of 1982, advised Plaintiff that there appeared to have been an overpayment of benefits to Melissa and that she had ten days to present additional evidence for consideration. She was told that she would be advised when a formal determination was made. There was no further communication between the Administration and Plaintiff and all payments were discontinued effective the end of June, 1982.

On November 12, 1983, Plaintiff received a letter which informed her that the original overpayment was $10,806.10 but that, because she had not been notified until February 1982 of any problem, that $8,582.50 would be excused. The Officer of Disability Operations told her that the Administration would not, however, relieve her of the obligation to repay the balance of $2,223.60 for the period February 1982 through June 1982. Ms. Adams sought and was granted a meeting with claims representatives of the Administration and, on January 4, 1984, the revised overpayment was confirmed and waiver was denied. She was informed of this decision by letter dated March 9, 1984.

On that same day she requested a hearing on the overpayment; that hearing was held on July 12, 1984 before an Administrative Law Judge. On July 30, 1984, the ALJ issued his decision affirming the earlier denial of waiver by the Administration. Thereafter, on October 11, 1984, Plaintiff sought review of the matter by the Appeals Council and on April 25, 1985, the Council upheld the ALJ's decision. That action became the final decision of the Secretary.

The only issue before the Court in this action is whether the final decision of the Secretary is supported by substantial evidence in the record.

ANALYSIS AND DECISION

Plaintiff has no quarrel with the decision of the Social Security Administration that there was an overpayment because of Roy Hibser's apparent duplicity or that, as a result of his activity, her daughter Melissa became ineligible for continued payment of child's insurance benefits. Plaintiff only objects to being held responsible for reimbursing the Social Security Administration for the overpayment to Melissa.

Overpayments and underpayments of benefits are covered under 42 U.S.C. § 404 which is quoted here in pertinent part:

"§ 404. Overpayments and Underpayments

(a) Procedure for Adjustment or Recovery

Whenever the Secretary finds that more or less than the correct amount of payment has been made to any person under this subchapter, proper adjustment or recovery shall be made, under regulations prescribed by the Secretary, as follows:

* * * * * *

(b) No Recovery from Persons Without Fault

In any case in which more than the correct amount of payment has been made, there shall be no adjustment of payments to, or recovery by the United States from, any person who is without fault if such adjustment or recovery would defeat the purpose of this subchapter or would be against equity and good conscience."

The Court reads this section as establishing a two-pronged test for determining whether reimbursement of the overpayment can be waived. One receiving benefits in an excessive amount may be relieved of the obligation to return the surplusage if:

(1) the person is without fault, and

(2) adjustment or recovery would either:

(a) defeat the purpose of Title II of the Act, or

(b) be against equity and good conscience.

The ALJ made the initial determination that Plaintiff was not "without fault" and, therefore, never reached the second step of the analysis. The Social Security Administration had already found that Robin Adams had no knowledge of Roy Hibser's wrongful acceptance of disability payments prior to receiving the letter from them on February 15, 1982. The finding that she bore some fault between February and June must necessarily turn on the contents of that letter since she had no other contact with the agency before the payments were stopped. Because of this fact, the letter is reproduced here in its entirety.

"Dear Mrs. McGowan:

This notice pertains to the benefits you are receiving on the claim of Melissa L. Hibser. Based on the evidence now in file, it appears that a determination will have to be made that Roy Hibser has the ability to engage in substantial gainful activity as of February 1980, and, in accordance with the law, is no longer disabled. Accordingly, all benefits being paid on that claim will be stopped. The purpose of this notification is to give you an opportunity to present any additional evidence for consideration.

Unless we hear from you within ten days from the receipt of this notice, we will make a formal determination based on the evidence in file. It is important, therefore, that you submit any statements or evidence you wish to be considered within ten days or let us know if more time is needed.

You will be informed in writing when a formal determination is made."

The letter was signed by C. Mailloux who was a claims representative for the agency.

The Secretary has argued, and the Court fully concurs, that this letter, constituting alleged misinformation or lack of pertinent information furnished by an employee of the Government, cannot work an estoppel against the Secretary. Schweiker v. Hansen, 450 U.S. 785, 101 S.Ct. 1468, 67 L.Ed.2d 685 rehearing denied 451 U.S. 1032, 101 S.Ct. 3023, 69 L.Ed.2d 401 (1981); Cheers v. Secretary of Health, Education and Welfare, 610 F.2d 463 (7th Cir.1979); Abbott v. Harris, 610 F.2d 563 (8th Cir. 1979); Goldberg v. Weinberger, 546 F.2d 477 (2nd Cir.1976). The issue here is not estoppel of the Government but, rather, whether, being in possession of the information imparted in the letter, it may fairly be found that Plaintiff was "without fault" in having accepted benefit checks between February and June of 1982.

The Court is mindful of its obligation to forego the temptation to substitute its judgment for that of the ALJ and would certainly defer to that judgment if the letter disclosed anything which supported it.

The...