Buckles v. Weinberger

• Decision Date: 01 August 1975
• Docket Number: Civ. A. No. 74-2885.
• Citation: 398 F. Supp. 931
• Parties: Marie BUCKLES et al. v. Caspar WEINBERGER, Secretary of Health, Education and Welfare Department.
• Court: U.S. District Court — Eastern District of Pennsylvania

398 F. Supp. 931

Marie BUCKLES et al. v. Caspar WEINBERGER, Secretary of Health, Education and Welfare Department.

Civ. A. No. 74-2885.

United States District Court, E. D. Pennsylvania.

August 1, 1975.

COPYRIGHT MATERIAL OMITTED

Linda M. Bernstein, Community Legal Services, Inc., Philadelphia, Pa., for plaintiffs.

Kenneth A. Ritchie, Asst. U.S. Atty., Philadelphia, Pa., Larry H. Bailine, Philadelphia, Pa., for defendant.

OPINION

FOGEL, District Judge.

In this class action brought by Marie Buckles, Felicita Alicea, and Nicholas Smeraski, plaintiffs seek to enjoin the Secretary of Health, Education and Welfare, and his agents and delegates, from terminating their Supplemental Security Income (SSI) benefits without advance notice, and the opportunity for a hearing prior to the cessation of such payments to them.

We entered a Preliminary Injunction on December 20, 1974, 387 F.Supp. 328, and ordered the Secretary to pay SSI benefits to a class determined pursuant to Rule 23(b)(2) of the Federal Rules of Civil Procedure, which consisted of those persons in the Commonwealth of Pennsylvania who (1) had received SSI benefits on or after January 1, 1974, (2) had received state aid to the disabled on or before December 31, 1973, (but not before July 1, 1973), and (3) whose benefits had been, or would be terminated, suspended, or reduced, without notice, and without being given a hearing prior to any termination, suspension or reduction of payments to them.

On January 28, 1975, defendant petitioned the Court to modify the Preliminary Injunction in order to limit the class that had been previously determined to those persons who had already filed or would file a timely request for reconsideration and a hearing pursuant to 20 C.F.R., Part 416, Subpart N, or whose time limit for filing such request for reconsideration and/or a hearing had not expired at the time of the entry of the Preliminary Injunction. We denied this motion without prejudice to defendant's right to seek modification of the class in conjunction with the final order to be entered in this matter.

All parties have agreed that a final determination may be made on the basis of the record developed at the hearing before us on December 18, 1974, which includes the Stipulation presented to the Court on that date, and the memoranda and supplementary materials filed thereafter at our request. Upon consideration of this augmented record, we conclude that a permanent injunction should issue in favor of plaintiffs and the class which they represent.

We shall discuss the issues presented by this controversy in the following order: (1) the legislative and administrative history of the SSI program; (2) the factual basis for plaintiffs' claims; (3) the merits of the case under the due process clause of the Fifth Amendment; (4) the statutory authority to make payments after December 31, 1974; and (5) the form and effect of the final injunction we will enter.

1. The legislative and administrative history of the SSI program.

Because the subject matter of this action has been frequently litigated in the District Courts,¹ we shall limit our discussion to a broad outline of the SSI program.

It was enacted by Congress in October of 1972, Pub.L. 92-603, 86 Stat. 1465, 42 U.S.C. § 1381 et seq., to replace inter alia, the joint state-federal program known as Aid to the Permanently and Totally Disabled (APTD). The effective date of the SSI legislation was January 1, 1974. The program initially provided that persons who were permanently and totally disabled, as defined under any state plan in effect during the month of October 1972, and who were receiving aid under such plan on the basis of disability during the month of December, 1973, would automatically qualify as disabled persons who were eligible to receive SSI benefits. On December 31, 1973, however, one day before the program was to go into effect, Congress amended the statute by adding to this "grandfather" provision the additional requirement that a potential recipient must have received disability payments under a state plan for at least one month prior to July of 1973, Pub.L. 93-233, 87 Stat. 957. This new proviso, codified in 42 U.S.C. § 1382c (a)(3)(E), had the effect of requiring a disability determination with respect to those persons who had received state aid during the month of December of 1973, but not for any month prior to July of 1973, a class of persons which would automatically have been considered as eligible for disability payments under the old "grandfather" provision.

The SSI program, however, was to become effective the day following the passage of Pub.L. 93-233; hence, the Social Security Administration was unable to make eligibility determinations with respect to these so-called "rollback" individuals before payments were scheduled to begin. Under the circumstances, the agency elected to make payments to all members of the class, pending a determination of eligibility. These payments were purportedly made pursuant to the provisions of 42 U.S.C. § 1383(a)(4)(B), which permitted payments to "presumptively disabled" persons prior to a determination of their eligibility, without subjecting such persons to liability for recoupment of overpayments, should they ultimately be found to be ineligible. Section 1383 (a)(4)(B), however, limited such payments to a three month period which was to expire on March 31, 1974. The agency was unable to complete eligibility determinations by that time; it accordingly asked Congress to extend the period of presumptive disability until December 31, 1974. See H.R. No. 93-871, 93d Cong., 2d Sess., U.S.Code Cong. & Admin.News 1974, p. 2808. Congress agreed, and passed Pub.L. 93-256, 88 Stat. 52 (Mar. 28, 1974), which permitted presumptive disability payments during the entire calendar year of 1974, without liability for repayment if the recipients were subsequently found to be ineligible.

The administrative burden on the agency to process these "rollback" cases was so great, however, that by December of 1974, it was clear that disability determinations could not be completed by the end of that calendar year. On December 2, 1974, James B. Cardwell, Commissioner of Social Security, wrote to then Chairman Wilbur Mills of the House Committee on Ways and Means to report that the agency intended to continue to make SSI payments after December 31, 1974, to those individuals with respect to whom determination of eligibility under the federal criteria had yet to be made. The reason for this decision was that potential eligibles and ineligibles were intermingled in the remaining unprocessed caseload, and the agency would therefore be compelled either to pay all or none of these persons. Commissioner Cardwell stated that "as a matter of good administration, elemental fairness, and proper treatment of beneficiaries and claimants, the agency should continue payments to all of the individuals until the SSI eligibility determination is made and effectuated, even though some individuals will thereby be paid who will eventually be found to be rollbacks who do not meet SSI disability criteria."² With respect to the time limitation in Pub.L. 93-256, Commissioner Cardwell noted that "we view the expiration of the period specified in P.L. 93-256 as ending the time when payments can be made on the basis of presumptive disability and not be considered overpayments."³

Within this legislative and administrative framework, we will consider the underlying factual situation.

2. The factual basis for the plaintiffs' claims in this action.

The named and class plaintiffs are "rollback" individuals, who received APTD payments from the Commonwealth of Pennsylvania in December of 1973, but not for any month prior to July 1, 1973. During December, 1973, each received a notice from the Social Security Administration stating in substance the following:⁴

You do not need to file an application to get supplemental security income. A gold colored check for the amount shown above * * * will come to you automatically about the first day of each month. This check will take the place of the checks you now get from your state or local public assistance office.

Plaintiffs were never asked to submit any additional information with respect to their eligibility for the SSI program; accordingly, they took no further action to ensure their eligibility, and, in fact, their checks began arriving about the first of each month.⁵

At some point in time thereafter, the agency did decide that plaintiffs were not eligible for SSI payments, because they allegedly had failed to satisfy the criteria for disability mandated under the federal statute. Each plaintiff received a form letter⁶ stating that, after a "careful review" of the evidence in the case, the Social Security Administration had determined that these recipients were ineligible, and that payments would be stopped. On the back of this form, plaintiffs were notified of their right to request a reconsideration of the agency's decision within thirty days of receipt of the notice. Such reconsideration, however, does not provide either an opportunity for personal testimony nor for cross-examination of adverse witnesses. Further, it is clear that such reconsideration, and, indeed, the entire appeal process in 20 C.F.R., Part 416, Subpart N, is available to a terminated recipient only after benefits have been discontinued. If the reconsideration determination is adverse to the claimant, he can request an evidentiary hearing before an administrative officer. This hearing, however, may not take place for many months;⁷ during this hiatus, all benefits cease.

This action was filed in November of 1974; plaintiffs seek declaratory and injunctive relief against the termination of SSI payments prior to a full and fair hearing on the issue of eligibility. As noted above, we entered a Preliminary Injunction after hearing, based upon plaintiffs' showing that a serious and...