Jones v. Blinziner
| Decision Date | 29 March 1982 |
| Docket Number | No. L 81-67.,L 81-67. |
| Citation | 536 F. Supp. 1181 |
| Parties | Patricia Sue JONES, on behalf of herself and all others similarly situated, Plaintiff, v. Donald L. BLINZINER, individually and as Administrator of the Indiana Department of Public Welfare; Robert F. Smith, individually and in his capacities including Acting Administrator of the Indiana Department of Public Welfare; Marion N. Steffy, individually and in her capacity as Assistant Administrator of the Indiana Department of Public Welfare, Defendants. |
| Court | U.S. District Court — Northern District of Indiana |
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Lesley M. Guyton, Legal Services Program of Northern Indiana, Inc., Lafayette, Indiana, Peter Cassady, Indianapolis, Ind., for plaintiff.
Linley E. Pearson, Atty. Gen. of Indiana, Indianapolis, Ind., H. Hanley Hammel, Lafayette, Ind., for defendants.
Plaintiff filed this class action on October 2, 1981 seeking preliminary and permanent injunctive relief and declaratory relief against the state defendants to prevent them from enforcing the policies outlined in their Implementation Letters # 1, # 2 and # 3, dated September 1, 4 and 8, 1981, respectively with regard to implementing the amendments to Section 402(a) of the Social Security Act, Public Law 97-35, 95 Stat. 357 (1981). The plaintiff specifically seeks declaratory relief that the "150% rule", as stated in Implementation Letter # 1, as applying to the ratably reduced standard of need instead of the standard of need conflicts with Section 402(a)(18) of the Social Security Act, Public Law 97-35, Section 2303 and thus is invalid under the Supremacy Clause of the Constitution of the United States. The plaintiff also seeks declaratory relief that the notice used by defendants did not conform with 42 U.S.C., Section 602(a)(4), 45 C.F.R. Section 205.10(a)(4) and the Due Process Clause of the Fourteenth Amendment to the Constitution of the United States and therefore the termination of plaintiff and proposed class from the AFDC and Medicaid Programs are illegal and invalid under the Supremacy Clause of the Constitution of the United States. The plaintiff further seeks declaratory relief that all the statements of policy contained in Implementation Letters # 1, # 2 and # 3 are null and void pursuant to I.C. 4-22-2-2 since defendants issued them with the force and effect of law without first having them promulgated, approved and filed as rules in conformity with I.C. 4-22-2-1 et seq.
Finally, the plaintiff and proposed class seek an order enjoining defendants, their successors in office, agents, employees and all persons in concert and participation with them from enforcing any of the policies contained in Implementation Letters # 1, # 2 and # 3 and further ordering the defendants to reinstate and grant to plaintiff and all class members their AFDC and Medicaid benefits to which they were and are otherwise entitled. The plaintiff and proposed class also seek an order requiring defendants to give notice to all members of the class of the court's decision in this matter and of reimbursement procedures for wrongfully denied AFDC and Medicaid benefits.
Also pending in this matter is a Motion to Intervene. Intervening plaintiffs' Amended Motion to intervene raises an additional issue and request for relief. They seek an order enjoining defendants from denying four months of Medicaid coverage to persons whose AFDC benefits are terminated because of increased earned income so far as that policy and practice are contrary to 42 U.S.C., Section 1396a(e).
The defendants maintain that their actions are in conformity with the law and that plaintiffs should be denied any relief. Defendants have also filed a Motion to Dismiss on the grounds that plaintiff lacks standing to bring this action, plaintiff failed to exhaust her administrative remedies, plaintiff failed to state a claim upon which relief can be granted, or in the alternative to join Richard Schweiker, individually and in his official capacity as Secretary of Health and Human Services as an indispensable party. Each of these issues will be addressed separately.
An evidentiary hearing and oral argument was held in Lafayette, Indiana, on October 23, 1981. In accord with the procedure there announced this case is ripe for ruling.
1. The State of Indiana participates in the AFDC and Medical Assistance programs described in Titles IV and XIX of the Social Security Act, 42 U.S.C., Section 601 et seq. and Section 1396 et seq., respectively, through which the federal government partially reimburses participating states for the financial and medical assistance benefits provided to eligible families and for the cost of administration of the programs.
2. As a condition to receiving federal funds, Indiana is required to operate AFDC and Medical Assistance programs in conformity with the requirement of the Social Security Act and implementing federal regulations.
3. Implementation of Pub.Law 97-35 adversely affected a class of more than 61,800 AFDC cases as of September 30, 1981. Joinder of all recipients in those cases would be impracticable.
4. Pearl M. Johnson, Theryl Weber and Rita Thompson were AFDC recipients adversely affected by the implementation of Pub.Law 97-35. Their amended motion to intervene and complaint contained common and closely related questions of law and fact with the original complaint filed in this case. The motion to intervene was timely made and disposition will not prejudice the parties.
5. The defendants' policies and practices regarding implementation of Pub.Law 97-35 adversely affected the AFDC and Medicaid benefits of the named plaintiffs. The plaintiffs have suffered injury per se in the violation of the constitutional due process rights and have suffered injury from the actual as well as threatened loss of AFDC and Medicaid benefits. Further, the plaintiffs have a personal stake in the outcome of this case in that the decision bears directly on their eligibility to receive AFDC and Medicaid benefits. Plaintiffs Patricia Sue Jones, Pearl M. Johnson, Theryl Weber and Rita Thompson have standing to sue.
6. The situations of the named plaintiffs were typical to the class. Further, common questions of law and fact, concerning the actions and policies of the defendants bind the named plaintiffs and their class.
7. Plaintiffs are capably represented by attorneys from the Legal Services Program of Northern Indiana, Inc., who will provide fair and adequate representation for their clients and others similarly situated.
8. A class action is a superior means for adjudicating the issues in this case, particularly for reasons of judicial economy and public policy. The defendants have acted on grounds generally applicable to the entire class of AFDC recipients adversely affected, so relief extending to that class would be appropriate.
9. Defendant, Donald L. Blinzinger, is the Administrator of the Indiana Department of Public Welfare and is responsible for the management and operation of that Department.
10. Defendant, Robert F. Smith, was Acting Administrator of the Indiana Department of Public Welfare during the initial period of change in policy and procedure due to Pub.Law 97-35.
11. Defendant, Marion N. Steffey, is the Director of the Division of Public Assistance of the Indiana Department of Public Welfare.
12. The plaintiffs are challenging the practices and policies of the Indiana Department of Public Welfare and not any particular budget decision of the Department. The fair hearing procedure provided for in administrative appeals cannot provide the relief requested by plaintiffs in this case.
13. The plaintiffs are seeking relief for the allegedly illegal policies and actions of the Indiana Department of Public Welfare with regard to the implementation of Pub.Law 97-35. They are not challenging Pub.Law 97-35 nor the federal regulations promulgated thereto. Richard Schweiker, as Secretary of Health and Human Services, has no vital interest which he will not be able to adequately protect if he is not added as a party nor is he needed in order to grant the complete relief requested.
14. Indiana updated its standard of need in 1969 to its present level pursuant to the Amendments to the Social Security Act of 1967. 42 U.S.C., Section 602(a)(23); 470 I.A.C. 10-3-6 et seq. The present standard of need allows a standardized amount for basic, special and shelter needs.
15. Indiana determines the amount of an AFDC payment by applying a ratable reduction to the total needs of an AFDC recipient. I.C. 12-1-7-3.1.
16. Federal Regulations promulgated in light of the changes made in the Social Security Act by Pub.Law 97-35 define need standard as "the money value assigned by the State to the basic and special needs it recognizes as essential for applicants and recipients." 45 C.F.R. Section 233.20(a)(3)(ii)(E).
17. AFDC cases in which benefits are denied, discontinued, reduced, terminated or suspended due to an initial eligibility determination, a change in client's circumstances or a redetermination of a client's eligibility require a notice which is adequate if it meets the following requirement:
"Adequate" means a written notice that includes a statement of what action the agency intends to take, the reasons for the intended agency action, the specific regulations supporting such action, explanation of the individual's right to request an evidentiary hearing (if provided) and a State agency hearing, and the circumstances under which assistance is continued if a hearing is requested. 45 C.F.R. § 205.10(4)(i)(B).
18. AFDC cases in which benefits are reduced or terminated due to changes in federal and/or state law require a notice which is adequate if it meets the following requirement:
When changes in either State or Federal law require automatic grant adjustments for classes of recipients, timely...
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