Rousseau v. Bordeleau

• Decision Date: 18 December 1985
• Docket Number: Civ. A. No. 84-0538.
• Citation: 624 F. Supp. 355
• Parties: Irene ROUSSEAU and Louise McKenna, Plaintiffs, v. Nancy BORDELEAU, in Her Capacity as Director of the Rhode Island Department of Human Services, Defendant/Third Party Plaintiff, v. Margaret HECKLER, in Her Capacity as Secretary of the Department of Health and Human Services, Third Party Defendant.
• Court: U.S. District Court — District of Rhode Island

624 F. Supp. 355

Irene ROUSSEAU and Louise McKenna, Plaintiffs, v. Nancy BORDELEAU, in Her Capacity as Director of the Rhode Island Department of Human Services, Defendant/Third Party Plaintiff, v. Margaret HECKLER, in Her Capacity as Secretary of the Department of Health and Human Services, Third Party Defendant.

Civ. A. No. 84-0538.

United States District Court, D. Rhode Island.

December 18, 1985.

Barry Best, James Hardy, Rhode Island Legal Services, Providence, R.I., for plaintiff.

Carolyn Lembo, Sp. Asst. Atty. Gen., Providence, R.I., for defendant/third party plaintiff.

Everett Sammartino, Asst. U.S. Atty., Providence, R.I., Nanct Nemon, Deputy Regional Atty., Region I, Boston, Mass., Donald G. Kosin, Jr., Office of the General Counsel, Washington, D.C., for third party defendant.

OPINION

FRANCIS J. BOYLE, Chief Judge.

Plaintiffs seek a declaratory judgment that the policy of the Rhode Island Department of Human Services (DHS) of automatically denying a disability claim for Medical Assistance when the same applicant has been found ineligible for disability payments under the Supplementary Security Income (SSI) Program is a violation of the Social Security Act and the due process clause of the Constitution.¹ Plaintiffs assert that DHS, the state agency responsible for administering the Medical Assistance Program, should be enjoined from denying Medical Assistance when the applicant has been denied disability benefits under the federal SSI Program. The Court grants the requested relief for reasons which follow.

The essential facts giving rise to this action are undisputed. Plaintiff Irene Rousseau is a 60 year old resident of Rhode Island. In January 1984, Plaintiff Rousseau filed a disability claim for SSI benefits with the United States Social Security Administration. SSI is a federal program that provides cash benefits to low income individuals who are aged, blind or disabled. On January 24, 1984, Plaintiff also filed a disability claim with the State of Rhode Island for Medical Assistance. DHS is the state agency which administers the Medical Assistance Program. The Medical Assistance or Medicaid Program pays the medical bills of needy people. Congress established the Medicaid program in 1965 as Title XIX of the Social Security Act to provide federal financial assistance to States choosing to reimburse needy persons for certain medical treatment costs. 42 U.S.C. § 1396 et seq. See Schweiker v. Hogan, 457 U.S. 569, 572, 102 S.Ct. 2597, 2600, 73 L.Ed.2d 227 (1982).

On May 25, 1984, the Social Security Administration denied Plaintiff's application for SSI benefits because she was not disabled as defined in the SSI statute. See 42 U.S.C. § 1382c. Plaintiff has pursued administrative review of the denial of SSI benefits through a hearing before an administrative law judge. She was denied benefits by the administrative law judge. Presently her appeal is pending before the Appeals Council of the Social Security Administration.

On June 1, 1984, Rhode Island Department of Human Services (DHS) notified Plaintiff that her claim for Medical Assistance was denied. This denial of state benefits resulted from the initial denial of federal benefits. DHS did not independently review Plaintiff's disability claim but based its decision entirely on the denial of SSI benefits. This action was a change from earlier policy. Until January 1984, DHS had independently reviewed disability based applications for Medical Assistance whether or not SSI benefits had been denied. In January 1984, pursuant to federal directives from the Department of Health and Human Services, the State began denying disability claims of persons who had been denied SSI benefits. The Rhode Island Department of Human Services (DHS) no longer independently reviewed applications but adopted determinations made by the United States Social Security Administration that an applicant was not totally disabled.

Plaintiff Rousseau claims that she is entitled to Medical Assistance benefits as one who is optional categorically needy. Under the Medical Assistance statute, the State must provide benefits to certain categories of individuals and then it has the option of providing benefits to other categories of individuals. 42 U.S.C. § 1396 et seq. A State participating in the Medical Assistance Program such as Rhode Island must provide assistance to the categorically needy. The categorically needy are those persons receiving federal aid through cash assistance programs such as Aid to Families with Dependent Children (AFDC) and SSI. 42 U.S.C. § 1396a(a)(10)(A). Rhode Island has opted to expand benefits to the optional categorically needy and the medically needy. The optional categorically needy are persons who meet the eligibility requirements of the AFDC or SSI programs (both financial and non-financial) but who are not recipients of AFDC or SSI benefits. 42 U.S.C. § 1396a(a)(10)(A). Plaintiff Rousseau claims that she meets the requirements of the optional categorically needy because she meets the disability requirements of the SSI Program although she does not receive SSI benefits. Plaintiff Rousseau asserts that the State Medical Assistance Program should make an independent review of her claim of disability and should not automatically deny her benefits solely because the Social Security Administration has determined that she is not disabled.

Plaintiff Louise McKenna is a 62 year old resident of Rhode Island. From 1975 to March 1984, Plaintiff McKenna was a recipient of SSI benefits because of a disability. During this time period, Plaintiff McKenna was eligible for Medical Assistance benefits as one who was categorically needy. 42 U.S.C. § 1396a(a)(10)(A). On February 26, 1984, just as she was about to lose her SSI benefits and concomitant Medical Assistance, Plaintiff was notified that her application for Widow's Benefits (under Title II of the Social Security Act) was approved and she began receiving a regular Social Security check of $386 per month. This $386 monthly benefit from Social Security rendered Plaintiff financially ineligible for SSI irrespective of disability. Since Plaintiff's income exceeded the limits for SSI, she did not appeal the determination by the Social Security Administration that she was no longer totally disabled. The State refuses Medical Assistance benefits to her.

On or about June 6, 1984, Plaintiff McKenna filed a claim for Medical Assistance with DHS which was based on total disability. Although her income exceeded the income guidelines for SSI, it was less than the maximum limits for Medical Assistance. Plaintiff McKenna asserts that she was eligible for Medical Assistance under the category of medically needy. The medically needy are persons who are unable to pay medical expenses whose incomes are too high for other federal financial assistance programs but whose incomes are within Rhode Island's financial guidelines for Medical Assistance; medically needy have the same characteristics as the categorically needy. Massachusetts Association of Older Americans v. Sharp, 700 F.2d 749 (1st Cir.1983). DHS did not independently review Plaintiff's disability claim but automatically found her ineligible for benefits solely because of the earlier finding by the Social Security Administration that she was not disabled. Plaintiff McKenna asserts that the policy of automatically denying her disability claim for Medical Assistance because of a Social Security Administration finding that she was not disabled as defined in the Social Security Statute 42 U.S.C. § 1382c violates 42 U.S.C. § 1396 et seq. of the Social Security Statute. Plaintiff contends that DHS is required to make an independent and impartial evaluation of her disability claim irrespective of a Social Security Administration determination regarding disability.

The parties to this action agree that before January 1984, DHS made its own determination regarding disability claims for Medical Assistance. Further, the parties agree that both the Medical Assistance Program and the SSI Program use the same definition of disability when evaluating a disability claim. The parties also agree that despite the use of the same standards, due to the complexity of the matters involved and the subjective element involved in resolving close questions, two different agencies applying the same standards may reach different results. It is possible that under the same circumstances the Social Security Administration could find that Plaintiffs Rousseau or McKenna did not meet the disability requirements of 42 U.S.C. § 1382c, and that DHS could find that they did meet the disability requirements defined in 42 U.S.C. § 1382c and would therefore be eligible for Medical Assistance.

The United States Department of Health and Human Services has not adopted a regulation which requires denial of benefits by a State solely because an applicant has been denied SSI benefits. It is the present policy of DHS imposed upon it by the United States Department of Health and Human Services that it must adopt a federal finding of no disability.

Plaintiffs correctly contend that although the Medical Assistance Program was created by the Social Security Act and is governed by that Act and the regulations promulgated by the Secretary of Health and Human Services, it is a program administered entirely by the States. States administer their programs according to their "state plans." 42 U.S.C. § 1396a(a).

Defendant/Third Party Plaintiff Bordeleau, Director of the Rhode Island Department of Human Services asserts that the State's conduct in the administration of the Medical Assistance Program is in accord with the statute and regulations. She attributes changes in DHS's policy regarding disability determinations to policy directives from the Defendant Secretary of Health and Human Services.

The Secretary of Health and Human Services relies on the legislative history of 42 U.S.C. § 1396a(a)(10) and...