Ussery v. Kansas Dept. of Social and Rehabilitation Services

• Decision Date: 14 July 1995
• Docket Number: No. 72324,72324
• Citation: 258 Kan. 187,899 P.2d 461
• Court: Kansas Supreme Court
• Parties: , 48 Soc.Sec.Rep.Ser. 667, Medicare & Medicaid Guide P 43,536 William USSERY, Appellee, v. KANSAS DEPARTMENT OF SOCIAL AND REHABILITATION SERVICES, Appellant.

Page 461

899 P.2d 461

258 Kan. 187, 48 Soc.Sec.Rep.Ser. 667,

Medicare & Medicaid Guide P 43,536

William USSERY, Appellee, v. KANSAS DEPARTMENT OF SOCIAL AND REHABILITATION SERVICES, Appellant.

No. 72324.

Supreme Court of Kansas.

July 14, 1995.

Syllabus by the Court

1. A state, in administering its Medicaid program, must set reasonable standards for assessing an individual's income and resources in determining eligibility for, and the extent of, medical assistance under the program. Those standards must take into account only such income and resources as are available to the applicant or recipient as determined in accordance with standards prescribed by the Secretary of Health and Human Services. 42 U.S.C. § 1396a(a)(17)(B) (1988).

2. "Patient liability" for Medicaid care is defined in Kansas Administrative Regulations as "the amount the individual is required to pay towards the cost of care which the individual received in an institutional arrangement. It is based on the amount of applicable income that exceeds the protected income level in the eligibility base period." K.A.R. 30-6-53(a)(3) (1993 Supp.).

3. K.A.R. 30-6-106(m)(2) (1993 Supp.) grants an allowance to the "community spouse" of a Medicaid recipient in calculating "patient liability." The term "spouse" must be given its common meaning. "Spouse" means one's husband or wife. Black's Law Dictionary 1402 (6th ed.1990). "Husband" means a married man who has a lawful wife, and "wife" means a woman united to a man by marriage; a woman who has a husband living and undivorced. Black's Law Dictionary 741, 1598 (6th ed. 1990).

4. The plain language of K.A.R. 30-6-106(m)(2) (1993 Supp.) grants an allowance only to a "community spouse." It grants no similar allowance to an ex-spouse, nor does any other provision grant a similar allowance to an ex-spouse.

5. While the courts of this state need not always accept an administrative agency's interpretation of its own regulations, it has long been recognized that in order to insure effectiveness and uniformity, an agency's interpretation of its regulations will be given great weight and, in some cases, controlling weight.

6. It is a fundamental rule of statutory construction that when a statute is plain and unambiguous, this court must give effect to the intention of the legislature as expressed rather than determine what the law should or should not be.

7. An ex-spouse is not a "community spouse" for Medicaid purposes; therefore, K.A.R. 30-6-106(m)(2) (1993 Supp.) provides no allowance from patient liability for court-ordered maintenance paid to an ex-spouse.

Beth Lange Engle, of the Kansas Dept. of Social and Rehabilitation Services, argued the cause, and Reid Stacey, of the same dept., was on the briefs for appellant.

Mary Patricia Hesse, of Redmond, Redmond & Nazar, Wichita, was on the brief for appellee.

ABBOTT, Justice:

This case involves judicial review of an agency action. In calculating William Ussery's patient liability for Medicaid benefits, the Kansas Department of Social and Rehabilitation Services (SRS) included as part of his income a court-ordered support obligation to his former spouse. On Ussery's petition for judicial review, the district court reversed the agency's determination that the court-ordered support obligation was available income. The real issue before this court is whether maintenance paid to a former spouse is treated differently than voluntary support or court-ordered maintenance for a current spouse.

The facts are undisputed. On January 4, 1993, William Ussery's wife, Ruby, filed a petition for divorce. On that day, the district court with jurisdiction over the divorce proceedings ordered William Ussery to pay temporary maintenance of $500 per month. On January 17, 1993, Ussery was hospitalized and then was discharged to a nursing home on March 11, 1993, where he remains. Ussery's daughter was appointed as his guardian and conservator. On April 14, 1993, a Journal Entry of Judgment and Decree of Divorce was entered granting the divorce and ordering Ussery to pay Ruby maintenance in the amount of $495 per month. All real and personal property (except Ussery's personal effects), including Ussery's pensions from Getty and Texaco, were awarded to his former spouse, as were the couple's debts. Only the maintenance is at issue here; the other distribution is not.

On April 16, 1993, Ussery filed an application for Medicaid benefits. On May 28, 1993, Ussery was notified that SRS had approved his Medicaid application and that his eligibility was effective as of April 1, 1993. Ussery's only source of income is $1,060 per month from Social Security. SRS determined that Ussery's share of his medical expenses, the "patient liability" or "patient obligation," was $934.60 per month for April and May and thereafter $970.60 per month.

Ussery's combined monthly patient liability of $970.60 and monthly maintenance obligation of $495 exceed his monthly income of $1,060. Ussery exhausted his administrative remedies in seeking to reduce his patient liability, but his efforts failed. He then filed a petition for judicial review in the district court. The district court held that SRS had erroneously interpreted the law in failing to deduct the court-ordered support obligation from Ussery's "available income." The court declined to address a constitutional argument (denial of equal protection) made by Ussery. The court ordered SRS to recalculate Ussery's patient obligation by deducting the court-ordered support.

SRS timely appealed to the Court of Appeals. In his appellate brief, Ussery asked the Court of Appeals to address the constitutional argument not addressed by the district court. Upon motion by SRS, the Court of Appeals issued an order striking Ussery's appellate argument concerning the constitutional issue. Thereafter, the appeal was transferred to this court on this court's own motion pursuant to K.S.A. 20-3018(c).

Our standard of judicial review of an agency action under the Kansas Act for Judicial Review and Civil Enforcement of Agency Actions, K.S.A. 77-601 et seq., is statutorily defined. Among the grounds for relief are that the agency has erroneously interpreted or applied the law or that the agency action, or the statute or rule and regulation upon which the agency action is based, is unconstitutional on its face or as applied. K.S.A. 77-621(c)(1), (4).

Background on the federal Medicaid program was recently stated by the Second Circuit Court of Appeals in Himes v. Shalala, 999 F.2d 684, 686 (2d Cir.1993):

"The Medicaid program was enacted in 1965 as Title XIX of the Social Security Act, 42 U.S.C. §§ 1396, 1396a-u (1988) ('Medicaid Act' or 'the Act'), as a cooperative federal-state program designed to provide health care to needy individuals. Although a state is not required to participate in the Medicaid program, once it chooses to do so it must develop a plan that complies with the Medicaid statute and the Secretary's regulations. [Citation omitted.]

"A state, in administering its Medicaid program, must set reasonable standards for assessing an individual's income and resources in determining eligibility for, and the extent of, medical assistance under the program. See 42 U.S.C. § 1396a(a)(17). Those standards must take into account 'only such income and resources as are, as determined in accordance with standards prescribed by the Secretary [of Health and Human Services], available to the applicant or recipient.' 42 U.S.C. § 1396a(a)(17)(B) (emphasis added)."

Kansas has elected to participate in the Medicaid program. K.S.A. 39-708c gives the Secretary of SRS the power and duty to determine general policies relating to all forms of social welfare and to adopt rules and regulations therefor. K.S.A. 39-708c(s) requires the Secretary of SRS to develop plans financed by federal funds and/or state funds for providing medical care for needy persons. Pursuant to that statute, the Secretary of SRS adopted regulations found at K.A.R. 30-6-34 et seq. SRS has also published the Kansas Public Assistance Manual (KPAM), detailing Medicaid eligibility and benefits.

Both parties agree that Ussery was determined to be eligible for Medicaid benefits. The issue here is not whether Ussery is eligible for benefits, but rather the extent of his patient liability. "Patient liability" for Medicaid care is defined as "the amount that the individual is required to pay towards the cost of care which the individual receives in an institutional arrangement. Patient liability is based on the amount of applicable income that exceeds the protected income level in the eligibility base period." K.A.R. 30-6-53(a)(3) (1993 Supp.). Ussery contends that the court-ordered support obligation to his ex-wife should reduce his patient liability.

The trial court cited three statutes and regulations in its decision giving Ussery a reduction for the maintenance order. First, the court cited 42 U.S.C. § 1396a(a)(17)(B) (1988) in framing the issue, the text of which is quoted here:

"(a) A State plan for medical assistance must--

....

(17) except as provided in subsections (l )(3), (m)(3), and (m)(4) of this section, include reasonable standards ... for determining eligibility for and the extent of medical assistance under the plan which ... (B) provide for taking into account only such income and resources as are, as determined in accordance with standards prescribed by the Secretary, available to the applicant or recipient and ... as would not be disregarded ... in determining his eligibility for such aid, assistance, or benefits...." (Emphasis added.)

The trial court also cited 42 U.S.C. § 1396r-5 (1988) and K.A.R. 30-6-106(m)(2) and (3) (1993 Supp.). These provisions grant a monthly income allowance for the community spouse or family of an institutionalized spouse; the amount of that allowance shall not be considered in calculating the amount of patient liability.

The trial court's reasoning...