Knight v. Bowen

690 F. Supp. 1121, 1987 U.S. Dist. LEXIS 13605, 1988 WL 70337
CourtDistrict Court, D. Massachusetts
DecidedJune 30, 1987
DocketCiv. A. Nos. 80-892-K, 80-2088-K and 85-224-K
StatusPublished

This text of 690 F. Supp. 1121 (Knight v. Bowen) is published on Counsel Stack Legal Research, covering District Court, D. Massachusetts primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Knight v. Bowen, 690 F. Supp. 1121, 1987 U.S. Dist. LEXIS 13605, 1988 WL 70337 (D. Mass. 1987).

Opinion

KEETON, District Judge.

By agreement of the parties, this case was submitted to the court for decision based upon the administrative record and the parties’ recent submissions, (Docket Nos. 49, 50, 53, 56, and 57). This case arose from the decision by the defendant, the Secretary of Health and Human Services (“Secretary”), to reduce the Supplementary Security Income grants received by the plaintiffs and the members of the class they represent which was certified by Or[1123]*1123der of this court dated November 24, 1986. At issue is the Secretary’s policy, first implemented in 1977, of recalculating the amounts, fixed in January of 1974, of the plaintiffs’ Minimum Income Levels (MIL). Plaintiffs contend that the practice of reexamining benefit determinations and reducing the corresponding benefit payments violates the Secretary’s regulations, the Social Security Act (“the Act”), and the due process clause of the Fifth Amendment. Accordingly, they urge this court to enter an order:

(1) enjoining any MIL reductions, after January 1, 1976, for reasons other than fraud, changes in ‘special needs or circumstances,’ or receipt of food stamps;
(2) requiring the Secretary to reinstate class members’ higher MIL levels; and
(3) requiring the Secretary to reimburse class members for benefits erroneously reduced, including overpayments recouped as a result of the MIL reductions.

Memorandum in Support of Plaintiffs’ Motion for Judgment on Class Issues at 51-52 (Docket No. 50).

Plaintiffs do not now press the issues pertinent only to the claims brought in their individual capacities, but reserve their rights to assert these claims in later proceedings.

I.

This case has its genesis in the assumption by the federal government of primary responsibility for the support of the blind, aged, and disabled in the Commonwealth of Massachusetts. Until 1974, each state administered its own program of aid to the blind, aged and disabled and each was partially reimbursed by the federal government pursuant to Titles I, X, XIV, and XVI of the Social Security Act. In January of 1974, the state programs were brought under the auspices of the federal government which chose to administer this aid through the Supplemental Security Income (SSI) program, 42 U.S.C. § 1302 et seq. In connection with the transfer of responsibility for the aid programs, Congress sought to address the problem posed by the fact that the difference in the schemes for calculating both eligibility for and the amount of benefits created the danger that certain individuals would suffer a decrease in their benefit levels. Congress responded to this problem by “grandfathering” the benefit levels of the recipients of aid under the state program; the recipients were guaranteed that their Minimum Income Level (“MIL”) under SSI would equal their “December, 1973 income” under their respective state programs. Pub.L. No. 93-66 § 212 (reprinted as a note to 42 U.S.C.A. § 1382). The amount of the recipient’s MIL was to be determined by adding the recipient’s December 1973 state benefit and the recipient’s other December 1973 income.

The federal government did not undertake full fiscal responsibility for maintaining the MIL. Instead, it required the states to provide, as a condition for reimbursement under Title XIX of the Social Security Act, supplementary benefits (“mandatory supplements”) which were, for Massachusetts citizens, issued as part of the monthly SSI benefits checks. Agreement Between the Secretary of Health, Education and Welfare and the State of Massachusetts at 5.

The amount of the mandatory supplement awarded to each recipient was to equal the difference between the recipient’s MIL and the sum of the recipient’s SSI benefit and the recipient’s other income. The words “other income” refer to income that would have been counted by the state in 1973 under the rules of the state aid program or state countable income (“SCI”), 20 C.F.R. §§ 416.2050(a)(1), 416.2050(b)(2). As plaintiffs correctly state, “the formula for mandatory supplementation, simplified to address only the factors relevant [to this case], is as follows:

December 1973 Grant + Other Income

— Current SSI + Other Income

= Mandatory State Supplement”

Memorandum in Support of Plaintiff’s Motion for Judgment on Class Issues, at 4.

Although the Secretary’s regulations provided for the use of SCI in the calculation of the Minimum Income Level, the Secretary did not use SCI to determine the [1124]*1124MIL of Massachusetts residents. Instead, the Secretary used the income counting rules of the new SSI program, sometimes called federal countable income ('‘FCI”). Memorandum from Associate Commissioner dated August 30, 1977 (Plaintiffs’ Appendix D, Ex. 1). The MILs calculated using FCI remained in place until early 1977.

In early 1977, the Secretary began a systematic reexamination of those cases where the Secretary expected that the use of SCI in determining the MIL was likely to produce a different result from the use of FCI. In connection with this reexamination, the Secretary asked the Commonwealth of Massachusetts to review the conversion data of these selected recipients for accuracy and requested the state to recalculate MILs using SCI rather than FCI to determine the value of December 1973 Other Income. Pursuant to these accuracy reviews and the recalculations the Secretary reduced the MILs calculated in 1974 and ordered a corresponding reduction in the mandatory supplements of many Massachusetts residents.

II.

Named plaintiffs Virginia Knight and Anna O’Malley filed separate class action complaints in which they challenged, among other things, the Secretary’s policy of reexamining and reducing the MIL determinations made in January of 1974.

Mrs. Knight received assistance from the Massachusetts Old Age Assistance Program (“MOAA”) until January 1974 when the federal government, through SSI, assumed responsibility for her benefit payments. At that time, as stated in the November Memorandum, the Secretary deemed Mrs. Knight’s December 1973 MOAA income to be her MIL.

On April 26,1979, Mrs. Knight received a notice from the Secretary that her SSI benefit was being reduced; the Secretary had determined that her MIL had been incorrectly computed in 1974. Administrative Law Judge’s (“AU”) Decision at 8 (November 8, 1979). On November 14, 1979, there was a hearing before an AU on the issue of the reduction of Mrs. Knight’s SSI benefits and the AU upheld the decision. Id. The Appeals Council later denied Mrs. Knight’s request for for review. Thus, the decision of the Secretary became final. Although Mrs. Knight died since commencing the proceedings in this court, dismissal of her claims has been deferred pending the outcome of this class action; the facts of her case were considered helpful to decision.

Plaintiff O’Malley is 93 years old. See AU’s Decision at 10 (May 5, 1980). Like Mrs. Knight, Mrs. O’Malley is a former recipient of MOAA benefits. Id. At the time that the benefit payments to Mrs. O’Malley were assumed by the Secretary, her December 1973 income was deemed her MIL. Id. On April 13, 1979, Mrs.

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Bluebook (online)
690 F. Supp. 1121, 1987 U.S. Dist. LEXIS 13605, 1988 WL 70337, Counsel Stack Legal Research, https://law.counselstack.com/opinion/knight-v-bowen-mad-1987.