HIV AIDS Resource Guide/HIV-AIDS Resource Guide.iso/STAT/CASES/ANDERSON.ASC

Text File | 1993-01-14 | 15KB | 331 lines

/* This case was reported in 806 F.Supp 134 (E.D.Tex. 1992). In
this case, the Court finds that because social security appeals
processes are known to be cumbersome and long, and given the
short life expectancy of the HIV positive applicant, the Court
would hear the case at once. Practitioners may find this argument
of use in several different arenas. */



Ronnie Lee ANDERSON

v.

W. SULLIVAN, M.D., Secretary Health and Human Services.

United States District Court, E.D. Texas, Beaumont Division.

September 10, 1992.



ORDER

COBB, District Judge.

Ronnie Lee Anderson, a disabled individual who receives
Supplemental Security Income (SSI) benefits, challenges the
method used by the Social Security Administration (SSA) to
calculate the amount of SSI benefits for the first three months
of his eligibility for SSI.  The defendant, the Secretary of
Health and Human Services (the Secretary), moves to dismiss this
action for lack of subject matter jurisdiction on the ground that
Anderson failed to exhaust his administrative remedies.



FACTS

In May 1991, Anderson was employed by Wyatt's Cafeteria in
Beaumont, Texas. On May 20, 1991, Anderson applied for disability
benefits from the Social Security Administration, claiming he was
disabled because he was infected with HIV, the virus which causes
AIDS.  By letter dated July 18, 1991, the SSA notified Anderson
that his application for disability benefits was approved and
that he is entitled to SSI benefits beginning on May 20, 1991.

The SSA calculated the amount of SSI benefits for Anderson using
the Retrospective Monthly Accounting (RMA) method prescribed by
the Secretary in 20 C.F.R.  416.420(b).  According to that
method, income received during the first month of eligibility is
used to calculate the amount of benefits due in the first,
second, and third month of eligibility, even if such income is
nonrecurring, is not received during the second and third month
of eligibility, and even if the SSA has reliable information to
that effect.

The standard SSI benefit rate in 1991 was $407.00 per month.
Anderson received $86.52 in SSI benefits for May 1991; $223.51 in
SSI benefits for June 1991, $223.51 in SSI benefits for July
1991; and $407.00 per month in SSI benefits beginning in August
1991.  The benefits for May, June, and July, 1991, were reduced
because in May 1991, before he became disabled, Ronnie Anderson
had worked and earned $451.99. The amount of SSI benefits for May
1991 ($86.52) was the result of prorating the monthly benefits of
$223.51 for the period May 20 through May 31.

Had Ronnie Anderson applied for benefits on June 1, 1991, he
would have received no benefits for May 1991, and his SSI
benefits for June and July 1991 would have totaled $814.00 (since
he received no income during these months).  Because Anderson
applied on May 20, 1991, he received $533.54 for May, June, and
July.

Without pursuing administrative remedies, Anderson filed this
action seeking to invalidate the RMA policy of the SSA and to
compel the Secretary to recalculate the SSI benefits for the
months of May, June, and July of 1991.

The Secretary now moves this court to dismiss this action on the
ground that Ronnie Anderson must exhaust his remedies within the
SSA before seeking relief from this court.



DISCUSSION

The SSI program, which was established by Title XVI of the Social
Security Act, 42 U.S.C.  1381 et seq., and is administered by the
SSA, provides benefits to indigent aged, blind, and disabled
persons.  Bowen v. City of New York, 476 U.S. 467, 106 S.Ct.
2022, 90 L.Ed.2d 462 (1986).  Its purpose is to provide a minimum
amount of income for the aged, blind, and disabled so as to
enable those needy individuals to meet their basic needs.
Beckless v. Heckler, 622 F.Supp. 715 (N.D.Ill.1985).

Under the Social Security Act, the amount of SSI benefits is to
be calculated using the Retrospective Monthly Accounting (RMA)
method.  42 U.S.C.  1382(c) (1991).  The general RMA rule is that
the amount of SSI benefits for any month "shall be determined for
such month on the basis of income and other characteristics in
the  ...  second month preceding such month."   42 U.S.C.
1382(c)(1) (1991). This general rule governs the calculation of
the amount of SSI benefits due an individual for the third and
subsequent months after the individual qualifies for benefits.

The calculation of SSI benefits for the first and second months
of eligibility shall be determined "on the basis of the income
and other relevant circumstances" of the recipient in the first
month of eligibility.  42 U.S.C.  1382(c)(4)(A) (1991).  The
Secretary, in his regulations purporting to implement the
statutory RMA provisions, 20 C.F.R.  416.420(b), has taken the
position that the fact that income is received only during the
first month of eligibility is to be ignored since it is neither a
"characteristic" nor a "relevant circumstance." Plaintiff asserts
that the regulations are invalid because they do not take into ac
count a relevant circumstance nor a characteristic as required by
the Act  Furthermore, "if the Secretary determines that reliable
information is currently available with respect to the income and
other circumstances of an individual for a month the benefit
amount ... for such month [SOS] may be determined on the basis of
such information,"  42  U.S.C.   1382(c)(4)(A) (1991), and "[t]he
Secretary shall prescribe by regulation the circumstances in
which [reliable and currently available] information ... may be
taken into account ... in determining benefit amounts."  42
U.S.C.  1382(c)(4)(B) (1991).  The Secretary has not issued any
such regulations, having determined that "no reliable information
which is currently available and is administratively feasible to
use exists."  56 Fed. Reg. 14268 (April 8, 1991).  Plaintiff as
serts that the Secretary has failed to comply with a mandatory
duty imposed by the Act.

[1]  A claimant who is dissatisfied with the initial
determination of, for example, the amount of his benefits, is
afforded a three-stage administrative review process:

1.   a de novo reconsideration;

2.   a hearing before an Administrative Law Judge; and

3.   a review by the Appeals Council.

Proceeding through these three stages exhausts the claimant's
administrative remedies. Bowen v. City of New York, 476 U.S.
467,106 S.Ct 2022, 90 L.Ed.2d 462 (1986).



Judicial Review

Judicial review of "any final decision" of the Secretary can be
obtained in federal court. 42 U.S.C.  405(g) (1991) (made
applicable to SSI cases by 42 U.S.C.  1383(c) (1991)).

[2, 3]  The "final decision" requirement of Section 405(g), as
interpreted by the Supreme Court, consists of two elements. The
first element requires that a claim for benefits be presented to
the Secretary The presentment requirement is jurisdictional and
may not be waived.  Weinberger v. Salfi, 422 U.S. 749, 95 S.Ct.
2457, 45 L.Ed.2d 522 (1975). The second element is the
requirement that the claimant exhaust the administrative remedies
prescribed by the Secretary.  The exhaustion requirement is not
jurisdictional in nature and may be waived by the Secretary.
Weinberger v. Salfi 422 U.S. 749, 95 S.Ct 2457, 45 L.Ed.2d 522
(1975), or by the courts, Mathews v. Eldridge, 424 U.S. 319, 96
S.Ct. 893, 47 L.Ed.2d 18 (1976); Bowen v. City of New York 476
U.S. 467, 106 SCt. 2022, 90 L.Ed.2d 462 (19S6).

[4]  In order for the court to waive the exhaustion requirement,
a claimant must satisfy a three-part test:

1.   the claim at issue must be collateral to a substantive claim
of entitlement to benefits;

2.   the claimant makes a colorable showing that requiring him to
exhaust his administrative remedies would cause him an
irreparable injury which retroactive payment of benefits cannot
remedy; and

3.   the claimant can show that exhaustion of administrative
remedies would be futile.

Bowen v. City of New York, 476 U.S. 467, 106 S.Ct 2022, 9(1
L.Ed.2d 462 (1986); Marcus v. Sullivan 926 F.2d 604 (7th Cir.
1991); State of New York v. Sullivan, 906 F.2d 910 (2d Cir.1990);
Cassim v. Bowen, 824 F.2d 791(9th Cir.1987).

A.   Presentment

Plaintiff has submitted his claim for disability benefits to the
SSA and the SSA had ruled on his claim.  Submission of a claim
for the benefits to the Secretary satisfies the presentment
element of the final decision requirement.  Mathews v. Eldridge,
424 U.S. at 328, 96 S.Ct. at 899; State of New York v. Sullivan,
906 F.2d 910 (2:1 Cir.1990); Dunn v. Sullivan, 758 F.Supp. 210
(D.Delaware 1991).

B.   Waiver of Exhaustion of Administrative Remedies

[5]  Since plaintiff has met the nonwaivable jurisdictional
requirements of 42 U.S.C. 405(g) (1991), the court must consider
whether the exhaustion of administrative remedies should be
waived in this case.

1.   Plaintiff's Claim in this Action is Collateral to His
Substantive Claim of Entitlement to Benefits

Plaintiff's claim is clearly collateral to his substantive claim
of entitlement to benefits. Plaintiff's substantive claim of
entitlement to disability SSI benefits has been allowed by the
Secretary, and he receives such benefits; thus, this action has
nothing to do with plaintiffs entitlement to such benefits.  In
this lawsuit, plaintiff is primarily seeking a determination of
the proper procedures for calculating the amount of benefits due
him during the first three months of eligibility, not an award of
benefits.

Where a plaintiff asserts that a policy or regulation of the SSA
is invalid as being in conflict with the Constitution or the
Social Security Act, his claim is collateral; where a plaintiff
asserts that a policy or regulation has been incorrectly applied
to his claim for benefits, he is asserting a substantive claim of
entitlement to benefits. The fact that the challenged policy had
the effect of denying benefits does not transform a procedural
challenge into a substantive claim of entitlement.  See Dunn v.
Sullivan, 758 F.Supp. 210 (D.Delaware 1991) (citing cases); see
also State of New York v. Sullivan, 906 F.2d 910 (2:1 Cir. 1990);
Johnson v. Sullivan, 922 F.2d 346 (7th Cir.1990); Marcus v.
Sullivan, 926 F.2d 604 (7th Cir.1991); Jensen v. Schweiker, 709
F.2d 1227, 1229 (8th Cir.1983).

In the case at bar, plaintiff is not claiming that the RMA policy
as set out in the regulation had been improperly applied to his
claim for benefits.  Rather, plaintiff claims that the RMA
policy, as set out in the regulation, has been properly applied
but is invalid because it conflicts with the Social Security Act.

2.   Plaintiff Made a Colorable Showing that He Would Be
Irreparably Injured Were He Required to Exhaust His
Administrative Remedies

Plaintiff has made at least a colorable showing that he would be
irreparably injured were he required to exhaust his
administrative remedies.

The three step review process provided by the SSA is time
consuming and time is something plaintiff may not have.
Plaintiff is infected with HIV, the virus that causes AIDS; his
life expectancy is probably rather short. [footnote 1]  The need
for a speedy resolution in a case such as this is obvious if the
plaintiff, rather than his estate, is to obtain the benefit of a
favorable decision. Remitting plaintiff to his administrative
remedies may exhaust more than the administrative remedies
provided by the SSA; it may exhaust most of plaintiff's remaining
life span.

/* This section of the opinion is one of the most striking
sections in our collection of cases. */

Because of his illness, plaintiff also needs to avoid stress,
[footnote 2] and the ordeal of having to go through the
administrative appeal process may trigger a medical set-back. See
Bowen v. City of New York, 476 U.S. at 483484, 106 S.Ct. at 2031-
2032; Cf Reed v. Heckler, 756 F.2d 779 at 783 (10th Cir.1985).

Under these circumstances, the court finds that plaintiff would
be irreparably injured were he required to exhaust his
administrative remedies.

3.   Exhaustion of Administrative Remedies Would be Futile

The Secretary has promulgated regulations purportedly
implementing the RMA provisions of the Social  Security Act
Plaintiff asserts that these regulations are in violation of the
Act The administrative remedies available to plaintiff cannot be
used to invalidate these regulations.  See Weinberger v. Sulfi,
422 U.S. 749, 95 S.Ct 2457, 45 L.Ed.2d 522 (1975). Furthermore,
in April 1991, the Secretary declined to promulgate regulations
required by 42 U.S.C.  1382(c)(4)(B) (1991).  56 Fed.Reg. 14268
(1991).  The Secretary has taken a final position on the validity
of his RMA regulations and the administrative appeal process
cannot provide plaintiff with any relief.  Exhaustion of
administrative remedies would be futile where the Secretary's
position is firm, and further administrative appeal would prove
unavailing. Beckless v. Heckler, 622 F.Supp. 715 (N.D.Ill.1985).
This standard is satisfied in the case at bar.

4.   Some Courts in Similar Cases Have Not Required Plaintiffs to
Exhaust Their Administrative Remedies

This case is not the first in which the RMA regulations and
policies of the SSA are being challenged in federal courts.  In
Gould v. Sullivan, 131 F.R.D. 108 (S.D.Ohio 1989), the income
from Aid to Families with Dependent Children (AFDC) benefits was
received only during the first month of eligibility for SSI and
used to calculate benefits for the first, second, and third
months.  The plaintiffs in that case asserted that the Secretary
violated the Social Security Act, 42 U.S.C.  1382(c)(4)(B) (1991)
by failing to promulgate regulations implementing the "reliable
information" exception.  Similar to the case at bar, the
Secretary in that case moved to dismiss for failure to exhaust
administrative remedies.  The court over-ruled the motion,
finding that the plaintiff had represented their claims and that
exhaustion is not required in a case such as this where it would
be futile and would not serve any of the purposes underlying the
exhaustion requirement Thus, a court in a similar case did not
require the plaintiffs to exhaust their administrative remedies.



CONCLUSION

For the above stated reasons, the Secretary's Motion to Dismiss
is DENIED.



FOOTNOTES:

1.   Most people with AIDS die within two and a half years of
diagnosis. Paul Albert, et al., AIDS Practice Manual, a Legal and
Educational Guide (National Lawyers Guild AIDS Network, 3d ed.
1991).  Approximately 9.7% of people with AIDS survive three
years or more.  Michael Callen, Surviving AIDS (1990).

2.   Stress is a factor in numerous diseases, including AIDS,
because it affects the immune system. M. Delaney and P. Goldblum
Strategies for Survival (1987).