{ "id": 570753, "name": "ESTATE OF BRUCE C. PALMER, a Disabled Person, by Romie J. Palmer, Plenary Guardian of the Estate, et al., Plaintiffs-Appellants, v, THE DEPARTMENT OF PUBLIC AID et al., Defendants-Appellees", "name_abbreviation": "Estate of Palmer v. Department of Public Aid", "decision_date": "2001-10-19", "docket_number": "No. 1\u201400\u20143724", "first_page": "1132", "last_page": "1138", "citations": [ { "type": "official", "cite": "325 Ill. App. 3d 1132" } ], "court": { "name_abbreviation": "Ill. App. Ct.", "id": 8837, "name": "Illinois Appellate Court" }, "jurisdiction": { "id": 29, "name_long": "Illinois", "name": "Ill." }, "cites_to": [ { "cite": "20 C.F.R. \u00a7 404.2035", "category": "laws:admin_compilation", "reporter": "C.F.R.", "weight": 2, "year": 1999, "opinion_index": 0 }, { "cite": "497 N.E.2d 763", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1986, "pin_cites": [ { "page": "775-76" } ], "opinion_index": 0 }, { "cite": "113 Ill. 2d 219", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 3173826 ], "year": 1986, "pin_cites": [ { "page": "244-45" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/113/0219-01" ] }, { "cite": "571 F. Supp. 880", "category": "reporters:federal", "reporter": "F. Supp.", "case_ids": [ 3595532 ], "year": 1983, "pin_cites": [ { "page": "884", "parenthetical": "observing that \"cases in which section 407 has been held not to be applicable are [those] involving the reduction of other non-Social Security benefits *** to compensate for an individual's receipt of Social Security benefits\"" } ], "opinion_index": 0, "case_paths": [ "/f-supp/571/0880-01" ] }, { "cite": "409 U.S. 413", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6176077 ], "weight": 3, "year": 1973, "pin_cites": [ { "parenthetical": "New Jersey welfare agency could not reach disabled person's bank account containing federal disability payments" }, { "parenthetical": "New Jersey welfare agency could not reach disabled person's bank account containing federal disability payments" }, { "parenthetical": "New Jersey welfare agency could not reach disabled person's bank account containing federal disability payments" } ], "opinion_index": 0, "case_paths": [ "/us/409/0413-01" ] }, { "cite": "485 U.S. 395", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 14073 ], "weight": 9, "year": 1988, "pin_cites": [ { "page": "396" }, { "page": "457" }, { "page": "1204-05" }, { "page": "397-98" }, { "page": "458" }, { "page": "1205-06" } ], "opinion_index": 0, "case_paths": [ "/us/485/0395-01" ] }, { "cite": "610 F.2d 1228", "category": "reporters:federal", "reporter": "F.2d", "case_ids": [ 11197 ], "year": 1980, "pin_cites": [ { "page": "1243", "parenthetical": "holding that 42 U.S.C. \u00a7 407(a) \"clearly contemplates a formal legal proceeding\" and rejecting plaintiffs' assertions that social security benefits were \"protected income\" and were not to be counted in determining Medicaid eligibility" } ], "opinion_index": 0, "case_paths": [ "/f2d/610/1228-01" ] }, { "cite": "42 C.F.R. \u00a7 435.608", "category": "laws:admin_compilation", "reporter": "C.F.R.", "year": 1999, "opinion_index": 0 }, { "cite": "20 C.F.R. \u00a7 416.1121", "category": "laws:admin_compilation", "reporter": "C.F.R.", "pin_cites": [ { "page": "(a)" } ], "opinion_index": 0 }, { "cite": "651 N.E.2d 680", "category": "reporters:state_regional", "reporter": "N.E.2d", "weight": 4, "year": 1995, "pin_cites": [ { "page": "681" }, { "page": "681" }, { "page": "682" }, { "page": "683" } ], "opinion_index": 0 }, { "cite": "272 Ill. App. 3d 1017", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 252486 ], "weight": 4, "year": 1995, "pin_cites": [ { "page": "1018" }, { "page": "1019-20" }, { "page": "1020" }, { "page": "1021" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/272/1017-01" ] }, { "cite": "42 C.F.R. \u00a7\u00a7 435.733", "category": "laws:admin_compilation", "reporter": "C.F.R.", "pin_cites": [ { "page": "(a)(1)" } ], "opinion_index": 0 }, { "cite": "20 C.F.R. \u00a7 416.1104", "category": "laws:admin_compilation", "reporter": "C.F.R.", "year": 1999, "opinion_index": 0 }, { "cite": "8 F.3d 1565", "category": "reporters:federal", "reporter": "F.3d", "case_ids": [ 10517067 ], "year": 1993, "pin_cites": [ { "page": "1568-69", "parenthetical": "describing the \"interaction between Medicaid, a medical assistance program, and the SSI statute, a cash assistance program\"" } ], "opinion_index": 0, "case_paths": [ "/f3d/8/1565-01" ] }, { "cite": "42 C.F.R. \u00a7 435.121", "category": "laws:admin_compilation", "reporter": "C.F.R.", "year": 1999, "opinion_index": 0 }, { "cite": "42 U.S.C. \u00a7 1382", "category": "laws:leg_statute", "reporter": "U.S.C.", "year": 1994, "pin_cites": [ { "page": "et seq." } ], "opinion_index": 0 }, { "cite": "432 U.S. 416", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 6180199 ], "weight": 3, "year": 1977, "pin_cites": [ { "page": "425" }, { "page": "456" }, { "page": "2406" } ], "opinion_index": 0, "case_paths": [ "/us/432/0416-01" ] }, { "cite": "544 N.E.2d 751", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 1989, "pin_cites": [ { "page": "753" } ], "opinion_index": 0 }, { "cite": "129 Ill. 2d 535", "category": "reporters:state", "reporter": "Ill. 2d", "case_ids": [ 5567400 ], "year": 1989, "pin_cites": [ { "page": "540" } ], "opinion_index": 0, "case_paths": [ "/ill-2d/129/0535-01" ] }, { "cite": "453 U.S. 34", "category": "reporters:federal", "reporter": "U.S.", "case_ids": [ 11721956 ], "weight": 15, "year": 1981, "pin_cites": [ { "page": "36" }, { "page": "465" }, { "page": "2636" }, { "page": "36-37" }, { "page": "465" }, { "page": "2636" }, { "page": "43-44" }, { "page": "470" }, { "page": "2640" }, { "page": "44" }, { "page": "470" }, { "page": "2640" }, { "page": "44" }, { "page": "470" }, { "page": "2640" } ], "opinion_index": 0, "case_paths": [ "/us/453/0034-01" ] }, { "cite": "42 C.F.R. \u00a7 430.0", "category": "laws:admin_compilation", "reporter": "C.F.R.", "weight": 2, "year": 1999, "opinion_index": 0 }, { "cite": "740 N.E.2d 21", "category": "reporters:state_regional", "reporter": "N.E.2d", "year": 2000, "pin_cites": [ { "page": "26" } ], "opinion_index": 0 }, { "cite": "317 Ill. App. 3d 863", "category": "reporters:state", "reporter": "Ill. App. 3d", "case_ids": [ 1025915 ], "year": 2000, "pin_cites": [ { "page": "868" } ], "opinion_index": 0, "case_paths": [ "/ill-app-3d/317/0863-01" ] }, { "cite": "42 U.S.C. \u00a7 407", "category": "laws:leg_statute", "reporter": "U.S.C.", "weight": 6, "year": 1994, "pin_cites": [ { "page": "(a)" }, { "page": "(a)" }, { "page": "(a)" }, { "page": "(a)" }, { "page": "(a)" } ], "opinion_index": 0 }, { "cite": "42 U.S.C. \u00a7 402", "category": "laws:leg_statute", "reporter": "U.S.C.", "year": 1994, "pin_cites": [ { "page": "et seq." } ], "opinion_index": 0 } ], "analysis": { "cardinality": 749, "char_count": 14768, "ocr_confidence": 0.784, "pagerank": { "raw": 4.03580807328026e-08, "percentile": 0.02034809751456552 }, "sha256": "d4248ebd45e87ab2067cce352f6d9e7ebc95f491068b96738dc107ecfe5a1ad0", "simhash": "1:03ee9c06779a865e", "word_count": 2381 }, "last_updated": "2023-07-14T19:13:10.268443+00:00", "provenance": { "date_added": "2019-08-29", "source": "Harvard", "batch": "2018" }, "casebody": { "judges": [], "parties": [ "ESTATE OF BRUCE C. PALMER, a Disabled Person, by Romie J. Palmer, Plenary Guardian of the Estate, et al., Plaintiffs-Appellants, v, THE DEPARTMENT OF PUBLIC AID et al., Defendants-Appellees." ], "opinions": [ { "text": "JUSTICE GALLAGHER\ndelivered the opinion of the court:\nPlaintiffs Bruce C. Palmer (Palmer), a disabled adult living at Oak Forest Hospital, and his guardian, Romie J. Palmer, appeal from the trial court\u2019s order that the Illinois Department of Public Aid (the Department) properly considered Old Age Survivor and Disability Insurance (OASDI) and veterans\u2019 benefits received by Palmer as available income for the purpose of calculating the amount of Palmer\u2019s Medicaid benefits. However, the trial court also held that the Department could not attach money in Palmer\u2019s estate as reimbursement for past-due amounts owed to Oak Forest Hospital or consider the sum of that estate in calculating Palmer\u2019s future Medicaid benefits. Plaintiffs appeal the trial court\u2019s rulings, and we affirm.\nThe record on appeal establishes the following facts. Palmer is a severely mentally and physically disabled adult who is 52 years old and is unable to communicate or care for himself. Since 1978, Palmer has received public assistance from the Department under its Aid to Aged, Blind, or Disabled program, which is part of the Public Aid Code (305 ILCS 5/3 \u2014 1 et seq. (West 1998)). Palmer receives OASDI benefits pursuant to the Social Security Act (the Act) (42 U.S.C. \u00a7 402 et seq. (1994)) and also receives veterans\u2019 benefits due to his mother\u2019s military service.\nThe Department provides Medicaid benefits to Palmer based upon the amount of money that is otherwise available to pay for Palmer\u2019s care. At some point, the Department included Palmer\u2019s OASDI and veterans\u2019 benefits as available income in determining the amount of Palmer\u2019s Medicaid benefits. The Department reduced the amount of payments made to Oak Forest Hospital in Palmer\u2019s name based on that calculation of Palmer\u2019s available income. The Department also determined that $7,844 of Palmer\u2019s benefits, which were kept in an account supervised by Romie Palmer and which had funded Palmer\u2019s expenses at the hospital, were to be turned over to the Department as reimbursement for past state support. In January 1998, hospital records indicated that Palmer owed the hospital $14,326.68.\nPlaintiffs filed a complaint for declaratory and injunctive relief, which the trial court dismissed on jurisdictional grounds pursuant to section 2 \u2014 619 of the Illinois Code of Civil Procedure (735 ILCS 5/2\u2014 619 (West 1996)). The trial court also determined that the Department\u2019s actions did not violate federal law. On appeal, this court refused to address the merits of plaintiffs\u2019 claims because the trial court had dismissed the case based upon lack of jurisdiction. This court reversed the trial court\u2019s ruling and remanded the case for further proceedings. Estate of Palmer v. Department of Public Aid, No. 1\u201499\u20140979 (December 30, 1999) (unpublished order pursuant to Supreme Court Rule 23). On remand, the parties filed cross-motions for summary judgment. In a written order, the trial court granted the Department\u2019s motion, finding that it properly included Palmer\u2019s OASDI and veterans\u2019 benefits in calculating Palmer\u2019s available income. However, the trial court also held that the Department could not seek reimbursement from those funds for amounts that were previously due to the hospital.\nPlaintiffs now appeal that order, arguing that federal law prohibits \u201cthe attachment, assignment or compelled taking\u201d of Social Security or veterans\u2019 benefits. Citing 42 U.S.C. \u00a7 407(a) (1994), which provides that the \u201cright of any person to any future payment under this subchapter\u201d is not \u201csubject to execution, levy, attachment, garnishment, or other legal process,\u201d plaintiffs contend that such benefits are protected from all creditors, including the State in an administrative proceeding. Plaintiffs assert that the Department\u2019s reduction of Palmer\u2019s Medicaid benefits based on the amount of his available income, which the Department found to include his OASDI and veterans\u2019 benefits, constituted a \u201ctaking\u201d by administrative decision. Our review of the trial court\u2019s grant of summary judgment is de novo. La Grange Memorial Hospital v. St. Paul Insurance Co., 317 Ill. App. 3d 863, 868, 740 N.E.2d 21, 26 (2000).\nEstablished in 1965 as part of the Act, the Medicaid program authorizes federal financial grants to states for people in need of certain costs of medical treatment. 42 C.F.R. \u00a7 430.0 (1999); see also Schweiker v. Gray Panthers, 453 U.S. 34, 36, 69 L. Ed. 2d 460, 465, 101 S. Ct. 2633, 2636 (1981). The Medicaid program is jointly financed by the federal and state governments and is administered by the states. 42 C.F.R. \u00a7 430.0 (1999). Each state develops a plan for determining eligibility for medical assistance, and a state\u2019s program must comply with the Act and with requirements of the Secretary of the United States Department of Health and Human Services (the Secretary). 42 U.S.C. \u00a7 1396a(a)(17)(B) (1994); Gray Panthers, 453 U.S. at 36-37, 69 L. Ed. 2d at 465, 101 S. Ct. at 2636. See also Hession v. Illinois Department of Public Aid, 129 Ill. 2d 535, 540, 544 N.E.2d 751, 753 (1989). The agency responsible for administering the program in this state has been the Illinois Department of Public Aid, whose powers are now held by the Illinois Department of Human Services. 20 ILCS 1305/ 80 \u2014 15 (West 2000).\nThe Supreme Court noted in Gray Panthers that under 42 U.S.C. \u00a7 1396a(a)(17)(B), when granting Medicaid benefits, a state must take into account \u201conly such income and resources as are, as determined in accordance with standards prescribed by the Secretary, available to the applicant.\u201d (Emphasis omitted.) Gray Panthers, 453 U.S. at 43-44, 69 L. Ed. 2d at 470, 101 S. Ct. at 2640. The Court went on to state that the Secretary\u2019s definition of the term \u201cavailable\u201d was entitled to \u201clegislative effect\u201d because the Secretary is entrusted by Congress with \u201cthe primary responsibility for interpreting the statutory term.\u201d Gray Panthers, 453 U.S. at 44, 69 L. Ed. 2d at 470, 101 S. Ct. at 2640, citing Batterton v. Francis, 432 U.S. 416, 425, 53 L. Ed. 2d 448, 456, 97 S. Ct. 2399, 2406 (1977). Accordingly, the Court stated that its review was limited to ensuring that the Secretary\u2019s regulations are not arbitrary or capricious. Gray Panthers, 453 U.S. at 44, 69 L. Ed. 2d at 470, 101 S. Ct. at 2640.\nThe instant case centers upon the Secretary\u2019s definition of \u201cavailable income.\u201d Under the complex provisions of the Medicaid statute, the requirements for Medicaid eligibility utilize the definitions of \u201cincome\u201d in the Supplemental Security Income (SSI) program (42 U.S.C. \u00a7 1382 et seq. (1994)). 42 C.F.R. \u00a7 435.121 (1999); see also State of Georgia Department of Medical Assistance v. Shalala, 8 F.3d 1565, 1568-69 (11th Cir. 1993) (describing the \u201cinteraction between Medicaid, a medical assistance program, and the SSI statute, a cash assistance program\u201d).\nThe SSI regulations define two types of income: earned and unearned. 20 C.F.R. \u00a7 416.1104 (1999). The larger an individual\u2019s income, whether earned or unearned, the smaller the Medicaid payment that will be made to an institution on the individual\u2019s behalf. Pursuant to 20\u2019 C.F.R. \u00a7 416.1121(a) (1999), Social Security benefits and veterans\u2019 benefits are listed under \u201c[t]ypes of unearned income\u201d; that section also lists private pensions, disability benefits, worker\u2019s compensation and unemployment insurance benefits as unearned income. Pursuant to the Medicaid regulations, an agency must reduce its payment to an institution for services based upon the recipient\u2019s income, with the exception of a monthly \u201cpersonal needs\u201d allowance of at least $30. 42 C.F.R. \u00a7\u00a7 435.733(a)(1), (c)(1) (1999).\nPlaintiffs contend that the Department\u2019s reduction of Palmer\u2019s Medicaid reimbursement based upon his OASDI and veterans\u2019 benefits constitutes an improper \u201cinvoluntary taking.\u201d They cite In re Estate of Merritt, 272 Ill. App. 3d 1017, 1018, 651 N.E.2d 680, 681 (1995), in which the Illinois Department of Mental Health and Developmental Disabilities brought an action against a disabled adult\u2019s estate for reimbursement for his stay at one of that department\u2019s hospitals. The trial court ordered the estate to pay the department the amount it was owed. Estate of Merritt, 272 Ill. App. 3d at 1019-20, 651 N.E.2d at 681. This court reversed, finding that 42 U.S.C. \u00a7 407(a) prevented the trial court from ordering the estate to reimburse the department with funds that were derived from the disabled person\u2019s Social Security benefits. Estate of Merritt, 272 Ill. App. 3d at 1020, 651 N.E.2d at 682.\nIn the instant case, plaintiffs assert that the Department\u2019s reduction in benefits payments \u201ccannot be considered anything but a legal process designed to obtain [Palmer\u2019s Social Security and veterans\u2019] benefits.\u201d We disagree, as we find a clear distinction between a reduction in the amount of a person\u2019s benefits based upon his or her income and a suit to obtain those benefits. As required by the above regulations, Palmer\u2019s Medicaid payment is reduced by the total amount of his income, and 20 C.F.R. \u00a7 416.1121(a) provides that Palmer\u2019s income includes his OASDI and veterans\u2019 benefits. The reduction in Medicaid that reflects Palmer\u2019s income does not amount to a taking of any benefits; instead, Palmer\u2019s income determines the size of the Medicaid payment to which he is entitled. As stated in 42 C.F.R. \u00a7 435.608 (1999), to be eligible for Medicaid benefits, Palmer is required to take all necessary steps to obtain pensions and retirement and disability benefits to which he is entitled, specifically including veterans\u2019 compensation and pensions and OASDI benefits. As the trial court stated in its order, \u201c[t]he intent of Medicaid is to help those individuals who need additional help, but if an individual can apply for, and receive benefits from another source, logic dictates that the Medicaid payments by the [flederal and [sjtate governments should decrease.\u201d\nA reduction in Medicaid payments based upon the other sources of income that are available to Palmer is not the same as an action brought to recover portions of that income. See Norman v. St. Clair, 610 F.2d 1228, 1243 (5th Cir. 1980) (holding that 42 U.S.C. \u00a7 407(a) \u201cclearly contemplates a formal legal proceeding\u201d and rejecting plaintiffs\u2019 assertions that social security benefits were \u201cprotected income\u201d and were not to be counted in determining Medicaid eligibility). The Department\u2019s calculation of Medicaid benefits in the present case is clearly distinguishable from the government\u2019s suit in Merritt and also from the circumstances of Bennett v. Arkansas, 485 U.S. 395, 99 L. Ed. 2d 455, 108 S. Ct. 1204 (1988), in which the State of Arkansas attempted to attach federal Social Security benefits being paid to prison inmates. Bennett, 485 U.S. at 396, 99 L. Ed. 2d at 457, 108 S. Ct. at 1204-05. In a per curiam opinion, the Supreme Court found an inconsistency between the Arkansas statute allowing attachment of the inmates\u2019 federal benefits and 42 U.S.C. \u00a7 407(a), which \u201cunambiguously rules out any attempt to attach Social Security benefits,\u201d noting its similar finding in Philpott v. Essex County Welfare Board, 409 U.S. 413, 34 L. Ed. 2d 608, 93 S. Ct. 590 (1973) (New Jersey welfare agency could not reach disabled person\u2019s bank account containing federal disability payments). Bennett, 485 U.S. at 397-98, 99 L. Ed. 2d at 458, 108 S. Ct. at 1205-06. See also McDaniels v. Heckler, 571 F. Supp. 880, 884 (D.C. Md. 1983) (observing that \u201ccases in which section 407 has been held not to be applicable are [those] involving the reduction of other non-Social Security benefits *** to compensate for an individual\u2019s receipt of Social Security benefits\u201d); Raskin v. Moran, 684 E2d 472, 476 n.7 (7th Cir. 1982) (noting that the Supreme Court in Philpott limited its holding to \u201cdirect attachment or garnishment by a state\u201d); Bernier v. Burris, 113 Ill. 2d 219, 244-45, 497 N.E.2d 763, 775-76 (1986) (citing Raskin and finding that 42 U.S.C. \u00a7 407 is not violated by Illinois statute that a judgment in a negligence action against hospitals and physicians can be reduced by up to one-half by benefits that the plaintiff has received from collateral sources, such as private or governmental disability programs). In light of that precedent, we affirm the trial court\u2019s holdings that the Department could consider Palmer\u2019s OASDI and veterans\u2019 benefits in calculating the amount of his Medicaid payment and that such action did not constitute a taking of Palmer\u2019s benefits.\nIn addition, we reject plaintiffs\u2019 assertion that Romie Palmer has unimpeded discretion to spend Palmer\u2019s benefit funds. Citing 20 C.F.R. \u00a7 404.2035 (1999), plaintiffs argue that Romie Palmer is a \u201crepresentative payee\u201d and may use the funds received for Palmer\u2019s care \u201cin a manner and for the purposes he or she determines *** to be in the best interest of the beneficiary.\u201d Plaintiffs rely on the court\u2019s conclusion in Estate of Merritt, 272 Ill. App. 3d at 1021, 651 N.E.2d at 683, that a representative payee is not required to reimburse the State for the cost of a disabled person\u2019s care with funds received from the disabled\u2019s Social Security benefits. They contend that the trial court incorrectly ruled that Palmer\u2019s OASDI benefits \u201chad to be used to pay for his care at Oak Forest Hospital.\u201d\nHowever, in finding that the amounts of Palmer\u2019s OASDI and veterans\u2019 benefits could be considered in determining his Medicaid benefit payment, the trial court did not make a determination as to how Palmer\u2019s OASDI or veterans\u2019 benefits were to be spent. The court found that 42 U.S.C. \u00a7 407(a) prohibited the attachment of funds that were already part of Palmer\u2019s estate, which is supported by the Supreme Court\u2019s decision in Philpott and by numerous lower court decisions cited previously. The court correctly concluded that the Department could not attach Palmer\u2019s benefits but could consider those sums in calculating the amount of his Medicaid payment. Moreover, plaintiffs admit in their reply brief that the \u201crepresentative payee\u201d provision of 20 C.F.R. \u00a7 404.2035 is not part of the Medicaid regulations.\nFor the foregoing reasons, the judgment of the trial court is affirmed.\nAffirmed.\nBUCKLEY and O\u2019BRIEN, JJ., concur.", "type": "majority", "author": "JUSTICE GALLAGHER" } ], "attorneys": [ "Collins & Bargione, of Chicago (George B. Collins and Gregory A. Bedell, of counsel), for appellants.", "James E. Ryan, Attorney General, of Chicago (Joel D. Bertocchi, Solicitor General, and James C. O\u2019Connell and Christopher S. Gange, Assistant Attorneys General, of counsel), for appellees." ], "corrections": "", "head_matter": "ESTATE OF BRUCE C. PALMER, a Disabled Person, by Romie J. Palmer, Plenary Guardian of the Estate, et al., Plaintiffs-Appellants, v, THE DEPARTMENT OF PUBLIC AID et al., Defendants-Appellees.\nFirst District (6th Division)\nNo. 1\u201400\u20143724\nOpinion filed October 19, 2001.\nCollins & Bargione, of Chicago (George B. Collins and Gregory A. Bedell, of counsel), for appellants.\nJames E. Ryan, Attorney General, of Chicago (Joel D. Bertocchi, Solicitor General, and James C. O\u2019Connell and Christopher S. Gange, Assistant Attorneys General, of counsel), for appellees." }, "file_name": "1132-01", "first_page_order": 1150, "last_page_order": 1156 }