IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF OHIO

EASTERN DIVISION

Catherine Harper-Lee, :

et al.,

 Plaintiffs, :

 v. : Case No. 2:11-cv-571

Michael J. Astrue, : JUDGE GEORGE C. SMITH

Commissioner of Social Security, Magistrate Judge Kemp

Defendant. : 

 OPINION AND ORDER

Plaintiffs Miah and Calista Harper applied for survivors’ 

benefits following the death of their stepfather. After an

administrative hearing before an administrative law judge, the

Commissioner of Social Security denied those applications. This

action seeks review of that decision under 42 U.S.C. § 405(g). 

On April 12, 2012, the United States Magistrate Judge recommended

that the decision of the Commissioner be affirmed and that this

action be dismissed. Report and Recommendation, Doc. No. 17. 

This matter is now before the Court on plaintiffs’ objections to

that recommendation. Objection, Doc. No. 18. The Commissioner

has filed a response. Response, Doc. No. 20. Having considered

the matter de novo, see 28 U.S.C. §636(b); Fed. R. Civ. P. 72(b),

the Court declines to adopt the recommendation of the Magistrate

Judge, and sustains plaintiff’s statement of errors to the extent

that the case will be remanded to the Commissioner for further

proceedings. 

I.

The parties do not disagree on the basic principles of law

which govern the payment of survivors’ benefits, but only on how

those principles apply to this case. The Report and

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Recommendation summarized the applicable law as follows:

The statutory authority for the payment of

benefits to the surviving children of an insured wageearner is found in 42 U.S.C. §402(d). That statute

provides that every child of a deceased wage earner,

provided that the child is not married and is either

under 18, or, if a full-time elementary or secondary

school student, under 19, may obtain benefits if the

child was dependent on the wage-earner. This statutory

subsection also allows a step-child to obtain benefits

if, at the time the step-parent dies, the step-child

was receiving at least one-half of his or her support

from the step-parent. 42 U.S.C. §402(d)(4).

Harper-Lee v. Astrue, 2012 WL 1229941, *1 (S.D. Ohio April

12, 2012). The key issue in this case is whether, at the

time of their stepfather’s death, Miah and Calista were

receiving at least one-half of their support from him. The

ALJ thought not, and that is the decision which plaintiffs

challenge here.

II.

The parties also do not dispute the relevant facts. 

Mr. Lee, the plaintiffs’ stepfather, died in 2006. At the

time of his death, he and Ms. Harper-Lee, the plaintiffs’

mother, were separated. Tax documents show that Mr. Lee

earned about $90,000 in gross wages in 2005 and that Ms.

Harper-Lee earned almost $55,000. Mr. Lee contributed money

for the children’s support which, according to a chart of

checks written from him to Ms. Harper-Lee, amounted to

roughly $1,940.58 per month, which is $23,286.96 per year. 

He also carried insurance on both girls, and there was

testimony that he paid some other expenses on their behalf

which were not reflected in a check register or other

document. Those expenses came to about $4,200.00 annually. 

Viewing this evidence in the light most favorable to the

plaintiffs (which the ALJ did not do, and which will be

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discussed more fully below), Mr. Lee could have been

contributing as much as $27,486.96 annually for their

support, or about $13,743.48 per child per year

Without getting into great detail here about the ALJ’s

method of calculating support, the ALJ determined that Ms.

Harper-Lee’s annual net income was about $42,400. The ALJ

then reasoned that each member of Ms. Harper-Lee’s family -

herself, Miah and Calista - had one-third of that amount

available to them for support. One-third of $42,400 is about

$14,131.66, and that is the figure which the ALJ used as the

support the girls received from their mother. Because that

number was greater than the support which they received from

their stepfather (which the ALJ determined to be $10,493.50),

his contributions did not represent at least one-half of

their support. Because that is the statutory requirement for

receiving survivors’ benefits from a step-parent, the ALJ

denied their claims.

The Magistrate Judge did not necessarily agree with the

way in which the ALJ determined Mr. Lee’s share of the

children’s support. However, even under the most generous

construction of the evidence, his contributions to their

support did not equal or exceed $14,131.66. The Report and

Recommendation found that the ALJ’s decision to allocate onethird of Ms. Harper-Lee’s net income to each of the children

was consistent with the applicable statutory and regulatory

law, and recommended affirming that decision. The issue on

which plaintiffs and the Commissioner differ is whether the

method used to calculate Ms. Harper-Lee’s contributions to

her children’s support - simply dividing the household net

income by the number of household members - is allowable, or

whether a different method must be used. To answer that

question, this Court, as did the Magistrate Judge, must

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explore in some depth the applicable regulations and

interpretive guides in order to determine if the ALJ used an

appropriate method for determining the amount of Ms. HarperLee’s contributions to her daughters’ support.

III.

Plaintiffs’ argument can be summed up in this sentence,

found in their objections at page 2: “The idea that the

‘available income of the children’ can be determined by

dividing the mother’s income equally among the members of the

household is unsupported by any regulation or instruction of

the Commissioner.” According to plaintiffs, that figure can

be derived only through a fact-intensive inquiry into how

much money the mother actually spent on expenses attributable

to each child, such as the cost of their housing, food, and

other necessities such as clothing, utilities, and cash for

spending. That calculation was never made in this case, so

if plaintiffs are correct, the case would have to be remanded

for further proceedings.

Both parties appear to recognize that because the word

“support” is not defined in 42 U.S.C. §402(d)(4), the statute

provides little guidance to the Commissioner on this issue. 

The applicable regulation, 20 C.F.R. §404.366(b), says this:

(b) One-half support. The insured person provides

one-half of your support if he or she makes regular

contributions for your ordinary living costs; the

amount of these contributions equals or exceeds

one-half of your ordinary living costs; and any income

(from sources other than the insured person) you have

available for support purposes is one-half or less of

your ordinary living costs. We will consider any income

which is available to you for your support whether or

not that income is actually used for your ordinary

living costs. Ordinary living costs are the costs for

your food, shelter, routine medical care, and similar

necessities.

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This language, although more helpful, still does not tell the

Commissioner exactly how to go about deciding how to calculate

income which is “available for support purposes.” It does make

clear that the word “available” is an important one, because the

Commissioner is not just to determine how much is actually spent

on the claimants’ ordinary living costs, but how much other

income they have “available” to them “whether or not that income

is actually used for [their] ordinary living costs.” So, in a

one-parent, two-child household, where neither of the children

have any separate source of income, how much of the single

parent’s income is legally “available” for each child? That is

the gist of the dispositive question.

Plaintiffs rely on recent revisions to the POMS (the Social

Security Administration's Program Operations Manual System) in

support of their position. According to them, an example found

in POMS RS 01301.190(D)(2)(a) explains how it should be done in a

case like this one where the deceased wage-earner and his spouse

did not share or “pool” their income (and that is the case here). 

There, the father and stepmother of the claimant actually lived

in the same household but used their money for different

purposes. The stepmother, who was the deceased wage-earner,

earned $20,000 annually, the father earned $18,000 annually, and

the child had $2,000 in other income from his biological mother. 

In that case, the stepmother’s contribution was calculated by

determining how much the child’s room and board cost because she

had paid those portions of the household expenses (it came to

$2,400). All of the child’s other expenses were paid by his

father, and they totaled $2,000. However, because the child also

received $2,000 from his biological mother (even though he may

not have used that money for necessities), his “available” income

was $6,400. Since his stepmother’s contribution was not at least

one-half of that amount, he was not entitled to survivor’s

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benefits. Following that example, since Mr. Lee and Ms. HarperLee did not pool their income, plaintiffs contend that the ALJ

was required to calculate how much money Ms. Harper-Lee actually

spent on the children’s needs, and to compare that figure to the

contributions from Mr. Lee, just as the example in POMS RS

01301.190(D)(2)(a) illustrates. It is worthwhile to note that in

the example just given, even though the natural parent (there,

the father) had annual income of $18,000, the only part of that

income which was considered to be “available” to his son was the

amount he actually contributed to the son’s other expenses “such

as clothing and medical expenses.” There were a total of five

people in the household, but the example did not divide the

father’s income (or the total household income) by five in order

to calculate the child’s available income. 

The Commissioner does not dispute that the ALJ in this case

used a method for determining available income which differs from

that set forth in the example in POMS RS 01301.190(D)(2)(a). 

However, the Commissioner argues that the example does not

provide the exclusive method for determining available income,

even if it is difficult to distinguish the two situations. 

Further, the Commissioner points out that elsewhere in the same

revised POMS section, at Section (D)(1), the ALJ is told this:

If the pooled fund method does not apply, or if using

the method results in the stepchild failing to meet

one-half support by a narrow margin, compute the

stepchild's support as shown below. The examples below

illustrate the principles used in computing one-half

support in cases where the family does not pool income.

You may also refer to the example on NH [number holder]

living in parent’s home in RS 01301.195B.3.

 1. Compute the child's income from sources other

than the NH.

 2. Compute the NH's net contribution to the

stepchild (the amount he or she actually contributed to

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the stepchild).

 3. Add the figures from steps “a” and “b” to

determine the cost of the stepchild's support. One-half

of this amount equals one-half of the child's support.

 4. If the stepchild's income from sources other than

the NH exceeds one-half the cost of the stepchild's

support, the one-half support requirement is not met.

If the NH's contributions to the stepchild equal or

exceed one-half the cost of the child's support, the

requirement is met.

The first step does contemplate calculating the child’s income

(not necessarily defined by living expenses) from “sources other

than the [deceased wage-earner].” That is consistent with the

regulation’s focus on “available income” as opposed simply to

living expenses. However, before that first step is articulated,

the introductory language states that the examples given -

including the one cited by plaintiffs - “illustrate the

principles used in computing one-half support” in cases just like

this one. The only relevant principle that can be inferred from

example (D)(2)(a) is that the child’s available income from a

parent who lives in the same household is equal to the amount

that parent actually spends on the child’s living expenses and

not to a set percentage of the household income. 

The second example (Section (D)(2)(b)) is actually similar;

there, the hypothetical claimant is also a stepchild who claimed

benefits based on the earnings of her stepmother, who had died. 

Although her father and stepmother lived together and pooled

their income, the stepchild received additional money ($4,000)

from child support, so the “pooled income” method could not be

used. Again, the example presupposes that the ALJ (or someone in

the administrative process) first determined the claimant’s

actual living expenses (room and board, clothing, and medical

expenses). Those expenses came to $9,000. After the child’s own

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income (the child support payment of $4,000) was applied to those

expenses, each parent’s contribution to the remaining expenses

was computed based on his or her respective percentage of the

overall household income. In that case, the father’s income was

44% of the total family income and the stepmother’s was 56%. The

father’s contribution to the child’s living expenses was

therefore deemed to be 44% of $5,000, or $2,200, and the deceased

stepmother’s was 56% of that figure, or $2,800. The child

support of $4,000 and the “available income” from the father

(both of which were sources other than the deceased step-parent)

totaled $6,200, which exceeded the $2,800 paid by the stepmother,

so the child did not qualify. Again, the child’s “available

income” from her father was not determined by dividing his income

by the number of household members (there were five) - that would

have produced a figure of $4,800 - but by equating her available

income from that source to the living expenses he paid for her, a

much lower figure. The third example given uses the same method,

again involving a determination of the child’s living expenses

and how much each parent (both of whom had income) contributed to

those expenses.

Plaintiff is correct that there is no suggestion in any of

these three examples that the “available income” analysis could

legitimately have been reduced to a determination that the

child’s “available income” is simply that child’s proportionate

share (measured by the number of people living in the household)

of the surviving or non-disabled parent’s income, determined

completely without regard to how much that parent actually

contributed (or made available) to the child for support. Thus,

if there is a more comprehensive set of rules to be derived from

these examples, which are supposed to “illustrate the principles

used” in cases like this, it is that (1) any income received by

the child from a source other than the child’s custodial parent

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or step-parent is “available income” no matter how it is spent;

and (2) the income which is “available” from a custodial parent

is how much that parent actually spends on the child’s living

expenses. And this makes some sense; the parent is the one with

control over the money he or she earns, and if the parent decides

to spend most of it on expenses unrelated to the child, it is

hard to say, as a matter of ordinary English usage, that such

money is still somehow “available” to that child for support

purposes. The examples also illustrate the method to be used in

these cases, which, in each case, involved determining the amount

of the child’s living expenses - a step that the ALJ in this case

skipped altogether. 

To some extent, deciding that the examples found in the POMS

comport with common sense and the ordinary meaning of words does

not completely determine the issue. The POMS (at least the online version) comes with a clear disclaimer:

The POMS states only internal SSA guidance. It is not

intended to, does not, and may not be relied upon to

create any rights enforceable at law by any party in a

civil or criminal action. Further, by posting the POMS,

SSA is not thereby limited from exercising its

otherwise lawful prerogatives. If the content of the

POMS conflicts with the Social Security Act, another

relevant statute, SSA regulations, or Social Security

Rulings, those authorities have priority over the POMS. 

The last sentence is clearly true; in order of priority, the

statute, regulations adopted under that statute, and Social

Security Rulings all take precedence over the POMS. So the Court

must go back to those sources to see if any of them conflict with

the POMS or if they should be construed to allow the Commissioner

to proceed as was done in this case, notwithstanding the fact

that the POMS would seem to require a different approach.

The language of the statute (42 U.S.C. §402(d)(4)) and the

implementing regulation (20 C.F.R. §404.366(b)) are both quoted

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or described above. Neither conflicts with the principles which

are illustrated in POMS RS 01301.190. In fact, the regulation,

which describes a three-step procedure for determining whether

the one-half support requirement has been met, appears to

contemplate that the Commissioner will determine the claimant’s

ordinary living costs. The first step is determining the amount

of the wage earner’s contributions to the child; the second is to

determine if “the amount of these contributions equals or exceeds

one-half of your ordinary living costs,” something which, as

plaintiff has stressed, cannot be done if the total amount of

ordinary living costs is never calculated. The Commissioner has

not pointed to any Social Security Ruling which addresses this

issue. Consequently, the POMS section upon which plaintiffs rely

is not in conflict with any other, more authoritative, source.

The Court recognizes that the POMS, which is not subject to

the formal rule-making procedure found in the Administrative

Procedure Act, does not have the force of law. See Davis v.

Sec’y of Health and Human Services, 867 F.2d 336, 340 (6th Cir.

1989)(“the POMS is a policy and procedure manual that employees

of the Department of Health & Human Services use in evaluating

Social Security claims and does not have the force and effect of

law”). Nevertheless, a court can find them “persuasive” (as the

Davis court did), and other courts have observed that because

“these guidelines [POMS] represent the Commissioner's

interpretation of the statutory mandate, they deserve substantial

deference, and will not be disturbed as long as they are

reasonable and consistent with the statute.” Bubnis v. Apfel,

150 F.3d 177, 181 (2d Cir. 1998). The Commissioner’s position in

this case does not accord any deference to the POMS sections at

issue, nor does it rely on any other section of the POMS (or, for

that matter, any other authority at all) to support what the ALJ

did here. 

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The Court here, like the Court of Appeals did in Davis,

finds the POMS to be persuasive authority. The Commissioner is

under a statutory mandate to determine if a child who claims

survivor’s benefits was dependent on his or her stepparent. 

Section 402(d)(4) states that “[a] child shall be deemed

dependent upon his stepfather or stepmother ... if ... the child

was receiving at least one-half of his support from such

stepfather or stepmother.” The Commissioner is further under a

regulatory mandate to (1) determine the amount that the

stepparent was contributing to the child’s ordinary living

expenses, (2) determine if that amount exceeded one-half of those

expenses, and (3) determine how much other income the child had

which was “available for support.” 20 C.F.R. §404.366(b). It

makes sense that income paid to the child, or the child’s

custodial parent, for child support is income that is “available

for support,” because that is the sole legitimate purpose to

which such payments can be devoted. On the other hand, it is not

intuitively obvious that money earned by the custodial parent -

100% of which the custodial parent has discretionary control

over, subject only to the legal requirement that the parent

provide for the child’s necessities - is “available for support”

in direct proportion to how many people live in the home. 

To use the facts in this case as an illustration, Ms.

Harper-Lee may actually have been using more than one-third of

her net income to pay for each child’s ordinary living expenses,

or she may have been using less because she chose to spend her

salary on other things. Suppose, for example, that one of her

two children had some condition which required more money to be

spent on her than on her sister, and which resulted in much less

than one-third of her mother’s net income being spent on the

other child’s living expenses. In that case, it is conceivable

that one of the two claimants might meet the statutory definition

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of dependence on her step-father while the other may not have. 

None of this can be known, however, unless the ALJ engages in the

procedure suggested in 20 C.F.R. §404.366(b) and fleshed out in

POMS RS 01301.190. The Court is therefore persuaded that the

method illustrated in the POMS is a correct interpretation of the

governing statute and regulation and that the ALJ’s contrary

method is not. That conclusion requires a remand. 

IV.

The Report and Recommendation was not confined to a single

issue, however. There are two other salient points which must

also be addressed on remand.

First, as the Report and Recommendation noted,

Plaintiffs take issue with the ALJ’s refusal to credit

Mr. Lee with any contributions toward the children’s

support beyond those documented by a check, wire

transfer record, or some similar type of proof. They

cite to the applicable regulation, 20 C.F.R.

§404.736(c)(2), which provides that, for a stepchild,

the Social Security Administration, will ask for 

evidence in the form of “[a] signed statement by

someone in a position to know showing you received at

least one-half of your support from the insured for the

one-year period ending at one of the times mentioned in

paragraph (a) of this section; and the income and

support you had in this period from any other source,”

and contend that because Ms. Harper-Lee was “someone in

a position to know” about the amounts contributed by

Mr. Lee, her statements about those amounts should have

been credited by the ALJ even if she could not provide

documentary proof for all of the amounts paid.

Report and Recommendation, at 14. It was not clear from the

record if the ALJ believed that objective documentation of Mr.

Lee’s contributions was needed, but based on the fact that the

lack of objective documentation was noted by the ALJ and the fact

that the ALJ did not make an express credibility determination

concerning Ms. Harper-Lee’s testimony about other support

provided by Mr. Lee, it appeared that the ALJ took too

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restrictive an approach to determining if Mr. Lee actually made

these additional contributions to the children’s ordinary living

expenses. The Report and Recommendation did not suggest a remand

on this issue, however, because, in the Magistrate Judge’s view,

it was harmless; that is, even if Mr. Lee were credited with

these additional contributions, they would not have exceeded the

income available to the children from their mother’s earnings. 

Now that the amount of that income must be recalculated, the ALJ

should consider whether there is credible evidence of these

additional contributions, using the same standard under which the

credibility of witnesses in the administrative process is

ordinarily judged, and must make an express and well-supported

credibility finding if the testimony on this point is deemed not

fully credible.

Second, as the Report and Recommendation points out, “[t]he

ALJ recognized that Mr. Lee carried insurance on the children,

but did not credit him with any contribution in that regard

because the amount he paid for such insurance would have been the

same whether these two children were covered or not.” Report and

Recommendation, at 16. The Magistrate Judge found that this was

also error because “[i]t is not reasonable to assume that they

[the claimants] received this benefit at no cost” because “that

line of reasoning would not allow any of the family beneficiaries

to claim a contribution for the cost of this insurance, because

the cost could always be shifted to a different beneficiary

depending on which one made the claim.” The Report and

Recommendation concluded that “[a]llocation of the additional

cost paid by Mr. Lee, rather than complete disregard of this

expense, seems the only fair way to deal with this type of item,”

id. at 17, and the Court agrees. Again, this error, which was

harmless in the context of the Report and Recommendation’s

analysis of the key legal issue, may or may not be harmless

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depending upon the details of the ALJ’s recalculation of the

amount which Ms. Harper-Lee contributed to the children’s

ordinary living expenses, so this error should also be corrected

on remand.

 

V.

For all of these reasons, the plaintiffs’ objections (Doc.

18) to the Report and Recommendation (Doc. 17) are SUSTAINED. 

The Report and Recommendation is not adopted insofar as it

concludes that the Commissioner correctly calculated the income

which the claimants had available from their mother for ordinary

living expenses, and the case is REMANDED to the Commissioner for

further proceedings in accordance with this Opinion and Order. 

On remand, the Commissioner shall also reconsider the issue of

whether Mr. Lee made additional but undocumented contributions

toward the claimants’ support and shall determine the amount of

insurance premiums which he paid for them which is fairly

allocable to their coverage. To that extent, the plaintiffs’

statement of specific errors (Doc. 14) is SUSTAINED.

IT IS SO ORDERED.

 s/ George C. Smith 

GEORGE C. SMITH, JUDGE

UNITED STATES DISTRICT COURT

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