Court Opinion

ID: 9725387
Source: CourtListenerOpinion
Date Created: 2023-08-26 11:44:37.464811+00
Date Added: 2024-06-11T18:25:14.680489
License: Public Domain

GOODWIN, Circuit Judge
(dissenting):
There are three principal issues implicit in the plaintiffs’ Supremacy Clause challenge. First, does 42 U.S.C. § 1396a(a) (17)(D) permit imputation of income from one spouse to another in the absence of a state mechanism for enforcing the financial responsibility of relatives? Second, is the amount imputed under the state scheme reasonable within the meaning of 42 U.S.C. § 1396a(a)(17)(C)? Third, may the state continue to impute income from one spouse to another if one spouse is institutionalized?
With respect to the first issue, 42 U.S.C. § 1396a(a)(17)(D) does permit imputation in the absence of a state enforcement mechanism. Subparagraph (D) provides that a state plan may not “take into account the financial responsibility of any individual for any applicant or recipient of assistance under the plan unless such applicant or recipient is such individual’s spouse * * *.” (Emphasis added.) There is no suggestion in the language of the statute or the legislative history that a state’s ability to “take into account” a spouse’s financial responsibility is contingent upon the existence of a state legal mechanism to compel the discharge of that responsibility. Nor does the implementing regulation suggest this. See 45 C.F.R. § 248.21(a)(2)(ii) (1973).
Second, the amounts imputed are, under the facts of this case, “reasonable” within the meaning of 42 U.S.C. § 1396a(a)(17)(C). Subparagraph (D) provides for downward adjustment of any imputed amount to reflect “the costs * * * incurred [by the individual] for medical care or for any other type of remedial care recognized under State law.” The federal provision fails to specify in any greater detail the manner *1380in which the imputable amount is to be determined. This lack of detail suggests that the draftsmen intended to defer to administrative determinations by the various states, which would presumably be guided by state laws concerning spousal financial responsibility.
If a reasonableness standard applies, the state plan, as implemented in these cases, is reasonable within the meaning of 42 U.S.C. § 1396a(a)(17)(C). The state subtracts from the gross income and resources of the non-institutionalized spouse the basic welfare standard and imputes the remainder to the institutionalized spouse. While it may be myopic for the state to disregard certain financial dislocations inherent in living apart, as well as the realistic cost of car repairs and mortgage payments, this myopia is not inconsistent with the federal scheme. Federal regulations contemplate precisely such a computational technique in analogous evaluations of gross income available to “medically needy” aid recipients or applicants. See 45 C.F.R. § 248.21(a)(3)(i)-(ii) (1973). The same method surely cannot be so “unreasonable” here as to confound the state scheme under the Supremacy Clause.
Any supremacy problem which might arise if a non-institutionalized spouse’s income were not adjusted downward to reflect his own medical expenses (see 42 U.S.C. § 1396a(a)(17)(D)), is not in issue.
The more difficult issue is whether the “actually available” language of regulations implementing 42 U.S.C. § 1396a(a) (17)(B) cancels out, in effect, the provision of § 1396a(a)(17)(D) permitting states to take certain relative responsibilities into account.
The plaintiffs have conceded that since financial eligibility for Medicaid is determined by requirements of the categorical assistance programs,1 the exceptions built into those programs with respect to the presumption of availability of income and resources apply for the purpose of determining the amount of medical assistance. The effect of this concession is to temper the seemingly absolute prohibition against imputation of income not actually made available which emerges from a strict reading of 42 U.S.C. § 1396a(a)(17)(B), the legislative history of this provision,2 and 42 C.F.R. § 248.21(a)(2)(i) (1973). Imputation is proper, then, when the spouse of an aid recipient is “living with him in the same household.” 42 U.S.C. § 1382c(f)(l).
The next question is whether this exception is to be read literally to preclude imputation when one spouse is institutionalized. The plaintiffs urge that spousal income imputation should be strictly limited to the situation where spouses are living together in the same physical space. They argue that imputation is rational in this situation alone because (1) only when two spouses physically live together do they enjoy economies of scale such as shared rent, and (2) only when they physically live together is actual sharing sufficiently probable to justify the presumption.
Neither of these arguments requires a literal reading of the exception. The first argument goes not to the propriety of imputation per se but rather to the method of evaluating any income imputed. While it might be desirable if the state were to recognize in a more realistic and humane manner the financial dislocations caused by institutionalization of a spouse, the state cannot be compelled to do so if the state’s evaluation technique is “reasonable” within the meaning of the federal statute.
The plaintiffs make no showing that the likelihood of actual sharing is significantly reduced by an involuntary separation resulting from the institutionalization of one spouse.
*1381It is more plausible to read the exception as continuing to apply even after such involuntary separations. If the spouses are physically living together in the same household immediately prior to the institutionalization of one spouse, then the institutionalization must be viewed as a temporary absence from home necessitated by illness. Any other interpretation would allow the non-institutionalized spouse to thwart at will the policy of 42 U.S.C. § 1396a(a)(17)(D), which permits states to take into account spouses’ financial responsibility to one another.3
I would hold that the challenged regulations are consistent with the Social Security Act and its implementing regulations.

. These programs comprise Aid to Families with Dependent Children, Aid to the Blind, Aid to the Permanently and Totally Disabled, and Old Age Assistance, as well as the new Supplemental Security Income program that absorbs the latter three adult categories.

. See H.R.Rep.No. 213, 89th Cong., 1st Sess. 67 (1965); S.Rep.No. 404, 89th Cong., 1st Sess. (1965), U.S.Code Cong. & Admin.News p. 2018.

. Statutory language should not be given a literal interpretation when the effect would be to thwart the purpose of the over-all statutory scheme. See, e. g., United States v. Public Utilities Commission of Calif., 345 U.S. 295, 315, 73 S.Ct. 706, 97 L.Ed. 1020 (1953).