Doe v. Doar

Court Strikes Down Regulation that Reduced Public Assistance Benefits to Families with Disabled Household Members

October 1, 2007

Author: Susan C. Antos

On September 13, 2007, after over three years of litigation, the class action Doe v. Doar concluded when Monroe County Supreme Court Justice David Egan signed a judgment declaring that 18 NYCRR 352.2(b) is invalid because it violates Social Services Law §§131-a; 131-c and 209.1  The decision will affect tens of thousands of low income families with disabled household members who were underpaid public assistance benefits and who will now collectively receive retroactive awards totaling tens of millions of dollars.

The challenged regulation, which was effective July 7, 2004, had repealed the rule that required that Supplemental Security Income (SSI) be considered invisible when calculating the eligibility and amount of public assistance due to families with children where at least one household member received SSI.  The rule required that member of the household on public assistance be provided with pro-rated grants.  At the time the rule was enacted, the Office of Temporary and Disability Assistance (OTDA) estimated that the regulation would reduce public assistance benefits to $30 million per year.2

On September 14, 2007 OTDA issued a General Information System (GIS) message (06 TA/DC011) to all social services districts advising them that pro-rated budgeting is no longer permissible.  Because there are approximately 27,000 open Doe cases, it will take a few months for currently budgeted Doe cases, it will take a few months for currently budgeted Doe cases to be restored.  However, for all newly opened cases, current cases where a household member receives SSI for the first time and all pending fair hearing decisions, the effect of the judgment in Doe should be immediate.  Further, effective September 14, 2007, Doe pro-ration may not be applied to families that applied for public assistance before that date, but who were still in application status on September 14.3

On October 16, 2007, OTDA issued Administrative Directive 07 ADM-06 advising districts how to re-budget open cases and provide and calculate retroactive benefits to all eligible class members.  Most open Doe cases will be restored through mass re-budgeting (MRB), also called mass authorization (MRA).  However, MRB procedures will differ between New York City and the Rest of the State (ROS).  This is because New York City coded Doe cases in a way that makes them easily identifiable.  Outside of New York City, the Welfare Management System computer can not differentiate Doe cases from cases which are pro-rated for other reasons.  Therefore in the ROS, local districts will have to individually review all pro-rated cases.

Rest of the State

By October 13, 2007, OTDA will provide social services districts outside of New York City with a list of all active Doe cases that are coded as pro-rated.  Doe cases will be a substantial sub-set of these cases.  Within three weeks, the districts will be expected to have reviewed these lists, and determined whether the cases involve Doe pro-ration and if the case is an active Doe case.  A case is considered active on September 14, 2007, even if the case was clocking down to close on that date or after that date. 4  If the case is an active Doe case, the district will remove the pro-ration at the next contact, the next recertification, but no later than 6 months after having received the lists.  At the same time that the case is re-budgeted, the worker must determine and authorize the retroactive benefit. 5  

Doe class members will not receive retroactive benefits based on the actual amount that each household was underpaid.  Each household’s retroactive award will be based on a formula, calculated as follows:  the worker will count the months since the first month of Doe budgeting and multiply that number by a number that equals the difference between the case properly budgeted and Doe budgeted at the point in time that the pro-ration is being removed. 6  If the case was Doe budgeted on in July 2004, the effective date of the invalid regulation, the retroactive award will go back to that date.  If there were breaks in assistance and the pro-ration was in place at the time of each closing, and the household remained in the district, and became eligible for public assistance again with the same head of household, the district will count the closed as well as the open months in calculating the underpayment. 7  The calculation will apply regardless of other changes in the case (i.e. income, household size) during the months that the retroactive award is being calculated.

By April 13, 2008, the local districts will have reviewed all the cases on the list.  All active Doe cases will receive a notice advising them of the amount of the prospective and retroactive relief and an explanation of how retroactive relief was calculated.  OTDA will review the lists which have been processed by the ROS districts no later than  June, 2008 to assure that all cases have been identified, benefits issued and notices sent.

New York City

Before November 13, 2007, OTDA will run a MRB for all open Doe cases in New York City.  This MRB will budget the household prospectively.  No later than March 13, 2008, OTDA will run a second MRB to calculate retroactive benefits.  This calculation will take the difference between the public assistance grant before and after pro-ration (calculated for one snapshot month) multiplied by the number of payment cycles that the person received reduced payments.  As in ROS calculations, periods of ineligibility will be countable months so long as the case maintained the same head of household.  Months that the household lived out of the district will be excluded.  Persons  will receive a written notice advising them of the  amount of retroactive relieve and how such relief was calculated.  The retroactive benefits will be paid within 15 days of the written notice.

How Will Class Members Get Their Retroactive Benefits?

Retroactive benefits will be issued on the recipient’s Electronic Benefit (EBT) card.  Many stores have limits on the amount of cash that can be distributed at one time—often no more than $200.  Because many class members will be receiving thousands of dollars in retroactive benefits, they may have to go to a bank instead of a grocery store to get their cash.  Class members should go to ATM case dispensing machines located at participating banks that do not charge a fee.  These banks can be located by zip code at:  http://www.otda.state.ny.us/main/ebt/zips/default.asp.

Fair Hearing Rights

Individuals will have a right to receive a fair hearing regarding the calculation of their retroactive benefits.  However, because the methodology calculating liquidated damages by use of a formula is part of the court order, the fact that the retroactive benefits were not individually calculated by were calculated by formula will not be hearable.  For example, an Appellant may properly assert that the agency did not count the correct number of months in the formula.  The Appellant who asserts that the underpayment does not represent their actual underpayment will not be successful at the fair hearing.

Cases That Have Moved From One Social Services District to Another

Where Doe households have moved from one social services district to another, advocates will have to monitor closely to assure that their clients receive all of the retroactive benefits to which they are entitled.  The ADM requires that the current district of residence must calculate the monthly underpayment amount using the formula set forth above and issue the retroactive payment for the months that the individual resided in the social services district.  The current district will then notify the former district and using the monthly underpayment amount calculated by the current district, the former district will pay its share of the retroactive award based upon the number of months that the Doe class member resided in the district. 8

Local districts are not allowed to apply the retroactive Doe underpayment against any existing overpayment. 9 

Treatment of Retroactive Awards:  Effect on Food Stamps and Medicaid

The retroactive award will not be considered as income or as a resource for public assistance purposes.  So long as the family remains categorically eligible for public assistance, the retroactive payment will not affect food stamps.  If the family loses categorical eligibility (i.e. they are eligible on September 14, 2007, but are non longer eligible) the payment will be treated as a resource until January 1, 2008. 10  With respect to Medicaid, the payment will be excluded as income in the month received and excluded as a resource for the following month.  If any of the award remains in the following month it will be counted as a resource. 11 

Aid Continuing Recoveries

Doe class members who contested Doe budgeting at a fair hearing and received aid continuing while their hearing was pending may be re-budgeted in one of two ways.  If the district calculates the under payment from the effective date of the reduction (i.e. after the hearing was lost and aid continuing ended, then the overpayment on the books will be deleted and the class member will be reimbursed for any aid continuing overpayment recovered through recoupment.12  If the district calculates the underpayment as of the effective date of the notice, and issues a retroactive award covering those months, the aid continuing overpayment will remain on the books.  For clients that have their underpayments corrected this way, it is sure to be confusing!!

What if the Head of Household Changed?

If a grandparent caregiver has two children in her care, one of whom is on SSI and one of whom is on public assistance, the public assistance child would have been Doe budgeted (1/2 of a grant for two), and should be re-budgeted as a grant for one person.  OTDA has taken the position that if the caretaker relative changes (for example if an aunt became a care giver), no payment will be issued to a current caretaker for a period that of a former caretaker head of household.  The ADM indicates that exceptions can be made to this rule.  If you have a client in such a situation, and are unable to resolve it in your client’s favor, please contact Susan Antos at the Empire Justice Center.

Supplemental Security Income Awards Paid to Family Assistance Households

A person in a Family Assistance household who becomes eligible for SSI has their retroactive SSI benefits adjusted downward based on information that the local social services district provides to the Social Security Administration (SSA).  The local district sends the SSA a form which reports the difference in the Family Assistance benefits payable to the household with and without the SSI recipient in the budget for each month that the person received retroactive SSI benefits.  The award is reduced by this differential.  Because many districts (not New York City), reported the prorated differential which resulted from Doe budgeting, these families received an underpayment of SSI benefits.  OTDA has agreed to correct this underpayment in all Doe households where the household is currently eligible for public assistance.  The Empire Justice Center is exploring whether there is a remedy available through the SSA for families that are not eligible for the OTDA retroactive benefit.  If you have a client in such a situation, please contact Susan Antos at the Empire Justice Center.

Closed Cases

Tell your clients—DO NOT IGNORE THIS LETTER!!  Persons who no longer have household members on public assistance must go through a complicated process to preserve their right to ever receive a retroactive payment.  It is most important that they promptly respond to correspondence from OTDA and their local district to preserve their rights.  OTDA has maintained a file of potential Doe class members with closed cases, and these names will be matched against other case information in WMS (i.e. food stamps, Medicaid) to get the most current address.  No later than January 13, 2008, OTDA will send a letter to all persons who received reduced benefits as a result of Doe budgeting but who no longer have open public assistance cases.  The letter will advise the class members that they have 60 days to have their eligibility for public assistance evaluated and will ask that a form be returned in a prepaid envelope addressed to OTDA, not the local social services district.  It is most important that you advise your clients to respond to this letter, even if they are not eligible for assistance now.  Persons who fail to respond within 60 days and who fail to reapply are foreclosed from receiving a retroactive Doe award in the event that they become eligible for public assistance in the future. 13

Persons who do respond will be given an appointment.  Persons may reschedule their appointment if they make a request to do so within 60 days of the date of the letter.  Persons who come in for an appointment will have to reapply for benefits.  They will not have to go to orientation or job activities and will not have to verify any elements that have previously been documented (social security number, date of birth, citizenship). 14  They will have to document anything that has changed (household composition, income).  If the person is found eligible for ongoing public assistance the district must open the case.  Once the case has been opened, ROS districts must issue retroactive benefits within 30 days if the case is a Family Assistance case and within 45 days if the case is a Safety Net Assistance case.  In New York City, an MRB will be conducted for each closed case within 180 days of the date that the closed case list is provided to HRA by OTDA on or before November 13, 2007.

Retroactive Relief for Persons Not Eligible for Ongoing Public Assistance

As a general rule, persons who are not eligible for ongoing public assistance will not receive a retroactive benefit unless their cases are reopened.  Class members who are not currently eligible for public assistance will receive a letter setting forth the amount of retroactive benefits that they will be entitled to receive if they become eligible for public assistance in the future.  If they become eligible for public assistance in the future, they will receive retroactive benefits if they present this document to their caseworker. 

Fast Track Relief

Over the course of this litigation, many class members were brought to the attention of counsel for the plaintiffs.  For those identified class members who reside outside of New York City, will received retroactive benefits on or before November 13, 2007, whether or not their cases are open or closed.

Rice Budgeting Still Intact for Households Consisting Only of Adults

The decision in Doe only affects those households that have a disabled household member and contain a child.  The pro-rated budgeting which applies to adults who live in households without children, often called Rice budgeting, still applies where one of the adults receives SSI and is legally responsible for the other adult in this household. 15

The Plaintiff class in Doe was represented by Bryan Hetherington and Susan Antos of the Empire Justice Center, Jane Stevens of the New York Legal Assistance Group, Marc Cohan of the National Center for Law and Economic Justice and Richard Blum and Scott Rosenberg of the Legal Aid Society in New York City.

Footnotes

1   The judgment and the remedial plan are posted in the Benefits Law Database section of the Online Resource Center at http://onlineresources.wnylc.net/welcome.asp?index=Welcome.  The GIS message and the ADM are also posted to the Online Resource Center.

2  New York State Register, January 21, 2004, p.15, available at:  http://www.dos.state.ny.us/info/register/2004/jan21/pdfs/rules.pdf

3  07 ADM-6, p.4

4  Id

5  Id. at 8

6  Id

7  Id. at 9

8  Id. at 14.

9  Id. at 4.

10  Id. at 16

11  Id.

12  Id. at 15

13  The remedial plan provides one narrow exception to this time limit:  “Such time limit for response is without prejudice to any right such class member has under any provision of law to claim good cause for failure to have timely asserted his or her right to respond to the letter timely.”

14  07 ADM-6 11.

15 See 94 ADM-10, available at http://onlineresources.wnylc.net/pb/docs/94_adm-10.pdf, for a description of Rice budgeting.  For more information about the Rice cases, visit the Benefits Law Database on the Online Resource Center at:  http://onlineresources.wnylc.net/welcome.asp?index=Welcome.