# Opposition Brief — Perales v. Krieger

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Opposition Brief
- **Published:** January 1, 1988
- **Citation:** 484 U.S. 1019

## Text

Supreme Court, U.S.
FILED

NOV 20 987

JOSEPH F. SPANIOL’ UP
CLERK

No. 87-545

In The
SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1987

CESAR A. PERALES, as Commissioner of
the New York State Department of
Social Services,
Petitioner,
- against -

MILDRED KRIEGER,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI
TO THE NEW YORK STATE COURT OF APPEALS

BRIEF IN OPPOSITION

KALMAN FINKEL
Attorney-in-Charge
Civil Division
The Legal Aid Society

JOHN E. KIRKLIN JOAN MANGONES

Director of Litigation Attorney-in-Charge

Civil Appeals & Law Reform Unit Staten Island Neighborhood

JANET SABEL, of Counsel Office

11 Park Place - Room 1805 LESTER HELFMAN, of Counsel

New York, NY 10007 25 Hyatt Street

(212) 406-0745 Staten Island, NY 10301
(718) 273-6677

Attorneys for Respondent

QUESTIONS PRESENTED

1. Whether this Court lacks jurisdiction under Article III
of the Constitution to review a judgment that no longer presents
a case or controversy, the respondent Mildred Krieger having
received all the disputed Medicaid benefits from the
Commissioner of the New York City Department of Social Serv_-ces,
a party to the proceedings in the trial court below who did not
appeal that court’s adverse decision to the New York Court of
Appeals or seek review in this Court?

2. Whether this Court is without jurisdiction to review a
New York Court of Appeals judgment premised on an independent and
adequate state law ground, to wit that a Medicaid eligible
Claimant who has promptly paid her bills is entitled under the
New York Social Services Law and New York State case law to
Medicaid reimbursement for medical expenses incurred three months
prior to her application for Medicaid benefits?

3. Whether this Court should decline to review a _ state
court judgment to the extent that it concerns the weight to be
given a federal agency letter pursuant to the Administrative
Procedure Act where that decision is supported by an independent
federal law ground not challenged on certiorari, to wit that the
Freedom of Information Act’s publication requirement deprives the
unpublished agency letter on which petitioner relies of any force
and effect in determining the claimant’s rights?

4. Whether, absent a conflict among the federal circuit
courts or other state courts regarding an issue of limited
significance and consequence, this Court should deny certiorari
to review the New York Court of Appeals’ unexceptionable rulings
that (i) a Medicaid eligible claimant who promptly paid her

bills is entitled to Medicaid coverage of the same amount,

ii

duration and scope for the three months prior to the -month of
their application as a claimant who fail to pay her bills, and
that (ii) an unpublished agency letter on which petitioner relies
is of no binding force and effect in determining claimant’s
rights where that letter was not promulgated in accordance with

the notice and comment rulemaking requirements of the

Administrative Procedure Act?

TABLE OF CONTENTS

QUESTIONS PRESENTED. . . «© «© © © © © ee © @ «@

TABLE OF AUTHORITIES .. «© «© s ee ee © © 6

CONSTITUTION, STATUTES AND REGULATIONS ....

Gn eee. nc te ee eS Oe

COUNTERSTATEMENT OF THE CASE ......+ e+e -

Me EBCECGUCCIOS 4c cio se we eee
B. Statutory Seheme . . 2. st ese eae ss
Os" Oe eb a ee ae) 8 eae ea eee

REASONS FOR DENYING THE WRIT . . « «© « © « © «

Be BECAUSE ONE PARTY TO THIS LITIGATION
LACKS A PERSONAL STAKE IN THE OUTCOME OF THE
PROCEEDING, THE PETITION PRESENTS NO CASE OR
CONTROVERSY SUFFICIENT TO ESTABLISH
JURISDICTION UNDER ARTICLE ESS OF THE
CONSE LU EON 16) oe Ss ew Re ee el te wee a ee

pe THIS COURT IS WITHOUT JURISDICTION TO
REVIEW A NEW YORK COURT OF APPEALS JUDGMENT
PREMISED ON AN ENTIRELY INDEPENDENT AND
ADEQUATE STATE GROUND, TO WIT THAT UNDER THE
NEW YORK SOCIAL SERVICES LAW AND NEW YORK
STATE CASE LAW, MEDICAID ELIGIBLE CLAIMANTS
WHO HAVE PROMPTLY PAID THEIR BILLS ARE
ENTITLED TO MEDICAID REIMBURSEMENT FOR MEDICAL
EXPENSES INCURRED THREE MONTHS PRIOR TO THEIR

APPLICATION FOR MEDICAID BENEFITS. ......

III. CERTIORARI TO REVIEW THE EFFECT OF THE
ADMINISTRATIVE PROCEDURE ACT ON THE WEIGHT
ATTRIBUTED TO AN UNPUBLISHED AGENCY LETTER IS
INAPPROPRIATE IN THIS CASE BECAUSE THE STATE
COURT DECISION ON THAT ISSUE IS SUPPORTED BY
AN INDEPENDENT AND ADEQUATE FEDERAL LAW
GROUND, NOT CONTESTED BY PETITIONER HERE, TO
WIT THAT THE PUBLICATION REQUIREMENTS IN THE
FREEDOM OF INFORMATION ACT DEPRIVE THE
UNPUBLISHED LETTER ON WHICH PETITIONER RELIES
OF ANY FORCE OR EFFECT IN DETERMINING THE
BENBPITS DUE RESPONDENT <« . 2 s+ « + « s © « «

iv

Si

vi

viii

is

|

14

IV. THIS COURT SHOULD DECLINE TO EXERCISE
ITS JURISDICTION TO REVIEW THE NEW YORK COURT
OF APPEALS DECISION BECAUSE THAT COURT’S
JUDGMENT CREATES NO CONFLICT AMONG THE
FEDERAL CIRCUIT COURTS OR OTHER STATE
COURTS, RAISES NO IMPORTANT OR SIGNIFICANT
FEDERAL LAW QUESTIONS, AND WAS CORRECTLY
Gaetan & 6 A Ss e868 we 8 eee Oe ee

A. MEDICAID ELIGIBLE CLAIMANTS WHO
PROMPTLY PAID THEIR BILLS ARE ENTITLED TO
MEDICAID COVERAGE OF THE SAME AMOUNT,
DURATION AND SCOPE FOR THE THREE
MONTHS PRIOR TO THEIR APPLICATION AS
THOSE CLAIMANTS WHO FAIL TO PAY THEIR
Dates 6. 26 eS ete. Oe es eee ew

B. AN UNPUBLISHED AGENCY LETTER NOT
PROMULGATED IN ACCORDANCE WITH THE
NOTICE AND COMMENT RULEMAKING
REQUIREMENTS OF THE ADMINISTRATIVE
PROCEDURE ACT IS OF NO BINDING FORCE
AND EFFECT IN DETERMINING CLAIMANTS ’
Mares 60 8% oe es ee ee Oe ee Ae

GONGHUGEON 2.6 6 8 o-6 te ee ell le

id i 2 ® Gt Va a a a a a ee a a

16

17

LS

23

Al

TABLE OF AUTHORITIES

Tiburon,
Zoo Aveo). « 2 « 6 6 «6

Agins v.
647 U.S.

Anderson v.
550 F.2d 459

Butz,
(StH Cir.

1977) .

Francis,
Paerels ss « S *

Batterton v.
432 U.S. 416

Marshall,
(D.G.. Ci®.

Batterton v.
486 F.2d 694

1980).

Beal v.
432 U.S.

Doe,
438

et Paes

Schweiker,
(Sth Cir.

Buschmann v.
676 F.2d 352

1982) .

Calkins v. Blun,
511 F.Supp. 1073 (N.D.N.Y. 1981)
remanded, 657 F.2d 44 (2d Cir.

Canaday v. Koch,
608 F.Supp. 1460 (S.D.N.Y.),
768 F.2@ SOL (2a Cir.

1985)...

Carter v.
493 F.Supp.

Blun,
368 (S.D.N.Y.

1980).

Marshall
1980).

Cerro Metal Products v.
620 F.2d 964 (3d Cir.

Chrysler Corp. v. Brown,
SAS Ure< 208. (CASO) « 6 ss Be 8

Columbus Community Hospital, Inc

LS;

20,

» BLE’d ang

BOGGS 6x: s 6

aff’d,

,

20

v. Califano,
614 F.2G i181 (8th Cir.

1980)

Donovan v. Wollaston Alloys, Inc

27

695 F.2@ i (ist Cir. i962) .

Espinoza v. Farah Mfg. Co.,
B14 U.S. 66. (ES73) ss

Federated Department Stores,
Inc. v. Moitie,
a SR ee ee ee

General Electric v. Gilbert,
429 U.S. i25 (i976). . = « ©

Harris v. McRae,
e486 0.8. 207 (1960). . ss se

Hodecker v. Blum,
$25 F. Supp. 867 (N.D.N.Y.
685 F.2@ 424 (2a Cir.

1981)
1982).

, aff’d,

vi

13

20

21

21

ao

14

10

12

14

20

20

20

i5

ee

ai

a3

19

Holley v. Lavine,
605 F.2d 638 (2d Cir. 1979), cert. denied

sub nom. Blum v. Holley,
S06 Us BAe CEPR): 6 6 6 ee ee ew ee 9

Indianapolis School Commissioners
v. Jacobs,

420 Uibs Bae CAPO) 2 sak 8 ee Be ees 10
King v. Smith,
392 U.S. JOD (2968). 2. s « we ew we ee Ye he he i?

iegl v. Webb,
802 P.2@ G23 (20 Civ. i966). 2. 6 & & ws ees ai

Linoz v. Heckler,
800 F.2d 871 (9th Cait. ISS6) cs 6-6 we We 6 20

Matter of Adirondack League Club

v. Board of Black River

Regulating Dist.,

302 Nils 249, SS Nis.

4G GA? C2SS0)s se es ee ee eee EO we 9

- Matter of Cheng San Chen v. Toia,
; 67 A.D. 24 1065, 415 H.Y¥.S. i69
(2d Dept. 1979), aff’d 50 N.Y. 2d 826,
407 N.S. 2@ 1346, 430 N.¥.S. 2d 50 (2980). . .« 2

Matter of Cole v. Wyman,
40 A.D. 2€@ 1033, 338 N.Y.S. 20 $64
(24 DOP G. ZS72 ic. eo eS el Oe oe om ees 12

Matter of Jones v. Berman,
37 N.Y. 26. 42, S32 Bub. 24 S03; S71
B.F.8. Oe Side 3 6 ee She we me OES, et ew, oe Se 10

Matter of Krieger v. Krauskopf, -4

126 Hise. 2a 70, 461 N.iY¥.8. 24 219

(Sup. Ct. 1984), aff'd, 121 A.D. 2d 448,

503 N.Y.S. 2d 418 (2d Dep’t 1986),

aft’d, 70 N.Y. 24° 637, Si2 N.E. 2a 540,

Sis Ni¥.S. 26 S67 (i967)... «© ss es te 6 a By Gy Fe hey. 25

Matter of Lustig v. Blum,
$0 A.D. 24 558, 435 N.iiS. 24. 350
(20 DOp’S OPS). «es se ee eee ee Uhl ee ai

Matter of Lyon Co. v. Morris,
226i NuiY. 497, 255 Bibs FEE C2985). « cs ek we He 9

Matter cf Schwartz v. Toia,
68 A.D. 2d 890, 414 N.Y¥.S. 2d 23
(26 BOR" = 2979} «we & st ee se Se eS eH me

Michigan v. Long,
463 UcS. i032 €9GS) « «6 0 te wR we RO ee pe ae os

Morton v. Ruiz,
S35 Gis Bee Ceres 6 ks sk SE ee BP ee 15, 20, 21

National Nutritional Food Ass’n

v. Weinberger,

512 F.2d 688 (2d Cir.), cert. denied,

433 U8. ORT C3978) wk es 8s he Be Se es 20

vii

|
|

North Carolina v. Rice,
O04 Ucbs 258 (CA073)5 4 6 se oS 8 lt me

Oberlander v. Perales,
van Tiae tae (ea: Cat.. 2984). «so ows

O’Brien v. Skinner,
eae Vews Cen Tarrels « 6 ss se & + 6 ee 8

Powderly v. Schweiker,
VOS Eevew- agse (9tn Cir. 2963). «2. & & «© «ss

Preiser v. Newkirk,
ee is ee CPEs 6 «6 & Soe eee

Schweiker v. Hansen,
450 U.S. 785 (1981)... .. »@

SEC v. Medical Committee
for Human Rights,
404 U.S. 403 (i972). « « «

Sockin v. Overcash,
45 A.D. 2d 717, 356 N.Y.S. 2d 329
(2d Dep’t 1974). ......6.6.

Smith v. Miller,
665 F.2d 172 (7th Cir. 1981)

St. Mary’s Hospital of Troy
v. Blue Cross & Blue Shield Ass’n,
788 F.2d 888 (2d Cir. 1986).

Townsend v. Swank,
404 U.S. 282 (1971).

United Housing Foundation, Inc.

v. Forman,
421 U.S. 837 (1975).

CONSTITUTION, STATUTES AND REGULATIONS

U. S. CONSTITUTION

Article III

5 U.S.C.

552
552(a) (1) ‘

552(a)(1)(D). . . 2... ew we
ns © Ce

Mmmm

42 U.S.C.

1396. °
1396a(a) (5)
1396a(a) (8)
1396a(a) (10)
1396a(a) (10) (B)

MOM Mm mM

viii

20,

10

12

a3

21

10

rp |

10

12

20

20

12

21

10

MwWWN NY

ee Yea Se 18

N,N ade ee eee ae 18

DEE i ate’ oe aoe ak 3

Re a ae re er ce i. &
42 C.F.R.

RRC. 2 eee ee 2

SNR, bs ee ee we be 3, 18

N.Y. CIV. PRAC. LAW

Wi as ber ar re Or a eg a ee 5
a eae ag ae ee er 5

N.Y. SOC. SERV. LAW
“. +s 2
§ 365. ae a ter mies ta Ret nae oe 3
BO | ee ree 3
CME ERREDD es 6 3 ss 6 oe wo 4
ee ara ann fe ae oe
eres kok ae Kk ee 8 ee ee :, §. 33

N.Y. ADMIN. CODE TIT. 18

ae ee ee oe ee es 2
G 2OUreGe. wc se sa wseenves vee a, @
PS: ae ee ee ee ee ee ee ee 3
ee & ee ee a a ee ee ee 4

OTHER AUTHORITIES

Cohen and Karger, Powers of the New York Court of
Appeais (1951) «© «© «© se» exes «sees oe 6 6 © @ G

H.R. Rep No. 92-231, 92d Cong., 2d Sess.
reprinted in (1972) U.S. Code Cong. &

Admin. News 4489, 5099 18

ix

No. 87-545

In The
SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1987

CESAR A. PERALES, as Commissioner of
the New York State Department of
Social Services,
Petitioner,
- against -

MILDRED KRIEGER,

Respondent.

ON PETITION FOR A WRIT OF CERTIOFARI
TO THE NEW YORK STATE COURT OF APPEALS

BRIEF IN OPPOSITION

Respondent respectfully submits this brief in opposition to

the petition of the Commissioner of the New York State Department

of Social Services for a writ of certiorari to review

judgment of the New York State Court of Appeals.

COUNTERSTATEMENT OF THE CASE

A. Introduction

Petitioner’s selective statement of the case

misleading. First, petitioner fails to disclose that

the

is

the

Commissioner of the New York City Department of Social Services,

who alone was ordered by the trial court to reimburse respondent

for her paid medical expenses, chose not to appeal from the
original judgment and instead fully complied with the payment
order. Accordingly, in its present posture, this case presents
no case or controversy between the parties to this proceeding.
Second, the decision of the New York State Court of Appeals was
based independently and adequately on New York Social Services
Law § 367-a(1) (McKinney 1983) and an uninterrupted line of state
court cases interpreting that statute. This Court, therefore, is
without jurisdiction to grant the petition. Finally, with
respect to the challenge to the analysis of the Administrative
Procedure Act, petitioner failed to disclose that the state court
found the federal agency letter of no binding force or effect
under the Freedom of Information Law, an alternate federal law

ground uncontested by the State in its petition to this Court.
B. Statutory Scheme

The Medical Assistance Program ("Medicaid") is designed to
meet the medical expenses of needy individuals who satisfy the
program eligibility requirements. The United States Department
of Health and Human Services ("HHS") is authorized to make pay-
ments under the Medicaid program to states whose plans conform to
the specific requirements of Title XIX of the Social Security
Act, 42 U.S.C. §§ 1396 et seg. (1983). New York State partici-
pates in the Medicaid program and receives federal funding under

its state plan.1 New York Social Services Law §§ 363 et seg.

4 Federal law also requires that a state Medicaid plan be
administered or supervised by a "Single state agency." 42 U.S.C.
§ 1396a(a) (5); 42 C.F.R. § 431.10 (1986). In New York, the
petitioner, New York State Department of Social Services
("NYSDSS"), is the designated single state agency. The

NYSDSS has delegated its authority to make initial eligibility
determinations to local social services districts. In New York
State each county comprises a social services district except

the five counties of New York City which make up a single social
services district. Each local social services district is headed
by a county social services commissioner, or in the case of New
York City, a city social services commissioner. Determinations
made by the local Social Services Commissioners are reviewable by
the State Commissioner through an administrative hearing. N.Y.

All participating Stat#s must provide Medicaid to all persons
who fall within certain groups. These groups are referred to as
the “categorically needy." In addition, States may choose to
provide assistance to "medically needy" groups. If a group is
covered as categorically or medically needy, the State must
follow, at a minimum, all federal requirements.

Under New York’s Medicaid program, elderly persons who would
be eligible for benefits under the federal Social Security Income
("SSI") program but for their ineonn and resources are a
medically needy group. N.Y. Soc. Serv. Law § 366(1) (a) (5)
(McKinney 1983). Accordingly this group must receive benefits in
conformity with all federal and state requirements. The federal
law requirements include provisions that Medicaid be furnished
for care and services provided in or after the third month before
the month in which the Medicaid application was made if the
applicant was eligible for medical assistance at the time such
care and services were provided. 42 U.S.C. § 1396a(a) (34); N.Y.
Admin. Code tit. 18, § 360.16 (1986). In addition, payment must
be made to an eligible individual cr the person or institution
which provides the medical service or care. 42 U.8:C.. 4
1396a(a) (32); N.Y. Soc. Serv. Law § 367-a. Such medical
assistance to any individual shall not be less in amount,
duration or scope than that made available to any other eligible
individual. 42 U.S.C. § 1396a(a) (10); 42 C.F.R. § 440-240(b).
Finally, Medicaid must be provided to alli eligible individuals
with reasonable promptness. 42 U.S.C. § 1396a(a) (8); N.Y. Soc.
Serv. Law §365; N.Y. Admin. Code tit. 18, § 360.14 (1986).

Nothing in state or federal law prohibits the State from
providing medical assistance greater than that required under
federal law, although the State may forgo reimbursement for such
benefits. For example, the New York State Medicaid plan provides

for an income deduction for which there is no parallel federal

Admin. Code tit. 18, §358 (1983).

-3-

law provision, N.Y. Soc. Serv. Law § 366(2)(a)(7), and for
certain reimbursable family planning services for which there is
no federal reimbursement, N.Y. Admin. Code tit. 18, § 565.23

(1986).
Cc. Facts

Respondent Mildred Krieger is an 81-year-old widow who
suffers from angina pectoris, hypertension, glaucoma, a duodenal
ulcer, and severe arthritis. Mrs. Krieger is under the
continuous care of physicians and takes prescription medications
for her various ailments. Mrs. Krieger’s sole source of income
at the time of her Medicaid application was a Social Security
widow’s benefit in the amount of $420 per month. From this
limited income, respondent was required to meet all her living
expenses, including those for food, rent, utilities and clothing.
In addition, unaware of the procedures in the Medicaid program or
of her right to receive medical assistance benefits, Mrs. Krieger
was paying her medical bills out of her monthly Social Security
check and her small savings account in the months prior to
applying for medical assistance. Medicaid reimbursement to Mrs.
Krieger for her payment of those covered services was to become
the issue presented in this litigation.

Respondent Mildred Krieger applied for Medicaid through a
local office of the New York City Department of Social Services
("local agency"). When the local agency failed to make an
eligibility determination within 30 days as required by state
regulation,2 respondent commenced a state mandamus proceeding
pursuant to Article 78 of the New York Civil Practice Law and
Rules against the Commissioners of the New York City and New York
State Departments of Social Services to compel them to provide

her with Medical Assistance, and to reimburse her for

2 N.Y. Admin. Code tit. 18, § 360.14 (1986).

'
4.
'

out-of-pocket medical expenses. 3

Through a_ state administrative hearing and a_e subsequent
Stipulation of Partial Settlement in the mandamus proceeding, all
of the issues raised in respondent’s original and amended
petitions were resolved,4 except the issue of respondent’s
entitlement to reimbursement for medical expenses incurred and
paid for during the three months prior to the month of her
application.

The state trial court, relying exclusively on state law,
determined that New York Social Services Law § 367-a(1) did not
prevent direct reimbursement to the respondent and that the
State Commissioner’s failure to order reimbursement for elaimed
medical expenses was "arbitrary and capricious."5 The court,
accordingly, ordered the local agency to reimburse respondent for
medical bills incurred and paid for in the three months prior to

applying for Medicaid. Matter of Krieger v. Krauskopf, 126

Misc. 2d 70, 481 N.Y¥.S.2d 219 (Sup. Ct. 1984).

The local agency chose not to appeal from the lower state

3 Article 78 of the New York Civil Practice Law and Rules is
the state proceeding available to individuals to challenge a
determination of an administrative officer or body to obtain

the relief previously available through the common law writs of
certiorari, mandamus and prohibition. N.Y. Civ. Prac. Law § 7801
et seq. (McKinney 1981).

4 As a combined consequence of the Decision After Fair Hearing
and the Stipulation of Partial Settlement, respondent was found
to be eligible for Medicaid from February 1, 1983, the third
month prior to the month of her application, through June

30, 1983, after incurring medical expenses of $19.80 for each

of those months. She was also determined to be eligible for
Medicaid beginning July 1, 1983 without the need to incur any
medical expenses. Furthermore, the local agency agreed to,

and in fact did, reimburse respondent directly for all medical
expenses which she incurred and paid for out of exempt income and
resources except those incurred during the three months prior to
the month of her application.

| The "arbitrary and capricious" finding by the state court is
a direct reference to the state law Article 78 proceeding. See
supra note 3. Among those questions reviewable in an Article
78 proceeding are "whether a determination was made in violation
of lawful procedure, was affected by an error of law or was
arbitrary and capricious or an abuse of discretion... ." N.Y.

Civ. Prac. Law § 7803 (emphasis supplied).

court’s judgment, thereby binding itself to the mandate of the
court. Accordingly, the local agency issued a check to
respondent for $139.15 (a copy of which is annexed hereto as
Appendix "A") in full compliance with that judgment.

The State Commissioner, however, did appeal. On appeal, the
Appellate Division of the Supreme Court of the State of New York
affirmed, finding no valid basis for denying respondent direct
reimbursement for paid medical expenses. "To hold otherwise,"
the court stated, "would lead to the creation of two classes of
Medicaid recipients, one of which would receive fewer benefits
solely because members of the class paid their medical bills
promptly, and the other which would receive greater benefits by
way of reimbursement to the providers of medical services because
the members of the class did not pay their medical bills

promptly." Matter of Krieger v. Krauskopf, 121 A.D.2d 448, 450,

503 N.Y.S.2d 418, 420 (2d Dep’t 1986). The court rested its -
decision to reimburse Mrs. Krieger for her paid medical expenses
on Section 367-a of the New York Social Services Law, and the
state decisional law construing that statute, which provides that
payment for medical services be made to the provider of services,
except as here, where reimbursement directly to the recipient of
the medical services is required under state law. The court
subsequently noted that federal law offers "further support" for
its conclusion; federal law may also require the direct
reimbursement to Mrs. Krieger for medical expenses incurred and
paid for in the three months prior to the month of her
application for Medicaid. In this regard, the court also stated
that it was not bound to follow the federal agency’s unpublished
letter directive, ruling that the letter announced a_ substantive
rule and was not entitled to full force and effect because it was
not promulgated pursuant to the notice and comment provisions of

the Administrative Procedure Act or alternatively, if the letter

- 6-<-

announced an interpretive rule, HHS’ failure to publish the rule

in the Federal Register, as required by the Freedom of

Information Act of all interpretive rules which adversely affect

citizens’ rights, precludes the enforcement of the interpretive

rule against Mrs. Krieger. Matter of Krieger v. Krauskopf, 121
A.D.2d at 450-451, 503 N.Y.S.2d at 421. The New York Court of
Appeals affirmed and adopted the decision of the Appellate

Division. Matter of Krieger v. Krauskopf, 70 N.Y.2d 637, 512

N.E.2d 540, 518 N.¥.S.2d 957 (1987).

REASONS FOR DENYING THE WRIT

In his petition the Commissioner of the New York State
Department of Social Services asks the Court to render an
advisory opinion on the propriety of dicta in a decision based on
an independent, adequate, and uncontested state law ground,
concerning matters as to which there is no live controversy
between the parties. Prudential considerations and
jurisdictional requirements compel the denial of the petition for

certiorari in this case.

I. BECAUSE ONE PARTY TO THIS’ LITIGATION LACKS A
PERSONAL STAKE IN THE OUTCOME OF THE PROCEEDING,
THE PETITION PRESENTS NO CASE OR CONTROVERSY
SUFFICIENT TO ESTABLISH JURISDICTION UNDER’ ARTICLE
III OF THE CONSTITUTION.

Respondent Mildred Krieger commenced this action against
the New York City and New York State Departments of Social
services ?n July, 1984, to obtain reimbursement for $139.15 which
she spent on health care in the three months prior to the month
of her application for Medicaid. The state trial court entered
judgment for Mrs. Krieger, granting her petition and ordering the
New York City Department of Social Services ("local agency") to
reimburse her for paid medical expenses incurred during the
contested period.& The New York City Department of Social
Services chose not to appeal the trial court’s decision, and
instead, complied with the judgment by paying Mrs. Krieger the

full amount of benefits for which she had sued in the trial

court. The check is attached as Appendix "A".

6 In so ruling, the trial court annulled so much of the
September 13, 1984 decision of the Commissioner of the New York
State Department of Social Services as refuséd to direct the
local agency to reimburse Mrs. Krieger for the monies sought in
the petition.

In its present posture, this case presents no matter in
controversy between the two parties to this litigation because
Mrs. Krieger has no dispute with the petitioner State
Commissioner. 7 Mrs. Krieger was reimbursed by the local agency
-- not a party at this stage of the proceedings -- for the monies
she spent. Any wrongs against her have been fully redressed and
there is no likelihood that she will be confronted with this
situation again. She has nothing further to litigate and no
stake in the ultimate outcome of this proceeding. Even if the
state court judgment were reversed, Mrs. Krieger could mot be
required to refund the monies issued by the local agency; the
City Department of Social Services lost any claim it may have had
to the reimbursed money when it declined to exercise its

appellate rights. See Federated Department Stores, Inc. v.

Moitie, 452 U.S. 394, 398 (1981). Where one of two remaining
parties to litigation utterly lacks a personal stake in the
cutcome of the proceeding, Article III of the United States
Constitution, as well as prudential considerations, compel this
Court to decline jurisdiction and to deny the petition for a writ

of certiorari.&® Preiser v. Newkirk, 422 U.S. 395, 401 (1975);

7 There is no counterpart to the Article III case or
controversy requirement in the New York State Constitution.

The New York State appellate courts, therefore, were free to
determine the State Department of Social Services’ appeal even
in the absence of a case or controversy between the parties.
Appellate determinations are frequently rendered in such cases
where a question of public importance is presented. Matter

of Adirondack League Club v. Board of Black River Regulating
District, 301 N.Y. 219, 222, 93 N.E.2d 647, 649 (1950), Matter of
Lyon Co. v. Morris, 261 N.Y. 497, 499, 185 N.E. 711 (1933). See
also Cohen and Karger, Powers of the New York Court of Appeals

§ 99, pp.420-421 (1951).

8 Furthermore, although not crucial to the outcome here, the
petitioner has demonstrated no concrete financial interest im the
outcome of his current dispute with Mrs. Krieger and has alleged
none. In this case, the local agency chose to reimburse Mrs.
Krieger pursuant to the state court order. The local agency has
the authority to forgo federal reimbursement and pay out Medicaid
benefits that are not approved by the State. Holley v. Lavine,

Indianapolis Schoo] Commissioners v. Jacobs, 420 U.S. 128, 129

(1975); SEC v. Medical Committee for Human Rights, 404 U.S. 403

(1972).
The exercise of judicial power under Article III of the
Constitution depends on the existence of a case or controversy at

all stages of review. Mrs. Krieger no longer has an advers

wv
a |
«

interest in the outcome of this proceeding. Furthermore, the
petitioner’s interest in this proceeding is speculative. The
petition for a writ of certiorari should be denied. reiser

Newkirk, 422 U.S. at 401-402.

3
|
ty

i

605 F.2d 638, 643-645 (2d Cir. 1979) cert. denied sub
v. Holley, 446 U.S. 913 (1980); Calkins v. Blum, 511 F
1073, 1099 (N.D.N.Y. 1981), aff’d and remanded, 675
Cir. 1982). See Matter of Jones v. Berman, 37 N.Y.
332 N.E.2d 303, 310, 371 N.¥.S.2d 422, 431 (1975).
local agency fully paid Mrs. Krieger’s disputed medica
the State’s adversarial interest is speculative, at be
essence, therefore, the Commissioner of the New York S
Department of Social Services has petitioned this Cour
of an advisory opinion to review the merits of the New Y
of Appeals decision. The Court is without jurisdiction
Article III to render advisory opinions or to decide que
that cannot affect the rights of litigants in the case b
it. Preiser v. Newkirk, 422 U.S. 395, 401 (1975), quoting North
Carolina v. Rice, 404 U.S. 244, 246 (1971).

<
nN
ova”

“cowed.

1oO Nn
Qrergansae

~~

- 10 -

II. THIS COURT IS WITHOUT JURISDICTION TO REVIEW A
NEW YORK COURT OF APPEALS JUDGMENT PREMISED ON
AN ENTIRELY INDEPENDENT AND ADEQUATE STATE
GROUND, TO WIT THAT UNDER THE NEW YORK SOCIAL
SERVICES LAW AND NEW YORK STATE CASE LAW,
MEDICAID ELIGIBLE CLAIMANTS WHO HAVE PROMPTLY
PAID THEIR BILLS ARE ENTITLED TO MEDICAID
REIMBURSEMENT FOR MEDICAL EXPENSES INCURRED
THREE MONTHS PRIOR TO THEIR APPLICATION FOR
MEDICAID BENEFITS.

This Court is without jurisdiction to issue a writ of
certiorari in this case because the decision of the New York
Court of Appeals is based on an independent and adequate _ state
law ground. Specifically, the New York court’s judgment
requiring direct reimbursement of the medical expenses incurred
-and paid by Mrs. Krieger in the three months prior to the month
of her application for medical assistance is clearly based on

settled state decisional authority interpreting New York Social

,
Services Law § 367-a(1) (McKinney 1983). See Michigan v. Long,

463 U.S. 1032, 1042 (1983).

Section 367-a(1) of the Social Services Law provides that
payment for medical services under the state Medicaid program be
made to the provider of such services "except as otherwise
permitted or required by applicable federal and state provisions,
including the regulations of the [New York State] [D]Jepartment
(of Social Services]. In this case, as in other similar
circumstances, the New York State courts have read this
"exceptions" Clause of Section 367-a(1) to require direct
reimbursement of medical payments made by Mrs. Krieger under the
state Medicaid plan. The court cited other state court decisions
which required direct payment of benefits to Medicaid applicants
in other contexts, and ruled that state case law should be
extended "by parity of reasoning" to situations where a Medicaid

applicant incurs and pays for medical expenses in the three

i) For example, in Matter of Lustig v. Blum, 80 A.D.2d 558, 435

months prior to the month of her application.? tte £ leger
v. Krauskopf, 121 A.D.2d 448, 450, 503 N.¥.S.2d 418, 420, af££’d,
70 N.¥.2d 637, 518 N.¥.S.2d 957, 512 N.E.2d 540 (1987).

The Commissioner may not by sleight-of-hand transform thi

yw

state law ground for requiring reimbursement of Mrs. Krieger

wv

medical expenses into a federal law question. C£. Oberlander

Perales, 740 F.2d 116, 119 (2d Cir. 1984); Canaday v. Koch, 602

F.Supp. 1460, 1472 (S.D.N.¥.), aff'd, 768 F.2d 501 42a (Cir.
1985). Any conclusion to the contrary "would provide a
jurisdictional basis for federal judicial review of every
disputed state administrative ruling relating to Medicaid."

Oberlander v. Perales, 740 F.2d at 119.

~

Although a state may not adopt a more restr
program than that required by th Social Securi
regulations promulgated thereunder, and then expect federal

reimbursement, see Townsend v. Swank, 404 U.S. 282,

tw
aw
’
4
'

it may adopt, as it has done here, a program that is more

generous than those required by the federal guidelines and assume

the costs of such programs forgoing federal reimbursement. See
ante, p. 3. Matter of Cheng San Chen v. Toia, 67 A.D.2da 1085
1086, 415 N.Y.S.2d 169, 170 (4th Dep’t 1979), aft’d, 50 N.Y.2a
N.Y.S.2d 350 (2d Dep’t 1981), the state court determined that a
Medicaid applicant was entitled to retroactive reimbursement for
funds expended for her medical care due to the local agency’s
delay in approving the applicant’s Medicaid application
court rested its decision exclusively on state law; and )
rejected the Commissicner’s contention that the Social
Law § 367-a categorically prohibits direct reimbursem
Medicaid recipient in all situations. Similar in reaso
Matter of Cole v. Wyman, 40 A.D.2d 1033, 338 N.Y.S.2da 9
Dep’t 1972), in which the state court referred only to
Medicaid regulations in support of its decision to requ
reimbursement to a Medicaid recipient for medical servi

provided and paid for during a period of Medicaid eligi
before the eligibility determination was actually made
New YOrk State court decisions on this issue, see e.g.
Schwartz v. Toia, 68 A.D.2d 890, 414 N.Y.S. 23 (2a D
(reimbursement required pursuant to state law for cost
home care where application for Medicaid was erroneous
Sockin v. Overcash, 45 A.D.2d 717, 356 N.Y.S.2d 329 (2
1974) (reimbursement required under state law and "

interests of justice" where two-and-a-half years elaps
a prior Medicaid application which was lost by the lo
and a subsequent eligibility determination).

826, 430 N.Y.S.2d 50, 407 N.E.2d “1346 (1980). Cf. Harris _y.

McRae, 448 U.S. 297, 311 n. 16 (1980); Beal v. Doe, 432 U.S. 438,
447 n.15 (1977). Therefore, even if the Court of Appeals’
interpretation of Section 367-a of the Social Services Law should
have the effect of conferring greater benefits to Mrs. Krieger
than federal law may require, it does not implicate federal
rights or duties, but rather only dictates that such payments are
not federally reimbursable.

Thus, the Commissioner cannot succeed in invoking this
Court’s jurisdiction Simply by claiming that federal law
prohibits direct reimbursement to a Medicaid recipient where it
1s clear that state law, independent and exclusive of federal
law, mandates direct reimbursement to the Medicaid recipient

under the facts of this case. Michigan v. Long, 463 U.S. at

1041-1042; see O’Brien v. Skinner, 414 U.S. 524, 531 (1974); see

also Agins Vv. Tiburon, 447 U.S. 255, 259 n.6 (1980).

Accordingly, the presence of an independent and adequate state

law ground supporting the judgment of the New York court compels

the denial of the petition for certiorari.

III. CERTIORARI TO REVIEW THE EFFECT OF THE
ADMINISTRATIVE PROCEDURE ACT ON THE WEIGHT
ATTRIBUTED TO AN UNPUBLISHED AGENCY LETTER IS
INAPPROPRIATE IN THIS CASE BECAUSE THE STATE
COURT DECISION ON THAT ISSUE IS SUPPORTED BY AN
INDEPENDENT AND ADEQUATE FEDERAL LAW GROUND,
NOT CONTESTED BY PETITIONER HERE, TO WIT THAT
THE PUBLICATION REQUIREMENTS IN THE FREEDOM OF
INFORMATION ACT DEPRIVE THE UNPUBLISHED LETTER
ON WHICH PETITIONER RELIES OF ANY FORCE OR
EFFECT IN DETERMINING THE BENEFITS DUE
RESPONDENT.

Petitioner relied in the state courts on an unpublished
letter from the Regional Medicaid Director of the Department of
Health and Human Services ("HHS") which interprets the Medicaid
statute to withhold reimbursement from persons’ such as Mrs.
Krieger who paid their bills promptly.19°

The court below properly refused to give full farce and
effect to the agency interpretation on two independent grounds,
only one of which -- the Administrative Procedure ct -- is
challenged by the petitioner in this Court. First, the state
court concluded that the HHS letter announced a substantive rule
prohibiting reimbursement in the circumstances of this case, and
therefore could only be binding if it were promulgated in
accordance with the notice and comment rulemaking requirements of
the Administrative Procedure Act ("APA"), 5 U.S.C. § 553 19
Because the letter rule was never promulgated pursuant to the
APA, the New York Court of Appeals found that the HHS letter is

of no force and effect. Matter of Krieger v. Krauskopf, O N.Y.2d

637, 518 N.Y¥.S.2d 957, 512 N.E.2d 540 (1987), affirming, Matter

of Krieger v. Krauskopf, 121 A.D.2d 448, 503 N.Y.S.2d 418 (2d

Dep’t 1986). See Buschmann v. Schweiker, 676 F.2d 352, 355-356
p

(9th Cir. 1982); Carter v. Blum, 493 F. Supp. 368, 372 (S.D.N.Y.

1980).

10 It is undisputed that the HHS letter was never published in
the Federal Register.

In the alternative, and assuming arguendo as petitioner
argues here that the HHS letter announced an interpretive rule,
the New York Court of Appeals found that HHS’ failure to publish
the rule in the Federal Register, as required by the Freedom of
Information Act~("FOIA") of all interpretive rules adversely
affecting citizens’ rights, precludes the enforcement of the
interpretive rule against Mrs. Krieger inasmuch as the rule
clearly would have adversely affected her.1i

Petitioner seeks review of the state court’s treatment of
the unpublished agency letter only with respect to the New York
Court of Appeals’ interpretation of the Administrative Procedure
Act, to withhold binding effect from the Regional Director’s
unpublished letter. Petitioner does not contest the New York
court’s identical "no binding effect" conclusion based on the
Freedom of Information Act. This Court does not sit to review
dicta in state court decisions that reach correct results on
unchallenged, alternative and wholly adequate and independent
grounds. Accordingly, because the New York Court of Appeals
correctly found the letter of no lecal force and effect under
the unimpéached and unappealed FOIA ground, that court’s obiter
dicta with regard to the APA issue is'‘irrelevant to the outcome

of the case and provides no basis for review by the Court.

11 gee 5 U.S.C. § 552(a)(1)(D) (1977): Morton v. Ruiz, 415 U.S.
199, 233 (1974). The Freedom of Information Act ("FOIA") requires
the publication in the Federal Register of "substantive rules

of general applicability adopted as authorized by law, and
statements of general policy or interpretations of general
applicability formulated and adopted by the agency..." 5
U.S.C. § 552(a)(1)(D). The Act further states that a person may
not be adversely affected in any manner by matter required to be
published in the Federal Register and not so published. 5 U.S.C.
§ 552(a)(1). Anderson v. Butz, 550 F.2d 459, 463 (9th Cir.
1977); see Donovan v. Wollaston Alloys, Inc., 695 F.2d l, 9
(lst Cir. 1982). The state court in this case concluded that
Mrs. Krieger would be adversely affected by the provision
contained in the HHS letter, that she had no actual or timely
notice of that provision, and therefore, absent publication, the
alleged rule could have no force or effect with respect to her.

- 15 -

IV. THIS COURT SHOULD DECLINE TO EXERCISE ITS
JURISDICTION TO REVIEW THE NEW YORK COURT OF
APPEALS DECISION BECAUSE THAT COURT’S JUDGMENT
CREATES NO CONFLICT AMONG THE FEDERAL CIRCUIT
COURTS OR OTHER STATE COURTS, RAISES NO
IMPORTANT OR SIGNIFICANT FEDERAL LAW QUESTIONS,
AND WAS CORRECTLY DECIDED.

The federal law dicta in the New York Court of Appeals’
decision supporting the direct reimbursement to Mrs. Krieger for
medical bills paid in the three months prior to the month in
which she applied for Medicaid does not raise a novel or
substantial federal question worthy of the exercise of this
Court’s jurisdiction. Significantly, petitioner does not allege
that there are state or federal court decisions which concern
this issue, or which conflict with the New York court’s decision,
because there are none reported. Nor does petitioner allege a
substantial adverse financial or other impact on the
administration of the State’s Medicaid plan as a result of this
litigation. Nor can petitioner substantiate his assertion that
all states will be required to~ follow the New York Court of
Appeal’s decision with respect to the New York State Medicaid
plan if the decision below is upheld, because the state court
decision has no impact on the interpretation of any other state
Medicaid plan. Petitioner’s utter failure to identify or
substantiate any far-reaching consequences of the New York
Court’s decision belies its bald assertion that the questions

presented merit review by this Court. Furthermore, as explained

below, the New York Court of Appeals’ decision is correct.

Accordingly, certiorari should be denied.

A. MEDICAID ELIGIBLE CLAIMANTS WHO PROMPTLY
PAID THEIR BILLS ARE ENTITLED TO MEDICAID
COVERAGE OF THE SAME AMOUNT, DURATION AND
SCOPE FOR THE THREE MONTHS PRIOR TO THEIR
APPLICATION AS THOSE CLAIMANTS WHO FAIL TO
PAY THEIR BILLS.

Petitioner’s refusal to direct the local agency to
reimburse Mrs. Krieger for medical expenses incurred during the
three months prior to the month of her Medicaid application
violates the mandatory requirements of the federal Medicaid
program. Under 42 U.S.C. § 1396a(a)(34) a State plan for
Medicaid must provide:

that in the case of any individual who has_ been

determined tc be eligible for medical assistance

under the plan, such assistance will be made

available to him for care and services included

under the plan and furnished in or after the

third month before the month in which he made

application . ._.+ oy
42 U.S.C § 1396a(a) (34). By its terms, 42 U.S.C. § 1396a(a) (34)
requires assistance to persons, such as Mrs. Krieger, who have
been determined to be eligible for medical assistance and to whom
care and services were furnished. The statute provides no basis
for excepting care and services solely on the ground that the
eligible claimant chose to pay bills promptly rather than face
the potential loss of necessary care. By adding the condition
that bills be unpaid, petitioner has interposed an illegal and
unauthorized condition of eligibility. See generally King v.
Snith, 392 U.S. 309, 333 n.34 (1968).

Indeed the legislative history of 42 U.S.C. § 1396a(a) (34)
demonstrates that Congress was particularly concerned with the
practical problems Medicaid eligible persons have in filing
applications before they receive treatment. Prior to 1972,

coverage for the three months prior to application was optional

and only thirty-one states provided such coverage. In making 42

- 17 «=

U.S.C. § 1396a(a) (34) a mandatory part of any State Medicaid
plan, Congress recognized that many Medicaid eligible claimants
"do not apply for assistance until after they have received care,
either because they did not know about Medicaid eligibility
requirements, or because the sudden nature of their illness
prevented their applying." H.R. Rep. No. 92-231, 92d Cong., 2d
Sess. reprinted in [1972] U.S. Code Cong. & Ad. News 4489, 5099.
Because Congress found coverage for these earlier months to be
both “reasonable and desirable," id., it required all states to
provide such coverage. Congress’ express intent that eligibility
not be denied due to a delay in applying for Medicaid is clearly
frustrated by petitioner’s arbitrary rule that penalizes eligible
claimants who paid their bills promptly out of fear of losing
essential medical care.

The singling out of claimants who have paid their bills
likewise violates the Social Security Act’s mandatory
requirement that State plans set forth a single standard for
determining the amount, duration and scope of assistance
within any group of persons eligible for medical assistance.
See 42 U.S.C. §§ 1396a(a)(10)(B), 1396a(a)(10)(C). Similarly,
42 U.S.C. § 1396a(a)(17) requires that state plans’ include
reasonable standards that are comparable for all groups
determining the extent of medical assistance and that are
consistent with the objectives of the Medicaid statute. As set
forth in federal regulations, a State plan:

must provide that the services available to any
individual in the following groups are equal in
amount, duration, and scope for all recipients

within the group:
= Rm ®

(2) A covered medically needy group.

42 C.F.R. § 440.240(b) (1986). This comparability requirement

mendates that Mrs. Krieger receive care in the same amount,

- 18 -

duration and scope as a similarly situated person who has not
paid her bills. See Hodecker v. Blum, 525 F. Supp. 867, 873
(N.D.N.Y. 1981), aff’d, 685 F.2d 424 (2d Cir. 1982). It does not
permit Mrs. Krieger to be penalized for simply paying her bills
on time.

In this case, Mrs. Krieger has been found to be "medically
needy" for the three months prior to her application date. Under
the facts of this case stipulated to below, she is eligible to
receive Medicaid for any month in which she has incurred $19.80
in medical expenses. In fact, Mrs. Krieger’s expenses were in
excess of $19.80 for each of those three months. Had she not
paid her bills, the provider of medical services admittedly would
have been reimbursed. By not reimbursing Mrs. Krieger for the
very same bills petitioner would Save ethenvine paid, petitioner
is denying Mrs. Krieger the same ameunt, duration and scope of
medical assistance provided to persons who are _ identically
situated but who have not paid their bills.

B. AN _ UNPUBLISHED AGENCY LETTER NOT
PROMULGATED IN ACCORDANCE WITH THE NOTICE AND
COMMENT RULEMAKING REQUIREMENTS OF THE
ADMINISTRATIVE PROCEDURE ACT IS OF NO BINDING
FORCE AND EFFECT IN DETERMINING CLAIMANTS’
RIGHTS.

With respect to its Administrative Procedure Act .("APA")
claim, petitioner argued inconsistently that although the HHS
letter is merely an interpretation of the agency’s regulation and
therefore exempt from the notice and comment provisions of the
Administrative Procedure Act, 5 U.S.C. § 553 (1977), it is
nevertheless binding law upon the courts and the parties as an

authoritative interpretation of federal statutory law.12 13 The

12 This argument was raised by petitioner on appeal to the New
York Court of Appeals in a footnote. Petitioner did not raise a
specific objection to the lower state court’s interpretation of
the Freedom of Information Law, 5 U.S.C. § 552, on appeal to the
New York Court of Appeals.

13 A substantive rule is defined as a "legislative type rule .

- 19 -

petitioner misconstrues the decision of the New York court to
create an alleged conflict among the federal circuit courts.
Petitioner characterizes the New York Court of Appeals decision

as holding that interpretive rules must be promulgated as a

regulation pursuant tc the APA in order to be given force and
effect. In fact, the New York Court of Appeals never addressed
the bearing of the APA on interpretive rules because it concluded

in its APA analysis that the HHS letter was a substantive rule.14

Substantive rules clearly and unequivocally fall within the
ambit of the APA notice and comment provision, 5 U.S.C. § 553,
and will not "be afforded the ‘force and effect of law’ if not
promulgated pursuant to the statutory procedural minimum found in

th[e] [Administrative Procedure] Act." Chrysler Corp. v. Brown,

441 v8. aes, 223. (2979): On this point, there is no
disagreement among the petitioner, the respondent, the New York

Court of Appeals, and the federal courts. See e.g., St. Mary’s

Hospital of Troy v. Blue Cross & Blue Shield Ass’n, 788 F.2d 888,

891 (2d Cir. 1986); Linoz v. Heckler, 800 F.2d 871, 877 (9th

Cie 2966); Suita v. Bilier, 665 -F.20 172, 179 n.7 (7th Cir.

1981); Cerro Metal Products v. Marshall, 620 F.2d 964, 981-982

(3d Cir. 1980); Columbus Community Hospital, Inc. v. Califano,

614 F.2a@ 281, i187 (Sth Cir. 1980); Anderson v. Butz, 550 F.2d

459, 463 (9th Cir. 1977).

Nor is there a conflict between the New York Court of

- - aS one ‘affecting individual rights and obligations.’"
Chrysler Corp. v. Brown, 441 U.S. 281, 302 (1979), quoting Morton
v. Ruiz, 415 U.S. 199, 236 (1974), which purports to be binding
on the agency, Batterton v. Marshall, 648 F.2d 694, 702 (D.C.
Cir. 1980), and which has "the force and effect of law."
Batterton v. Francis, 432 U.S. 416, 425 n.9 (1977); National
Nutritional Foods Ass’n. v. Weinberger, 512 F.2d 688, 698 n.8 (2d
Cir.), cert. denied, 423 U.S. 827 (1975). Therefore, if the HHS
letter is read as binding agency policy, it meets the description
of a substantive rule set out by this Court and the lower courts.

14 The HHS letter purports to interpret a provision in the HHS
Medicaid Manual. A section of this Medicaid Manual is annexed
to the Petition for a Writ of Certiorari as Appendix "F" in an
attempt to make it part of the record. The HHS Medicaid Manual
was not introduced and is not part of the record below. It
therefore should not be considered at this time.

- 20 -

Appeals and the federal circuits with respect to the deference
accorded to administrative interpretations. If the HHS letter is -
only an interpretive rule -- one "which merely clarif[{ies] or

explain{s] existing law or regulations," Powderly v. Schweiker,

704 F.2d 1092, 1098 (9th Cir. 1983) -- it is by definition
"non-binding," Batterton v. Marshall, 648 F.2d 694, 702 (D.C.Cir.

1980), and is not entitled to the type of judicial deference
accorded regulations promulgated pursuant to the notice and

comment provisions of the APA. See Schweiker v. Hansen, 450 U.S.

785, 789-90 (1981); Liegl v. Webb, 802 F.2d 623 (2d Cir. 1986)
(The Medical Assistance Manual merely provides operational
assistance without intending to supplement regulations and is not
entitled to particular deference. )

Varying degrees cf deference are accorded to administrative
interpretations based on a number of factors, most notably the
consistency of the agency’s position. Batterton v. Francis, 432
U.S. 416, 425 n. 9 (1977)3 General Electric v. Gilbert, 429 U.S.
125, 141-143 (1976). As the record below establishes, petitioner
decidedly has not consistently enforced the administrative
interpretation it invokes in this court. For example,
reimbursement was made to the respondent in this very case for
prescription drugs which petitioner claimed in the Court of
Appeals, relying on the Regional Director’s letter, cannot be the
subject of reimbursement. See supra note 9. Administrative
guidelines are properly discounted where as here they conflict
with earlier pronouncements of the agency. General Electric v.
Gilbert, 429 U.S. at 143; United Housing Foundation, Inc. v.
Forman, 421 U.S. 837, 858 n. 25 (1975); Morton v. Ruiz, 415 U.S.

199, 237 (1974); Espinoza v. Farah Mfg. Co., 414 U.S. 86, 93-94
(1973).

The petitioner cannot have it both ways. If the HHS letter

states a substantive rule, it is void for failure to comply with

- 21 -

the notice and comment provisions of the Administrative Procedure
act, 5 U.is.E. $e S53. If, on the other hand, it is an
interpretive rule, it lacks binding authority, and is not
entitled to slavish deference by the reviewing court. The New
York Court of Appeals decision is consistent with the federal

circuits on these points. Certiorari is unwarranted.

- 22 -

CONCLUSION

For the reasons set forth above, the writ of certiorari

should be denied.

Respectfully submitted,

KALMAN FINKEL, ESQ.
Attorney-in-Charge

Civil Division

The Legal Aid Society

11 Park Place - Room 1800
New York, New York 10007
(212) 406-0750

JOHN E. KIRKLIN, ESQ.

Director of Litigation

Civil Appeals & Law Reform Unit
JANET SABEL, Of Counsel

The Legal Aid Society

11 Park Place - Room 1805

New York, New York 10007

(212) 406-0745

DA Mar wie
4

AN MANGONES,

ttorney-in-Charge
Staten Island Neighborhood Office
LESTER HELFMAN, Of Counsel
The Legal Aid Society
25 Hyatt Street
Staten Island, New York 10301
(718) 237-6677

Dated: New York, New York
November 20, 1987

- 23-

---

Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385019_2403%3A2. Public record. Not legal advice.