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Lawrie v. Dept. of Public Aid

OPINION FILED SEPTEMBER 19, 1978.

CHARLES LAWRIE, APPELLEE,

v.

THE DEPARTMENT OF PUBLIC AID, APPELLANT.



Appeal from the Appellate Court for the First District; heard in that court on appeal from the Circuit Court of Cook County, the Hon. Arthur L. Dunne, Judge, presiding.

MR. JUSTICE MORAN DELIVERED THE OPINION OF THE COURT:

Plaintiff, Charles Lawrie, is a mentally retarded adult who has resided at Beverly Farm Foundation, Inc., in Madison County, since 1959, when he was 11 years old. Beverly Farm, a not-for-profit corporation, operates a home for the mentally retarded and is licensed by the Department of Public Health.

In 1972, plaintiff applied for public assistance from the Department of Public Aid (Department) under the Department's Aid to the Aged, Blind or Disabled program (AABD) (Ill. Rev. Stat. 1971, ch. 23, par. 3-1 et seq.). Aside from contributions from his parents, plaintiff has no means of support. Since 1969, parents of mentally retarded persons over the age of 21 are not legally responsible for such person's support. Ill. Rev. Stat. 1969, ch. 23, par. 2-11.

Plaintiff's application for aid was denied by the Madison County Department of Public Aid because Beverly Farm refused to enter into a provider agreement with the Department, pursuant to chapter 5550, topic 5556.3, of the Department's Categorical Assistance Manual (now section 1105 of the Department's AABD Manual). This regulation required, among other things, that Beverly accept the Department's rate of payment as payment in full for the services rendered.

Plaintiff appealed the denial of his application by notice to the Department. At the time plaintiff filed his application, the monthly rate charged by Beverly Farm (exclusive of clothing and medical supplies) was approximately $258. At the hearing on plaintiff's appeal, plaintiff's mother testified that the rate had risen to approximately $300 per month and was expected to increase another $50 per month. The record indicates that if Beverly entered into an agreement with the Department, the level of assistance available to the plaintiff could range from $212 per month to $305 per month, depending on the nature of care required and the program and services provided. Plaintiff's parents sought to supplement the Department's level of assistance with an amount equal to the difference between Beverly's monthly rate and the amount available from the Department.

At the conclusion of the hearing, the Department's hearing officer found that, inasmuch as Beverly refused to accept the Department's rate of payment as payment in full, the maximum assistance available to plaintiff was $100 per month, the Department's basic rate for room and board in a non-approved institution. The hearing officer further found that, pursuant to section 3-5 of the Illinois Public Aid Code (Code) (Ill. Rev. Stat. 1971, ch. 23, par. 3-5), any amount paid to Beverly Farm by plaintiff's parents would correspondingly reduce the amount of aid available under the Code.

Plaintiff filed a complaint under the Administrative Review Act (Ill. Rev. Stat. 1975, ch. 110, par. 264 et seq.) challenging the Department's regulation and policy prohibiting supplementation. The circuit court of Cook County reversed the decision of the Department, holding the Department's "payment in full" regulation and the policy prohibiting supplementation void as not authorized by section 3-5 of the Code and violative of the equal protection clauses of the United States and Illinois constitutions. The Department appealed to the appellate court which, with one justice dissenting, affirmed the circuit court (46 Ill. App.3d 23). We granted the Department leave to appeal.

The Department here contends that its policy and regulation are not only consistent with the provisions of the Code but are, in fact, mandated by statute. It also points to a certain Federal regulation which requires that, as a condition to the State's continued receipt of Federal funds, all providers of medical services must accept the State's payment as payment in full.

Plaintiff, on the other hand, asserts that both the Department's regulation and its policy against supplementation are neither authorized by the Code nor required by Federal regulation.

Initially, we note that the parties disagree as to which public assistance program is here involved. The Department contends that the issues are controlled by those rules and regulations promulgated under the Federal Medical Assistance Program (Medicaid) (42 U.S.C.A. sec. 1396 et seq.). Plaintiff, on the other hand, contends that certain statutory provisions under the State's AABD program are controlling (Ill. Rev. Stat. 1971, ch. 23, par. 3-1 et seq.). Confusion apparently exists because, according to plaintiff, no final determination has yet been made as to the nature or degree of care actually required by the plaintiff's disability.

Review of the various applicable statutes and regulations indicates that assistance is available to individuals in need of institutional care either under the AABD program or the Medicaid program. (See Ill. Rev. Stat. 1971, ch. 23, pars. 3-2, 5-5; Department of Public Aid, Rules & Regulations, Rules 3.51, 4.01, 4.14, hereinafter cited as DPA Rules & Regs.) The assistance available thereunder is dependent upon the nature and degree of care required by the individual and by the individual's available income and resources as set forth in the Department's standards and regulations.

Under the State's AABD program, private, licensed sheltered-care facilities (SCF) may provide basic maintenance services for which reimbursement is made according to a rate schedule promulgated by the Department. (DPA Rules & Regs., Rule 3.51, Attachments III and IV.) Qualified individuals, who, by Department regulations and standards, require a greater degree of care than that available in a licensed SCF are eligible for public assistance under the Medicaid program. (DPA Rules & Regs., Rule 4.14, Attachment I.) Only licensed skilled nursing facilities (SNF) and intermediate care facilities (ICF) may provide services for individuals under the Medicaid program. The Department employs different rate schedules for that program. (DPA Rules & Regs., Rule 4.14, Attachment II.) The record indicates that Beverly Farm is licensed both as an ICF and an SCF. As will be discussed, we believe that, under either program, there is statutory authority for the Department's "payment in full" policy and for its prohibition against supplementation.

Medicaid and AABD are State-administered Federal programs designed to alleviate hardships to individuals with specific needs and limited financial resources. Federal matching funds are available under either program to States which comply with certain minimum Federal requirements. Illinois, by statute, has elected to receive these matching funds. (Ill. Rev. Stat. 1971, ch. 23, par. 12-4.5.) Because of the finiteness ...


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