Washington State Dept. of Social and Health Servs. v. Guardianship Estate of Keffeler, 537 U.S. 371 (2003)

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OCTOBER TERM, 2002

Syllabus

WASHINGTON STATE DEPARTMENT OF SOCIAL AND HEALTH SERVICES et al. v. GUARDIANSHIP ESTATE OF KEFFELER et al.

certiorari to the supreme court of washington

No. 01-1420. Argued December 3, 2002—Decided February 25, 2003

Although Old-Age, Survivors, and Disability Insurance (OASDI) benefits under Title II of the Social Security Act, 42 U. S. C. 401 et seq., and Supplemental Security Income (SSI) benefits under Title XVI, 1381 et seq., are generally paid directly to the beneficiary, the Social Security Administration may distribute them to another individual or entity as the beneficiary's " 'representative payee,' " 405(j)(1)(A), 1383(a)(2)(A)(ii)(I). Regulations provide, inter alia, that social service agencies and custodial institutions may serve as representative payees, but follow a parent, legal guardian, or relative in the order of preference for appointment to that position. E. g., 20 CFR 404.2021(b)(7), 416.621(b)(7). Such a payee may expend funds "only for the use and benefit of the beneficiary," in a way the payee determines "to be in the [beneficiary's] best interests." 404.2035(a), 416.635(a). Payments made for "current maintenance" are "for the use and benefit of the beneficiary," and "current maintenance" includes "cost[s] incurred in obtaining food, shelter, clothing, medical care, and personal comfort items," 404.2040(a), 416.640(a). A representative payee "may not be required to use benefit payments to satisfy a [beneficiary's] debt" that arose before the period the benefit payments are certified to cover, but a payee may discharge such a debt if the beneficiary's "current and reasonably foreseeable needs" are met and it is in the beneficiary's interest to do so, 404.2040(d), 416.640(d).

Washington State, through petitioner Department of Social and Health Services, provides foster care to certain children removed from their parents' custody, and it also receives and manages Social Security benefits as representative payee for many of those children. Pursuant to its regulation requiring that public benefits for a child, including SSI or OASDI benefits, be used on behalf of the child to help pay for the child's foster care costs, the department generally credits the Social Security benefits it receives to a special account for the beneficiary child, and debits the account to pay foster care providers. Respondents, who include such beneficiary children, filed this class action in state court, alleging, among other things, that the department's use of their OASDI or SSI benefits to reimburse itself for the foster care costs violated 42

371

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