Anthony v. Poteet Housing Authority , 306 F. App'x 98 ( 2009 )

REVISED JANUARY 12, 2009
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT United States Court of Appeals
Fifth Circuit
FILED
January 7, 2009
No. 08-50385
Charles R. Fulbruge III
Clerk
BRENDA ANTHONY
Plaintiff - Appellant
v.
POTEET HOUSING AUTHORITY
Defendant - Appellee
Appeal from the United States District Court
for the Western District of Texas
USDC No. 5:06-CV-1009
Before JONES, Chief Judge, JOLLY, Circuit Judge, and CARDONE, District
Judge.*
KATHLEEN CARDONE, District Judge: **
Brenda Anthony seeks a refund of rent payments paid to her landlord
Poteet Housing Authority on the basis of 24 C.F.R. § 5.609(c)(16). The
magistrate judge granted summary judgment in favor of Defendant. For the
*
United States District Judge, Western District of Texas, sitting by designation.
**
Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should
not be published and is not precedent except under the limited circumstances set forth in
5TH CIR. R. 47.5.4.
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reasons set forth below, we affirm.
BACKGROUND
Appellant Brenda Anthony (“Anthony”) qualifies for and lives in low-rent
public housing owned and managed by Appellee Poteet Housing Authority
(“PHA”) in Atascosa County, Texas. Anthony has lived in the PHA apartment
with her three sons since 2000. Anthony’s oldest son, Gilbert Anthony
(“Gilbert”), is twenty-three years old and is severely disabled as a result of
multiple sclerosis.1 Gilbert was disabled throughout the time that he and
Anthony lived in the apartment.
Gilbert qualifies for personal-care attendants, as well as other services,
through the State of Texas Community Based Alternatives Program (“CBA”),
under which state and federal money is used to provide in-home care for
individuals as a cost-effective alternative to institutional placement. CBA is
funded through a Medicaid waiver which permits Texas to provide services that
are unavailable under the standard Medicaid program. As required by federal
regulations, Texas delegates responsibility for its Medicaid program to a single
agency, the Department of Health and Human Services.
CBA services had been provided by private companies under contract with
the State of Texas Department of Aging and Disability Services (“DADS”). On
January 1, 2007, STAR+PLUS, a pilot program, replaced DADS in Atascosa
County. Participation in STAR+PLUS is mandatory for individuals seeking to
receive CBA services in that county.
STAR+PLUS is administered entirely though private health maintenance
organizations (“HMO”) which are approved by the Texas Department of Health
1
Gilbert resided with Anthony in the PHA apartment until approximately March 1,
2008, when Gilbert was hospitalized.
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and Human Services for Medicaid funding. Those HMO’s develop an
individualized plan of care with each CBA participant and his or her family and
authorize services pursuant to that plan. The plan of care describes the services
and equipment to be provided, and sets out the cost of the care. Each plan must
be approved by the State. Additionally, a reassessment of the plan is performed
annually.
Gilbert is bed-bound and requires assistance for tasks such as bathing,
meal preparation and feeding, changing diapers, grooming, dressing, exercising,
and taking medications. Gilbert began participating in the CBA Program when
he turned 21 years of age, on November 22, 2004, and continued to participate
after STAR+PLUS was implemented. Each of Gilbert’s annual CBA plans
provided for personal-assistance services. Gilbert first received services from
MED TEAM, Inc. (“MED TEAM”). Beginning April 12, 2007, Gilbert’s provider
was Saldivar Primary Home Care SA (“Saldivar”). MED TEAM and Saldivar are
both for-profit corporations whose sources of revenue include private insurance,
Medicare, and direct payments.
In November 2004, Anthony began employment with MED TEAM as a
personal-care attendant. As part of her employment, she provided CBA services
to Gilbert. However, MED TEAM was not required to assign Anthony to care for
Gilbert. Additionally, Anthony was required to serve as a backup for other
personal-care attendants and to care for other MED TEAM clients. Anthony
earned approximately $13,156.00 annually as an employee of MED TEAM, and
these wages were subject to federal income tax, which Anthony paid. On April
12, 2007, Anthony ended her employment with MED TEAM because MED
TEAM decided that it no longer wanted to provide CBA services to Gilbert.
Beginning April 26, 2007, Anthony, along with another individual, was employed
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by Saldivar as personal care attendants for Gilbert. Saldivar contracts with
Superior HealthPlan, Inc. (“Superior”) to provide services to CBA/STAR+PLUS
qualified individuals, including Gilbert. Saldivar receives reimbursement from
Superior, which in turn receives reimbursements from the State of Texas and
the federal government through Medicaid. As with her employment at MED
TEAM, Anthony’s wages from Saldivar were subject to federal income tax, which
Anthony paid. As with the MED TEAM arrangement, the CBA/STAR+PLUS
Program allows a family member to be assigned as the home health provider for
the participant, though there is no requirement that the provider be a family
member. Also with the MED TEAM arrangement, Anthony is subject to being
called as a backup for other home health providers to care for other participants.
Finally, as with MED TEAM before it, Saldivar has the authority and discretion
to assign any home health provider to care for Gilbert, though it chose to
accommodate Gilbert by hiring his mother.
Tenants of public housing, such as Anthony, pay either income-based or
flat rent. Because Anthony elected to pay income-based rent, PHA calculates
Anthony’s rent according to a formula established by Congress and the Secretary
of Department of Housing and Urban Development (“HUD”). The formula
provides that tenants must pay the greater of thirty percent of their monthly-
adjusted income; ten percent of their gross monthly income; or a minimum rent
set by each public housing authority. See 42 U.S.C. § 1437a(a)(1)-(3). PHA
considered Anthony’s wages from MED TEAM and Saldivar as income for the
purposes of determining her rent, with the exception of income excluded under
the earned income disregard rule, which is not at issue in this case. Anthony
contends that PHA miscalculated her rent because MED TEAM and Saldivar
wages qualify for an income exclusion under 24 C.F.R. § 5.609(c)(16). Anthony
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alleges that the miscalculation resulted in overpaid rent in the amount of
$5,893.2
On November 16, 2006, Anthony sued PHA in the Western District of
Texas. The parties consented to have a Magistrate Judge conduct the
proceedings, with appeal directly to this Court. After the lawsuit was filed, PHA
requested that HUD issue an opinion on whether PHA’s calculation of Anthony’s
rent calculation violates 24 C.F.R. § 5.609(c)(16). HUD’s assistant general
counsel responded with a letter stating that its regulation did not apply to
Anthony’s earnings. On March 20, 2008, Magistrate Judge John W. Primomo
granted PHA’s Motion for Summary Judgment and denied Anthony’s Motion for
Summary Judgment. This timely appeal followed.
DISCUSSION
A. Standard of Review
When the parties have consented to the exercise of jurisdiction by a
magistrate judge, this Court reviews the magistrate judge’s grant of summary
judgment de novo. Cavalier v. Caddo Parish School Bd., 403 F.3d 246, 249-50
(5th Cir. 2005). The Court applies the same standard as the trial court, viewing
the facts in the light most favorable to the nonmovant. Hampton Co. Nat. Sur.,
LLC v. Tunica County, Miss., 543 F.3d 221, 224 (5th Cir. 2008). Summary
judgment is appropriate “when no issue of material fact exists and the moving
party is entitled to judgment as a matter of law.” Id. (citing Mowbray v.
Cameron County, Tex., 274 F.3d 269, 278-79 (5th Cir. 2001)).
2
Anthony states in her Reply Brief that since the start of this litigation, Gilbert has
returned home, and Anthony is once again paying increased rent.
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B. Interpreting the Regulation
Because the plain language of the regulation favors PHA’s position, the
Court need not consider the HUD letter in construing the regulation. When
interpreting a regulation, this Court “look[s] first to the regulation's plain
language.” Anthony v. United States, 520 F.3d 374, 380 (5th Cir. 2008) (citing
Lara v. Cinemark, U.S.A., Inc., 207 F.3d 783, 787 (5th Cir. 2000)).3 Additionally,
a “regulation should be interpreted in a manner that effectuates its central
purposes.” Id. (quoting Jochum v. Pico Credit Corp. of Westbank, Inc., 730 F.2d
1041, 1047 (5th Cir. 1984)). Further, “courts should not interpret an agency
regulation to thwart the statutory mandate it was designed to implement.” Id.
(quoting Jochum, 730 F.2d at 1047).
The dispute in the instant case centers on whether Anthony's wages are
(1) "[a]mounts paid by a State agency to a family," and (2) intended "to offset the
cost of services and equipment needed to keep the developmentally disabled
family member at home[.]" 24 C.F.R. § 5.609(c)(16).
The regulation does not specifically address whether funds paid by a state
to a family member after passing through a private entity are excluded from the
term “annual income.” Additionally, all state-funded in-home attendant- care
services in Texas are provided by private intermediaries, and Texas does not
provide any amounts directly to families to offset costs incurred to keep a
disabled family member at home. Accordingly, this Court cannot determine how
allowing pass-through funds would affect the regulation’s central purposes.
However, assuming that the regulation allows for pass-through funds to be
3
“We have consistently held that a regulation should be construed to give effect to
the natural and plain meaning of its words.” S.D. ex rel. Dickson v. Hood, 391 F.3d 581,
594-95 (5th Cir. 2004) (citations omitted).
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excluded from annual income, the regulation is clear regarding “offset[ting] the
cost of services and equipment needed to keep the developmentally disabled
family member at home[.]” One must incur costs before they can be offset. In the
instant case, Anthony has incurred no costs which must be offset with state
funds. The record demonstrates that MED TEAM and Saldivar paid Anthony
to provide Gilbert with in-home care with money partially provided by the state.
However, the fact that Anthony’s employment income coincides with state funds
that are set aside for her son’s care does not make that income a form of
reimbursement.
Anthony argues that “[a]ttendant services provided by the CBA individual
services plan for Gilbert have a cost. They are not free.” However, for Anthony,
they are free. She has no out-of-pocket expenses – “costs” – that must be
reimbursed or “offset” by the state. Anthony’s argument, that she “is paid to
compensate [offset] for the cost,” only makes sense if the regulation is read to
exclude payments to offset the State’s costs, as the State is ultimately the party
paying for Gilbert’s attendant home care. Anthony’s reading, therefore, has no
support in the language of the regulation.
Anthony further argues that another exclusion – 24 C.F.R. § 5.609(c)(4) –
would make § 5.609(c)(16) redundant were the latter interpreted to require
direct reimbursement of Anthony’s costs. Section 5.609(c) excludes from annual
income “[a]mounts received by the family that are specifically for, or in
reimbursement of, the cost of medical expenses for any family member.” 24
C.F.R. § 5.609(c)(4). The term “medical expenses” includes attendant care. See
PUBLIC HOUSING OCCUPANCY GUIDEBOOK, 135 (2003).
However, medical expenses specifically exclude expenses paid by
insurance, and Gilbert’s STAR+PLUS funds are paid by Medicaid. See 24 C.F.R.
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§ 5.603. In addition, § 5.609(c)(16) provides for more than just “medical
expenses,” as it covers any “cost” incurred by a family with a disabled member
for “services and equipment needed to keep the developmentally disabled family
member at home[.]” Id. § 5.609(c)(16). While these two exclusions may
potentially overlap, each exclusion addresses different costs or expenses incurred
by a family with a disabled member. Accordingly, the exclusions are not
redundant.
In conclusion, even if § 5.609(c)(16) is unclear regarding whether pass-
through funds may be excluded from annual income, the regulation’s plain
language does not support excluding wages designed to offset costs exclusively
incurred by the state. Under the regulation, Anthony’s wages earned as
Gilbert’s personal-care attendant are not to be excluded from PHA’s calculation
of her rent.
CONCLUSION
For the reasons stated, the judgment of the magistrate court is
AFFIRMED.
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