The opinion of the court was delivered by: STANLEY S. BROTMAN
The present case is before the court on appeal from the decision of the Secretary of Health and Human Services ("Secretary") to discontinue Plaintiff's Supplemental Security Benefits and to collect an overpayment which resulted from Plaintiff's ownership of excess resources. For the reasons set forth below, this court affirms the Secretary's decision.
The Plaintiff, Shirley Woods ("Plaintiff"), applied for Supplemental Security Income ("SSI") benefits on October 14, 1987. She qualified for benefits as a result of combined disabilities including visual problems caused by glaucoma, borderline intelligence and a generalized anxiety disorder.
In December of 1989, upon field contact from the Social Security Administration ("SSA"), the Plaintiff informed the agency that she owned three life insurance policies
with a total cash value of $ 5,415.01, and two annuities with cash values totalling $ 13,179.25. Once Plaintiff disclosed the existence of the life insurance policies and the annuities, SSA determined that the resources available to Plaintiff from these policies and annuities exceeded the resource levels permitted by the SSI program. SSA subsequently discontinued benefits in March of 1990, and processed a non-fraudulent overpayment, which relieved the Plaintiff of liability for causing the overpayment, but still required repayment of the money received during the period of ineligibility.
Upon reconsideration, SSA upheld the overpayment and the decision to terminate benefits due to excess resources. Plaintiff appealed and a hearing was held before an Administrative Law Judge ("ALJ"), on August 28, 1990. The ALJ held that the cash surrender values of the life insurance policies and the annuities exceeded the regulatory limits for the SSI program, as set by 20 C.F.R. §§ 416.1201(a), 416.1230(a).
Pursuant to 42 U.S.C.A. §§ 405(g) and 1383(c)(3), this court's role in reviewing the decision of the Secretary is to determine whether the record, as a whole, contains substantial evidence to support the Secretary's findings. "Substantial evidence" has been defined as that evidence which "a reasonable mind might accept as adequate to support a conclusion". Pierce v. Underwood, 487 U.S. 552, 565, 101 L. Ed. 2d 490, 108 S. Ct. 2541 (1988) (quoting Consolidated Edison Co. v. N.L.R.B., 305 U.S. 197, 229, 83 L. Ed. 126, 59 S. Ct. 206 (1938)). Where evidence is susceptible to more than one interpretation, the court must give deference to the agency interpretation unless it is arbitrary and capricious or an abuse of the agency's discretion. Fishburn v. Gardner, 452 F.2d 1004, 1005 (3d Cir. 1971).
1. Life Insurance Policies
There is no question that the resources Plaintiff was entitled to from her insurance policies exceeded the resource limitations established by the SSI program. 42 U.S.C.A. § 1382b(a), provides that the cash surrender value of insurance policies must be considered as a resource unless the total face value of all policies is $ 1,500.00 or less. According to her testimony, Plaintiff possessed insurance policies having a total face value of $ 20,000 when she initially applied and qualified for benefits. Plaintiff's testimony indicated that she had taken out these policies in 1968 with the money she received from her husband's death benefits. May 1, 1991 Hearing Tr. p. 4.
The effective resource limitation for cash and liquid assets was $ 1,800 during 1987; $ 1,900 during 1988; and $ 2,000 after 1989. See 20 C.F.R. § 416.1205(c). Life insurance policies are defined as liquid resources by 20 C.F.R. § 416.1201(b)
because they can easily be converted into cash within the prescribed period of twenty (20) working days.
In December of 1989, when Plaintiff first reported these policies to the agency, the cash surrender value of her policies was $ 5,415.01. See SSA Exhibit B-11. This value exceeded the resource limitations in effect for 1989. Based on the ...