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[Added: October 2001]
On September 11, 2001, the Superior Court for Augusta Georgia, in a significant judicial review decision, overturned an administrative hearing that upheld the State agency's uniform policy against retroactive payments. The basic argument for retroactive adoption assistance payments is that the existence of extenuating circumstances prevented the adoptive family from applying for and receiving adoption assistance from the earliest date of eligibility. The earliest date of eligibility is most often the date the child was placed for adoption.
A number of agencies have opposed retroactive payments, arguing that existing federal policy, while allowing such benefits, leaves the final decision to the individual states. Georgia's policy, like that of several states, limited retroactive payments to the date of the most recent date of application, which was usually years after the adoption was finalized. In William And Melody Sanders v. Georgia Department Of Human Resources, the Superior Court determined that the uniform policy against retroactive adoption assistance set forth in the agency's policy manual "does not allow a fair hearing for petitioners as required by the above federal regulations, nor does it provide an adequate remedy under the factual circumstances of this case."
Alsdorf v. the Nevada Department of Human Resources
The judicial review ruling by the Augusta Superior Court was similar to that rendered by the district court in the case of Alsdorf v. the Nevada Department of Human Resources. In that July 2000 decision, the District court determined that the state's policy which automatically denied adoptive parents' request for retroactive adoption assistance payments constituted an abuse of it's discretion and remanded the case back to an administrative hearing to be determined on its individual merits. As in Sanders, the Judge in the Alsdorf case ruled that adoptive parents are entitled to a hearing on requests for retroactive adoption assistance payments based on the specific facts of the their case. A state agency does not have the discretionary authority to automatically reject all claims for retroactive benefits.
The Sanders Decision
The Superior Court of Augusta found that the Administrative Law Judge's earlier decision in favor of state agency's policy flew in the face of his own findings, namely that extenuating circumstances "made it impossible for the Sanders to apply for benefits at the earliest possible date of the child's eligibility." The A.L.J. agreed that important medical records from their child's early months were not disclosed to the Sanders prior to the adoption. In addition, he also found that the Georgia Department of Human Resources did not fully inform the Sanders about the possibility of receiving adoption assistance. The assumption that their child did not qualify for adoption assistance led the Sanders to waive their application for the program.
Not only did the state's policy deny the Sanders a means of regaining years adoption assistance lost through no fault of their own, noted the court, but such a policy
allows the Department to shield itself from payment of statutorily mandated benefits by simply failing to fully inform prospective adoptive parents. This is inherently wrong and clearly in contravention of the statutory scheme and intent of both the federal and state statutes set out herein. Therefore, the A.L.J.'s failure to determine and consider the child's eligibility prior to the Sanders' application was clearly erroneous.
The court remanded the case back for another hearing to determine if retroactive assistance should be awarded with the strong suggestion that such assistance was warranted by the facts of the case.
Policy and Legal Issues
In reviewing the Sanders' administrative hearing and subsequent appeal, the court observed that like other states, Georgia's adoption assistance program received federal funds "provided the state complies with the federal guidelines supplied in the regulations. 42 U.S.C. § 673; 45 C.F.R. §1356.40 (2001)." The judge singled out 45 C.F.R §1356.40(f) as having "particular importance in interpreting the mandate to the states." That provision, noted the judge, "places an affirmative duty on the states to promote the adoption assistance program."
Moreover, concluded the court, the affirmative duty to promote the adoption assistance program illuminated the discussion of retroactive eligibility in Federal Policy Announcement (ACYF-CB-PA)-01-01, issued in by the U.S. Department of Health and Human Services (HHS) in January, 2001. It was 45 C.F.R §1356.40 (f), wrote the court,
that led HHS to issue its policy announcement which provides that adoptive parents who feel they were wrongly denied benefits on behalf of an adoptive child have the right to a fair hearing, and if the child meets all the eligibility criteria assistance is available beginning with the earliest date of the child's eligibility. HHS Policy Announcement ACYF-CB-PA-01-01 (2001). This announcement was released to eliminate the confusion caused by previous policy interpretations on the subject, and represents merely a clarification, not a new mandate. See id. This language indicates that the federal program requires states to provide a fair hearing where benefits have been wrongly denied, and both gives them the authority and requires them to rectify the wrong once eligibility has been shown. See id.
Significance
The Sanders and Alsdorf Judicial Reviews both determined that:
1. Federal law requires states to hear each case for retroactive payments on its individual merits. A policy of blanket denial of retroactive payments or one that automatically limits such payments to the parent's most recent post adoptive request for adoption assistance is contrary to federal law.
2. The cases should be reconsidered and both were remanded back for hearings on the merits of the families' claims for retroactive assistance payments. In doing so, both judges indicated that if the child was wrongfully denied adoption assistance due to extenuating circumstances, benefits should be awarded back to the earliest date of eligibility. The earliest date of eligibility is prior to finalization of the adoption is most commonly the date of the adoptive placement. In Alsdorf, the judge wrote:
The Court believes that by finally granting the adoption benefits 11 years after the placement of the children with the Alsdorfs, the State acknowledged their failures in this adoption. It would therefore appear that if the agency had seriously considered the facts and equities in this case, instead of relying on the "automatic denial policy," and exercised its discretion in this case, the Alsdorfs would have been seriously considered for an award of retroactive benefits. It would appear to the Court that the Alsdorfs are seeking approximately $48,000 in retroactive benefits.
The judge in Sanders concluded that the by stipulating that federal adoption assistance is available "beginning with the earliest date of the child's eligibility" in cases where adoptive families were wrongly denied benefits, P.A. 01-01 went farther than merely allowing states to make pay retroactive benefits. P.A. 01-01, he ruled, not only gives states the authority to make such payments but also "requires them to rectify the wrong once eligibility has been shown."
Failure to provide adoptive parents with adequate information about their child's background or about adoption assistance programs constituted a violation of federal regulation 45 C.F.R. §1356.40 (f) which places an affirmative responsibility on the state to promote the adoption assistance program. Adoptive families who do not obtain adoption assistance on behalf of otherwise eligible children because of a lack of adequate information are entitled to redress which includes the possibility of recouping the adoption assistance that that they would have received had the errors or omissions not taken place. 45 C.F.R. §1356.40 (f) was previously invoked in Ferdinand v Department for Children and Their Families, 768 F. Supp. 401 (D.R.1 1991) one of the seminal cases that authorized a child's eligibility for adoption assistance after finalization.
The court's interpretations of federal policy regarding retroactive payments in Sanders and Alsdorf was remarkably similar to those reached in earlier court and hearing decisions in the states of Pennsylvania, Washington, Arizona and Indiana. See Legal section of this Web site for copies of those decisions. Those decisions relied heavily on federal Policy Interpretation Question (PIQ) 92-02, which was superseded by P.A. 01-01. The language pertaining to retroactive payments in PIQ 92-02 is quite similar to that of its successor, but if anything is somewhat more equivocal. PIQ 92-02 stated following a post adoptive hearing:
If a State chooses to pay adoption assistance retroactively from the earliest date of the child's eligibility in accordance with Federal and State statutes, regulations and policies, the State may claim Federal financial participation for this expenditure. For cases in which there was no signed adoption assistance agreement, the earliest date of eligibility would be that of the interlocutory or final decree for assistance provided before October 1, 1986, or placement in an adoptive home for assistance provided after October 1, 1986. States should sign a new agreement backdated to the earliest date of eligibility for the child.
The judges in those cases ruled that the language of PIQ 92-02 not only authorized states to make retroactive payments, but required them to make such payments. All of the cases made the same essential points.