McNamar v. Apfel, 10th Cir. (1999)

F I L E D
United States Court of Appeals

Tenth Circuit
PUBLISH
APR 15 1999
UNITED STATES COURT OF APPEALS
PATRICK FISHER
Clerk
TENTH CIRCUIT
CATHY McNAMAR,
Plaintiff-Appellant,
No. 98-5077
v.
KENNETH S. APFEL, Commissioner
of Social Security Administration,
Defendant-Appellee.
APPEAL FROM THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF OKLAHOMA
(D.C. No. 96-CV-1134-M)
Submitted on the briefs:
Paul F. McTighe, Jr., Tulsa, Oklahoma, for Plaintiff-Appellant.
Stephen C. Lewis, United States Attorney, Peter Bernhardt, Assistant U.S.
Attorney, Tulsa, Oklahoma, and Tina M. Waddell, Chief Counsel, Region VI,
Mark J. Kingsolver, Deputy Chief Counsel, and Linda H. Green, Assistant
Regional Counsel, Office of the General Counsel, Social Security Administration,
Dallas, Texas, for Defendant-Appellee.
Before BALDOCK , BARRETT and HENRY , Circuit Judges.
BARRETT , Senior Circuit Judge.
Appellant Cathy McNamar appeals the district courts affirmance of the

final decision of the Commissioner of Social Security reducing appellants
disability benefits by the amount of her Civil Service disability benefits, without
excluding her monthly health insurance premium. Because the Commissioners
decision is supported by substantial evidence and correct legal standards were
applied, we affirm.
Appellant is disabled by Crohns Disease. She receives $747 in monthly

disability benefits from the Civil Service Retirement System, from which health
insurance premiums and taxes are deducted. Appellant also receives social
security disability benefits. Because appellant is eligible to receive both social
security disability benefits and disability benefits from another government plan,
federal law requires that her social security benefits be reduced.
See 42 U.S.C.
424a(a); 20 C.F.R. 404.408(a)(2). This appeal involves the amount by which

appellants social security benefit must be reduced.
The Commissioner offset appellants entire civil service disability payment
against her social security disability payment, without excluding her monthly
After examining the briefs and appellate record, this panel has
determined unanimously to grant the parties request for a decision on the briefs
without oral argument. See Fed. R. App. P. 34(f); 10th Cir. R. 34.1(G). The case
is therefore ordered submitted without oral argument.
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health insurance premiums from the offset. The Commissioners decision was
based on the language of 20 C.F.R. 404.408(d), which identifies expenses that
may be excluded from the offset, and on several provisions of the Social Security
Administrations Program Operations Manual System (POMS), a set of policies
issued by the Administration to be used in processing claims. The district court
affirmed the computation. On appeal, appellant argues that her health insurance
premiums are future medical expenses which should have been excluded from
the offset pursuant to 20 C.F.R. 404.408(d).
We review the Commissioners decision to determine whether it is
supported by substantial evidence and whether correct legal standards were
applied. See Hawkins v. Chater , 113 F.3d 1162, 1164 (10th Cir. 1997). Our
review of an agencys interpretation of a statute or regulation it administers is
highly deferential.
See Thomas Jefferson Univ. v. Shalala
, 512 U.S. 504, 512
(1994); Wilkins v. Callahan , 127 F.3d 1260, 1262 (10th Cir. 1997). Such an
interpretation is given controlling weight unless it is arbitrary, capricious, or
contrary to law.
See Thomas Jefferson Univ. , 512 U.S. at 512 ([T]he agencys
interpretation must be given controlling weight unless it is plainly erroneous or

inconsistent with the regulation.) (quotations omitted);
New Mexico Dept of
Human Servs. v. Department of Health & Human Servs.
, 4 F.3d 882, 884
(10th Cir. 1993).

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The offset statute itself does not authorize the exclusion of any amounts
from the offset.
See 42 U.S.C. 424a(a). The Social Security Administrations
implementing regulation does, however, exclude the following amounts:

[a]mounts paid or incurred, or to be incurred, by the individual for
medical, legal, or related expenses in connection with the claim for
public disability payments . . . or the injury . . . on which the public
disability award . . . is based, . . . to the extent they . . . reflect either
the actual amount of expenses already incurred or a reasonable
estimate . . . of future expenses. Any expenses . . . not reflecting a
reasonable estimate of the individuals actual future expenses will
not be excluded.
20 C.F.R. 404.408(d). The agency has further clarified this regulation in two
POMS provisions which appear to foreclose appellants argument that her health
insurance premiums should have been excluded as future medical expenses.
See
POMS DI 52001.050(C)(2), attached to Appellants Br. (expressly stating that

health insurance premiums should be offset against the social security disability
benefit, and that such amounts are not excludable expenses); POMS
DI 52001.535(2) and (7), attached to Appellants Br. (requiring verification of
medical expenses, and stating that amounts for future medical expenses which
are not specified in the public disability award may not be excluded until they
are actually incurred). The question then, is whether these agency interpretations
are arbitrary, capricious, or contrary to law.
Because the offset statute does not exclude any amounts from the required
offset, see 424a(a), the Commissioners failure to exclude appellants health
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insurance premiums cannot be contrary to the statute. Nor does it appear that the
failure to exclude such premiums is contrary to the implementing regulation, as
the premiums do not represent an estimate of appellants actual future expenses
related to her Crohns disease. Although appellants health insurance may, at
some point, pay for disability-related medical expenses, it is not limited to these
expenses, but instead may be used to pay for an entire spectrum of medical care.
Finally, appellant has not shown that the agencys interpretation of the setoff
requirement, as enunciated in the POMS, is arbitrary or capricious.
The judgment of the United States District Court for the Northern District
of Oklahoma is AFFIRMED.
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McNamar v. Apfel, 10th Cir. (1999)

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McNamar v. Apfel, 10th Cir. (1999)

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F I L E D

United States Court of Appeals

UNITED STATES COURT OF APPEALS

APPEAL FROM THE UNITED STATES DISTRICT COURT

Appellant Cathy McNamar appeals the district courts affirmance of the

Appellant is disabled by Crohns Disease. She receives $747 in monthly

424a(a); 20 C.F.R. 404.408(a)(2). This appeal involves the amount by which

See Thomas Jefferson Univ. v. Shalala

, 512 U.S. 504, 512

See Thomas Jefferson Univ. , 512 U.S. at 512 ([T]he agencys

interpretation must be given controlling weight unless it is plainly erroneous or

New Mexico Dept of

Human Servs. v. Department of Health & Human Servs.

, 4 F.3d 882, 884

(10th Cir. 1993).

See 42 U.S.C. 424a(a). The Social Security Administrations

implementing regulation does, however, exclude the following amounts:

POMS DI 52001.050(C)(2), attached to Appellants Br. (expressly stating that

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