This opinion will be unpublished and
may not be cited except as provided by
Minn. Stat. § 480A.08, subd. 3 (2006).
IN COURT OF APPEALS
Department of Human Services,
Hennepin County District Court
File No. 27-CV-05-006892
Jennifer Moore, Moore Family Law,
Lori Swanson, Attorney General, Patricia A. Sonnenberg, Assistant Attorney General, 445 Minnesota Street, Suite 900, St. Paul, MN 55101-2127 (for respondent)
Considered and decided by Halbrooks, Presiding Judge; Toussaint, Chief Judge; and Ross, Judge.
Ken Wolter, the noncustodial parent of two children receiving state medical-assistance services, challenges the Department of Human Services’ determination of the parental fee that he must pay to contribute to the cost of his children’s services. Wolter argues that the department erroneously interpreted Minn. Stat. § 252.27, subd. 2a(b), to provide a reduced fee only for custodial parents. Because the plain language of section 252.27 excludes noncustodial parents, and the department’s interpretation is consistent with the statute, we affirm.
This appeal concerns the calculation of a parental fee for parents of minors receiving state medical-assistance services and the availability of a reduced fee for noncustodial parents when the minor receives care in the custodial home. Ken Wolter has three children. Two of his daughters have Batten’s Disease, a terminal neurological disorder that causes severe mental and physical impairment over time. Wolter divorced the children’s mother in 1997, and the district court gave the parties joint legal custody. The court afforded his former wife sole physical custody of their daughters and gave Wolter liberal parenting time. Wolter’s time with his daughters increased in 2002 when their mother was diagnosed with cancer. Wolter transported his daughters to medical and school appointments and provided some care for them in their mother’s home. After their mother’s death in 2005, Wolter did not seek physical custody, and his daughters were transferred to separate out-of-home placements.
Because of their medical condition, Wolter’s daughters qualify for medical-assistance services from the state. The program they participated in that is relevant to Wolter’s appeal allowed them to receive services while minors, regardless of their parents’ income. But the program requires parents to contribute to the cost of services through a monthly parental fee.
Wolter challenges the calculation of his parental fee for the 2002, 2003, and 2004 fiscal years, arguing that he is statutorily entitled to a reduced fee because his daughters received in-home care, even though this care was not provided in his home. His older daughter received services only through November 2001, when she turned 18, and his younger daughter received services during all of the challenged years. The Department of Human Services denied Wolter’s challenge on the ground that only custodial parents may receive the home-care credit, and the children’s mother, not Wolter, was the only custodial parent. Wolter appealed to the Commissioner of Human Services, who affirmed the department’s decision. Wolter requested the district court to recalculate his fee, but the court affirmed the agency’s decision. He now appeals to this court.
D E C I S I O N
appeal requires us to construe and apply portions of Minnesota Statutes section
252.27. During the challenged fiscal
years, Wolter’s daughters received services through a program that does not
base a minor’s eligibility on her parents’ financial circumstances, but
requires parents to contribute to the cost of services in the form of a monthly
parental fee. See Minn. Stat. § 252.27, subd. 2a(a) (2006) (requiring minor’s
parents to contribute to services with monthly payment). When a child’s parents live
separately, each parent is assessed a parental fee.
2003 the legislature amended the formula for calculating the parental fee. 2003
Although the formula for determining the parental fee and the form of the home-care credit have changed, Wolter’s legal challenge under each provision is the same. He challenges the agency’s denial of the credit to him, arguing that the former $200 monthly deduction and current $2,400 income reduction apply to custodial and noncustodial parents when a child does not live in a state facility. We conclude that the agency correctly applied the statute and denied Wolter the requested credit.
court may reverse or modify an agency’s decision on appeal if it finds that a
party’s substantial rights have been prejudiced because the agency decision
violated a constitutional provision, exceeded the agency’s authority, was made through
unlawful procedure, was affected by an error of law, was unsupported by
substantial evidence, or was arbitrary or capricious. See
Hy-Vee Food Stores, Inc. v.
reviewing whether an agency has properly applied a statute, we focus first on
the statute’s words to ascertain and effectuate the legislature’s intent.
department’s interpretation of section 252.27 follows the statute’s plain
language, which provides a reduced fee only for custodial parents. When parents of a child receiving services do
not live together, each parent’s fee is calculated using the same formula as
parents residing together, but the fees are calculated separately without
regard to the other parent’s income.
Paragraph (b) of subdivision 2a sets out the formula for determining the
percentage of the parent’s adjusted gross income that will constitute the
parental fee. Minn. Stat. § 252.27,
subd. 2a(b). The 2004 statute, which
incorporated the 2003 amendment and applied to Wolter for the 2004 fiscal year,
states, “If the child lives with the parent, the annual adjusted gross income
is reduced by $2,400 prior to calculating the parental contribution.”
points to the agency’s rule interpreting section 252.27 to support his argument
that “the parent” means either parent. In setting out the formula for calculating
the monthly parental fee, the rule directs the department to “subtract $200 if
the child receiving services lives with the parents.”
As the commissioner aptly noted, Wolter’s argument that the court should read “parents” to mean either parent would suggest reading surrounding provisions the same way. For example, when calculating the parental fee, the agency’s formula in subpart 6.E of rule 9550.6220 also provides for an increase “if health insurance was available to the parents . . . but was not taken.” Minn. R. 9550.6220, subp. 6.E.(4) (2005); see also Minn. Stat. § 252.27, subd. 2a(h) (2006) (providing for increased fee if parent declined available health insurance). Applying Wolter’s reading of subpart 6.E.(6) to this provision, both separated parents would be penalized for only one parent’s failure to provide available health insurance. This interpretation is not only implausible for that reason; it would also conflict with the statutory requirement to calculate separate fees when parents do not live together. Because the agency correctly applied the plain meaning of section 252.27, subdivision 2a, we affirm its decision to deny Wolter a reduced parental fee.
suggests that the department’s current position conflicts with its prior
practice and therefore represents an unpromulgated rule. But a department representative testified
that the department has always interpreted the statute to apply the home-care
credit only to the custodial parent, and this interpretation is consistent with
the plain meaning of the statute. See Mapleton Cmty. Home, Inc. v.
Wolter argues that the agency’s decision is arbitrary and capricious because no
reasonable basis supports distinguishing between custodial and noncustodial
parents. This argument is problematic
because the agency is following the policy set forth by the legislature. The legislature’s reason for distinguishing
between custodial and noncustodial parents is unknown, but the department has
made reasonable inferences from the statute regarding its purpose. The department’s representative testified
that the department believes that the intent is to provide a deduction to the
parent who contributes most to providing the child’s support because
noncustodial parents do not incur the same day-to-day expenses as custodial
parents. This position is congruent with
other provisions of the statute. Before
the parental fee is calculated, a noncustodial parent may deduct from his
adjusted gross income any court-ordered child support paid on behalf of the
child receiving services.
 The agency has not amended its rules to reflect the 2003 statutory change to the annual $2,400 adjusted-gross-income deduction.