TAXPAYERS AND MEMBERS OF THE WEST VIRGINIA
SENATE; RODNEY T. BERRY, ET AL., AS CITIZENS,
TAXPAYERS AND MEMBERS OF THE WEST VIRGINIA
HOUSE OF DELEGATES, AND WEST VIRGINIANS FOR
LIFE, INC., A WEST VIRGINIA CORPORATION,
OF THE WEST VIRGINIA DEPARTMENT OF
HEALTH AND HUMAN RESOURCES,
Honorable Patrick Casey, Judge
Civil Action No. 90-C-3916
Victor A. Barone
Jeffrey K. Matherly
Hurt & Barone Deputy Attorney General
Charleston, West Virginia Charleston, West Virginia
James Bopp Attorney for the Appellant
Brames, McCormick, Bopp
Terra Haute, Indiana
Attorneys for the Appellees
JUSTICE MILLER delivered the Opinion of the Court.
1. Under the federal Medicaid program, 42 U.S.C.
§ 1396, et seq., a participating state is free, if it so chooses,
to include in its Medicaid plan those medically necessary abortions
for which federal reimbursement is unavailable.
2. The Hyde Amendment's restriction on the use of
federal Medicaid funds to pay for abortions in certain instances
does not prohibit a state from expending its own state funds to pay
3. "Statutes which relate to the same subject matter
should be read and applied together so that the Legislature's
intention can be gathered from the whole of the enactments."
Syllabus Point 3, Smith v. State Workmen's Compensation Comm'r, 159
W. Va. 108, 219 S.E.2d 361 (1975).
4. W. Va. Code, 9-4-2 (1983), does not prohibit the use
of state Medicaid funds to pay for abortions that do not qualify
for federal reimbursement under the Hyde Amendment.
The Secretary of the West Virginia Department of Health
and Human Resources (Department) appeals from an order of the
Circuit Court of Kanawha County which held that W. Va. Code, 9-4-2
(1983), prohibits the use of state Medicaid funds to pay for
abortions that do not qualify for federal reimbursement. We find
that the circuit court erred, and that W. Va. Code, 9-4-2, does not
prohibit these expenditures.
On October 31, 1990, several members of the West Virginia State Legislature, in both their personal and official capacities, as well as West Virginians for Life, Inc., a nonprofit corporation, filed suit in the Circuit Court of Kanawha County seeking declaratory and injunctive relief. The plaintiffs alleged that W. Va. Code, 9-4-2,See footnote 1 prohibits the Department from expending state funds on abortions that do not qualify for federal monies under the "Hyde Amendment."See footnote 2 Following discovery, the plaintiffs filed a motion for summary judgment, which was granted by the trial court on March 29, 1991. On April 1, 1991, the Department petitioned this Court for appeal. We granted the petition and stayed execution of the lower court's order pending our consideration of the appeal.
In 1965, the United States Congress created the Medicaid program by amending the Social Security Act to include Title XIX. See generally 42 U.S.C. 1396, et seq. The Medicaid program is a federal/state cooperative program designed to provide medical services for the poor. If a state decides to accept federal funds under Title XIX, it must furnish five types of servicesSee footnote 3 for the categorically needy.See footnote 4 In interpreting the Medicaid provisions, the United States Supreme Court in Beal v. Doe, 432 U.S. 438, 441, 97 S. Ct. 2366, 2369, 53 L. Ed. 2d 464, 470 (1977), explained that a state is not required "to provide funding for all medical treatment falling within the five general categories, [but must] establish 'reasonable standards . . . which . . . are consistent with the objectives of [the Medicaid program].'" (Citation omitted). Funding for the program is based on a formula under which the federal government matches a state's financial contribution at a ratio based on the state's per capita income. 42 C.F.R. § 433.10 (1991).
Each state that chooses to participate in the Medicaid
program is required to submit a "state plan" to the federal Health
Care Financing Authority (HCFA) for its approval. See generally 42
C.F.R. §§ 430.10 - 430.25. Under its plan, a state must have an
accounting system to assure that requests for federal reimbursement
comply with federal regulations. 42 C.F.R. 433.32. To receive its
matching federal funds, a state is required to file a quarterly
report of its Medicaid expenditures with the HCFA. The state then
receives matching funds for its expenditures from the federal
government. The HCFA audits each state's program quarterly to
verify that the state has followed all federal guidelines. 42
C.F.R. § 430.33.
In 1980, the United States Supreme Court in Harris v. McRae, 448 U.S. 297, 100 S. Ct. 2671, 65 L. Ed. 2d 784 (1980), addressed whether a state participating in the Medicaid program must continue to fund those abortions that do not qualify for federal monies under the Hyde Amendment. Initially, the Court noted that "[s]ince September 1976, Congress has prohibited . . . the use of any federal funds to reimburse the costs of abortions under the Medicaid program except under certain specified circumstances." 448 U.S. at 302, 100 S. Ct. at 2680, 65 L. Ed. 2d at 795. (Footnote omitted). In concluding that states are not required to continue funding these services, the Court reasoned:
"Title XIX was designed as a cooperative program of shared financial responsibility, not as a device for the Federal Government to compel a State to provide services that Congress itself is unwilling to fund. Thus, if Congress chooses to withdraw federal funding for a particular service, a State is not obliged to continue to pay for that service as a condition of continued federal financial support of other services." 448 U.S. at 309, 100 S. Ct. at 2684, 65 L. Ed. 2d at 799-800.
Thus, the Court held that: "Title XIX does not require a
participating State to pay for those medically necessary abortions
for which federal reimbursement is unavailable under the Hyde
Amendment." 448 U.S. at 311, 100 S. Ct. at 2685, 65 L. Ed. 2d at
800. (Footnote omitted). See also Williams v. Zbaraz, 448 U.S.
358, 100 S. Ct. 2694, 65 L. Ed. 2d 831 (1980); Doe v. Heintz, 204
Conn. 17, 526 A.2d 1318 (1987); Right to Choose v. Byrne, 91 N.J.
287, 450 A.2d 925 (1982); Planned Parenthood Ass'n v. Department of
Human Resources, 63 Or. App. 41, 663 P.2d 1247 (1983), aff'd, 297
Or. 562, 687 P.2d 785 (1984). Cf. Beal v. Doe, supra (Social
Security Act does not require States to fund nontherapeutic
abortions as a condition of participating in the Medicaid program).
However, the Supreme Court further observed that although
states are not compelled to pay for abortions, under the federal
Medicaid program "[a] participating State is free, if it so
chooses, to include in its Medicaid plan those medically necessary
abortions for which federal reimbursement is unavailable." 448
U.S. at 311 n.16. 100 S. Ct. at 2684 n.16, 65 L. Ed. 2d at 800
n.16. Harris held "only that a State need not include such
abortions in its Medicaid Plan." 448 U.S. at 311 n.16, 100 S. Ct.
at 2685 n.16, 65 L. Ed. 2d at 800 n.16. (Emphasis in original).
Thus, the Hyde Amendment's restriction on the use of federal
Medicaid funds to pay for abortions in certain instances does not
prohibit a state from expending its own state funds to pay for
abortions. See, e.g., Beal v. Doe, supra; Preterm, Inc. v.
Dukakis, 591 F.2d 121 (1st Cir. 1979), appeal dismissed, King v.
Preterm, Inc., 441 U.S. 952, 99 S. Ct. 2182, 60 L. Ed. 2d 1057
(1979); Dodge v. Department of Social Servs., 657 P.2d 969 (Colo.
App. 1982); Kindley v. Governor of Md., 289 Md. 620, 426 A.2d 908
(1981); Moe v. Secretary of Admin. & Fin., 382 Mass. 629, 417
N.E.2d 387 (1981).
In the wake of Harris v. McRae, the Department concluded
that it was in the best interest of this State to continue funding
abortions that are "determined to be medically advisable by the
attending physician in light of physical, emotional, psychological,
familial, or age factors . . . relevant to the well-being of the
patient.See footnote 5 Because the Department believed that the benefit of
receiving federal funds for the few eligible abortions was
outweighed by the administrative burden of procuring them,See footnote 6 it
elected not to seek federal funds to pay for these services.
Instead, the Department pays for abortions which would otherwise
qualify for federal reimbursement with state funds exclusively. To
assure that federal appropriations are not misused, the Department
deducts the entire amount of expenditures for abortions from the
report it submits to the HCFA for federal matching funds. The HCFA
has audited the West Virginia State Medicaid Plan for several years
and has never questioned the State's procedure.
The plaintiffs concede, as they must under any reading of Harris v. McRae, that a state may, if it so chooses, pay with its own funds for medical services that are not eligible for federal reimbursement, including abortions. The plaintiffs argue, however, that under W. Va. Code, 9-4-2, the legislature has chosen not to provide such funds.See footnote 7 Specifically, the plaintiffs argue, and the trial court found, that because W. Va. Code, 9-4-2, requires that state monies be appropriated "consistent with applicable federal laws, rules and regulations," it incorporates the Hyde Amendment as a restriction on the use of state funds. In the alternative, the plaintiffs contend that because state funds are commingled with federal funds before medical bills are paid, federal dollars are illegally being used to provide this service.
We begin with the basic proposition that
"[i]nterpretations of statutes by bodies charged with their
administration are given great weight unless clearly erroneous."
Syllabus Point 4, Security Nat'l Bank & Trust Co. v. First W. Va.
Bancorp, Inc., 166 W. Va. 775, 277 S.E.2d 613 (1981), appeal
dismissed, 454 U.S. 1131, 102 S. Ct. 986, 71 L. Ed. 2d 284 (1982).
However, when the agency's "interpretation is unduly restricted and
in conflict with the legislative intent, the agency's
interpretation is inapplicable." Syllabus Point 5, in part, Hodge
v. Ginsberg, 172 W. Va. 17, 303 S.E.2d 245 (1983). Thus, we must
first ascertain the legislature's intent when it enacted W. Va.
W. Va. Code, 9-4-2, is just one section in Chapter 9 of
the Code, which deals with human services. A cardinal rule of
statutory construction compels us to consider any section in the
context of the entire statutory scheme to which it relates. As we
explained in Syllabus Point 3 of Smith v. State Workmen's
Compensation Commissioner, 159 W. Va. 108, 219 S.E.2d 361 (1975):
"Statutes which relate to the same subject matter should be read and applied together so that the Legislature's intention can be gathered from the whole of the enactments."
See, e.g., Manchin v. Dunfee, 174 W. Va. 532, 327 S.E.2d 710
(1984); Clendenin Lumber & Supply Co. v. Carpenter, 172 W. Va. 375,
305 S.E.2d 332 (1983); Farley v. Zapata Coal Corp., 167 W. Va. 630,
281 S.E.2d 238 (1981); State ex rel. Callaghan v. West Virginia
Civil Serv. Comm'n, 166 W. Va. 117, 273 S.E.2d 72 (1980).
While the phrase "consistent with applicable federal law
and regulations," which was the linchpin of the circuit court's
holding, is found in W. Va. Code, 9-4-2, this section also uses key
definitional terms found in other sections of Chapter 9. The
applicable language of W. Va. Code, 9-4-2, is:
"The fund shall consist of payments made into the fund out of state appropriations for medical services to recipients of specified classes of welfare assistance and such federal grant-in-aid as are made available for specified classes of welfare assistance. . . .
"Recipients of those classes of
welfare assistance as are specified by the
department, consistent with applicable federal
laws, rules and regulations, shall be entitled
to have costs of necessary medical services
paid out of the fund[.]" (Emphasis added).See footnote 8
The legislature defined "welfare assistance" in W. Va. Code, 9-1-2(f) (1972), as "the three classes of assistance administered by the department [division], namely: Federal-state assistance, federal assistance and state assistance." These three forms of assistance are also defined in W. Va. Code, 9-1-2.
"Federal-state assistance" arises under the various shared-expense
cooperative programs authorized by the United States Congress and
specifically includes the Medicaid program found in "subchapter
. . . nineteen, chapter seven, Title 42, United States Code[.]"
W. Va. Code, 9-1-2(c). "Federal assistance" includes "pass-through" programs in which the State merely acts as the distributor
and "the cost of which is paid entirely out of federal
appropriations." W. Va. Code, 9-1-2(d). "State assistance" is
defined to "mean and include all forms of aid, care, assistance,
services and general relief made possible solely out of state,
county and private appropriations to or on behalf of indigent
persons, which are authorized by, and who are authorized to receive
the same under and by virtue of, department rules and regulations."
W. Va. Code, 9-1-2(e).
Thus, when the legislature stated in W. Va. Code, 9-4-2,
that "[r]ecipients of those classes of welfare assistance . . .
shall be entitled to have costs of necessary medical services paid
out of the fund," it must have recognized that the fund administers
more than one type of assistance. In other words, the legislature
clearly understood that the fund would operate programs with
different purposes and funding under the three categories outlined
above. Accordingly, we find that the Department's interpretation
of W. Va. Code, 9-4-2, is in harmony with the legislature's intent
when it enacted this provision.
As earlier noted, the Department utilizes state funds
entirely to pay for abortion services and does not use federal
dollars for abortion-related expenses. Even though disbursements
are made from the fund after federal matching funds are received,
by using the most basic accounting procedures, the Department knows
how much of the budget is state money and how much is federal. As
long as expenditures for abortions are not included in the request
for federal matching funds, there is no possibility that federal
funds are being misappropriated. Consequently, the lower court's
finding that federal funds are being used to subsidize abortions in
this State is erroneous.
Plaintiffs also assert that W. Va. Code, 9-4-2, compels
the State to comply with the Hyde Amendment because it mandates
that welfare assistance be distributed "consistent with applicable
federal laws, rules and regulations." While we agree with the
plaintiffs that the Hyde Amendment is federal law, so also is the
United States Supreme Court's interpretation of this provision in
Harris v. McRae. Under Harris, West Virginia may choose to use its
own revenues to fund abortions or not to fund abortions. Moreover,
the same language that the plaintiffs cite is found in the 1972
version of W. Va. Code, 9-4-2, which was enacted four years before
the first Hyde Amendment was passed. We find it hard to conceive
that our legislature incorporated a future federal legislative
provision into W. Va. Code, 9-4-2, especially where the legislature
couched its language in such general terms.
Finally, we refuse to adopt a tortured construction of W. Va. Code, 9-4-2, where that construction has far-reaching implications on whether other medical procedures could be covered under our state Medicaid program. Although the plaintiffs would like to frame the outcome of this case as affecting only poor women and their right to reproductive privacy, the reasoning of the trial court's order has a much broader impact. In essence, the court's order would prohibit the State of West Virginia from spending state funds for any medical services not authorized for federal reimbursement.
There are numerous federal regulations that proscribe the
use of federal funds for certain medical services. For example,
federal funding is not available under the Medicaid program where
the patient is in a public institution,See footnote 9 or is over twenty-one but
under sixty-five and is in a mental institution. See 42 C.F.R.
§ 441.13. Likewise, federal funding is unavailable for certain
categories of sterilization. See generally 42 C.F.R. §§ 441.253 -
441.255. Finally, certain services offered with organ transplants
are not eligible for federal reimbursement. See 42 C.F.R.
§ 441.13. Thus, if we were to accept the plaintiffs'
interpretation of W. Va. Code, 9-4-2, the State of West Virginia
would be prohibited from using state tax dollars to provide
services it may deem necessary for its impoverished citizens. We
cannot imagine that the legislature intended such a result,
especially when it included in the definition of "welfare
assistance" programs that are funded by the state alone.See footnote 10
Not only do we believe that the legislature did not
intend the result urged by the plaintiffs, but to reach that
conclusion we would have to ignore the very foundation of the
Medicaid program. As aptly stated by the United States Supreme
Court: "The cornerstone of Medicaid is financial contribution by
both the Federal Government and the participating State." Harris
v. McRae, 448 U.S. at 308, 100 S. Ct. at 2684, 65 L. Ed. 2d at 799.
The linchpin of a federal-state cooperative program is that it is
cooperative. Obligations are assumed by the state voluntarily. If
a state chooses not to handle a particular category of medical
service according to federal regulations, it may do so. The state
simply forgoes the opportunity to have the federal government share
the cost of that particular service. Federal reimbursement is a
carrot, not a bullwhip.
For these reasons, we hold that W. Va. Code, 9-4-2, does
not prohibit the use of state Medicaid funds to pay for abortions
that do not qualify for federal reimbursement under the Hyde
Accordingly, the judgment of the Circuit Court of Kanawha County is therefore reversed.
Footnote: 1W. Va. Code, 9-4-2, established the Department of Human Services medical services fund. Monies from the fund are used to pay for medical services for the poor. See note 7, infra, for its relevant provisions.
Footnote: 2This funding restriction, commonly known as the "Hyde Amendment," was so named after its original congressional sponsor, Representative Henry J. Hyde.
The 1991 version of the Hyde Amendment provided: "None of the funds contained in this Act shall be used to perform abortions except where the life of the mother would be endangered if the fetus were carried to term." See Department of Labor, Health & Human Services, & Education & Related Agencies Appropriations Act, Pub. L. No. 101-517, § 203, 104 Stat. 2190, 2208 (1991). The 1992 version of the Hyde Amendment is identical. See Department of Labor, Health & Human Services, & Education & Related Agencies Appropriations Act, Pub. L. No. 102-170, § 203, 105 Stat. 1107, 1126 (1992).
Footnote: 3These services include (1) inpatient hospital services; (2) outpatient hospital services; (3) laboratory and x-ray services; (4) skilled nursing services, periodic screening, diagnostic services, and family planning services; and (5) physician's services. See 42 U.S.C. § 1396a(a)(10)(A) (1992), and 42 U.S.C. § 1396d(a)(1) - (5).
Footnote: 4The "categorically needy" include needy people with children, the aged, blind, and disabled. 42 U.S.C. § 1396a(a)(10)(A). Title XIX also permits states to extend medical benefits to individuals who are "medically needy." See 42 U.S.C. 1396a(a)(10)(C).
Footnote: 5Pursuant to Policy No. MA-85-4, the Department
"makes reimbursement for pregnancy
termination when it is determined to be
medically advisable by the attending
physician in light of physical, emotional,
psychological, familial, or age factors (or a
combination thereof) relevant to the well-being of the patient.
"Reimbursement is made for
pregnancy termination upon the determination
of the physician, in consultation with the
patient, that the pregnancy termination is
medically advisable. In making his/her
determination, it is necessary for the
physician to discuss the pregnancy
termination decision with the patient in
light of her age, physical, emotional,
psychological, and/or familial
Footnote: 6Federal matching dollars are not available for abortions unless the attending physician certifies in writing that the mother's life would be endangered if the fetus were carried to term. 42 C.F.R. § 441.203.
Footnote: 7W. Va. Code, 9-4-2, provides, in pertinent part:
"The special fund known as the
State of West Virginia public assistance
medical services fund . . . shall be
continued in accordance with the provisions
of this section so long as the same may be
required by federal laws, rules and
regulations applicable to federal-state
assistance and thereafter so long as the
commissioner shall deem such fund to be
otherwise necessary or desirable, and
henceforth such special fund shall be known
as the department [division] of human
services medical services fund, hereinafter
referred to as the fund.
"The fund shall consist of payments made into the fund out of state appropriations for medical services to recipients of specified classes of welfare assistance and such federal grant-in-aid as are made available for specified classes of welfare assistance. Any balance in the fund at the end of any fiscal year shall remain in the fund and shall not expire or revert. Payments shall be made out of the fund upon requisition of the commissioner by means of a warrant signed by the auditor and treasurer.
"Recipients of those classes of
welfare assistance as are specified by the
department, consistent with applicable
federal laws, rules and regulations, shall be
entitled to have costs of necessary medical
services paid out of the fund, in the manner
and amounts, to the extent, and for the
period determined from time to time to be
feasible by the commissioner pursuant to
rules, regulations and standards established
by him. Such rules, regulations and
standards shall comply with requirements of
applicable federal laws, rules and
regulations and shall be established on the
basis of money available for the purpose, the
number of recipients, the experience with
respect to the incidence of illness, disease,
accidents, and other causes among such
recipients causing them to require medical
services and the costs thereof, the amounts
which recipients require otherwise in order
to maintain a subsistence compatible with
decency and health, and any other factor
considered relevant and proper by the
Footnote: 8For additional text of W. Va. Code, 9-4-2, see note 7, supra.
Footnote: 9A "public institution" is "an institution that is the responsibility of a governmental unit or over which a governmental unit exercises administrative control." 42 C.F.R. § 435.1009.
Footnote: 10For the last three years, the legislature has attempted to restrict the use of state monies to pay for abortions by inserting prohibitory language in the budget bill. We have stated in a number of cases that the budget bill cannot be used to adopt or change unrelated substantive statutes. See, e.g., Benedict v. Polan, ___ W. Va. ___, 413 S.E.2d 107 (1991); Dadisman v. Moore, 181 W. Va. 779, 384 S.E.2d 816 (1988). See also Jones v. Rockefeller, 172 W. Va. 30, 303 S.E.2d 668 (1983); DeVault v. Nicholson, 170 W. Va. 719, 296 S.E.2d 682 (1982).