dissenting:
This appeal turns on the resolution of two issues. The first and most important is *271whether Virginia, as a “§ 209(b)” participating State under the federal Medicaid program adopted as a part of the Social Security Act of 1965, was entitled, prior to the effective date of the Boren-Long Amendment in 1980,1 to enforce its transfer of assets rule, which was a part of its approved participating Medicaid plan, as of January 1, 1972. The majority’s answer to this question is that Virginia could not because the rule conflicts with the proper construction of the provisions of the initial federal statute for state participation in the program and with the regulations of the Secretary of Health and Human Services (Secretary) issued thereunder. I disagree.
In Schweiker v. Gray Panthers, 453 U.S. 34, 43-44, 101 S.Ct. 2633, 2640, 69 L.Ed.2d 460 (1981), the Supreme Court stated the principles to guide courts in the construction and application of the statutory authorization for the Medicaid program. In that connection, it said that because of the “byzantine construction” of the statute creating such program, which was “among the most intricate ever drafted by Congress,” Congress had “conferred on the Secretary exceptionally broad authority to prescribe standards” as provided for in the statute and to define statutory “terms,” an authority which, when exercised, was to be given, as it were, “ ‘legislative effect’ ” and, in particular, it “ ‘entrusted] to the Secretary, rather than to the courts, the primary responsibility for interpreting the statutory term,”’ including in particular the term “ ‘available’ ” as used in the federal statute to designate for Medicaid eligibility thereunder.2
The federal statute creating this Medicaid program contemplated joint federal and state participation. In order to induce state participation, the federal government offered to make grants to participating states which submitted plans conforming to the standards fixed in the federal statute by the Congress and had been approved as so conforming, by the Secretary. § 1396, 42 U.S.C. Virginia submitted such a proposed plan shortly after the statute was enacted. Included in that plan was a transfer of assets provision under which any applicant or recipient who transferred property for less than its fair market value for the purpose of obtaining Medicaid coverage was ineligible for participation in the program for a period of one year, subject to certain exceptions.3 This provision was similar to plans submitted by many other states. The Secretary perceived in such provisions, manifestly designed to frustrate abuse of the program, nothing at variance with the broad purposes of the Act or its language if given the pragmatic interpretation intended by Congress, or with his regulations. It accordingly from the beginning of the program approved such provisions as valid and made grants under the Act to the states submitting plans which included such provisions.4
In 1972, Congress contemplated, in the course of replacing certain of the categorical assistance programs with what was known as the Supplementary Security Income (SSI) program, to change Medicaid eligibility to parallel SSI rules of eligibility. Congress feared, however, that, if this were done uniformly the burden in the case of *272those states with approved Medicaid plans less favorable to recipients than the SSI standards would induce many to withdraw with serious consequences for the program. Accordingly, Congress proceeded in the amendment to the Act, adopted at that time, to give “the states an option to limit Medicaid assistance to people who would have been eligible under the state’s plan that was in effect on January 1 of that year (1972).” Synesael v. Ling, 691 F.2d 1213, 1214 (7th Cir.1982). In effect, by this amendment Congress represented to the states, as an inducement to remain as a participant in the program, that any state, at its option, could elect, rather than following the SSI schedule of benefits, to retain its limits on benefits established by its plan to recipients of Medicaid assistance as set forth in its approved plan in effect on January 1, 1972, including by necessary implication its transfer of assets provisions. The states exercising such option were known as “Section 209(b)” states; those states, on the other hand, which elected to accept the broad SSI coverage, were known as “SSI” states. Virginia was one of almost half the states which elected to become a “Section 209(b)” state, accepting ' Congress’ assurances that it was thereby limiting its burden by the provisions of its approved plan in effect on January 1, 1972. Thus, until the effective date of the Boren-Long Amendment to the Act in 1981, the participating states under the Medicaid program were divided into two classes, one, “Section 209(b)” states, and, two, “SSI” states, in which the provisions for assistance were expected to be different. During all of this period Virginia was a “Section 209(b)” state, operating under its approved plan in effect on January 1,1972 with the transfer of assets provision.
After the adoption of this amendment creating the two classes of participating states, the Secretary recognized that “Section 209(b)” states, such as Virginia, could, unlike the “SSI” states, follow their approved plan of benefits in effect on January 1, 1972, including their transfer of assets provision, and continue to receive grants under the statute as a conforming state. The Secretary has never apparently departed from this position and he is before this Court in this case asserting the right of “§ 209(b)” states, such as Virginia, to enforce, prior to the effective date of the Boren-Long Amendment, their transfer of assets provisions if such provisions were a part of their approved plan on January 1, 1972.
Moreover, Congress itself knew of and implicitly approved of the Secretary’s application and interpretation of the amendment. It violates common sense to assume that Congress was unaware throughout the ’70s that “§ 209(b)” states were applying transfer of assets limitations, although “SSI” states were forbidden to do so by the amendment of 1972. Any doubt on this point is dissipated by the legislative history leading up to the Boren-Long Amendment itself. In 1980 the reports of the various Congressional Committees, particularly that set forth on pp. 5596-97, U.S.Code Cong. & Admin.News, 96th Cong., 2d Sess., (1980), show beyond question that Congress was completely aware of this difference between the “SSI” states and the “§ 209(b)” states in connection with the authority to provide against transfer of assets and that it (Congress) approved of such difference as within Congressional intendment. Beyond this, the Supreme Court has recognized the difference in authority in this area between “§ 209(b)” states and “SSI” states. In Gray Panthers it said: “States exercising the § 209(b) option were required to adopt a ‘spend down’ provision.” (453 U.S. at 39, n. 5, 101 S.Ct. at 2638, n. 5) Later, in Schweiker v. Hogan, 457 U.S. 569, 581, n. 18, 102 S.Ct. 2597, 2605, n. 18, 73 L.Ed.2d 227, 237, n. 18, the Supreme Court restated what it had said in Gray Panthers in this regard:
“Since recipients of categorical welfare assistance are also entitled to Medicaid benefits, the expansion of general welfare accomplished by the SSI program increased Medicaid obligations for some States. To guarantee that States would not, for that reason, withdraw from the Medicaid program, Congress offered what *273has become known as the ‘§ 209(b) option.’ Under it, States may elect to provide Medicaid assistance only to those individuals who would have been eligible under the state Medicaid plan in effect on January 1, 1972.... Thus, in some States, Medicaid is not automatically available for all of the ‘categorically needy.’ ”
To summarize: (1) The Secretary, to whom the authority to interpret this statute was delegated under what the Supreme Court has characterized as an “exceptionally broad authority,” has consistently and does now assert that “§ 209(b)” states had absolutely valid authority prior to the effective date of Boren-Long to have their own transfer of assets rule in their plan of Medicaid assistance; (2) Congress was aware of this construction of the statute by the Secretary and implicitly approved of it as a proper application of what it intended by the 1972 amendment; (3) And, as I read Gray Panthers and Hogan, both, in my opinion, read the authority of the Secretary and the effect of the 1972 amendment as sustaining the right of “§ 209(b)” states, prior to the Boren-Long Amendment, to enforce a transfer of assets rule.
The majority, however, disagrees. It concedes, as I read the majority opinion, that Congress by the amendment of 1972 created two classes of participating states under the federal Medicaid program, i.e., the “§ 209(b)” class and the “SSI” class. It recognizes, I think, that Congress intended to make a distinction in what might be contained in the plan of the two classes: A “SSI” state was bound strictly to the limitations on benefits stated in the statute but a “§ 209(b)” state could be more flexible in its limitations on benefits, fixing its limitations or restrictions by what was a part of its plan, as approved by the Secretary, in effect on January 1, 1972. It is at this point, though, that the majority would add what I regard as an untenable qualification upon the right of a “§ 209(b)” state. Under its construction of the statute, a “§ 209(b)” state might not include in its plan any denial of participation in benefits in the plan which takes into account “resources” not “available” in hand to the applicant at the time of his application. This, it holds, is the inescapable result of § 1396a of the original statute. Under this construction, it would hold that, irrespective of whether a transfer of assets provision be deemed a standard of eligibility or an anti-fraud provision, such a provision was invalid prior to the enactment of Boren-Long.
I disagree with this strict and inflexible construction of the statute. I do not tarry over the exact identification of a transfer of assets provision as a standard of eligibility or as an anti-fraud provision. I would find the provision valid in either circumstance, even though I think it is more properly considered an anti-fraud provision. The suggestion that Fabula v. Buck, 598 F.2d 869 (4th Cir.1979) brands the provision with invalidity if deemed an anti-fraud statute is, I suggest, unsound. Fabula dealt with a “SSI” state and the Secretary had long ruled after the 1972 amendment that a “SSI” state, as contrasted with a “§ 209(b)” state, could not include a transfer of assets provision in its plan. We held in Fabula —and this was the rationale of the decision — that “these administrative interpretations [by the Secretary] are reasonable and consistent with the statute, and are entitled to be followed by the courts.” Id., at 873. But, in the case of a “§ 209(b)” state, on the other hand, the Secretary has equally consistently taken the position that a transfer of assets provision was, until the effective date of the Boren-Long Amendment, a valid part of the state plan. Accordingly, if we follow the rationale of Fabula, that ruling of the Secretary with reference to a “§ 209(b)” state such as Virginia is “entitled to be followed by the courts,” especially in the light of the rule of construction of the statute as stated by the Supreme Court in Gray Panthers. If, on the other hand, the provision is to be regarded as controlled by the term “available,” then the Secretary had the authority to include within the term “available” anything that could reasonably have been “deemed” “available” under the decision in Gray Panthers, which was decided subsequently to Fabula. I find *274nothing irrational in treating as a part of an applicant’s “resources,” assets which the applicant, in order to induce the Government to provide him with free medical attention on the representation that he was without “resources,” had transferred his property to his children without consideration. I perceive little difference between such assets so transferred and assets which have been concealed or sequestered; in either instance, I think it reasonable to regard the assets as “available.” Above and beyond this is the fact that, as already observed, under the 1972 amendment, Congress and the Secretary have both made a distinction between “SSI” states and “§ 209(b)” states but the majority opinion would, in disregard of that manifest purpose, eliminate that distinction.
I respectfully suggest, with all deference for the contrary views of the majority, that it (the majority), in declaring by its ruling that the rights of “§ 209(b)” and “SSI” states were identical in their limitations on benefits, is actually contradicting the representation made by Congress in its 1972 amendment that any provision limiting benefits which a state had in its plan in effect on January 1, 1972, would be permitted to continue if the state elected to become what was known as a “§ 209(b)” state. Frankly, I do not think Congress when it enacted the 1972 amendment, was engaging in a “shell game” of cleverly representing to states with transfer of assets provisions in their plans that they could, by exercising their option under § 209(b), continue to follow such provisions as were in effect in their participating plans on January 1, 1972, while concealing from them at the same time that such representation was valueless since its enforceability of the representation was invalid under the narrow construction of § 1396a, adopted by the majority. I repeat that it is my considered opinion that Congress, in its 1972 amendment, was telling in good faith any state whose existing participating plan had been approved by the Secretary as conforming with statutory standards that it could legally continue at its option to follow that plan, and it did not intend for any court in 1983 to invalidate provisions in a state plan which for more than a decade the Secretary, with the tacit approval of Congress, had found to be valid under the statute. Such action is, in effect, contrary to Congressional intent, as found in Gray Panthers that it was the Secretary and not the courts, to whom the Congress entrusted the authority to define the terms under the statute and to construe its provisions.
It follows that, under the above reasoning, I, unlike the majority would reverse the ruling of the District Court that the enforcement of Virginia’s transfer of assets provision in its plan of participation in the Medicaid program prior to the effective date of the Boren-Long Amendment was invalid. Such a result, which follows generally the reasoning in Synesael v. Ling, supra, would render inappropriate all the remedial provisions of the District Court’s judgment based on the assumed invalidity of the state’s transfer of assets provision in existence prior to the effective date of the Boren-Long Amendment. This would leave for decision the challenge to the Virginia transfer of assets provisions in its plan of participation, as amended to conform to the requirements of the Boren-Long Amendment. Such challenge presents the second issue in this appeal.
The second issue in this case is the validity of Virginia’s amended plan, as approved by the Secretary in compliance with the statute as amended. The District Court found such amended plan valid. The majority opinion finds it, in part, invalid. I again disagree. I would affirm the result on this issue reached by the District Court for the reasons assigned by it.
. Pub.L. No. 96-611, § 5, 94 Stat. 3567 (1980), codified at 42 U.S.C. §§ 1382b(c) and 1396a(j).
. In line with this recognition of the interpretative authority having a “legislative effect” vested in the Secretary, the Supreme Court in Gray Panthers held that “resources” which could be considered “available” to an applicant might be “deemed” to include “resources” which were “available” to the applicant’s spouse.
. The provision as of January 1, 1972, is set forth in the majority opinion in note 4.
. In Fabula v. Buck, 598 F.2d 869, 878 (4th Cir.1979), we said that the approval of a state plan would, in that case, be but “slightly persuasive” on the validity of the plan but it said that because, as we were careful to observe, such approval was “in the face of the agency’s clear statements to the contrary.” In this case, however, the Secretary has consistently taken the position that a “§ 209(b)” state might validly enforce a transfer of assets provision prior to the adoption of the Boren-Long Amendment. This “clear” action of the Secretary over a long period of time gives to the construction of the statute urged by the State and the Secretary considerable “persuasiveness” in this case.