Dill

The pivotal issue presented in this appeal is concerned with the treatment of a stepfather’s income in fixing the “liability” for a “medically needy family” under the California Medical Assistance Program, commonly known as Medi-Cal. A “liability” under that program, like a “deductible” in a private insurance policy, is that portion of the cost of medical care the medically needy family must first assume before Medi-Cal benefits are obtainable. (Cal. Admin. Code, tit. 22, § 50053.)

Briefly, under the Medi-Cal program, as implemented by chapter 7 of part 3 of division 9 of the Welfare and Institutions Code (§ 14000 et seq.), four separate groups of persons are eligible for Medi-Cal benefits. In the first group are persons who already are receiving or have been found eligible to receive aid under one of the categorical public assistance programs. 1 (Welf. & Inst. Code, § 14005.1.) In the second group are *795 persons who meet all of the conditions of eligibility foraid under one of the categorical public assistance programs but who have not applied for such assistance. (Welf. & Inst. Code, § 14005.2.) The third group includes persons who meet the income and resource…