Opinion
No. 4:17-CV-8-D
01-23-2018
RANDALL McNEAL, Plaintiff, v. NANCY A. BERRYHILL, Acting Commissioner of Social Security, Defendant.
MEMORANDUM & RECOMMENDATION
This matter is before the court on the parties' cross motions for judgment on the pleadings pursuant to Rule 12(c) of the Federal Rules of Civil Procedure. Randall McNeal ("Plaintiff") filed this action pursuant to 42 U.S.C. § 405(g) seeking judicial review of the denial of his application for Supplemental Security Income (SSI). The time for filing responsive briefs has expired, and the pending motions are ripe for adjudication. Having carefully reviewed the administrative record and the motions and memoranda submitted by the parties, the undersigned recommends that Plaintiff's Motion for Judgment on the Pleadings [DE #15] be granted, Defendant's Motion for Judgment on the Pleadings [DE #17] be denied, and the Commissioner's decision be remanded for further proceedings.
STATEMENT OF THE CASE
Plaintiff applied for Disability Insurance Benefits (DIB) and SSI on August 9, 2013, with an alleged onset date of January 1, 2007. (R. 17, 184-89, 190-94.) The application was denied initially and upon reconsideration, and a request for hearing was filed. (R. 17, 68-69, 84-85, 136-37.) A video hearing was held on April 28, 2016, before Administrative Law Judge (ALJ) James F. Barter, who issued an unfavorable ruling on July 6, 2015. (R. 17, 27.) The Appeals Council denied Plaintiff's request for review on August 15, 2016. (R. 1.) Plaintiff seeks judicial review of the final administrative decision pursuant to 42 U.S.C. § 405(g).
Plaintiff subsequently amended the alleged onset date to August 9, 2013, and waived his application for DIB. (R. 37.)
DISCUSSION
I. Standard of Review
The scope of judicial review of a final agency decision denying disability benefits is limited to determining whether substantial evidence supports the Commissioner's factual findings and whether the decision was reached through the application of the correct legal standards. See Coffman v. Bowen, 829 F.2d 514, 517 (4th Cir. 1987). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion; [i]t consists of more than a mere scintilla of evidence but may be somewhat less than a preponderance." Craig v. Chater, 76 F.3d 585, 589 (4th Cir. 1996) (first quoting Richardson v. Perales, 402 U.S. 389, 401 (1971); then quoting Laws v. Celebrezze, 368 F.2d 640, 642 (4th Cir. 1966)) (citations omitted) (alteration in original). "In reviewing for substantial evidence, [the court should not] undertake to re-weigh conflicting evidence, make credibility determinations, or substitute [its] judgment for that of the [Commissioner]." Mastro v. Apfel, 270 F.3d 171, 176 (4th Cir. 2001) (quoting Craig, 76 F.3d at 589) (first and second alterations in original). Rather, in conducting the "substantial evidence" inquiry, the court determines whether the Commissioner has considered all relevant evidence and sufficiently explained the weight accorded to the evidence. Sterling Smokeless Coal Co. v. Akers, 131 F.3d 438, 439-40 (4th Cir. 1997).
II. Disability Determination
In making a disability determination, the Commissioner utilizes a five-step evaluation process. The Commissioner asks, sequentially, whether the claimant: (1) is engaged in substantial gainful activity; (2) has a severe impairment; (3) has an impairment that meets or equals the requirements of an impairment listed in 20 C.F.R. Part 404, Subpart P, App. 1; (4) can perform the requirements of past work; and, if not, (5) based on the claimant's age, work experience, and residual functional capacity can adjust to other work that exists in significant numbers in the national economy. See 20 C.F.R. § 416.920(a)(4); Albright v. Comm'r of Soc. Sec. Admin., 174 F.3d 473, 475 n.2 (4th Cir. 1999). The burden of proof and production during the first four steps of the inquiry rests on the claimant. Pass v. Chater, 65 F.3d 1200, 1203 (4th. Cir. 1995). At the fifth step, the burden shifts to the Commissioner to show that other work exists in the national economy that the claimant can perform. Id.
III. ALJ's Findings
Applying the five-step, sequential evaluation process, the ALJ found Plaintiff "not disabled" as defined in the Social Security Act. At step one, the ALJ found Plaintiff had not engaged in substantial gainful employment since August 9, 2013, the alleged onset date. (R. 19.) Next, the ALJ determined Plaintiff had the following severe impairments: "chronic kidney disease stage II; bilateral bunion; [and] paresthesia of feet." (Id.) The ALJ also found Plaintiff's prior substance abuse to be a non-severe impairment. (R. 19-20.)
At step three, the ALJ concluded that Plaintiff's impairments were not severe enough, either individually or in combination, to meet or medically equal one of the listed impairments in 20 C.F.R. Part 404, Subpart P, Appendix 1. (R. 21.) The ALJ stated that he considered all listings and explicitly analyzed Listings 5.00 and 6.00. (Id.)
Prior to proceeding to step four, the ALJ assessed Plaintiff's residual functional capacity (RFC) and found that Plaintiff had
the residual functional capacity to perform medium work as defined in 20 CFR 404.1567(c) and 416.967(c) except that [Plaintiff] can only occasionally climb stairs, ladders, ropes, and scaffolds and occasionally stoop, kneel, crouch, or crawl.(R. 21.) In making this assessment, the ALJ found Plaintiff's statements about the severity of his symptoms "not entirely consistent" with the evidence in the record. (R. 22.) At step four, the ALJ concluded Plaintiff was able to perform his past relevant work as a building maintenance repair worker. (R. 26-27.) The ALJ did not proceed to step five because he found that Plaintiff could perform past relevant work at step four.
IV. Plaintiff's Argument
Plaintiff contends that remand is required because the ALJ failed to discuss a stage agency Medicaid decision which found Plaintiff disabled, thereby violating SSR 06-03p and Bird v. Comm'r of Soc. Sec. Admin., 699 F.3d 337, 343 (4th Cir. 2012). (Pl.'s Mem. Supp. Mot. J. Pldgs. [DE #16] at 5-6.) The Commissioner argues, despite the ALJ's failure to reference the Medicaid decision and explain the weight assigned to it, this error was harmless because other evidence in the record rendered the Medicaid decision "of little consequence to the ALJ's well-reasoned analysis." (Def.'s Mem. Supp. Mot. J. Pldgs. [DE #18] at 5-6.)
A federal court reviewing an agency action is only permitted to evaluate the reasons invoked by the agency in its final decision and, in a Social Security matter, "cannot supplement the ALJ's explanation with the Commissioner's legal arguments." Ware v. Astrue, No. 5:11-CV-446-D, 2012 WL 6645000, at *3 (E.D.N.C. Dec. 20, 2012) (citing SEC v. Chenery, 332 U.S. 194, 196 (1947), and Hilton v. Astrue, C/A No. 6:10-2012-CMC, 2011 WL 5869704, at *3 n.3 (D.S.C. Nov. 21, 2011)).
SSR 06-03p requires an ALJ to "explain the consideration given to [other governmental and nongovernmental disability] decisions in the notice of decision." SSR 06-3p, 2006 WL 2329939, at *7 (Aug. 9, 2006) (emphasis added).
The Commissioner recently rescinded SSR 06-03p for claims filed on or after March 27, 2017, declaring that "decisions from other governmental agencies and nongovernmental entities . . . [are] inherently neither valuable nor persuasive to [the Commissioner]." 82 Fed. Reg. 15,263 (Mar. 27, 2017). This ruling was in effect at the time of the ALJ's decision and thus remains applicable on review. See Cook, 783 F.2d at 1171-72; see also 81 Fed. Reg. 66,138 n.1 (Sept. 26, 2016) (noting that federal judicial review should apply the regulations in effect at the time of the final agency decision). --------
More than two decades before the issuance of SSR 06-03p, the Fourth Circuit held that "the disability determination of a state agency is entitled to consideration by the [Commissioner]." DeLoatche v. Heckler, 715 F.2d 148, 150 n.1 (4th Cir. 1983). The Fourth Circuit reiterated this point in Bird, 699 F.3d at 343, and rulings from this court have made clear that SSR 06-03p requires an ALJ to say something about another governmental agency's disability decision, particularly a decision that applies the Commissioner's regulations. See, e.g., Walton v. Astrue, No. 7:09-CV-112-D, 2010 WL 2772498, at *1 (E.D.N.C. July 9, 2010) ("The problem, however, is that the ALJ said nothing, and SSR 06-3p requires more than 'nothing.'"); Batchelor v. Colvin, 962 F. Supp. 2d 864, 867 (E.D.N.C. 2013) ("This court has repeatedly held that where an ALJ fails to mention disability determinations by other governmental agencies, this constitutes error necessitating remand to the Commissioner for further consideration and explanation."). Other district courts within the Fourth Circuit have reached a similar conclusion. See, e.g., Chriscoe v. Colvin, No. 1:13-CV-788, 2015 WL 4112442, at *4-5 (M.D.N.C. July 8, 2015), memorandum and recommendation adopted by ECF No. 20 (Aug. 6, 2015); Gaskins v. Colvin, No. 3:12-CV-81, 2013 WL 3148717, at *3-4 (N.D.W. Va. June 19, 2013).
There is, however, some debate among the courts with respect to the extent of analysis due other agency disability determinations. For example, the Western District of North Carolina has held that "a statement by the ALJ that he considered opinion evidence in accordance with SSR 06-03p is a sufficiently adequate consideration of [a] prior Medicaid determination" where "the prior Medicaid decision was the only opinion evidence in the record that would implicate consideration under SSR 06-03p." Gabriel v. Colvin, No. 1:14-CV-270-FDW, 2015 WL 4591591, at *3-4 (W.D.N.C. July 29, 2015). And the sufficiency of an ALJ's cursory reference to a prior disability determination, without any case-specific reasons, is an issue currently before the Fourth Circuit in another case that is tentatively scheduled for oral argument in March 2018. See Woods v. Berryhill, No. 17-1500 (4th Cir. filed Apr. 18, 2017). The briefs in Woods (ECF Nos. 8, 14, 16) illuminate the disagreement within the district courts of the Fourth Circuit regarding DeLoatche, Bird, SSR 06-03p, and the amount of consideration the Commissioner must give state agency disability determinations.
The court need not reach the issue presented in Woods, however. Here, the North Carolina Department of Health and Human Services awarded Plaintiff Medicaid based upon application of the Social Security Administration's Medical-Vocational Guideline Rule 201.14. (R. 254-55), and Plaintiff's attorney specifically highlighted this state agency disability determination during the administrative hearing before the ALJ (R. 39). Yet nowhere in his decision does the ALJ mention, even cursorily, the state Medicaid decision. (R. 17-27.)
The Commissioner makes two arguments that this error was harmless: (1) that the ALJ's decision thoroughly explained and relied on evidence submitted after the Medicaid decision tending to show that Plaintiff was not disabled, which vitiated any probative value of the state Medicaid decision (Def.'s Mem. Supp. Mot. J. Pldgs. at 6-7), and (2) that the ALJ's awareness of the state Medicaid decision and choice not to discuss it in his written opinion entails that it was considered and determined to be without probative value (id. at 4, 8).
The first argument has some appeal, as the record indicates that the ALJ received and relied on evidence post-dating the state Medicaid decision. (R. 23-25.) And Plaintiff does not argue why it was inappropriate for the ALJ to rely on that evidence or how he believes the outcome would be different on remand. (Pl.'s Mem. Supp. Mot. J. Pldgs. at 5-6.) On the other hand, the ALJ did not clarify whether the state Medicaid decision relied upon any evidence that was not part of the administrative record in the Social Security matter. Cf. Gaskins, 2013 WL 3148717, at *4 (finding an ALJ's failure to consider a state Medicaid decision was not harmless error because the court "[could not] determine whether the ALJ considered and discounted the same evidence on which the [state] Medicaid decision was based"). It is impossible to determine whether the ALJ's rationale is that offered by the Commissioner on review because the ALJ did not say anything about the state Medicaid decision. See DeLoatche, 715 F.2d at 150; Walton, 2010 WL 277249, at *1. "It may be, of course, as the [Commissioner] suggests on appeal, that the ALJ considered all of these factors and proposed to himself cogent reasons for disregarding them. However, on this record we cannot so determine." DeLoatche, 715 F.2d at 150.
The second argument asks this court to determine that the ALJ implicitly considered and rejected the state Medicaid decision because he knew about it and chose not to mention it. In addition to the gap-filling problem described above, the Fourth Circuit, albeit in an unpublished opinion, has recently cautioned against crediting "implicit rejections" of evidence by an ALJ. See Ezzell v. Berryhill, 688 F. App'x 199, 201 (4th Cir. 2017) (per curiam) (unpublished). The undersigned is not inclined to credit any such implicit rejection here.
In sum, the ALJ failed to explain whether he had considered a state agency disability determination that found Plaintiff to be disabled through application of Social Security regulations. The ALJ did this despite being made aware of this state agency decision. The Fourth Circuit and this court have previously held that such error warrants remand to give the Commissioner the opportunity to offer such an explanation. See DeLoatche, 715 F.2d at 150 & n.1; Batchelor, 962 F. Supp. 2d at 867. The rationale, however potent, offered by the Commissioner now cannot rectify the ALJ's error. See DeLoatche, 715 F.2d at 150.
CONCLUSION
For the reasons stated above, it is RECOMMENDED that Plaintiff's Motion for Judgment on the Pleadings [DE #15] be GRANTED, Defendant's Motion for Judgment on the Pleadings [DE #17] be DENIED, and the Commissioner's decision be remanded for further proceedings.
IT IS DIRECTED that a copy of this Memorandum and Recommendation be served on each of the parties or, if represented, their counsel. Each party shall have until February 6, 2018, to file written objections to the Memorandum and Recommendation. The presiding district judge must conduct his or her own review (that is, make a de novo determination) of those portions of the Memorandum and Recommendation to which objection is properly made and may accept, reject, or modify the determinations in the Memorandum and Recommendation; receive further evidence; or return the matter to the magistrate judge with instructions. See, e.g., 28 U.S.C. § 636(b)(l); Fed. R. Civ. P. 72(b)(3); Local Civ. R. 1.1 (permitting modification of deadlines specified in local rules), 72.4(b), E.D.N.C.
A party that does not file written objections to the Memorandum and Recommendation by the foregoing deadline, will be giving up the right to review of the Memorandum and Recommendation by the presiding district judge as described above, and the presiding district judge may enter an order or judgment based on the Memorandum and Recommendation without such review. In addition, a party's failure to file written objections by the foregoing deadline may bar the party from appealing to the Court of Appeals from an order or judgment of the presiding district judge based on the Memorandum and Recommendation. See Wright v. Collins, 766 F.2d 841, 846-47 (4th Cir. 1985).
This 23rd day of January 2018.
/s/_________
KIMBERLY A. SWANK
United States Magistrate Judge