Ensuring Program Uniformity at the Hearing and Appeals Council Levels of the Administrative Review Process

AGENCY:

Social Security Administration.

ACTION:

Notice of proposed rulemaking (NPRM).

SUMMARY:

We propose to revise our rules so that more of our procedures at the administrative law judge (ALJ) and Appeals Council levels of our administrative review process are consistent nationwide. We anticipate that these nationally consistent procedures will enable us to administer our disability programs more efficiently and better serve the public.

DATES:

To ensure that your comments are considered, we must receive them no later than August 11, 2016.

ADDRESSES:

You may submit comments by any one of three methods—Internet, fax, or mail. Do not submit the same comments multiple times or by more than one method. Regardless of which method you choose, please state that your comments refer to Docket No. SSA-2014-0052 so that we may associate your comments with the correct rule.

Caution: You should be careful to include in your comments only information that you wish to make publicly available. We strongly urge you not to include in your comments any personal information, such as Social Security numbers or medical information.

1. Internet: We strongly recommend that you submit your comments via the Internet. Please visit the Federal eRulemaking portal at http://www.regulations.gov. Use the “Search” function to find docket number SSA-2014-0052. The system will issue a tracking number to confirm your submission. You will not be able to view your comment immediately because we must post each comment manually. It may take up to a week for your comment to be viewable.

2. Fax: Fax comments to (410) 966-2830.

3. Mail: Mail your comments to the Office of Regulations and Reports Clearance, Social Security Administration, 3100 West High Rise Building, 6401 Security Boulevard, Baltimore, Maryland 21235-6401.

Comments are available for public viewing on the Federal eRulemaking portal at http://www.regulations.gov or in person, during regular business hours, by arranging with the contact person identified below.

FOR FURTHER INFORMATION CONTACT:

Maren Weight, Office of Appellate Operations, Social Security Administration, 5107 Leesburg Pike, Falls Church, VA 22041, (703) 605-7100. For information on eligibility or filing for benefits, call our national toll-free number, 1-800-772-1213 or TTY 1-800-325-0778, or visit our Internet site, Social Security Online, at http://www.socialsecurity.gov.

SUPPLEMENTARY INFORMATION:

We propose revisions to:

(1) The time-frame for notifying claimants of a hearing date;

(2) the information in our hearing notices;

(3) the period when we require claimants to inform us about or submit written evidence, written statements, objections to the issues, and subpoena requests;

(4) what constitutes the official record; and

(5) the manner in which the Appeals Council considers additional evidence.

Background

Over the last few years, we have revised many of our regulations to bolster program integrity and clarify our policy, procedures, and expectations. For example, on June 25, 2014, we made changes to when a claimant must object to appearing at a hearing by video teleconferencing. As another example, we published a final rule on March 20, 2015, that clarified a claimant's duty to inform us about or submit all evidence that relates to whether or not he or she is blind or disabled, subject to two exceptions for privileged communications. We made these and other changes specifically to strengthen the integrity of our programs.

As we explained in the final rule on March 20, 2015, “we believe program integrity requires us to obtain complete medical evidence (favorable or unfavorable) in disability claims.” Although that statement refers to medical evidence, we reiterate in this proposed rule that a complete evidentiary record is necessary for us to make an informed and accurate disability determination or decision, and bolsters program integrity by improving consistency in the adjudication of claims at all levels of the administrative review process. As we look ahead, we continue to evaluate our regulatory and sub-regulatory policies to assess where we can make changes to improve accuracy and efficiency in our administrative review processes. To that end, we are now proposing the changes outlined below.

As we discuss in detail below, we have now had time to implement helpful systems changes and review a study performed by the Administrative Conference of the United States (ACUS), in which ACUS evaluated available data and considered various internal and external stakeholder opinions about the impact of our Part 405 rules. We are also facing an unprecedented challenge in the workloads pending at our Office of Disability Adjudication and Review (ODAR). With more than a million people currently waiting for a hearing decision, we cannot afford to continue postponing hearing proceedings because the record is not complete at the time of the hearing. Facing this unprecedented workload challenge requires that we consider all options to ensure we have a complete evidentiary record, provide timely and accurate service, and improve how we perform all administrative tasks. We expect these proposed changes will help us accomplish all three objectives.

More specifically, in the last decade, we have made significant progress in modernizing our business processes for hearings-level cases and enhancing our use of technology. For example, we now process most disability claims electronically, which allows us to transfer workloads around the country more easily. In addition, we have established five National Hearing Centers (NHC) that process only electronic cases and conduct all hearings via video teleconferencing. The NHCs assist hearing offices that have larger workloads and longer wait times for hearings. Our ability to transfer cases electronically out of a region to an NHC, or to another hearing office with a smaller workload, allows us to serve claimants more efficiently.

As we have increased our use of electronic case files, we also had an opportunity to re-evaluate how we receive and process evidence. Previously, claimants and representatives would mail, fax, or hand-deliver evidence to us, and we would enter the evidence into the case file manually. While these options remain available, improvements in technology now permit claimants and representatives to submit evidence through our Electronic Records Express (ERE) system, which uploads evidence directly into the claimant's electronic case file. Many representatives have also registered to use the Appointed Representative Suite of Services (ARS), which allows them to remotely view the claimant's electronic case file online and verify in real time that we received evidence. Representatives who access the case file through ARS can also view all of the other evidence in the file to verify that the record is complete.

We are also improving how we receive electronic evidence from medical providers. Our Health Information Technology (HIT) program allows us to request and receive a claimant's medical records through an electronic submission. Although we currently use HIT in only a small number of cases, we anticipate that we will expand the HIT program and make use of other technological advances that will make it easier and faster for us to obtain medical records. We expect these enhancements in how we receive evidence will improve our efficiency and ensure consistency in processing claims at the hearings and Appeals Council levels of our administrative review process.

Our progress in the areas discussed above can be undermined if our rules are not nationally consistent. At the beginning of 2006, the hearings and Appeals Council levels of our administrative review process generally operated under nationally consistent rules, set forth in 20 CFR parts 404 and 416. However, on March 31, 2006, we published a final rule that implemented a number of changes to our disability determination process. These changes, which we referred to collectively as the Disability Service Improvement (DSI) process, were primarily set forth in Part 405 of our regulations. As we explained in the preamble to our final rule, we selected Boston as the first region to implement the DSI process. Over the last decade, we have revised or rescinded many portions of the Part 405 regulations. However, certain aspects of DSI processing remain at the hearings and Appeals Council levels.

For example, our current Part 405 rules require us to provide claimants with notice of their hearings at least 75 days in advance of the hearing. By contrast, our current Part 404 and Part 416 rules require us to provide claimants with notice of their hearings at least 20 days in advance of the hearing. In addition, under Part 405, claimants are required to submit any written evidence no later than 5 business days before the date of the scheduled hearing, with a few exceptions. Conversely, under Parts 404 and 416, claimants can submit evidence up to and on the date of the hearing, or even after a hearing. Additionally, Part 405 contains other processing differences, including the time limit of at least 10 days prior to the hearing to submit subpoena requests versus Parts 404 and 416, which contains a time limit of 5 days prior to the hearing to submit subpoena requests. Lastly, Part 405 requires the submission of objections to the issues at the hearing 5 days prior to the hearing versus Parts 404 and 416, which requires the submission of objections at the earliest possible opportunity.

There is also a difference in claims processing at the Appeals Council level due to the Part 405 rules, especially those that address when the Appeals Council considers additional evidence. Under Parts 404 and 416, the Appeals Council will consider new and material evidence only when it relates to the period on or before the date of the ALJ hearing decision. The Appeals Council will evaluate the entire record, including any new and material evidence that relates to the period on or before the date of the ALJ hearing decision. It will then review the case if it finds that the ALJ's action, findings, or conclusion is contrary to the weight of the evidence currently of record.

However, under Part 405, the Appeals Council will consider additional evidence only where it relates to the period on or before the date of the ALJ hearing decision, and only if the claimant shows that there is a reasonable probability that the evidence, alone or when considered with other evidence of record, would change the outcome of the decision; and: (1) Our action misled the claimant; (2) he or she had a physical, mental, educational, or linguistic limitation(s) that prevented him or her from submitting the evidence earlier; or (3) some other unusual, unexpected, or unavoidable circumstance beyond his or her control prevented him or her from submitting the evidence earlier.

We have always intended to implement nationally consistent rules after we had sufficient time to evaluate the effectiveness of DSI processing. To assist us in evaluating these issues, we asked ACUS to review the impact of our Part 405 regulations at the hearings and Appeals Council levels. Ultimately, in its final report, ACUS deferred to us regarding whether to implement the Part 405 regulations nationwide. However, ACUS suggested a variety of guiding principles and other observations for us to consider in making a decision regarding national uniformity. For example, ACUS suggested that we: (1) Strive to attain an appropriate balance between claimant and agency interests as we pursue our goal of making the right disability decision as early in the process as possible; (2) strive for consistency in the administration of a national program; (3) collect and assess more data about the DSI program; and (4) if pursued, clarify the guidance to ALJs and claimants about application of the DSI program. ACUS also observed that if we pursued regulatory changes similar to DSI, it would be important to retain appropriate good cause exceptions for the late submission of evidence.

After considering ACUS's suggestions, we first provided additional training to ODAR adjudicators and staff regarding the application of our Part 405 rules. We also incorporated instructions for processing cases originating in the Boston region into our training materials for all staff, including addressing Part 405 issues in several of our quarterly Videos-On-Demand series that focus on new or problematic areas of adjudication. We continue to update sub-regulatory policy to include references and instructions on how to process cases under Part 405. As recommended by ACUS, we made these changes to promote consistent adjudication of Part 405 in the Boston region.

We then carefully considered ACUS's findings on how we receive evidence under Part 405. In its report, ACUS explained that it performed a comparative empirical analysis of data that we provided, and its findings, while not definitive, appeared to show that the Part 405 rules made modest strides towards achieving our goal of improving the efficiency, accuracy, and timeliness of our disability adjudication process. While declining to draw definitive conclusions from its data analysis, ACUS highlighted several findings, including the following: (1) Under Part 405, there was less likelihood that adjudicators would determine the record needed additional evidence and request a consultative examination; (2) there were lower average processing times in the Boston region than other comparable regions, and the Boston region's average processing times did not exhibit the same comparative decline in average processing times found in other regions; and (3) the Boston region had the lowest pending disposition ratio, which suggests enhanced case efficiencies.

We note that several of ACUS's findings, based on the available data through 2012, are consistent with our experience. For example, ACUS stated that the “average time intervals between issuance of hearing notices and hearings have been rising steadily at both regional and national levels in recent years.” While Parts 404 and 416 require that we provide notice to a claimant of a scheduled hearing at least 20 days before the hearing, and Part 405 requires that we provide notice to a claimant of a scheduled hearing at least 75 days before the hearing, it has been our experience that for several years nationwide, most claimants received more advance notice of a hearing than the regulations require. Specifically, the Boston region appears to be scheduling hearings and notifying claimants approximately 90 days before the hearing while other regions are providing notice more than 60 days before the hearing. Additionally, we have also observed that, nationally, cases in which we sent notices approximately 60 days prior to the date of the hearing seem to have a reduced or the same likelihood of a postponed hearing as those scheduled with less notice of the hearing. In addition to our experience, we also considered ACUS's finding that there was strong support from stakeholders, both inside and outside of the agency, for increasing the amount of advance notice a claimant receives before a hearing.

We considered proposing to adopt a 75-day advance notice requirement nationwide. However, the information available to us indicates that there may be a higher incidence of postponements when we give claimants 75 days or more advance notice of a hearing due to the unavailability of the appointed representative or adjudicator on the date of the scheduled hearing. In contrast, we have observed that most hearing offices already schedule hearings 60 days in advance, and a 60-day advance notice period appears to have the same or a reduced incidence of postponements when compared to notice periods less than 60 days. Therefore, based on the available data, we propose a 60-day notice requirement as the most administratively efficient. Further, because we are already scheduling most hearings nationwide at least 60 days in advance, we do not expect that adopting this requirement would have an adverse impact on the public or on our operations. As noted by ACUS, the public seems to support increasing the number of days for advance notice of a hearing because, among other reasons, it will provide more time to obtain updated medical records before the date of the hearing. Therefore, we propose to require that, nationwide, we notify claimants of a scheduled hearing at least 60 days prior to the date of the hearing.

The highlights of ACUS's empirical analysis and our own experience also support adopting nationwide rules similar to the existing Part 405 rules that govern how we receive evidence in the Boston region. For example, our experience is that under Parts 404 and 416, some hearings are postponed or require supplemental proceedings due to late submission of evidence. We anticipate that our final rule on the “Submission of Evidence in Disability Claims,” discussed earlier, will decrease the number of Appeals Council remands based on additional evidence. However, our experience has shown, and we expect to continue to see, that the Appeals Council will need to remand some cases due to new evidence. The need to postpone and reschedule cases, along with Appeals Council remands based on new evidence that was available at the time of the hearing decision, costs us valuable resources and delays the adjudication of all claims at the hearings and Appeals Council levels.

In its report, ACUS also identified several concerns raised by stakeholders both inside and outside the agency with implementing Part 405 nationwide. For example, ACUS explained that both ALJs and claimants' representative groups agree that two of the most challenging obstacles to timely submission of evidence are: (1) Delays in receipt of evidence from medical providers, and (2) delays in receipt of evidence from the claimant. As previously discussed, we propose changing our rules so that we provide claimants with additional time to inform us about or to obtain and submit written evidence. In doing so, we will also change our notices to ensure claimants are advised of the additional time. To address concerns about delays in receiving evidence from medical providers, we propose to retain the current good cause exceptions used in Part 405. We also propose to add examples, including that we will accept evidence submitted less than 5 business days prior to the hearing if a claimant shows that he or she actively and diligently sought to obtain the evidence promptly, but could not do so.

Based in part on ACUS's evaluation of the good cause exceptions to the Part 405 rule that requires claimants to submit evidence at least 5 business days before a hearing, we propose to clarify when other unusual, unexpected, or unavoidable circumstances beyond the claimant's control prevent earlier identification of or submission of evidence. To accomplish this, we have added examples to illustrate when a claimant meets a good cause exception, such as when a claimant is seriously ill or when evidence is not received until less than 5 business days before the hearing, despite the claimant's active and diligent efforts to obtain the evidence earlier. These examples are not intended to be exhaustive or to illustrate every possible situation, but to illustrate the sorts of situations most likely to arise.

In addition to adding examples regarding the good cause requirements, we also explain that, when reviewing claims that are not based on an application for benefits, the requirement to submit evidence at least 5 business days before a hearing does not apply if our other regulations permit the submission of evidence after the date of an ALJ decision. For example, under current section 416.1476(b)(2) (proposed section 416.1470(b)), in reviewing decisions other than those based on an application for benefits, the Appeals Council will consider evidence in the hearing record and any additional evidence it believes is material to an issue being considered. Supplemental Security Income (SSI) cases under title XVI of the Act that are not based on an application for benefits are excepted from the general rules that limit the Appeals Council's consideration of additional evidence based on the individual's right to reestablish his or her eligibility for title XVI payments during the course of an appeal without filing a new application. Therefore, we added an exception to address this and similar situations where other regulations may permit the submission of evidence in claims that are not based on an application for benefits.

To ensure national consistency in our policy and procedures, we also propose requiring claimants to file written statements about the case, or any objections to the issues, at least 5 business days prior to a scheduled hearing. We further propose to require a claimant to submit subpoena requests at least 10 business days prior to a scheduled hearing. For consistency with these proposed changes, we also propose changes to our regulations to explain what constitutes the official record.

Our proposal that generally requires claimants to submit written evidence at least 5 business days before a hearing also requires that we propose revisions to how the Appeals Council will handle additional evidence it receives on appeal. Under the proposed rule, the Appeals Council would generally consider additional evidence only if it is new and material and relates to the period on or before the date of the hearing decision, and only if the claimant shows that he or she did not submit the evidence at the hearing level because: (1) Our action misled him or her; (2) he or she had a physical, mental, educational, or linguistic limitation(s) that prevented him or her from informing us about or submitting the evidence earlier; or (3) some other unusual, unexpected, or unavoidable circumstance beyond his or her control prevented him or her from informing us about or submitting the evidence earlier. If these requirements are satisfied, the Appeals Council would grant review if there is a reasonable probability that the evidence, alone or considered with the evidence of record, would change the outcome of the hearing level decision. For additional evidence that does not relate to the period on or before the ALJ decision, the Appeals Council would continue to notify the claimant that because of the new evidence, if he or she files a new application within a specified timeframe, the date of the claimant's request for review would constitute a written statement indicating an intent to claim benefits. This means that we would use the date of the claimant's request for Appeals Council review as the filing date for the new application, which we call a protective filing date. In addition to retaining this current practice, the Appeals Council would also provide a claimant with a protective filing date when it finds he or she did not have good cause for not submitting the evidence at the hearing level at least 5 business days before the hearing. Additionally, we also propose to clarify that the Appeals Council may conduct hearing proceedings to obtain additional evidence when needed.

In addition to creating greater uniformity in our procedures, we expect these changes will improve our ability to manage our workloads. Most importantly, we expect these changes to allow us to adjudicate cases and process workloads more efficiently and consistently, leading to better public service overall.

Because these proposed changes would bring the vast majority of Part 405 procedures in line with the procedures in Parts 404 and 416, we also propose to remove Part 405 in its entirety. In doing so, we acknowledge there are several sections in Part 405 that include minor language or substantive variances from Part 404 and Part 416 that we did not address above. For example, the requirements for showing good cause to extend a filing deadline are different under Part 405 from the ones we propose here. We intend that, other than the changes we propose in this NPRM, we are not proposing to adopt any of the other variances currently in Part 405.

Clarity of These Proposed Rules

Executive Order 12866, as supplemented by Executive Order 13563, requires each agency to write all rules in plain language. In addition to your substantive comments on this proposed rule, we invite your comments on how to make it easier to understand.

For example:

• Would more, but shorter, sections be better?
• Are the requirements in the rule clearly stated?
• Have we organized the material to suit your needs?
• Could we improve clarity by adding tables, lists, or diagrams?
• What else could we do to make the rule easier to understand?
• Does the rule contain technical language or jargon that is not clear?
• Would a different format make the rule easier to understand, e.g., grouping and order of sections, use of headings, paragraphing?

Regulatory Procedures

Executive Order 12866, as Supplemented by Executive Order 13563

We consulted with the Office of Management and Budget (OMB) and determined that this proposed rule meets the criteria for a significant regulatory action under Executive Order 12866, as supplemented by Executive Order 13563. Therefore, OMB reviewed it.

Regulatory Flexibility Act

We certify that this proposed rule would not have a significant economic impact on a substantial number of small entities because it affects individuals only. Therefore, a regulatory flexibility analysis is not required under the Regulatory Flexibility Act, as amended.

Paperwork Reduction Act

These proposed rules contain reporting requirements in the regulation sections §§ 404.929, 404.935, 404.939, 404.949, 404.950(2), 404.968, 416.1429, 416.1435, 416.1439, 416.1449, 416.1450 and 416.1468 that require OMB clearance under the Paperwork Reduction Act of 1995 (PRA). For sections 404.929, 404.949, 404.950(2), 416.1429, 416.1449, 416.1450(2) of these rules, we previously accounted for the public reporting burdens in the Information Collection Requests for OMB Numbers 0960-0269 and 0960-0710, which the public use to submit the information to SSA. Consequently, we are not reporting these sections. SSA will solicit public comment and will submit separate information collection requests to OMB in the future for regulations sections §§ 404.935, 404.939, 404.968, 416.1435, 416.1439, and 416.1468 as they require OMB clearance under the Paperwork Reduction Act of 1995 (PRA). We will not collect the information referenced in these burden sections until we receive OMB approval.

(Catalog of Federal Domestic Assistance Program Nos. 96.001, Social Security—Disability Insurance; 96.002, Social Security—Retirement Insurance; 96.004, Social Security—Survivors Insurance; and 96.006, Supplemental Security Income)

List of Subjects

20 CFR Part 404

• Administrative practice and procedure; Blind; Disability benefits; Old-age, survivors, and disability insurance; Reporting and recordkeeping requirements; Social Security

20 CFR Part 405

• Administrative practice and procedure; Blind; Disability benefits; Old-age, survivors, and disability insurance; Public assistance programs; Reporting and recordkeeping requirements; Social Security; Supplemental Security Income (SSI)

20 CFR Part 416

• Administrative practice and procedure; Aged
• Blind
• Disability benefits
• Public assistance programs; Reporting and recordkeeping requirements; Supplemental Security Income (SSI)

For the reasons set out in the preamble, we propose to amend 20 CFR chapter III parts 404, 405, and 416 as set forth below:

PART 404—FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE (1950- )

Subpart J—[Amended]

1. The authority citation for subpart J of part 404 continues to read as follows:

Authority: Secs. 201(j), 204(f), 205(a)-(b), (d)-(h), and (j), 221, 223(i), 225, and 702(a)(5) of the Social Security Act (42 U.S.C. 401(j), 404(f), 405(a)-(b), (d)-(h), and (j), 421, 423(i), 425, and 902(a)(5)); sec. 5, Pub. L. 97-455, 96 Stat. 2500 (42 U.S.C. 405 note); secs. 5, 6(c)-(e), and 15, Pub. L. 98-460, 98 Stat. 1802 (42 U.S.C. 421 note); sec. 202, Pub. L. 108-203, 118 Stat. 509 (42 U.S.C. 902 note).

2. In § 404.900, revise the second sentence of paragraph (b) to read as follows:

3. In § 404.929, revise the fifth sentence to read as follows:

4. Revise § 404.935 to read as follows:

5. In § 404.938, revise paragraphs (a) and (b) to read as follows:

6. Revise § 404.939 to read as follows:

7. Revise § 404.944 to read as follows:

8. Revise § 404.949 to read as follows:

9. In § 404.950, revise paragraphs (c) and (d) to read as follows:

10. Revise § 404.951 to read as follows:

11. In § 404.968, revise the second sentence of paragraph (a) introductory text to read as follows:

12. Revise § 404.970 to read as follows:

13. Revise § 404.976 to read as follows:

PART 405—[REMOVED AND RESERVED]

14. Under the authority of sections 205(a), 702(a)(5), and 1631(d)(1) of the Social Security Act, part 405 is removed and reserved.

PART 416—SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND DISABLED

Subpart N—Determinations, Administrative Review Process, and Reopening of Determinations and Decisions

15. The authority citation for subpart N of part 416 continues to read as follows:

Authority: Secs. 702(a)(5), 1631, and 1633 of the Social Security Act (42 U.S.C. 902(a)(5), 1383, and 1383b); sec. 202, Pub. L. 108-203, 118 Stat. 509 (42 U.S.C. 902 note).

16. In § 416.1400, revise the second sentence of paragraph (b) to read as follows:

17. In § 416.1429, revise the fifth sentence to read as follows:

18. Revise § 416.1435 to read as follows:

19. In § 416.1438, revise paragraphs (a) and (b) to read as follows:

20. Revise § 416.1439 to read as follows:

21. Revise § 416.1444 to read as follows:

22. Revise § 416.1449 to read as follows:

23. In § 416.1450, revise paragraphs (c) and (d) to read as follows:

24. Revise § 416.1451 to read as follows:

25. In § 416.1468, revise the second sentence of paragraph (a) to read as follows:

26. Revise § 416.1470 to read as follows:

27. Revise § 416.1476 to read as follows: