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Last updated February 28, 2003 Social Security Disability Case Law: Does it Matter? By Eric Schnaufer Administrative law judges (ALJs) in the Office of Hearings and Appeals (OHA) of the Social Security Administration (SSA) adjudicate annually roughly four hundred thousand claims of disability under Titles II and XVI of the Social Security Act. Social Security Advisory Board, Disability Decision Making: Data and Materials (Jan. 2001), at Chart 67, at http://www.ssab.gov/chartbookB.pdf. Claimants have a right to judicial review of the final decisions of the Commissioner of Social Security denying claims of disability. 42 U.S.C. § 405(g). There are more than 15,000 civil actions annually challenging the Commissioner's administrative decisions denying claims of disability. Office of Human Resources and Statistics, Administrative Office of the United States Courts, Federal Judicial Caseload Statistics (Mar. 2002), Table C3, at http://www.uscourts.gov/caseload2002/contents.html. About 700 district-court dispositions annually are appealed to the courts of appeals. Id. at Table B7. Of these roughly 700 appellate cases, few are published, and thus few are precedential. In 2002, there were about 30 precedential appellate cases pertaining to the adjudication of claims of disability by SSA ALJs. This article asks whether those cases matter. [Begin footnote] Supreme Court precedent does, of course, matter. In 2002, the Supreme Court decided a single case pertaining to the adjudication of claims of disability under Titles II and XVI of the Social Security Act. See Barnhart v. Walton, 535 U.S. 212, 122 S. Ct. 1265 (2002). The Supreme Court also decided a case concerning attorney fees for representing a Title II plaintiff in civil litigation. See Gisbrecht v. Barnhart, 535 U.S. 789 (2002). [End footnote] The Commissioner has an official position regarding whether precedential appellate cases about the federal disability programs matter. See 20 C.F.R. § 404.985 (2002) [Footnote omitted]; 63 Fed. Reg. 24,927-32 (1998) (final rules at 20 C.F.R. § 404.985 with comments). If appellate precedent is contrary to the Commissioner's “interpretation of a provision of the Social Security Act or regulations” and if the Commissioner is unable to overturn that precedent through litigation, the Commissioner will issue an Acquiescence Ruling (AR) describing the Commissioner's disagreement with the precedent and ordering Agency adjudicators within the relevant Circuit to apply the precedent according to the instructions in the AR. 20 C.F.R. § 404.985(b) (2002); Social Security Ruling (SSR) 96-1p. The Commissioner has promised to issue an AR within 120 days of her receipt of an adverse appellate decision. 20 C.F.R. § 404.985(b)(1) (2002). There are currently in effect forty ARs. See http://www.ssa.gov/OP_Home/rulings/. Apparently according to the Commissioner, a single appellate case in 2002 would warrant an AR. In Thomas v. Commissioner of Social Security, 294 F.3d 568 (3d Cir. 2002), the Third Circuit en banc held that if a claimant shows that the claimant's past relevant job is obsolete, the claimant cannot be found “not disabled” at step four of the five-step sequential evaluation, see 20 C.F.R. § 404.1520(e) (2002) (step four), based on her ability to do that obsolete job. Thomas, 294 F.3d at 572-76. On February 24, 2003, the Supreme Court granted the Commissioner's petition for a writ of certiorari to review Thomas. Id., cert. granted, 71 U.S.L.W. 3390 (U.S. Feb. 24, 2003) (No. 02-763). Is it true that the Third Circuit's Thomas decision is the only appellate precedent from 2002 warranting an ALJ's consideration? [Begin footnote] In theory, the Commissioner could issue an AR for an appellate case decided in 2002 other than Thomas. The author does not expect the Commissioner to do so. [End footnote] Perhaps yes, if the standard is the Commissioner's view of adverse appellate precedent: As discussed in the preamble to the 1990 acquiescence regulations, the vast majority of adverse circuit court decisions do not conflict with our interpretation of the Act and regulations; they are based either on the issue of whether substantial evidence supports SSA's final administrative decision or on the issue of whether the final administrative decision adheres to established agency rules . . . . 63 Fed. Reg. 24,930 (1998) (internal citation omitted) (comments on final rules at 20 C.F.R. § 404.985). The Commissioner correctly maintains that much appellate precedent does not include identifiable legal rules but merely or mostly reaches fact-specific results on substantial-evidence review. See, e.g., Johansen v. Barnhart, 314 F.3d 283 (7th Cir. 2002); Bowman v. Barnhart, 310 F.3d 1080 (8th Cir. 2002); Masterson v. Barnhart, 309 F.3d 267 (5th Cir. 2002); Dolph v. Barnhart, 308 F.3d 876 (8th Cir. 2002); Krogmeier v. Barnhart, 294 F.3d 1019 (8th Cir. 2002); Ramirez v. Barnhart, 292 F.3d 576 (8th Cir. 2002); Estes v. Barnhart, 275 F.3d 722 (8th Cir. 2002). Other than Thomas, no appellate case in 2002 invalidated or overturned the Commissioner's interpretation of the Social Security Act or its implementing regulations. But while there was no decision similar to Thomas in its gravity for the adjudication of disability claims, there were decisions in 2002 to which the Commissioner did not acquiesce but to which the Commissioner arguably should have acquiesced in order to conform administrative decisionmaking to appellate precedent. [Begin footnote] The focus of this article is on the Commissioner's adherence to appellate precedent. There is a related issue of judicial respect for the Commissioner's rulemaking authority. On a regular basis, appellate courts announce legal rules without asking two fundamental questions: what is the agency's own rule and is that rule valid? See Walton, 122 S. Ct. at 1269 (asking the fundamental questions). For example, in Waters v. Barnhart, 276 F.3d 716 (5th Cir. 2002), the Fifth Circuit analyzed the issue of whether the five-step or eight-step sequential evaluation applied when a claimant is found disabled for a closed period of disability as though the issue were a question primarily of case law and as though the court had the freedom to select the best rule. Id. at 718-20. On the contrary, the Fifth Circuit should have held that the eight-step sequential evaluation applied because the Commissioner's policy says that it applies and because the Commissioner's policy is indisputably valid. See SSR 00-3p; see also SSR 02-1p (superseding SSR 00-3p). Instead, the Fifth Circuit mentioned only in passing that according to the Commissioner the eight-step sequential evaluation applied. Id. at 719 n.2; see also Crowley v. Apfel, 197 F.3d 194, 198 (5th Cir. 1999) (holding that incontinence “may be an impairment for purposes of the Social Security Act” as if it were for the Fifth Circuit to make such a determination). [End footnote] Appellate precedent should matter to SSA ALJs even if that precedent does not warrant the issuance of an AR. In fact, if an ALJ ignored all appellate precedent from 2002 other than Thomas, the ALJ might overlook important authority necessary to render a decision in conformity with relevant Circuit precedent. For many reasons, an ALJ may be motivated to conform his or her decisionmaking to appellate precedent construed more broadly than the constricted view of appellate precedent in 20 C.F.R. § 404.985 (2002). An ALJ may be motivated by professionalism. An ALJ may desire to render legally-correct decisions judged by the standard of the relevant Court of Appeals, not by the lower standard set by the Commissioner's policymakers. Or, an ALJ may intend to render a decision that has a greater chance of being affirmed on judicial review than it otherwise would if only the Commissioner's constricted view of appellate precedent were followed. Reviewed below are several examples of appellate precedent from 2002 not recognized by the Commissioner through an AR but that nonetheless should inform an ALJ's decisionmaking. [Begin footnote] Identifying and adhering to appellate precedent does not require a significant effort in terms of identifying the case law. Even in the Circuit with the most appellate precedent in 2002 — the Eighth Circuit — there was fewer than one published appellate case per month relating to the adjudication of disability under the Social Security Act. [End footnote] There are clear Circuit rules with which the Commissioner disagrees but for which the Commissioner has not issued ARs. In McCartey v. Massanari, 298 F.3d 1072 (9th Cir. 2002), the claimant received benefits from the Veterans Administration (VA) based on a disability. Id. at 1073. The ALJ denied benefits at step five, see 20 C.F.R. § 404.1520(f) (2002) (step five), without mentioning the VA disability rating. McCartey, 298 F.3d at 1075. The claimant argued in litigation that the ALJ did not give sufficient weight to the VA disability rating. Id. at 1074-76. The Ninth Circuit acknowledged the regulation that provides that a determination by an agency other than SSA (such as the VA) is not binding on an SSA adjudicator. Id. at 1076 (citing 20 C.F.R. § 404.1504 (2002)). But the Ninth Circuit also adopted three rules regarding the weight owed to a VA rating. First, an adjudicator must “consider” a VA rating. Id. Second, an adjudicator “must ordinarily give great weight to a VA determination of disability.” Id. And third, an adjudicator “may give less weight to a VA disability rating if he gives persuasive, specific, valid reasons for doing so that are supported by the record.” Id. The Commissioner should agree with the first rule; the Commissioner mostly requires consideration of all evidence. See, e.g., 20 C.F.R. § 404.1545 (2002). Yet, the Commissioner does not accept the second and third rules — that a determination from another agency is owed particular weight and that an adjudicator must justify expressly why a VA determination is not owed great weight. McCartey is thus an example of appellate precedent contrary to the Commissioner's interpretation of a regulation — 20 C.F.R. § 404.1504 (2002) — for which the Commissioner has neither issued an AR nor is likely to issue an AR. [Begin footnote] The Commissioner has not issued ARs for cases upon which the Ninth Circuit relied in McCartey to hold that a VA disability determination is ordinarily owed great weight. See Chambliss v. Massanari, 269 F.3d 520, 522 (5th Cir. 2001); Brady v. Heckler, 724 F.2d 914, 921 (11th Cir. 1984); DeLoatche v. Heckler, 715 F.2d 148, 150 n.1 (4th Cir. 1983). [End footnote] Besides including an articulation rule, McCartey contains a rule about the substantive weight owed to particular evidence. Other appellate precedent from 2002 also imposes an articulation rule on adjudicators. The Commissioner disagrees with this appellate precedent but has not and will not issue an AR for this precedent. In Watson v. Barnhart, 288 F.3d 212 (5th Cir. 2002), the claimant argued to the Fifth Circuit that the ALJ failed to make an express finding that the claimant could “maintain” employment. Id. at 217 (citing Singletary v. Bowen, 798 F.2d 818 (5th Cir. 1986)). The Fifth Circuit agreed that the “ALJ erred in failing to determine whether [the claimant] was capable not only of obtaining employment, but also maintaining it,” and remanded the case for further administrative proceedings to make that necessary finding. Id. at 218. The Commissioner disagrees with the Watson court's position that an adjudicator must make a separate and distinct finding that a claimant is able to “maintain” employment, but has not instructed her adjudicators in an AR to make the finding that Watson requires. (Nor has the Commissioner issued an AR for Singletary upon which Watson relies.) Thus, if an adjudicator followed the cases only for which the Commissioner has issued ARs, the adjudicator might omit the express finding that Watson requires. An adjudicator intending to draft a legally-defensible decision should make the finding that Watson requires even in the absence of an AR. [Begin footnote] Although the rule of Watson is clear, the Commissioner's litigation counsel currently argue that Watson does not require an explicit finding about maintaining employment and/or that an adjudicator implicitly made the finding that Watson requires. Watson is precisely the type of case that the Commissioner wants her adjudicators to ignore and her litigators to attack. Cf. Peter J. Rooney, Note, Nonacquiescence by the Securities and Exchange Commission: Its Relevance to the Nonacquiescence Debate, 140 U. Pa. L. Rev. 1111, 1112 (1990) (“Informal nonacquiescence is exemplified by agency disregard of judicial precedents or attempts to identify factual distinctions while giving the appearance of compliance with precedent.”). [End footnote] Another type of appellate precedent with which the Commissioner disagrees, but for which the Commissioner will not issue an AR, concerns evidentiary rules detached from any particular statutory provision or regulation. The Sixth Circuit's decision in Howard v. Commissioner of Social Security, 276 F.3d 235 (6th Cir. 2002), is an example of such precedent. The ALJ in Howard reached step five and needed vocational-expert testimony to support a finding of non-disability. Id. at 238. In order for a vocational expert's testimony to constitute substantial evidence for a finding of non-disability, the hypothetical question must be accurate. Varley v. Secretary of Health and Human Servs., 820 F.2d 777, 779 (6th Cir. 1987). The Howard court held that the ALJ's hypothetical question was inaccurate because the question did not include information about Howard's precise medical diagnoses: “degenerative disc disease, iron deficiency anemia, hypertension, and osteoarthritis.” Howard, 276 F.3d at 241. In a petition for rehearing, the Commissioner disagreed with this holding because a hypothetical question must reflect a claimant's functional limitations, not the medical cause for the functional limitations. A vocational expert is not responsible for translating medical diagnoses into functional limitations. Instead, a vocational expert identifies jobs in response to particular functional limitations. The Sixth Circuit, however, denied the Commissioner's petition for rehearing. Despite the fact that in her petition for rehearing the Commissioner described why Howard is wrong, the Commissioner did not issue an AR for Howard after her petition was denied. Should an adjudicator within the Sixth Circuit follow Howard's rule requiring the inclusion of diagnoses in a hypothetical question? Probably not. Howard's rule is clearly incorrect. Further, neither the district courts within the Sixth Circuit nor the Sixth Circuit itself is likely to require compliance with Howard's rule. Thus, Howard is an example of appellate precedent for which the Commissioner's nonacquiesce is arguably not only understandable but also reasonable. Some
appellate precedent raises a profound jurisprudential question.
In some circuits, the appellate courts purport to apply appellate
precedent regarding the adjudication of disability claims without addressing the
relationship between such case law precedent and the Commissioner's legal
authority, i.e., regulations and sub-regulatory policy statements.
The jurisprudential question is whether the appellate precedent should be
applied even if that precedent does not correspond to the Commissioner's
indisputably valid legal authority. [Begin footnote] The appellate precedent could be either more favorable or less favorable to claimants than the Commissioner's own authority. Whether the Commissioner should comply with appellate precedent less favorable to claimants than the Commissioner's own authority is a political question. If Congress believes that the Commissioner's own rules are too favorable to claimants, Congress could amend the statute or otherwise convince the Commissioner to modify her rules [End footnote] Ninth Circuit law provides perhaps the clearest examples of appellate precedent in tension with the Commissioner's indisputably valid rules. On November 14, 1991, the Commissioner issued detailed regulations for the evaluation of symptoms and credibility. See 56 Fed. Reg. 57,941 (1991); 20 C.F.R. § 404.1529 (2002) (codifying, in part, the November 14, 1991 regulations as amended); see also SSR 96-7p (clarifying the November 1991 regulations); SSR 96-8p (same). Apart from the August 1991 regulations and their related July 1996 SSRs, the Ninth Circuit has its own rules regarding the evaluation of a claimant's symptoms and credibility. According to the Ninth Circuit, in specific factual circumstances, an adjudicator “may reject the claimant's testimony regarding the severity of [his or] her symptoms only if [the adjudicator] makes specific findings stating clear and convincing reasons for doing so.” Smolen v. Chater, 80 F.3d 1273, 1283-84 (9th Cir. 1996). The Ninth Circuit's requirement for clear and convincing reasons, in theory and in practice, places a greater burden on an adjudicator than the 1991 regulations and clarifying 1996 rulings describe. Despite this, the Commissioner has not issued an AR for Smolen or other applications of Ninth Circuit law about symptoms and credibility consistent with Smolen. See, e.g., Moore v. Commissioner of Social Security Admin., 278 F.3d 920, 924 (9th Cir. 2002) (“The clear and convincing standard is the most demanding required in Social Security cases.”). [Begin footnote] Nearly identical concerns arise from Ninth Circuit law regarding the evaluation of medical opinions, including opinions from treating sources. Compare 20 C.F.R. § 404.1527 (2002) (codifying, in part, the August 1, 1991 regulations as amended); 56 Fed. Reg. 6,960 (1991); SSR 96-6p (clarifying the 1991 regulations); SSR 96-5p (same); SSR 96-2p (same), with Lester v. Chater, 81 F.3d 821, 830 (9th Cir. 1995) (requiring, in certain instances, clear and convincing reasons to reject a treating source's opinion). Some recent Ninth Circuit cases point to a fusion of Ninth Circuit case law, the regulations, and the rulings with respect to weighing medical opinions. See, e.g., Edlund v. Massanari, 253 F.3d 1152, 1157 (9th Cir. 2001) (citing regulations and case law); Holohan v. Massanari, 246 F.3d 1195, 1202 (9th Cir. 2001) (citing regulations, a ruling, and case law). [End footnote] When the Commissioner does not issue an AR, the Commissioner does not explain why. Explaining why an AR was not issued would be “inefficient and costly.” 63 Fed. Reg. 24,929 (1998) (comment on final rules at 20 C.F.R. § 404.985). Therefore, one can only guess how the Commissioner rationalizes not issuing an AR for Smolen. The Commissioner might maintain that Smolen's rule only applies on judicial review. In other words, the Commissioner might assert that Smolen does not direct all adjudicators within the Ninth Circuit to provide clear and convincing reasons for rejecting a claimant's statements, but only ascertains whether adjudicators whose decisions are challenged on judicial review provided such clear and convincing reasons. (It is doubtful whether the Ninth Circuit would agree that the scope of its precedent is so narrow.) Or the Commissioner might suggest that the Ninth Circuit's requirement for clear and convincing reasons is not significantly different from what the Commissioner herself requires through 20 C.F.R. § 404.1529 (2002), SSR 96-7p, and SSR 96-8p. Speculations aside, an individual ALJ is faced daily with the choice to apply appellate precedent such as Smolen for which the Commissioner has not issued an AR. The Appeals Council is very unlikely to find that an ALJ's failure to cite or follow Smolen constitutes legal error. And the Appeals Council is unlikely to find that an ALJ's citation of Smolen or express adherence to Smolen constitutes legal error. [Begin footnote] The author is unaware of the Appeals Council taking own-motion review or granting a claimant's request for review of an ALJ's decision on the ground that the ALJ followed appellate precedent from the relevant Circuit more favorable to the claimant than the Commissioner's own rules. In theory, however, the Appeals Council could vacate an ALJ's decision on the ground that the ALJ erroneously applied such appellate precedent. [End footnote] Thus, an ALJ has in fact some latitude to cite and apply Smolen. Notwithstanding the Commissioner's rejection of the vast body of appellate precedent as irrelevant, see 20 C.F.R. § 404.985 (2002), an individual ALJ still has the freedom to follow appellate precedent the Commissioner has not yet recognized as contrary to her interpretation of the Social Security Act or its regulations. Does case law matter to SSA ALJs? Yes, case law matters, and it matters in ways that the Commissioner does not admit.
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Eric Schnaufer, Attorney at Law, Eric Schnaufer's e-mail address |