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finding the Medicaid approval was relevant in time because it overlapped the period of time at issue before the ALJ
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No. 2:16-CV-00058-D
06-28-2017
Tyrone T. Perry, Plaintiff, v. Nancy A. Berryhill, Acting Commissioner of Social Security, Defendant.
Memorandum & Recommendation
Plaintiff Tyrone T. Perry instituted this action on September 23, 2016, to challenge the denial of his application for social security income. Perry claims that the Administrative Law Judge ("ALJ") Catherine Harper erred in finding that he did not have a severe impairment and that new evidence he submitted warrants remand. Both Perry and Defendant Nancy A. Berryhill, the Acting Commissioner of Social Security, have filed motions seeking a judgment on the pleadings in their favor. D.E. 18, 21.
After reviewing the parties' arguments, the court has determined that ALJ Harper erred in her determination. ALJ Harper failed to consider and explain what effect Perry's Medicaid approval had on the disability decision. Additionally, this new evidence may impact a finding of whether Perry established a medically-determinable impairment at step two on the analysis. Therefore, the undersigned magistrate judge recommends that the court grant Perry's motion, deny Berryhill's motion, and remand this matter to the Commissioner for further consideration.
The court has referred this matter to the undersigned for entry of a Memorandum and Recommendation. 28 U.S.C. § 636(b). --------
I. Background
On September 21, 2011, Perry filed applications for disability insurance benefits and supplemental security income. In both applications, he alleged a disability that began on May 1, 2008. After his claims were denied at the initial level and upon reconsideration, Perry appeared before an ALJ for a hearing to determine his entitlement to benefits. The ALJ concluded he was not entitled to benefits because he was not disabled. After Perry appealed the decision, the Appeals Council remanded the action because the record failed to establish that Perry had been advised of his right to representation or that he had made an informed decision to proceed without representation.
After Perry secured representation, he appeared for a hearing before ALJ Harper on November 13, 2014, to determine whether he was entitled to benefits. ALJ Harper determined determined Perry was not entitled to benefits because he was not disabled. Tr. at 11-17.
ALJ Harper found that Perry had the following medical conditions: hypertension, acute right knee strain, chest pain, lower back pain, shortness of breath, and osteoarthritis. Id. at 14. However, she determined that the hypertension was medically managed and that the knee condition resolved within 12 months. Id. Accordingly, these were not severe impairments because they presented no more than a minimal impact on Perry's ability to engage in basic work activities. Id . ALJ Harper also found that Perry's other conditions were symptoms, not medically-determinable impairments established by medical evidence consisting of signs, symptoms, and laboratory findings, as diagnosed by an acceptable medical source. Id. Thus, ALJ Harper found that Perry was not disabled. Id . at 17.
After unsuccessfully seeking review by the Appeals Council, Perry commenced this action on September 23, 2016. D.E. 7.
II. Analysis
A. Standard for Review of the Acting Commissioner's Final Decision
When a social security claimant appeals a final decision of the Commissioner, the district court's review is limited to the determination of whether, based on the entire administrative record, there is substantial evidence to support the Commissioner's findings. 42 U.S.C. § 405(g); Richardson v. Perales, 402 U.S. 389, 401 (1971). Substantial evidence is defined as "evidence which a reasoning mind would accept as sufficient to support a particular conclusion." Shively v. Heckler, 739 F.2d 987, 989 (4th Cir. 1984) (quoting Laws v. Celebrezze, 368 F.2d 640, 642 (4th Cir. 1966)). If the Commissioner's decision is supported by such evidence, it must be affirmed. Smith v. Chater, 99 F.3d 635, 638 (4th Cir. 1996).
B. Standard for Evaluating Disability
In making a disability determination, the ALJ engages in a five-step evaluation process. 20 C.F.R. § 404.1520; see Johnson v. Barnhart, 434 F.3d 650 (4th Cir. 2005). The analysis requires the ALJ to consider the following enumerated factors sequentially. At step one, if the claimant is currently engaged in substantial gainful activity, the claim is denied. At step two, the claim is denied if the claimant does not have a severe impairment or combination of impairments significantly limiting him or her from performing basic work activities. At step three, the claimant's impairment is compared to those in the Listing of Impairments. See 20 C.F.R. Part 404, Subpart P, App. 1. If the impairment is listed in the Listing of Impairments or if it is equivalent to a listed impairment, disability is conclusively presumed. However, if the claimant's impairment does not meet or equal a listed impairment, the ALJ assesses the claimant's RFC to determine, at step four, whether he can perform his past work despite his impairments. If the claimant cannot perform past relevant work, the analysis moves on to step five: establishing whether the claimant, based on his age, work experience, and RFC can perform other substantial gainful work. The burden of proof is on the claimant for the first four steps of this inquiry, but shifts to the Commissioner at the fifth step. Pass v. Chater, 65 F.3d 1200, 1203 (4th Cir. 1995).
C. Medical Background
Dr. Steven Ferguson performed a consultative examination in October 2011. Tr. at 341-44. Perry reported back pain and Dr. Ferguson noted that Perry exhibited mild tenderness. Id . Examination revealed clear lungs, regular heart rate and rhythm, normal range of motion, and normal muscle strength. Id . Although there was a small cyst near his right wrist, Perry's bilateral hand grip was good. Id. Dr. Ferguson remarked that Perry had some difficulty with heel and toe standing, but that he ambulated without assistance. Id. Dr. Ferguson concluded that the exam findings were "largely unremarkable." Id . at 344.
In 2013, Perry received treatment from Rowan Chowan Community Health Center. Id. at 387-407. Perry received a muscle relaxant and medication for hypertension in January 2013. Id. He denied chest pain, shortness of breath on exertion, or palpitations on a follow-up visit. Id. In April 2013, Perry reported back pain and arm weakness but acknowledged these problems did not impact his daily activities. Id. Chrystie Stowe, a nurse practitioner, did not note any findings upon examination or obtain diagnostic imaging studies, but she assessed him with osteoarthritis of the right knee and hip. Id.
Perry saw Alan Goddard, a physician assistant, in May 2014. Goddard assessed hypertension. Id . Perry returned to Goddard in July for an evaluation for asbestosis, but a chest x-ray showed no evidence of that condition. Id . While Perry reported he was easily fatigued, examination showed he had no shortness or breath or wheezing, despite being a smoker. Id . He had tenderness in his spine but negative straight leg raises. Id. Goddard referred Perry to physical therapy. Id.
In July 2014, Perry presented to the Emergency Department of Rowan-Chowan Hospital complaining of chest pain and other discomfort. Id. at 382. Providers diagnosed chest pain and right knee strain. Id.
Perry reported that he managed his hypertension with medication. Id. at 14. His past history of a knee strain resolved within 12 months. Id. He has also complained of chest pain and back pain. Id.
Perry alleges that he has difficulty standing. Id. at 32. He tries not to lift anything because he has a condition, possibly a cyst, on his non-dominant, right arm. Id. at 34. He stated he is unable to work because of pain. Id . at 30-31. He noted back pain, but stated he does not take medication for it. Id. At times when he did take medication, he did not experience drowsiness but noted the medicine did not help his pain symptoms very much. Id. at 28-29.
D. New Evidence
Perry contends that his approval for Medicaid constitutes new evidence which warrants further consideration of his claim. The Commissioner asserts that this evidence was previously considered by the Appeals Council, which concluded it did not provide a basis to reverse ALJ Harper's decision. The court finds that the Medicaid approval requires further consideration.
The Appeals Council must consider evidence submitted by a claimant with the request for review "if the additional evidence is (a) new, (b) material, and (c) relates to the period on or before the date of the ALJ's decision. Wilkins v. Sec'y, Dep't of Health & Human Servs., 953 F.2d 93, 95-96 (4th Cir. 1991); 20 C.F.R. §§ 404.976(b)(1), 416.1476(b)(1) ("The Appeals Council will consider all the evidence in the administrative law judge hearing record as well as any new and material evidence submitted to it which relates to the period on or before the date of the administrative law judge hearing decision."). Evidence is new if it is not duplicative or cumulative, and material if there is a "reasonable possibility that the new evidence would have changed the outcome of the case." Wilkins, 953 F.2d at 96. "[T]he Appeals Council must consider new and material evidence relating to that period prior to the ALJ decision in determining whether to grant review, even though it may ultimately decline review." Id. at 95. However, the Appeals Council does not need to explain its reason for denying review of an ALJ's decision. Meyer v. Astrue, 662 F.3d 700, 702 (4th Cir. 2011). Remand is required if the court concludes that the Commissioner's decision is not supported by substantial evidence based on the record as supplemented by the evidence submitted at the Appeals Council level. Felts v. Astrue, No. 1:11-cv-0054, 2012 WL 1836280, at *1-2 (W.D. Va. May 19, 2012).
The Medicaid approval is effective from May 1, 2014, through September 30, 2015, and thus overlaps the relevant period at issue before ALJ Harper. Tr. at 408. It notes that Perry meets all the eligibility requirements. Id. The Appeals Council considered the Medicaid decision and it incorporated that evidence into the administrative record. Id. at 2, 408. It concluded, however, that this evidence did not provide a basis for changing ALJ Harper's decision. Id. at 2.
This evidence qualifies as "new" because it is not duplicative or cumulative of other evidence already in the record. Additionally, the Medicaid approval is relevant because it overlaps the period of time at issue before ALJ Harper.
The Medicaid finding also qualifies as material. The Social Security Regulations provide that a disability decision by another governmental agency must be considered, although such decisions are not binding on the Commissioner. SSR 06-03p, 2006 WL 2329939, at *6 (Aug. 9, 2006). As explained below, the Medicaid approval constitutes a disability decision which an ALJ must consider. Moreover, as the Fourth Circuit has noted that SSA's DIB and SSI programs and the Medicaid program share similar standards and requirements, it is not unreasonable to conclude that the Medicaid approval may change the outcome of this case given the programs' parallel inquiries into disability. This renders the Medicaid approval material to Perry's claim.
Perry argues that Bird v. Commissioner of Social Security Administration supports remand because ALJ Harper did not address the Medicaid approval in making her disability determination. 699 F.3d 337 (4th Cir. 2012). The Commissioner maintains that the Medicaid approval is not a "decision" of another agency which requires consideration because there is no record of any evidence considered by the agency or its reasoning behind a decision to grant Plaintiff Medicaid.
In Bird, the Fourth Circuit addressed the value of disability findings by other agencies. Id. While another agency's disability determination is not binding on the SSA, it noted that "another agency's disability determination 'cannot be ignored and must be considered.'" Bird, 699 F.3d at 343. The Fourth Circuit noted that often times the disability assessments serve the same governmental purpose of providing benefits to persons unable to work, evaluate a claimant's ability to perform full-time work, analyze a claimant's functional limitations, and require extensive medical documentation to support the claims. Id. Assigning less weight to another governmental agency's disability determination may be warranted "when the record before the ALJ clearly demonstrates that such a deviation is appropriate." Id.
Subsequent case law within the Fourth Circuit has explicitly extended the holding in Bird to Medicaid decisions, noting that both the Medicaid and VA disability programs share markedly similar standards and requirements with the DIB and SSI programs at issue here. See, e.g., Harvey v. Colvin, No. 5:13-cv-00074, 2014 WL 4093483, at *5 (W.D. Va. Aug. 18, 2014) ("[T]he state agency's determination that [claimant] is disabled for purposes of Medicaid may provide relevant evidence that the Commissioner should consider."); Baughman v. Colvin, No. 5:13-cv-143-FL, 2014 WL 3345030, at *7-8 (E.D.N.C. July 8, 2014) (remanding case for failure to explain consideration given to Medicaid decision, where "[a]pplying the same regulations governing SSA determinations, the NCDHHS determined that Claimant was limited to performing sedentary work, which resulted in a directed finding of disabled"); Allen v. Colvin, No. 2:12-cv-29-FL, 2013 WL 3983984, at *2 (E.D.N.C. Aug. 1, 2013) (remanding to allow SSA to "give appropriate consideration to the NCDHHS Medicaid Determination"); Caraballo v. Colvin, No. 4:12-cv-125-D, 2013 WL 3197070, at *3-4 (E.D.N.C. June 21, 2013) ("Failure to discuss a Medicaid decision requires remand."); Gaskins v. Colvin, No. 3:12-cv-81, 2013 WL 3148717, at *3-4 (N.D. W. Va. June 19, 2013) (holding that even if the evidence of the Medicaid decision is conclusory, "the Social Security Administration's own internal policy interpretation rulings affirmatively require[ ] the ALJ to consider evidence of a disability decision by another governmental agency," and these regulations "do not limit the required review of other agency's disability determinations to cases where the decision is substantive" because "to the extent that Medicaid decisions employ the same standards as the Social Security Administration uses in disability determinations, such decisions are probative in situations such as the instant one where an agency has applied the same rules yet reached the opposite result from the Social Security Administration" (internal quotations and brackets omitted)). Additionally, our sister court has stated that "the [Medicaid approval] . . . is plainly a disability decision by another agency, and, as such, it must be considered by the ALJ." Ball v. Colvin, No. 1:14-cv-266, 2015 WL 5714525, at *3 (W.D.N.C. Sept. 1, 2015), report and recommendation adopted, No. 1:14-cv-00266-MOC, 2015 WL 5725254 (W.D.N.C. Sept. 29, 2015)
Perry referenced his Medicaid approval at the hearing and ALJ Harper stated she would hold the record open for two weeks after the hearing for submission of the Medicaid decision documents. Tr. at 11. Her determination remarked that, despite waiting for four months, Perry had not submitted these documents. Id. However, Perry contends that this exhibit was submitted to the SSA on the date of his hearing. Id . at 339. The exhibit includes a copy of his Approval Notice from the Bertie County Department of Social Services as well as a copy of his Medicaid Identification Card. Id . at 408-10.
As the evidence appears to show it was part of the record before her, ALJ Harper had a clear obligation to discuss Perry's Medicaid approval. The fact that the Medicaid approval was not specifically considered or its impact on disability analysis explained precludes meaningful review of the disability determination at this juncture. The Appeals Council's finding that the this evidence did not provide a basis to reverse ALJ Harper's decision does not remedy her oversight because this court cannot assess the how the Commissioner evaluated the Medicaid approval or what effect, if any, it may have on the disability determination. ALJ Harper implicitly acknowledged the relevance of the Medicaid approval given the fact that she held the record open for its receipt before issuing her determination. Her decision even commented on Perry's apparent, but not actual, failure to submit it. Id. at 11. At some point, the Commissioner must explain the import of this evidence on its disability determination.
Unable to discern what probative value Perry's Medicaid approval bore on the examination of his disability claim as required under both Bird and the Regulations, the court finds that remand is warranted.
E. Step Two
Perry also argues that ALJ Harper erred in finding that his impairments, either alone or in combination, were not severe. The Commissioner contends that substantial evidence supports ALJ Harper's characterizations of Perry's conditions as non-severe. Because the Medicaid approval was not considered but may influence the disability analysis, including whether Perry had a medically determinable impairment, the court cannot conclude that substantial evidence support the step two finding.
At step two of the sequential evaluation process, the ALJ must consider the severity of the claimant's impairments. 20 C.F.R. § 404.1520(a)(4)(ii). "To be found disabled, an individual must have a medically determinable 'severe' physical or mental impairment or combination of impairments that meets the duration requirement." SSR 96-3p, 1996 WL 374181, at *1 (July 2, 1996). The duration requirement provides that unless a claimant's "impairment is expected to result in death, it must have lasted or must be expected to last for a continuous period of at least 12 months." 20 C.F.R. § 404.1509. An impairment is considered to be severe "if it significantly limits an individual's physical or mental abilities to do basic work activities; an impairment(s) that is 'not severe' must be a slight abnormality (or a combination of slight abnormalities) that has no more than a minimal effect on the ability to do basic work activities." SSR 96-3p, 1996 WL 374181, at *1; see also 20 C.F.R. § 404.1521 (defining non-severe impairments and providing examples of basic work activities). The burden of proof and production during the second step rests on the claimant. Pass, 65 F.3d at 1203. An ALJ may deny a disability claim at step two if he finds there is no severe impairment or combination of impairments that significantly limits the claimant from performing basic work activities.
The issue before the court is whether ALJ Harper erred in determining that Perry did not have a medically determinable physical or mental impairment that was severe during the relevant time period. However, the court need not resolve the issue of whether Perry had a medically determinable impairment. Recognizing the potential influence the other disability determination may have on the present matter, especially given the similar standards and requirements between the disability programs of the SSA and Medicaid, on remand the ALJ may determine that Perry's Medicaid approval provides additional evidence for, or otherwise informs, the step two finding.
Because remand for examination of the Medicaid approval is warranted, and that consideration may effect the sequential evaluation process generally and the step two finding specifically, further review of whether Perry has a medically determinable impairment is also appropriate.
III. Conclusion
For the forgoing reasons, the court recommends that the court grant Perry's Motion for Judgment on the Pleadings (D.E. 18), deny Berryhill's Motion for Judgment on the Pleadings (D.E. 21), and remand the Commissioner's decision for further consideration.
Furthermore, the court directs that the Clerk of Court serve a copy of this Memorandum and Recommendation on each of the parties or, if represented, their counsel. Each party shall have until 14 days after service of the Memorandum and Recommendation on the party 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)(1); 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.
If a party does not file written objections to the Memorandum and Recommendation by the foregoing deadline, the party 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, the party's failure to file written objections by the foregoing deadline will 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 Owen v. Collins , 766 F.2d 841, 846-47 (4th Cir. 1985). Dated: June 28, 2017
/s/_________
ROBERT T. NUMBERS, II
UNITED STATES MAGISTRATE JUDGE