Avery v. Astrue, Civil Action No. 07-30174-KPN.
| Decision Date | 13 March 2009 |
| Docket Number | Civil Action No. 07-30174-KPN. |
| Citation | 602 F.Supp.2d 266 |
| Parties | Daniel AVERY, Plaintiff v. Michael J. ASTRUE, Commissioner, Social Security Administration, Defendant. |
| Court | U.S. District Court — District of Massachusetts |
Karen L. Goodwin, United States Attorney's Office, Springfield, MA, for Defendant.
Stephen R. Kaplan, Northampton, MA, for Plaintiff.
MEMORANDUM AND ORDER WITH REGARD TO PLAINTIFF'S MOTION FOR JUDGMENT ON THE PLEADINGS and THE COMMISSIONER'S MOTION TO AFFIRM HIS FINAL DECISION (Document Nos. 9 and 11)
Pursuant to 42 U.S.C. § 405(g), Daniel Avery ("Plaintiff") seeks review of a final decision of the Commissioner of Social Security ("Commissioner") reducing the amount of his monthly Social Security disability ("SSDI") payments to account for his receipt of workers' compensation benefits. Plaintiff asserts that the Commissioner's calculations were in error and that his workers' compensation benefits ought to have been prorated over at least a 120 month period rather than the 25 months utilized by the Commissioner. In response, the Commissioner asserts that the shorter period was in accord with federal law and should be affirmed.
On February 25, 2009, the court heard oral argument on the parties' cross-motions for judgment, at which time they consented to its jurisdiction pursuant to 28 U.S.C. § 636(c) and Fed.R.Civ.P. 73. For the reasons that follow, the court will allow the Commissioner's motion and deny Plaintiff's motion.
Section 223 of the Social Security Act (the "Act"), codified at 42 U.S.C. § 423, provides for the payment of SSDI benefits to those individuals who have not attained retirement age but who have established a disability within the meaning of the Act. However, section 224(a) of the Act, 42 U.S.C. § 424a(a), provides for an offset of workers' compensation benefits against SSDI benefits, i.e., SSDI benefits are to be reduced for any month (prior to the month in which the individual attains the age of 65) in which the individual is entitled to both SSDI and periodic workers' compensation benefits so that the benefit total from the two sources does not exceed eighty percent of his pre-disability earnings.1 In turn, section 224(b), 42 U.S.C § 424a(b), provides that workers' compensation benefits payable on other than a monthly basis — e.g., a lump-sump payment that is intended as a commutation of, or a substitution for, periodic workers' compensation payments — are to be offset against SSDI benefits as well, at rates which "approximate as nearly as practicable" the reduction required by section 224(a).2 These offset provisions reflect Congressional concern that recovery of overlapping workers' compensation and SSDI benefits could decrease an injured worker's incentive to seek rehabilitation and further employment. See Richardson v. Belcher, 404 U.S. 78, 82, 92 S.Ct. 254, 30 L.Ed.2d 231 (1971); Davidson v. Sullivan, 942 F.2d 90, 92 (1 st Cir.1991).
The relevant facts of the case at bar are not in dispute. The parties agree that Plaintiff sustained a work-related injury as a janitor at the University of Massachusetts and received weekly workers' compensation benefits from March 1, 1998, through January 31, 2000. (Administrative Record ("A.R.") at 54, 88-90, 97.) In February of 2000, Plaintiff settled his workers' compensation claim for a lumpsum payment of $11,000; $2,365.50 of the award went towards attorney's fees and expenses and the balance, $8,634.50, was paid to Plaintiff. (A.R. at 95-99.) The lump-sum award did not make mention of a periodic payment rate. (See id.)
The parties also agree that Plaintiff applied for SSDI benefits on March 7, 2000. (See A.R. at 41.) In a decision dated July 23, 2001, amended on August 31, 2001, Plaintiff was found disabled within the meaning of the Act as of March 20, 1998. (A.R. at 30-36, 41.) The parties agree as well that retroactive benefits due Plaintiff could only be paid starting twelve months preceding the date of his application, i.e., from the beginning of March of 1999. See 42 U.S.C. § 423(b); 20 C.F.R. § 404.621(a)(1).
In an undated Notice of Award (A.R. at 46-51), but most likely dated on or about September 24, 2001 (see A.R. at 70), the Commissioner notified Plaintiff that his retroactive SSDI benefits would be reduced based on both his receipt of weekly workers' compensation benefits from March of 1999 through January of 2000, as well as the $11,000 lump-sum workers' compensation award he received in February of 2000. (A.R. at 46-51.) On reconsideration, however, the Commissioner reduced the lump-sum workers' compensation award which would be taken into account to $8,634.50 ($11,000 less $2,365.50 for attorney's fees and expenses) and prorated that balance toward the retroactive SSDI otherwise due Plaintiff at a weekly rate of $141.76. (A.R. at 53-56.) The weekly rate was such that the offset was applied to Plaintiffs retroactive SSDI benefits on a monthly basis from March of 1999 through March of 2001, a period of 25 months. Beginning in April of 2001, the Notice of Award explained, Plaintiffs SSDI benefits would be paid at the full monthly rate because his workers' compensation benefits would have been taken entirely into account. (A.R. at 47, 54.) Plaintiff soon challenged the offset calculation in a mandamus proceeding in this court, see Avery v. Barnhart, Civil Action No. 03-30232-MAP, but that case was dismissed on February 20, 2004, because of Plaintiffs failure to exhaust his administrative remedies.
Thereafter, on January 14, 2005, an administrative law judge ("ALJ") conducted a hearing on the offset issue. (A.R. at 121-29.) In a decision dated May 26, 2005, the ALJ determined that the net lumpsum award of $8,634.50 represented a payment in lieu of further weekly workers' compensation payments and had been properly used to offset Plaintiffs SSDI benefits. (A.R. at 23-25.) The ALJ found that, since the lump-sum settlement did not specify a periodic payment rate, Plaintiffs SSDI was correctly offset at the weekly workers' compensation rate previously received by him.3 The Appeals Council denied Plaintiffs request for review on July 20, 2008 (A.R. at 305), rendering the ALJ's decision final and subject to judicial review.
Judicial review in Social Security cases is typically limited to determining whether the findings of the Commissioner are supported by substantial evidence. 42 U.S.C. § 405(g). See also Richardson v. Perales, 402 U.S. 389, 390, 91 S.Ct. 1420, 28 L.Ed.2d 842 (1971); Barrientos v. Sec'y of Health & Human Servs., 820 F.2d 1, 2 (1st Cir.1987). The court "must uphold the [Commissioner's] findings ... if a reasonable mind, reviewing the evidence in the record as a whole, could accept it as adequate to support his conclusion." Rodriguez v. Sec'y of Health & Human Servs., 647 F.2d 218, 222 (1st Cir.1981). Accordingly, the court "must affirm the [Commissioner's] final decision, even if the record could justify a different conclusion, so long as it is supported by substantial evidence." Evangelista v. Sec'y of Health & Human Servs., 826 F.2d 136, 144 (1st Cir.1987). Where the question presented to the court is one of law, however, the Commissioner's determination is reviewable to determine whether his conclusions of law comport with controlling legal standards. See Slessinger v. Sec'y of Health & Human Servs., 835 F.2d 937, 939 (1st Cir.1987).
The Commissioner argues that the ALJ correctly determined the offset rate under federal law, while Plaintiff argues that the ALJ should have referred to state law and apply an offset prorated over 120 months. After first describing these arguments in greater detail, the court will analyze them and, in the end, conclude that Plaintiff has failed to establish that the ALJ's decision was not based upon substantial evidence or that the ALJ committed an error of law.
As indicated, the Commissioner maintains that the ALJ correctly determined the offset rate under controlling federal law, including section 224(b) and 20 C.F.R. § 404.408, which sets forth general rules regarding the amount of the monthly reduction in federal benefits. The Commissioner also asserts that the ALJ's decision complied with agency guidelines set out in the Program Operations Manual System ("POMS").4
The POMS, in applicable part, lists the following three methods to compute the rate of reduction for lump-sum workers' compensation awards:
a. The rate specified in the LS [lumpsum] award....
b. The latest periodic rate paid prior to the LS if no rate is specified in the LS award....
c. If WC [workers' compensation], the State's WC maximum in effect on the date of injury/illness. This figure can be used if no rate is specified in the award and there was no preceding periodic benefit.... The state maximum is the periodic rate that, in almost every case, would have been payable had periodic payments been made instead of a LS.
POMS, section DI 52001.555(C)(4), 2001 WL 1936336 (Prorating a Workers' Compensation Public Disability Benefit (WC/PDB) Lump Sum). The POMS lists these three methods in priority order but notes that all methods must be considered.5
Here, the Commissioner asserts that the ALJ correctly applied the second POMS method, i.e., the latest periodic rate paid, since the lump-sum award itself did not establish a rate. Accordingly, the Commissioner argues, the ALJ appropriately used the weekly rate of workers' compensation paid to Plaintiff prior to the lumpsum award. This approach, the Commissioner avers, approximated as nearly as practicable a reduction based on the receipt of monthly payments, as required by section 224(b).
For his part, Plaintiff acknowledges that the workers' compensation he received was intended to compensate him for the impairment to his earning capacity arising from his...
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