Felton v. Department of Social Services, Docket No. 91630

Decision Date18 September 1987
Docket NumberDocket No. 91630
Citation161 Mich.App. 690,411 N.W.2d 829
PartiesLois FELTON, by her husband, Charley Felton, as next friend, Petitioner-Appellant, v. DEPARTMENT OF SOCIAL SERVICES, Agnes Mansour, Director, Respondent-Appellee. 161 Mich.App. 690, 411 N.W.2d 829, 19 Soc.Sec.Rep.Ser. 311, Medicare&Medicaid Guide P 37,092
CourtCourt of Appeal of Michigan — District of US

[161 MICHAPP 692] Legal Services of Eastern Michigan by Kathryn Bakich and Edward J. Hoost, Flint, for petitioner-appellant.

Frank J. Kelley, Atty. Gen., Louis J. Caruso, Sol. Gen., and Michael J. Fraleigh, Asst. Atty. Gen., for respondent-appellee.

Before HOOD, P.J., and BEASLEY and TOWNSEND, * JJ.


This case involves a challenge to [161 MICHAPP 693] the denial of Medicaid disability benefits. Following an administrative hearing held on June 5, 1985, a hearing officer upheld the decision of the Michigan Department of Social Services to deny petitioner disability benefits. On appeal to Lapeer Circuit Court, the circuit judge upheld the decision of the hearing officer. Petitioner now appeals to this Court as of right. We reverse and order that DSS pay petitioner Medicaid benefits for hospital and medical expenses incurred by her from January, 1985, to March, 1985. 1

At the time of the administrative hearing petitioner was a 53-year old married woman with a high school education. Unemployed since 1981, her last job was as a grocery store clerk, which entailed operating the cash register, stocking groceries and cleaning shelves. She had also previously worked as a cook in a rest home.

Petitioner was hospitalized from March 4 to March 16, 1983, with chest pains linked to heart problems. At the time of discharge, she was diagnosed as suffering from an abnormally rapid heart rate coupled with anxiety, difficulty in breathing due to narrowing of her bronchial tubes, hyperactivity in her thyroid gland, and extreme potassium depletion in her blood. In January, 1985, petitioner underwent emergency surgery to remove a number of old and new blood clots present in both legs. She was also discovered to be a diabetic. She was discharged after seven days in the hospital, during which time she incurred expenses in excess of $18,000.

Petitioner was readmitted on February 4, 1985, complaining of chest pains. She was released four [161 MICHAPP 694] days later with the diagnosis of (1) recent myocardial infarction, (2) coronary insufficiency, (3) diabetes mellitus, and (4) peripheral vascular disease of the arteries and veins in the legs. An April 18, 1985, report from her regular family physician indicated that petitioner was suffering from coronary artery disease, diabetes, peripheral vascular occlusive disease, chronic pulmonary obstruction, and gangrene of two left toes.

On January 22, 1985, petitioner applied for Medicaid disability benefits. Her application was denied throughout the DSS administrative process because it was determined that she had not been disabled for a period of twelve months or more. In a decision issued on June 12, 1985, the hearing officer found petitioner not disabled and denied her application for Medicaid. About the same time petitioner suffered a stroke and again entered the hospital. On appeal to the circuit court, the hearing officer was affirmed because (1) the burden of proving her claim of disability was on the petitioner, (2) the hearing officer demonstrated no bias, (3) even though a hearing officer has a greater duty than a circuit judge to develop the record for an unrepresented claimant, the hearing officer in this hearing asked probing questions and gave petitioner a fair, full and complete hearing, and (4) the hearing officer correctly denied petitioner's application based on the medical records he had before him at the time of the hearing.

We review decisions of the hearing officer in the same manner as the circuit court does, under M.C.L. Sec. 24.306; M.S.A. Sec. 3.560(206). General Motors Corp v. Bureau of Safety & Regulation, 133 Mich.App. 284, 349 N.W.2d 157 (1984). Petitioner's argument essentially asserts that the decision of the hearing officer is not supported by "competent, material and substantial evidence on the whole record." [161 MICHAPP 695] M.C.L. Sec. 24.306(1)(d); M.S.A. Sec. 3.560(206)(1)(d). In Soto v. Director of the Michigan Dep't of Social Services, 73 Mich.App. 263, 271, 251 N.W.2d 292 (1977), this Court explained that

"['s]ubstantial evidence' means evidence which a reasoning mind would accept as sufficient to support a conclusion. 'It consists of more than a mere scintilla of evidence but may be somewhat less than a preponderance' of the evidence." (Citations omitted.)

Appellate courts in Michigan give considerable deference to the findings of administrative agencies, especially when it comes to fact-finding and weighing of the evidence. Smith v. Mayor of Ecorse, 81 Mich.App. 601, 604-605, 265 N.W.2d 766 (1978).

Medicaid disability benefits are administered by DSS in accordance with Subchapter XIX of the Social Security Act, 42 U.S.C. Sec. 1396 et seq.; see also M.C.L. Sec. 400.105 et seq.; M.S.A. Sec. 16.490(15) et seq., and the agency's program eligibility manual. The determination whether or not a person is disabled for purposes of medicaid eligibility is governed by 20 C.F.R. Sec. 404.1501 et seq. Under those regulations, disability is defined as "the inability to do any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months." 20 C.F.R. Sec. 404.1505(a); 20 CFR 416.905; 42 U.S.C. Sec. 1382. The Social Security regulations provide for a step-by-step review process for determining disability. 20 C.F.R. Sec. 404.1520. If at any step in the review it is determined that the petitioner is or is not disabled, review of the claim ceases. Mowery v. Heckler,[161 MICHAPP 696] 71 F.2d 966, 969 (C.A.6, 1985); 20 C.F.R. Sec. 404.1520(a).

The sequential consideration of a disability claim proceeds as follows:

(1) Is the claimant currently working, i.e., currently doing "substantial gainful activity"? 20 CFR 416.920(a).

(2) If not, does the claimant have a severe impairment, i.e., does the claimant have an impairment which "significantly limits [her] physical or mental ability to do basic work activities"? 20 CFR 416.920(c).

(3) If she does, does claimant have an impairment listed in Appendix 1 to Subpart P of 20 C.F.R., Part 404, i.e., a "listed impairment", so that the claimant can be found disabled based on the medical evidence alone?

(4) If not, does claimant's impairment prevent her from doing her past relevant work?

(5) If it does, does claimant's impairment prevent her from doing other work? 20 C.F.R. Sec. 404.1520.

See Mowery, supra, pp. 969-970; Kirk v. Secretary of Health & Human Services, 667 F.2d 524, 528 (C.A.6, 1981), cert. den. 461 U.S. 957, 103 S.Ct. 2428, 77 L.Ed.2d 1315 (1983).

Petitioner's chief complaint lies with the fifth step of the hearing officer's analysis. The fifth step of the review process requires the hearing officer to determine whether the claimant can perform other jobs which exist in significant numbers in the national economy. 20 CFR 416.1520, 416.1560 and 416.1561. This determination is based on the claimant's (1) "residual function capacity," defined simply as "what you can still do despite your limitations," 20 CFR 416.945, (2) age, education and work experience, and (3) the kinds of work [161 MICHAPP 697] which significant numbers in the national economy which the claimant could perform despite her impairments. 20 C.F.R. Sec. 404.1520(f) and 20 CFR 416.960.

Once the hearing officer determines the claimant's age, education, previous work experience and her "residual function capacity," these findings are plugged into one of three medical-vocational grids found at 20 C.F.R., Part 404, Subpart P, Appendix 2, which direct a conclusion of "disabled" or "not disabled." The United States Supreme Court has determined that these medical-vocational guidelines or grids may properly be used as a shortcut method of determining whether or not there are jobs in the national economy which a claimant can perform despite his or her limitations. Heckler v. Campbell, 461 U.S. 458, 103 S.Ct. 1952, 76 L.Ed.2d 66 (1983). However, federal courts have noted that "only when the findings of fact as to each of the relevant components of the grid 'coincide' with the grid's definitions, do the guidelines direct a conclusion as to disability." Kirk, supra, p. 528. "[I]f the characteristics of the claimant do not identically match the description in the grid, the grid is only used as a guide to the disability determination." Id.

In the instant case, the hearing officer made the following findings as to petitioner's age, education, previous work experience and residual function capacity:

(1) She was fifty-three years old and thus "a person approaching advanced age" as defined in 20 CFR 416.963;

(2) She had a 12th-grade education;

(3) Her previous work required the ability to perform "medium manual labor"; and

(4) She had the ability to meet the physical demands required to perform "light work".

[161 MICHAPP 698] As a result of his determination that petitioner could perform "light work," the hearing officer used Table 2 of Appendix 2, 20 C.F.R., Part 404, Subpart P, to conclude that petitioner was not disabled. The hearing officer said he relied on Rule 202.1 of Table 2 to make his determination, but there is no such rule in that table. There is a Rule 202.10, but that line on the table coincides with someone who has less education than a high school graduate, and thus would not seem to fit petitioner, whom the hearing officer found to have a 12th-grade education. Respondent suggests that the petitioner's characteristics are found...

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