Finkelstein v. Sullivan

• Decision Date: 23 January 1991
• Docket Number: No. 88-5318,88-5318
• Citation: 924 F.2d 483
• Parties: , Unempl.Ins.Rep. CCH 15889A Marilyn FINKELSTEIN, Appellee, v. Louis W. SULLIVAN, M.D., Secretary of Health and Human Services, Appellant.
• Court: U.S. Court of Appeals — Third Circuit

Page 483

924 F.2d 483

32 Soc.Sec.Rep.Ser. 276, Unempl.Ins.Rep. CCH 15889A

Marilyn FINKELSTEIN, Appellee, v. Louis W. SULLIVAN, M.D., Secretary of Health and Human Services, Appellant.

No. 88-5318.

United States Court of Appeals Third Circuit.

Argued Sept. 8, 1988.

Decided March 3, 1989.

Certiorari Granted Jan. 22, 1990.

On Remand from the Supreme Court of the United States

June 18, 1990.

Argued on Remand from the Supreme Court Nov. 15, 1990.

Decided Jan. 23, 1991.

Robert M. Loeb (argued), Atty., Appellate Staff, Civil Div., U.S. Dept. of Justice, Washington, D.C., for appellant.

Linda C. Goldstein (argued), Howard, Darby & Levin, New York City, for appellee.

Catherine C. Carr, Steven Masters, and James M. Lafferty, Meris L. Bergquist, Community Legal Services, Inc., Philadelphia, Pa., for amici curiae Class Members in Bozzi v. Sullivan, No. 90-2580 (E.D.Pa.) in support of appellee.

Before BECKER, HUTCHINSON and SCIRICA, Circuit Judges.

OPINION OF THE COURT

HUTCHINSON, Circuit Judge.

This case comes before us on remand from the Supreme Court, after it reversed our earlier judgment holding that we lacked appellate jurisdiction over the Secretary of Health and Human Services' (Secretary's) appeal from a district court order remanding Marilyn Finkelstein's (Finkelstein's) claim to the Secretary for reconsideration of his refusal to grant her widows' benefits under the Social Security Act. See Sullivan v. Finkelstein, --- U.S. ----, 110 S.Ct. 2658, 110 L.Ed.2d 563 (1990), rev'g Finkelstein v. Bowen, 869 F.2d 215 (3d Cir.1989). Accordingly, we must now decide the merits of the Secretary's appeal.

I.

The Social Security Act, 42 U.S.C.A. Secs. 301-1397e (West 1983 & Supp.1990), provides that widows ¹ shall not be determined to be under a disability unless they are unable to perform "any gainful activity," 42 U.S.C.A. Sec. 423(d)(2)(B). ² Here, we must decide whether the Secretary may determine that widows do not qualify for widows' benefits under the Act without ever considering their residual functional capacity (RFC) to perform any gainful activity.

In the order up for review, the district court held that the Secretary could not deny Finkelstein's application for widows' benefits without making "findings regarding the functional impact of [her] ailment." See Appellant's Appendix (App.) at 30. For the reasons discussed below, we hold that the Secretary exceeded his statutory authority under 42 U.S.C.A. Sec. 423(d)(2)(B) when he adopted a regulatory scheme that denies widows' benefits to widows who so lack residual functional capacity that they are unable to perform "any gainful activity." We will therefore affirm the district court's order remanding Finkelstein's application for widows' benefits to the Secretary with directions that he evaluate the functional impact of her disabilities.

II.

Finkelstein is the widow of a wage earner who died while fully insured under the Social Security Disability Insurance program, found at Title II of the Social Security Act. She first applied for widows' benefits at the age of fifty in January of 1981, shortly after the death of her husband on November 27, 1980. The Secretary found that she could not perform any gainful activity and awarded her widows' benefits. However, Finkelstein lost her entitlement to widows' benefits in December of 1982 when she remarried. Under the law as it stood at that time, widows who remarried before age sixty no longer qualified for widows' benefits.

In March of 1983, Congress enacted a law that restored benefits to remarried widows. Finkelstein reapplied for widows' benefits in November of 1983 in order to receive them once the new law took effect. In reviewing Finkelstein's second application, the Secretary subjected her to a de novo disability determination.

On September 12, 1984, Finkelstein's application for widows' benefits was the subject of a hearing before an Administrative Law Judge (ALJ). See Administrative Record (A.R.) at 16. At the hearing, Finkelstein testified that she suffers severe chest pain three to four times per week. See id. at 29. She stated that she can only walk half a block before experiencing pain that she described as a tightness in her chest. See id. at 30, 41. She further testified that she is confined to the first floor of her apartment, see id. at 34, and that she relies upon her husband and her daughter to do virtually all of the work at home, see id. at 40. Finkelstein also introduced medical evidence at the hearing. See id. at 19. The medical evidence included doctors' opinions that she suffers from two heart ailments: myocardial ischemia and mitral valve prolapse.

The ALJ denied Finkelstein's reapplication for widows' benefits in a written decision dated September 28, 1984. See id. at 10-13. In accord with the regulatory practice the Secretary has prescribed for evaluating a widow's application for benefits, the ALJ compared Finkelstein's medical condition to a list of 125 listed physical and mental illnesses and abnormalities that the regulations presume prevent a person from engaging in any gainful activity. In Finkelstein's case, the ALJ focussed his comparison upon listing 4.04, entitled "Ischemic Heart Disease." See 20 C.F.R. Part 404, Subpart P, Appendix 1 (Part A), Sec. 4.04.

The ALJ held that Finkelstein's impairments did not match the requirements contained in the listing for Ischemic Heart Disease. Further, the ALJ held that her impairments did not equal listing 4.04 because her condition did not present medical findings equal in severity to all the criteria contained in listing 4.04. The ALJ then noted that Finkelstein failed to match or equal any of the remaining 124 listings. See A.R. at 12. As a result, the ALJ denied Finkelstein's application for widows' benefits without considering whether her residual functional capacity nevertheless rendered her unable to perform any gainful activity. Finkelstein then requested review of the ALJ's decision from the Social Security Administration's Appeals Council. The Appeals Council denied the request for review, leaving the ALJ's decision as the Secretary's final decision upon her claim. See id. at 3.

On January 22, 1985, Finkelstein filed suit in the United States District Court for the District of New Jersey. In her complaint, she asked the district court either to "award appropriate benefits" or "to remand this matter to the Secretary for additional hearing." App. at 4. On February 16, 1988, the district court issued its order and a memorandum opinion. The district court affirmed the Secretary's determination that Finkelstein's condition did not match or equal the listing for Ischemic Heart Disease. ³ However, the district court ordered Finkelstein's case remanded to the Secretary for a determination of "the functional impact of [her] ailment." Id. at 30.

The Secretary filed a timely notice of appeal. Relying on a number of our Court's prior decisions, we held that the district court's remand order was "not final for purposes of appellate review." See Finkelstein v. Bowen, 869 F.2d 215, 216 (3d Cir.1989), rev'd sub nom. Sullivan v. Finkelstein, --- U.S. ----, 110 S.Ct. 2658, 110 L.Ed.2d 563 (1990). We thus ordered that the Secretary's appeal be dismissed for lack of appellate jurisdiction. See id. at 220. The Secretary filed a petition for a writ of certiorari with the Supreme Court. The Supreme Court granted the writ and reversed our earlier decision. The Supreme Court held that the district court's order remanding Finkelstein's case to the Secretary was a final decision under 28 U.S.C.A. Sec. 1291 (West Supp.1990). See Finkelstein, 110 S.Ct. at 2661. This appeal is now before us on remand from the Supreme Court so that we may address the merits of the Secretary's appeal.

III.

The district court had jurisdiction over Finkelstein's complaint pursuant to 42 U.S.C.A. Sec. 405(g) (West 1983). We have appellate jurisdiction over the Secretary's appeal pursuant to 28 U.S.C.A. Sec. 1291.

On this remand, we must determine whether the district court erred as a matter of law when it "essentially invalidated, as inconsistent with the Social Security Act, the Secretary's regulations restricting spouses' disability insurance benefits to those claimants who can show that they have impairments" that match or equal one of the Secretary's 125 listed impairments. Finkelstein, 110 S.Ct. at 2663. As a result, our scope of review is plenary. See International Union, UMWA v. Racho Trucking Co., 897 F.2d 1248, 1252 (3d Cir.1990) (question of law is subject to plenary review).

This appeal focuses upon the regulatory scheme the Secretary follows in determining whether to award widows' benefits. As the Supreme Court stated in Sullivan v. Zebley, --- U.S. ----, 110 S.Ct. 885, 890, 107 L.Ed.2d 967 (1990) (citation and internal quotations omitted), "[s]ince the Social Security Act expressly grants the Secretary rulemaking power, our review is limited to determining whether the regulations promulgated exceed the Secretary's statutory authority and whether they are arbitrary and capricious."

IV.

A.

In 1968, Congress added to the Social Security Act a provision granting benefits to widows on account of their deceased spouses' payments into the social security fund. See 42 U.S.C.A. Sec. 423(d)(2)(B). However, Congress set a more stringent standard for widows than for wage earners who sought disability benefits.

For wage earners, the statute provides:

An individual (except a widow, surviving divorced wife, widower, or surviving divorced husband ...) shall be determined to be under a disability only if his physical or mental impairment or impairments are of such severity that he is not only unable to do his previous work but cannot, considering his age, education, and work experience, engage in any other kind of substantial gainful work which exists in the national economy....

Id. Sec. 423(d)(2)(A).

For widows, the statute provides:

A widow, surviving...