Mental Health Ass'n of Minnesota v. Heckler
| Decision Date | 04 November 1983 |
| Docket Number | No. 83-1263,83-1263 |
| Parties | , Unempl.Ins.Rep. CCH 15,036 MENTAL HEALTH ASSOCIATION OF MINNESOTA, and H.C., K.F., J.M., and C.A., on behalf of themselves and others similarly situated, Appellees, v. Margaret M. HECKLER, Secretary of the United States Department of Health and Human Services, Appellant. |
| Court | U.S. Court of Appeals — Eighth Circuit |
James M. Rosenbaum, U.S. Atty., Mary L. Egan, Asst. U.S. Atty., Minneapolis, Minn., Donald A. Gonya, Asst. Gen. Counsel, Dept. of Health and Human Services, Randolph W. Gaines, Deputy Asst. Gen. Counsel for Litigation, A. George Lowe, Chief, Disability Litigation Branch, Gabriel L. Imperato, Social Security Division Dept. of Health and Human Services, Baltimore, Md., for appellant.
Mark A. Bohnhorst, Litigation Coordinator, Martha A. Eaves, Southern Minnesota Regional Legal Services, Inc., St. Paul, Minn., William Messinger, Messinger, Cooper & Norton, Minneapolis, Minn., for Mental Health Association of Minnesota, Leonard S. Rubenstein, Jane Bloom Yohalem, Mental Health Law Project, Washington, D.C., Co-Counsel, for appellees.
Anthony Celebrezze, Jr., Atty. Gen., State of Ohio, Columbus, Ohio, Frank J. Kelley, Atty. Gen., State of Mich., Lansing, Mich., Hubert H. Humphrey III, Atty. Gen., State of Minn., P. Kenneth Kohnstamm, Sp. Asst. Atty. Gen., St. Paul, Minn., amici curiae for appellees.
Before LAY, Chief Judge, SWYGERT, * Senior Circuit Judge, and ARNOLD, Circuit Judge.
The Secretary of Health and Human Services appeals from the district court order 1 granting the plaintiffs' motion for a preliminary injunction. The underlying dispute before the district court is a class action challenging the procedure used by the Secretary in disability determinations of the severely mentally ill in Region V. 2 See 42 U.S.C. Secs. 401-431 (1976 & Supp. V 1981) (Social Security Disability Insurance (SSDI) benefits for disabled workers; 42 U.S.C. Secs. 1381-1383 (1976 & Supp. V 1981) (Supplemental Security Income (SSI) for the Aged, Blind, and Disabled). 3 The plaintiffs contend that the substantive standards employed by the Secretary in disability determinations did not comply with the relevant statutory and regulatory procedures.
In issuing the preliminary injunction, the district court enjoined the Secretary from employing a presumption that an individual whose mental impairment is not as severe as those contained in the Listing of Impairments 4 is capable of performing at least unskilled work. Additionally, the Order required the Secretary inter alia to review the claims of all class members whose claims were denied or whose benefits were terminated on or after March 1, 1981. Moreover, in making disability determinations, the Secretary is required to accord "substantial consideration" to information from treating sources. Additionally, the court ordered reinstatement of benefits pending review for those claimants whose benefits were so terminated. 554 F.Supp. at 168-69; see also Mental Health Ass'n of Minn. v. Heckler, Supplemental Orders Feb. 11, 1983 and Mar. 31, 1983 (D.Minn). On appeal, 5 the Secretary challenges the district court's jurisdiction as well as the propriety and scope of the relief awarded. We affirm the preliminary injunction issued by the district court with the modifications specified below.
The relevant statute establishes guidelines for disability determinations and delegates to the Secretary the duty to promulgate implementing regulations. 6 Accordingly, the regulations provide a five-step sequential evaluation process, through which benefit claims are funneled. First, the Secretary determines whether an individual is engaged in "substantial gainful activity"; if so, benefits are denied. 20 C.F.R. Secs. 404.1520(b), 416.920(b) (1981). If not, the Secretary determines whether the claimant's medical condition or impairment is "severe"; if found "not severe," benefits are denied. Id. Secs. 404.1520(c), 404.1521, 416.920(c). Third, the Secretary determines whether the claimant suffers from an impairment acknowledged to be so severe that the claimant is presumed to be incapable of pursuing any gainful activity. If so, then the claimant meets or equals the Listing of Impairments and benefits are awarded. Id. Secs. 404.1520(d), 416.920(d); see "Listing of Impairments," supra. However, if the claimant's impairment does not satisfy the Listing of Impairments, the fourth step requires the Secretary to determine whether the individual has a sufficient "residual functional capacity" (RFC) to perform his former work. If so, benefits are denied. Id. Sec. 404.1520(e); see id. Sec. 404.1545(c). If an individual still has not been ruled ineligible for benefits, the fifth step requires the Secretary to take into account the additional considerations of age, education, and past work experience to determine whether the individual is capable of performing any other work available in the economy. Id. Sec. 404.1520(f)(1).
The primary issue before the district court concerned the RFC determination made in the fourth step. An individual's RFC is derived from a comprehensive, individualized assessment of the claimant's limitations--physical and mental. See id. Sec. 404.1545-.1569. On the basis of the RFC, the Secretary determines whether the individual retains the ability to perform his or her past work. The district court, however, found that in early 1980, the state DDS (Disability Determination Service) agents in Region V applied a different standard. 7 The court found that the policy prevalent in Region V was for state DDS agents to apply a presumption that those claimants whose mental impairments were not as severe as those in the Listing of Impairments retained a sufficient RFC to do at least unskilled work. The effect of this presumption was that mentally impaired claimants ruled ineligible for benefits under the third step were presumed ineligible under the subsequent steps, thereby bypassing the individual assessment required in the fourth level. On the basis of this finding, the district court issued its preliminary injunction.
A threshold question is raised concerning the district court's jurisdiction. The complaint alleges jurisdiction under section 205(g) of the Social Security Act, 42 U.S.C. Sec. 405(g) (1976 & Supp. V 1981), 8 the mandamus statute, 28 U.S.C. Sec. 1361 (1976), 9 and the general federal question statute, 28 U.S.C. Sec. 1331 (1976 & Supp. V 1981).
The district court did not state its jurisdictional basis; however, the court apparently relied on Aldrich v. Schweiker, 555 F.Supp. 1080 (D.Vt.1982). In Aldrich, plaintiffs brought a class action alleging that the defendant's regulations, policies, and practices used in disability determinations did not comport with the Social Security Act. The court asserted section 205(g) jurisdiction over the plaintiffs who had filed claims with the Secretary and mandamus jurisdiction over those claimants who had pursued their administrative remedies and currently were receiving benefits. See also Schisler v. Schweiker, Civ. 80-572E (W.D.N.Y. Aug. 11, 1981) (mandamus jurisdiction). We conclude jurisdiction exists under either section 205(g) or the mandamus statute. 10
It is now well established that section 205(g) imposes two jurisdictional prerequisites to review of a claim arising under the Social Security Act. The first is non-waivable and requires that the individual have presented a claim to the Secretary. As the plaintiffs assert, this requires an application for benefits; or, in the case of someone who had been receiving benefits and was terminated, it requires notification to the agency that the claimant still asserts disability. Mathews v. Eldridge, 424 U.S. 319, 329, 96 S.Ct. 893, 900, 47 L.Ed.2d 18 (1976); cf. Weinberger v. Salfi, 422 U.S. 749, 763, 95 S.Ct. 2457, 2465-66, 45 L.Ed.2d 522 (1975) (); Mathews v. Diaz, 426 U.S. 67, 72, 76, 96 S.Ct. 1883, 1887-88, 1889-90, 48 L.Ed.2d 478 (1976) (). See also Kuehner v. Schweiker, 717 F.2d 813 (3d Cir.1983); Jones v. Califano, 576 F.2d 12, 18 (2d Cir.1978) (). Here the Secretary apparently concedes that the named plaintiffs have met this threshold requirement. The Secretary, however, urges that plaintiffs have failed to establish the second jurisdictional requirement of section 205(g).
Section 205(g) also predicates jurisdiction on an exhaustion of administrative remedies: review is limited to a "final decision of the Secretary made after a hearing to which he was a party." 42 U.S.C. Sec. 405(g) (1976 & Supp. V 1981) (emphasis added). Whereas the first jurisdictional requirement is nonwaivable, the second can be waived by either the Secretary or the courts. Mathews v. Diaz, 426 U.S. at 75-77, 96 S.Ct. at 1889-1890 (1976); see also Eldridge, 424 U.S. at 328, 330, 96 S.Ct. at 899, 900; Jensen v. Schweiker, 709 F.2d 1227 (8th Cir.1983). Here the fundamental question is whether this was an appropriate case for the district court to waive the exhaustion requirement and assert jurisdiction under section 205(g).
The Supreme Court has taken a rather pragmatic approach to statutory finality requirements. The prevailing rule of construction is that crucial collateral claims should not be lost and that irreparable harm should be avoided. 11 In Eldridge the Court recognized that a judicial waiver of the exhaustion requirement was appropriate "where a claimant's interest in having a particular issue resolved promptly is so great that deference to the agency's judgment is inappropriate." Id. 424 U.S. at 330, 96 S.Ct. at 900. This is such a case. 12
First, the claimants have a strong interest in...
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