Pulido v. Heckler

Decision Date02 August 1983
Docket NumberCiv. A. No. 82-M-1143.
Citation568 F. Supp. 627
PartiesGenaro PULIDO, et al., Plaintiffs, v. Margaret M. HECKLER, Secretary of Health and Human Services, Defendant.
CourtU.S. District Court — District of Colorado

Daniel M. Taubman, Colo. Coalition of Legal Services Programs, Laura Shapiro, Colo. Rural Legal Services, Denver, Colo., David G. Kroll, Colo. Rural Legal Services, Greeley, Colo., R. Eric Solem, Pikes Peak Legal Services, Colorado Springs, Colo., Jacqueline

Higinbotham, Colo. Rural Legal Services, Fort Morgan, Colo., for plaintiffs.

John R. Barksdale, Asst. U.S. Atty., Jay A. Swope, Asst. Regional Atty., Dept. of Health and Human Services, Denver, Colo., for defendant.

MEMORANDUM OPINION AND ORDER

MATSCH, District Judge.

This is a class action to compel the Secretary of Health and Human Services ("the Secretary") to engage in notice and comment rulemaking concerning the disability insurance benefits program under Title II of the Social Security Act ("the Act"), 42 U.S.C. § 401 et seq., and the supplemental security income program under Title XVI of the Act, 42 U.S.C. § 1381 et seq. Jurisdiction is found in 42 U.S.C. § 405(g).

The plaintiff class consists of all persons residing in the State of Colorado who have requested or will request administrative law judge hearings and who have been, are being, or will be adversely affected in presenting applications for receipt or continued receipt of benefits under Titles II or XVI of the Act, because of (1) the Secretary's failure to use formal1 rulemaking procedures to establish standards for the determination of "good cause" supporting requests to have hearing locations changed pursuant to 20 C.F.R. § 404.936 or § 416.1436, or (2) the Secretary's failure to promulgate regulations regarding the payment of travel expenses pursuant to 42 U.S.C. § 401(j) or § 1383(h). The relevant and material facts have been presented by stipulation and the parties filed cross motions for summary judgment.

Title II of the Act provides for the payment of disability insurance benefits to eligible individuals defined as "disabled" under 42 U.S.C. § 423(d). Title XVI of the Act provides supplemental security income for "aged, blind or disabled" individuals meeting the income and resources criteria of 42 U.S.C. § 1382-1382e. 42 U.S.C. § 405(a) confers upon the Secretary the "full power and authority to make rules and regulations and to establish procedures" for carrying out the provisions of Title II of the Act. 42 U.S.C. § 405(b) defines the administrative procedure for the determination of disability benefits, including the right to a hearing with respect to the Secretary's "disability" decisions. 42 U.S.C. § 1383(d)(1) expressly makes 42 U.S.C. § 405(a) applicable to Title XVI of the Act. 42 U.S.C. § 1383(c)(1) is substantially identical to 42 U.S.C. § 405(b).

The regulations published in 20 C.F.R. § 404.900 et seq., prescribe the procedures to be followed by the Social Security Administration in determining rights under Title II of the Act. 20 C.F.R. § 404.900(a) provides that, subsequent to the initial determination and reconsideration process, a dissatisfied claimant may request a hearing before an administrative law judge. The time and location of the hearing are determined under 20 C.F.R. § 404.936 which provides, in pertinent part:

(a) The administrative law judge sets the time and place for the hearing. He or she may change the time and place, if it is necessary. After sending the parties reasonable notice of the proposed action, the administrative law judge may adjourn or postpone the hearing or reopen it to receive additional evidence any time before he or she notifies the parties of a hearing decision ... (b) If you object to the time or place of the hearing, you must notify the administrative law judge in writing at the earliest possible opportunity before the time set for the hearing. You must state the reasons for your objection and the time or place you want the hearing to be held. The administrative law judge may change the time or place for the hearing if you show good cause for the change (emphasis added).
20 C.F.R. § 416.1400 et seq. enumerates similar administrative procedures for the determination of rights under Title XVI of the Act. 20 C.F.R. § 416.1436 is substantially identical to 20 C.F.R. § 404.936.

In scheduling benefit hearings under Titles II and XVI of the Act, the administrative law judges have used an informal "seventy-five mile" policy. This agency standard generally prohibits the scheduling of a hearing at locations within seventy-five miles of the hearing office. (See Administrative Directives System Guide 240-51, Sec. 5 (hereinafter cited as ADS Guide 240-51), Exhibit C to Amended Complaint). As of November, 1982, administrative exceptions to this informal policy could be granted only where (1) the alternative hearing site would result in little or no cost to the government, (2) a full day's caseload would be heard at the hearing site, and, (3) the use of the hearing site would result in greater productivity. (See May, 1982 Memorandum from SSA Regional Management Officer, Exhibit C to Amended Complaint; Exhibit F, Memorandum in Support of Motion for Summary Judgment). In addition, "hardship" exceptions to this agency standard may be recognized upon a showing of "good cause." 20 C.F.R. §§ 404.936, 416.1436. The Secretary has not, however, engaged in formal, "notice and comment" rulemaking to define what shall, or may, constitute "good cause" for a hearing location change. (See Stipulation, para. 3).

Both Titles II and XVI of the Act provide for the payment of certain travel expenses "to parties, their representatives, and all reasonably necessary witnesses for travel within the United States to attend reconsideration interviews and proceedings before administrative law judges with respect to any determination" under the applicable title. 42 U.S.C. §§ 401(j), 1383(h) (citations omitted). With respect to Title II proceedings, reimbursement has been limited to travel expenses incurred in attending administrative hearings scheduled more than seventy-five miles from the claimant's residence. (ADS Guide 240-51, Sec. V(A)(1)(b)). Pursuant to a 1981 House Resolution, a similar limitation was imposed upon Title XVI expense reimbursements.2 On January 15, 1981, the Commissioner of the Social Security Administration published a notice of proposal to issue regulations implementing Section 310 42 U.S.C. §§ 401(j), 1383(h) of Public Law 96-265. 46 Fed.Reg. 3547 (1981). The purpose of the proposed regulations was to "describe the policies and procedures applicable to paying certain travel expenses including limitations on the use of first-class air travel." Id. Although classified as "policy significant," no further action on this regulatory proposal has been taken. (Stipulation, para. 5).3

The parties have presented two separate questions. First, is the Secretary under a duty to engage in formal, "notice and comment" rulemaking to establish standards for the determination of "good cause" for changes in the time and place of hearings before administrative law judges? Second, is the Secretary under a duty to promulgate such regulations regarding the payment of travel expenses pursuant to 42 U.S.C. § 401(j) and 1383(h)?

"Good Cause"

The statutory right to a hearing before an administrative law judge after denial of an application for disability or supplemental income benefits is granted in 42 U.S.C. § 405(b) and 42 U.S.C. § 1383(c)(1). The Secretary's administrative regulations governing such hearings are codified in 20 C.F.R. § 404.900 et seq. and 20 C.F.R. § 416.1429 et seq. Those regulations include a provision for a change in the time and place for a scheduled hearing upon a showing of "good cause." 20 C.F.R. § 404.936; 20 C.F.R. § 416.1400. In practice, the administrative law judges have applied this regulation in a manner which has failed to consider the specific circumstances of individual claimants. The plaintiffs contend that this constitutes "arbitrary" agency action which denies the statutory right to a hearing and which infringes the constitutional right to due process of law.

An administrative agency is not required to promulgate detailed rules interpreting every statutory provision which may be relevant to its actions. West v. Chafee, 560 F.2d 942, 947 (8th Cir.1977). See also American Power & Light Co. v. SEC, 329 U.S. 90, 67 S.Ct. 133, 91 L.Ed. 103 (1946); SEC v. Chenery Corp., 332 U.S. 194, 67 S.Ct. 1575, 1760, 91 L.Ed. 1995 (1947). As a general rule, the choice between rulemaking and case-by-case adjudication "is one that lies primarily in the informed discretion of the administrative agency." SEC v. Chenery Corp., supra, at 203, 67 S.Ct. at 1580. See also Nueces County Nav. Dist. No. 1 v. ICC, 674 F.2d 1055, 1065 (5th Cir.1982), cert. denied, ___ U.S. ___, 103 S.Ct. 446, 74 L.Ed.2d 601 (1982); NLRB v. American Can Co., 658 F.2d 746, 758 (10th Cir.1981).

Section 405(a) of the Act, expressly made applicable to Title XVI by 42 U.S.C. § 1383(d)(1), provides:

The Secretary shall have full power and authority to make rules and regulations and to establish procedures, not inconsistent with the provisions of this title, which are necessary or appropriate to carry out such provisions, and shall adopt reasonable and proper rules and regulations to regulate and provide for the nature and extent of the proofs and evidence and the method of taking and furnishing the same in order to establish the right to benefits hereunder (emphasis added).

In this statute, Congress empowers the Secretary to issue rules and regulations, not inconsistent with the provisions of the Act, which are necessary or appropriate to implement the program of benefits and commands the Secretary to adopt rules and regulations establishing the necessary procedures for determining the right to benefits.

The setting of the time and place for a hearing before an...

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