Spragens v. Secretary of Health and Human Services

• Decision Date: 18 December 1992
• Docket Number: No. 91-CV-0173-B.,91-CV-0173-B.
• Citation: 808 F. Supp. 1537
• Parties: Paul E. SPRAGENS (Ref.: S3GCB, XXX-XX-XXXX), Plaintiff, v. SECRETARY OF HEALTH AND HUMAN SERVICES, Defendant.
• Court: U.S. District Court — District of Wyoming

808 F. Supp. 1537

Paul E. SPRAGENS (Ref.: S3GCB, XXX-XX-XXXX), Plaintiff, v. SECRETARY OF HEALTH AND HUMAN SERVICES, Defendant.

No. 91-CV-0173-B.

United States District Court, D. Wyoming.

December 18, 1992.

Paul E. Spragens, pro se.

Aleksander D. Radich, Asst. U.S. Atty., Cheyenne, WY, for defendant.

ORDER

BRIMMER, District Judge.

This matter comes before the Court on August 19, 1992. The Court, having considered the materials on file both in support of and in opposition to the motions, having considered the arguments of counsel, and being fully advised in the premises, FINDS and ORDERS as follows:

Background

The facts of this case are not in dispute. Plaintiff Paul Spragens ("Spragens") is a quadriplegic, has no use of his arms, limited use of his legs, and is unable to walk. He suffers from a condition known as arthrogryposis, a congenital deformity.¹ Spragens filed this action pro se, seeking judicial review of the defendant's ("the Secretary") final decision that his period of disability ceased as of January 1986, because he was engaged in substantial gainful activity ("SGA") within the meaning of Title II of the Social Security Act ("the Act"), codified at 42 U.S.C. §§ 401-33 (1991).

In February 1976, Spragens was awarded disability and disability insurance benefits based on a finding of disability beginning in June 1974 due to arthrogryposis (Adm.Rec. 52). In September 1988, following a continuing disability review, the Social Security Administration ("SSA") made a finding that from January 1986 through December 1986, Spragens' average monthly net income from his work as a free-lance book indexer was $349.26. Because Spragens' net income exceeded $300 per month, the SSA determined that Spragens was engaged in substantial gainful activity and no longer qualified for disability benefits (Adm.Rec. 61-68)². This determination was upheld upon reconsideration (Adm.Rec. 76-77), and, following a hearing (Adm.Rec. 15-47), in a decision by an Administrative Law Judge (ALJ) (Tr. 7-10).³ The Appeals Council adopted the Administrative Law Judges's decision, making it the Secretary's final administrative decision (Adm.Rec. 3-4).

The Secretary has moved the Court to affirm his administrative decision. Spragens has raised an equal protection issue and has moved for summary judgment.

STANDARD FOR REVIEW

Substantial Evidence

Any individual, after any final decision of the Secretary made after a hearing to which he was a party, irrespective of the amount in controversy, may obtain review of such decision by a civil action ... in the district court of the United States for the judicial district in which the plaintiff resides....

The court shall have power to enter, upon the pleadings and transcript of the record, a judgment affirming, modifying, or reversing the decision of the Secretary, with or without remanding the cause for a rehearing.

The findings of the Secretary as to any fact, if supported by substantial evidence, shall be conclusive (emphasis added). ...

42 U.S.C. § 405(g) (1991).

Substantial evidence is defined as `sufficient relevant evidence in the record that a reasonable person might deem adequate to support the ultimate conclusion.'

Potter v. Secretary of Health & Human Services, 905 F.2d 1346, 1348 (10th Cir. 1990) quoting Bernal v. Bowen, 851 F.2d 297, 299 (10th Cir.1988).

Summary Judgment

Summary judgment should be granted if "there is no genuine issue as to any material fact and ... the moving party is entitled to a judgment as a matter of law." Fed. R.Civ.P. 56(c).

In considering a party's motion for summary judgment, the court must examine all evidence in the light most favorable to the nonmoving party. Barber v. General Elec. Co., 648 F.2d 1272, 1276 n. 1 (10th Cir.1981).... Under Rule 56, the initial burden is on the moving party to show the court "that there is an absence of evidence to support the nonmoving party's case." Celotex Corp. v. Catrett, 477 U.S. 317, 325, 106 S.Ct. 2548, 2554, 91 L.Ed.2d 265 (1986). The moving party's burden may be met when that party identifies those portions of the record which demonstrate the absence of a genuine issue of material fact. Id. at 323, 106 S.Ct. at 2553.

Once the moving party has met these requirements, the burden shifts to the party resisting the motion. The nonmoving party must "make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Id. at 322, 106 S.Ct. at 2552; see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 249, 106 S.Ct. 2505, 2510, 91 L.Ed.2d 202 (1986). The party resisting the motion "may not rest upon the mere allegations or denials of his pleadings" to avoid summary judgment. Anderson, 477 U.S. at 248, 106 S.Ct. at 2510. The mere existence of a scintilla of evidence will not avoid summary judgment; there must be sufficient evidence on which a jury could reasonably find for the nonmoving party. Id. at 251, 106 S.Ct. at 2511.

Manders v. Okl. ex rel. Dept. of Mental Health, 875 F.2d 263, 265 (10th Cir.1989).

DISCUSSION

Review of Administrative Decision

The Social Security Administration has a procedure for determining whether a claimant's disability continues or ends under the Act. 20 C.F.R. § 404.1594 (1991). The first step involves a determination of whether there has been medical improvement and if that improvement is related to a claimant's ability to work. Id. at § 404.1594(a). If there has been no medical improvement,⁴ benefits will continue unless an exception applies. Id. One of the exceptions requires a determination of whether the claimant has engaged in substantial gainful activity. 20 C.F.R. § 404.1594(d)(5) (1991). If the claimant has engaged in SGA and any applicable trial work period has been completed, the disability will be deemed to have ended. Id. at § 404.1594(f)(1).

Mr. Spragens' impairment did not improve, so the first step in the evaluation process was a determination of whether Spragens was engaged in SGA. The record shows that Spragens' net income in 1986 from self employment was $6,043 (Adm.Rec. 86, 110). After deducting $1,853 of allowable impairment related work expenses (Adm.Rec. 115), his income was $4,191, or an average of about $349 per month. This exceeded the $300 amount allowable under the regulations and created a presumption that Spragens was engaged in SGA and was no longer eligible to receive benefits. 20 C.F.R. § 404.1574(b)(2)(vi) (1991). Thus, the SSA determined, after a nine month trial work period, which ended in November 1978, and a fifteen month extended period of eligibility, which ended in February of 1982, that Spragens was engaged in SGA (Adm.Rec. 8-9).

Spragens does not disagree with the SSA records regarding his earnings or employment related work expenses, which were the basis for the administrative finding (Adm.Rec. 8-9). Because of Spragens' SGA, the Administrative Law Judge determined that Spragens' disability correctly ceased in January 1986, and that Spragens was overpaid disability insurance benefits by $19,930. Id.

This Court finds that there is substantial evidence in the record to support the administrative finding that Spragens was engaged in substantial gainful activity. Because Spragens was engaged in SGA, he "could not be found disabled, regardless of the severity of his impairments." Fowler v. Bowen, 876 F.2d 1451, 1453 (10th Cir. 1989); see also 20 C.F.R. § 404.1520(b) (1991). For these reasons, the government's motion to affirm the administrative decision is granted.

Equal Protection Challenge

Spragens argues that 42 U.S.C. § 423(d)(4) (1991) violates the equal protection component of the Due Process Clause of the Fifth Amendment.⁵ Section 423(d)(4) states that: "No individual who is blind shall be regarded as having demonstrated an ability to engage in substantial gainful activity on the basis of earnings that do not exceed the exempt amount under section 403(f)(8) of this title which is applicable to individuals described in subparagraph (D) thereof." Under this section, a more lenient monthly earnings test is applied to a person disabled by reason of blindness, as opposed to some other cause, in determining whether that person is engaged in SGA. 42 U.S.C. § 423(d)(4); see also 20 C.F.R. 404.430, 404.1584(d) (1991).

In 1986, a person disabled by blindness could earn up to $650 per month without being engaged in SGA. 20 C.F.R. 404.430(d)(ix) (1991). By contrast, a person disabled by something other than blindness could only earn up to $300 per month without being engaged in SGA. 20 C.F.R. § 404.1574(b)(2)(vi) (1991). Spragens had net earnings of $349.26 per month in 1986. He was determined to be engaged in SGA, and lost all disability benefits. Had Spragens been disabled by reason of blindness, rather than by arthrogryposis, he would not have been engaged in SGA under the guidelines, and would not have lost his disability benefits.

This regulatory scheme creates a classification. People severely disabled by arthrogryposis, having net earnings between $300 and $650 per month, in 1986, were denied disability benefits. Whereas, people disabled by blindness, who earned between $300 and $650 per month, in 1986, received disability benefits.

In the area of social welfare, traditional equal protection analysis requires the challenged classification to be rationally related to some legitimate governmental interest. United States Department of Agriculture v. Moreno, 413 U.S. 528, 93 S.Ct. 2821, 37 L.Ed.2d 782 (1973); City of Cleburne, Texas v. Cleburne Living Center, 473 U.S. 432, 440, 105 S.Ct. 3249, 3254, 87 L.Ed.2d 313 (1985); Schweiker v. Wilson, 450 U.S. 221, 230, 101 S.Ct. 1074, 1080, 67 L.Ed.2d 186 (1981); Hodel v. Indiana, 452 U.S. 314, 331-32, 101 S.Ct. 2376, 2386-87, 69 L.Ed.2d 40 (1981). "This is a two part test: the government interest must be legitimate and the challenged classification must be rationally related to the...