Tustin v. Heckler
| Decision Date | 07 December 1984 |
| Docket Number | No. 84-5507,84-5507 |
| Citation | 749 F.2d 1055 |
| Parties | , 8 Soc.Sec.Rep.Ser. 78, Unempl.Ins.Rep. CCH 15,630 Gale TUSTIN, Milton Ruiz, and Ismael Soto and All Persons Similarly Situated, Plaintiffs-Appellees, v. Margaret HECKLER, Secretary of United States Department of Health and Human Services, Defendant-Appellant. |
| Court | U.S. Court of Appeals — Third Circuit |
David A. Saltman, Julius J. Feinson, Kevin Kovacs (Argued), Newman, Herman, Saltman, Levitt & Feinson, P.A., East Windsor, N.J., for plaintiffs-appellees.
W. Hunt Dumont, U.S. Atty., Newark, N.J., Richard K. Willard, Acting Asst. Atty. Gen., William Kanter, Robert V. Zener (Argued), Attys., Appellate Staff, Civ. Div., Dept. of Justice, Washington, D.C., for defendant-appellant.
Robert Abrams, Atty. Gen. of the State of N.Y., Frederick Mehlman, Paul M. Glickman, Mary Fisher Bernet, Asst. Attys. Gen., New York City, for amicus curiae State of N.Y. in support of plaintiffs.
Before SEITZ, and BECKER, Circuit Judges, and ROSENN, Senior Circuit Judge.
On April 14, 1984, responding to widespread problems in the administration of the Social Security Disability Program and to the expectation that comprehensive legislation would soon be enacted to alleviate these problems, the Secretary of Health and Human Services (the "Secretary") decided to suspend periodic review of disability determinations. The periodic review program had been instituted in 1980 to enable the Secretary to terminate the disability benefits of persons who, upon reevaluation, were found to be capable of engaging in substantial gainful employment. As part of the decision to suspend periodic review, the Secretary restored benefits to individuals whose periodic review cases had not received final administrative decisions. The Secretary did not, however, restore benefits to individuals whose benefits had been terminated pursuant to the review procedure and whose appeals were pending in the federal courts. 1
The plaintiffs, persons in this latter group, brought suit in the district court for the District of New Jersey seeking injunctive relief on behalf of all similarly situated individuals, and challenging on equal protection grounds the Secretary's decision to distinguish between disability review cases on the basis of whether the claimants had received final administrative determinations. On July 12, 1984, finding that the requirements of Fed.R.Civ.P. 23(b)(2) were met, the district court certified a nationwide class comprising all individuals with appeals from adverse periodic review disability determinations pending in the federal district courts. The district court also decided that, because the distinction relied on by the Secretary was "chimerical," her decision did not meet the (applicable) rational relation test and was unconstitutional. Accordingly, the district court granted a preliminary injunction requiring the Secretary to restore benefits to the class.
Concluding that the district court erred in declaring the Secretary's decision unconstitutional, we now vacate its order granting a preliminary injunction. Although the court's class certification does not give rise to an appealable order, we remand so that the district court may decide whether to vacate the class certification in light of our decision on the merits.
In 1980, Congress amended the Social Security Act to require review of the eligibility of each disability beneficiary at least once every three years. 2 Implementation of this rather straightforward mandate has, however, been controversial. Central to the controversy has been the lack of a national standard for reviewing cases to determine whether continued disability benefits are warranted. Initially, the Secretary adopted a standard of review that required termination of benefits when the current evidence of record supported a finding that the person was able to engage in substantial gainful activity. See 45 Fed.Reg. 55,566, 55,568 (Aug. 20, 1980). This standard was challenged in court, however, and several courts of appeals concluded that the Secretary's standard was improper, although these courts disagreed among themselves as to the appropriate standard of review. 3 As a result, several standards of review have been applied to disability redeterminations, so that a person's eligibility has depended as much on one's state of residence as on one's condition of disability.
Responding to these "significant problems and dislocations," and "reaffirming [a] commitment to and insistence upon a nationally uniform disability insurance program," S.Rep. No. 98-466, 98th Cong., 2d Sess. 6, 9 (1984), the 98th Congress, true to the Secretary's expectations, enacted legislation establishing a uniform standard for disability reviews. 4 This legislation was signed into law by the President on October 9, 1984. Although the enacted statute provides the named plaintiffs and class members with some of the relief that they would otherwise receive as a result of the district court's injunction in this case, it does not moot this appeal. 5 We therefore turn to the Secretary's April 1984 decision.
After considering the substantial problems inherent in administering a national disability program with widely varying eligibility standards and the apparently imminent enactment of a comprehensive disability standard, 6 the Secretary announced that the Social Security Administration (SSA) would suspend the disability review process until the legislation was enacted and implemented. See Appendix at 4. The Secretary also directed the SSA to restore current and retroactive benefits to all individuals with claims pending at the administrative level. See id. On May 22, 1984, a Ruling was issued by the Acting Commissioner of SSA to implement the Secretary's announcement. The Acting Commissioner specified that "determinations and decisions of disability cessation for medical reasons" would be rescinded for:
[i]ndividuals who have not received an Appeals Council decision or notice denying a request for review by the Appeals Council of the administrative law judge decision on their periodic review claims and who have such claims properly pending in the Department. People who, as of the effective date of this policy, still have time to appeal the determination to stop their benefits to the next administrative review level also will have their [disability] determinations rescinded."
The Ruling did not rescind adverse decisions and restore benefits for [i]ndividuals who received an Appeals Council decision or notice denying review and those whose claims were not properly pending administratively ... as of [April 13, 1984].... Similarly, cases pending in the Federal courts for review of a final agency decision ... are not subject to the Secretary's policy even if a court has remanded the case for further administrative action.
Id. at 17. 7
The Ruling by the Acting Administrator outlined the following three reasons for the agency's actions: (1) the disability review program was suspended because "the SSA cannot effectively administer the ... program in the fair and humane way that the agency desires"; (2) restoration of benefits to individuals with claims pending in the administrative process was considered "particularly justified" because of "[t]he absence of ... an opportunity [to pursue their periodic review claims] and of a final agency decision by the Appeals Council"; and (3) benefits were not restored to individuals with "cases pending in the Federal courts for review of a final agency decision" because those individuals have "pursued [their] periodic review claim[s] through all steps of the administrative review process." Id. at 16-17. 8
The three named plaintiffs in this case, Gale Tustin, Milton Ruiz, and Ismael Soto, had their disability benefits terminated by the Secretary pursuant to the periodic review procedure. Their individual appeals of the disability terminations were pending in the district court for the District of New Jersey at the time that the Secretary made her decision to restore disability benefits to persons with pending administrative disability determinations. These plaintiffs then brought this separate action in the same court on behalf of themselves and all other persons with appeals of disability determinations then pending in any United States district court. The plaintiffs sought a declaration that the Secretary's failure to rescind their terminations and to restore their benefits was a violation of the equal protection component of the due process clause of the fifth amendment; 9 they also sought injunctive relief.
After a hearing on the merits, the district court granted the plaintiffs request for a preliminary injunction. The court concluded that the Secretary based the classification on a "chimerical" distinction between disability recipients, and held that the "criterion ... bears no rational relationship to a legitimate legislative goal." Tustin v. Heckler, 591 F.Supp. 1049, 1061 (D.N.J.1984).
The court also certified a nationwide class pursuant to Fed.R.Civ.P. 23(b)(2). The court's order defined the class as:
all persons nationwide who have had their Social Security disability benefits terminated for reasons having to do with the evaluation of a medical condition pursuant to a periodic review conducted under Section 221(i)(1) of the Social Security Act and who presently have a claim appealing said termination pending in a United States District Court.
Appendix at 68 (Order of July 12). According to the Secretary, there are between 9,000 and 11,250 members in this class. Brief for Appellant at 14 n. 7.
After the district court issued its July 12 order, the Secretary moved for a stay. On July 24, 1984, the court granted the stay until ...
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