Wilson v. Heckler

• Citation: 622 F. Supp. 649
• Decision Date: 14 November 1985
• Docket Number: Civ. A. No. 83-3771.
• Parties: John WILSON and Mary Christopher, on their own behalf, and on behalf of others similarly situated, Plaintiffs, v. Hon. Margaret M. HECKLER, Secretary of Health and Human Services, Defendant.
• Court: U.S. District Court — District of New Jersey

622 F. Supp. 649

John WILSON and Mary Christopher, on their own behalf, and on behalf of others similarly situated, Plaintiffs, v. Hon. Margaret M. HECKLER, Secretary of Health and Human Services, Defendant.

Civ. A. No. 83-3771.

United States District Court, D. New Jersey.

October 28, 1985.

Supplemental Opinion Accompanying Order November 14, 1985.

Richard E. Yaskin, Jacobs & Schwalbe, P.C., Voorhees, N.J., for plaintiffs.

Thomas W. Greelish, U.S. Atty. by Laurie J. Gentile, Sp. Asst. U.S. Atty., Newark, N.J., for defendant.

OPINION

BROTMAN, District Judge.

This is an action for declaratory and injunctive relief against the Secretary of Health and Human Services ("Secretary"), challenging her policy of denying or terminating disability benefits under the Supplemental Security Income ("SSI") and Old Age Survivor and Disability Insurance ("OASDI") programs solely on the basis that claimants' impairments are not medically "severe" and without any consideration of each claimant's age, education, work experience, residual functional capacity or ability to return to his or her former work. In July 1985, the Third Circuit declared the Secretary's non-severe impairment regulation, 20 C.F.R. § 404.1520(c), — and, implicitly, the challenged policy — invalid. Baeder v. Heckler, 768 F.2d 547 (3rd Cir.1985).

The Secretary did not appeal the Baeder decision and defends against the instant motions for class certification and preliminary injunctive relief by contending that her new policy, as articulated in an as yet unpublished interpretive ruling, fully complies with the Third Circuit's holding. For the reasons discussed in this opinion, the court finds that the Secretary's new policy directly contradicts the holding of Baeder. Plaintiffs' motions for class certification and preliminary injunctive relief will be granted.

I. Procedural Background

John Wilson initiated this action on October 11, 1983 when he appealed the denial of his application for disability insurance and SSI benefits to this court. That denial was based on a finding that Wilson suffered from no severe medical impairment; the Administrative Law Judge ("ALJ") never considered vocational factors. Plaintiff Mary Christopher was also denied disability and SSI benefits at the administrative level on the grounds of no severe medical impairment without consideration of vocational factors. Christopher's administrative appeal was pending before the Appeals Council when she joined Wilson as a named representative of the proposed class.¹

On October 1, 1984, plaintiffs filed motions for leave to file an amended complaint, preliminary injunctive relief and class certification. After two rounds of briefs, the court heard oral argument on those motions on December 7, 1984 and reserved decision. On February 1, 1985, the court issued an opinion and order which allowed plaintiffs to incorporate new documentary material into the record but did not address the central issues. In August, at the court's request, the parties submitted supplemental comments in light of the Third Circuit's July 24, 1985 decision in Baeder v. Heckler, 768 F.2d 547 (3rd Cir. 1985).

After the Secretary decided not to seek further appellate review of Baeder, she presented to Hon. Clarkson S. Fisher, Chief Judge of the District of New Jersey, an order to show cause why all identified cases pending in the district should not be consolidated and remanded for review in accordance with Baeder. Chief Judge Fisher signed the order on September 16, 1985, making it returnable October 10, 1985.²

In light of Chief Judge Fisher's order, plaintiffs requested that this court accelerate its consideration of the instant motions for class certification and preliminary injunctive relief. At a September 26, 1985 conference with both parties, this court entered an order to show cause, returnable October 9, 1985, why class certification and preliminary injunctive relief should not be granted. On that date, the court also signed an order allowing plaintiffs to file their amended class action complaint.

After oral argument at the October 9, 1985 hearing, this court entered an order which certified the proposed class under Fed.R.Civ.P. 23(a) and 23(b)(2) and instructed the parties to submit a joint proposed order for injunctive relief to the court within three weeks.³

II. Statutory Framework

The Social Security Act ("Act") defines "disability" as "the inability to do any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months." 42 U.S.C. § 423(d)(1)(A). Under the Act, a person is considered disabled "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...." 42 U.S.C. § 423(d)(2)(A).

Regulations promulgated by the Secretary under the Act set forth a five-step sequential evaluation procedure to determine whether a claimant is disabled. 20 C.F.R. § 404.1520(a)-(f). The first step of the sequential evaluation requires the claimant to demonstrate that he is not currently working.⁴ If he is, the claim will be denied at that point. 20 C.F.R. § 404.1520(b). Second, the claimant must show, solely on the basis of medical evidence, that his impairment is "severe." In other words, unless the impairment "significantly limits his physical or mental ability to do basic work activities," the claim will be denied summarily, without reference to the claimant's age, education and work experience. 20 C.F.R. § 404.1520(c).⁵

Third, if the impairment is as severe as those listed in Appendix 1 of the regulations, 20 C.F.R. Part 404, Subpart P, the claimant will receive benefits without regard to vocational factors. 20 C.F.R. § 404.1520(d).⁶ Fourth, if the impairment is less severe than those listed in Appendix 1, the claimant must show that his impairment impedes him from performing his past work. If he can perform his past work, his claim will be denied at this fourth step. 20 C.F.R. § 404.1520(e). Fifth, if the claimant cannot perform his past work, the Secretary must consider his "residual functional capacity" (i.e. the level of work he can perform, based on medical evidence, despite his impairment), age, education, and prior work experience. 20 C.F.R. § 404.1520(f).

In Baeder, the Third Circuit held that the severity regulation, 20 C.F.R. § 404.1520(c), which is the second step of the sequential evaluation, "is inconsistent with the Social Security Act, and therefore, is invalid." Baeder, supra, 768 F.2d at 553. The Baeder court reviewed the regulation's language and history as well as statistical evidence in reaching its decision. This court need not repeat that analysis, except to note that since 1982, "a full forty percent" of disability applicants have been denied benefits without any evaluation of their age, education or past relevant work experience. Id. at 552. The Third Circuit summarized the reasons for its holding as follows:

We believe that section 1520(c) of the regulations does more than allow the Secretary to deny benefits summarily to those applicants with impairments of a minimal nature which could never prevent a person from working. It also allows the Secretary to bypass a full-scale evaluation, which would consider and relate both medical and vocational factors, of an applicant who might actually be entitled to benefits were his age, education and work experience considered. We cannot analyze the severity regulation except according to its plain language and the manner in which the Secretary uses it. We will not rewrite the regulation to make it conform to the statutory mandate, although other courts have directed the Secretary to apply the regulation only to bar the claims of those with de minimis medical complaints.

Id. at 553 (footnotes and citations omitted).

In Baeder, the Secretary tried to justify the severe impairment regulation as a de minimis standard intended only to screen out those applicants whose medical problems "could not possibly prevent them from working." Id. at 552. The Secretary further contended that as applied, the regulation's scope extended to a consideration of vocational factors. The Third Circuit posited that if the Secretary were to apply the regulation in that way, it "might find that it implicitly considered vocational factors and therefore was consistent with the statute." Id. But because the court expressly found that the Secretary was not applying the severity regulation as a de minimis requirement, it did not hesitate to invalidate the regulation.

In the instant case, the Secretary argues that class certification and preliminary injunctive relief are unnecessary because she has voluntarily requested that all pending cases in the District of New Jersey which involve the severity regulation be remanded for review "in accordance with Baeder." Defendant's Supplemental Memorandum at 3. In support of her argument that she intends "to review these claims on remand in a manner acceptable to the Third Circuit," the Secretary proffers a new Social Security Ruling ("new SSR") that was signed on September 17, 1985 and will be issued and applied shortly. The new SSR, as yet unnumbered, purports to interpret and clarify the Secretary's policy regarding the severity of impairments and to reflect recent circuit court decisions, including Baeder. See SSR, Titles II and XVI: Medical Impairments That Are Not Severe, Exhibit I to Defendant's Supplemental Memorandum.

The Secretary's interpretation of Baeder, as outlined in the new SSR, is that the severity regulation may still be applied as a de minimis standard, taking certain vocational factors into account at the second step...