Summary of the Acquiescence Rulings

AR 86-2R(2) “Deemed” Spouse Entitled to Benefits If Legal Spouse Receives Less Than Full Benefits

This revision of AR 86-2(2) applies only for benefits payable in months prior to January of 1991, at which time Public Law 101-508 authorized the payment of benefits to both a legal and “deemed” spouse. see Section 5119 of P.L. 101-508, 42 U.S.C. 416(h)(1)(B).

For benefits payable prior to 1991 in the Second Circuit, under Rosenberg v. Richardson, 538 F.2d 487 (2nd Cir. 1986), and Capitano v. Secretary of HHS, 732 F.2d 1066 (2nd Cir. 1984), “deemed” spouses (based upon a “good faith marriage”) are entitled to the difference between a “full” spouse’s benefits and any reduced amount which a “legal” spouse is receiving.

AR 86-3(5) Illiteracy and Inability to Communicate in English Not Covered by the Grids

This Ruling reports the case of Martinez v. Heckler, 735 F.2d 795 (5th Cir. 1984). Here the Fifth Circuit ruled that an individual who is both illiterate and unable to communicate in English does not fall within Rule 201.23 of the Medical-Vocational Guidelines, which covers individuals 18 to 44 years old who are illiterate or unable to communicate in English. Therefore, under the circumstances, the Secretary’s reliance on this rule is error.

This Ruling applies in the Fifth Circuit only, and the Secretary also agrees not to rely on Rule 202.16 (younger individuals with unskilled or no work history and illiterate or unable to communicate in English). Martinez conflicts with Social Security’s longstanding policy “that the Rules applying to individuals who are illiterate or unable to communicate in English also apply to those who are illiterate and unable to communicate in English.”

AR 86-4(3) Disability Termination Improper During Pendency of Approved Vocational Rehabilitation

Reporting the case of Paskel v. Heckler, 768 F.2d 540 (3rd Cir. 1985), this Ruling indicates that, in the Third Circuit, the Secretary will not terminate or suspend disability benefits as long as 1) the individual is participating in an approved vocational rehabilitation program and 2) Social Security determines that completion of that program will increase the likelihood of claimant being permanently removed from the disability rolls. These conditions must be met prior to continuation, regardless of whether or not medical recovery was expected at the beginning of the claim.

AR 86-5(9) Disability Termination Improper During Pendency of Approved Vocational Rehabilitation

This Ruling acquiesces to the Ninth Circuit case of Leschniok v. Heckler, 713 F.2d 520 (9th Cir. 1983). As in AR 86-4(3), Social Security is precluded from suspending disability benefits regardless of whether medical recovery was expected as long as 1) the individual is participating in an approved vocational rehabilitation program and 2) Social Security determines that completion of that program will increase the likelihood of the claimant being permanently removed from the disability rolls.

This Ruling, as well as the previous one, differs from Social Security’s policy in that Social Security interprets Congressional intent as providing for non-termination of benefits only where medical improvement was not expected at the time the disability claim was granted.

AR 86-6(3), 86-7(5), 86-8(6), 86-9(9), 86-10(10), 86-11(11) Presumption of Death Applies Once Claimant Shows An Individual Has Been Absent For 7 Years And Has Not Been Heard From

Rescinded. These Acquiescence Rulings were rescinded on July 14, 1995, at 60 Fed. Reg. 36327 in light of a newly issued regulation (60 Fed. Reg. 19163, 4/17/95). The new regulation (20 CFR 404.721(b)) provides that a presumption of death arises when a claimant establishes that an individual has been absent from his or her residence and not heard from for seven years. Once established, the burden shifts to Social Security to rebut the presumption either by presenting evidence that the person is still alive, or by providing an explanation to account for the individual’s absence in a manner consistent with continued life rather than death.

AR 86-12(9) State Law Applies in Determining the Definition of a “Step Child”

The issue in this case is the definition of a “step child” for purposes of entitlement to Child’s Insurance Benefits. In the case of Hutcheson v. Califano, 638 F.2d 96 (9th Cir. 1981), the Ninth Circuit held that the state law of the insured wage earner’s domicile at the time the application is filed (or at the time he died) determines the definition of a “step child.”

This case conflicts with Social Security’s position, which interprets Section 202(d)(a) of the Act, such that if the wage earner adopts a child after he becomes entitled to old-age benefits, dependency requirements must be met unless the child is the insured’s natural child or step child.

In the Hutcheson case, the Ninth Circuit noted that since Washington law defined a step child as “a child of the Petitioner’s spouse who is not a child of the Petitioner,” under this definition, the child was entitled to Child’s Benefits as a “step child.” Again, this is different from Social Security’s policy, which is that a person may be eligible for Child’s Benefits as the insured’s step child only if the child’s natural or adopting parent marries the insured after the child’s birth.

AR 86-13(3), 86-14(4), 86-15(6) In Considering “Contributions” to the Support of Illegitimate Child, SSA Must Consider the Worker’s Means, As Well As the Income of the Family in Which the Child Resided

In AR 86-13(3), Social Security acquiesces to the case of McNeal v. Schweiker, 711 F.2d 18 (3d Cir. 1983), which held that the proper test for contributions is whether the contributions were regular and substantial in relation to the worker’s income and the child’s need.

This differs from Social Security’s policy which requires contributions that are both regularly made and large enough to meet an important part of the applicant’s ordinary living costs. Social Security generally attaches little relevance to the worker’s financial circumstances.

In Acquiescence Ruling AR 86-14(4), Jones v. Secretary of HEW, 629 F.2d 334 (4th Cir. 1980) also holds that the proper test is whether wage earner contributions were regular and substantial in relation to the worker’s income and the child’s need. This is also the holding in AR 86-15(6) in the cases of Boyland v. Califano, 633 F.2d 430 (6th Cir. 1980), Parker v. Schweiker, 673 F.2d 160 (6th Cir. 1982), Childress v. Secretary of HHS, 679 F.2d 623 (6th Cir. 1982).

AR 86-17(9) A Child’s Status is Determined by State Law at the Time of the Secretary’s Determination

Rescinded: 63 FR 57727; 10/28/98. This AR was based on Owens v. Schweiker, 692 F.2d 80 (9th Cir. 1982). Subsequent regulations liberalized the determination of “child” status for benefit purposes where the child was born out of wedlock and needs to show intestate inheritance rights under applicable state law. [20 CFR §§404.354-356; 63 FR 57590, 10/28/98] The new test applies in both life and death claims and is more generous than the court-made rule in the Ninth Circuit, allowing the rescission of this Acquiescence Ruling.

AR 86-18R(5), AR 86-19R(11) Termination of a Widow’s Benefits Due to Her Remarriage Does Not Preclude a Second Individual On the Basis of a “Deemed Marriage”

These two Rulings have been revised in accordance with Public Law 101-508, Section 5119, which permits payment of benefits to both a “legal spouse” and “deemed spouse”. 42 U.S.C. 416(h)(1)(B). A “spouse” is defined as a wife, divorced wife, widow, surviving divorced wife, husband, divorced husband, widower, or surviving divorced husband.

Since P.L. 101-508 is effective for benefits payable after December of 1990, benefits payable prior to 1991 are subject to these Acquiescence Rulings for the 5th and 11th Circuits, based on Woodson v. Schweiker, 656 F.2d 1169 (5th Cir. 1981). This case held that once a previously entitled legal widow lost her status as a “widow” within the meaning of Section 216(a)(1)(B) due to a remarriage, a second “deemed” wife was entitled to benefits. This case holding conflicted with Social Security’s interpretation that the remarriage did not end the status as a “legal widow” within the meaning of the Act, and therefore no “deemed” benefits were payable prior to 1991.

AR 86-20(6) The Absence of an Entry of Self-Employment Income Does Not Create a Conclusive Presumption of No Self-Employment Earnings (Under Limited Circumstances)

In Grigg v. Finch, 418 F.2d 661 (6th Cir. 1969), Grigg had not filed his own self- employment tax return for the years 1956 and 1957. However, IRS Forms 1099 were filed by the “employer” reflecting payments for those years. The Court held that the Form 1099s were sufficient to give the Secretary actual or constructive notice under Section 42 U.S.C. 405(c)(5)(F). This contrasts with Social Security’s official position that the absence of an entry of self-employment income in the worker’s earnings record is conclusive evidence that no such income was earned during that year. [20 C.F.R. 404.803(c)(3), 404.822(b)(2)]

AR 86-21(2), 86-22(4), 86-23(9) In Assessing an Unborn Child’s Eligibility for Child’s Benefits, “Contributions for Support” are Determined by the Needs of the Unborn Child

In these three related Acquiescence Rulings, the Ninth Circuit goes slightly farther than the Fourth and Second Circuits in holding that Social Security’s “regular” and “continuous” test of support is less relevant than whether the father’s support for an unborn child was commensurate with the needs of the unborn child at the time of the father’s death. In Doran v. Schweiker, 681 F.2d 605 (9th Cir. 1982), the Ninth Circuit also held that the economic circumstances of the worker must be taken into account when making a determination.

Doran relied on the facts 1) that the father and mother contributed to rent and food from each other’s funds, and 2) that the father repaired the mother’s roof during a rain storm. These facts were sufficient to establish the necessary contributions of support as set forth in section 216(h)(3)(C)(ii) of the Social Security Act [42 U.S.C. 416(h)(3)(C)(ii)].

The Ninth Circuit holding, as well as the other two circuits’ decisions, conflicts with Social Security Regulation 20 C.F.R. Section 404.366(a), which indicates that “contributions for support” must be made regularly and must be substantial. Social Security’s policy was previously set out in SSR 68-22. The other two Circuit Court cases are Adams v. Weinberger, 521 F.2d 656 (2nd Cir. 1975) and Parsons v. HHS, 762 F.2d 1188 (4th Cir. 1985).

AR 86-25(9) Offset Effectuation Does Not Apply To Determinations Or Decisions Made Before July 1, 1981

In interpreting Section 1127 of the Social Security Act (42 U.S.C. 1320(a)(6), 20 C.F.R. 404.408(b), the Ninth Circuit case of Fagner v. Heckler, 779 F.2d 541 (9th Cir. 1985), held that the date of the ALJ’s final decision is the date of “determination” for purposes of the offset provisions. Social Security had taken the position that it was the date of the award certificate, not the administrative decision, that was the “determination” set forth in the applicable statute. Thus, in this case, the Ninth Cir. held that the offset provisions did not apply because the ALJ’s favorable decision had been rendered on June 25, 1981, prior to the effective date of the statute, July 1, 1981.

This Acquiescence Ruling will have very little practical impact since there are very few, if any, non-effectuated decisions made prior to July 1, 1981, although advocates may wish to consider application of the Secretary’s re-opening provisions in appropriate instances.

AR 87-2(11) The Appeals Council May Not Reopen and Revise a Favorable ALJ Decision After the 60-Day Time Limit for “Own Motion” Review Unless the Claimant Has Requested Review

Rescinded. This Acquiescence Ruling, based on Butterworth v. Bowen, 796 F.2d 1379 (11th Cir. 1986), has been rescinded. [63 FR 36726; 7/7/98]

The AR challenged the ability of the Appeals Council to extend the 60-day time limit for taking a case on own-motion review by using instead the separate regulatory provision allowing reopening “for any reason” within 12 months of the initial determination, or later for “good cause.”

SSA states that the Appeals Council is not bound by the normal 60-day time limit to initiate action, and can use the reopening rules to gain more time. As a result, the Acquiescence Ruling based on the former state of the regulations has been rescinded:

The final rules provide . . . that if the Appeals Council is unable to decide within the applicable 60-day period whether to review a decision or dismissal, it may consider at a later time whether the decision or dismissal should be reopened . . . [T]he appeals Council’s authority to reopen and revise ALJ decisions is not limited by the 60-day period . . . [63 FR 36727; 7/7/98]

Thus, in a regulation headed “Authority to Review Cases On Its Own Motion,” the Appeals Council asserts its authority to review cases outside the own-motion time period. SSA states only that this use of the reopening regulations requires satisfaction of their separate requirements.

AR 87-4(8) Sheltered Workshop Earnings Exceeding $300 Per Month Present No Positive Presumption of SGA

Rescinded. 65 F.R. 42793 (7/11/00)

This Acquiescence Ruling was rescinded on July 11, 2000, to correspond with new regulations for the evaluation of work activity published on the same date. 65 F.R. 42771 (7/11/00).

The SGA presumption figure, currently $700 when the regulations were published, will be applied to both sheltered and non-sheltered work – cancelling the Eighth Circuit view that there was no presumption of ongoing Substantial Gainful Activity where sheltered earnings exceeded the test amount.

The Eighth Circuit case which had been the subject of the AR is Iamarino v. Heckler, 795 F.2d 59 (8th Cir. 1986).

AR 88-1(11) The Age Factor Includes a Mandatory Re-Assessment of the Effect of the Physical or Mental Impairment on One’s Ability to Adapt to a New Environment

Rescinded: 65 FR 18143; 4/6/00. This AR was based on Patterson v. Bowen, 799 F.2d 1455 (11th Cir. 1986), an unusual case in which the Eleventh Circuit permitted use of an older age category where impairments have increased the negative vocational impact of aging.

A regulation change aimed precisely at Patterson and published on the same day clarifies that only chronological age may be used to position an applicant on the “grids” for the final step of sequential analysis. 65 FR 17993; 4/6/00. According to SSA, the regulation change allowed the agency to cancel its acquiescence in the Patterson precedent of the Eleventh Circuit.

AR 88-3(7) Disability May Be Established Even Where Claimant Returned to Work Within One Year of Impairment

Rescinded: On March 27, 2002, the U.S. Supreme Court upheld SSA’s interpretation of the basic definition of disability where work resumes within 12 months and SSA is adjudicating the disability claim at any later time. Barnhart v. Walton, 122 S.Ct. 1265 (2002). As a result, SSA rescinded the related Acquiescence Rulings for the four Circuits where a more liberal interpretation of the work incentives was applied. The deleted ARs are AR 00-5(6), AR 98-1(8), AR 92-6(10) and AR 88-3(7). 67 FR 39781; 6/10/02.

Advocate Reminder: Walton does not prevent establishment of a Title II period of disability and recognition of a trial work period where (1) work resumes within 12 months but after the waiting period and after claim adjudication; or (2) work resumes after 12 months – even if claim adjudication occurs later. 20 CFR 404.1592(d).

AR 88-4(1) Windfall Offset Provision Inapplicable Where Beneficiary Met the Statutory Criteria Prior to July of 1981, With a Resulting Payment Made Prior to February of 1985

Dion v. Secretary of HHS, 823 F.2d 669 (1st Cir. 1987) is a case with remote applicability. It interprets an outdated statute, section 1127 of the Social Security Act [42 U.S.C. 1320(a)(6)]. However, since this statute was amended, retroactive benefits paid after January of 1985 fall under the new statute.

According to the original offset provision, offsets between Title II and Title XVI benefits arose where entitlement to Title II benefits was “determined” on or after July 1, 1981. Social Security interpreted “determined” to mean “finally adjudicated, i.e. the date the claims authorizer signs an award determination.”

However, Dion disagreed, interpreting “determined” as the date on which a beneficiary met the statutory criteria, even if the claim was not finally adjudicated until a later date. Thus, where an individual received an award of benefits under Title II for months prior to July of 1981, with a resulting payment prior to February of 1985, the offset provision is not applicable in the First Circuit. [In the Ninth Circuit, see AR 86-25(9)].

AR 88-6(8) An Individual is Not a Public Institution Inmate If Residing at Such Facility on a Voluntary Basis and Paying for All Services Provided

Levings v. Califano, 604 F.2d 591 (8th Cir. 1979) evaluates 20 C.F.R. 416.201 regarding the SSI definition of a “resident of a public institution,” such a category disqualifying an individual for SSI. 20 C.F.R. 416.211. Levings held that under section 1611(e)(1)(A) of the SSA [42 U.S.C. 1382(e)(1)(A)], a person is not an “inmate” if he or she 1) is confined in such an institution voluntarily and 2) pays for all services provided. Furthermore, for applicants, the intent to pay charges from subsequent SSI benefits will meet this second requirement.

Levings reasoned that the term “inmate” refers to persons confined in institutions under some form of restraint. It also cited 20 C.F.R. 416.221(b)(3), which talks of an individual who “receives” treatment, as opposed to someone who “purchases” treatment and services.

This decision differs from Social Security’s policy that, in the technical sense, the term “inmate” is a “person lodged with others, and often confined, in an institution, asylum, etc.” Thus, Social Security defines the term “inmate” as not being limited to involuntary confinement and includes individuals who reside voluntarily in a public institution.

AR 90-1(9) Augmented VA Benefits Not Counted as SSI Income

Rescinded. AR 90-1(9) was rescinded on November 17, 1994 [59 F.R. 59416] in light of new regulations promulgated on the same date [59 F.R. 59362]. 20 C.F.R. §416.1123 provides that when an individual receives Veterans Benefits which includes an amount paid because of a dependent, the dependent’s portion does not count as SSI income for the veteran.

However, contrary to Paxton v. Secretary of HHS, 856 F2d. 1352 (9th Cir. 1988), this regulation treats the dependent portion as income for the dependent, if the dependent resides with the veteran, or if the dependent receives a separate payment from the Department of Veteran Affairs.

AR 90-2(2) Rental Subsidies Not SSI In-Kind Income Unless “Actual Economic Benefit” Received

This Second Circuit Acquiescence Ruling discusses Ruppert v. Bowen, 871 F.2d 1172 (2nd Cir. 1989). Multiple SSI recipients had filed a joint action challenging the methods used by Social Security to calculate their benefits.

Ruppert held that the statute and regulations concerning in-kind income and rental subsidies are facially valid. However, if the proportion of income that an SSI recipient expends on housing is “so great that it flies in the face of reality” to conclude that unearned income (as subsidized housing) is actually available to the recipient, the unearned income should be disregarded. Thus, Ruppert required that Social Security determine the “actual economic benefit” received by a recipient in rental subsidy cases, although it did not specify the test to be used.

Ruppert differs from Social Security’s current policies. In situations where the landlord/tenant relationship is other than that of a parent/child, Social Security presumes that the amount of monthly rent required to be paid equals the current market rental value. However, where there is a parent/child relationship between landlord and tenant, Social Security determines whether a rental subsidy exists. Any difference between the current market rental value and the actual amount of rent paid is generally counted as in-kind income, up to the presumed value established under 20 C.F.R. 416.1140(a)(1) (one-third of the Federal benefit rate plus the $20.00 general income exclusion).

However, in the Second Circuit, where Social Security finds that an applicant or recipient has received a rental subsidy, Social Security will determine whether that individual received an “actual economic benefit” from the rental subsidy. Social Security will find that an applicant or recipient did not receive an “actual economic benefit” from a rental subsidy when the monthly amount of rent required to be paid equals or exceeds the presumed maximum value set forth above. If the required amount of rent is less than the presumed maximum value, Social Security will impute as in-kind support and maintenance the difference between the rent paid and either the presumed maximum value or the current market rental value, whichever is less.

AR 90-3(4) A Vocational Expert May Not Be Called to Determine Whether a Claimant Can Return to Past Relevant Work

Rescinded. SSA has clarified that a VE is not limited to providing evidence at sequential step 5 on the claimant’s ability to adapt to alternate jobs. Further, at step 4, the VE is not limited to providing evidence on the claimant’s past relevant work as normally performed in the national economy. Once the VE hears the ALJ’s hypothetical RFC restrictions, the witness can match the claimant to past work as that work was actually performed or as generally performed. 68 F.R. 51317; 8/26/2003. This former AR acquiesced in Smith v. Bowen, 837 F.2d 635 (4th Cir. 1987).

AR 90-4(4) Administrative Finality Waived In Prior Proceedings for Unrepresented Claimants Lacking the Mental Competence to Request Administrative Review

The Secretary acquiesces to two Fourth Circuit cases, Culbertson v. Secretary of HHS, 859 F.2d 319 (4th Cir. 1988), and Young v. Bowen, 858 F. 2d 951 (4th Cir. 1988). Essentially, the holdings in Culbertson and Young require that Social Security reopen an otherwise final administrative determination at any time for previously unassisted claimants who establish that mental incompetence prevented them from understanding the procedures necessary to request administrative review. Claimants must establish a prima facie case of mental incompetence, demonstrating that the claimant lacked both 1) mental competence and 2) an individual “legally responsible” (e.g., a parent of a minor claimant, legal guardian, or attorney) to provide the legal assistance necessary to appeal the prior determination.

In the Fourth Circuit, if the adjudicator determines that a prima facie case is sufficiently conclusive to establish the claimant’s lack of mental competence, then he or she will not apply res judicata or administrative finality, but will reopen the prior determination and issue a revised determination. If there is a question of the sufficiency of the prima facie case, the adjudicator will hold an evidentiary hearing to determine the claimant’s mental competence at the time of the prior determination.

Culbertson held that the Secretary may not utilize the administrative finality regulations in such a fashion as to “deny a per se mentally impaired claimant a full and fair opportunity to establish a statutory entitlement” to benefits.

In Young, the Fourth Circuit stated that “It offends fundamental fairness … to bind the claimant to an adverse ruling who lacks both the mental competency and the legal assistance to contest an initial determination.”

The Fourth Circuit policy differs from Social Security’s policy such that a final determination or decision can be reopened only for a reason listed in 20 C.F.R. 404.988(c) or 20 C.F.R. 416.1488(c) for Title II and Title XVI cases respectively. The regulations do not provide that a final determination or decision can be reopened and revised at any time if the claimant establishes that he or she lacked the mental competence and representation necessary to request administrative review.

[Editor’s Note: In the Ninth Circuit, see Gregory v. Bowen, 844 F.2d 664 (9th Cir. 1988).]

AR 91-1(5) The Right To Subpeona a Physician For Cross-Examination Is Absolute

This Acquiescence Ruling adopts Lidy v. Sullivan, 911 F.2d 1075 (5th Cir. 1990) such that “in the Social Security hearings process the right to subpoena for the purposes of cross-examining an examining physician is absolute.” The Lidy decision is based upon an interpretation of Richardson v. Perales, 402 U.S.C. 389 (1971), which had interpreted Section 205(d) of the Social Security Act. (42 U.S.C. 405(d)).

The policy in the Fifth Circuit differs from Social Security’s interpretation of Richardson. Accordingly to Social Security’s normal policy, the issuance of a subpeona is required only when the testimony sought “is reasonably necessary for the full presentation of a case.” Social Security’s criteria are set out at 20 C.F.R. 404.950(d) and 416.1450(d), in essence requiring a claimant to document why certain “facts could not be proven without issuing a subpeona.”

In the Lidy case the ALJ did permit the claimant to submit a set of written interrogatories to a worker’s compensation examining physician. Claimant then sought to submit a second set of interrogatories, and he urged the ALJ to require live cross-examination. Both requests were denied, along with claimant’s application for benefits.

This Acquiescence Ruling does note one exception to Social Security’s regular policy, pertaining to the securing of an expert medical opinion after a hearing. Thus, “Section I-2-540 [of HALLEX] states that if the claimant objects to the use of interrogatories and requests a supplemental hearing, the Administrative Law Judge must grant the request in such event.”

AR 92-1(3) SSI Will Be Paid First In All Concurrent Application Cases

This Acquiescence Ruling adheres to the Third Circuit case of Mazza v. Secretary of HHS, 903 F.2d 953 (3d Cir. 1990). Thus, in the Third Circuit only, when an individual is determined eligible for retroactive SSI and DIB, the SSI Benefits will be paid first. Subsequently, the individual’s Title II Benefits will be offset by the amount of retroactive SSI payments received for the appropriate period.

Social Security’s normal policy applies the offset to whichever benefits are paid second. Accordingly, either Title II or SSI may be offset. However, in the Third Circuit only, retroactive SSI will be paid first in all instances. Mazza finds this practice “in accordance with statutory intent”, thereby protecting claimant’s eligibility for Medicaid.

AR 92-2(6) In Disability Cessations The Adjudicator Must Consider A Claimant’s Condition At The Time Of The Adjudication

This Acquiescence Ruling adopts the Sixth Circuit case of Difford v. Secretary of HHS, 910 F.2d 1316 (6th Cir. 1990). Difford held that the adjudicator must consider an individual’s condition at the time of the adjudication (e.g. hearing), as well as at the time of cessation.

Difford differs from Social Security’s policy, which considers a claimant’s condition only at the time disability is judged to have ceased. If a claimant’s condition gets worse after that cessation determination, Social Security’s policy is that an “adjudicator solicits a new application.”

AR 92-4(11) An Appeals Council Dismissal For Untimely Filing Is “Final Decision” And Subject To Judicial Review

Rescinded and replaced by AR 99-4(11). 64 F.R. 57687 (10/26/99)

AR 92-5(9) In Overpayment Determinations, “Against Equity and “Good Conscience” Must Consider All Of The Facts and Be Based Upon a Broad Concept of Fairness

This Ninth Circuit Acquiescence Ruling adopts Quinlivan v. Sullivan, 916 F.2d 524 (9th Cir. 1990) concerning the meaning of the term “against equity and good conscience”.

Quinlivan held that “The meaning of the phrase ‘against equity and good conscience,’ cannot be limited to the three narrow definitions set forth in the Secretary’s regulation.” Rather, Quinlivan interpreted Congress’ intent as requiring “a broad concept of fairness to apply to waiver requests.” As such, in the Ninth Circuit Social Security may not confine itself to the situations set out at 20 C.F.R. 404.509(a), 410.561d, and 416.554.

Quinlivan differs from Social Security’s policy that recovery of an overpayment is “against equity and good conscience” only if the overpaid individual changed his or her position for the worse, relinquished a valuable right due to reliance upon a payment, or lived in a separate household from the overpaid person (Title II) or his or her eligible spouse (Title XVI) and did not receive the overpayment.

In the Ninth Circuit, in determining whether recovery of an overpayment would be “against equity and good conscience”, “The decision must take into account all of the facts and circumstances of the case and be based on a broad concept of fairness. Factors such as, but not limited to, the nature of the claimant’s impairment, the amount and steadiness of the claimant’s income, and the claimant’s assets and material resources should all be considered in the decision as to whether recovery of an overpayment should be waived on the basis that recovery would be ‘against equity and good conscience.’”

Cross reference: AR 88-2(8)

AR 92-6(10) A Return To Substantial Gainful Activity Within 12 Months Of Onset Does Not Automatically Preclude An Award Of Benefits

Rescinded. On March 27, 2002, the U.S. Supreme Court upheld SSA’s interpretation of the basic definition of disability where work resumes within 12 months and SSA is adjudicating the disability claim at any later time. Barnhart v. Walton, 122 S.Ct. 1265 (2002). As a result, SSA rescinded the related Acquiescence Rulings for the four Circuits where a more liberal interpretation of the work incentives was applied. The deleted ARs are AR 00-5(6), AR 98-1(8), AR 92-6(10) and AR 88-3(7). 67 FR 39781; 6/10/02.

AR 92-7(9) Unappealed Initial Determinations Must Be Reopened At Any Time When The Notice Does Not Explicitly State That Failure To Seek Reconsideration Will Result In A Final Determination

This Ninth Circuit Acquiescence Ruling follows Gonzalez v. Sullivan, 914 F.2d 1197 (9th Cir. 1990). Gonzalez permits reopening of initial determinations at any time if the notice does not advise the claimant that failure to appeal will result in a “final” determination.

This Acquiescence Ruling has potential impact for all initial denials issued (at least) prior to February of 1990, at which time Social Security completed implementation of new notice language. AR 92-7(9) differs from Social Security’s policy that its prior notices did provide claimants procedural due process, and that the current reopening regulations are valid.

Gonzalez had received a notice indicating, among other things, that “If you do not request reconsideration of your case within the prescribed time period, you still have the right to file another application at any time.” The Ninth Circuit held that the notice violated Gonzalez’ Fifth Amendment right to procedural due process since “The notice given in this case does not clearly indicate that if no request for reconsideration is made, a determination is final.”

Thus, within the Ninth Circuit only, a new determination based on the merits of the claim must be issued in accordance with 20 C.F.R. 404.992 or 416.1492 under the following conditions: 1) the claimant received a notice “like that received by Mr. Gonzalez”, 2) the claimant files a subsequent application, and 3) claimant either requests reopening of the prior initial determination or requests some or all the benefits claimed in the prior application. Under these circumstances “the time limits for reopening or revising final agency determinations do not apply.”

Editors Note: Outside the Ninth Circuit, see Brown v. Sullivan, 932 F.2d 1243 (8th Cir. 1991), 33 SSRS 387; Babola v. Sullivan, 753 F.Supp 729 (ND Il. 1991), 32 SSRS 203.

AR 93-1(4) A Medical Inability To Perform Past Relevant Work Constitutes a “Significant Work-Related Limitation of Function” Under Section 12.05C of the Listing of Impairments

Rescinded. 65 F.R. 50784 (8/21/00)

This Acquiescence Ruling, along with AR 98-2(8), was rescinded on August 21, 2000, to correspond with new regulations for the evaluation of mental impairments published on the same date. 65 F.R. 50745 (8/21/2000).

The new regulations restate SSA’s policy under listing 12.05C that there must be a separate physical or mental impairment, other than mental retardation, that imposes an additional restriction of work capacity. As before, the additional impairment need not be disabling itself.

Historical Note: On April 29, 1993, AR 93-1(4) was published in the Federal Register (58 FR 25996) to reflect a regulatory change that extended the IQ listing range in section 12.05C from “60 to 69″ to “60 through 70.” As a result AR 93-1(4) was the reworded and renumbered replacement for AR 92-3(4). Although AR 92-3(4)had been off the books for more than seven years, the rescission notice for AR 93-1(4) and AR 98-2(8) also re-rescinded AR 92-3(4).

Cross reference (also rescinded): AR 98-2(8)

AR 93-2(2) Following the Reentitlement Period, a Determination of Substantial Gainful Activity (SGA) Must Average Monthly Earnings. Social Security May Not Find SGA Based on a Single Month’s Earnings

Rescinded. 65 F.R. 42793 (7/11/00)

This Acquiescence Ruling was rescinded on July 11, 2000, to correspond with new regulations for the evaluation of work activity published on the same date. 65 F.R. 42771 (7/11/00).

The new regulations confirm that income averaging and the concept of an unsuccessful work attempt may not be used after the disabled worker completes the Trial Work Period and enters the Extended Period of Eligibility, nor after the EPE has ended.

AR 93-3(6), AR 93-4(2), AR 93-5(11) Attorney Fees for Federal Court Work May Include Interim (Continued) Benefits Paid During a Cessation Appeal

Rescinded. 65 F.R. 20239 (4/14/00)

These Acquiescence Rulings were based on the following three cases: (1) Akers v. Secretary of HHS, 966 F.2d 205 (6th Cir. 1992); (2) Condon and Brodner v. Bowen, 853 F.2d 66 (2nd Cir. 1988); and (3) Shoemaker v. Bowen, 853 F.2d 858 (11th Cir. 1988).

When these court decisions came out, past-due benefits for fee purposes did not include interim benefits paid during a cessation appeal, but only as to services before the agency. There was no similar exclusion of interim benefits when calculating a fee for court services. The Act was amended in 1994 to close this loophole, invalidating these ARs, and SSA has finally taken them off the books.

AR 93-6(8) A Presumption of Death Arises If a Person Disappears For Seven Years. Social Security Must Provide Evidence To Rebut This Presumption

Rescinded. This Acquiescence Ruling, along with six similar ARs based on decisions in other Circuits, was rescinded on July 14, 1995, at 60 Fed. Reg. 36327 in light of a newly issued regulation (60 Fed. Reg. 19163, 4/17/95). The new regulation (20 CFR 404.721(b)) provides that a presumption of death arises when a claimant establishes that an individual has been absent from his or her residence and not heard from for seven years. Once established, the burden shifts to Social Security to rebut the presumption either by presenting evidence that the person is still alive, or by providing an explanation to account for the individual’s absence in a manner consistent with continued life rather than death.

AR 94-1(10) Child’s Benefits – Contributions to Posthumous Illegitimate Child May Establish Deemed Child Status

Joining Acquiescence Rulings 86-21(2), 86-22(4), and 86-23(9), Social Security has acquiesced to the Tenth Circuit case of Wolfe v. Sullivan, 988 F.2d 1025 (10th Cir. 1993). Wolfe follows the favorable Ninth Circuit case of Doran v. Schweiker, 681 F.2d 605 (9th Cir. 1982) (AR 86-23(9)) concerning the degree to which contributions for support may determine dependency status under Title II of the Social Security Act.

In this case claimant’s child had been born following the death of the wage earner, whom the mother had never married. Social Security took the position that, in order for the child to qualify for benefits, the worker had to have made “substantial” and “regular” contributions to the support of the mother or child at the time of the worker’s death.

Wolfe held that the proper test for “contributing to the support” of a posthumous illegitimate child is whether the father’s contributions were commensurate with the needs of the unborn child at the time of the father’s death. Contrary to Social Security policy, Wolfe also held that the economic circumstances of the worker must be considered when making such a determination. Moreover, support may be shown by establishing that contributions were made to either the unborn child (e.g., baby clothes or a crib) or the mother (e.g., food, shelter or medical care).

Wolfe also held that such financial contributions must have been made with knowledge of the pregnancy. Expenditures intended merely for courtship of the mother do not constitute contributions for support of the unborn child.

Unfortunately for the claimant in this case, the factual evidence did not show that the father had contributed anything to the child’s or mother’s support after he learned of the pregnancy. Significantly, the father was not living with the mother, nor did he make any contributions to the support of mother or child, at the time of his death. Therefore no benefits were payable.

Wolfe followed the Ninth Circuit case of Doran (AR 86-23(9)) in rejecting the Secretary’s stricter test for dependency. Unlike Wolfe, in Doran the father’s contributions, helping move the mother to a new abode and making repairs to her roof, did amount to significant financial contributions. As such, the father was found to be “contributing to the support” of the child at the time of the father’s death.

Wolfe differs from Social Security’s policy that “contributions for support” must be made regularly and must be substantial. To be considered “substantial”, such contributions must be large enough to meet an important part of the ordinary living costs of the claimant. “Under SSR 68-22, and SSA’s Operating Instructions, the ‘living’ or ‘contributing to the support’ requirements are established for the posthumous child of a worker if the worker was living with, or contributing to the support of, the child’s mother at the time of the worker’s death.”

In the Tenth Circuit, Social Security will apply the standards set out in Wolfe. In this region “the proper test for contributions is whether the father’s support was commensurate with the needs of the unborn child at the time of the father’s death, taking into account the father’s economic circumstances at the time of his death.”

Pertinent statutory and regulatory sections are found at 42 U.S.C. 416(h)(3)(C)(ii), 20 CFR 404.366(a)(2), as well as Social Security Ruling 68-22 (not independently summarized in SSAS).

AR 94-2(4) Prior “Final” Findings of Fact are Binding on Subsequent Decision Makers Unless There is New and Material Evidence Relating to Such a Finding

Rescinded and replaced by AR 00-1(4) 65 F.R. 1936 (1/12/2000)

Social Security originally acquiesced to the Fourth Circuit case of Lively v. Secretary of HHS, 820 F.2d 1391 (4th Cir. 1987). Lively held that prior administrative findings of fact made by an Administrative Law Judge (ALJ) or the Appeals Council, are binding on subsequent Social Security decisions under the same title of the Social Security Act “unless there is new and material evidence relating to such a finding.”

However, the 4th Circuit has since determined that AR 94-2(4) is an overly broad interpretation of its Lively holding. Albright v. Commissioner, 174 F.3d 473 (4th Cir. 1987) See the annotation for AR 00-1(4) for additional details.

AR 95-1(6) “Highly Marketable Skills” Are Those Sufficiently Coveted by Employers To Give Older Claimants (Age 60-64) an Advantage Over Younger Claimants in Obtaining Employment

Rescinded: 65 FR 18144; 4/6/00. This AR was based on Preslar v. Secretary of HHS, 14 F.3d 1107 (6th Cir. 1994), in which the 6th Circuit required the Secretary to consider additional factors under the medical-vocational guideline definition of “highly marketable skills” for individuals close to retirement age (60-64).

A regulation change published on the same day deleted the separate references to “highly marketable skills” for workers at age 60 and above. 65 FR 17993; 4/6/00.

According to SSA, these applicants are covered by the existing skill transfer requirement that “there must be very little, if any, vocational adjustment required in terms of tools, or processes, work settings or the industry.” 20 CFR Part 404, Subpart P, App.2, Section 202.00(f). At least three Circuits had used the separate reference to “highly marketable skills” to add an employability test for workers closely approaching retirement age; contrary to the disability evaluation factors permitted by the Act.

AR 95-2(9) In Determining The Proper Workers’ Compensation Offset, An Oregon Lump Sum Scheduled Award Should Be Pro-Rated Over The Working Life Of The Claimant

Social Security has acquiesced to the Ninth Circuit Case of Hodge v. Shalala, 27 F.3d 430 (9th Cir. 1994). Hodge interpreted Oregon law to ascertain the appropriate monthly rate of a scheduled lump sum Oregon Workers’ Compensation award.

Initially the ALJ found that because the Oregon lump sum award did not specify an offset rate, the pro-ration should be based on the prior temporary periodic rate, $344.77 per week. The District Court held that the “scheduled” loss awards were not substitutes for periodic payments and therefore were not offsetable at all.

The Ninth Circuit reversed the District Court and found that an offset should be applied. However, the proper offset rate, based on Oregon Workers’ Compensation law, is calculated by pro- rating the lump sum award over the Social Security “working life” of the claimant, which ends at 65. In other words, “the monthly offset amount should be equal to Hodges’ lump sum award divided by the number of months between the date of award and the date Hodge reaches the age of 65.”

This Acquiescence Ruling applies only to Oregon Workers’ Compensation settlements. Individuals must be living in the Ninth Circuit, and the settlement must fail to express an offset rate “under the Oregon Statutory Scheme.” However, Hodge provides general support for an extended pro-ration of comp. settlements, and downplays the applicability of POMS pro-ration guidelines.

AR 96-1(6) In Determining A Child’s Status Under 42 U.S.C. 416(h)(2)(A), Social Security Must Apply State Law In Effect At The Time Of Its Determination, Rather Than The Time Of The Worker’s Death, Including Changes In State Law

DeSonier v. Sullivan, 906 F.2d 228 (6th Cir. 1990), reviewed the denial of Child’s Benefits by an ALJ, who found that Amanda DeSonier was not the deceased wage earner’s child. The ALJ properly considered the laws of Texas, where the father died. However, in denying the claim for Child’s benefits, the ALJ applied Texas law in effect prior to the date of the wage earner’s death. As such, he concluded that Amanda was not the father’s child under Texas law as required by 42 USC 416(h)(2)(A).

The Sixth Circuit Court of Appeals agreed with the Ninth Circuit case of Owens v. Schweiker, 692 F.2d 80 (9th Cir. 1982), holding that “in determining an applicant’s status under [42 USC 416(h)(2)(A)] the Secretary is required to apply the state intestacy law in effect at the time of his decision rather than at the time of the wage earner’s death.” The Sixth Circuit also adopted the Third Circuit principle set out in Morales on Behalf of Morales v. Bowen, 833 F.2d 481 (3rd Cir. 1987), “that the Secretary must determine the time at which the State fixes intestate rights and must apply the statute that would be applied by the state’s courts.”

In applying Texas law, DeSonier held that Texas courts would have applied the amendments following the wage earner’s death in determining the child’s inheritance rights. As such, the case was remanded for Social Security to reconsider the child’s application under current Texas law.

DeSonier differs from Social Security’s policy which “looks to the laws that were in effect at the time the insured worker died in the State where the insured had his or her permanent home.” (20 CFR 404.354(b)). In the Sixth Circuit only, “adjudicators must consider all changes in the State law through the time of the determination or decision in any level of administrative review… to determine the child’s entitlement to benefits… and must apply amendments to State intestacy laws in the same manner as the State court would apply the changes.”

AR 97-1(1) For An Individual Simultaneously Entitled To Benefits On Two Earnings Records, Social Security Will Consider Only The Amount of Monthly Benefits Actually Due or Payable To That Individual

Rescinded: 64 F.R. 57774; (10/27/99).

The family maximum limits the total benefits payable concurrently on a single earnings record. In a disability case, the family maximum is typically fixed at 150% of the PIA. As a result, a disabled worker receiving $1,000 as a disability benefit will be allowed another $500 for qualified auxiliaries. Since just one spouse or child can receive a benefit that uses up the entire family maximum, a new policy announced by SSA is important:

If a family member is receiving a higher benefit on his or her own earnings record, that auxiliary is removed from the family maximum calculation, leaving more funds for distribution to other beneficiaries on the disabled worker’s account. 64 F.R. 57774; (10/27/99). The new rules follow the First Circuit decision in Parisi by Cooney v. Chater, 69 F.3d 614 (1st Cir. 1995), allowing rescission of this related Acquiescence Ruling based on the same case.

In the Parisi case, the wage earner’s son was receiving benefits based on the earnings record of his disabled father. Social Security later reduced these benefits on account of his mother’s entitlement to wife’s benefits. However, because the mother’s retirement benefits were higher than she could receive in wife’s benefits, the mother was receiving retirement benefits based on her own earnings record.

Parisi interpreted the Social Security Act as limiting the total amount of benefits “actually payable on a single worker’s record, not the amount of entitlement theoretically available.” Because the “wife’s benefits resulted in ‘zero payable benefits’ under [§ 42 U.S.C. 402(k)(3)(A)], none of her benefits should be included in the family maximum computation required under section [403(a)].” This is now the national interpretation adopted in October 1999.

AR 97-2(9) An Individual Claimant Meets Listing Section 1.10C When He Or She Cannot Afford A Prosthesis

Rescinded. Acquiescence Ruling 97-2(9) has been rescinded, as part of a rewrite of the musculoskeletal listings. 66 FR 58010, 58047; 11/19/01. AR 97-2(9) was based on Gamble v. Chater, 68 F.3d 319 (9th Cir. 1995), which required special consideration of an applicant’s inability to afford a replacement prosthesis following a lower extremity amputation.

The new listing focuses more narrowly on medical issues, and concedes the inability to walk without a prosthesis in these cases, rendering moot the reason why a prosthesis is not available.

AR 97-3(11) In Determining Eligibility for Child’s Benefits, Social Security’s Application of Georgia’s Intestacy Scheme Violates Claimant’s Equal Protection Rights

In the Eleventh Circuit Social Security follows Daniels on Behalf of Daniels v. Sullivan, 979 F.2d 1516 (11th Cir. 1992). Claimant Daniels, who was born out of wedlock, applied for child’s insurance benefits. To establish his eligibility under 42 USC 416(h)(2)(A), Claimant had to demonstrate “the same status relative to taking intestate personal property as a child” would under Georgia law.

At the time Georgia law “provided that a child born out of wedlock may inherit from or through his father . . . only if the criteria specified in the statute are satisfied ‘during the lifetime of the father and after conception of the child.’” However, because Daniels’ alleged father (the wage earner) died in a car accident, paternity could not be determined “during” his lifetime. Therefore, based on Georgia law, Social Security found that Daniels was not entitled to child’s insurance benefits.

In reversing Social Security’s decision, Daniels found that “where the father died less than two and one-half years after [Claimant’s] birth, the requirement that paternity be established during the lifetime of the father effectively imposed an unconstitutional insurmountable barrier which denied appellant the equal protection of the laws…” Therefore, Social Security’s “application” of that statute to the specific facts of the case when determining Daniels’ eligibility for Social Security survivors benefits violated equal protection.”

For Eleventh Circuit cases interpreting that particular Georgia statute, Social Security permits “a period of 2 ½ years from the date of birth of the applicant for the commencement and resolution of legitimacy proceedings before applying a statutory requirement that requires an illegitimate child to establish paternity during the lifetime of the father.”

Georgia law currently is different from the one considered by Daniels. As indicated in Footnote 2 of this Acq. Ruling, “A 1991 amendment, not applicable in this case, expanded the time frame for establishing paternity to include the period when proceedings on the father’s estate are pending.”

AR 97-4(9) Prior Findings in Unfavorable Disability Hearing Decisions are Entitled to Res Judicata Effect Unless the Claimant Demonstrates Changed Circumstances

In the Ninth Circuit Social Security adhere to the principles set out in Chavez v. Bowen, 844 F.2d 691 (9th Cir. 1988). Chavez discussed the evidentiary weight of prior findings in unfavorable disability decisions made by an ALJ or the Appeals Council. Chavez held that the principle of res judicata applies to these prior administrative decisions, although “less rigidly” than in judicial proceedings.

When Chavez first applied for benefits, a 1983 ALJ decision adknowledged that he could not return to his past relevant work, but it found that he could perform other “light” work. As such, he was considered not disabled.

Chavez reapplied for benefits, and less than a year later, a second ALJ found that he could perform his past relevant work and therefore was “not disabled.” This decision made no reference to the findings contained in the first ALJ decision; nor did it consider whether res judicata might apply on the issue of Claimant’s ability to perform his past relevant work.

The Ninth Circuit overturned the second ALJ decision, holding that “the first Administrative Law Judge’s findings concerning the Claimant’s residual functional capacity, education and work experience are entitled to some res judicata consideration in subsequent proceedings.” However, the first ALJ decision could be modified by “changed circumstances.” Specifically, Chavez’ subsequent attainment of age 55 was a “changed circumstance” since, under the Medical/Vocational Guidelines, at age 55 Claimant could be found disabled under Rule 202.02.

(While not mentioned in this Acquiescence Ruling, the Ninth Circuit remanded the case to the Secretary on the issue of whether or not Claimant possessed transferable skills to “light” work.)

The Chavez holding differs from Social Security’s national policy, which “considers the issue of dfisability with respect to the unadjudicated period to be a new issue that prevents the application of administrative res judicata … SSA does not adopt findings from the final determination or decision on the prior disability claim [including] any presumption of a continuing condition of non-disability.”

In the Ninth Circuit, However, Social Security will give res judicata effect to an ALJ’s non-disability “findings of the claimant’s residual functional capacity, education, and work experience… Ajudicators must adopt such a finding from the final decision on the prior claim in determining whether the claimant is disabled with respect to the unadjudicated period unless there is new and material evidence relating to such a finding or there has been a change in the law, regulations or rulings affecting the finding or the method for arriving at the finding.”

AR 98-1(8) A Return To Substantial Gainful Activity Within 12 Months Of Onset and Before Benefit Award Does Not Automatically Preclude An Award Of Benefits

AR 98-2(8) A Medical Inability To Perform Past Relevant Work Constitutes a “Significant Work-Related Limitation of Function” Under Section 12.05C of the Listing of Impairments

Rescinded. 65 F.R. 50784 (8/21/00)

This Acquiescence Ruling, along with AR 93-1(4), was rescinded on August 21, 2000, to correspond with new regulations for the evaluation of mental impairments published on the same date. 65 F.R. 50745 (8/21/2000).

Cross reference (also rescinded): AR 93-1(4)

AR 98-3(6), AR 98-4(6) Prior “Final” Findings of Fact are Binding on Subsequent Decision Makers Unless There is New and Material Evidence Relating to Such a Finding

Social Security has acquiesced in two very similar Sixth Circuit cases: Dennard v. Secretary, 907 F.2d 598 (6th Cir. 1990) [AR 98-3(6)] and Drummond v. Commissioner, 126 F.3d 837 (6th Cir. 1997) [AR 98-4(6)].

In these cases, the Sixth Circuit essentialy adopts the Lively approach of the Fourth Circuit, set out in AR 94-2(4). Whether the issue previously decided is the applicant’s RFC or the ability to perform past work, SSA will acquiesce in Sixth Circuit states as follows:

“When adjudicating a subsequent disability claim with an unadjudicated period arising under the same title of the Act as the prior claim, adjudicators must adopt such a finding from the final decision by an ALJ or the Appeals Council on the prior claim in determining whether the claimant is disabled with respect to the unadjudicated period unless there is new and material evidence relating to such a finding or there has been a change in the law, regulations, or rulings affecting the finding or the method for arriving at the finding.”

Dennard and Drummond differ from Social Security’s national policy that, when adjudicating a subsequent disability claim involving a subsequent unadjudicated period, Social Security must consider the facts and issues de novo in determining disability. Social Security normally does not apply the principle of administrative res judicata under these circumstances.

Cross references: AR 94-2(4) and AR 97-4(9)

AR 98-5(8) Covered Employment: Stipend Paid to Medical Residents; Application of Student Exclusion

This AR deals specifically with disputed Social Security tax coverage of stipends paid to medical residents attending a state university in Minnesota. AR 98-5(8) is based on State of Minnesota v. Apfel, 151 F.3d 742 (8th Cir. 1998) More generally, the court directs SSA to make a careful study of all circumstances involved when applying the student exclusion in §210(a)(10) of the Act, criticizing the “bright line” approach used in SSR 78-3.

AR 99-1(2) SSI: Parent-to-Child Deeming; Ineligible Stepparent

SSA acquiesces in the Second Circuit’s decision in Florez obo Wallace v. Callahan, 156 F.3d 438 (2nd Cir. 1988). [See the extended SSAS annotation of the Florez case.] For parent-to- child deeming in SSI cases, Florez holds that the income of an ineligible stepparent should not be deemed to the child after the natural parent leaves the household, even if the stepparent continues to support the child.

In reaching this result, the Second Circuit sought to promote the willingness of stepparents to assume child rearing and support responsibilities in this difficult circumstance. Outside the Second Circuit states, SSA will continue to deem income from a stepparent to a child in the same household, regardless of the natural parent’s whereabouts, until the marriage ends.

AR 99-2(8), AR 99-3(5) Skill Transfer: Closely Approaching Retirement Age – Highly Marketable Skills

Rescinded: 65 FR 18144; 4/6/00. These ARs were based on Kerns v. Apfel, 160 F.3d 464 (8th Cir. 1998) and McQueen v. Apfel, 168 F.3d 152 (5th Cir. 1999), which required the Secretary to consider additional factors under the medical-vocational guideline definition of “highly marketable skills” for individuals close to retirement age(60-64).

A regulation change published on the same day deleted the separate references to “highly marketable skills” for workers at age 60 and above. 65 FR 17993; 4/6/00.

AR 99-4(11) An Appeals Council Dismissal For Untimely Filing Is A “Final Decision” And Subject To Judicial Review

This Acquiescence Ruling adopts the 11th Circuit case of Bloodsworth v. Heckler, 703 F.2d 1233 (11th Cir. 1983), which held that an Appeals Council dismissal is a “determination on the merits” and therefore subject to judicial review.

Bloodsworth differs from Social Security’s policy that an Appeals Council dismissal is not a “final decision of the Secretary made after a hearing”. Accordingly, Social Security continues to take the position – in circuits other than the Eleventh – that such a dismissal is not judicially reviewable under 42 U.S.C. 405(g).

AR 99-4(11) replaces AR 92-5(11), which included a parenthetic note that the threshold determination of the A.C. (either to review an ALJ decision or to decline a request for review) is judicially reviewable. As with dismissals by the A.C., Social Security holds that the A.C. selection of cases to review is a process not subject to court scrutiny, at least on non-Constitutional grounds.

AR 00-1(4) “Final” Findings of Fact Must be Considered in a Later Claim and May be Highly Probative in the Absence of New & Material Evidence

The Fourth Circuit and Social Security continue a 20-year “dialog” on what weight should be given to findings in a prior claim when a new claim is filed. SSA has rescinded its prior AR for the Fourth Circuit on this issue [AR 94-2(4)], replacing it with an acquiescence in the Fourth Circuit’s 1999 decision of Albright v. Commissioner, 1774 F.3d 473 (4th Cir. 1999).

In the absence of new and material evidence, findings in a prior and final determination may be highly probative and entitled to great evidentiary weight when a new claim involves the same facts and issues, especially where relatively little time has elapsed since the period covered by the prior findings. As noted by the Fourth Circuit, a key purpose of this doctrine is to support the “legitimate expectations of claimants *** that final agency adjudications should carry considerable weight.”

Albright differs from Social Security’s national policy that, when adjudicating a subsequent disability claim involving a subsequent unadjudicated period, Social Security must consider the facts and issues de novo in determining disability. Social Security normally does not apply the principle of administrative res judicata under these circumstances.

In the Ninth Circuit, see Chavez v. Bowen, 844 F.2d 691 (9th Cir. 1988).

AR 00-2(7) Medical Equivalence: Only Professional Medical Evidence May Be Considered

Rescinded: 71 F.R. 10584; 3/1/06. Final regulations effective since March 31, 2006, clarify that determinations of medical equivalence to the Listings are based on a broad concept of “medical evidence.” In addition to medical reports, SSA considers other information about the medical condition such as its effects and the individual’s own description of his or her impairment. The revised regulations are favorable to claimant’s, and have allowed SSA to end its acquiescence in the more narrow view of the Seventh Circuit in 1999. Hickman v. Apfel, 187 F.3d 683 (7th Cir. 1999).

AR 00-3(10) Vocational Expert Testimony: ALJ Must Review Any Discrepancy Between VE Testimony and DOT, and Must Seek an Explanation for Discrepancies Found

Rescinded. The standard established by AR 00-3(10) now applies nationwide, with the publication of Social Security Ruling 00-4p. As a result, this AR has been rescinded. 65 F.R. 75759; 12/4/2000.

AR 00-4(2) Agency Burden to Establish Residual Functional Capacity

Rescinded. SSA has clarified its disability regulations on the agency burden to establish RFC. Social Security makes the usual RFC determination as part of sequential step 4, when determining the claimant’s ability to resume past relevant work. The same RFC finding is then applied at step 5; i.e., SSA has no new RFC evidence responsibilities at that step. The only burden shift to SSA at step 5 is the duty to match the claimant’s RFC and vocational profile (age, education & skills) to alternate jobs in the economy. 68 F.R. 51317; 8/26/2003. This former AR acquiesced in Curry v. Apfel, 209 F.3d 117 (2d Cir. 2000).

AR 00-5(6) A Return to Substantial Gainful Activity Within 12 Months of Onset Does Not Automatically Preclude an Award of Benefits

Rescinded. On March 27, 2002, the U.S. Supreme Court upheld SSA’s interpretation of the basic definition of disability where work resumes within 12 months and SSA is adjudicating the disability claim at any later time. Barnhart v. Walton, 122 S.Ct. 1265 (2002). As a result, SSA rescinded the related Acquiescence Rulings for the four Circuits where a more liberal interpretation of the work incentives was applied. The deleted ARs are AR 00-5(6), AR 98-1(8), AR 92-6(10) and AR 88-3(7). 67 FR 39781; 6/10/02.

Advocate Reminder: Walton does not prevent establishment of a Title II period of disability and recognition of a trial work period where (1) work resumes within 12 months but after the waiting period and after claim adjudication; or (2) work resumes after 12 months – even if claim adjudication occurs later. 20 CFR 404.1592(d).

AR 01-1(3) Grids as a “Framework” at Step Five: Additional Evidence Required

According to the Third Circuit, use of the grid rules at step 5 as a “framework” for the decision process is insufficient to meet the agency burden to provide substantial evidence of alternate jobs. In cases that include nonexertional impairments, additional evidence must support a denial, such as VE testimony or “similar evidence,” and the claimant must have a fair opportunity for rebuttal. Sykes v. Apfel, 228 F.3d 259 (3rd Cir. 2000). According to this AR, an ALJ may no longer rely on SSRs 96-9 and 83-14 to make a form finding that nonexertional impairments “do not significantly erode the remaining occupational base” described by the framework grid rule.

AR 04-1(9) SSI Childhood Disability: Medical Specialist Requirement

When Congress revised the standards for SSI childhood disability claims in 1996, the new law required the Commissioner to have the claim evaluated by a pediatrician or other appropriate specialist when making “any determination.” SSA interprets this provision to require specialist input at the initial and reconsideration levels only, since ALJs and the Appeals Council render decisions rather than determinations. The Ninth Circuit disagrees, finding that Congress intended a deference to specialist expertise in OHA proceedings as well. Howard v. Barnhart, 341 F.3d 1006 (9th Cir. 2003).

AR 04-1(9) notes that ALJs in the Ninth Circuit are not required to use a medical expert in every SSI childhood disability appeal. ALJs can still rely on the analysis prepared earlier by a specialist at the state agency. The record must include the specialist’s qualifications, and the decision must explain how the specialist’s evaluation was considered. This AR should encourage ALJs to use a medical expert when the medical record has been significantly developed after the reconsideration determination.

AR 05-1(9) Survivor Benefits: Posthumous Children

Social Security has acquiesced in the Ninth Circuit’s 2004 decision awarding survivor benefits to posthumous “frozen sperm babies.” Gillett-Netting v. Barnhart , 371 F.3d 593 (9th Cir. 2004) A legitimate or adopted child is conclusively presumed to have been dependent on its parent at the time of the parent’s death. Act, §402(d)(3). The agency is struggling to adjust its traditional take on dependent children to the advances of modern biology. Robert Netting died some ten months before his widow used his frozen sperm to conceive twins. It is clear that these posthumous children did not receive 50% or more of their support from the father at the time the father died, since their conception occurred after his death. Also, the mother was legally “unmarried” at the time the twins were born. Social Security denied their claims for surviving child’s benefits on these grounds, but the Ninth Circuit has ordered a benefit award.

In every state, a child conceived or born during a valid marriage is presumed to be legitimate. However, Robert Netting died in Arizona, where distinctions based on legitimacy have been abolished: “Every child is the legitimate child of its natural parents and is entitled to support and education as if born in lawful wedlock.” Ariz. Rev. Stat. §8-601. The Ninth Circuit concluded that the twins met this legitimacy test, compelling Social Security to pay benefits under applicable state law.

AR 06-1(2) “Fleeing Felons” and Probation or Parole Violators

Effective since January 1, 2005, Title II has the same prohibition of benefit payments to “fugitive felons” and probation/parole violators that has applied to SSI recipients since 1996. The Second Circuit has rejected SSA’s policy rule in the POMS that the existence of an outstanding warrant is sufficient alone to establish that a beneficiary is a “fugitive” subject to benefit suspension, even where the individual is unaware of the warrant or has no reason to suspect that any charges may have been filed that could lead to a warrant. Fowlkes v. Adamec, 432 F.3d 90 (2nd Cir. 2005). The Fowlkes decision has been published as Acquiescence Ruling 06-1(2). 71 FR 17551; 4/6/06.

Noting that the statute prohibits benefit payments if a person is “fleeing to avoid prosecution,” the court held that “fleeing” requires intent: a “conscious evasion of arrest or prosecution.” The contrary POMS rule was rejected as an incorrect interpretation of the Act.

For benefit applicants and recipients in the Second Circuit (CT, NY, VT), AR 06-1(2) prevents a benefit suspension unless SSA has “evidence that the individual knows that there is an outstanding felony arrest warrant, and the outstanding arrest warrant must have been issued on the basis that the individual has fled or is fleeing from justice.”

Providing reliable disability information since 1985