LAURA FASHING, Magistrate Judge.
THIS MATTER comes before the Court on plaintiff Manuel Victor Saavedra's Motion to Reverse and Remand for a Rehearing with Supporting Memorandum (Doc. 15), which was fully briefed on May 22, 2017. Docs. 18, 19, 20. The parties consented to my entering final judgment in this case. Docs. 4, 7, 8. Having meticulously reviewed the entire record and being fully advised in the premises, the Court finds that the Administrative Law Judge ("ALJ") failed to apply the correct legal standards in weighing the opinions of non-examining state agency medical consultant Dr. Scott Walker. The Court therefore GRANTS Mr. Saavedra's motion and remands this case to the Commissioner for proceedings consistent with this opinion.
The standard of review in a Social Security appeal is whether the Commissioner's final decision
"Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Langley, 373 F.3d at 1118. A decision "is not based on substantial evidence if it is overwhelmed by other evidence in the record or if there is a mere scintilla of evidence supporting it." Id. While the Court may not reweigh the evidence or try the issues de novo, its examination of the record as a whole must include "anything that may undercut or detract from the ALJ's findings in order to determine if the substantiality test has been met." Grogan v. Barnhart, 399 F.3d 1257, 1262 (10th Cir. 2005). "`The possibility of drawing two inconsistent conclusions from the evidence does not prevent [the] findings from being supported by substantial evidence.'" Lax v. Astrue, 489 F.3d 1080, 1084 (10th Cir. 2007) (quoting Zoltanski v. F.A.A., 372 F.3d 1195, 1200 (10th Cir. 2004)).
To qualify for disability benefits, a claimant must establish that he or she is unable "to engage in 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); 20 C.F.R. § 404.1505(a).
When considering a disability application, the Commissioner is required to use a five-step sequential evaluation process. 20 C.F.R. § 404.1520; Bowen v. Yuckert, 482 U.S. 137, 140 (1987). At the first four steps of the evaluation process, the claimant must show: (1) the claimant is not engaged in "substantial gainful activity;" (2) the claimant has a "severe medically determinable . . . impairment . . . or a combination of impairments" that has lasted or is expected to last for at least one year; and (3) the impairment(s) either meet or equal one of the Listings
Mr. Saavedra, currently age 57, was in special education throughout school, and dropped out in the twelfth grade. AR 45-46, 206.
The ALJ found that Mr. Saavedra was insured for disability benefits through December 31, 2014. AR 18. At step one, the ALJ found that Mr. Saavedra had not engaged in substantial, gainful activity since January 1, 2011, the alleged date of onset. Id. Because Mr. Saavedra had not engaged in substantial gainful activity for at least twelve months, the ALJ proceeded to step two. AR 18-19. At step two, the ALJ found that Mr. Saavedra had the following severe impairments: "liver problems (hepatosplenomegaly/cirrhosis/esophageal varices); Hepatitis C with fatigue; bilateral sensorial hearing loss; left shoulder problems/pain; obesity; lumbar arthritis; learning disorder NOS (reading/writing/mathematics); and depressive disorder NOS." AR 18. Also at step two, the ALJ found that Mr. Saavedra had several nonsevere impairments. AR 19. At step three, the ALJ found that none of Mr. Saavedra's impairments, alone or in combination, met or medically equaled a Listing. AR 19-21. Because the ALJ found that none of the impairments met a Listing, the ALJ assessed Mr. Saavedra's RFC. AR 21-28. The ALJ found that:
AR 21.
At step four, the ALJ concluded that Mr. Saavedra was unable to perform his past relevant work as a painter, plumber, mailer handler, stocker, or concrete worker. AR 29. The ALJ found Mr. Saavedra was not disabled at step five, concluding that he still could perform jobs that exist in significant numbers in the national economy—such as ticket taker, shipping and receiving weigher, and routing clerk. AR 30.
Mr. Saavedra requested review by the Appeals Council, which, on May 14, 2016, denied the request. AR 1-12. Mr. Saavedra timely filed his appeal to this Court on July 15, 2016.
Mr. Saavedra raises two arguments for reversing and remanding this case: (1) the ALJ failed to incorporate into his RFC all of the moderate limitations in the opinion of state agency medical consultant Dr. Scott Walker, and (2) the ALJ failed to give adequate or legitimate reasons for rejecting the opinion of examining physician Dr. John R. Vigil.
Because the Court remands based on the ALJ's failure to properly analyze the opinion of Dr. Walker, the Court does not address the other alleged error, which "may be affected by the ALJ's treatment of this case on remand." Watkins v. Barnhart, 350 F.3d 1297, 1299 (10th Cir. 2003).
Although an ALJ need not discuss every piece of evidence, the ALJ must discuss the weight assigned to each medical source opinion. Keyes-Zachary v. Astrue, 695 F.3d 1156, 1161 (10th Cir. 2012) (citing 20 C.F.R. §§ 404.1527(e)(2)(ii), 416.927(e)(2)(ii)). Specifically, when assessing a plaintiff's RFC, an ALJ must explain what weight is assigned to each opinion and why. SSR 96-5p, 1996 WL 374183, at *5 (July 2, 1996).
In 2007, the Tenth Circuit Court of Appeals decided two cases that control here. First, in Haga, the court held that an ALJ erred in failing to explain why he adopted some of a consultative examiner's ("CE") restrictions but rejected others. 482 F.3d at 1208. "[T]he ALJ did not state that any evidence conflicted with [the CE's] opinion or mental RFC assessment. So it is simply unexplained why the ALJ adopted some of [the CE's] restrictions but not others." Id. The court remanded the case "so that the ALJ [could] explain the evidentiary support for his RFC determination." Id. Later in 2007, in Frantz v. Astrue, 509 F.3d 1299, 1302-03 (10th Cir. 2007), the Tenth Circuit expressly applied Haga and its reasoning to the opinions of non-examining physicians.
Mr. Saavedra argues that the ALJ failed to account for all of the moderate limitations in Dr. Walker's Mental Residual Functional Capacity Assessment ("MRFCA"). Doc. 15 at 14-17. Specifically, he argues that the ALJ failed to account for the moderate limitations Dr. Walker found in his ability "to perform activities within a schedule, maintain regular attendance, and be punctual within customary tolerances" and in his ability "to complete a normal workday and workweek without interruptions from psychologically based symptoms and to perform at a consistent pace without an unreasonable number and length of rest periods." Id. at 15-16. The Commissioner argues that the ALJ's RFC assessment is consistent with Dr. Walker's Section III findings, and that the ALJ was not required to discuss each of the moderate limitations in Section I of Dr. Walker's opinion. Doc. 18 at 4-8. The Court finds the Commissioner's argument unpersuasive, and agrees with Mr. Saavedra that the ALJ was required to either include, or to explain his reasons for rejecting, the moderate limitations noted in Section I of Dr. Walker's opinion.
The Court rejects the Commissioner's argument that the ALJ is only required to address Dr. Walker's Section III findings. As the Honorable Stephan M. Vidmar thoroughly explained in his opinion rejecting similar arguments, the Program Operations Manual System ("POMS"),
Social Security regulations also require ALJs to "consider findings and other opinions of State agency medical and psychological consultants and other program physicians, psychologists, and other medical specialists as opinion evidence . . . ." 20 C.F.R. §§ 404.1527(e)(2)(i), 416.927(e)(2)(i) (both effective Aug. 24, 2012 through March 26, 2017). "Evidence" includes "findings . . . made by State agency medical and psychological consultants and other program physicians and psychologists . . ., and opinions expressed by medical experts or psychological experts that we consult based on their review of the evidence in your case record." 20 C.F.R. §§ 404.1512(b)(1)(viii), 416.912(b)(1)(viii) (both effective Apr. 20, 2015 through March 26, 2017). Like the POMS, the regulations do not exempt the Section I findings from an ALJ's consideration and evaluation. See id.
Case law also requires ALJs to consider the entire MRFCA, not just the Section III findings. The Court has surveyed the cases from the Tenth Circuit that expressly address the distinction between Section I and Section III findings. Two cases, Smith v. Colvin, 821 F.3d 1264 (10th Cir. 2016) and Sullivan v. Colvin, 519 F. App'x 985 (10th Cir. 2013) (unpublished), arguably could be interpreted in the Commissioner's favor, but the others could not. Compare Smith, 821 F.3d at 1269 n.2
Thus, under Haga, 482 F.3d at 1208, and Frantz, 509 F.3d at 1302-03, the ALJ has a duty to explain why he adopted some of Dr. Walker's limitations while rejecting others. The Court must determine whether the ALJ adequately accounted for the limitations noted by Dr. Walker in the RFC assessment. See Carver, 600 F. App'x at 619 ("if a consultant's Section III narrative fails to describe the effect that each of the Section I moderate limitations would have on the claimant's ability, or if it contradicts limitations marked in Section I, the MRFCA cannot properly be considered part of the substantial evidence supporting an ALJ's RFC finding"). If not, the Court must determine whether the ALJ adequately explained why he rejected the missing limitations.
In Section I of his May 1, 2013 MRFCA, Dr. Walker found that Mr. Saavedra had the following moderate limitations:
AR 122-23.
In Section III of his MRFCA, Dr. Walker found that:
AR 124.
The ALJ discussed Dr. Walker's opinion in a single paragraph of his RFC analysis:
AR 27.
As an initial matter, the Court notes that the ALJ did not state what weight he gave to Dr. Walker's opinion. However, the ALJ stated that he found Mr. Saavedra more limited than Dr. Walker did, and he did not specifically reject any of the moderate limitations in Dr. Walker's opinion. AR 27. Because he did not reject any of Dr. Walker's opinion, the ALJ was required to incorporate the moderate restrictions in Dr. Walker's opinion into Mr. Saavedra's RFC. Contrary to the Commissioner's arguments, it was not sufficient for the ALJ to account only for Dr. Walker's Section III findings in the RFC. Dr. Walker's Section III summary fails to account for all the moderate limitations he assessed in Section I. Specifically, in Section I, Dr. Walker found that Mr. Saavedra had a "moderate limitation" in his "ability to perform activities within a schedule, maintain regular attendance, and be punctual within customary tolerances." AR 122. Also in Section I, Dr. Walker found that Mr. Saavedra had a "moderate limitation" in his "ability to complete a normal workday and workweek without interruptions from psychologically based symptoms and to perform at a consistent pace without an unreasonable number and length of rest periods." AR 122-23. In Section III, however, without any narrative explanation, Dr. Walker found that Mr. Saavedra was capable of doing unskilled work,
The Commissioner claims that Dr. Walker "translated the `moderate' limitations he noted in section I of the form into an RFC assessment in section III." Doc. 18 at 6. The Commissioner, however, provides no explanation of how Dr. Walker encapsulated the Section I limitations in Section III. The Commissioner cites Vigil v. Colvin, 805 F.3d 1199, 1204 (10th Cir. 2015), for the proposition that the ALJ does not have to include all "moderate limitations in the RFC assessment." Doc. 18 at 4. Vigil, however, is distinguishable. In Vigil, the Tenth Circuit held that the ALJ adequately accounted for the claimant's moderate limitations in concentration, persistence and pace by "limiting him to unskilled work." 805 F.3d at 1204. The moderate limitations at issue in Vigil were limitations in the claimant's ability to "perform complex tasks." Id. at 1203-04. The ALJ in Vigil noted that the claimant retained the capacity to "perform at least simple tasks." Id. at 1204. Because unskilled work only requires the ability to understand, remember, and carry out
The Tenth Circuit has held only that moderate limitations in concentration, persistence and pace may be accounted for in an RFC that restricts a claimant to performing simple tasks or unskilled work. See Lee v. Colvin, No. 15-6027, 2015 WL 7003410, at *3 (10th Cir. 2015) (emphasis added). But this is not always the case. "A limitation to `simple work' or `unskilled jobs' is generally insufficient to address a claimant's mental impairments." Groberg v. Astrue, 505 F. App'x 763, 770 (10th Cir. 2012) (unpublished) (citing Chapo, 682 F.3d at 1290 n.3, which stated that a restriction to "simple work" is a vague catch-all term which is insufficient to adequately account for mental limitations). "[A] moderate impairment is not the same as no impairment at all." Haga, 482 F.3d at 1208. Thus, "moderate limitations must be accounted for in the RFC finding." Jaramillo v. Colvin, 576 F. App'x 870, 876 (10th Cir. 2014) (unpublished).
In the instant case, unlike Vigil, the claimant's moderate mental limitations are not adequately addressed by a RFC limiting him to unskilled work, or by any of the limitations the ALJ included in his RFC. Dr. Walker assessed Mr. Saavedra with moderate limitations in his ability to "maintain regular attendance, and be punctual within customary tolerances" and in his "ability to complete a normal workday and workweek without interruptions from psychologically based symptoms and to perform at a consistent pace without an unreasonable number and length of rest periods." These are mental abilities which are "critical for performing unskilled work." POMS DI 25020.010(d)(3)(e), (i). These tolerances and requirements "are usually strict." Id. Thus, unlike Vigil, which discussed a limitation in the ability to do complex tasks—a mental ability not required to perform unskilled work—the moderate limitations at issue in this case are critical to the performance of unskilled work. The ALJ therefore erred in not incorporating these limitations, or explaining his reasons for rejecting them.
The two limitations not addressed by Dr. Walker's Section III findings belong to the same "categor[y] of vocational significance"—Mr. Saavedra's reliability. See Chapo, 682 F.3d at 1289-90. The ALJ's colloquy with the vocational expert ("VE") highlighted the vocational significance of these limitations. The ALJ asked the VE if a claimant who "would routinely be off task 15 to 20 percent of the work period and would regularly miss two to three days of work per month" would be able to do the jobs the VE listed at step five. AR 79. The VE stated that "that amount of time off task or away from the work site" would preclude competitive employment. Id. Given that this hypothetical presented an individual with obvious difficulties completing a workday and workweek without interruptions from psychologically based symptoms, or one unable to maintain a consistent pace without an unreasonable number and length of rest periods, it is telling that the ALJ ultimately omitted these uncontroverted limitations from Mr. Saavedra's RFC.
The ALJ erred in failing to incorporate or to explain why he rejected at least two moderate limitations assessed by Dr. Scott Walker into Mr. Saavedra's RFC. The ALJ failed to either incorporate or explain why he rejected the moderate limitation in Mr. Saavedra's ability to perform activities within a schedule, maintain regular attendance, and be punctual within customary tolerances, and in his ability to complete a normal workday and workweek without interruptions from psychologically based symptoms and to perform at a consistent pace without an unreasonable number and length of rest periods. The Court remands so that the ALJ can remedy these errors.
20 C.F.R. §§ 404.1545(c), 416.945(c); see also SSR 96-8p, 1996 WL 374184, at *6 ("Work-related mental activities generally required by competitive, remunerative work include the abilities to: understand, carry out, and remember instructions; use judgment in making work-related decisions; respond appropriately to supervision, co-workers and work situations; and deal with changes in a routine work setting."). In formulating the RFC, an ALJ must perform a function-by-function assessment of these work-related functions, considering all of the relevant evidence in the case record. SSR 96-8p, 1996 WL 374184, at*2. The Tenth Circuit has held that where a claimant is found to have more than mild mental limitations in work-related functions, the ALJ must "express those impairments `in terms of work-related functions' or `[w]ork-related mental activities.'" Jaramillo v. Colvin, 576 F. App'x 870, 876 (10th Cir. 2004) (unpublished) (quoting SSR 96-8p, 1996 WL 374184, at *6).