ORDER REVERSING AND REMANDING CASE FOR FURTHER ADMINISTRATIVE PROCEEDINGS

RICHARD A. JONES, District Judge.

Heidi C. Woodsum seeks review of the denial of her application for Supplemental Security Income. Ms. Woodsum contends the ALJ erroneously (1) failed to consider her physical impairments at step two, and (2) evaluated the examining opinions of Terilee Wingate, Ph.D. and her own testimony. Dkt. 11 at 1. Ms. Woodsum contends these errors resulted in a residual functional capacity (RFC) determination that failed to account for all of her limitations. Id. As discussed below, the Court REVERSES the Commissioner's final decision and REMANDS the matter for further administrative proceedings under sentence four of 42 U.S.C. § 405(g).

BACKGROUND

In August 2012, Ms. Woodsum applied for benefits, alleging disability as of May 19, 2011. Tr. 12, 267-78. Ms. Woodsum's application was denied initially and on reconsideration. Tr. 145-58, 157-68. After the ALJ conducted a hearing on September 17, 2014, the ALJ issued a decision finding Ms. Woodsum not disabled. Tr. 12-22.

THE ALJ'S DECISION

Utilizing the five-step disability evaluation process,1 the ALJ found:

Tr. 12-22. The Appeals Council denied Ms. Woodsum's request for review making the ALJ's decision the Commissioner's final decision. Tr. 1-7.3

DISCUSSION

A. Step 2 Consideration of Physical Impairments

Ms. Woodsum argues the ALJ harmfully erred at step two in evaluating her physical impairments. The Court disagrees.

The Social Security Act (Act) defines "disability" as the "inability 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), 1382c(a)(3)(A). At step two of the sequential evaluation, the Commissioner must determine "whether the claimant has a medically severe impairment or combination of impairments." See Smolen v. Chater, 80 F.3d 1273, 1290 (9th Cir. 1996); 20 C.F.R. § 404.1520(a)(4)(ii). The claimant has the burden to show that (1) she has a medically determinable physical or mental impairment, and (2) the medically determinable impairment is severe. See Bowen v. Yuckert, 482 U.S. 137, 146 (1987). A "`physical or mental impairment' is an impairment that results from anatomical, physiological, or psychological abnormalities which are demonstrable by medically acceptable clinical and laboratory diagnostic techniques." 42 U.S.C. §§ 423(d)(3), 1382c(a)(3)(D). Thus, to establish the existence of a severe impairment, the claimant must provide medical evidence consisting of signs, symptoms, and laboratory findings. 20 C.F.R. § 404.1508. However, "`[r]egardless of how many symptoms an individual alleges, or how genuine the individual's complaints may appear to be, the existence of a medically determinable physical or mental impairment cannot be established in the absence of objective medical abnormalities; i.e., medical signs and laboratory findings[.]'" Ukolov v. Barnhart, 420 F.3d 1002, 1005 (9th Cir. 2005) (quoting SSR 96-4p).

In addition to producing evidence of a medically determinable physical or mental impairment, the claimant bears the burden at step two of establishing that the impairment or impairments is "severe." See Bowen, 482 U.S. at 146. An impairment or combination of impairments is severe if it significantly limits the claimant's physical or mental ability to do basic work activities. 20 C.F.R. §§ 404.1520(c), 404.1521(a). "The step two inquiry is a de minimus screening device to dispose of groundless claims." Id. An impairment or combination of impairments may be found "`not severe' only if the evidence establishes a slight abnormality that has `no more than a minimal effect on an individual's ability to work.'" Smolen, 80 F.3d at 1290 (citing Yuckert v. Bowen, 841 F.2d 303, 306 (9th Cir. 1988)). However, the claimant has the burden of proving his "impairments or their symptoms affect [his] ability to perform basic work activities." Edlund v. Massanari, 253 F.3d 1152, 1159-60 (9th Cir. 2001).

Ms. Woodsum argues that that the record shows she has a history of chronic shoulder pain and "imaging of her cervical and thoracic spine showed widespread degeneration."4 Dkt. 11 at 13. First, although there are mentions of "shoulder pain" in the record these findings do not appear to be based upon or supported by objective medical abnormalities; i.e., medical signs and laboratory findings.5 Ms. Woodsum's symptom complaints alone are insufficient to establish a medically determinable physical or mental impairment. See Ukolov, 420 F.3d at 1005; 20 C.F.R. § 416.929; SSR 96-4p. Second, even if this evidence were sufficient to establish a medically determinable impairment, a diagnosis, without more, is insufficient to establish a severe impairment. See, e.g., Bowen, 482 U.S. at 146; Febach v. Colvin, 580 F. App'x. 530, 531 (9th Cir. 2014) (a "diagnosis alone is insufficient for finding a `severe' impairment"). Ms. Woodsum fails to point to any evidence indicating that either her alleged shoulder or back impairments affected her ability to perform basic work activities.6 See Edlund, 253 F.3d at 1159-60. Ms. Woodsum did not cite back, neck or shoulder problems as limiting her ability to work in response to the ALJ's inquiry at the hearing. Tr. 34-36. Rather, Ms. Woodsum cited only mental health issues as impairments preventing her from working. Id. Moreover, Ms. Woodsum does not point to any clinical findings in the record indicating the presence of any significant work-related limitations stemming from her alleged physical impairments.

Ms. Woodsum also argues that the ALJ "should have pursued an investigation of the severity of [her] chronic shoulder pain." Dkt. 11 at 13. The ALJ's duty to develop the record is triggered "when there is ambiguous evidence or when the record is inadequate to allow for proper evaluation of the evidence." Mays v. Massanari, 276 F.3d 453, 460 (9th Cir. 2001). However, this principle cannot be used to shift the claimant's burden of proving disability to the ALJ. Id. at 460 (noting it is the claimant's "duty to prove she was disabled" and she cannot "shift her own burden" to the ALJ by virtue of the ALJ's duty to develop the record). Here, Ms. Woodsum fails to point to clinical evidence indicating that her alleged shoulder impairment affected her ability to perform basic work activities. Requiring the ALJ to further "investigate" in this circumstance would improperly shift the burden of establishing disability from Ms. Woodsum to the ALJ.

Accordingly, Ms. Woodsum fails to establish the ALJ harmfully erred at step two in evaluating her physical impairments.

B. Consideration of Polysubstance Abuse and the Drug Addiction and Alcoholism (DAA) Analysis

Ms. Woodsum contends the ALJ erred in evaluating Dr. Wingate's examining opinions as well as her own testimony. However, the Court does not discuss these contentions in detail because, as discussed below, the ALJ's decision suffers from a more fundamental legal error requiring remand for further proceedings: the failure to properly analyze Ms. Woodsum's substance abuse.

The Court may set aside the Commissioner's denial of disability benefits where the ALJ committed legal error. Tackett v. Apfel, 180 F.3d 1094, 1097 (9th Cir. 1999). Where there is significant evidence of alcohol and drug use in the record, as there is in this case, the ALJ must conduct a specific drug addiction and alcoholism (DAA) analysis to determine whether a claimant's disabling limitations remain absent the use of drugs or alcohol.

The regulations provide that if DAA is a contributing factor material to the determination of disability, a claimant cannot be considered disabled for purposes of awarding benefits. See 42 U.S.C. § 1382c(a)(3)(J); 20 C.F.R. §§ 404.1535 and 416.935. Thus, when DAA is present, the Ninth Circuit has established a specific procedure that must be applied to determine whether DAA is a contributing factor material to the determination of disability. See 20 C.F.R. §§ 404.1535 and 416.935; Bustamante v. Massanari, 262 F.3d 949, 955 (9th Cir. 2001). First, the ALJ must complete the five-step disability analysis described above without separating out the effects of DAA. See Bustamante, 262 F.3d at 956 (remanding "with instructions that the ALJ proceed with step three (and four and five, if necessary) of the disability determination without attempting to separate out the impact of . . . alcohol abuse."). If the ALJ finds the claimant is not disabled under the five step inquiry, then the claimant is not entitled to benefits and there is no need to proceed with the analysis regarding DAA under 20 C.F.R. §§ 404.1535 or 416.935. Id. On the other hand, if the ALJ finds the claimant disabled without separating out the impacts of DAA, the ALJ must then perform the sequential evaluation process a second time, separating out the impact of the DAA, to determine whether she would remain disabled if she stopped using drugs or alcohol. See id.; Bustamante, 262 F.3d at 956. If the ALJ finds the claimant's remaining limitations are disabling after completing that second evaluation, then DAA is not a contributing factor material to the determination of disability and the claimant is disabled. 20 C.F.R. §§ 404.1535(b)(2)(ii), 416.935(b)(2)(ii). On the other hand, if after the second evaluation the ALJ determines a claimant's remaining limitations would not be disabling, the ALJ must find that the claimant's DAA is a contributing factor material to the determination of disability and the claimant is not disabled. 20 C.F.R. §§ 404.1535(b)(2)(ii), 416.935(b)(2)(i).

Here, the ALJ found major depressive disorder and PTSD to be severe impairments at step two. The ALJ did not specifically include substance abuse as a severe impairment at step two. However, polysubstance abuse is diagnosed repeatedly by acceptable medical sources throughout the record. See, e.g., Tr. 400, 438, 444, 478, 487, 534, 537-38, 539-40, 640, 678, 748. Moreover, the ALJ's findings clearly indicate that substance abuse had a significant impact on Ms. Woodsum's mental impairments and that the ALJ attempted to improperly factor out the effects of substance abuse prematurely in finding Ms. Woodsum not disabled on his initial fivestep evaluation. This is evidenced by the ALJ's determination that "objective medical evidence shows that exacerbations in [Ms. Woodsum's] . . . alleged mental health symptoms are caused by her substance abuse[.]" Tr. 16. It is further evidenced by the fact that the ALJ discounted Dr. Wingate's examining opinion, which assessed various marked limitations in mental functioning, in part, on the grounds that it "completely fails to take into account the claimant's substance abuse and the impact it has on her mental impairments." Tr. 20, 370-73, 757-64.

These findings, and the ALJ's analysis as a whole, indicate that he considered substance abuse to be more than a slight abnormality and to have more than a deminimus effect on Ms. Woodsum's ability to function. As such, in the first instance, the ALJ should have evaluated the severity of Ms. Woodsum's polysubstance abuse at step two. Moreover, given that substance abuse plays a significant role in the ALJ's evaluation of the evidence, the ALJ was required to conduct a specific DAA analysis. 20 C.F.R §§ 404.1535, 416.935; 42 U.S.C. § 423(d)(2)(C). Here, the ALJ erred in failing to do so. The ALJ did not mention or discuss the application of a DAA analysis in his decision. As noted above, the ALJ was required to conduct the five-step inquiry without first determining the impact of substance abuse on Ms. Woodsum's other impairments. See Bustamante, 262 F.3d 949. Instead, as evidenced by the findings mentioned above, the ALJ improperly conducted the initial five-step inquiry prematurely separating out the impact of DAA on Ms. Woodsum's mental impairments.

In sum, although substance abuse was a major consideration in the ALJ's nondisability determination, the ALJ erred by failing to apply the regulations and Ninth Circuit case law requiring the ALJ to apply a specific two-step DAA analysis. This error is not harmless as it renders the ALJ's findings here unreliable. Remand is required because the Court cannot itself apply the five-step disability inquiry, including the two-step substance abuse analysis. Rather it is the role of the ALJ, not the Court, to properly evaluate Ms. Woodsum's disability claim. See, e.g., Securities and Exchange Commission v. Chenery Corp., 332 U.S. 194, 196 (1947) (emphasizing "a simple but fundamental rule of administrative law" that "a reviewing court, in dealing with a determination or judgment which an administrative agency alone is authorized to make, must judge the propriety of such action solely by the grounds invoked by the agency" and "[i]f those grounds are inadequate or improper, the court is powerless to affirm the administrative action by substituting what it considers to be a more adequate or proper basis."). Moreover, the Court need not address Ms. Woodsum's other claimed errors because they occur in the context of a disability determination that failed to follow the proper disability procedures and analysis. Because, in this case, Ms. Woodsum's claims of error with respect to Dr. Wingate's opinions and her own testimony are "inextricably intertwined" with her substance abuse, it is appropriate for the Court to remand for the ALJ to separate out the impact of substance abuse through a proper DAA analysis. Elmore v. Astrue, 2012 WL 3240285 (W.D. Wa., July 16, 2012) (holding the Court need not reach claimant's other assignments of errors because they are inextricably intertwined with the claimant's substance abuse and it was appropriate for the Court to leave it to the Commissioner to "untangle" the impact of substance abuse).7

The Court is aware that the parties did not specifically challenge the ALJ's failure to apply the two-step DAA analysis.8 Normally, the Court need not address errors that are not specifically and distinctly argued. However, the ALJ's failure to apply the proper DAA analysis is in the nature of a structural error and central to the validity of the disability determination process.9 Moreover, even if considered under a harmless error analysis, the ALJ's "muddled consideration" of Ms. Woodsum's substance abuse prevents a clear determination that the error was harmless. Woolery v. Colvin, 2013 WL 3294890 (W.D. Wash. June 28, 2013) (finding the ALJ erred in failing to conduct a proper DAA analysis and that "the ALJ's muddled consideration of plaintiff's alcohol abuse prevents a clear finding that the ALJ's error was harmless."); see Maloney v. Comm'r of Soc. Sec. Admin., 2014 WL 3871214 (D. Or. August 5, 2014) ("The court cannot say the instant error [in failing to follow the two-step DAA analysis] was harmless, because the ALJ considered the same type of substance-abuse-related evidence which, by law, she was precluded from considering in the initial sequential analysis."). As noted above, the ALJ's failure to apply the proper DAA analysis in this case renders his findings unreliable which, in turn, renders proper consideration of Ms. Woodsum's other claimed errors problematic. As such, the ALJ's failure to apply the proper DAA analysis in this case is an appropriate basis to remand this matter for further proceedings.

CONCLUSION

For the foregoing reasons, the Commissioner's final decision is REVERSED and this her failure to account for the impact of substance abuse on Ms. Woodsum's mental impairments. Dkt. 11 at 10-11. case is REMANDED for further administrative proceedings under sentence four of 42 U.S.C. § 405(g).

On remand, the ALJ should evaluate the severity of polysubstance abuse at step two and proceed with a proper five-step disability determination without attempting to separate out the impact of Ms. Woodsum's substance abuse. Only if the ALJ determines Ms. Woodsum is disabled under the five-step inquiry, should the ALJ go on to consider whether substance abuse is a contributing factor material to that determination. In applying the proper DAA analysis, the ALJ shall also reevaluate the medical evidence, Ms. Woodsum's testimony, and develop the record as needed.