Last Update: 9/08/05 (Transmittal I-3-36)
Initial claims for disability under the Social Security Act are evaluated following a sequence set forth in 20 CFR 404.1520 and 416.920. The purpose of this section is to provide a basic checklist of issues that arise in an initial disability case and to illustrate how these issues form the essential building blocks of the decision. As each issue is resolved, another arises, until eventually the ultimate issue is reached. A conclusion on the ultimate issue of disability at any step of the sequential evaluation will be defensible only if all of the subsidiary issues are resolved.
Very few cases which reach the hearing level contain clear and convincing evidence that the claimant is engaging in substantial gainful activity. To determine whether a claimant is engaging in substantial gainful activity, address and resolve such issues as:
the amount of earnings;
impairment-related work expenses; and
work performed in a sheltered environment.
At step two, determining whether a severe impairment exists requires an analysis of:
the diagnosis or diagnoses;
the limitations alleged;
the limitations established; and
whether the diagnosed impairment(s) significantly limits the claimant's ability to perform basic work activities.
If the evidence clearly establishes a severe impairment, a detailed rationale or analysis of the medical findings at this point is not necessary. However, a finding of “no severe impairment” represents a decision on the ultimate issue of disability. In that case, the objective medical evidence as well as any opinion evidence and subjective complaints must be analyzed and any conflicts in the evidence resolved. In doing so, the decision must clearly discuss:
the evidence (documentary or oral testimony) which supports the ultimate conclusion of “not severe;”
any conflicting evidence and its probative weight; and
any opinions, especially from a treating source about the severity or nature of any limitations, and their probative value.
At step three, decisions stating that a listing is or is not met or equalled must provide rationale regarding:
the listing(s) being considered; and
why the claimant's impairment(s) does or does not meet or equal the requirements of the listing.
If a medical expert testified at the hearing, this testimony must be cited.
The first critical issue at step 4 is the determination of residual functional capacity (RFC). Some consideration of limit(s) on function was implicit at step two in deciding severity, but the record must now undergo more rigorous analysis. The decision must refer to specific exhibits or testimony and discuss:
the established impairment(s);
the alleged impairments which cannot be established by the objective medical evidence;
the functional limitations of the impairment(s) and what medical findings support that determination;
conflicts in the record which must be resolved with specific reasons given for rejecting or giving little weight to opinions and diagnoses from treating sources;
any subjective testimony about limitations and the extent to which it is credible;
the physical and mental abilities of the claimant considering all factors, including limitations resulting from impairments which in themselves are not considered severe; and
any other nonexertional limitations.
The resulting RFC, expressed in terms of specific retained capacities, must then be compared to the specific requirements, both exertional and nonexertional, of the claimant's past relevant work.
Whether work performed in the past is relevant may be a major issue in itself. A decision must address:
the duration of the past work experience;
when the work was last performed; and
whether or not the job requirements and skills are relatively unchanged.
If the claimant is unable to perform past relevant work, other vocational issues become paramount. Some, such as age and education, may be easily resolved. However, in determining the level of skills the claimant may have or whether they are transferable, expert testimony may have been necessary. Expert testimony may also have been needed to elicit evidence on the availability of jobs. At this point the decision should have resolved all of the medical issues so that the remaining step involves a comparison of the RFC and vocational profile with the rules in Appendix 2 to Subpart P, Regulations No. 4. A decision on the ultimate issue at step five must cite the evidence and carefully discuss:
what skills, if any, the claimant acquired from past work experience;
whether or not any skills are transferable to other work;
the range of work at any exertional level which is suitable for the claimant; and
whether a significant number of jobs are available within the suitable range of work.
When a Title II and/or Title XVI disability issue case is decided at the fifth, and final step of the sequential evaluation process, include the following statement, or an equivalent statement, explicitly acknowledging that the burden of showing that the claimant can perform other work shifts to the Commissioner:
Once a claimant has established that he or she has no past relevant work or cannot perform his or her past relevant work because of his or her impairments, the burden shifts to the Commissioner to show that there are other jobs existing in significant numbers in the national economy which the claimant can perform, consistent with his or her medically determinable impairments, functional limitations, age, education and work experience.
This list of issues is not exhaustive; rather it provides a basic checklist of issues to be addressed. Also, the list illustrates the basic point of decision writing—that each decision on the ultimate issue requires the resolution of subsidiary issues if it is to be supported and withstand judicial scrutiny. Analysts must consult and cite any statute, regulation, Social Security Ruling, Acquiescence Ruling or circuit court law which provides more comprehensive coverage of issues and how they are to be resolved.
The analyst must ensure that those issues which have been significant to the appropriate circuit court on appeal are properly handled (see I-3-3-7). If the case involves one of these issues, the decisional rationale must demonstrate that the Appeals Council has properly considered the issue according to circuit law.
In all disability decisions involving DAA in which the claimant is found disabled, the Appeals Council must provide complete supporting rationale as to whether DAA is a contributing factor material to the finding of disability (see HALLEX I-3-8-3).
Cases other than initial disability claims, such as continuing disability review or retirement and survivors claims, present a different set of subsidiary and ultimate issues. However, the basic principles of decision writing are equally applicable. The issues are identified and form the outline of the decision. The evidence and applicable law and regulations are then used to resolve each issue until an ultimate conclusion is reached.