BYERLY v. ASTRUE
Filing
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ENTRY REMANDING the decision of the Commissioner. Signed by Judge Richard L. Young on 9/28/2012.(TMD)
UNITED STATES DISTRICT COURT
SOUTHERN DISTRICT OF INDIANA
EVANSVILLE DIVISION
JENNIFER WAYNE BYERLY
(Social Security No. XXX-XX-6887),
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Plaintiff,
vs.
MICHAEL J. ASTRUE, Commissioner
of the Social Security Administration,
Defendant.
3:11-cv-96-RLY-WGH
ENTRY ON JUDICIAL REVIEW
I. Background
Jennifer Wayne Byerly (“Byerly”), seeks judicial review of the final decision of
the Commissioner of Social Security (“Commissioner”), which found that she was
overpaid disability insurance benefits (“DIB”) from July 2005 to October 2007, that she
was “not without fault” in causing or accepting the overpayments, and that the Social
Security Administration was, therefore, entitled to a repayment of certain benefits that
Plaintiff had received.
In a decision dated July 6, 2005, an Administrative Law Judge (“ALJ”) determined
that Byerly was disabled because she did not retain the residual functional capacity
(“RFC”) to perform her past work or any other work in the regional economy. (R. 22-25).
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She was found to be disabled due to medical impairments. (R. 22).
On July 10, 2008, Byerly was informed that a determination had been made that her
benefits were to cease retroactive to July 2005 because she had engaged in substantial
gainful activity. (R. 32-35). It was confirmed on August 17, 2008, that Byerly was not
entitled to benefits from July 2005 to October 2007, and that she had received an
overpayment of $15,833.00 for this time period. (R. 56-57). After Byerly requested a
waiver from repayment of the overpayment, the Social Security Administration
determined that she was not entitled to a waiver. (R. 76-77). Byerly then appeared, pro
se, accompanied by an advocate, and testified before an ALJ at a hearing held August 18,
2009. (R. 1067-1106). On December 21, 2009, the ALJ issued her opinion finding that
Byerly was required to repay the overpayment. (R. 15-18). The Appeals Council denied
Byerly’s request for review, leaving the ALJ=s decision as the final decision of the
Commissioner. (R. 6-9). 20 C.F.R. '' 404.955(a), 404.981. Byerly then filed a
Complaint on August 10, 2011, seeking judicial review of the ALJ=s decision.
II. Legal Standards
An ALJ=s findings are conclusive if they are supported by substantial evidence. 42
U.S.C. § 405(g). Substantial evidence is defined as “such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion.” Richardson v.
Perales, 402 U.S. 389, 401 (1971) (citation omitted); see also Perkins v. Chater, 107 F.3d
1290, 1296 (7th Cir. 1997). This standard of review recognizes that it is the
Commissioner’s duty to weigh the evidence, resolve material conflicts, make independent
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findings of fact, and decide questions of credibility. Richardson, 402 U.S. at 399-400.
Accordingly, this court may not re-evaluate the facts, weigh the evidence anew, or
substitute its judgment for that of the Commissioner. See Butera v. Apfel, 173 F.3d 1049,
1055 (7th Cir. 1999).
III. The ALJ=s Decision
The ALJ=s December 21, 2009, decision included the following findings: (1)
Byerly was not entitled to disability benefits from July 2005 to October 2007 due to
substantial gainful activity (R. 18); (2) Byerly was overpaid disability benefits in the
amount of $15,833.00 during this time period (R. 18); (3) Byerly was not without fault in
causing or accepting overpayments (R. 18); and (4) recovery of the overpayment is not
waived (R. 18).
IV. Issues
Plaintiff=s brief essentially raises two issues:
1. Whether the ALJ erred in determining that Plaintiff was not without fault.
In this case, the ALJ determined that Byerly was Anot without fault@ in causing or
accepting overpayments of her disability benefits. Absent consideration for certain trial
work periods, the Social Security Act explains that no DIB shall be payable to any
individual for any month after the third month in which she engages in substantial gainful
activity. 42 U.S.C. ' 423(e)(1). When an individual has been overpaid DIB, the Social
Security Act provides for recovery of such overpayments by “requir[ing] such overpaid
person . . . to refund the amount in excess of the correct payment . . . .” Id. ' 404(a)(1)(A).
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However, the Social Security Act explains:
In any case in which more than the correct amount of payment has been
made, there shall be no adjustment of payments to, or recovery by the United
States from, any person who is without fault if such adjustment or recovery
would defeat the purpose of this title or would be against equity and good
conscience. In making for purposes of this subsection any determination of
whether any individual is without fault, the Commissioner of Social Security
shall specifically take into account any physical, mental, educational, or
linguistic limitation such individual may have (including any lack of facility
with the English language).
Id. ' 404(b). The Social Security regulations have further outlined how to determine
whether an individual is or is not without fault by explaining that fault:
depends upon whether the facts show that the incorrect payment to the
individual . . . resulted from:
(a) an incorrect statement made by the individual which he knew or should
have known to be incorrect; or
(b) failure to furnish information which he knew or should have known to be
material; or
(c) with respect to the overpaid individual only, acceptance of a payment
which he either knew or could have been expected to know was incorrect.
20 C.F.R. ' 404.507. Individuals who believe that they should not have to refund the
alleged overpayment are entitled to request a waiver from repayment. Id. ' 404.506.
In this case, Byerly does not take issue with the finding that an overpayment was
made. Instead, she argues that the ALJ erred by finding that she was “not without fault.”
Specifically, Byerly argues that she believed she had sustained significant
impairment-related work expenses that should have been counted to offset her earnings.
She argues that consideration of her impairment-related work expenses could have affected
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whether or not she was found to have engaged in substantial gainful activity during the
relevant time period. The Commissioner has provided the following rule for
consideration of impairment-related work expenses:
When we figure your earnings in deciding if you have done substantial
gainful activity, we will subtract the reasonable costs to you of certain items
and services which, because of your impairment(s), you need and use to
enable you to work. The costs are deductible even though you also need or
use the items and services to carry out daily living functions unrelated to
your work.
20 C.F.R. ' 404.1576(a). Such expenses include payments for attendant care services,
medical devices, equipment, drugs and medical services, transportation costs, and other
medical costs if they are directly related to an impairment and are needed to aid the
individual in working. Id. ' 404.1576(c).
The evidence reveals that Byerly earned $20,012.55 for 2005, $24,399.03 for 2006,
and $21,988.14 for 2007. (R. 16). According to the Commissioner, an individual
engages in substantial gainful activity if her average monthly income is as follows: (a)
2005B $830 ($9,960 a year); (b) 2006B$860 ($10,320); and (c) 2007B$900 ($10,800). (R.
34). This means that Byerly essentially made $10,052.55 too much money in 2005,
$14,079.03 too much in 2006, and $11,188.14 too much in 2007. However, the evidence
also reveals that Byerly had significant medical expenses during this time, including
expenses for significant dental reconstructive surgery related to a car accident, treatment
for cervical cancer, and substantial prescription drug costs. (R. 980-1024). The ALJ
determined that all evidence of payments for these medical expenses was Airrelevant@
because it was not related to Byerly’s mental impairments and, therefore, could not be
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counted as impairment-related work expenses. (R. 17). The ALJ determined that
Byerly’s potential impairment-related work expenses were only those expenses associated
with the actual mental impairments that the ALJ had determined were disabling, and not
any medical expenses associated with her alleged physical impairments. According to the
ALJ, Byerly could not demonstrate enough impairment-related work expenses in 2005,
2006, or 2007 to drop her earnings below the substantial gainful activity level. Therefore,
the ALJ determined that Byerly accepted disability benefits that she “knew or could have
been expected to know [were] incorrect,” (20 CFR 404.507) and was, therefore, not
without fault in accepting an overpayment.
In making this determination, the ALJ did not discuss in detail or even address 42
U.S.C. ' 404(b) which explains that an ALJ Ashall specifically take into account any
physical, mental, educational, or linguistic limitation such individual may have@ in
determining whether Byerly was or was not without fault. In this instance, the ALJ=s
failure to follow Section 404(b) is especially problematic and requires remand. This is the
case because in the July 2005 decision finding Byerly disabled, she was found to have been
disabled because of severe mental impairments, including: (1) major affective disorder,
rule out bipolar disorder; and (2) cognitive disorder and/or learning disabilities. (R. 24).
Furthermore, a letter directed to the ALJ from Indiana Protection and Advocacy
Services indicates that Byerly was confused about what her actual impairments were (as
defined by the Social Security Administration) and what did and did not count as
impairment-related work expenses. (R. 770-773). The letter explained:
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Ms. Byerly has a diagnosis of Pervasive developmental disability and she has
also sustained multiple traumatic brain injuries throughout her life. In
November 2007, Ms. Byerly was referred for psychological testing by
Indiana Vocational Rehabilitation Services. (See attached). Dr. Dorothy
Stephens identified a Right Hemispheric Dysfunction/Nonverbal Learning
Disability, Anxiety Disorder, ADHD, Mathematics Disorder, and
Occupational problems. Dr. Stephens reports that >a person with a right
hemispheric dysfunction has difficulty with math skills, motor and motor
planning ability, organizational difficulty, attention deficits, social
adjustment problems and anxiety[=] (Page 31) and that Ms. Byerly needs
assistance to manage her personal business matters. The next page of her
report states that even though Jennifer has excellent verbal skills she fails to
appropriately process verbal input causing misunderstandings. She also
falls in the lower limits of average range in overall memory.
(R. 772). Finally, at Byerly’s hearing before the ALJ, red flags were also raised about her
comprehension of her impairment-related work expenses. Byerly testified that she was
being accompanied by a Acognitive translator@ because she Aoftentimes [has] trouble
understanding what someone=s asking [her].@ (R. 1070). Later in the hearing, the ALJ
repeatedly had to explain to Byerly that (according to the ALJ) certain medical expenses
that she was trying to use did not qualify as impairment-related work expenses. (See, e.g.,
R. 1073-74).
Given the undisputed evidence which demonstrates that Byerly suffered from a
cognitive impairment, and given that the ALJ was put on notice that she was having
difficulty understanding the issue of impairment-related work expenses, the ALJ was
obligated to assess whether Byerly had a significant mental limitation which would impact
the ALJ=s finding concerning her level of “fault” in accepting an overpayment.1 On
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This is important because SSR 84-26 explains that
[an] impaired individual who . . . is working and has an IRWE may be eligible for IRWE
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remand, the ALJ must determine if Byerly had the sufficient mental ability to meet the
standard of being “not without fault.” The ALJ must determine that, given Byerly’s
mental limitations, she accepted an overpayment which she either knew or could have been
expected to know was incorrect.
2. Whether recovery of the overpayment would be against the purposes of the
Social Security Act as well as equity and good conscience.
On remand, if the ALJ determines that Plaintiff is “without fault” in accepting an
overpayment because of a significant mental impairment, then the ALJ must also
determine whether requiring repayment would defeat the purpose of the Social Security
Act or would be against equity and good conscience in accordance with 42 U.S.C. '
404(b).
deductions if he or she meets the SSA definition of disability; and because of a physical or
mental impairment(s), requires assistance (services, medical devices, etc.) in order to work
....
It is not clear not clear from this portion of SSR 84-26 whether the impairment actually has to be an
impairment that has already been found to be disabling or whether some other impairment for
which medical expenses are needed in order to enable an individual to work could also qualify the
individual for impairment-related work expenses. If Byerly believed that she was not being
overpaid because she had significant medical expenses and she wrongly believed that the medical
expenses she was paying qualified as impairment-related work expenses, then she very well may
have been without fault in accepting an overpayment (especially given her cognitive limitations).
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V.
Conclusion
The ALJ failed to follow 42 U.S.C. ' 404(b) when she decided that Byerly was Anot
without fault@ in accepting an overpayment of disability benefits. The ALJ did not
“specifically take into account any physical, mental, educational, or linguistic limitation
such individual may have” in determining Byerly was not without fault in accepting an
overpayment. The decision of the Commissioner is, therefore, REMANDED. On
remand, the ALJ must address Byerly’s severe mental impairments. If Byerly’s mental
impairments rendered her “without fault” (42 U.S.C. § 404(b)) in accepting an
overpayment, then the ALJ must determine whether requiring her to repay the
overpayment would defeat the purpose of the Social Security Act or would be against
equity and good conscience.
SO ORDERED the 28th day of September 2012.
__________________________________
RICHARD L. YOUNG, CHIEF JUDGE
RICHARD L. YOUNG, CHIEF JUDGE
United States District Court
United States District Court
Southern District of Indiana
Southern District of Indiana
Distributed Electronically to Registered Counsel of Record
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