Farden v. Social Security Administration
MEMORANDUM OPINION AND ORDER by Magistrate Judge Laura Fashing granting 23 Motion to Remand to Agency. (cda)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF NEW MEXICO
DIANE MARIE FARDEN,
NANCY A. BERRYHILL,1
Acting Commissioner of the
Social Security Administration,
MEMORANDUM OPINION AND ORDER
THIS MATTER comes before the Court on plaintiff Diane Marie Farden’s Motion to
Reverse or Remand Administrative Agency Decision, filed May 16, 2016, and fully briefed on
August 28, 2016. Docs. 23, 26, 27. The parties have consented to my entering a final judgment
in this case. Docs. 12, 29, 30. Having meticulously reviewed the entire record and being fully
advised in the premises, I find that the Administrative Law Judge (“ALJ”) failed to apply the
correct legal standards when assessing Ms. Farden’s credibility. I therefore GRANT Ms.
Farden’s motion and remand this case to the Commissioner for proceedings consistent with this
Standard of Review
The standard of review in a Social Security appeal is whether the Commissioner’s final
decision2 is supported by substantial evidence and whether the correct legal standards were
Nancy A. Berryhill, the new Acting Commissioner of Social Security, is automatically
substituted for her predecessor, Acting Commissioner Carolyn W. Colvin, as the defendant in
this suit. FED. R. CIV. P. 25(d).
The Court’s review is limited to the Commissioner’s final decision, 42 U.S.C. § 405(g), which
generally is the ALJ’s decision, 20 C.F.R. §§ 404.981, as it is in this case.
applied. Maes v. Astrue, 522 F.3d 1093, 1096 (10th Cir. 2008). If substantial evidence supports
the Commissioner’s findings and the correct legal standards were applied, the Commissioner’s
decision stands, and the plaintiff is not entitled to relief. Langley v. Barnhart, 373 F.3d 1116,
1118 (10th Cir. 2004). “The failure to apply the correct legal standard or to provide this court
with a sufficient basis to determine that appropriate legal principles have been followed is
grounds for reversal.” Jensen v. Barnhart, 436 F.3d 1163, 1165 (10th Cir. 2005) (internal
quotation marks and brackets omitted). The Court must meticulously review the entire record,
but may neither reweigh the evidence nor substitute its judgment for that of the Commissioner.
Flaherty v. Astrue, 515 F.3d 1067, 1070 (10th Cir. 2007).
“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)).
Applicable Law and Sequential Evaluation Process
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 fivestep 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 Listings3 of
presumptively disabling impairments; or (4) the claimant is unable to perform his or her “past
relevant work.” 20 C.F.R. § 404.1520(a)(4)(i–iv); Grogan, 399 F.3d at 1261. If the claimant
cannot show that his or her impairment meets or equals a Listing but proves that he or she is
unable to perform his or her “past relevant work,” the burden then shifts to the Commissioner, at
step five, to show that the claimant is able to perform other work in the national economy,
considering the claimant’s residual functional capacity (“RFC”), age, education, and work
Background and Procedural History
Ms. Farden was born on July 21, 1978. AR4 32, 223. She has a seventh grade education
and a history of working as a baby sitter, adult caregiver, cashier, waitress, and as the owner of a
landscape business. AR 32, 241, 261, 880, 902–03. At the time of the hearing before ALJ
Hertzig (the ALJ whose decision is at issue in this case), Ms. Farden was married and living with
her husband and youngest daughter in Clovis, New Mexico. AR 879–80.
20 C.F.R. pt. 404, subpt. P, app. 1.
Documents 20-1 through 20-64 comprise the sealed administrative record (“AR”). When citing
to the record, the Court cites to the AR’s internal pagination rather than the CM/ECF document
number and page.
Ms. Farden initially applied for Supplemental Security Income benefits on March 17,
2008, alleging disability since March 13, 2007. AR 223–29. Ms. Farden alleged she was
disabled due to arthritis in her spine, headaches, depression, insomnia, bulging discs in her back,
pain in both her legs, shooting pain from the bottom of her spine to the top of her head,
degenerative disc disease, and a ventral hernia. AR 240.
At the time of her March 2008 application, Ms. Farden lived in Dallas, Texas. AR 224.
While her application was pending, Ms. Farden moved to Clovis, New Mexico, and from Clovis,
she moved to California. AR 77–79. In June of 2014, Ms. Farden moved back to Clovis, New
Mexico. AR 1174.
Ms. Farden’s March 2008 application for benefits was denied initially and upon
reconsideration, and Ms. Farden requested a hearing before an ALJ. AR 98–99, 109–11. On
February 17, 2010, ALJ Lowell Fortune conducted a hearing, but because he did not have all of
the relevant medical evidence, he continued the hearing. AR 53–88. ALJ Fortune held a
supplemental hearing on June 4, 2010. AR 29–52. ALJ Fortune issued his unfavorable decision
on July 21, 2010. AR 9–28. The Appeals Council denied Ms. Farden’s request for review, and
on March 29, 2012, Ms. Farden appealed the Commissioner’s decision to the United States
District Court for the Central District of California. AR 1007–11, 1013–15. The district court in
California reversed and remanded the Commissioner’s decision for further proceedings on
March 25, 2013. AR 1020–43.
While ALJ Fortune’s decision was under review in California, Ms. Farden filed a second
application for supplemental security income on October 7, 2011, continuing to allege disability
as of March 13, 2007. AR 921. Her second application was denied initially and upon
reconsideration, and ALJ Jennifer Simmons held a hearing on May 21, 2012. Id. ALJ Simmons
issued an unfavorable decision on July 17, 2012. AR 918–932, 1081–92. The Appeals Council
consolidated Ms. Farden’s appeal of ALJ Simmons’ decision with ALJ Fortune’s remanded
decision and issued an order remanding the consolidated case to an administrative law judge.
AR 913–17, 1048–52.
ALJ Michael Hertzig held a hearing on March 20, 2015. AR 872–912. ALJ Hertzig
issued his unfavorable decision on May 15, 2015. AR 833–69. ALJ Hertzig’s decision is the
one at issue in this appeal. See Doc. 2. At step one, ALJ Hertzig found that Ms. Farden had not
engaged in substantial, gainful activity since her alleged onset date of March 17, 2008. AR 839.
Because Ms. Farden had not engaged in substantial gainful activity for at least 12 months, ALJ
Hertzig proceeded to step two. At step two, ALJ Hertzig found that Ms. Farden suffered from
the severe impairments of “morbid obesity, lumbar spine arthritis, and mixed connective tissue
disease.”5 Id. ALJ Hertzig found that Ms. Farden had several nonsevere impairments: knee
pain, restless leg syndrome, Sjögren’s syndrome, systemic lupus erythematosus, rheumatoid
arthritis, chronic obstructive pulmonary disease, hiatal hernia, gastric reflux, depression, anxiety,
pelvic pain, hypothyroid disease, hiatal hernia, gastroesophageal reflux disease, diverticulosis,
and chronic obstructive pulmonary disease and/or asthma. AR 840–50. At step three, ALJ
Hertzig found that none of Ms. Farden’s impairments—alone or in combination—met or
medically equaled a Listing. AR 850–52.
Notably, unlike the previous two ALJ’s, ALJ Hertzig did not find that Ms. Farden’s depressive
disorder was a severe impairment. Compare AR 839 with AR 14 (ALJ Fortune found depressive
disorder was a severe impairment) and AR 923 (ALJ Simmons found depressive disorder was a
severe impairment). ALJ Hertzig is, however, not bound by a prior ALJ’s ruling. See Miller v.
Barnhart, 175 F. App’x 952, 955 (10th Cir. 2006) (unpublished).
Because none of the impairments met a Listing, ALJ Hertzig moved to step four. At step
four, ALJ Hertzig found that:
[C]laimant has the residual functional capacity to perform sedentary work
as defined in 20 CFR 416.967(a) except can stand 30 minutes at one time, and
then must alternate position in place for a few minutes; can sit 60 minutes at one
time, and then can change position for a few minutes in place; never climbing
ladders, ropes, or scaffolds; occasional climbing ramps and stairs; occasional
balancing, stooping, kneeling, crouching, or crawling; avoid all exposure to
unprotected heights; can frequently be exposed to temperature extremes; can
occasionally be exposed to vibration and uneven surfaces.
AR 852. ALJ Hertzig determined that Ms. Farden was capable of performing her past relevant
work as an accounts receivable/payable clerk and payroll clerk and, therefore, was not disabled.
Ms. Farden requested—and the Appeals Council granted—an extension of time for filing
exceptions to ALJ Hertzig’s decision until August 13, 2015. AR 827-28, 832. Ms. Farden did
not file exceptions, and the Appeals Council did not review the decision on its own, making ALJ
Hertzig’s decision the final decision of the Commissioner and prompting this appeal. Doc. 2 at
1. Ms. Farden timely appealed the case to this Court on August 18, 2015. Doc. 2.
Both Ms. Farden and the Commissioner argue that ALJ Hertzig alternatively found that Ms.
Farden was capable of performing other jobs in the national economy. Doc. 23 at 6; Doc. 26 at
11. It is unclear, however, whether ALJ Hertzig intended to rely on the vocational expert’s
(“VE”) testimony to make an alternate finding. At step five, it is the Commissioner’s burden to
establish that the claimant can perform work that exists in significant numbers in the national
economy. See Dikeman v. Halter, 245 F.3d 1182, 1183 (10th Cir. 2001).
In his decision, ALJ Hertzig notes that the VE identified other jobs that Ms. Farden could
perform, but he does not mention the number of jobs that exist in the national economy and does
not find that the number is significant. AR 862. ALJ Hertzig’s acknowledgment of the VE’s
testimony about other jobs does not constitute a sufficient alternative finding. I will not assume
that just because the VE provided a number for the jobs in her testimony that ALJ Hertzig
adopted that testimony as a finding at step five. Regardless, ALJ Hertzig’s finding at step five is
not crucial to the disposition of this case.
Ms. Farden’s Claims
Ms. Farden raises six main arguments on appeal. She contends ALJ Hertzig erred in: (1)
finding Ms. Farden’s depressive disorder nonsevere at step two; (2) failing to follow the
mandates of the U.S. District Court and the Appeals Council; (3) finding that Ms. Farden’s
impairments did not meet Listing 14.06; (4) finding that Ms. Farden could perform her past
relevant work; (5) failing to accurately give his RFC to the vocational expert (“VE”); and (6)
improperly relying on the VE’s testimony that Ms. Farden was capable of performing other
Within Ms. Farden’s first point of error, she makes three sub-arguments. First, Ms.
Farden contends that ALJ Hertzig erred in finding her depressive disorder nonsevere by using
vague and imprecise terms to describe her medical treatment. Doc. 23 at 12–13. Next, she
criticizes ALJ Hertzig for failing to follow Social Security Ruling (“SSR”) 96-7p.7 Id. at 13–14.
Finally, Ms. Farden complains that ALJ Hertzig exaggerated or misstated evidence in order to
determine that her depressive disorder was nonsevere. Id. at 14–15. I find that while any error at
step two was harmless, ALJ Hertzig failed to conduct a complete credibility analysis in
accordance with SSR 96-7p at step four, requiring reversal. Because I remand based on ALJ
Hertzig’s failure to adequately analyze Ms. Farden’s credibility, I do not address the other
alleged errors, 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).
SSR 96-7p was superseded by SSR 16-3p on March 16, 2016. See SSR 16-3p, 2016 WL
1119029 (2016). The Court will apply SSR 96-7p in this case, however, because ALJ Hertzig’s
decision was made while SSR 96-7 was still in effect, and because both SSR 96-7p and SSR 163p require that an ALJ consider the reasons why a claimant may not seek treatment—including
the inability to afford treatment—which is at issue in this case.
A. Step Two
Ms. Farden first asks the Court to reverse the Commissioner’s final decision because ALJ
Hertzig failed to find at step two that her depressive disorder is a severe impairment. Doc. 23 at
12–15. At step two of the sequential evaluation process, the ALJ must determine whether any of
a claimant’s medically determinable impairments, or a combination thereof, is “severe.” See 20
C.F.R. § 416.920(c). To be “medically determinable,” an impairment
must result from anatomical, physiological, or psychological abnormalities which
can be shown by medically acceptable clinical and laboratory diagnostic
techniques. A physical or mental impairment must be established by medical
evidence consisting of signs, symptoms, and laboratory findings, not only by your
statement of symptoms.
20 C.F.R. § 416.908. To be “severe,” an impairment must significantly limit a claimant’s
“physical or mental ability to do basic work activities.” 20 C.F.R. § 416.920(c).
Step two is designed to weed out at an early stage of the administrative process those
individuals who cannot possibly meet the statutory definition of disability. Bowen, 482 U.S. at
156 (O’Connor, J. concurring). A claimant must make only a de minimis showing for his or her
claim to advance beyond step two of the sequential evaluation process. Langley, 373 F.3d at
1123. To that end, a claimant is required to establish—and an ALJ is required to find—only one
severe impairment. See Oldham v. Astrue, 509 F.3d 1254, 1256 (10th Cir. 2007) (rejecting the
argument that the ALJ erred in failing to find an impairment severe at step two where the ALJ
found other impairments were severe). “As long as the ALJ finds one severe impairment, the
ALJ may not deny benefits at step two but must proceed to the next step.” Dray v. Astrue, 353 F.
App’x 147, 149 (10th Cir. 2009) (unpublished). Step two errors are harmless “so long as the
ALJ reached the proper conclusion that [the claimant] could not be denied benefits conclusively
at step two and proceeded to the next step of the evaluation sequence.” Carpenter v. Astrue, 537
F.3d 1264, 1266 (10th Cir. 2008). Harmless errors do not warrant remand. Shineski v. Sanders,
556 U.S. 396, 407–09 (2009).
ALJ Hertzig determined at step two that Ms. Farden’s depressive disorder was medically
determinable, but nonsevere. AR 848. He further found that Ms. Farden suffered the severe
impairments of morbid obesity, lumbar spine arthritis, and mixed connective tissue disease. AR
839. ALJ Hertzig’s determination that Ms. Farden’s depressive disorder was not a severe
impairment at step two is, therefore, harmless and does not require remand because he found at
least one other impairment was severe and continued to the next steps in the sequential
ALJ Hertzig also conducted a proper evaluation in determining that Ms. Farden’s
depressive disorder was nonsevere. In determining the severity of a claimant's mental
impairment at step two, the ALJ must consider the claimant’s limitations in four broad functional
areas: (1) activities of daily living, (2) social functioning, (3) concentration, persistence, and
pace, and (4) episodes of decompensation (“the paragraph B factors”). See Wells v. Colvin, 727
F.3d 1061, 1068 (citing 20 C.F.R. §§ 404.1520a(c)(3), 416.920a(c)(3)8). ALJ Hertzig
thoroughly discussed each of the paragraph B factors in his opinion. AR 849–50. Accordingly,
he did not commit reversible error at step two.
This is not to say, however, that the disability evaluation process ends at step two with
regard to an impairment found to be nonsevere. An ALJ must consider the limiting effects of all
of a claimant’s impairments—including those that are not severe—in determining a claimant’s
RFC at step four. Dray, 353 F. App’x at 149 (citing 20 C.F.R. §§ 404.1545(e), 416.945(e); SSR
96-8p, 1996 WL 374184, at *5). “‘[P]aragraph B’ limitations are not an RFC assessment but are
20 C.F.R. §§ 404.1520a and 416.920a were revised on March 27, 2017, and no longer recite
this particular language.
used to evaluate the severity of mental impairments at steps 2 and 3 of the sequential evaluation
process.” Fulton v. Colvin, 631 F. App’x 498, 505 (10th Cir. 2015) (unpublished). In her step
two argument, Ms. Farden complains that ALJ Hertzig failed to follow SSR 96-7p. Doc. 23 at
13–14. Because ALJ Hertzig did not err at step two, Ms. Farden’s argument is more
appropriately an attack on ALJ Hertzig’s credibility findings at step four, and the Court will
evaluate it in that light.
B. Step Four
“A conclusion that the claimant’s mental impairments are non-severe at step two does not
permit the ALJ to simply disregard those impairments when assessing a claimant’s RFC and
making conclusions at steps four and five.” Wells, 727 F.3d at 1068–69. An ALJ’s RFC
assessment must consider both severe and nonsevere medically determinable impairments. Id.;
20 C.F.R. § 416.945(e). While the ALJ is not required to discuss every piece of evidence, an
ALJ must discuss the uncontroverted evidence he or she chooses not to rely upon and any
significantly probative evidence the ALJ decides to reject. See Wall v. Astrue, 561 F. 3d 1048,
1967 (10th Cir. 2009).
When evaluating a claimant’s statement about his or her symptoms,9 an ALJ must
perform a two-step process. SSR 96-7p, 1996 WL 374186, at *2. First, the ALJ must consider
whether the claimant has a medically determinable impairment that could reasonably be expected
to produce the alleged symptoms. Id.; see also 20 C.F.R. § 416.929(a). As noted above, ALJ
Hertzig determined that Ms. Farden’s depression was a medically determinable impairment. AR
“A symptom is an individual’s own description of his or her physical or mental impairment(s).”
SSR 96-7p, 1996 WL 374186, at *2.
Once the ALJ finds the existence of a medically determinable impairment, the ALJ must
then evaluate the intensity and persistence of the symptoms to determine how the symptoms limit
the claimant’s capacity for work. SSR 96-7p, 1996 WL 374186, at *2. “For this purpose,
whenever the individual’s statement about the intensity, persistence, or functionally limiting
effects of pain or other symptoms [is] not substantiated by objective medical evidence, the
adjudicator must make a finding on the credibility of the individual’s statements based on a
consideration of the entire case record.” Id.
Generally, a long medical history of an individual’s attempts to seek treatment for his or
her alleged symptoms and following the recommended treatment lends support to an individual’s
allegations. SSR 96-7p, 1996 WL 374186, at *7.
On the other hand, the individual’s statements may be less credible if the
level or frequency of treatment is inconsistent with the level of complaints, or if
the medical reports or records show that the individual is not following the
treatment as prescribed and there are no good reasons for this failure.
Id. Social Security Ruling 96-7p lists several examples that an individual may provide for failing
to seek treatment,10 including “[t]he individual may be unable to afford treatment and may not
The examples include:
* The individual’s daily activities may be structured so as to minimize symptoms
to a tolerable level or eliminate them entirely, avoiding physical or mental
stressors that would exacerbate the symptoms. The individual may be living with
the symptoms, seeing a medical source only as needed for periodic evaluation and
renewal of medications.
* The individual’s symptoms may not be severe enough to prompt the individual
to seek ongoing medical attention or may be relieved with over-the-counter
* The individual may not take prescription medication because the side effects are
less tolerable than the symptoms.
* The individual may be unable to afford treatment and may not have access to
free or low-cost medical services.
* The individual may have been advised by a medical source that there is no
further, effective treatment that can be prescribed and undertaken that would
benefit the individual.
have access to free or low-cost medical services.” SSR 96-7p, 1996 WL 374186, at *8.
Ms. Farden argues that while relying heavily on the fact that she did not seek treatment
for depression, ALJ Hertzig failed to consider her explanation for not doing so. Doc. 23 at 13–
14. In determining that her depressive disorder was nonsevere, ALJ Hertzig found that Ms.
Farden’s depressive disorder was nonsevere because she did not seek or receive “meaningful
treatment” for the condition. See Doc. 23 at 13–14; AR 846 (“[Ms. Farden] never maintained
meaningful mental health treatment or sought formal mental health evaluation . . . does not
appear to have been evaluated by a mental health professional other than  Dr. Gleaves . . . the
claimant is not shown to have maintained any mental health treatment after the visits to Dr.
Bulrice.”); AR 847 (“no evidence of meaningful mental health treatment and failed to appear for
a psychological consultative examination scheduled in August 2013 . . . but is clearly not shown
in the record to have sustained any psychotropic medication or other meaningful mental health
treatment . . . . During her return visit to Clovis in February 2015, the claimant did not mention
depression.”); AR 848 (Dr. Amusa “noted that the claimant mentioned anxiety and depression
only intermittently.”). In summarizing Ms. Farden’s depressive disorder, ALJ Hertzig stated:
Again, since the March 2007 alleged onset date, the claimant complained
on a few occasions of marked to extreme depression or anxiety, yet remained
relatively unremarkable on most mental status examinations. She is not shown to
have maintained any meaningful psychotropic medications since 2007, never
sought formal mental health evaluation, and failed [to attend] a scheduled
psychological consultative examination in August 2013.
AR 848. Accordingly, ALJ Hertzig concluded that Ms. Farden’s “medically determinable
mental impairment of major depression, unspecified, considered singly and in combination, did
* Medical treatment may be contrary to the teaching and tenets of the individual’s
SSR 96-7p, 1996 WL 374186, at *8.
not cause more than minimal limitation in [Ms. Farden’s] ability to perform basic mental work
activities and was, therefore, not ‘severe.’” Id.
Although he does not specifically say so, ALJ Hertzig necessarily concluded that Ms.
Farden’s explanation for failing to seek treatment was not credible. To rely on the claimant’s
failure to pursue treatment as support for a finding of noncredibility, the ALJ should consider
four factors: “(1) whether the treatment at issue would restore claimant’s ability to work; (2)
whether the treatment was prescribed; (3) whether the treatment was refused; and, if so, (4)
whether the refusal was without justifiable excuse.” Thompson v. Sullivan, 987 F.2d 1482, 1490
(10th Cir.1993). This analysis applies to cases in which the claimant fails to pursue medical
treatment because he or she cannot afford it. See id. at 1489–90.
During the June 2010 hearing, Ms. Farden testified that she was supposed to be seeing a
psychologist, but she did not have the financial means to obtain treatment. See AR 40–41. Ms.
Farden noted that the cost of transportation on the bus made obtaining treatment impossible
given her monthly income. AR 41. This evidence provides an alternative explanation—other
than lack of functional impairment—for Ms. Farden’s failure to obtain treatment. Despite this
uncontroverted evidence, ALJ Hertzig did not consider the Thompson factors. Specifically, ALJ
Hertzig failed to consider whether Ms. Farden’s failure to seek treatment was justifiable based on
her inability to afford care. ALJ Hertzig also did not consider the other factors, requiring
The ALJ failed to apply the legal standards in SSR 96-7p when assessing Ms. Farden’s
credibility. He failed to take into account Ms. Farden’s inability to pay for mental health
services while at the same time relying on her lack of treatment for depression.
IT IS THEREFORE ORDERED that plaintiff Diane Marie Farden’s Motion to Reverse
or Remand Administrative Agency Decision (Doc. 23) is GRANTED. The decision of the
Commissioner is REVERSED and REMANDED for further proceedings consistent with this
United States Magistrate Judge
Presiding by Consent
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