[Federal Register Volume 63, Number 104 (Monday, June 1, 1998)]
[Notices]
[Pages 29771-29773]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-14265]


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SOCIAL SECURITY ADMINISTRATION

[Social Security Acquiescence Ruling
98-4(6)]


Drummond v. Commissioner of Social Security; Effect of Prior 
Findings on Adjudication of a Subsequent Disability Claim Arising Under 
the Same Title of the Social Security Act--Titles II and XVI of the 
Social Security Act

AGENCY: Social Security Administration.

ACTION: Notice of Social Security Acquiescence Ruling.

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SUMMARY: In accordance with 20 CFR 402.35(b)(2), the Commissioner of 
Social Security gives notice of Social Security Acquiescence Ruling 98-
4(6).

EFFECTIVE DATE: June 1, 1998.

FOR FURTHER INFORMATION CONTACT:
Gary Sargent, Litigation Staff, Social Security Administration, 6401 
Security Boulevard, Baltimore, MD 21235, (410) 965-1695.

SUPPLEMENTARY INFORMATION: Although not required to do so pursuant to 5 
U.S.C. 552(a)(1) and (a)(2), we are publishing this Social Security 
Acquiescence Ruling in accordance with 20 CFR 402.35(b)(2).
    A Social Security Acquiescence Ruling explains how we will apply a 
holding in a decision of a United States Court of Appeals that we 
determine conflicts with our interpretation of a provision of the 
Social Security Act (the Act) or regulations when the Government has 
decided not to seek further review of that decision or is unsuccessful 
on further review.
    We will apply the holding of the Court of Appeals' decision as 
explained in this Social Security Acquiescence Ruling to claims at all 
levels of administrative adjudication within the Sixth Circuit. This 
Social Security Acquiescence Ruling will apply to all determinations 
and decisions made on or after June 1, 1998. If we made a determination 
or decision on your application for benefits between September 30, 
1997, the date of the Court of Appeals' decision, and (Insert the 
Federal Register publication date), the effective date of this Social 
Security Acquiescence Ruling, you may request application of the Social 
Security Acquiescence Ruling to your claim if you first demonstrate, 
pursuant to 20 CFR 404.985(b) or 416.1485(b), that application of the 
Ruling could change our prior determination or decision.
    If this Social Security Acquiescence Ruling is later rescinded as 
obsolete, we will publish a notice in the Federal Register to that 
effect as provided for in

[[Page 29772]]

20 CFR 404.985(e) or 416.1485(e). If we decide to relitigate the issue 
covered by this Social Security Acquiescence Ruling as provided for by 
20 CFR 404.985(c) or 416.1485(c), we will publish a notice in the 
Federal Register stating that we will apply our interpretation of the 
Act or regulations involved and explaining why we have decided to 
relitigate the issue.

(Catalog of Federal Domestic Assistance Program Nos. 96.001 Social 
Security - Disability Insurance; 96.002 Social Security - Retirement 
Insurance; 96.004 Social Security -Survivors Insurance; 96.005 - 
Special Benefits for Disabled Coal Miners; 96.006 - Supplemental 
Security Income.)
    Dated: April 10, 1998.
Kenneth S. Apfel,
Commissioner of Social Security.

Acquiescence Ruling 98-4(6)

    Drummond v. Commissioner of Social Security, 126 F.3d 837 (6th Cir. 
1997)--Effect of Prior Findings on Adjudication of a Subsequent 
Disability Claim Arising Under the Same Title of the Social Security 
Act--Titles II and XVI of the Social Security Act.
    Issue: Whether, in making a disability determination or decision on 
a subsequent disability claim with respect to an unadjudicated period, 
where the claim arises under the same title of the Social Security Act 
(the Act) as a prior claim on which there has been a final decision by 
an Administrative Law Judge (ALJ) or the Appeals Council, the Social 
Security Administration (SSA) must adopt a finding of a claimant's 
residual functional capacity, or other finding required under the 
applicable sequential evaluation process for determining disability, 
made in the final decision by the ALJ or the Appeals Council on the 
prior disability claim.1
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    \1\ Although Drummond was a title II case, similar principles 
also apply to title XVI. Therefore, this Ruling extends to both 
title II and title XVI disability claims.
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    Statute/Regulation/Ruling Citation: Sections 205(a) and (h) and 
702(a)(5) of the Social Security Act (42 U.S.C. 405 (a) and (h) and 
902(a)(5)), 20 CFR 404.900, 404.957(c)(1), 416.1400, 416.1457(c)(1).
    Circuit: Sixth (Kentucky, Michigan, Ohio, Tennessee)
    Drummond v. Commissioner of Social Security, 126 F.3d 837 (6th Cir. 
1997).
    Applicability of Ruling: This Ruling applies to determinations or 
decisions at all administrative levels (i.e., initial, reconsideration, 
ALJ hearing and Appeals Council).
    Description of Case: Grace Drummond applied for disability 
insurance benefits on July 6, 1987, claiming a disability onset date of 
November 17, 1985. The claim was denied initially and upon 
reconsideration. A hearing was held before an ALJ who concluded that 
the claimant was not disabled and denied her claim. The ALJ found that 
Ms. Drummond was unable to perform her past relevant work but retained 
the residual functional capacity for sedentary work.
    Ms. Drummond filed a subsequent application for disability 
insurance benefits on June 21, 1989. This claim was denied initially 
and again upon reconsideration. After a hearing was held, an ALJ found 
that the claimant suffered from combined musculoskeletal and multiple 
body system impairments but retained the residual functional capacity 
for medium level work and could perform her past relevant work as a 
textile machine operator. Accordingly, the ALJ found that Ms. Drummond 
was not disabled. After the Appeals Council denied the claimant's 
request for review, she sought judicial review. The United States 
District Court for the Eastern District of Kentucky granted summary 
judgment to SSA finding that substantial evidence supported SSA's 
denial of benefits.
    On appeal to the Court of Appeals for the Sixth Circuit, Ms. 
Drummond argued that, based on principles of res judicata, the first 
ALJ's determination that she was limited to sedentary work must be 
followed by the second ALJ in the absence of evidence of an improvement 
in her condition since the first hearing. Declining to address this 
issue initially on appeal, the Sixth Circuit reversed the judgment of 
the district court and remanded the case with instructions to remand it 
to SSA for further proceedings to determine whether res judicata is 
applicable against SSA and, if so, whether there was substantial 
evidence to support a finding that the claimant's condition had 
improved since the time of her first application.2
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    \2\ Drummond v. Secretary of Health and Human Services, No. 92-
5649 (6th Cir. April 26, 1993).
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    On remand, after oral argument was held before the Appeals Council 
on September 27, 1993, the Appeals Council issued a decision denying 
Ms. Drummond's claim for disability insurance benefits. The Appeals 
Council found that 42 U.S.C. 405(h) could not be applied against SSA as 
a bar to prevent reconsideration of an issue because SSA was not a 
party to the benefits determination.
    Ms. Drummond sought judicial review of the Appeals Council's 
decision and the United States District Court for the Eastern District 
of Kentucky affirmed SSA's decision denying disability benefits. The 
district court found that ``administrative res judicata does not apply 
to the Commissioner when a transitory condition such as health is 
involved ....'' The claimant appealed this decision to United States 
Court of Appeals for the Sixth Circuit.
    Relying on the Fourth Circuit's decision in Lively v. Secretary of 
Health and Human Services, 820 F.2d 1391 (4th Cir. 1987), the claimant 
argued that res judicata applied and that, absent evidence of an 
improvement in her condition, the first ALJ's finding that she had a 
residual functional capacity limited to sedentary work was binding on 
SSA in deciding her subsequent claim.3 Noting the similarity 
between the Lively case and the case at bar, the Sixth Circuit observed 
that the court in Lively had relied on ``[p]rinciples of finality and 
fundamental fairness drawn from Sec. 405(h)'' to conclude that 
``evidence, not considered in the earlier proceeding, would be needed 
as an independent basis to sustain a finding [of the claimant's 
residual functional capacity] contrary to the final earlier 
finding.''4
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    \3\ In Lively, the Fourth Circuit held that where a final 
decision of SSA after a hearing on a prior disability claim 
contained a finding about a claimant's residual functional capacity, 
SSA may not make a different finding based on the same evidence when 
adjudicating a subsequent disability claim arising under the same 
title of the Act and covering a period not adjudicated in the 
decision on the prior claim. 820 F.2d at 1392. On July 7, 1994, SSA 
published Acquiescence Ruling 94-2(4) at 59 FR 34849 to reflect the 
holding in Lively.
    \4\ Lively, 820 F.2d at 1392.
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    Holding: The Court of Appeals for the Sixth Circuit found the 
reasoning of the Lively court persuasive and stated that ``[a]bsent 
evidence of an improvement in a claimant's condition, a subsequent ALJ 
is bound by the findings of a previous ALJ.'' The court held that SSA 
could not reexamine issues previously determined in the absence of new 
and additional evidence or changed circumstances. The court indicated 
that to allow such a reevaluation ``would contravene the reasoning 
behind 42 U.S.C. Sec. 405(h) which requires finality in the decisions 
of social security claimants.'' The Court of Appeals further stated 
that ``[j]ust as a social security claimant is barred from relitigating 
an issue that has been previously determined, so is the Commissioner.''
    After finding that there was no substantial evidence that Ms. 
Drummond's condition had improved significantly during the time period 
between the two ALJ hearings, the court

[[Page 29773]]

concluded that SSA was bound by its previous finding that the claimant 
was limited to sedentary work. The Court of Appeals thereupon reversed 
the judgment of the district court and remanded with instructions for 
the district court to remand the case to SSA for an award of benefits.

Statement as to How Drummond Differs From SSA Policy

    Under SSA policy, if a determination or decision on a disability 
claim has become final, the Agency may apply administrative res 
judicata with respect to a subsequent disability claim under the same 
title of the Act if the same parties, facts and issues are involved in 
both the prior and subsequent claims. However, if the subsequent claim 
involves deciding whether the claimant is disabled during a period that 
was not adjudicated in the final determination or decision on the prior 
claim, SSA considers the issue of disability with respect to the 
unadjudicated period to be a new issue that prevents the application of 
administrative res judicata. Thus, when adjudicating a subsequent 
disability claim involving an unadjudicated period, SSA considers the 
facts and issues de novo in determining disability with respect to the 
unadjudicated period.
    The Sixth Circuit concluded that where a final decision of SSA 
after a hearing on a prior disability claim contains a finding of a 
claimant's residual functional capacity, SSA may not make a different 
finding in adjudicating a subsequent disability claim with an 
unadjudicated period arising under the same title of the Act as the 
prior claim unless new and additional evidence or changed circumstances 
provide a basis for a different finding of the claimant's residual 
functional capacity.

Explanation of How SSA Will Apply The Drummond Decision Within The 
Circuit

    This Ruling applies only to disability findings in cases involving 
claimants who reside in Kentucky, Michigan, Ohio, or Tennessee at the 
time of the determination or decision on the subsequent claim at the 
initial, reconsideration, ALJ hearing or Appeals Council level. It 
applies only to a finding of a claimant's residual functional capacity 
or other finding required at a step in the sequential evaluation 
process for determining disability provided under 20 CFR 404.1520, 
416.920 or 416.924, as appropriate, which was made in a final decision 
by an ALJ or the Appeals Council on a prior disability 
claim.5
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    \5\ In making a finding of a claimant's residual functional 
capacity or other finding required to be made at a step in the 
applicable sequential evaluation process for determining disability 
provided under the specific sections of the regulations described 
above, an ALJ or the Appeals Council may have made certain 
subsidiary findings, such as a finding concerning the credibility of 
a claimant's testimony or statements. A subsidiary finding does not 
constitute a finding that is required at a step in the sequential 
evaluation process for determining disability provided under 20 CFR 
404.1520, 416.920 or 416.924.
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    When adjudicating a subsequent disability claim with an 
unadjudicated period arising under the same title of the Act as the 
prior claim, adjudicators must adopt such a finding from the final 
decision by an ALJ or the Appeals Council on the prior claim in 
determining whether the claimant is disabled with respect to the 
unadjudicated period unless there is new and material evidence relating 
to such a finding or there has been a change in the law, regulations or 
rulings affecting the finding or the method for arriving at the 
finding.
[FR Doc. 98-14265 Filed 5-29-98; 8:45 am]
BILLING CODE 4190-29-F