[Federal Register Volume 64, Number 102 (Thursday, May 27, 1999)]
[Notices]
[Pages 28853-28856]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 99-13510]
-----------------------------------------------------------------------
SOCIAL SECURITY ADMINISTRATION
[Social Security Acquiescence Ruling 99-3 (5)]
McQueen v. Apfel; Definition of Highly Marketable Skills for
Individuals Close to Retirement Age--Titles II and XVI of the Social
Security Act
AGENCY: Social Security Administration.
ACTION: Notice of Social Security Acquiescence Ruling.
-----------------------------------------------------------------------
SUMMARY: In accordance with 20 CFR 402.35(b)(2), the Commissioner of
Social Security gives notice of Social Security Acquiescence Ruling 99-
3 (5).
EFFECTIVE DATE: May 27, 1999.
FOR FURTHER INFORMATION CONTACT:
Cassia W. Parson, Litigation Staff, Social Security Administration,
6401 Security Boulevard, Baltimore, MD 21235, (410) 966-0446.
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
[[Page 28854]]
administrative review within the Fifth Circuit. This Social Security
Acquiescence Ruling will apply to all determinations or decisions made
on or after May 27, 1999. If we made a determination or decision on
your application for benefits between February 17, 1999, the date of
the Court of Appeals' decision, and May 27, 1999, the effective date of
this Social Security Acquiescence Ruling, you may request application
of the Social Security Acquiescence Ruling to the prior determination
or decision. You must demonstrate, pursuant to 20 CFR 404.985(b)(2) or
416.1485(b)(2), that application of the Ruling could change our prior
determination or decision in your case.
Additionally, when we received this precedential Court of Appeals'
decision and determined that a Social Security Acquiescence Ruling
might be required, we began to identify those claims that were pending
before us within the circuit and that might be subject to
readjudication if an Acquiescence Ruling were subsequently issued.
Because we determined that an Acquiescence Ruling is required and are
publishing this Social Security Acquiescence Ruling, we will send a
notice to those individuals whose claims we have identified which may
be affected by this Social Security Acquiescence Ruling. The notice
will provide information about the Acquiescence Ruling and the right to
request readjudication under the Ruling. It is not necessary for an
individual to receive a notice in order to request application of this
Social Security Acquiescence Ruling to the prior determination or
decision on his or her claim as provided in 20 CFR 404.985(b)(2) or
416.1485(b)(2), discussed above.
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 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: May 4, 1999.
Kenneth S. Apfel,
Commissioner of Social Security.
Acquiescence Ruling 99-3 (5)
McQueen v. Apfel, 168 F.3d 152 (5th Cir. 1999)--Definition of
Highly Marketable Skills for Individuals Close to Retirement Age--
Titles II and XVI of the Social Security Act.1
---------------------------------------------------------------------------
\1\ Although the court of appeals' decision in McQueen concerned
the interpretation of certain provisions of the title II disability
program regulations, the title XVI disability program regulations
contain provisions identical to those at issue in McQueen.
Therefore, this Ruling extends to both title II and title XVI
disability claims.
---------------------------------------------------------------------------
Issue: Whether the Social Security Administration (SSA) is required
to find that a claimant close to retirement age (60-64) and limited to
sedentary or light work has ``highly marketable'' skills before
determining that the claimant has transferable skills and, therefore,
is not disabled.
Statute/Regulation/Ruling Citation: Sections 223(d)(2)(A) and
1614(a)(3)(B) of the Social Security Act (42 U.S.C. 423(d)(2)(A) and
1382c(a)(3)(B)); 20 CFR 404.1520(f)(1), 404.1563(d), 404.1566(c),
416.920(f)(1), 416.963(d), 416.966(c); 20 CFR Part 404, Subpart P,
Appendix 2, sections 201.00(f) and 202.00(f); Social Security Ruling
82-41.
Circuit: Fifth (Louisiana, Mississippi and Texas).
McQueen v. Apfel, 168 F.3d 152 (5th Cir. 1999).
Applicability of Ruling: This Ruling applies to determinations or
decisions at all administrative levels of review (i.e., initial,
reconsideration, Administrative Law Judge (ALJ) hearing and Appeals
Council).
Description of Case: The claimant, Orie W. McQueen, applied for
disability insurance benefits claiming he had not worked since he
suffered an injury on September 10, 1992. Following the denial of his
application for benefits at both the initial and reconsideration steps
of the administrative review process, the claimant requested and
received a hearing before an ALJ, which was held on July 11, 1994. Mr.
McQueen, who had worked as a traveling insurance salesman, turned 60
years old on September 29, 1994, during the period following the
hearing and prior to the ALJ's decision on April 24, 1995.
The ALJ issued a decision finding that Mr. McQueen was not disabled
and denying his claim for disability benefits. The ALJ determined that
although Mr. McQueen's impairment was severe and prevented him from
doing his past work as a traveling insurance salesman, he possessed
work skills that were ``readily transferable to jobs within his
vocational profile'' and, therefore, must be found not disabled. In
reaching this decision, the ALJ relied, in part, on the testimony of a
vocational expert who testified that Mr. McQueen's skills in insurance
sales could be transferred to an in-office insurance job. Mr. McQueen
requested Appeals Council review of the ALJ's decision and the Appeals
Council denied his request for review.
The claimant sought judicial review of SSA's decision in district
court. The claimant contended, among other things, that the ALJ failed
to apply the correct legal standard applicable to the claimant's age
category in determining that Mr. McQueen was not disabled. The case was
referred to a magistrate judge who found that the district court had no
jurisdiction to consider whether the ALJ applied the wrong legal
standard. The magistrate also recommended upholding the ALJ's findings.
The district court adopted the magistrate's recommendations.
Mr. McQueen appealed to the Court of Appeals for the Fifth Circuit.
On appeal, the claimant argued that the ALJ adjudicated his claim as if
he were a person younger than 60 years old and applied the wrong
standard under the disability regulations. The claimant contended that
the ALJ was required under the regulations to find that he had skills
that were ``highly marketable''--and not just ``readily
transferable''--before deciding that he was not disabled. The Court of
Appeals for the Fifth Circuit determined that the district court had
jurisdiction to decide the issue of whether the ALJ applied the correct
legal standard in deciding Mr. McQueen's claim. Because the issue was
properly raised to the district court, the court of appeals concluded
that the issue was properly before it on appeal.
Holding: The Fifth Circuit noted that a claimant for disability
benefits bears the burden of proof for the first four steps of the
five-step sequential evaluation process for determining disability.
Once a claimant has satisfied his or her burden of proving at step four
that he or she is unable to perform his or her previous work as a
result of a severe impairment, the burden shifts to SSA at step five to
show the existence of other work in the national economy that the
claimant can perform, considering the claimant's residual functional
capacity, age, education and work experience. The court observed that
20 CFR 404.1563(d) of the regulations provides rules relating to the
consideration of a claimant's age for determinations at step five of
the evaluation process for persons age 55 or
[[Page 28855]]
over.2 Section 404.1563(d) states that if a claimant is of
advanced age (55 or over), has a severe impairment, and cannot do
medium work (see section 404.1567(c)), such claimant may not be able to
work unless he or she has skills that can be transferred to less
demanding jobs which exist in significant numbers in the national
economy. In addition, section 404.1563(d) states that ``[i]f you are
close to retirement age (60-64) and have a severe impairment, we will
not consider you able to adjust to sedentary or light work unless you
have skills which are highly marketable.''
---------------------------------------------------------------------------
\2\ Section 404.1563 and the corresponding title XVI regulation,
section 416.963, are entitled ``Your age as a vocational factor.''
Sections 404.1563(b)-(d) and 416.963(b)-(d) specify three age
categories: ``Younger person'' (under age 50); ``Person approaching
advanced age'' (age 50-54); and ``Person of advanced age'' (age 55
or over). The last category includes a subcategory--a person close
to retirement age (age 60-64).
---------------------------------------------------------------------------
The court of appeals observed that none of the hypothetical
questions concerning sedentary work which the ALJ posed to the
vocational expert at the hearing, and in subsequent written
interrogatories, asked the vocational expert whether a claimant with
Mr. McQueen's residual functional capacity and vocational
characteristics could still be expected to adjust to other work at age
60. The court further observed that there was nothing in the
hypothetical questions posed to the vocational expert, on whose
testimony the ALJ relied, to indicate that the ALJ considered the
standard in section 404.1563(d) for claimants close to retirement age.
In addition, the court noted that the Fifth Circuit had not yet
addressed the issue of whether section 404.1563(d) requires SSA to
``specifically find that a 60- to 64-year-old claimant has 'highly
marketable' skills in order to deny him disability benefits.'' The
court further noted that a number of other circuits and district courts
have found that the failure to make a specific finding on high
marketability renders [SSA's] decision unsupported by substantial
evidence.'' The court of appeals stated that it agreed with these
circuits and district courts. The court indicated that as of September
29, 1994, the date Mr. McQueen turned 60 years old, Mr. McQueen was
``close to retirement age'' for purposes of section 404.1563(d). The
court of appeals held, therefore, that with respect to benefits for the
period beginning on that date, SSA was required by the regulation to
find that Mr. McQueen possessed ``highly marketable'' skills before it
could find that Mr. McQueen had transferable skills and deny disability
benefits. The court determined that with respect to disability benefits
denied Mr. McQueen for that period, ``the ALJ's decision cannot stand
because it includes no finding that McQueen possessed highly marketable
skills.''
The court of appeals found that the ALJ's decision, as it related
to the period beginning September 29, 1994, was not supported by
substantial evidence, because it failed to treat Mr. McQueen as ``close
to retirement age'' and denied him disability benefits without a
finding under section 404.1563(d) that he possessed ``highly
marketable'' skills. In addition, the court stated that SSA's
``disregard for its own standards concerning McQueen's advanced age
does not constitute good cause for the failure to incorporate [into the
administrative case record] necessary evidence'' regarding the
marketability of the claimant's skills, ``[n]or does the record evince
any other good cause for that failure.'' The Fifth Circuit thereupon
reversed the judgment of the district court with instructions to remand
the case to SSA to grant Mr. McQueen's application and to calculate the
disability benefits due the claimant pursuant to the court's opinion.
Statement As To How McQueen Differs From SSA's Interpretation Of The
Regulations
At step five of the sequential evaluation process, SSA considers a
claimant's chronological age in conjunction with residual functional
capacity, education and work experience to determine whether a claimant
can do work other than past relevant work. SSA takes into account how
age affects a claimant's ability to adapt to new work situations and do
work in competition with others in the workplace.
To this end, SSA's regulations provide that in order to find that a
claimant whose sustained work capability is limited to light work or
less and who is close to retirement age (60-64) possesses skills that
can be used in (transferred to) other work, ``there must be very
little, if any, vocational adjustment required in terms of tools, work
processes, work settings, or the industry.'' 20 CFR Part 404, Subpart
P, Appendix 2, section 202.00(f). SSA's regulations provide the same
rule for a claimant whose sustained work capability is limited to
sedentary work and who is of advanced age (55 and over). 20 CFR Part
404, Subpart P, Appendix 2, Section 201.00(f). If the claimant's skills
are transferable to other work under this standard, SSA will consider
such skills ``highly marketable'' under 20 CFR 404.1563(d) and
416.963(d). SSA's regulations do not require a specific, separate and
distinct finding that a claimant's skills are ``highly marketable'' in
reaching a conclusion that the claimant has transferable skills.
The Fifth Circuit interpreted 20 CFR 404.1563(d) to require SSA to
make an additional finding regarding the marketability of a claimant's
skills in order to determine whether the skills of a claimant close to
retirement age are transferable to sedentary or light work. The court
held that in the absence of a finding by SSA that the skills of such a
claimant are ``highly marketable,'' SSA may not conclude that the
claimant possesses transferable skills and is not disabled.
Explanation of How SSA Will Apply the McQueen Decision Within the
Circuit
This Ruling applies only to cases in which the claimant resides in
Louisiana, Mississippi or Texas at the time of the determination or
decision at any level of administrative review, i.e., initial,
reconsideration, ALJ hearing or Appeals Council review.
In the case of a claimant whose sustained work capability is
limited to sedentary or light work as a result of a severe impairment,
who is close to retirement age (age 60-64), and who has skills, an
adjudicator will make a separate finding regarding the marketability of
the claimant's skills when determining whether the claimant's skills
are transferable to other work under the standard specified in section
201.00(f) or 202.00(f) of 20 CFR Part 404, Subpart P, Appendix 2.
Unless the adjudicator finds that the claimant's skills are ``highly
marketable,'' the adjudicator will conclude that the claimant's skills
are not transferable to other work even if the standard for finding
transferability of skills specified in section 201.00(f) or 202.00(f)
is otherwise met. For purposes of this Ruling, an adjudicator will
consider the claimant's skills to be ``highly marketable'' only if the
skills are sufficiently specialized and coveted by employers so as to
make the claimant's age irrelevant in the hiring process and enable the
claimant to obtain employment with little difficulty. In determining
whether a claimant's skills meet this definition of ``highly
marketable,'' an adjudicator will consider:
(1) whether the skills were acquired through specialized or
extensive education, training or experience; and
(2) whether the skills give the claimant a competitive edge over
other, younger, potential employees with
[[Page 28856]]
whom the claimant would compete for jobs requiring those skills, giving
consideration to the number of such jobs available and the number of
individuals competing for such jobs.3
---------------------------------------------------------------------------
\3\ Although the court did not adopt SSA's interpretation of
``highly marketable'' skills, the Fifth Circuit in McQueen also did
not set forth specific, alternative criteria for determining when a
claimant's skills may be considered ``highly marketable.''
Therefore, in the absence of a statement by the Fifth Circuit of a
specific definition, we have adopted, for purposes of this Ruling,
the standard articulated in Preslar v. Secretary of Health and Human
Services, 14 F.3d 1107 (6th Cir. 1994), for which we published
Acquiescence Ruling 95-1(6), for determining when the skills of a
claimant close to retirement age may be considered ``highly
marketable.'' Although this standard was not specifically adopted or
discussed by the court in McQueen, the court did cite the Preslar
decision in support of its holding in McQueen.
---------------------------------------------------------------------------
SSA intends to clarify the regulations at issue in this case, 20
CFR 404.1563 and 416.963, through the rule making process and may
rescind this Ruling once such clarification is made.
[FR Doc. 99-13510 Filed 5-26-99; 8:45 am]
BILLING CODE 4190-29-F