[Federal Register Volume 65, Number 221 (Wednesday, November 15, 2000)]
[Notices]
[Pages 69116-69118]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 00-29191]


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SOCIAL SECURITY ADMINISTRATION

[Social Security Acquiescence Ruling 00-5 (6)]


Salamalekis v. Apfel; Entitlement to Trial Work Period Before 
Approval of an Award of Benefits and Before 12 Months Have Elapsed 
Since the Alleged Onset of Disability--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 00-
5(6).

EFFECTIVE DATE: November 15, 2000.

FOR FURTHER INFORMATION CONTACT: Cassia W. Parson, Litigation Staff, 
Social Security Administration, 6401 Security Boulevard, Baltimore, MD 
21235-6401, (410) 966-0446.

SUPPLEMENTARY INFORMATION: 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 review within the Sixth Circuit. This Social 
Security Acquiescence Ruling will apply to all determinations or 
decisions made on or after November 15, 2000. If we made a 
determination or decision on your application for benefits between July 
20, 2000, the date of the Court of Appeals' decision, and November 15, 
2000, 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 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 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 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: October 19, 2000.
Kenneth S. Apfel,
Commissioner of Social Security.

Acquiescence Ruling 00-5 (6)

    Salamalekis v. Apfel, 221 F.3d 828 (6th Cir. 2000)--Entitlement to 
Trial Work Period Before Approval of an Award of Benefits and Before 12 
Months Have Elapsed Since the Alleged Onset of Disability--Titles II 
and XVI of the Social Security Act.
    Issue: Whether a claimant's return to substantial gainful activity 
(SGA) within 12 months of the alleged onset date of his or her 
disability, and prior to an award of benefits, precludes an award of 
benefits and entitlement to a trial work period.
    Statute/Regulation/Ruling Citation: Sections 222(c), 223, 
1614(a)(3) and (4) and 1619 of the Social Security Act (42 U.S.C. 
422(c), 423, 1382c(a)(3) and (4) and 1382h); 20 CFR 404.1505, 404.1520, 
404.1592, 416.905, 416.906, 416.920; Social Security Ruling (SSR) 82-
52.
    Circuit: Sixth (Kentucky, Michigan, Ohio, Tennessee).
    Salamalekis v. Apfel, 221 F.3d 828 (6th Cir. 2000).
    Applicability of Ruling: This Ruling applies to determinations or 
decisions at all administrative levels (i.e., initial, reconsideration, 
Administrative Law Judge (ALJ) hearing and Appeals Council).
    Description of Case: Manuel G. Salamalekis applied for Social 
Security disability insurance benefits on October 1, 1991, alleging 
disability since April 24, 1991, due to a heart condition and 
Parkinson's Disease. On March 2, 1992, less than a year after the 
alleged onset of disability, Mr. Salamalekis returned to work and 
promptly notified the Agency of his return. On the same day that Mr. 
Salamalekis returned to work, we ``determined he was entitled to 
receive disability insurance benefits'' and an award notice was sent to 
Mr. Salamalekis on March 8, 1992. It was not disputed that we were 
unaware that Mr. Salamalekis had returned to work when we determined 
his eligibility for benefits. We subsequently learned of his return to 
work. In May of 1992, we notified Mr. Salamalekis that his claim would 
be reviewed when his ``9th month of trial work'' ended. He

[[Page 69117]]

continued to work and received benefits for approximately the next 2 
years.
    On March 25, 1994, we notified Mr. Salamalekis that we intended to 
revise our initial award determination finding him disabled to a 
determination that he was never disabled because he returned to work on 
March 2, 1992, prior to the Agency's award of benefits and less than 12 
months after the onset of his impairment. We revised our initial award 
determination, ceased payment of Mr. Salamalekis' benefits and assessed 
him with a $30,080.20 overpayment. An ALJ affirmed the revised 
determination and the Appeals Council denied review. Mr. Salamalekis 
sought judicial review in the Federal district court where a United 
States Magistrate Judge affirmed SSA's final decision.
    On his appeal to the United States Court of Appeals for the Sixth 
Circuit, Mr. Salamalekis argued that he was disabled and was entitled 
to a 9-month trial work period beginning with his return to work in 
March 1992, plus a 3-month reentitlement period. For this reason, Mr. 
Salamalekis contended that the Agency should not have considered his 
work during this period as evidence of substantial gainful activity 
demonstrating that he was not disabled.
    Holding: The Sixth Circuit held that Mr. Salamalekis was entitled 
to a trial work period regardless of whether he returned to work before 
or after SSA's award of benefits. Consequently, it reversed and 
remanded the case to the district court with instructions to return the 
case to SSA for a recalculation of the overpayments owed by Mr. 
Salamalekis. The court found that according to the plain language of 
the Social Security Act (the Act), an individual may take advantage of 
a trial work period once he becomes entitled to disability insurance 
benefits.
    According to the court, Mr. Salamalekis had satisfied all five 
prerequisites for entitlement to benefits under section 223(a) of the 
Act when he returned to his job. He was insured for disability 
insurance benefits; he was below retirement age; he filed an 
application for benefits; the 5-month waiting period had expired; and 
he was under a disability. The court rejected the Agency's argument 
that it should apply SSR 82-52 and find that Mr. Salamalekis was never 
disabled in view of his return to work within 12 months of his alleged 
disability onset date. In so doing, the court noted that at the time 
Mr. Salamalekis returned to work his impairment was ongoing and was 
expected to last for 12 months.
    The court found that the relevant language from SSR 82-52 was 
inconsistent with the plain language of the Act. In addition, the court 
noted ``the Seventh, Eighth and Tenth Circuits have also held that a 
claimant is entitled to a trial work period if the waiting period has 
expired and the claimant's impairment is expected to last for 12 
months, regardless of whether the Agency has made an award 
determination and regardless of whether the impairment has actually 
lasted 12 months.'' 1
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    \1\ The courts in Newton v. Chater, 92 F.3d 688 (8th Cir. 1996); 
Walker v. Secretary of Health and Human Services, 943 F.2d 1257 
(10th Cir. 1991); McDonald v. Bowen, 818 F.2d 559 (7th Cir. 1986) 
found that the pertinent provision of SSR 82-52 was inconsistent 
with the Social Security Act.
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Statement as to How Salamalekis Differs From SSA's Interpretation of 
the Social Security Act

    Under the Act, an individual who is entitled to disability 
insurance benefits is generally entitled to a trial work period. The 
individual can test his or her ability to work for up to 9 months 
without that work activity affecting his or her entitlement to 
benefits. However, to be entitled to a trial work period, the 
individual must be entitled to disability insurance benefits. In order 
to be entitled to disability insurance benefits, the individual must be 
disabled, i.e., he or she must have an impairment that has prevented, 
or can be expected to prevent him or her from performing substantial 
gainful activityfor at least 12 months. See Sections 223(a)(1)(D) and 
(d)(1)(A) of the Act.
    SSR 82-52 contains a clear statement of SSA policy on this issue 
2 as follows:
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    \2\ SSR 91-7c superseded SSR 82-52, but only to the extent that 
SSR 82-52 discussed former procedures used to determine disability 
in children. The issue in this AR does not relate to those former 
procedures and the cited policy statement in SSR 82-52 remains in 
effect.

    When the [individual's] return to work demonstrating ability to 
engage in SGA occurs before approval of the award and prior to the 
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lapse of the 12-month period after onset, the claim must be denied.

    The Sixth Circuit held, however, that SSR 82-52 is inconsistent 
with the plain language of section 222(c) of the Act.3 The 
holding in Salamalekis is inconsistent with our policy because it 
permits a claimant to be found to be under a disability, and entitled 
to benefits and a trial work period even if he or she engages in work 
activity demonstrating the ability to engage in substantial gainful 
activity before the lapse of the 12-month period after the alleged 
disability onset date and before a decision by SSA to award 
benefits.4 Our interpretation is that a claimant cannot be 
found to have been under a disability if, at the time we are 
adjudicating the claim, the evidence shows that his or her impairment 
no longer prevents the performance of substantial gainful activity and 
that it had not done so for at least 12 continuous months. In the 
preamble to our August 10, 2000, final rules, we explain why we believe 
that this interpretation is consistent with the relevant statutory 
language and with the legislative history of the 12-month duration 
requirement. That legislative history indicates that Congress intended 
that the disability program not ``result in the payment of disability 
benefits in cases of short-term, temporary disability.'' 5
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    \3\ Section 222(c)(2) of the Act provides that ``any services 
rendered by an individual during a period of trial work shall be 
deemed not to have been rendered by such individual in determining 
whether disability has ceased in a month during such period.'' 
Section 222(c)(3) of the Act provides, in pertinent part, that ``[a] 
period of trial work for any individual shall begin with the month 
in which he becomes entitled to disability insurance benefits * * * 
'' Under section 222(c)(4) of the Act, a trial work period ends with 
the ninth month, in any period of 60 consecutive months, in which 
the individual renders services (whether or not the 9 months are 
consecutive), or, if earlier, with the month in which disability 
ceases.
    \4\ While the court in Salamalekis addressed SSR 82-52 in its 
opinion issued July 20, 2000, it should be noted that final rules 
that reflect, clarify, and provide a more detailed explanation and 
justification for the SSR 82-52 policy at issue were published in 
the Federal Register on July 11, 2000 (65 FR 42772) with an 
effective date of August 10. The court in Salamalekis, apparently 
unaware of the July 11th publication, simply noted that the proposed 
rules to incorporate SSA's position in SSR 82-52 had been published, 
but had not been finalized; the court did not discuss the more 
detailed explanation and justification for our policy provided in 
the preamble to the final rules.
    \5\ That legislative history is found at S. Rep. No. 404, 89th 
Cong. 1st Sess. 98-99, reprinted in 1965 U.S. Code Cong. & Ad. News, 
1943, 2038-39.
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Explanation of How SSA Will Apply The Salamalekis Decision Within the 
Circuit

    This Ruling applies only to cases in which the claimant resides or 
resided in Kentucky, Michigan, Ohio or Tennessee at the time of the 
determination or decision at any level of administrative review, i.e., 
initial, reconsideration, ALJ hearing or Appeals Council review.
    This Ruling applies to claims for title II benefits based on 
disability. It also applies to claims for title XVI benefits based on 
disability as explained below.
    A claim for title II disability insurance benefits, widow(er)'s 
insurance benefits based on disability or child's insurance benefits 
based on disability in which the claimant returns to work within 12 
months of the established onset date of an impairment which could 
otherwise be the basis for a finding of disability should be allowed 
and the claimant granted a trial work period if the following 
conditions are met:

[[Page 69118]]

    (1) the claimant establishes that, at the time he or she returned 
to work and thereafter, the impairment was still expected to last for 
at least 12 consecutive months from the date of onset;
    (2) the claimant returns to work after the waiting period (if a 
waiting period is applicable) but within the 12-month period following 
the established onset date; and
    (3) the return to work demonstrating an ability to engage in 
substantial gainful activity occurs either before or after approval of 
the award.
    A claim for title XVI benefits based on disability in which the 
claimant returns to work within 12 months of the established onset date 
of an impairment which could otherwise be the basis for a finding of 
disability should be allowed and the claimant granted section 1619 
status 6 if the following conditions are met:
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    \6\ Pursuant to statutory amendments made by Public Law 99-643, 
effective July 1, 1987, the trial work period provisions no longer 
apply to title XVI disability claims. Beginning July 1, 1987, a 
disabled individual, who was eligible to receive ``regular'' SSI 
benefits under section 1611 of the Act (or a federally administered 
State supplementary payment) for a month and subsequently has 
earnings ordinarily considered to represent substantial gainful 
activity, will move directly to section 1619 status rather than be 
accorded a trial work period. This Ruling extends to such 
individuals, i.e., a claim for title XVI benefits based on 
disability should be allowed and the claimant granted section 1619 
status if the claimant would otherwise be eligible for section 1619 
status and the same conditions set out above for title II claims 
based on disability are met.
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    (1) The claimant establishes that, at the time he or she returned 
to work and thereafter, the impairment was still expected to last for 
at least 12 consecutive months from the date of onset;
    (2) The claimant returns to work in a month subsequent to the month 
of established onset but within the 12-month period following the 
established onset date;
    (3) The claimant is eligible to receive ``regular'' SSI benefits 
under section 1611 of the Act (or a federally administered State 
supplementary payment) based on the impairment (disregarding the effect 
the claimant's return to work within 12 months after the date of onset 
would otherwise have on eligibility for such benefits or payment) for 
at least 1 month in the period preceding the month in which he or she 
returns to work;
    (4) The claimant meets all other nondisability requirements for 
section 1619 status; and
    (5) The return to work demonstrating an ability to engage in 
substantial gainful activity occurs either before or after approval of 
the award.
[FR Doc. 00-29191 Filed 11-14-00; 8:45 am]
BILLING CODE 4190-29