[Federal Register Volume 70, Number 143 (Wednesday, July 27, 2005)]
[Proposed Rules]
[Pages 43590-43624]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 05-14845]



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Part V





Social Security Administration





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20 CFR Parts 404, 405, 416, and 422



Administrative Review Process for Adjudicating Initial Disability 
Claims; Proposed Rule

  Federal Register / Vol. 70, No. 143 / Wednesday, July 27, 2005 / 
Proposed Rules  

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SOCIAL SECURITY ADMINISTRATION

20 CFR Parts 404, 405, 416, and 422

[Regulation Nos. 4, 5, 16, and 22]
RIN 0960-AG31


Administrative Review Process for Adjudicating Initial Disability 
Claims

AGENCY: Social Security Administration (SSA).

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Social Security Administration is committed to providing 
the type of service the American people expect and deserve. In light of 
the significant growth in disability claims, the increased complexity 
of those claims, and the younger age of beneficiaries in recent years, 
the need to make substantial changes in our disability determination 
process has become urgent. We propose to amend our administrative 
review process for benefit claims you file under title II of the Social 
Security Act (Act) based on disability, and for applications you file 
for supplemental security income (SSI) payments based on disability or 
blindness under title XVI of the Act. We expect that the changes we are 
proposing will improve the accuracy, consistency, and timeliness of 
decision making throughout the disability determination process.

DATES: To be sure that we consider your comments, we must receive them 
by October 25, 2005.

ADDRESSES: You may give us your comments by: using our Internet site 
facility (i.e., Social Security Online) at http://policy.ssa.gov/pnpublic.nsf/LawsRegs or the Federal eRulemaking Portal at http://www.regulations.gov; e-mail to [email protected]; telefax to (410) 
966-2830; or letter to the Commissioner of Social Security, PO Box 
17703, Baltimore, MD 21235-7703. You may also deliver them to the 
Office of Disability and Income Security Programs, Office of 
Regulations, Social Security Administration, 100 Altmeyer Building, 
6401 Security Boulevard, Baltimore, MD 21235-6401, between 8 a.m. and 
4:30 p.m. on regular business days. Comments are posted on our Internet 
site. You also may inspect the comments on regular business days by 
making arrangements with the contact person shown in the preamble.

Electronic Version

    The electronic file of this document is available on the date of 
publication in the Federal Register on the Internet site for the 
Government Printing Office at www.gpoaccess.gov/fr/index.html. It is 
also available on the Internet site for SSA (i.e., Social Security 
Online) at http://policy.ssa.gov/pnpublic.nsf/LawsRegs.

FOR FURTHER INFORMATION CONTACT: Mary Chatel, Executive Director, 
Disability Service Improvement, Social Security Administration, 500 E 
Street, SW, Suite 854, Washington DC, 20254, 202-358-6094 or TTY 410-
966-5609, for information about this notice. For information on 
eligibility or filing for benefits, call our national toll-free number, 
1-800-772-1213 or TTY 1-800-325-0778, or visit our Internet site, 
Social Security Online, at www.socialsecurity.gov.

SUPPLEMENTARY INFORMATION:

Background

    We propose to amend our administrative review process for Social 
Security benefit claims based on disability and for applications for 
SSI payments based on disability or blindness in order to improve the 
accuracy, consistency, and timeliness of decision making throughout the 
disability determination process. We expect that our proposed changes 
will significantly reduce average disability determination processing 
time, increase decisional consistency and accuracy, and ensure that the 
right determination or decision is made as early in the disability 
determination process as possible. Our proposed changes will ensure 
that beneficiaries who are clearly disabled receive determinations 
within 20 calendar days or less of the date that their completed 
application for benefits is sent to the State agency for adjudication. 
We believe that our proposed changes will ensure that adjudicators are 
held accountable for the quality of disability adjudications made at 
every step of the process. In addition, we believe that our proposed 
changes will help ensure that disability claimants provide all material 
evidence to adjudicators in a timely manner, resulting in a more 
efficient disability determination process.

Program Trends

    We currently decide claims for Social Security benefits based on 
disability under title II of the Act and for SSI based on disability or 
blindness under title XVI of the Act using an administrative review 
process that consists of four levels. Initial determinations as to 
whether or not you are disabled are made by a State agency. If you are 
dissatisfied with the initial determination, you may request 
reconsideration by the State agency. If you are dissatisfied with the 
reconsidered determination, you may request a hearing, which is held by 
an administrative law judge. Finally, if you are dissatisfied with the 
administrative law judge's decision, you may request review by the 
Appeals Council. Once you have completed these administrative steps and 
received our final decision, you may request judicial review of the 
final decision in Federal district court.
    Over the years the Social Security and SSI disability programs have 
grown in size and complexity. There has been significant growth in the 
number of individuals who file claims for disability benefits each 
year. During the early years of the Social Security disability program, 
the number of claims for disability benefits filed each year was 
measured in the hundreds of thousands. Currently, more than two and a 
half million individuals apply for Social Security and SSI benefits 
based on disability each year. The volume of claims will grow even more 
in future years as baby boomers move into their disability-prone years.
    The factors involved in determining disability claims have also 
changed. Since the beginning of the disability programs, the percentage 
of claims involving allegations of mental impairments has increased 
dramatically, particularly in the SSI program. Claims of disability 
involving mental impairments raise particular administrative resource 
issues because they involve complex psychological issues, and the 
evidence for these claims may be difficult to develop. The number of 
claims being decided on the basis of vocational considerations rather 
than meeting or equaling more readily determinable medical factors has 
also been increasing steadily. Thus, in addition to the exponential 
growth in the number of disability claims that must be adjudicated each 
year, there has been a corresponding increase in the complexity of 
those claims.
    In addition, the average age of beneficiaries has fallen over the 
years because an increasing number of younger individuals have been 
found to be disabled. This trend has heightened the importance of 
improving our efforts to assist disabled individuals in returning to 
the workforce.
    All of these trends have underscored the need for substantial 
change if our disability decision making process is to be able to 
provide claimants with accurate, fair, and consistent adjudications as 
early in the adjudication process as possible, and also provide them 
with the assistance they need to overcome barriers to employment.

[[Page 43591]]

The Service Delivery Budget Assessment

    In 2001, we established a Service Delivery Budget Assessment Team 
to thoroughly investigate the current disability determination process 
from the perspective of an applicant for disability benefits. We hoped 
that this process would help us to understand and effectively manage 
the administrative challenges posed by growth and other changes in the 
disability programs. The team's research revealed that: (1) State 
Disability Determination Services (DDS) generally made an initial 
eligibility determination within three and a half months of a 
claimant's application; (2) forty percent of disability claimants were 
determined to be eligible for benefits at this initial stage; and (3) 
it took an average of 1153 days to pursue a disability claim through 
all stages of administrative appeal to obtain a final Agency decision.
    The Team discovered that only seven days of this 1153-day period 
were spent actually working on the claim. Six hundred and twenty one 
days of this period were associated with delays in the administrative 
process, such as time spent waiting for an appointment or hearing, time 
spent waiting for forms to be sent in the mail, time spent waiting for 
medical reports and consultative examinations to be completed and 
received, and time spent attempting to locate misrouted or lost paper 
folders. One-third of these 621 days involved the mandatory delays 
associated with the due process rights of claimants, such as the 60-day 
time periods established in the Act and in our regulations for filing 
appeals after each of the first three adjudicatory levels. The Team 
also discovered that 525 days of the 1153-day period were related to 
the backlog of cases that are pending at each level of the 
administrative review process. As the backlogs are reduced, the amount 
of time spent waiting for the next action in the case will also be 
reduced.

Transition to an Electronic Disability Process

    In an effort to improve the efficiency and timeliness of our 
disability determination process, we decided to accelerate our 
transition to an electronic disability process--one we usually refer to 
as eDib. In an electronic disability process, applications, claimant 
information, and medical evidence that have been processed in paper 
form in the past are processed in electronic form instead. Each 
adjudicative component involved in the disability determination process 
is able to work with claims by electronically accessing and retrieving 
information that is collected, produced, and stored as part of an 
electronic disability folder. This significantly reduces the delays 
that result from mailing, locating, and organizing paper folders. In 
addition, an electronic disability process allows more than one Agency 
component to work on a single claim at the same time if necessary, 
which alleviates the delays associated with transferring paper records 
from one component to another.
    We also believe that the transition to an electronic disability 
process will improve the accuracy and integrity of our disability 
determination process. We have been impressed with the successful 
efforts of the Department of Veterans Affairs to offer patients an 
electronic health record. We understand that their reliance on an 
electronic health record has reduced errors and streamlined their 
record keeping process. We expect that our transition to an electronic 
disability process will help us avoid the kind of errors that result 
from misunderstanding handwritten notes, or misplacing or improperly 
filing important documents that are part of the record.
    We expect that as eDib continues to be implemented throughout the 
country, the amount of time needed to process disability claims will 
decrease because claim files will be transferred instantly in 
electronic form between our offices. As eDib is implemented, we expect 
to reduce and eventually eliminate the delays currently associated with 
waiting for forms to be sent in the mail and with time spent attempting 
to locate misrouted or lost paper folders.
    The transition to this new electronic disability process is 
currently taking place throughout the country. All of our field offices 
across the nation are now using the Electronic Disability Collect 
System (EDCS) that provides State agencies with an electronic folder. 
EDib was implemented at the first State agency DDS in January 2004, and 
additional State agency DDSs have continued to implement eDib ever 
since. Currently, all State agency DDSs, except New York, which is 
scheduled for rollout in November 2005, are adjudicating disability 
claims using an electronic folder.
    At the same time, our Office of Hearings and Appeals (OHA) has 
begun using the Case Processing and Management System (CPMS), which is 
a new software system for processing cases and managing OHA office 
workloads. CPMS will enable OHA to work with the electronic file. 
Currently, all 140 hearing offices across the country are using CPMS 
and 73 hearing offices have been trained to begin adjudicating cases 
using an electronic folder.
    The complete implementation of eDib throughout the country and at 
every level of the adjudicatory process will assist us in addressing to 
a significant degree the unacceptably long case processing times 
described earlier. EDib provides opportunities to manage and process 
workloads in ways that have not existed until now. However, eDib alone 
is not enough to improve the current process to the level that we 
believe is necessary. Further actions must be taken to improve our 
ability to adjudicate every claim in a prompt, fair, and accurate 
manner. We have concluded that to significantly improve disability 
adjudications, we must change the process itself. In addition, we 
believe we must revisit and update some of our policies regarding 
disability adjudications, including the revision and updating of 
medical listings, in order to sufficiently improve the entire process.

Answering the President's Questions

    In formulating a new approach to improving the disability 
determination process, we were guided by three questions that the 
President of the United States posed during a meeting with the 
Commissioner in the spring of 2002. These questions were: (1) Why does 
it take so long to make a disability decision?
    (2) Why can't people who are obviously disabled get a decision 
immediately?
    (3) Why would a disability program beneficiary risk attempting to 
work after having gone through such a long disability determination 
process and having been found to be disabled?
    In order to fully address the central and important issues raised 
by the President's three questions, we designed an approach that 
focuses on two over-arching goals: (1) to make the right decision as 
early in the process as possible; and (2) to foster return to work at 
all stages of the process.

New Approach To Improve the Disability Determination Process

    At a September 25, 2003 hearing before the House Ways and Means 
Subcommittee on Social Security, we first presented a new approach to 
improve the disability determination process. This new approach 
maintained some of the significant features of the current disability 
determination process:
     Initial claims for disability would continue to be handled 
by our field offices;

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     The State DDSs would continue to adjudicate claims for 
benefits;
     Administrative law judges would continue to conduct de 
novo hearings and issue decisions; and
     Claimants would still be able to appeal the Agency's final 
decision to the Federal courts.
    As we outlined in September 2003, the new approach also reflected 
some important differences from the current system:
     A Quick Disability Determination process would be 
established at the outset of the claims process to identify people who 
are clearly disabled;
     Medical and vocational expertise within a new Federal 
expert unit would be available to disability decision makers at all 
levels of the process, including the DDSs, reviewing officials, and 
administrative law judges;
     We would eliminate the reconsideration step of the 
administrative review process and end the disability prototype test 
being conducted in 10 States;
     We would institute both in-line and end-of-line quality 
assurance programs at every step of the process (but the hearing level 
in-line quality assurance program would not apply to administrative law 
judge decision making);
     Following the initial determination made by the DDS, a 
Federal reviewing official would review the claim upon the claimant's 
request. The reviewing official would be authorized to issue an 
allowance or to deny the claim. If the reviewing official did not allow 
the claim, he or she would be required to explain why the disability 
claim should be denied;
     If requested by a claimant who was dissatisfied with the 
reviewing official's decision, an administrative law judge would 
conduct an administrative hearing. If the administrative law judge 
determined that a favorable decision should be made, the administrative 
law judge would explain the basis for disagreeing with the reviewing 
official's decision;
     Claimants could continue to submit evidence to support 
their claim through the administrative law judge level of review. 
However, the record would be closed after the administrative law judge 
decision was issued;
     The Appeals Council stage of the current process would be 
eliminated. A portion of administrative law judge decisions would be 
reviewed by a centralized quality control staff. If the administrative 
law judge's decision was not chosen to be reviewed by the centralized 
quality control staff, the decision of the administrative law judge 
would become the final Agency decision;
     If the centralized quality control staff disagreed with an 
administrative law judge's decision, the disability claim would be 
referred to an Oversight Panel, consisting of two administrative law 
judges and one Administrative Appeals Judge. The Oversight Panel could 
affirm, modify, or reverse the administrative law judge's decision, 
making the panel's decision the final Agency decision;
     We would improve the quality of the administrative record 
by ensuring that evidence development is performed early in the 
disability determination process, and by ensuring that adjudicators 
sufficiently articulate the basis of their adjudications.

The Work Opportunity Initiative

    We have recently implemented a number of work incentive programs 
that are designed to encourage an individual's return to work. 
Currently, beneficiaries may take advantage of several work incentive 
programs, including our Ticket to Work and Self-Sufficiency (TTW) 
program, our plans for achieving self-support (PASS) under the SSI 
program, and our Benefits Planning, Assistance, and Outreach (BPAO) 
program. Recognizing the importance of encouraging a return to work, 
the Act contains a number of other provisions that help us assist 
beneficiaries who would like to work, such as the provisions that allow 
us to provide expedited reinstatement of benefits, or continue benefit 
payments to certain individuals who recover medically while 
participating in an appropriate program of services. Despite these 
current work incentives, however, disability program beneficiaries 
still face significant barriers to work. These barriers may include:
     The adverse psychological impact of the lengthy disability 
determination process;
     The delays experienced when attempting to obtain needed 
health care, including the 24-month waiting period for Medicare 
benefits;
     Lack of access to the training, employment services, and 
other supports actually needed to obtain work;
     Strict SSI asset limits and strict disability insurance 
benefit offset rules; and
     The fear of work-related overpayments.
    At the same time that we presented the new approach in September 
2003, we outlined our Work Opportunity Initiative to foster voluntary 
return to work. This initiative responded to the President's third 
question (why would a disability program beneficiary risk returning to 
work after going through such a long process to receive benefits?). The 
initiative incorporates several demonstration projects designed to 
overcome the current barriers to work listed above and provides greater 
opportunities for disability beneficiaries and applicants who want to 
work.
    Within the Work Opportunity Initiative, we targeted three different 
demonstration programs to provide supports, incentives, and work 
opportunities to people with disabilities at the early stages of the 
disability determination process. The Early Intervention demonstration 
project would provide immediate medical and cash benefits and 
employment supports to disability insurance applicants with certain 
impairments presumed disabling who elect to pursue work rather than 
proceed through the disability determination process. An Accelerated 
Benefits demonstration project would provide immediate cash and medical 
benefits for a two-to three-year period to applicants who are highly 
likely to benefit from aggressive medical care and, as a result, return 
to work. The Interim Medical Benefits demonstration project would 
provide immediate health insurance coverage to applicants who otherwise 
would not have insurance but whose medical condition is likely to 
improve with medical treatment.
    Other demonstration projects within the initiative would provide 
ongoing employment supports and incentives to assist disability program 
beneficiaries obtain and sustain employment. A national benefit offset 
demonstration would test the effects of allowing disability insurance 
beneficiaries to work without total loss of benefits by reducing their 
monthly benefit one dollar for every two dollars of earnings above a 
specified level. Two different ongoing medical benefits demonstration 
projects would test the effects of providing ongoing health insurance 
coverage to disabled beneficiaries with (1) HIV/immune disorders and 
(2) mood and affective disorders who want to work, but who would 
otherwise lose access to affordable health insurance if they returned 
to work.
    We believe that these demonstration projects will help people with 
disabilities return to work, and that they will help remove barriers 
for those disability applicants and beneficiaries who can and want to 
work.

Ideas, Concerns, and Comments on the New Approach

    At the same time that we presented the new approach, we announced 
that

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we wanted to hear the views and suggestions of all interested parties, 
so that we could take them into account as we continued to refine the 
new approach and develop proposed rules to improve the disability 
process. We also established an Internet site in order to hear from all 
interested parties and consider a wide variety of perspectives as we 
continued to develop proposed rules. Since that time, we have met with 
hundreds of interested organizations, groups, and individuals to hear 
their views regarding the new approach, including:
     Members of Congress and congressional staff;
     Groups and organizations representing claimants, 
beneficiaries, retired individuals, and members of the public;
     Organizations representing legal and medical 
professionals, including Federal judges and administrative law judges; 
and
     Organizations representing SSA and State agency employees 
who are engaged in the disability determination process.
    A list of the groups and organizations with whom we met appears 
near the end of this preamble.
    These interested parties provided views, suggestions, and 
recommendations that we considered as we developed our proposal to 
create an improved disability process. We particularly appreciate the 
interest that members of Congress expressed regarding our desire to 
improve the disability determination process and are thankful for the 
suggestions that they have provided to us. We also received hundreds of 
e-mails from individuals currently receiving disability benefits, 
individuals currently applying for benefits, and other interested 
citizens providing recommendations on how to refine the process.
    In general, those commenting on the new approach were supportive. 
Most agreed that we need a disability process that is quicker and more 
responsive to the needs of disability applicants and beneficiaries. 
Some noted that the current disability determination process is too 
complicated and difficult to navigate. Others suggested that we should 
strive to achieve greater consistency in the determinations and 
decisions issued at different levels of review, as well as greater 
consistency in determinations and decisions issued throughout the 
country.
    We are deeply indebted to all of the individuals and organizations 
who expended substantial time and resources both to consider and 
analyze the current disability determination process and to share with 
us their views, suggestions, and recommendations about how to improve 
that process. Our ability to propose an effective and comprehensive 
strategy for improving the disability determination process was greatly 
enhanced by these views, suggestions, and recommendations.

Proposal To Improve the Disability Determination Process

    We believe that the changes we are proposing now will improve the 
overall disability determination process by shortening decision times, 
providing benefits and payments to people who are clearly disabled much 
earlier in the process, and improving quality, efficiency, adjudicatory 
consistency, and accountability throughout every step of that process. 
These changes will also help ensure that adjudicators have a complete 
administrative record when issuing the determination or decision and 
that there is proper documentation to support the determination or 
decision.
    In a further effort to improve our disability programs, we will 
establish a Disability Program Policy Council to provide a forum for 
policy issues to be discussed in a collaborative fashion and to make 
policy and procedural recommendations. Council members will include a 
mix of disability adjudicators at all levels of the process as well as 
representatives from the Office of the General Counsel, the Disability 
Review Board, program analysts, operations, including field office 
personnel, etc. The Deputy Commissioner of Disability and Income 
Support Programs will serve as chair of the Council. The Council will 
meet on a regular basis, and the Deputy Commissioner will routinely 
report on policy recommendations to the Commissioner. The Council will 
be a channel for experts to escalate disability policy and procedural 
issues.
    This proposed disability process is contingent on the eDib system. 
As with eDib rollout, we plan to roll out the proposed disability 
process carefully and gradually to ensure any problems can be 
corrected. We will start in one region and will expand to other regions 
over time. If the rollout goes well, we may accelerate the phased 
implementation of our new disability process.
    As a result of our proposed improvements to the disability 
determination process, we expect:
     Average disability determination processing time to be 
reduced by at least 25 percent;
     Decisional consistency and accuracy to increase;
     Quick Disability Determination units in State agencies to 
provide favorable determinations within 20 calendar days for 
beneficiaries who are clearly disabled; and
     Accountability for the quality of decision making and 
documentation of the record to be reinforced at every step of the 
process.
    We propose to apply these revised regulations when we administer 
claims for benefits and payments under title II and title XVI of the 
Act. Specifically, these improvements will:
     Establish a Quick Disability Determination process through 
which State agencies will expedite initial determinations for claimants 
who are clearly disabled;
     Create a Federal Expert Unit to augment and strengthen 
medical and vocational expertise for disability adjudicators at all 
levels of the disability determination process;
     Eliminate the State agency reconsideration step and 
terminate the disability prototype that we are currently conducting in 
10 States;
     Establish Federal reviewing officials to review State 
agency initial determinations upon the request of claimants;
     Preserve the right of claimants to request and be provided 
a de novo hearing, which will be conducted by an administrative law 
judge;
     Close the record after the administrative law judge issues 
a decision, but allow for the consideration of new and material 
evidence under certain limited circumstances;
     Gradually shift certain Appeals Council functions to a 
newly established Decision Review Board; and
     Strengthen in-line and end-of-line quality review 
mechanisms at the State agency, reviewing official, hearing, and 
Decision Review Board levels of the disability determination process.

Quick Disability Determinations

    We believe that many individuals who are obviously disabled wait 
too long to get Social Security disability benefits or SSI payments 
based on disability or blindness under our current disability 
determination process. Therefore, we propose to establish at the 
initial determination level a screening system for disability claims to 
identify those claims in which a wholly favorable decision may be made 
quickly. These claims will be processed in an expedited manner by State 
agencies and will be called Quick Disability Determination claims. 
State agencies will create special units

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comprised of experienced disability examiners whose sole focus will be 
the efficient, accurate, and timely adjudication of Quick Disability 
Determination claims.
    We initially believed that Quick Disability Determination claims 
should be adjudicated in regional units across the country, and not in 
the State agencies. However, many of the groups we met with and 
numerous individuals who submitted suggestions to us asserted that the 
State agencies could effectively adjudicate Quick Disability 
Determination claims. We have decided to propose that the State 
agencies be allowed to adjudicate these claims. We propose that a State 
agency adjudicating Quick Disability Determination claims must create a 
separate Quick Disability Determination unit that will be comprised of 
experienced examiners who will work exclusively on these claims and 
complete adjudication of these claims within the timeframes we have 
established.
    We expect that the range of claims that will qualify to be 
adjudicated as Quick Disability Determination claims will be relatively 
small when we first begin implementing the proposed changes. However, 
as we gain experience with the Quick Disability Determination process 
and as we improve and fine-tune our case-selection tools, we expect 
that the range of potential Quick Disability Determination claims will 
increase over time.
    We will make use of a predictive model screening software tool that 
will identify claims that indicate a high degree of probability that an 
individual both meets our definition of disability and has readily 
available medical evidence. This software will utilize data from the 
initial disability application and provide an alert to the State agency 
that the disability claim meets the criteria to be adjudicated as a 
Quick Disability Determination claim.
    In these proposed regulations we require that the State agencies 
comply with timeliness standards for processing Quick Disability 
Determination claims in order to maintain their Quick Disability 
Determination adjudication responsibilities. We propose that the Quick 
Disability Determination units will provide favorable determinations of 
disability in 20 days or less to disability applicants who are clearly 
disabled and who meet our disability criteria. The Quick Disability 
Determination units will not make unfavorable determinations when 
processing potential Quick Disability Determination cases. Our proposed 
rules provide that if a favorable quick disability determination cannot 
be made within 20 days (either because the particular Quick Disability 
Determination criteria have not been met in the case or because the 
case involves impairments that require more than 20 days to properly 
evaluate), the case will be adjudicated by the State agency in the 
normal manner using our existing procedures.
    Our proposed rules also provide that the State agency Quick 
Disability Determination units must ensure that a medical or 
psychological expert who has the qualifications required by the 
Commissioner verifies the particular diagnosis that is the basis of the 
claim in each case.
    Our proposed rules explain that we will monitor the performance of 
the Quick Disability Determination units to ensure that these claims 
are being processed in a timely manner. We propose to establish special 
processing standards that the Quick Disability Determination units must 
meet in order to perform this important workload. Although these 
proposed rules do not change our existing rules regarding State agency 
responsibilities for performing the disability determination function, 
we intend to modify those rules, currently promulgated in subpart Q of 
part 404 and subpart J of part 416, in the future.

State Agency Determinations

    We also propose to require the State agency to document and explain 
the basis for the determination made in every claim it adjudicates. We 
believe that more complete documentation and explanation of the basis 
for the determination will result in more accurate initial 
determinations and will assist adjudicators in claims that are reviewed 
by a Federal reviewing official or considered by an administrative law 
judge.

Medical and Vocational Expertise and the Federal Expert Unit

    Making correct disability determinations and decisions in a 
consistent and timely manner is critically important to disability 
claimants, as well as to the general public. Ultimately, whether 
someone is disabled within the meaning of the Act is a legal question 
that often requires consideration of complicated medical and vocational 
evidence. In crafting the new approach, we realized from the beginning 
that having sufficient expertise to help us consider the medical and 
vocational issues in claims filed throughout the country would be 
essential to an efficient, accurate, and fair adjudication process. 
However, we realized that under our current disability adjudication 
process, medical, psychological, and vocational experts are not 
consistently available to all adjudicators at every level or in all 
parts of the country.
    We are therefore proposing to establish and operate a Federal 
Expert Unit, which we believe will help to ensure the full development 
of the record, enable adjudicators to make accurate determinations or 
decisions as early in the process as possible, and facilitate 
subsequent review should a case be appealed to a higher level. We 
propose to create a national network of medical, psychological, and 
vocational experts who will be available to assist adjudicators 
throughout the country. This national network may include experts 
employed by or under contract with the State agencies; however, all 
experts affiliated with the national network must meet qualifications 
prescribed by the Commissioner.
    The Federal Expert Unit will organize and maintain this network 
comprised of medical, psychological, and vocational experts who will 
provide medical, psychological, and vocational expertise to State 
agencies, reviewing officials, administrative law judges, and the 
Decision Review Board. We want to ensure that the right set of medical 
eyes reviews medical records and answers questions about the wide 
variety of impairments seen in disability claims. We believe that the 
expert network affiliated with the Federal Expert Unit will help ensure 
that a medical, psychological, and vocational expert who has the 
qualifications required by the Commissioner assists in adjudicating 
disability claims. With the assistance of the Institute of Medicine, we 
plan to develop standards that define the medical and psychological 
expertise necessary for experts to qualify for participation in the 
national network.
    We will also establish standards with respect to the qualifications 
of vocational experts employed by the State agencies and affiliated 
with the Federal Expert Unit because we are committed to employing 
consistent, high quality vocational expertise in the disability 
determination process. To that end, we plan to undertake a study to 
enhance the expertise needed to make decisions on a claimant's 
functional limitations and his/her ability to perform jobs available in 
the national economy. Among other things, the study will help determine 
(1) how best to provide vocational and occupational medical expertise 
at all levels of the disability determination process to improve the 
quality of case adjudication

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and (2) what qualifications vocational and occupational medical experts 
should have.
    Several organizations and numerous individuals urged us to allow 
the State agencies to continue to use State agency medical consultants 
when making initial disability determinations under the new approach. 
While we agree that the State agencies should continue to employ 
medical and psychological consultants, we believe that it is essential 
that every medical and psychological expert meet our qualification 
standards in order to participate in the disability adjudication 
process.
    Therefore, experts who are affiliated with the Federal Expert Unit 
and experts who are under contract with a State agency must meet these 
qualification standards on the effective date of these regulations or 
when we publish the qualifications, whichever is later. We expect to 
publish expert qualification standards on or before issuing a final 
rule, but will publish them no later than six months after the 
effective date of this final rule. Experts who are employed by a State 
agency must meet them no later than one year after the effective date 
of these regulations or no later than one year after the date we 
publish the qualifications, whichever is later. Our proposed 
regulations also provide that we will not reimburse State agencies for 
the costs associated with work performed on our behalf by experts 
employed by, or under contract with, the State agencies who do not meet 
our qualification standards. However, we intend to implement this 
reimbursement provision on a region-by-region basis as we implement our 
new approach. Therefore, our reimbursement policy will be applied only 
to State agencies where we have implemented these proposed regulations.
    We further propose that in those instances where an administrative 
law judge requires medical, psychological, or vocational testimony in 
order to hear a case or make a decision, the administrative law judge 
must use a medical or vocational expert from the network. However, in 
order to ensure the independence of the administrative law judge 
process, if the State agency or the reviewing official has used an 
expert from the network and the administrative law judge needs an 
expert in the case as well, the administrative law judge must use a 
different expert.
    When requested by an administrative law judge or the Decision 
Review Board, appropriate medical, psychological, and vocational 
expertise will be made available by the Federal Expert Unit from the 
national network on a rotational basis, taking into account the 
decision maker's potential need to have an expert who is physically 
located nearby. We propose to pay these medical, psychological, and 
vocational experts at rates that we will establish.

Reviewing Official

    Several of the interested organizations and individuals who 
contacted us expressed the view that, under the current disability 
determination process, there are inconsistencies in initial 
determinations made by State agencies which are not being corrected at 
the State agency reconsideration step. Some of these interested parties 
also expressed the belief that the reconsideration step was merely a 
``rubber stamp'' of the initial State agency determination. We believe 
that the remarkably high percentage of claimants who pursue further 
review of their determinations perceive the reconsideration step as a 
burdensome step in the process which adds no appreciable value to the 
process.
    Under our proposed rules, if a claimant is dissatisfied with the 
determination made by the State agency, the claimant may appeal the 
determination to a Federal reviewing official, who will conduct a 
review of the claim. The reviewing official will review the 
administrative record and issue a decision in your case or return your 
case to the State agency. The reviewing official will not conduct a 
hearing or meet with you in person.
    We received a considerable number of comments from interested 
parties regarding whether or not the reviewing official should be an 
attorney. Some interested parties stated that the effective performance 
of reviewing official duties required certain legal and analytical 
skills that only licensed attorneys possess. In addition, some argued 
that the reviewing official's decision would have greater credibility 
if it were made by an attorney. However, others argued that the 
responsibilities of the reviewing official could be met by a non-
attorney with experience making disability determinations.
    We believe that attorneys are ideally suited to perform certain 
critical reviewing official functions such as garnering the requisite 
evidence to compile a complete case record and drafting a well-
supported, legally-sound decision. We believe that attorneys will be 
able to effectively adjudicate claims in a manner that ensures that the 
right decision is made early in the administrative review process. We 
also believe that using attorneys as reviewing officials will help 
improve the level of confidence that applicants, members of the pubic, 
administrative law judges, and other interested parties have regarding 
the integrity of our first level of administrative review. For these 
reasons, we plan to hire attorneys to serve as Federal reviewing 
officials.
    Under our proposed rules, the reviewing official may reverse, 
remand, modify, or affirm your initial determination. The reviewing 
official's action on your claim will be made only on the basis of a 
review of the record; you will not have any right to a hearing before 
the reviewing official. We propose that if additional evidence is 
necessary, the reviewing official may obtain such evidence from other 
sources, including ordering a consultative examination with the 
assistance of the Federal Expert Unit. In addition, if additional 
evidence is necessary, we propose that a reviewing official may remand 
a claim back to the State agency so that the State agency can 
readjudicate the claim. The reviewing official may also, while 
retaining jurisdiction of the claim, return the claim to the State 
agency so that it can obtain the additional evidence.
    Under our proposed rules, if the reviewing official disagrees with 
the State agency's determination that you did not meet our definition 
of disability, the reviewing official must have a qualified medical or 
psychological expert affiliated with the Federal Expert Unit evaluate 
the evidence to determine the medical severity of the impairment before 
the reviewing official can issue his or her decision. In addition, if 
there is new and material evidence that the State agency did not 
consider, the reviewing official must make a decision in consultation 
with a medical or psychological expert affiliated with the Federal 
Expert Unit.
    We propose to require that the reviewing official issue a written 
decision in every case that he or she adjudicates. The reviewing 
official will explain in this decision why he or she agrees or 
disagrees with the State agency's determination that you did not meet 
our definition of disability. The reviewing official's decision will be 
sent to the State agency and used by us for quality management 
purposes.
    A major objective of using Federal reviewing officials to review 
disability claims is to ensure to the maximum extent possible the 
accuracy and consistency--and thus the fairness--of determinations made 
at the front end of the process. We intend to provide careful 
administration of the reviewing official function. We plan to employ 
highly qualified individuals who will be thoroughly trained in the 
policies and

[[Page 43596]]

procedures of our disability determination process.

Administrative Law Judge Hearings and Decisions

    We are proposing some changes to the hearing level process as part 
of our overall effort to improve disability decision making. Under 
these proposed rules, administrative law judges will continue to hold 
de novo hearings and issue decisions based on all the evidence 
presented. They will not be required to give any legal deference or 
particular weight to the determinations previously made by the State 
agency or by the reviewing official.
    Under the new process, the administrative law judge's hearing 
decision will generally become our final decision, and you will no 
longer be able to request that the Appeals Council review the decision. 
Recognizing the importance of this change, and consistent with our goal 
to improve all aspects of the administrative review process, we are 
proposing to make some changes to the hearing process that we expect 
will improve the timeliness of the process and the quality of the 
administrative law judge's decision.
    For example, we propose to improve the timeliness of the hearing 
process by revising the rules that address the time frames for 
submitting evidence to us. Our current rules state that, if possible, 
you should submit the evidence, or a summary of the evidence, that you 
wish to have considered at the hearing to the administrative law judge 
with the request for a hearing or within 10 days after filing the 
request for a hearing. In many cases, however, claimants submit 
evidence to us well after that time frame.
    Our program experience, as well as our discussions with interested 
parties, has convinced us that the late submission of evidence to the 
administrative law judge significantly impedes our ability to issue 
hearing decisions in a timelier manner. When new and voluminous medical 
evidence is presented either at the hearing, or shortly before the 
hearing, the administrative law judge needs time to review and consider 
that evidence. The late submission of evidence reduces the efficiency 
of the hearing process because we often must reschedule hearings to 
give the administrative law judge an opportunity to perform that 
review. Rescheduling hearings not only delays decisions on individual 
claims, but also delays the hearings of other claimants for benefits.
    To manage our hearing process more effectively, we propose time 
limits for submitting evidence to the administrative law judge as well 
as consequences for failing to abide by the time limits. The lack of 
any consequences for violating the time limits is a major shortcoming 
of our current rules. We propose, as described in more detail below, 
that generally, you must submit evidence 20 days before the hearing. 
Nevertheless, recognizing that there may be situations where it is 
impossible to comply with the time limits for submitting evidence, we 
propose specific exceptions to them.
    Another proposed change that we anticipate will improve the 
timeliness of our hearing process is that within 90 days of the date we 
receive your hearing request, the administrative law judge will set the 
time and place for the hearing. Our current rules do not provide any 
date by which the administrative law judge should schedule a hearing. 
This proposed 90-day time frame represents a management goal for us and 
does not provide you with a substantive right to have a hearing 
scheduled within this period. Given the size and magnitude of our 
hearing process, it simply would not be administratively feasible for 
us to hold a hearing within 90 days for every claimant who filed a 
hearing request. Indeed, it would not be appropriate for us to do so, 
because some claims will inevitably require more development than 
others. Nevertheless, by including this provision in the rules, we are 
stressing to our adjudicators our commitment to providing timely 
service. We also propose that the administrative law judge must notify 
you of your hearing date at least 45 days before the date of the 
scheduled hearing, unless you agree that the administrative law judge 
may provide you with less notice.
    One of our major goals in proposing these rules is to improve the 
quality and consistency of decision making at all levels of our 
administrative review process. As noted above, one of the new features 
of the administrative review process is the use of a Federal reviewing 
official who (after the filing of a request for review) will review the 
State agency's initial determination and make a decision on your 
disability claim. As we noted earlier in the preamble, we expect that 
the use of Federal reviewing officials will help improve the quality of 
determinations by State agencies, because the reviewing official will 
explain why he or she agrees or disagrees with the State agency's 
determination. We propose to include a similar rule at the 
administrative law judge hearing level. Under the proposed rules, an 
administrative law judge will provide in his or her decision an 
explanation for why he or she agrees or disagrees with the reviewing 
official's rationale in the written decision. We expect that the 
administrative law judge's explanation will provide information for the 
reviewing official and for management and that this type of feedback 
from administrative law judges to reviewing officials and from 
reviewing officials to the State agencies will be important to 
accomplishing our goal of improving the quality of the decision making 
process.
    We propose that the administrative law judge decision in your 
disability claim will become our final decision, unless we select your 
disability claim for review by a new administrative body we propose to 
create called the Decision Review Board. We explain the purpose and 
functions of the Decision Review Board below. If your claim is not sent 
to the Decision Review Board for review, the administrative law judge's 
decision will stand as the final Agency decision, and you may seek 
review of the administrative law judge's decision in Federal district 
court.

Closing the Record

    We received many comments from interested parties about closing the 
record. Some interested parties argued that the record should not be 
closed after the issuance of the administrative law judge decision. 
These parties believed that claimants should have the right to submit 
additional evidence at any time. Some stated that if we decided to 
close the record after the issuance of the administrative law judge 
decision, we should provide for a good cause exception that would allow 
the submission of new evidence in certain circumstances. Other 
interested parties argued that the record should firmly close after the 
issuance of the administrative law judge decision, believing that this 
would encourage more efficient collection of evidence and more timely 
and efficient processing of claims.
    Every reasonable effort should be made to submit evidence as early 
in the adjudicative process as possible. We are proposing to close the 
record after the administrative law judge issues a decision on your 
claim. A consistent policy of closing the record after the issuance of 
the administrative law judge decision will promote administrative 
efficiency and timely claims processing. However, we agree that there 
are certain limited circumstances where a claimant may have good 
reasons for failing to provide evidence in a timely manner to the 
administrative law judge. Consequently, we propose to close the record 
after the administrative law judge

[[Page 43597]]

issues a decision in a case, but to allow the consideration of new and 
material evidence under certain limited circumstances.
    We propose that you must submit all of the evidence you will rely 
upon in your case to the administrative law judge no later than 20 days 
before the hearing. This time limit should be easily met because we 
also are proposing that the administrative law judge must notify you of 
your hearing date at least 45 days before the hearing.
    The 20-day time limit for submitting evidence is subject to only 
two exceptions, both of which must be raised at the hearing. If you are 
aware of any additional evidence that you could not timely obtain and 
submit or if you are scheduled to undergo additional medical evaluation 
after the hearing for any impairment that forms the basis of your 
disability claim, you must inform the administrative law judge of 
either of these circumstances during your hearing. If you request 
additional time to submit the evidence, the administrative law judge 
may exercise his or her discretion and choose to keep the record open 
for a defined period of time to give you the opportunity to obtain and 
submit the additional evidence. If the extension is granted, once he or 
she receives this additional evidence, the administrative law judge 
will close the record and issue a decision.
    After the record is closed, we will not consider additional 
evidence unless you establish good cause for failing to submit the 
evidence during the extended time period that the administrative law 
judge granted to you. In these situations, you must have informed the 
administrative law judge during the hearing that you were attempting to 
obtain this evidence or that you anticipated receiving such evidence 
after the hearing. You must submit your evidence and provide your good 
cause explanation to the administration law judge within 10 days of 
receiving the administrative law judge's decision. However, if your 
case has been selected for review by the Decision Review Board, you 
will be notified that the administrative law judge's decision is not 
our final administrative decision, and you must submit your additional 
evidence and provide your explanation of good cause to the Decision 
Review Board within 10 days of receiving the administrative law judge's 
decision.
    We will find good cause only when you were prevented from obtaining 
or presenting your evidence during the extended time period due to 
unusual and unavoidable circumstances beyond your control. For example, 
if an administrative law judge grants you an extended time period to 
submit a doctor's report and you receive the report during the extended 
period, but could not provide it to the administrative law judge 
because you were hospitalized, we may find that you had good cause for 
failing to submit the evidence. However, we will not find good cause in 
instances where your additional medical evidence is obtained during the 
extended period but your representative fails to submit it in a timely 
manner as we hold you accountable for the actions of your 
representative pertaining to the submission of evidence. Although we 
will not consider the additional evidence in such cases, you will 
continue to have the right to file a new application for disability 
benefits for the time period beginning on the date after the 
administrative law judge's decision in your case.
    Finally, in very limited situations, we may consider evidence after 
the record is closed and when you did not inform the administrative law 
judge at the hearing that additional evidence may exist. We are aware 
that there may be instances when a claimant attends a hearing and 
complies with all of our proposed rules regarding submission of 
evidence, but then experiences a significant worsening of condition or 
experiences the onset of a new impairment after the hearing, but before 
the decision is issued. In such circumstances, material evidence 
regarding a worsening or an onset of a new impairment may become 
available that the claimant could not have been expected to identify or 
discuss during the hearing. Since the period being reviewed by an 
administrative law judge includes the period of time between the date 
of the hearing and the date that the administrative law judge issues a 
decision, we believe that material evidence regarding your condition 
during this period should be considered.
    Therefore, if you obtain new evidence after your hearing that shows 
your impairment(s) or condition changed materially during the period 
after the hearing and before the issuance of the administrative law 
judge's decision, you must submit this evidence to us as soon as 
possible, but no later than 10 days after the date of you receive the 
administrative law judge's decision in your case.
    If you have not yet received your administrative law judge 
decision, you should submit this evidence to the administrative law 
judge, who will review the evidence and, if it is material to your 
claim, consider it when deciding your claim.
    If the administrative law judge has already issued your decision 
and your case has not been selected for review by the Decision Review 
Board, you must submit this evidence to the administrative law judge no 
later than 10 days after the date you receive notice of the decision 
and request that the administrative law judge reconsider his or her 
decision. Upon your timely request, the administrative law judge will 
review and consider the evidence as appropriate. The administrative law 
judge may reconsider the decision on your claim and revise it based on 
the new evidence if warranted or vacate your decision and order a new 
hearing if warranted. However, if you submit this evidence more than 10 
days after the date you receive notice of the decision, the 
administrative law judge will not consider the new evidence.
    If the administrative law judge has already issued your decision 
and your case has been selected for review by the Decision Review 
Board, you must submit this evidence to the Decision Review Board (not 
to the administrative law judge) within 10 days after the date you 
receive notice of the administrative law judge's decision. The Decision 
Review Board will review and consider the evidence as appropriate.

Decision Review Board

    The question of whether or not to eliminate the Appeals Council 
generated a considerable number of comments from a wide variety of 
interested parties. Some interested parties argued that the Appeals 
Council should be retained because it identifies erroneous 
administrative law judge decisions and provides recourse in a 
significant number of instances. They argued that, as a result, the 
elimination of the Appeals Council would result in an unacceptable 
increase in the number of cases filed in Federal district court, 
particularly those problematic or erroneous cases that are currently 
identified and resolved by the Appeals Council. Interested parties also 
observed that elimination of the Appeals Council would effectively 
prevent any review of dismissals made by administrative law judges 
because claimants would have no right to file for Federal district 
court review.
    On the other hand, many other interested parties expressed the 
belief that the Appeals Council should be eliminated, arguing that the 
Appeals Council does not effectively identify and address erroneous 
administrative law judge decisions. These and other interested parties 
further expressed the

[[Page 43598]]

view that the delays associated with Appeals Council review outweighed 
any benefits provided by this level of review. Others believed that the 
impact of our eliminating the Appeals Council would be ameliorated to a 
significant degree because the new approach already contemplated the 
ability of claimants to receive two separate levels of Federal 
administrative review after the initial State agency determination--the 
Federal reviewing official level and the administrative law judge 
level.
    While we agree that the Appeals Council has identified erroneous 
administrative law judge decisions and provides recourse in some 
instances, we believe that the current Appeals Council review process 
adds substantial processing time to the disability adjudication process 
without intercepting large numbers of claims that do not withstand 
Federal district court review. The district courts are currently 
remanding more than 50 percent of the disability cases filed against 
us.
    We believe that the important and critical functions pertaining to 
the review of disability claims currently performed by the Appeals 
Council can be performed more effectively by a smaller review body that 
will focus on promptly identifying decision making errors and 
identifying policies and procedures that will improve decision making 
at all levels of the disability determination process. We propose to 
establish a new Decision Review Board to perform these functions.
    The Decision Review Board will be an administrative review body 
comprised of experienced adjudicators who can advance the objective of 
ensuring fair, consistent, and efficient decision making. The members 
of the Decision Review Board will be appointed by the Commissioner and 
will consist of administrative law judges and administrative appeals 
judges. Decision Review Board members will have staggered terms and 
serve on a rotational basis. The Decision Review Board will select and 
review both favorable and unfavorable administrative law judge 
decisions that are likely to be error-prone, and it will generally 
select and review an equal share of each type of case.
    Under our proposal, you will no longer have the right to request 
administrative review of a disability decision issued by an 
administrative law judge. However, you will have the right to request 
review by the Decision Review Board of the dismissal of your request 
for hearing, an action that is not subject to Federal court review. In 
addition, you will continue to have the right to seek further 
administrative review of any administrative law judge decision 
pertaining to your nondisability case. These cases will continue to be 
reviewed by the Appeals Council while we implement our proposed rules. 
Once our proposed rules are fully implemented nationwide, this review 
function will be transferred to the Decision Review Board.
    We anticipate that the Decision Review Board will review a wide 
range of decisions and identify decision-making errors, provide advice 
regarding the nature and magnitude of these errors, identify policies 
and procedures that could be used to address such errors, and develop 
information mechanisms aimed at improving decision making at all levels 
of the disability determination process. The Decision Review Board will 
have the authority to affirm, reverse, or remand an administrative law 
judge's decision. The wide range of decisions that the Decision Review 
Board will review include:
     Cases that are likely to be the subject of requests for 
voluntary remand or judicial remand;
     Allowance and denial cases where error is likely, 
including cases that involve the interpretation of new policy or 
procedural issuances; and
     A selection of decisions that are issued after remand by 
the Decision Review Board or a Federal district court.
    We intend to screen every administrative law judge decision, using 
computer-based predictive screening tools and individual case record 
examination performed by skilled reviewers, to identify cases for 
Decision Review Board review. The Decision Review Board will select 
cases for review based, in part, on its identification of problematic 
policies or on its own experience with processing cases that have been 
identified as error-prone by our Office of the General Counsel or by 
the Federal courts.
    The Decision Review Board will monitor administrative law judge and 
district court decisions in order to identify trends or developments 
relating to the quality and accuracy of administrative law judge 
decisions throughout the country. We will conduct an ongoing review of 
administrative law judge decisions that are either the subject of 
requests for voluntary remand or are remanded to us by the Federal 
district courts. The results of our review will help us to develop a 
profile of decisions that have a high likelihood of resulting in 
errors. The Decision Review Board will focus its review on these 
decisions. Cases will not be selected for review by the Decision Review 
Board based on the identity of the administrative law judge who issued 
the decision or on the particular outcome of the decision.
    We propose that once the Decision Review Board has assumed 
jurisdiction of a case, it may, among other things:
     Affirm the administrative law judge disposition;
     Reverse the administrative law judge disposition and issue 
a new final decision;
     Modify the administrative law judge disposition and issue 
a new final decision; or
     When there is insufficient evidence to support a decision 
or where an improper dismissal has occurred, remand a case to an 
administrative law judge with instructions to take further action.
    The Decision Review Board will have authority to take any of these 
actions consistent with the instructions of a Federal court when the 
court has remanded a case for further administrative proceedings.
    If your case is selected for Decision Review Board review, we will 
notify you when you receive your administrative law judge decision that 
the Decision Review Board is reviewing your case and that the 
administrative law judge decision you received is not our final 
administrative decision. The Decision Review Board will review the 
administrative law judge decision and consider the record that was 
closed at the time that the administrative law judge issued the 
decision (subject to the exception described above when there is good 
cause for failure to submit evidence timely). We propose that the 
Decision Review Board must complete its review of your case within 90 
days from the date that you receive the administrative law judge's 
decision. If the Decision Review Board issues a decision within the 90-
day period, it becomes our final decision, and you will have the right 
to seek Federal district court review of that final decision. If the 
Decision Review Board does not issue a decision by the end of the 90-
day period, the administrative law judge's decision will become our 
final decision in your case, and you will have the right to seek 
Federal district court review of that final decision.
    If the administrative law judge's decision becomes the final Agency 
decision because the Decision Review Board did not act within 90 days, 
but the Decision Review Board subsequently determines that it can make 
a decision that is fully favorable to you, it will reopen the 
administrative law judge's decision and revise it as appropriate. If 
you have already sought

[[Page 43599]]

judicial review of the final decision, the Decision Review Board will 
notify the Office of the General Counsel, which will take appropriate 
action with the Department of Justice in order to request that the 
court remand the case for the purpose of issuing the Decision Review 
Board's favorable decision.
    The Decision Review Board will meet on a regular basis as a body to 
discuss decisional trends and procedural issues and to prepare advisory 
materials for appropriate Agency officials. It will be headed by a 
director who will also serve as a member of our Disability Program 
Policy Council, which we will create to assess and to make improvements 
in the overall disability determination process by assessing and 
improving our disability policy.

The Proposed Disability Determination Process

    Thus, under these proposed rules, the adjudication of a disability 
claim will proceed in the following manner:
    The State agency will issue an initial determination on your claim. 
If your claim meets certain criteria, it will be processed by the State 
agency as a Quick Disability Determination claim. If you are 
dissatisfied with the initial determination made by the State agency, 
you may request review by a reviewing official. If you are dissatisfied 
with the reviewing official's decision, you may request a hearing 
before an administrative law judge. If the administrative law judge 
issues our final decision and you are dissatisfied with the final 
decision, you may file a civil action in Federal district court.
    However, if the administrative law judge reaches a decision in your 
case but your case has been selected for review by the Decision Review 
Board, the administrative law judge's decision will not be considered 
our final decision in your case. Instead, the Decision Review Board 
will have 90 days to review the ALJ's decision in your case. You may 
not file a civil action in Federal district court until either the 
Decision Review Board issues our final decision within 90 days of the 
date you receive the administrative law judge's decision, or the 90-day 
period lapses without the Decision Review Board taking action on your 
case. If the 90-day period lapses, the administrative law judge's 
decision will constitute our final decision in your case. As discussed 
above, if you have already sought judicial review of the final decision 
and the Decision Review Board decides it will issue a favorable 
decision, it will ensure that appropriate action is taken to remand the 
case for the purpose of issuing that decision.
    You will have the right to request administrative review of an 
administrative law judge's dismissal of your request for hearing.
    Unless specified, all other regulations relating to the disability 
determination process and the administrative review process remain 
unchanged.
    When we make a determination or decision on your claim for 
benefits, we will apply a preponderance of the evidence standard, 
except that the Decision Review Board will review findings of fact 
under the substantial evidence review standard.
    In addition to these proposed changes, we intend to take additional 
steps to improve decisional quality, promote consistency of decision 
making, and increase accountability for all decision makers. We intend 
to create standardized decision writing formats to provide a framework 
for the proper and consistent articulation of determinations and 
decisions by the adjudicators at the State agency, reviewing official, 
and administrative law judge levels. We will create standardized 
decision writing formats that are appropriate for each level of 
adjudication. We believe that these formats will help decision makers 
at every adjudicatory level explain to the claimant the basis of the 
determination or decision being made in each case, and will ensure that 
our determinations and decisions contain sufficient rationale for those 
cases that are subsequently reviewed at another administrative level or 
in the Federal courts. We also intend to establish procedures to enable 
decision makers at all levels in the process to receive constructive 
information regarding their decisions or determinations from subsequent 
administrative adjudicators or reviewers.

How the Proposed Changes Will Be Implemented

    We intend to implement our proposed changes gradually, region by 
region. We expect to begin the implementation process in one of our 
smaller regions, expanding to additional regions as we gain experience. 
We believe that this will enable us to carefully monitor the 
implementation process and to quickly address any potential problems 
that may arise.
    Thus, if our regulations for the new approach as proposed in the 
new part 405 are adopted as final regulations, they will apply only in 
a region where this new approach has been implemented and will apply 
only to claims that are filed in that region. If a claim is filed in a 
region where we have not yet implemented the new approach, we will use 
our current rules and regulations to adjudicate that claim.
    We are considering alternative rollout procedures for the quick 
determination process. We therefore invite comments on whether, and 
under what circumstances, we should use such an alternative procedure, 
and if so, what such an alternative procedure might be.
    We also intend to implement our new qualification standards for 
medical, psychological, and vocational experts as quickly as possible. 
We expect to publish expert qualification standards on or before 
issuing a final rule, but we will publish them no later than six months 
after the effective date of this final rule. Experts who are affiliated 
with the Federal Expert Unit and experts who are under contract with a 
State agency must meet these qualification standards on the effective 
date of these regulations or when we publish the qualifications, 
whichever is later. Experts who are employed by a State agency must 
meet them no later than one year after the effective date of these 
regulations or no later than one year after the date we publish the 
qualifications, whichever is later.
    Our proposed regulations also provide that we will only reimburse 
State agencies for the costs associated with work performed on our 
behalf if the experts employed by, or under contract with, the State 
agencies meet our qualification standards. However, we intend to 
implement this reimbursement provision on a region by region basis as 
we implement our new approach. Therefore, we will only reimburse State 
agencies for costs associated with work performed by a State agency 
expert who meets our qualification standards if the work was performed 
in a region where we have implemented our new approach.
    We are aware of the concerns of some of the interested parties 
about the possible effects of the elimination of the Appeals Council 
and the right to appeal disability decisions. Under our implementation 
plan, we propose to eliminate the right of claimants to appeal 
disability decisions to the Appeals Council only with respect to claims 
that have been adjudicated in those States where our proposed changes 
have been implemented. If your claim has not gone through the new 
process, you will retain the right to appeal according to our current 
rules. However, if your claim has gone through the new process, 
including review by a reviewing official, you will not be allowed to 
seek administrative review of the administrative law judge decision. We 
will closely monitor the effects that these changes are having as

[[Page 43600]]

we implement our new approach. If we determine that our proposed 
changes adversely affect the disability determination process or the 
Federal courts over time, we will amend our regulations as necessary.
    Responsibilities of the Appeals Council will be shifted to the 
Decision Review Board on a gradual basis as we implement our new 
approach region by region so that we can closely monitor the effect 
that our proposed changes are having on the rate of new disability 
cases being filed in Federal court. As noted above, we expect to begin 
implementation in one of our smaller regions, which will allow the 
Decision Review Board to review a significant percentage of cases. In 
addition, we will select the region that has had the least number of 
court cases filed each year in the current process. This should allow 
us to monitor what effects the elimination of the Appeals Council, 
combined with reviews by the new Decision Review Board, has on the 
number of suits filed in the Federal courts in this region. We believe 
that the Decision Review Board's ability to accurately select for 
review those administrative law judge decisions most likely to be 
error-prone will improve as it gains greater experience. The Decision 
Review Board will monitor administrative law judge and district court 
decisions in order to identify trends or developments that we need to 
address. If we determine that our proposed changes are causing a 
significant increase in Federal disability case filings, we will make 
changes to the process as necessary.
    Throughout the implementation process, we will meet regularly with 
organizations representing the interests of various perspectives in the 
disability process, including claimant representatives and advocates, 
State agency directors and employees, administrative law judges, and 
members of the judiciary. Through these discussions, we will continue, 
and further expand, the dialogue begun when the new approach was first 
introduced. The meetings will provide an opportunity to discuss and 
better understand the impact of these changes as they are rolled out.

Judicial Review

    We propose that when a Federal court remands a disability case to 
us for further consideration, the Decision Review Board may make a 
decision based upon the evidence in the record, or it may remand the 
case to an administrative law judge. If the Decision Review Board 
remands a case to an administrative law judge, it will send the 
claimant a notice.

Ensuring Quality

    To ensure improved quality and accountability throughout the 
disability determination process, we intend to create and operate a 
comprehensive and multidimensional approach to quality assurance that:
     Includes both in-line and end-of-line quality assurance 
programs at every step of the process;
     Includes all components contributing to the disability 
decision;
     Continues the mandated pre-effectuation review at the 
initial claims level and provides that Quick Disability Determination 
claims and reviewing official decisions will be subject to pre-
effectuation review;
     Replaces the current Disability Quality Branch review of 
State agency claims with a new centrally-managed quality assurance 
system that will perform independent end-of-line reviews of targeted 
cases and a random sample of all cases, and provide for an in-line 
quality process performed by the State agencies;
     Is consistently applied across all States and regions by 
implementing uniform program and reporting standards for component-
administered in-line and end-of-line quality assurance programs, and 
encourages local flexibility and initiative in supplementing 
standardized local quality assurance programs;
     Focuses on building quality into the determination process 
by emphasizing ongoing excellence and prospective improvement, and not 
just retroactive error detection and correction;
     Institutionalizes continuous improvement principles in 
order to develop ongoing process and policy enhancements;
     Reemphasizes management responsibilities and 
accountability for ongoing quality measurement, analysis, improvement, 
and mentoring;
     Focuses on the human capital element by contributing to 
the development of formal position competencies and training programs, 
including continuing education;
     Requires decision rationales to be articulated at all 
levels of adjudication;
     Requires that the various review levels of the disability 
determination process address determinations or decisions made at the 
prior level;
     Collects and aggregates claim and quality information for 
all levels and all components in a standardized fashion, thus providing 
comparable quality data for the life of a claim through all 
adjudicative levels;
     Uses quality information to provide ongoing information 
for both individual and process improvement purposes; and
     Considers service, timeliness, productivity, and cost as 
components of quality along with accuracy.
    In addition, we envision that the Decision Review Board will be 
actively involved in the activities of our Disability Program Policy 
Council. In this capacity, the Decision Review Board will be able to 
raise issues and concerns that might warrant efforts to improve 
existing policy.

Adjudicator Training

    We also intend to clarify our authority to require all individuals 
who are part of the adjudicatory process to participate in training 
programs that we establish. This includes DDS examiners and support 
staff, reviewing officials and support staff, administrative law judges 
and hearing office support staff, Decision Review Board members and 
support staff, and medical, psychological, vocational, and other 
consultants and experts used at every stage of the disability 
determination process.

When Will We Start To Use These Rules?

    We will not use these rules until we evaluate the public comments 
we receive on them, determine whether to issue them as final rules, and 
issue final rules in the Federal Register. If we publish final rules, 
we will explain in the preamble how we will apply them, and summarize 
and respond to the public comments. Until the effective date of any 
final rules, we will continue to use our current rules.

How Long Would These Proposed Rules Be Effective?

    If we publish these proposed rules as final rules, they will remain 
in effect unless we revise and issue them again.

Explanation of Changes

    We are creating a new part 405 to explain our new procedures for 
determining entitlement to benefits based on disability under title II 
of the Act, and eligibility for supplemental security income payments 
based on disability or blindness under title XVI of the Act. We propose 
that part 405 will consist of ten subparts.

General Description and Definitions

    The rules in subpart A briefly explain the purpose of the proposed 
rules and provide a short description of our proposed new 
administrative review process. We make clear in this subpart that our 
administrative review process

[[Page 43601]]

will continue to be conducted in a non-adversarial manner, and that we 
will continue to consider any evidence presented to us during this 
process, subject to certain limitations on evidence that is provided 
after an administrative law judge has issued a decision in your case. 
We also provide a list of definitions that apply to all of part 405.

Federal Expert Unit

    We intend to enhance our medical, psychological, and vocational 
expert resources by establishing a Federal Expert Unit to support our 
disability determination procedures at every step of the process. We 
explain in subpart A that the Federal Expert Unit will manage a 
national network of medical, psychological, and vocational experts who 
will assist State agencies, reviewing officials, and administrative law 
judges in making disability determinations and decisions. We also 
explain that medical, psychological, and vocational experts, which may 
include such experts employed by or under contract with the State 
agencies, may affiliate with this national network only if they meet 
certain qualification standards.

Good Cause for Missing a Deadline

    The rules in subpart A also explain how we will determine whether 
you have shown good cause for missing a deadline to request a hearing 
or request further administrative review. The proposed rules are 
similar to the current regulations in that they list the factors we 
consider when determining whether good cause exists and provide 
examples of circumstances where we might find that good cause exists. 
The proposed regulations also provide that the same standard must be 
used for all such good cause determinations.

Fair and Impartial Administrative Review

    We are committed to ensuring the fairness of our adjudicative 
process. To that end, we explain in subpart A that adjudicators at 
every level of the administrative review process must consider the 
merits of your claim in a fair and impartial manner. We explain that an 
adjudicator who believes that he or she has any personal or financial 
interest in the matter pending for determination or decision is 
disqualified as an adjudicator and must withdraw from conducting any 
proceeding with respect to your disability claim. This provision 
applies to adjudicators at every level of the process, including State 
agency examiners, medical, psychological, and vocational experts, 
reviewing officials, administrative law judges, and officials at the 
Decision Review Board. Under our proposed rules, the adjudicator must 
believe that he or she has a personal or financial interest in the 
matter before he or she is disqualified and must withdraw from the 
matter. The adjudicator will not withdraw if he or she does not believe 
that the presence of a personal or financial interest is an issue in 
the adjudication of your case, even if you believe or assert that the 
adjudicator should withdraw.
    Our current regulations explain procedures you must follow to 
request that an administrative law judge withdraw from adjudicating 
your claim. We are proposing to change our regulations so that it is 
clear that the duty to withdraw when necessary applies to all 
adjudicators, not just administrative law judges. We expect that this 
procedure will continue to ensure that our hearing process remains 
fair.

Discrimination Complaints

    Our proposed rules at subpart A also explain that you may file a 
discrimination complaint against us if you believe that an adjudicator 
has improperly discriminated against you. Due to the very nature of the 
disability determination process, adjudicators must sometimes consider 
factors such as your age or your sex, or the nature of your 
impairment(s), when adjudicating claims for disability benefits. 
However, our proposed rules make clear that adjudicators must never 
give inappropriate consideration to your race, color, national origin, 
age, sex, religion, or nature of impairment(s). For example, it would 
be proper for an adjudicator to consider the sex of a claimant when 
adjudicating a claim based on allegations of certain gender-specific 
genitourinary or neoplastic impairments. However, it would normally be 
inappropriate for an adjudicator to establish that a claimant was 
precluded from certain types of work activity due to the claimant's 
particular sex rather than due to the claimant's particular functional 
capacity resulting from his or her impairment(s).
    Our proposed rules explain that if you believe an adjudicator has 
improperly considered your race, color, national origin, age, sex, 
religion, or nature of impairment(s) and has discriminated against you 
as a result, you may file a discrimination complaint against us. The 
proposed rules further explain that this complaint must be filed within 
60 days of the date upon which you became aware that you may have been 
discriminated against.

Quick Disability Determinations

    The rules in subpart B explain our proposal to establish a Quick 
Disability Determination process that will provide favorable 
determinations of disability to disability applicants who are clearly 
disabled. These rules provide that potential Quick Disability 
Determination claims will be processed by Quick Disability 
Determination units created in the State agencies. The rules in subpart 
B provide that the State agencies must ensure that an appropriate 
medical or psychological expert verifies the particular diagnosis that 
is the basis of the claim in each case. The Quick Disability 
Determination units will not make unfavorable determinations when 
processing potential Quick Disability Determination claims. The 
proposed rules provide that if a favorable Quick Disability 
Determination cannot be made within 20 days after a claim is received 
by the State agency, the claim must be removed from the unit and 
processed by the State agency in the normal manner using our existing 
procedures. If your claim was originally identified as a potential 
Quick Disability Determination claim but was removed from the unit for 
normal State agency processing, your claim will be adjudicated based on 
the date that the claim was originally referred to the Quick Disability 
Determination unit.

Initial Determinations

    The proposed rules in subpart B of part 405 explain how we will 
inform you that an initial determination has been made in your case. 
These proposed rules also explain that your initial determination will 
be binding unless you timely request that a reviewing official review 
your claim, or unless we revise your initial determination.

Reviewing Official

    The rules in subpart C of part 405 explain that, under our new 
approach, you may request administrative review by a Federal reviewing 
official if you are dissatisfied with the State agency's initial 
determination in your case. The rules reflect our objective of 
providing well-trained, centrally-administered Federal reviewing 
officials who will be able to adjudicate claims accurately and 
consistently in a timely manner. The rules provide that you will not 
have a right to a hearing before the reviewing official, and that the 
reviewing official's decision will be made solely on the basis of a 
review of the record.
    The rules explain that a reviewing official may obtain additional 
evidence necessary to adjudicate a claim in some

[[Page 43602]]

circumstances. The reviewing official may also remand a claim to the 
State agency when the State agency fails to carry out a duty that, if 
followed, would have resulted in a material change to the determination 
made at the initial level. The rules provide that in cases where the 
reviewing official disagrees with the State agency determination, the 
reviewing official must refer the case to a medical or psychological 
expert affiliated with the national network for evaluation of the 
evidence to determine the medical severity of your impairment(s). The 
rules also provide that if there is new and material evidence that the 
State agency did not consider, the reviewing official will make a 
decision in consultation with a qualified medical or psychological 
expert affiliated with the Federal Expert Unit.
    The proposed rules also require the reviewing official to provide 
you with a written notice of his or her decision that explains in clear 
and understandable language the specific reasons for the decision. The 
reviewing official must explain why he or she agrees or disagrees with 
the rationale articulated in the State agency's initial determination. 
This explanation will be sent to the State agencies and used for 
quality management purposes.
    The rules in subpart C of part 405 also explain that a reviewing 
official's decision will be binding on you unless you timely request a 
hearing before an administrative law judge, the reviewing official's 
decision is revised, or you go directly to Federal district court by 
properly using our expedited appeals process.

Administrative Law Judge Hearing Process

    The rules in subpart D of part 405 explain how we will decide your 
disability claim when you request a hearing before an administrative 
law judge. The rules in this subpart are based on our current rules in 
subpart J of part 404 and subpart N of part 416. For the most part, we 
have retained in subpart D the same rules that we currently follow. As 
under the current process, when you request a hearing on your 
disability claim, a de novo hearing will be held by an administrative 
law judge. The administrative law judge's role in the hearing process 
under these proposed rules will remain the same as it is under the 
current process: the administrative law judge will examine the evidence 
and make a decision regarding your entitlement to or eligibility for 
benefits.
    We propose that each administrative law judge assist our efforts to 
effectively manage the functions of the reviewing officials by 
explaining why he or she agrees or disagrees with the rationale 
articulated by the reviewing official that serves as the basis for the 
reviewing official's decision. Administrative law judges will provide 
this explanation in each of their decisions.
    We do not intend that this new responsibility will constrain an 
administrative law judge's independent decision making authority in any 
manner. Each administrative law judge will continue to issue written 
decisions based on his or her independent evaluation and consideration 
of the evidence offered at the hearing or otherwise included in the 
record. We believe that the inclusion of an explanation for why the 
administrative law judge agrees or disagrees with the rationale 
provided by the reviewing official will greatly assist our ability to 
provide reviewing officials with information from the hearing level 
that will help ensure that reviewing official decisions are based upon 
a fully developed record, are carefully articulated, and are consistent 
with program rules. We believe that with this assistance from each 
administrative law judge, we can ensure that the reviewing officials 
are making the right decision early in the administrative review 
process. Accordingly, we also propose that a copy of the administrative 
law judge's decision be sent to the reviewing official at the same time 
that it is sent to the claimant. This new, systematic process will also 
create a method for transmitting management information that will 
enable us to assess problems in decision making and to improve the 
quality of decisions.
    We also propose to make a number of other changes to our current 
rules. We expect that these changes will improve the hearings process 
by clarifying language in our current rules, by updating some of our 
rules to reflect changes in technology, and by making our hearing 
procedures more efficient. For example, we propose that the 
administrative law judge may decide, or you may request, that a 
prehearing conference be held to simplify or amend the issues to be 
considered by the administrative law judge, or to discuss matters that 
might expedite your hearing. We also propose that the administrative 
law judge may hold a post-hearing conference to facilitate the hearing 
decision.
    We propose to require that you submit all evidence available to you 
when you request your hearing. This rule will require you to submit all 
available evidence that supports the allegations that form the basis of 
your claim, as well as all available evidence that might undermine or 
appear contrary to your allegations. We also propose that you must 
submit all additional evidence that becomes available after you have 
filed your request to the administrative law judge no later than 20 
days before the hearing, or we will generally not consider such 
additional evidence.

The Decision Review Board

    The rules we propose in subpart E of part 405 explain what the 
Decision Review Board is and how it will operate. Subject to certain 
limited exceptions, you will not have the right to request that the 
Decision Review Board review the action that the administrative law 
judge takes on your claim for disability benefits. Instead, we envision 
that the Decision Review Board will help us to promote the consistency 
and efficiency of the adjudicatory process by promptly identifying and 
reviewing, and possibly readjudicating, those administrative law judge 
decisions that are the most likely to be erroneous.
    The proposed rules in subpart E explain how the Decision Review 
Board will review cases. The proposed rules also explain how we notify 
you that your case will be reviewed by the Decision Review Board, and 
what effect that review has on your right to seek judicial review of 
the administrative law judge's decision. We also propose procedures for 
cases that are before the Decision Review Board.
    We propose to address the issue of timeliness of the Decision 
Review Board's review in two ways. First, the proposed rules in subpart 
E set out time frames under which the Decision Review Board must act 
when it reviews a claim. Under our proposed rules, we will consider the 
administrative law judge's decision to be our final decision, for which 
you may seek judicial review, if the Decision Review Board does not 
complete its review within 90 days of the date of the administrative 
law judge's decision. Second, these proposed rules contain specific 
provisions governing the record that the Decision Review Board will 
consider. The rules also contain a specific definition of what 
constitutes new and material evidence.
    The proposed rules in subpart E also enhance our goal of improving 
the quality of our decision-making process. For example, the rules 
provide that the Decision Review Board will review the claim and act 
either by issuing a decision that affirms, reverses, or modifies the 
administrative law judge's decision, or by issuing an order that 
remands the case to the administrative

[[Page 43603]]

law judge for further proceedings. As is true for the other levels of 
the administrative review process, the Decision Review Board's action 
on cases that it reviews will provide valuable feedback to 
administrative law judges regarding the quality of their decisions.
    The rules that we are proposing will also help us to improve the 
quality of our decision-making process by providing you with the 
opportunity to request that the Decision Review Board vacate the 
administrative law judge's dismissal of your request for a hearing. The 
dismissal of a request for a hearing is not a final decision for which 
judicial review is available under section 205(g) of the Act. 
Accordingly, in order to ensure that disability claims are not 
dismissed improperly, we have decided to provide you with the 
opportunity to ask the Decision Review Board to vacate the dismissal of 
your hearing request.

Judicial Review

    As we noted earlier in the preamble, if these rules are issued as 
final rules, we will closely monitor the impact of these rules on the 
Federal courts. The rules in subpart F address three issues related to 
judicial review. First, we provide rules that govern how to request an 
extension of time in which to file a civil action. Second, we propose 
to provide procedures for cases that are remanded by a Federal court. 
Third, we propose to apply the same rules on acquiescence in circuit 
court case law that we currently apply under subpart I of part 404 and 
subpart N of part 416.

Reopening and Revising Determinations and Decisions

    Our current rules allow us to reopen and revise a determination or 
decision that has become final under certain specified circumstances. 
In subpart G of the proposed rules, we propose changes that are 
intended to improve the timeliness of our administrative review 
process. We propose to remove the current reopening criteria that 
allows us to reopen a determination or decision within one year of the 
date of the notice of the initial determination ``for any reason.'' In 
order to foster the finality of our decision making process, we propose 
to require that a determination or decision may be reopened in limited 
situations as defined in part 405, subpart G. We also propose to delete 
new and material evidence as a basis for finding good cause to reopen. 
Consistent with this change, we also propose that we will not find good 
cause to reopen a determination or decision if the only reason for 
requesting reopening is the existence of new evidence that was not 
considered in making the determination or decision.
    Under our proposed rules, for example, we would reopen your 
decision if you established within the requisite time limits that the 
evidence the administrative law judge considered when issuing your 
decision clearly showed on its face that an error was made. However, we 
would not reopen your decision if you presented new and material 
evidence after the issuance of your administrative law judge decision 
but had failed to earlier inform the administrative law judge during 
your hearing that you were attempting to obtain this evidence.

Expedited Appeals Process

    The proposed rules at Subpart H describe our expedited appeals 
process, which is essentially unchanged from the current expedited 
appeals process found in Subpart J of part 404 and Subpart N of part 
416. The proposed rules explain that you may use the expedited appeals 
process if you have no dispute with our findings of fact or our 
application and interpretation of the controlling law, but you believe 
that part of that law is unconstitutional. The proposed rules explain 
how you may seek our agreement to allow you to go directly to Federal 
district court so that the constitutional issue may be resolved.

State Agency Quick Disability Determination Units

    The proposed rules in subpart I describe the procedure State 
agencies must follow in order to be authorized to process Quick 
Disability Determination claims. First, we outline new responsibilities 
for the State agencies and for us. Second, we propose rules to measure 
whether the State agencies are processing Quick Disability 
Determination claims as required. Third, we explain what action we will 
take if the State agencies do not meet our Quick Disability 
Determination processing standards.

Payment of Certain Travel Expenses

    The proposed rules in subpart J explain that we use current 
regulations in 20 CFR Parts 404 and 416 for determining reimbursable 
expenses and for explaining how and where you may request reimbursement 
of certain travel expenses you incur when you file your disability 
claim.

Other Changes

    We propose to make several conforming changes to subparts J and P 
of part 404 and subparts I and N of part 416, and to add subpart I of 
part 422 of this chapter.

Clarity of These Proposed Rules

    Executive Order 12866 requires each agency to write all rules in 
plain language. In addition to your substantive comments on these 
proposed rules, we invite your comments on how to make these proposed 
rules easier to understand. For example:
    Have we organized the material to suit your needs?
    Are the requirements in the rules clearly stated?
    Do the rules contain technical language or jargon that is not 
clear?
    Would a different format (grouping and order of sections, use of 
headings, paragraphing) make the rules easier to understand?
    Would more (but shorter) sections be better?
    Could we improve clarity by adding tables, lists, or diagrams?
    What else could we do to make the rules easier to understand?

Regulatory Procedures

Executive Order 12866

    We have consulted with the Office of Management and Budget and have 
determined that these proposed rules meet the criteria for an 
economically significant regulatory action under Executive Order 12866. 
The Office of the Chief Actuary estimates that these proposed rules, if 
finalized, will result in increased program outlays resulting in the 
following costs (in millions of dollars) over the next 10 years:

------------------------------------------------------------------------
           Fiscal year               Title II    Title XVI      Total
------------------------------------------------------------------------
2006.............................           $5           $1           $5
2007.............................           40            7           46
2008.............................           94           11          105
2009.............................          209           43          253
2010.............................          307           43          350
2011.............................          277           39          316
2012.............................          156            8          164

[[Page 43604]]

 
2013.............................           31            2           32
2014.............................            2            2            4
2015.............................           -9        (\1\)           -9
                                  --------------
Total:
    2006-2010....................          654          104          758
    2006-2015....................        1,110          155       1,265
------------------------------------------------------------------------
Note: The totals may not equal the sum of the rounded components.
\1\ Decrease of less than $500,000.

Regulatory Flexibility Act

    We certify that these proposed rules will not have a significant 
economic impact on a substantial number of small entities as they 
affect only individuals or States. Therefore, a regulatory flexibility 
analysis as provided in the Regulatory Flexibility Act, as amended, is 
not required for these proposed rules.

Federalism Impact and Unfunded Mandates Impact

    We have reviewed these proposed rules under the threshold criteria 
of Executive Order 13132 and the Unfunded Mandates Reform Act and have 
determined that they do not have substantial direct effects on the 
States, on the relationship between the national government and the 
States, on the distribution of power and responsibilities among the 
various levels of government, or on imposing any costs on State, local 
or tribal governments. These proposed rules do not affect the roles of 
the State, local or tribal governments. However, the proposed rules 
take administrative notice of existing statute governing the role and 
relationship of the State agencies and SSA with respect to disability 
determinations under the Act.

Paperwork Reduction Act

    We are submitting an Information Collection Request to OMB for 
clearance. We have displayed a 1-hour placeholder burden for those 
sections covered by OMB-approved forms that the public already uses to 
report information. In addition, some sections show no annual reporting 
burden, because we are not required to seek OMB approval of these 
reporting requirements if they affect less than 10 respondents.
    Finally, as stated in the preamble, we can only implement our 
proposed changes to the disability determination process in States that 
have fully implemented, and are successfully operating under the 
electronic disability process (eDib). Based on our current progress 
with eDib implementation, we expect to implement the changes in the 
disability determination process in two regions during the first 12 
months after the final rule is published. The burden estimates reflect 
a gradual implementation by region, the number of claims and length of 
processing time we expect to occur at each level of appeal. Therefore, 
the annual burden estimates reflect the reporting burden associated 
with only those claims we expect to be processed using eDib and the new 
disability determination process.
    We are soliciting comments on the burden estimate; the need for the 
information; its practical utility; ways to enhance its quality, 
utility and clarity; and on ways to minimize the burden on respondents, 
including the use of automated collection techniques or other forms of 
information technology. Comments should be submitted and/or faxed to 
the Office of Management and Budget at the following number: Office of 
Management and Budget, Attn: Desk Officer for SSA, Fax Number: 202-395-
6974.

----------------------------------------------------------------------------------------------------------------
                                                                                      Average
                                                                   Frequency of     burden per       Estimated
           Section                   Number of  respondents          response        response     annual  burden
                                                                                     (minutes)        (hours)
----------------------------------------------------------------------------------------------------------------
                            Part 404, Subpart P, Determining Disability and Blindness
----------------------------------------------------------------------------------------------------------------
404.1512(c)..................  .................................  ..............  ..............               1
404.1513(c)..................  .................................  ..............  ..............               1
404.1519m....................  12...............................             137               5             137
404.1520a(d)(2), 404.1520a(e)  .................................  ..............  ..............               1
404.1529(b)..................  .................................  ..............  ..............               1
------------------------------
                     Part 405, Subpart A, Introduction, General Description and Definitions
----------------------------------------------------------------------------------------------------------------
405.1(a)(2)..................  See 405.201......................  ..............  ..............  ..............
405.1(a)(3)..................  See 495.301......................  ..............  ..............  ..............
405.1(b).....................  See 404.215 & 405.301............  ..............  ..............  ..............
405.20(a)....................  1,524............................               1              10             254
405.30.......................  71...............................               1              30            35.5
------------------------------
                                   Part 405, Subpart B, Initial Determinations
----------------------------------------------------------------------------------------------------------------
405.101(b)...................  .................................  ..............  ..............               1
------------------------------
                     Part 405, Subpart C, How to Request Review of an Initial Determination
----------------------------------------------------------------------------------------------------------------
405.20.......................  405.210(a)(b)(c)(d)..............  ..............  ..............               1
405.215, 405.220(b)..........  .................................  ..............  ..............               1
405.230(a)...................  See 450.305 & .310...............  ..............  ..............  ..............
------------------------------

[[Page 43605]]

 
                              Part 405, Subpart D, Administrative Law Judge Hearing
----------------------------------------------------------------------------------------------------------------
405.301......................  .................................  ..............  ..............               1
405.305, 405.310.............  .................................  ..............  ..............               1
405.310(d)...................  206..............................               1              10            34.3
405.316(b)...................  .................................  ..............  ..............               1
405.316(c)...................  .................................  ..............  ..............               1
405.317(a)...................  415..............................               1              10            69.2
405.317(b)...................  22...............................               1              30              11
405.330......................  2................................               1              20              .7
405.331......................  .................................  ..............  ..............               1
405.332......................  43...............................               1              30            21.5
405.333......................  .................................  ..............  ..............               1
405.334......................  3,317............................           \1\ 1          13,317
405.340(b)...................  .................................  ..............  ..............               1
405.350(a)(b)................  4,147............................               1              20         1,382.3
404.366......................  2................................               1              20              .7
405.370(b)...................  .................................  ..............  ..............               1
405.373(a)...................  151..............................               1              30            75.5
405.373(b)...................  .................................  ..............  ..............               1
405.380(a)...................  219..............................               1              10            36.5
405.381, 405.382.............  149..............................               1              30            74.5
------------------------------
                                   Part 405, Subpart E, Decision Review Board
----------------------------------------------------------------------------------------------------------------
405.405......................  See 405.381 & .382...............  ..............  ..............  ..............
405.425(b)...................  47...............................               1           \1\ 1              47
405.425(c)...................  See 405.381......................  ..............  ..............  ..............
405.425(d)...................  .................................  ..............  ..............               1
405.430(b)...................  See 405.381......................  ..............  ..............  ..............
------------------------------
                                      Part 405, Subpart F, Judicial Review
----------------------------------------------------------------------------------------------------------------
405.505......................  1................................               1              30              .5
------------------------------
                    Part 405, Subpart G, Reopening and Revising Determinations and Decisions
----------------------------------------------------------------------------------------------------------------
405.601(b)...................  158..............................               1              30              79
------------------------------
405.620(a), 405.625..........  .................................  ..............  ..............               1
------------------------------
                    Part 405, Subpart H, Expedited Appeals Process for Constitutional Issues
----------------------------------------------------------------------------------------------------------------
405.705(b), 405.710, 405.715.  .................................  ..............  ..............  ..............
------------------------------
        Part 405, Subpart I, Quick Disability Determination Unit and Other State Agency Responsibilities
----------------------------------------------------------------------------------------------------------------
405.815......................  See 405.101(b)...................  ..............  ..............  ..............
405.835......................  .................................  ..............  ..............  ..............
------------------------------
                            Part 416, Subpart I, Determining Disability and Blindness
----------------------------------------------------------------------------------------------------------------
416.912(c)...................  .................................  ..............  ..............               1
416.913(c)...................  .................................  ..............  ..............               1
416.919m.....................  See 404.1519m....................  ..............  ..............  ..............
416.920a(d)(2),                .................................  ..............  ..............               1
 416.920a(e)(1)(2).
416.924(g)...................  .................................  ..............  ..............               1
416.929(b)...................  .................................  ..............  ..............               1
------------------------------
                                     Part 422, Subpart B, General Procedures
----------------------------------------------------------------------------------------------------------------
422.130(b)...................  .................................  ..............  ..............               1
422.140......................  See 405.20.......................  ..............  ..............  ..............
----------------------------------------------------------------------------------------------------------------
\1\ Hour.

    Total Number of Respondents: 10,486.
    Total Estimated Annual Burden Hours: 5,600.2.

List of Organizations

    The following is a list of organizations that have met with SSA 
regarding our New Approach to Improve the Disability Determination 
Process:

American Association on Mental Retardation

[[Page 43606]]

American Association of People with Disabilities
American Bar Association
AARP (American Association of Retired Persons)
American Council of the Blind
American Federation of Government Employees
American Federation of State, County, and Municipal Employees
American Psychological Association
ARC of the United States
Association of Administrative Law Judges (AALJ)
Association of OHA Analysts
Association of Persons in Supported Employment
Association of University Centers on Disability
Center for Budget and Policy Priorities
Congressional Staff--House Subcommittee on Ways & Means
Consortium for Citizens with Disabilities
Department of Justice
Family Policy Associates
Federal Bar Association
Government Accountability Office (GAO)
Int'l Union, United Auto, Aerospace & Agricultural Implement Workers of 
America (UAW)
Judicial Conference of the United States
National Association of Councils on Developmental Disabilities (NACDD)
National Association of Disability Examiners (NADE)
National Association of Disability Representatives (NADR)
National Assoc. of Protection and Advocacy Systems, Inc.
National Association of State Directors of Developmental Disabilities 
Services
National Council on Disabilities
National Council of Disability Determination Directors (NCDDD)
National Council of Social Security Management Associations (NCSSMA)
National Organization of Social Security Claimants' Representatives 
(NOSSCR)
National Treasurers Employee Union (NTEU)
NISH (National Industries for the Severely Handicapped)
Office of the General Counsel Employees
Office of Hearings and Appeals Employees
Office of Quality Assurance Employees
Office of Disability and Income Security Programs (ODISP) Employees
Office of Management and Budget
Office of Operations
Paralyzed Veterans of America
Public Employees Federation (New York)
Public Policy Collaboration
Service Employees International Union
Social Security Advisory Board
SSA's Ticket To Work and Work Incentives Advisory Panel

(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; and 96.006, 
Supplemental Security Income)

List of Subjects

20 CFR Part 404

    Administrative practice and procedure; Blind, Disability benefits; 
Old-Age, Survivors, and Disability Insurance; Reporting and 
recordkeeping requirements; Social Security.

20 CFR Part 405

    Administrative practice and procedure; Blind, Disability benefits; 
Old-Age, Survivors, and Disability Insurance; Public assistance 
programs, Reporting and recordkeeping requirements; Social Security; 
Supplemental Security Income (SSI).

20 CFR Part 416

    Administrative practice and procedure; Aged, Blind, Disability 
benefits, Public assistance programs, Reporting and recordkeeping 
requirements; Supplemental Security Income (SSI).

20 CFR Part 422

    Administrative practice and procedure; Organization and functions 
(Government agencies); Reporting and recordkeeping requirements; Social 
Security.

Jo Anne B. Barnhart,
Commissioner of Social Security.
    For the reasons set out in the preamble, we propose to amend part 
404, add part 405, and amend parts 416 and 422 of chapter III of title 
20 of the Code of Federal Regulations as follows:

PART 404--FEDERAL OLD-AGE, SURVIVORS AND DISABILITY INSURANCE 
(1950- )

Subpart J--[Amended]

    1. The authority citation for subpart J of part 404 continues to 
read as follows:

    Authority: Secs. 201(j), 204(f), 205(a), (b), (d)-(h), and (j), 
221, 225, and 702(a)(5) of the Social Security Act (42 U.S.C. 
401(j), 404(f), 405(a), (b), (d)-(h), and (j), 421, 425, and 
902(a)(5)); sec. 5, Pub. L. 97-455, 96 Stat. 2500 (42 U.S.C. 405 
note); secs. 5, 6(c)-(e), and 15, Pub. L. 98-460, 98 Stat. 1802 (42 
U.S.C. 421 note).

    2. Amend Sec.  404.903 by removing ``and'' at the end of paragraph 
(u), by removing the ``.'' at the end of paragraph (v) and replacing it 
with ``;'', and by adding paragraphs (w) and (x) to read as follows:


Sec.  404.903  Administrative actions that are not initial 
determinations.

* * * * *
    (w) Determining whether to select your claim for the quick 
disability determination process under Sec.  405.101 of this chapter; 
and
    (x) The removal of your claim from the quick disability 
determination process under Sec.  405.101 of this chapter.

Subpart P--[Amended]

    3. The authority citation for subpart P of part 404 continues to 
read as follows:

    Authority: Secs. 202, 205(a), (b), and (d)-(h), 216(i), 221 (a) 
and (i), 222(c), 223, 225, and 702(a)(5) of the Social Security Act 
(42 U.S.C. 402, 405 (a), (b), and (d)-(h), 416(i), 421(a) and (i), 
422(c), 423, 425, and 902(a)(5)); sec. 211(b), Pub. L. 104-193, 110 
Stat. 2105, 2189.

    4. Amend Sec.  404.1502 by revising the definition of nonexamining 
source to read as follows:


Sec.  404.1502  General definitions and terms for this subpart.

* * * * *
    Nonexamining source means a physician, psychologist, or other 
acceptable medical source who has not examined you but provides a 
medical or other opinion in your case. At the administrative law judge 
hearing and Appeals Council levels of the administrative review 
process, and at the reviewing official, administrative law judge and 
Decision Review Board levels of the administrative review process in 
claims adjudicated under the procedures in part 405 of this chapter, it 
includes State agency medical and psychological consultants, other 
program physicians and psychologists, and medical experts we consult. 
See Sec.  404.1527.
* * * * *
    5. Amend Sec.  404.1503 by adding a sixth sentence to paragraph 
(a), and by removing the parenthetical statement after the first 
sentence of paragraph (e), to read as follows:


Sec.  404.1503  Who makes disability and blindness determinations.

    (a) * * * Subpart I of part 405 of this chapter contains additional 
rules that the States must follow in making disability and blindness 
determinations in cases adjudicated under the procedures in part 405 of 
this chapter.
* * * * *
    6. Amend Sec.  404.1512 by revising paragraph (b)(6), and the 
second sentence of paragraph (c) to read as follows:

[[Page 43607]]

Sec.  404.1512  Evidence.

* * * * *
    (b) * * *
    (6) At the administrative law judge and Appeals Council levels, and 
at the reviewing official, administrative law judge and Decision Review 
Board levels in claims adjudicated under the procedures in part 405 of 
this chapter, findings, other than the ultimate determination about 
whether you are disabled, made by State agency medical or psychological 
consultants and other program physicians or psychologists, and opinions 
expressed by medical experts we consult based on their review of the 
evidence in your case record. See Sec. Sec.  404.1527(f)(2) and (f)(3).
    (c) * * * You must provide evidence showing how your impairment(s) 
affect(s) your functioning during the time you say that you are 
disabled, and any other information that we need to decide your claim, 
including evidence that you consider to be unfavorable to your claim. * 
* *
* * * * *
    7. Amend Sec.  404.1513 by revising the first sentence of paragraph 
(c) to read as follows:


Sec.  404.1513  Medical and other evidence of your impairment(s).

* * * * *
    (c) * * * At the administrative law judge and Appeals Council 
levels, and at the reviewing official, administrative law judge and 
Decision Review Board levels in claims adjudicated under the procedures 
in part 405 of this chapter, we will consider residual functional 
capacity assessments made by State agency medical and psychological 
consultants and other program physicians and psychologists to be 
``statements about what you can still do'' made by nonexamining 
physicians and psychologists based on their review of the evidence in 
the case record.* * *
* * * * *
    8. Amend Sec.  404.1519k by revising paragraph (a) to read as 
follows:


Sec.  404.1519k  Purchase of medical examinations, laboratory tests, 
and other services.

* * * * *
    (a) Subject to the provisions of Sec.  405.15 in claims adjudicated 
under the procedures in part 405 of this chapter, the rate of payment 
to be used for purchasing medical or other services necessary to make 
determinations of disability may not exceed the highest rate paid by 
Federal or public agencies in the State for the same or similar types 
of service. See Sec. Sec.  404.1624 and 404.1626.
* * * * *
    9. Amend Sec.  404.1519m by revising the third sentence to read as 
follows:


Sec.  404.1519m  Diagnostic tests or procedures.

    * * * A State agency medical consultant, or a medical expert (as 
defined in Sec.  405.5 of this chapter) in claims adjudicated under the 
procedures in part 405 of this chapter, must approve the ordering of 
any diagnostic test or procedure when there is a chance it may involve 
significant risk. * * *
    10. Amend Sec.  404.1519s by revising paragraph (c) to read as 
follows:


Sec.  404.1519s  Authorizing and monitoring the consultative 
examination.

* * * * *
    (c) Subject to the provisions of Sec.  405.15 in claims adjudicated 
under the procedures in part 405 of this chapter, and consistent with 
Federal and State laws, the State agency administrator will work to 
achieve appropriate rates of payment for purchased medical services.
* * * * *
    11. Amend Sec.  404.1520a by revising the third sentence of 
paragraph (d)(2), adding a new fourth sentence to paragraph (d)(2) and 
revising paragraph (e) to read as follows:


Sec.  404.1520a  Evaluation of mental impairments.

* * * * *
    (d) * * *
    (2) * * * We will record the presence or absence of the criteria 
and the rating of the degree of functional limitation on a standard 
document at the initial and reconsideration levels of the 
administrative review process. We will record the presence or absence 
of the criteria and the rating of the degree of functional limitation 
in the decision at the administrative law judge hearing and Appeals 
Council levels (in cases in which the Appeals Council issues a 
decision), and in the decision at the reviewing official, 
administrative law judge and the Decision Review Board levels in claims 
adjudicated under the procedures in part 405 of this chapter. * * *
* * * * *
    (e) Documenting application of the technique. At the initial and 
reconsideration levels of the administrative review process, we will 
complete a standard document to record how we applied the technique. At 
the administrative law judge hearing and Appeals Council levels (in 
cases in which the Appeals Council issues a decision), and at the 
reviewing official, administrative law judge and the Decision Review 
Board levels in claims adjudicated under the procedures in part 405 of 
this chapter, we will document application of the technique in the 
decision.
    (1) At the initial and reconsideration levels, except in cases in 
which a disability hearing officer makes the reconsideration 
determination, our medical or psychological consultant has overall 
responsibility for assessing medical severity. At the initial level in 
claims adjudicated under the procedures in part 405 of this chapter, a 
medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) has overall responsibility for assessing medical severity. The 
State agency disability examiner may assist in preparing the standard 
document. However, our medical or psychological consultant (or the 
medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) in claims adjudicated under the procedures in part 405 of this 
chapter) must review and sign the document to attest that it is 
complete and that he or she is responsible for its content, including 
the findings of fact and any discussion of supporting evidence. When a 
disability hearing officer makes a reconsideration determination, the 
determination must document application of the technique, incorporating 
the disability hearing officer's pertinent findings and conclusions 
based on this technique.
    (2) At the administrative law judge hearing and Appeals Council 
levels, and at the reviewing official, administrative law judge and the 
Decision Review Board levels in claims adjudicated under the procedures 
in part 405 of this chapter, the written decision must incorporate the 
pertinent findings and conclusions based on the technique. The decision 
must show the significant history, including examination and laboratory 
findings, and the functional limitations that were considered in 
reaching a conclusion about the severity of the mental impairment(s). 
The decision must include a specific finding as to the degree of 
limitation in each of the functional areas described in paragraph (c) 
of this section.
    (3) Except in cases adjudicated under the procedures in part 405 of 
this chapter, if the administrative law judge requires the services of 
a medical expert to assist in applying the technique but such services 
are unavailable, the administrative law judge may return the case to 
the State agency or the appropriate Federal component, using the rules 
in Sec.  404.941, for completion of the standard document. If, after 
reviewing the case file and completing the standard document, the State 
agency

[[Page 43608]]

or Federal component concludes that a determination favorable to you is 
warranted, it will process the case using the rules found in Sec.  
404.941(d) or (e). If, after reviewing the case file and completing the 
standard document, the State agency or Federal component concludes that 
a determination favorable to you is not warranted, it will send the 
completed standard document and the case to the administrative law 
judge for further proceedings and a decision.
    12. Amend Sec.  404.1526 by revising the first sentence of 
paragraph (c) to read as follows:


Sec.  404.1526  Medical equivalence.

* * * * *
    (c) * * * A medical or psychological consultant designated by the 
Commissioner includes any medical or psychological consultant employed 
or engaged to make medical judgments by the Social Security 
Administration, the Railroad Retirement Board, or a State agency 
authorized to make disability determinations, and includes a medical or 
psychological expert (as defined in Sec.  405.5 of this chapter) in 
claims adjudicated under the procedures in part 405 of this chapter. * 
* *
    13. Amend Sec.  404.1527 by revising paragraph (f)(1) and by adding 
paragraph (f)(4) to read as follows:


Sec.  404.1527  Evaluating opinion evidence.

* * * * *
    (f) * * *
    (1) In claims adjudicated by the State agency, a State agency 
medical or psychological consultant (or a medical or psychological 
expert (as defined in Sec.  405.5 of this chapter) in claims 
adjudicated under the procedures in part 405 of this chapter) will 
consider the evidence in your case record and make findings of fact 
about the medical issues, including, but not limited to, the existence 
and severity of your impairment(s), the existence and severity of your 
symptoms, whether your impairment(s) meets or equals the requirements 
for any impairment listed in appendix 1 to this subpart, and your 
residual functional capacity. These administrative findings of fact are 
based on the evidence in your case record but are not themselves 
evidence at these steps.
* * * * *
    (4) In claims adjudicated under the procedures in part 405 of this 
chapter at the reviewing official, administrative law judge and the 
Decision Review Board levels of the administrative review process, we 
will follow the same rules for considering opinion evidence that 
administrative law judges follow under this section.
    14. Amend Sec.  404.1529 by revising the third and fifth sentences 
of paragraph (b) to read as follows:


Sec.  404.1529  How we evaluate symptoms, including pain.

* * * * *
    (b) * * * In cases decided by a State agency (except in disability 
hearings), a State agency medical or psychological consultant, a 
medical or psychological consultant designated by the Commissioner, or 
a medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) in claims adjudicated under the procedures in part 405 of this 
chapter, directly participates in determining whether your medically 
determinable impairment(s) could reasonably be expected to produce your 
alleged symptoms. * * * At the administrative law judge hearing or 
Appeals Council level of the administrative review process, or at the 
reviewing official, administrative law judge and the Decision Review 
Board levels in claims adjudicated under the procedures in part 405 of 
this chapter, the adjudicator(s) may ask for and consider the opinion 
of a medical or psychological expert concerning whether your 
impairment(s) could reasonably be expected to produce your alleged 
symptoms. * * *
* * * * *
    15. Amend Sec.  404.1546 by revising the text of paragraph (a) and 
by adding a new paragraph (d) to read as follows:


Sec.  404.1546  Responsibility for assessing your residual functional 
capacity.

    (a) * * * When a State agency makes the disability determination, a 
State agency medical or psychological consultant(s) (or a medical or 
psychological expert (as defined in Sec.  405.5 of this chapter) in 
claims adjudicated under the procedures in part 405 of this chapter) is 
responsible for assessing your residual functional capacity.
* * * * *
    (d) Responsibility for assessing residual functional capacity in 
claims adjudicated under part 405 of this chapter. In claims 
adjudicated under the procedures in part 405 of this chapter at the 
reviewing official, administrative law judge and the Decision Review 
Board levels of the administrative review process, the reviewing 
official, the administrative law judge or the Decision Review Board is 
responsible for assessing your residual functional capacity.

Subpart Q--[Amended]

    16. The authority citation for subpart Q of part 404 continues to 
read as follows:

    Authority: Secs. 205(a), 221, and 702(a)(5) of the Social 
Security Act (42 U.S.C. 405(a), 421, and 902(a)(5)).

    17. Amend Sec.  404.1601 by adding a new third sentence to the 
introductory text to read as follows:


Sec.  404.1601  Purpose and scope.

    * * * Subpart I of part 405 of this chapter contains additional 
rules that the States must follow in making disability and blindness 
determinations in cases adjudicated under the procedures in part 405 of 
this chapter.
* * * * *
    18. Amend Sec.  404.1616 by adding a new third sentence in 
paragraph (b) and a new paragraph (e)(4) to read as follows:


Sec.  404.1616  Medical or psychological consultants.

* * * * *
    (b) * * * In claims adjudicated under the procedures in part 405 of 
this chapter, medical experts employed by or under contract with the 
State agencies must meet the qualification standards prescribed by the 
Commissioner.
* * * * *
    (e) * * *
    (4) In claims adjudicated under the procedures in part 405 of this 
chapter, psychological experts employed by or under contract with the 
State agencies must meet the qualification standards prescribed by the 
Commissioner.
* * * * *
    19. Amend Sec.  404.1624 by revising the first sentence to read as 
follows:


Sec.  404.1624  Medical and other purchased services.

    Subject to the provisions of Sec.  405.15 of this chapter in claims 
adjudicated under the procedures in part 405 of this chapter, the State 
will determine the rates of payment to be used for purchasing medical 
or other services necessary to make determinations of disability. * * *
    20. A new part 405 is added to read as follows:

PART 405--ADMINISTRATIVE REVIEW PROCESS FOR ADJUDICATING INITIAL 
DISABILITY CLAIMS

Subpart A--Introduction, General Description, and Definitions

Sec.
405.1 Introduction.
405.5 Definitions.

[[Page 43609]]

405.10 Federal Expert Unit.
405.15 National network of medical and vocational experts.
405.20 Good cause for missing deadlines.
405.25 Disqualification of disability adjudicators.
405.30 Discrimination complaints

Subpart B--Initial Determinations

405.101 Quick disability determination process.
405.105 Making quick disability determinations.
405.110 Disability determinations.
405.115 Notice of the initial determination.
405.120 Effect of an initial determination.

Subpart C--Review of Initial Determinations by a Reviewing Official

405.201 Reviewing an initial determination--general.
405.210 How to request review of an initial determination.
405.215 Procedures before a reviewing official.
405.220 Decision by the reviewing official.
405.225 Notice of the reviewing official's decision.
405.230 Effect of the reviewing official's decision.

Subpart D--Administrative Law Judge Hearing

405.301 Hearing before an administrative law judge--general.
405.302 Authority of administrative law judges.
405.305 Availability of a hearing before an administrative law 
judge.
405.310 How to request a hearing before an administrative law judge.
405.315 Time and place for a hearing before an administrative law 
judge.
405.316 Notice of a hearing before an administrative law judge.
405.317 Objections.
405.320 Administrative law judge hearing procedures--general.
405.325 Issues before an administrative law judge.
405.330 Prehearing conferences.
405.331 Submitting evidence to an administrative law judge.
405.332 Subpoenas.
405.333 Submitting documents other than evidence.
405.334 Prehearing statements.
405.340 Deciding a claim without a hearing before an administrative 
law judge.
405.350 Presenting evidence at a hearing before an administrative 
law judge.
405.351 Closing statements.
405.360 Official record.
405.365 Consolidated hearing before an administrative law judge.
405.366 Posthearing conferences.
405.370 Decision by the administrative law judge.
405.371 Notice of the decision of an administrative law judge.
405.372 Finality of an administrative law judge's decision.
405.373 Requesting consideration of new and material evidence.
405.380 Dismissal of a request for a hearing before an 
administrative law judge.
405.381 Notice of dismissal of a request for a hearing before an 
administrative law judge.
405.382 Vacating a dismissal of a request for a hearing before an 
administrative law judge.
405.383 Effect of dismissal of a request for a hearing before an 
administrative law judge.

Subpart E--Decision Review Board

405.401 Procedures before the Decision Review Board--general.
405.405 Decision Review Board.
405.410 Selecting claims for Board review.
405.415 Notification by the Decision Review Board.
405.420 Effect of Board review on the right to seek judicial review.
405.425 Procedures before the Decision Review Board.
405.430 Record before the Decision Review Board.
405.440 Actions that the Decision Review Board may take.
405.445 Notification of the Decision Review Board's action.
405.450 Effect of the Decision Review Board's action.

Subpart F--Judicial Review

405.501 Judicial review.
405.505 Extension of time to file a civil action.
405.510 Claims remanded by a Federal court.
405.515 Application of circuit court law.

Subpart G--Reopening and Revising Determinations and Decisions

405.601 Reopening and revising determinations and decisions.
405.605 Conditions for reopening.
405.610 Late completion of timely investigation.
405.615 Notice of revised determination or decision.
405.620 Effect of revised determination or decision.
405.625 Time and place to request a hearing on a revised 
determination or decision.
405.630 Finality of findings when later claim is filed on same 
earnings record.

Subpart H--Expedited Appeals Process for Constitutional Issues

405.701 Expedited appeals process--general.
405.705 When the expedited appeals process may be used.
405.710 How to request an expedited appeal.
405.715 Agreement in expedited appeals process.
405.720 Notice of agreement to expedite your appeal.
405.725 Effect of expedited appeals process agreement.

Subpart I--Quick Disability Determination Unit and Other State 
Agency Responsibilities

405.801 Purpose and scope.
405.805 Our and the State agency's basic responsibilities.
405.810 Deemed notice that the State wishes to perform the quick 
disability determination function.
405.815 Making quick disability determinations.
405.820 Notifying claimants of the quick disability determination.
405.825 Processing standard.
405.830 How and when we determine whether the processing standard is 
met.
405.835 Action we will take if a State agency does not meet the 
quick disability determination processing time standard.
405.840 Good cause for not following the Act, our regulations, and 
other written guidelines.
405.845 Hearings and appeals.
405.850 Assumption of the quick disability determination function 
when we make a finding of substantial failure.

Subpart J--Payment of Certain Travel Expenses

405.901 Reimbursement of certain travel expenses.

    Authority: Secs. 201(j), 205(a)-(b), (d)-(h), and (s), 221, 
223(a)-(b), 702(a)(5), 1601, 1602, 1631, and 1633 of the Social 
Security Act (42 U.S.C. 401(j), 405(a)-(b), (d)-(h), and (s), 421, 
423(a)-(b), 902(a)(5), 1381, 1381a, 1383, and 1383(b).

Subpart A--Introduction, General Description, and Definitions


Sec.  405.1  Introduction.

    (a) Explanation of the administrative review process. This part 
explains our procedures for adjudicating disability claims under titles 
II and XVI of the Social Security Act. Generally, the administrative 
review process consists of several steps, which must be requested 
within certain time periods. (Some of these time frames are for 
purposes of managing the process, such as the 90-day time frame within 
which a hearing date should be scheduled; they do not confer on 
claimants any individual substantive or procedural rights that 
claimants can appeal.) The administrative review process steps are:
    (1) Initial determination. We make an initial determination about 
your entitlement to benefits based on disability under title II of the 
Act or your eligibility for supplemental security income payments based 
on disability or blindness under title XVI of the Act. We also 
determine the period of disability.
    (2) Review of initial determination. If you are dissatisfied with 
an initial determination, you may request review by a Federal reviewing 
official.

[[Page 43610]]

    (3) Hearing before an administrative law judge. If you are 
dissatisfied with a decision made by the reviewing official, you may 
request a hearing before an administrative law judge. The 
administrative law judge's decision becomes our final decision, unless 
we refer your claim to the Decision Review Board.
    (4) Decision Review Board. When the Decision Review Board reviews 
your claim and issues a decision, that decision is our final decision.
    (5) Federal court review. If you are dissatisfied with our final 
decision as described in paragraphs (a)(3) and (4) of this section, you 
may request judicial review by filing an action in the Federal district 
court in the district where you reside.
    (b) Nature of the administrative review process. In making a 
determination or decision in your claim, we conduct the administrative 
review process in a non-adversarial manner. Subject to the provisions 
of Sec. Sec.  405.331 and 405.430, at each step of the administrative 
review process, you may present, and we will consider, any information 
in support of your claim. We also will consider any relevant 
information that we have in our records. You may have someone represent 
you, including an attorney. When we make a determination or decision on 
your claim for benefits, we will apply a preponderance of the evidence 
standard, except that the Decision Review Board will review findings of 
fact under the substantial evidence review standard. When we adjudicate 
your claim, the notice of our determination or decision will explain in 
clear and understandable language our specific reasons for allowing or 
denying your claim. If you do not seek timely review at the next step 
required by these procedures, you will lose your right to further 
administrative review and your right to judicial review, unless you can 
show good cause under Sec.  405.20 for your failure to request timely 
review.
    (c) Expedited appeals process. You may use the expedited appeals 
process if you have no dispute with our findings of fact and our 
application and interpretation of the controlling law, but you believe 
that a part of that law is unconstitutional. This process permits you 
to seek our agreement to allow you to go directly to a Federal district 
court so that the constitutional issue(s) may be resolved.


Sec.  405.5  Definitions.

    As used in this part:
    Act means the Social Security Act, as amended.
    Administrative appeals judge means an official, other than an 
administrative law judge, appointed by the Commissioner to serve on the 
Decision Review Board.
    Administrative law judge means an administrative law judge 
appointed pursuant to the provisions of 5 U.S.C. 3105.
    Articulate means to explain in clear and understandable language 
the specific basis for the determination or decision, including an 
analysis of the relevant evidence in the record supporting the 
determination or decision.
    Board means Decision Review Board.
    Commissioner means the Commissioner of Social Security, or his or 
her designee.
    Date you receive notice means 5 days after the date on the notice, 
unless you show us that you did not receive it within the 5-day period.
    Day means calendar day, unless otherwise indicated.
    Decision means the decision made by a Federal reviewing official, 
an administrative law judge, or the Decision Review Board.
    Decision Review Board means the body comprised of administrative 
law judges and administrative appeals judges that reviews decisions and 
dismissal orders by administrative law judges.
    Disability claim or claim means:
    (1) A claim filed for benefits based on disability under title II 
of the Act,
    (2) A claim for supplemental security income payments based on 
disability or blindness under title XVI of the Act, or
    (3) A claim based on disability or blindness under both titles II 
and XVI of the Act.
    Federal Expert Unit means the body composed of medical, 
psychological, and vocational experts, selected under criteria 
established by the Commissioner, that provides expertise to disability 
adjudicators at all levels of the administrative review process.
    Initial determination means the determination by the State agency.
    Material means that there would be a high likelihood that the 
outcome in your claim would change.
    Medical expert means a State agency or Federal medical professional 
who has the qualifications required by the Commissioner. It also means 
an acceptable medical source under Sec. Sec.  404.1513(a) or 416.913(a) 
of this chapter who is affiliated with the national network.
    National network means those medical, psychological, and vocational 
experts, which may include such experts employed by or under contract 
with the State agencies, who have the qualifications required by the 
Commissioner and who, under agreement with the Federal Expert Unit, 
provide advice within their areas of expertise to adjudicators at all 
levels of the administrative review process.
    Preponderance of the evidence means such relevant evidence that as 
a whole shows that the existence of the fact to be proven is more 
likely than not.
    Psychological expert means a State agency or Federal psychological 
professional who has the qualifications required by the Commissioner. 
It also means an acceptable medical source under Sec. Sec.  
404.1513(a)(2) or 416.913(a)(2) of this chapter who is affiliated with 
the national network.
    Quick disability determination means an initial determination on a 
claim where we have identified your diagnosis as one that reflects a 
high degree of probability that you will be found disabled.
    Quick Disability Determination Unit means the component of the 
State agency that is authorized to make quick disability 
determinations.
    Remand means to return a claim for further action by the component 
that made the determination or decision under review.
    Reviewing official means a Federal official who performs the review 
of the initial determination.
    State agency means the agency of a State that has been designated 
by the State to carry out the disability determination function.
    Substantial evidence means such relevant evidence as a reasonable 
mind might accept as adequate to support a conclusion.
    Vacate means to set aside a previous action.
    Vocational expert means a State agency or Federal vocational 
specialist who has the qualifications required by the Commissioner. It 
also means a vocational specialist who is affiliated with the national 
network.
    Waive means to give up a right knowingly and voluntarily.
    We, us, or our refers to the Social Security Administration.
    You or your refers to the person who has filed a disability claim 
and, where appropriate, his or her authorized representative.


Sec.  405.10  Federal Expert Unit.

    The Federal Expert Unit provides medical, psychological, and 
vocational expertise to State agencies, reviewing officials, 
administrative law judges, and the Decision Review Board. It oversees 
the national network of medical and vocational experts established 
under

[[Page 43611]]

Sec.  405.15. If a State agency refers a claim to the Federal Expert 
Unit, a medical or psychological expert affiliated with the national 
network evaluates the evidence to determine the medical severity of 
your impairment(s).


Sec.  405.15  National network of medical and vocational experts.

    The national network of medical, psychological, and vocational 
experts, which may include such experts employed by or under contract 
with the State agencies, provides expert advice to disability 
adjudicators. Experts affiliated with the national network must meet 
the qualifications prescribed by the Commissioner and may be used by 
the State agencies and other adjudicators at all levels of the 
administrative review process, in accordance with procedures 
established by the Commissioner. At hearings, medical, psychological, 
and vocational experts whom administrative law judges may call to 
provide impartial testimony on disability issues must be affiliated 
with the national network; experts whom you call, and that the 
administrative law judge approves, for hearing are not required to be 
so affiliated. We pay experts affiliated with the national network at 
rates established by the Commissioner for services provided to all 
adjudicators, including for services provided to State agencies.


Sec.  405.20  Good cause for missing deadlines.

    (a) If you wish us to extend the deadline to request a review under 
Sec.  405.210, a hearing under Sec.  405.310, action by the Decision 
Review Board under Sec.  405.382(b), or judicial review under 
Sec. Sec.  405.501 and 405.505, you must establish that you had good 
cause for missing the deadline. To establish good cause, you must 
document that--
    (1) Our action misled you;
    (2) You had a physical, mental, educational, or linguistic 
limitation(s) that would prevent a reasonable person from filing a 
timely request, or
    (3) Some other unusual and unavoidable circumstance beyond your 
control prevented you from filing a timely request.
    (b) Examples of circumstances that, if documented, may establish 
good cause include, but are not limited to, the following:
    (1) You were seriously ill, and your illness prevented you from 
contacting us in person, in writing, or through a friend, relative, or 
other person;
    (2) There was a death or serious illness in your immediate family;
    (3) Important records were destroyed or damaged by fire or other 
accidental cause;
    (4) Within the time limit for requesting further review, you asked 
us for additional information explaining our action, and within 60 days 
of receiving the explanation you requested a review;
    (5) We gave you incorrect or incomplete information about when and 
how to request administrative review or to file a civil suit;
    (6) You did not receive notice of the determination or decision, or
    (7) You sent the request to another Government agency in good faith 
within the time limit, and the request did not reach us until after the 
time period had expired.


Sec.  405.25  Disqualification of disability adjudicators.

    Adjudicators at all levels of the administrative review process 
recognize the need for fair and impartial consideration of the merits 
of your claim. Any adjudicator who has any personal or financial 
interest in the matter pending for determination or decision will 
withdraw from conducting any proceeding with respect to your disability 
claim. If the adjudicator so withdraws, we will assign your claim to 
another adjudicator for a determination or decision.


Sec.  405.30  Discrimination complaints.

    At all levels of the administrative review process, we do not give 
inappropriate consideration to your race, color, national origin, age, 
sex, religion, or nature of your impairment(s). If you believe that an 
adjudicator has improperly discriminated against you, you may file a 
discrimination complaint with us. You must file any such complaint 
within 60 days of the date upon which you became aware that you may 
have been discriminated against.

Subpart B--Initial Determinations


Sec.  405.101  Quick disability determination process.

    (a) If we identify your claim as one involving a high degree of 
probability that you are disabled, and we expect that your allegations 
will be easily and quickly verified, we will refer your claim to a 
Quick Disability Determination Unit.
    (b) If we send your claim to a Quick Disability Determination Unit, 
within 20 days of the date your claim is received by the unit, that 
unit must:
    (1) Have a medical or psychological expert verify your diagnosis, 
and
    (2) Subject to the provisions of paragraph (c) of this section, 
make the quick disability determination as described in Sec.  405.105.
    (c) If the Quick Disability Determination Unit cannot make a 
determination that is favorable to you, or if it cannot process your 
claim within 20 days of receiving it, the State agency will adjudicate 
your claim using the applicable procedures in subpart Q of part 404 or 
subpart J of part 416 of this chapter or both, and will apply subpart P 
of part 404 or subpart I of part 416 of this chapter or both.


Sec.  405.105  Making quick disability determinations.

    (a) Subject to the provisions of Sec.  405.101 and paragraph (b) of 
this section, when making a quick disability determination, the State 
agency will apply subpart P of part 404 or subpart I of part 416 of 
this chapter or both.
    (b) Quick disability determinations in the State agency will be 
made by the Quick Disability Determination Unit only after a medical or 
psychological expert has verified your diagnosis.


Sec.  405.110  Disability determinations.

    If we do not refer your claim for a quick disability determination, 
the State agency will adjudicate your claim using the applicable 
procedures in subpart Q of part 404 or subpart J of part 416 of this 
chapter or both and will apply subpart P of part 404 or subpart I of 
part 416 of this chapter or both.


Sec.  405.115  Notice of the initial determination.

    We will mail a written notice of the initial determination to you 
at your last known address. The written notice will articulate, in 
clear and understandable language, the specific reasons for and the 
effect of the initial determination. We also will inform you of the 
right to review by a reviewing official.


Sec.  405.120  Effect of an initial determination.

    An initial determination is binding unless--
    (a) You request review by a reviewing official within the time 
period stated in Sec.  405.210, or
    (b) We revise the initial determination under subpart G of this 
part.

Subpart C--Review of Initial Determinations by a Reviewing Official


Sec.  405.201  Reviewing an initial determination--general.

    If you are dissatisfied with the initial determination on your 
disability claim, you may request review by a reviewing official.


Sec.  405.210  How to request review of an initial determination.

    (a) Written request. You must request review by filing a written 
request. You should include in your request--

[[Page 43612]]

    (1) Your name and social security number,
    (2) If you have filed a claim for benefits based on disability 
under title II of the Act, the name and social security number of the 
wage earner under whose account you are filing if different from yours,
    (3) The specific reasons you disagree with the initial 
determination on your disability claim,
    (4) Additional evidence that you have available to you, and
    (5) The name and address of your representative, if any.
    (b) Time limit for filing request. We will review an initial 
determination if you request review in writing no later than 60 days 
after the date you receive notice of the initial determination (or 
within the extended time period if we extend the time as provided in 
paragraph (d) of this section).
    (c) Place for filing request. You should submit a written request 
for review at one of our offices. If you have a disability claim under 
title II of the Act, you may also file the request at the Veterans 
Administration Regional Office in the Philippines, or if you have 10 or 
more years of service in the railroad industry, an office of the 
Railroad Retirement Board.
    (d) Extension of time to request review. If you want us to review 
the initial determination on your disability claim, but you do not 
request review timely, you may ask us for more time to request review. 
Your request for an extension of time must be in writing and must give 
the reasons the request for review was not filed in time. If you show 
us that you had good cause for missing the deadline, we will extend the 
time period. To determine whether good cause exists, we will use the 
standards explained in Sec.  405.20.


Sec.  405.215  Procedures before a reviewing official.

    After you request review, the reviewing official will consider the 
evidence used in making the initial determination, any additional 
evidence that you submit along with your request for review, and any 
other evidence that the reviewing official obtains. If additional 
evidence is necessary, the reviewing official may obtain such evidence 
from other sources, or he or she may retain jurisdiction and send the 
claim to the State agency for it to obtain the additional evidence. The 
reviewing official also may remand a claim back to the State agency for 
it to readjudicate the claim.


Sec.  405.220  Decision by the reviewing official.

    (a) The reviewing official will make a decision based on all of the 
relevant evidence. The written decision will articulate, in clear and 
understandable language, the specific reasons for the decision, 
including an explanation as to why the reviewing official agrees or 
disagrees with the rationale articulated in the initial determination.
    (b) If the reviewing official disagrees with the initial 
determination, the reviewing official may issue a decision only after a 
medical or psychological expert affiliated with the national network 
has evaluated the evidence to determine the medical severity of your 
impairment(s). If you submit new and material medical evidence for 
consideration by the reviewing official, the reviewing official will 
make a decision in consultation with a medical or psychological expert 
affiliated with the national network.
    (c) The reviewing official may remand your claim to the State 
agency to revise the initial determination if the reviewing official 
determines that the State agency did not make a material finding that 
might have changed the outcome of the determination made at the initial 
level.


Sec.  405.225  Notice of the reviewing official's decision.

    We will mail a written notice of the reviewing official's decision 
to you at your last known address. We will also inform you of your 
right to a hearing before an administrative law judge.


Sec.  405.230  Effect of the reviewing official's decision.

    The reviewing official's decision is binding unless--
    (a) You request a hearing before an administrative law judge within 
60 days of the date you receive notice of the reviewing official's 
decision and a decision is made by the administrative law judge,
    (b) The expedited appeals process is used, or
    (c) We revise the reviewing official's decision under subpart G of 
this part.

Subpart D--Administrative Law Judge Hearing


Sec.  405.301  Hearing before an administrative law judge--general.

    This subpart explains what to do if you are dissatisfied with a 
decision (including a revised decision) by a reviewing official. In it, 
we describe how you may ask for a hearing before an administrative law 
judge. The Commissioner will appoint an administrative law judge to 
conduct the hearing. If circumstances warrant after making the 
appointment (for example, if the administrative law judge becomes 
unavailable), the Commissioner may assign your claim to another 
administrative law judge. You may appear at the hearing, submit new 
evidence, examine the evidence used in making the reviewing official's 
decision, and present and question witnesses. The administrative law 
judge may ask you questions and will issue a decision based on the 
hearing record. If you waive your right to appear at the hearing, the 
administrative law judge will make a decision based on the evidence 
that is in the file, any new evidence timely submitted, and any 
evidence that the administrative law judge obtains.


Sec.  405.302  Authority of administrative law judges.

    The administrative law judge derives his or her authority from the 
Commissioner and has the authority to find facts and to conduct a fair 
and impartial hearing in accordance with section 205(b) of the Act.


Sec.  405.305  Availability of a hearing before an administrative law 
judge.

    You may request a hearing before an administrative law judge if a 
reviewing official has made a decision, including a revised decision, 
on your disability claim.


Sec.  405.310  How to request a hearing before an administrative law 
judge.

    (a) Written request. You must request a hearing by filing a written 
request. You must include in your request--
    (1) Your name and social security number,
    (2) If you have filed a claim for benefits based on disability 
under title II of the Act, the name and social security number of the 
wage earner under whose account you are filing if different from yours,
    (3) The specific reasons you disagree with the decision made by the 
reviewing official,
    (4) Additional evidence that you have available to you, and
    (5) The name and address of your representative, if any.
    (b) Time limit for filing request. An administrative law judge will 
conduct a hearing if you request one in writing no later than 60 days 
after the date you receive notice of the reviewing official's decision 
(or within the extended time period if we extend the time as provided 
in paragraph (d) of this section).
    (c) Place for filing request. You should submit a written request 
for a hearing at one of our offices. If you have a disability claim 
under title II of the Act,

[[Page 43613]]

you may also file the request at the Veterans Administration Regional 
Office in the Philippines, or if you have 10 or more years of service 
in the railroad industry, an office of the Railroad Retirement Board.
    (d) Extension of time to request review. If you want a hearing 
before an administrative law judge, but you do not request it timely, 
you may ask us for more time to request review. Your request for an 
extension of time must be in writing and must give the reasons the 
request for review was not filed in time. If you show us that you had 
good cause for missing the deadline, we will extend the time period. To 
determine whether good cause exists, we use the standards explained in 
Sec.  405.20.
    (e) Waiver of the right to appear. After you submit your request 
for a hearing, you may ask the administrative law judge to decide your 
claim without a hearing, as described in Sec.  405.340(b). The 
administrative law judge may grant the request unless he or she 
believes that a hearing is necessary to decide your claim. You may 
withdraw this waiver of your right to appear at a hearing any time 
before notice of the hearing decision is mailed to you, and we will 
schedule a hearing as soon as practicable.


Sec.  405.315  Time and place for a hearing before an administrative 
law judge.

    (a) General. The administrative law judge sets the time and place 
for the hearing. Within 90 days of the date we receive the hearing 
request, the administrative law judge will set the time and place for 
the hearing. The administrative law judge will notify you of the 
hearing date at least 45 days before the hearing, unless you agree to a 
shorter notice period. The administrative law judge may change the time 
and place of the hearing, if it is necessary. If the administrative law 
judge changes the time and place of the hearing, he or she will send 
you reasonable notice of the change.
    (b) Where we hold hearings. We hold hearings in the 50 States, the 
District of Columbia, American Samoa, Guam, the Northern Mariana 
Islands, the Commonwealth of Puerto Rico, and the United States Virgin 
Islands.
    (c) Determination regarding in-person or video teleconference 
appearance of witnesses at the hearing. In setting the time and place 
of the hearing, the administrative law judge will determine whether you 
or any other person will appear at the hearing in person or by video 
teleconferencing. Video teleconferencing will be used when it is 
available and when it would be more efficient than conducting an 
examination of a witness in person. Section 405.350 explains how you 
and witnesses appear and present evidence at hearings.


Sec.  405.316  Notice of a hearing before an administrative law judge.

    (a) Issuing the notice. After the administrative law judge sets the 
time and place of the hearing, we will mail notice of the hearing to 
you at your last known address, or give the notice to you by personal 
service. We will mail or serve the notice at least 45 days before the 
hearing.
    (b) Notice information. The notice of hearing will tell you:
    (1) The specific issues to be decided,
    (2) That you may designate a person to represent you during the 
proceedings,
    (3) How to request that we change the time or place of your 
hearing,
    (4) That your hearing request may be dismissed if you fail to 
appear at your scheduled hearing without good cause, and
    (5) Whether your or a witness's appearance will be by video 
teleconferencing.
    (c) Acknowledging the notice of hearing. In the notice of hearing, 
we will ask you to return a form to let us know that you received the 
notice. If you or your representative do(es) not acknowledge receipt of 
the notice of hearing, we will attempt to contact you to see if you 
received it. If you tell us that you did not receive the notice of 
hearing, we will send you an amended notice by certified mail.


Sec.  405.317  Objections.

    (a) Time and place. (1) If you object to the time or place of your 
hearing, you must notify the administrative law judge in writing within 
10 days of the date you receive the notice of hearing. You must state 
the reason(s) for your objection and propose a time and place you want 
the hearing to be held.
    (2) The administrative law judge will consider your reason(s) for 
requesting the change and the impact of the proposed change on the 
efficient administration of the hearing process. Factors affecting the 
impact of the change include, but are not limited to, the effect on the 
processing of other scheduled hearings, delays which might occur in 
rescheduling your hearing, and whether we previously granted to you any 
changes in the time or place of your hearing.
    (3) If you object to appearing by videoconferencing, we will re-
schedule the hearing to a time and place at which you may appear in 
person before the administrative law judge.
    (b) Issues. If you object to the issues to be decided at the 
hearing, you must notify the administrative law judge in writing within 
10 days of the date you receive the notice of hearing. You must state 
the reason(s) for your objection. The administrative law judge will 
make a decision on your objection either at the hearing or in writing 
before the hearing.


Sec.  405.320  Administrative law judge hearing procedures--general.

    A hearing is open only to you and to other persons the 
administrative law judge considers necessary and proper. Proceedings 
will be conducted in an orderly and efficient manner. At the hearing, 
the administrative law judge will look fully into the issues, will 
question you and the other witnesses, and will accept any evidence that 
is material to the issues and that is submitted in accordance with 
Sec.  405.331. The administrative law judge will decide the order in 
which the evidence will be presented. The administrative law judge may 
stop the hearing temporarily and continue it at a later date if he or 
she decides that there is evidence missing from the record that must be 
obtained before the hearing may continue. At any time before the 
administrative law judge mails a notice of the decision, he or she may 
hold a supplemental hearing in order to receive additional evidence, 
consistent with the procedures described below. If an administrative 
law judge requires medical or vocational testimony in your claim, the 
Federal Expert Unit will provide an appropriate expert who has not had 
any prior involvement in your claim.


Sec.  405.325  Issues before an administrative law judge.

    (a) General. The issues before the administrative law judge include 
all the issues raised by your claim regardless of whether or not the 
issues may have already been decided in your favor.
    (b) New issues. Any time after receiving the hearing request and 
before mailing notice of the hearing decision, the administrative law 
judge may consider a new issue if he or she, before deciding the issue, 
provides you an opportunity to address it.
    (c) Collateral estoppel--issues previously decided. In one of our 
previous and final determinations or decisions involving you, but 
arising under a different title of the Act or under the Federal Coal 
Mine Health and Safety Act, we already may have decided a fact that is 
an issue before the administrative law judge. If this happens, the 
administrative law judge will not consider the issue again, but will 
accept the factual finding made in

[[Page 43614]]

the previous determination or decision, unless he or she reopens the 
previous determination or decision under subpart G of this part.


Sec.  405.330  Prehearing conferences.

    (a) (1) The administrative law judge, on his or her own or at your 
request, may decide to conduct a prehearing conference if he or she 
finds that such a conference would expedite the hearing or the decision 
on your claim. A prehearing conference normally will be held by 
telephone unless the administrative law judge decides that conducting 
it in another manner would be more efficient. We will give you 
reasonable notice of the time, place, and manner of the conference.
    (2) At the conference, the administrative law judge may consider 
matters such as simplifying or amending the issues, obtaining and 
submitting evidence, and any other matters that may expedite the 
hearing.
    (b) The administrative law judge may have a record of the 
prehearing conference made.
    (c) We will summarize in writing the actions taken as a result of 
the conference, unless the administrative law judge makes a statement 
on the record at the hearing summarizing them.
    (d) If neither you nor the person you designate to act as your 
representative appears at the prehearing conference, and under Sec.  
405.380(b), you do not have a good reason for failing to appear, we may 
dismiss the hearing request.


Sec.  405.331  Submitting evidence to an administrative law judge.

    You must submit with your request for hearing any evidence that you 
have available to you. You must submit all evidence that you wish to 
have considered at the hearing no later than 20 days before the date of 
the scheduled hearing, unless you show that you have good cause under 
Sec.  405.20(a) for submitting the evidence after this 20-day period, 
or you show that the late submitted evidence relates to a material 
change in your condition between the date set for submitting all 
evidence and the date of the hearing. Your failure to comply with this 
requirement may result in the evidence not being considered by the 
administrative law judge.


Sec.  405.332  Subpoenas.

    (a) When it is reasonably necessary for the full presentation of a 
claim, an administrative law judge may, on his or her own initiative or 
at your request, issue subpoenas for the appearance and testimony of 
witnesses and for the production of any documents that are material to 
an issue at the hearing.
    (b) To have documents or witnesses subpoenaed, you must file a 
written request for a subpoena with the administrative law judge at 
least 20 days before the hearing date. The written request must:
    (1) Give the names of the witnesses or documents to be produced;
    (2) Describe the address or location of the witnesses or documents 
with sufficient detail to find them;
    (3) State the important facts that the witness or document is 
expected to show; and
    (4) Indicate why these facts could not be shown without that 
witness or document.
    (c) We will pay the cost of issuing the subpoena and pay subpoenaed 
witnesses the same fees and mileage they would receive if they had been 
subpoenaed by a Federal district court.
    (d) Within 10 days of receipt of a subpoena, but no later than the 
date of the hearing, the person against whom the subpoena is directed 
may ask the administrative law judge to withdraw or limit the scope of 
the subpoena, setting forth the reasons why the subpoena should be 
withdrawn or why it should be limited in scope.
    (e) Upon failure of any person to comply with a subpoena, the 
Office of the General Counsel may seek enforcement of the subpoena 
under section 205(e) of the Act.


Sec.  405.333  Submitting documents other than evidence.

    All documents should clearly designate the name of the claimant and 
the last four digits of the claimant's social security number. All 
documents must be delivered or mailed to the administrative law judge 
within the time frames that he or she prescribes. Each document must be 
clear and legible to the fullest extent practicable. Documents must use 
type face no smaller than 12 point font.


Sec.  405.334  Prehearing statements.

    (a) At any time before the hearing begins, you may submit, or the 
administrative law judge may order you to submit, a prehearing 
statement as to why you are disabled.
    (b) A prehearing statement, unless otherwise ordered by the 
administrative law judge, must discuss briefly the following matters:
    (1) Issues involved in the proceeding,
    (2) Facts,
    (3) Witnesses,
    (4) The evidentiary and legal basis upon which your disability 
claim can be approved, and
    (5) Any other comments, suggestions, or information that might 
assist the administrative law judge in preparing for the hearing.


Sec.  405.340  Deciding a claim without a hearing before an 
administrative law judge.

    (a) Decision wholly favorable. If the evidence in the record 
supports a decision wholly in your favor, the administrative law judge 
may issue a decision without holding a hearing.
    (b) You do not wish to appear. The administrative law judge may 
decide a claim on the record and not conduct a hearing if--
    (1) You state in writing that you do not wish to appear at a 
hearing, or
    (2) You live outside the United States and you do not inform us 
that you want to appear.
    (c) When a hearing is not held, the administrative law judge will 
make a record of the material evidence, which, except for the 
transcript of the hearing, will contain the material described in Sec.  
405.360. The decision of the administrative law judge must be based on 
this record.


Sec.  405.350  Presenting evidence at a hearing before an 
administrative law judge.

    (a) The right to appear and present evidence. You have a right to 
appear before the administrative law judge, either in person or, when 
the conditions in Sec.  405.315(c) exist, by video teleconferencing, to 
present evidence and to state your position. You also may appear by 
means of a designated representative.
    (b) Admissible evidence. Subject to Sec.  405.331, the 
administrative law judge may receive any evidence at the hearing that 
he or she believes is relevant to your claim.
    (c) Witnesses at a hearing. Witnesses who appear at a hearing shall 
testify under oath or by affirmation, unless the administrative law 
judge finds an important reason to excuse them from taking an oath or 
making an affirmation. The administrative law judge, you, or your 
representative may ask the witnesses any questions material to the 
issues.


Sec.  405.351  Closing statements.

    You or your representative may present a closing statement to the 
administrative law judge. The administrative law judge may limit the 
time you may have to make a closing statement. The administrative law 
judge may also allow you to submit a brief within a time frame that he 
or she establishes.


Sec.  405.360  Official record.

    All hearings shall be recorded. All evidence upon which the 
administrative law judge relies for decision must be

[[Page 43615]]

contained in the record, either directly or by appropriate reference. 
The official record will include the applications, written statements, 
certificates, reports, affidavits, and other documents that were used 
in making the decision under review and any additional evidence or 
written statements that you submit. All exhibits introduced as evidence 
must be marked for identification and incorporated into the record. The 
official record of your claim will contain all of the marked exhibits 
and a verbatim recording of all testimony offered at the hearing; it 
also will include any prior initial determinations or decisions on your 
claim. The official record closes once the administrative law judge 
issues his or her decision regardless of whether it becomes our final 
decision.


Sec.  405.365  Consolidated hearing before an administrative law judge.

    (a) General. (1) We may hold a consolidated hearing if--
    (i) You have requested a hearing to decide your disability claim, 
and
    (ii) One or more of the issues to be considered at your hearing is 
the same as an issue involved in another claim you have pending before 
us.
    (2) If the administrative law judge consolidates the claims, he or 
she decides both claims, even if we have not yet made an initial 
determination or a reviewing official decision on the other claim.
    (b) Record, evidence, and decision. There will be a single record 
at a consolidated hearing. This means that the evidence introduced at 
the hearing becomes the evidence of record in each claim adjudicated. 
The administrative law judge may issue either a consolidated decision 
or separate decisions for each claim.


Sec.  405.366  Posthearing conferences.

    (a) The administrative law judge may decide on his or her own, or 
at your request, to hold a posthearing conference to facilitate the 
hearing decision. A posthearing conference normally will be held by 
telephone unless the administrative law judge decides that conducting 
it in another manner would be more efficient. We will give you 
reasonable notice of the time, place, and manner of the conference. A 
record of the conference will be made and placed in the hearing record.
    (b) If neither you nor the person you designate to act as your 
representative appears at the posthearing conference, and under Sec.  
405.380(b), you do not have a good reason for failing to appear, we may 
dismiss the hearing request.


Sec.  405.370  Decision by the administrative law judge.

    (a) The administrative law judge will make a decision based on all 
of the relevant evidence. The written decision will articulate, in 
clear and understandable language, the specific reasons for the 
decision, including an explanation as to why the administrative law 
judge agrees or disagrees with the rationale articulated in the 
reviewing official's decision.
    (b) During the hearing, in certain categories of claims that we 
identify in advance, the administrative law judge may orally articulate 
and enter into the record a wholly favorable decision. Within 5 days 
after the hearing, if there are no subsequent changes to the analysis 
in the oral decision, we will send you a written decision that explains 
why the administrative law judge agrees or disagrees with the rationale 
articulated in the reviewing official's decision and that incorporates 
such oral decision by reference. The administrative law judge will also 
include in the record a document that sets forth the key data, findings 
of fact, and narrative rationale for the decision. If there is a change 
in the administrative law judge's analysis or decision, we will send 
you a written decision that is consistent with paragraph (a) of this 
section. Upon written request, we will provide you a transcription of 
the oral decision.


Sec.  405.371  Notice of the decision of an administrative law judge.

    We will send a notice and the administrative law judge's decision 
to you at your last known address. The notice accompanying the decision 
will inform you whether or not the decision is our final decision. If 
it is our final decision, the notice will so state. If it is not our 
final decision, the notice will explain that the Decision Review Board 
has taken review of your claim.


Sec.  405.372  Finality of an administrative law judge's decision.

    The decision of the administrative law judge becomes our final 
decision and is binding on you unless--
    (a) The Decision Review Board reviews your claim,
    (b) An administrative law judge or the Decision Review Board 
revises the decision under subpart G of this part,
    (c) A Federal court reverses the decision or remands it for further 
administrative action, or
    (d) The administrative law judge considers new evidence under Sec.  
405.373.


Sec.  405.373  Requesting consideration of new and material evidence.

    (a) If the administrative law judge's decision is our final 
decision, he or she may consider new evidence submitted after the 
issuance of his or her decision if we have not referred your claim to 
the Decision Review Board. To obtain such consideration, you must 
request consideration by the administrative law judge within 10 days of 
the date you receive notice of the decision, and you must show that 
either:
    (1) There was an unforeseen and material change in your condition 
that occurred after the hearing and before the date of the 
administrative law judge's decision, or
    (2)(i) At the hearing, the administrative law judge agreed to allow 
you to submit the evidence within a certain time period after the 
hearing, and
    (ii) You had good cause within the meaning of Sec.  405.20(a)(3) 
for missing the administrative law judge's deadline for submitting the 
evidence.
    (b) If the administrative law judge's decision is not our final 
decision, you must submit your evidence to the Decision Review Board, 
and the Board will consider it if you make the showings required in 
paragraph (a) of this section.


Sec.  405.380  Dismissal of a request for a hearing before an 
administrative law judge.

    An administrative law judge may dismiss a request for a hearing:
    (a) At any time before notice of the hearing decision is mailed, 
when you withdraw the request orally on the record at the hearing or in 
writing.
    (b)(1) When neither you nor the person you designate to act as your 
representative appears at the hearing or at the pre- or post-hearing 
conferences, we previously notified you that your request for hearing 
may be dismissed if you did not appear, and you do not give a good 
reason for failing to appear, or
    (2) When neither you nor the person you designate to act as your 
representative appears at the hearing or at the pre- or post-hearing 
conferences, we had not previously notified you that your request for 
hearing may be dismissed if you did not appear, and within 10 days 
after we send you a notice asking why you did not appear, you do not 
give a good reason for failing to appear.
    (3) In determining whether you had a good reason under this 
paragraph (b), we will consider the factors described in Sec.  
405.20(a).
    (c) When we have made a previous determination or decision on your 
disability claim on the same facts and

[[Page 43616]]

on the same issue or issues, and this previous determination or 
decision has become final,
    (d) When you have no right to a hearing under Sec.  405.305,
    (e) When you did not request a hearing in time and we have not 
extended the time for requesting a hearing, or
    (4) When you die and your estate has not pursued your claim.


Sec.  405.381  Notice of dismissal of a request for a hearing before an 
administrative law judge.

    We will mail a written notice of the dismissal of the hearing 
request to you at your last known address. The notice will tell you 
that you may ask the administrative law judge to vacate the dismissal 
(see Sec.  405.382). The notice will also tell you that you may ask the 
Decision Review Board to review the dismissal if the administrative law 
judge does not vacate it.


Sec.  405.382  Vacating a dismissal of a request for a hearing before 
an administrative law judge.

    (a) If you ask in writing within 10 days after the date you receive 
the notice of dismissal, an administrative law judge may vacate a 
dismissal of a hearing request. The administrative law judge will 
vacate the dismissal if he or she finds that it was erroneous. We will 
notify you of whether the administrative law judge granted or denied 
your request.
    (b) If you are dissatisfied with the administrative law judge's 
action on your request to vacate the dismissal, you may request that 
the Decision Review Board vacate it. The Decision Review Board will not 
consider your request to vacate until the administrative law judge has 
ruled on your request. Your request to the Decision Review Board must 
be in writing and must be filed within 60 days after the date you 
receive the notice of the administrative law judge's action under 
paragraph (a) of this section.


Sec.  405.383  Effect of dismissal of a request for a hearing before an 
administrative law judge.

    The dismissal of a request for a hearing is binding and not subject 
to further review unless it is vacated by an administrative law judge 
or the Decision Review Board.

Subpart E--Decision Review Board


Sec.  405.401  Procedures before the Decision Review Board-general.

    This subpart describes the Decision Review Board and explains the 
procedures that we use when we refer certain decisions made by 
administrative law judges to the Board. It explains which claims the 
Board will review and the effects of that review on your claim. This 
subpart also describes how the Board may review the administrative law 
judge's dismissal of your hearing request and sets out the procedures 
that we use when you request that the Board vacate the administrative 
law judge's dismissal order.


Sec.  405.405  Decision Review Board.

    (a) The Board is comprised of administrative law judges and 
administrative appeals judges and is responsible for evaluating and 
reviewing certain decisions made by administrative law judges under 
this part before the decisions are effectuated.
    (b) As described in Sec.  405.410, the Board will review 
administrative law judge decisions. You may not appeal an 
administrative law judge's decision to the Board. The Board may affirm, 
modify, or reverse the administrative law judge's decision. It also may 
remand your claim to the administrative law judge for further action 
and decision.
    (c) The Board is also the final step in the administrative review 
process if the administrative law judge dismissed your request for a 
hearing under Sec.  405.380. As explained in Sec.  405.382, you must 
ask the administrative law judge to vacate his or her dismissal order 
before you may ask the Board to vacate the order.
    (d) The Board also may review your claim after the administrative 
law judge's decision has been effectuated to study our disability 
determination process. If the Board reviews your claim under this 
paragraph, it will not change the administrative law judge's decision 
in your claim, unless the Board determines that the rules in subpart G 
of this part apply. If the Board determines that subpart G applies, it 
may reopen and revise the administrative law judge's decision.
    (e) The Board also may perform other studies of the disability 
determination process, and it may make recommendations to the 
Commissioner regarding ways to improve the process.


Sec.  405.410  Selecting claims for Board review.

    (a) The Board may review your claim if the administrative law judge 
made a decision under Sec. Sec.  405.340 or 405.370, regardless of 
whether the administrative law judge's decision was unfavorable, 
partially favorable, or wholly favorable to you.
    (b)(1) The Board may use random sampling, the use of specific claim 
characteristics, a combination of these two methods, or other methods 
to select claims for review. For example, it may review claims that 
involve problematic issues or fact patterns that increase the 
likelihood of error or claims that involve the application of new 
policies, rules, or procedures. The Board will review both allowances 
and denials of benefits and will not review claims based on the 
identity of the administrative law judge who decided the claim.
    (2) If your claim is selected for review under paragraph (b)(1) of 
this section, the Board will notify you of that selection and include 
with the notice, the administrative law judge's decision.
    (c)(1) We also will refer your claim to the Board, for action under 
subpart G of this part without regard to the time limits therein, if, 
in the view of our effectuating component, the administrative law 
judge's decision cannot be effectuated because it contains a clerical 
error affecting the outcome of the claim, the decision is clearly 
inconsistent with the Act or our regulations, or the decision is 
unclear regarding a matter that affects the outcome of the claim.
    (2) Claims selected under paragraph (c)(1) of this section will be 
referred to the Board no later than 60 days from the date of the 
administrative law judge's decision.


Sec.  405.415  Notification by the Decision Review Board.

    When the Board reviews your claim, we will notify you. The notice 
will explain that the Board will review the decision and will complete 
its action on your claim within 90 days of the date you receive notice. 
The notice also will explain that if the Board does not complete its 
action on your claim within the 90 days, the administrative law judge's 
decision will become our final decision.


Sec.  405.420  Effect of Board review on the right to seek judicial 
review.

    (a)(1) Subject to the provisions of paragraph (a)(2) of this 
section, if the Board reviews your case, the administrative law judge's 
decision will not be our final decision.
    (2) If the Board does not complete its review within 90 days of the 
date you receive notice that the Board will review your claim, the 
administrative law judge's decision will become our final decision. If 
you are dissatisfied with this final decision, you may seek judicial 
review of the decision under section 205(g) of the Act within 60 days 
of the expiration of the 90-day time period. The Board will take no 
further action with respect to your claim, unless it determines that it 
can make a decision

[[Page 43617]]

that is fully favorable to you under the provisions of paragraph (a)(3) 
of this section.
    (3) If the administrative law judge's decision becomes our final 
decision under the provisions of paragraph (a)(2) of this section, but 
the Board determines that it can make a decision that is fully 
favorable to you, it will reopen the administrative law judge's 
decision in accordance with subpart G of this part without regard to 
the time limits therein, and revise it as appropriate. If you have 
already sought judicial review of the final decision under section 
205(g) of the Act, the Board will notify the Office of the General 
Counsel, which will then take appropriate action to request that the 
court remand the claim for the purpose of issuing the Board's decision.
    (b)(1) When the Board reviews your claim, it will either make our 
final decision or remand the claim to an administrative law judge for 
further proceedings consistent with the Board's remand order.
    (2) If the Board makes our final decision in your claim, it will 
send you notice of the decision, as explained in Sec.  405.445. If you 
are dissatisfied with the final decision, you may seek judicial review 
of the decision under section 205(g) of the Act.
    (3) If the Board remands your claim to an administrative law judge, 
the Board's remand order is not our final decision and you may not seek 
judicial review of the remand order under section 205(g) of the Act. 
The administrative law judge's decision after remand will become our 
final decision, unless the Board reviews the decision under Sec.  
405.410.
    (c) The Board's action under Sec.  405.382 on your request to 
vacate the administrative law judge's dismissal of your request for 
review is not subject to further review.


Sec.  405.425  Procedures before the Decision Review Board.

    (a) The Board may limit the issues that it considers. If the Board 
limits the issues that it considers, we will notify you of the issues 
that the Board will consider.
    (b)(1) The Board may ask you to submit a written statement, or you 
may ask, within 10 days of the date you receive notice of the Board's 
review, the Board's permission to submit a written statement. The 
written statement may not be longer than 3 pages, and the typeface must 
be no smaller than 12 point font. The written statement should briefly 
explain why you agree or disagree with the administrative law judge's 
decision, citing to specific facts in the record and relevant law.
    (2) The Board will not consider any written statements that you 
submit, unless the Board asked or allowed you to submit a statement 
under paragraph (b)(1) of this section. If you file a written statement 
in a claim and the Board has not asked or allowed you to submit one, 
the Board will not consider the written statement and will return it to 
you without making it a part of the record.
    (c)(1) If you request the Board to vacate the administrative law 
judge's dismissal of your request for a hearing, you may submit a 
written statement with the Board at the time that you ask the Board to 
vacate the dismissal order. The written statement may not be longer 
than 3 pages, and the typeface must be no smaller than 12 point font. 
The written statement should briefly explain why the request for a 
hearing should not have been dismissed. The written statement should 
cite to specific facts in the record and relevant law.
    (2) If you file a written statement with the Board after you 
request it to vacate the dismissal, the Board will not consider your 
written statement and will return it to you without making it part of 
the record.
    (d) In conducting its review of your claim, the Board may obtain 
advice from a medical, psychological, or vocational expert affiliated 
with the national network. If the Board obtains such advice, we will 
provide you with a copy of it and place the advice into the record.


Sec.  405.430  Record before the Decision Review Board.

    (a) Subject to the provisions of Sec. Sec.  405.373(b) and 
405.425(d), in claims reviewed by the Board, the record is closed as of 
the date of the administrative law judge's decision. That means that 
the Board will base its action on your claim on the same evidence that 
was before the administrative law judge. When it reviews a claim, the 
Board will consider only that evidence that was in the record before 
the administrative law judge.
    (b) When you request the Board to review the administrative law 
judge's dismissal of your claim, you may submit additional evidence, 
but the Board will accept only evidence that is relevant to the 
dismissal issue. All other evidence will be returned to you.


Sec.  405.440  Actions that the Decision Review Board may take.

    The Board may review the administrative law judge's findings of 
fact and application of the law. It will apply the substantial evidence 
standard in reviewing the findings of fact, but review de novo the 
application of the law. The Board will take one of the following 
actions:
    (a) Where there is an error of law, issue its own decision which 
affirms, reverses, or modifies the administrative law judge's decision;
    (b) Where the factual findings are unsupported by substantial 
evidence, remand your claim to the administrative law judge for further 
proceedings consistent with the Board's order. If the Board remands 
your claim to the administrative law judge for further proceedings, the 
administrative law judge must take any action that is specified by the 
Board in its remand order and may take any additional action that is 
not inconsistent with the Board's remand order;
    (c) Vacate the administrative law judge's dismissal order. If the 
Board issues an order vacating the administrative law judge's dismissal 
order, it will remand the claim to the administrative law judge for 
further proceedings consistent with the Board's order, or
    (d) Decline to vacate the dismissal order.


Sec.  405.445  Notification of the Decision Review Board's action.

    We will send notice of the Board's action to you at your last known 
address. The notice will articulate, in clear and understandable 
language, the reasons for the Board's action. If the Board issues a 
decision, it will articulate its rationale for its decision and, the 
notice will also explain how to seek judicial review. If the Board 
issues a remand order, the notice will explain that the remand order is 
not our final decision.


Sec.  405.450  Effect of the Decision Review Board's action.

    (a) The Board's decision is binding unless you file an action in 
Federal district court, or the decision is revised under subpart G of 
this part.
    (b) The administrative law judge's decision is binding if the Board 
does not complete its action within 90 days of the date your receive 
notice that the Board will review your claim, unless you file an action 
in Federal district court, or the decision is revised under subpart G 
of this part.
    (c) The Board's action to remand your claim to an administrative 
law judge is binding and not subject to judicial review.
    (d) The Board's action on a request to vacate an administrative law 
judge's dismissal order is binding and not subject to further review.

[[Page 43618]]

Subpart F--Judicial Review


Sec.  405.501  Judicial review.

    You may file an action in a Federal district court within 60 days 
of the date our decision becomes final and judicially reviewable.


Sec.  405.505  Extension of time to file a civil action.

    If you have received our final decision, you may request that we 
extend the time for seeking judicial review in a Federal district 
court. Your request must be in writing and explain why the action was 
not filed, or cannot be filed, on time. The request must be filed with 
the Board. If you show that you had good cause for missing the 
deadline, we will extend the time period. We will use the standards in 
Sec.  405.20 to determine if you have good cause for an extension of 
time.


Sec.  405.510  Claims remanded by a Federal court.

    When a Federal court remands a claim decided under this part to us 
for further consideration, the Board may make a decision based upon the 
evidence in the record, or it may remand the claim to an administrative 
law judge. If the Board remands a claim to an administrative law judge, 
it will send you a notice.


Sec.  405.515  Application of circuit court law.

    We will follow the procedures in Sec. Sec.  404.985 and 416.1485 of 
this chapter for claims decided under this part.

Subpart G--Reopening and Revising Determinations and Decisions


Sec.  405.601  Reopening and revising determinations and decisions.

    (a) General. If you are dissatisfied with a determination or 
decision made in the administrative review process, but do not request 
further review within the stated time period, you lose your right to 
further review, and that determination or decision becomes final. 
However, we may reopen and revise a determination or a decision made in 
your claim which is otherwise final and binding.
    (b) Procedure for reopening and revision. We may, or you make ask 
us to, reopen a final determination or decision on your claim. If we 
reopen a determination or decision, we may revise it.


Sec.  405.605  Conditions for reopening.

    We may reopen a determination, revised determination, decision, or 
revised decision:
    (a) Within 6 months of our final action on your claim if we find:
    (1) A clerical error in the computation or recomputation of 
benefits was made, or
    (2) The evidence that was considered in making the determination or 
decision clearly shows on its face that an error was made.
    (b) At any time if--
    (1) It was obtained by fraud or similar fault (see Sec.  
416.1488(c) of this chapter for factors which we take into account in 
determining fraud or similar fault),
    (2) Another person files a claim on the same earnings record and 
allowance of the claim adversely affects your claim,
    (3) A person previously determined to be dead, and on whose 
earnings record your entitlement is based, is later found to be alive,
    (4) It is wholly or partially unfavorable to you, but only to 
correct clerical error or an error that appears on the face of the 
evidence that was considered when the determination or decision was 
made,
    (5) It finds that you are entitled to monthly benefits based on the 
earnings of a deceased person, and it is later established that:
    (i) You were convicted of a felony or an act in the nature of a 
felony for intentionally causing that person's death, or
    (ii) If you were subject to the juvenile justice system, you were 
found by a court of competent jurisdiction to have intentionally caused 
that person's death by committing an act which, if committed by an 
adult, would have been considered a felony or an act in the nature of a 
felony, or
    (6) It is incorrect because--
    (i) You were convicted of a crime that affected your right to 
receive benefits or your entitlement to a period of disability, or
    (ii) Your conviction of a crime that affected your right to receive 
benefits or your entitlement to a period of disability is overturned.
    (c) We will not find good cause to reopen the determination or 
decision if the only reason for requesting the reopening is:
    (1) A change of legal interpretation or administrative ruling upon 
which the determination or decision was made, or
    (2) The existence of new evidence that was not considered in making 
the determination or decision.


Sec.  405.610  Late completion of timely investigation.

    We may reopen and revise a determination or decision after the 
applicable time period in Sec.  405.605(a) expires if we begin an 
investigation into whether to revise the determination or decision 
before the applicable time period expires. We may begin the 
investigation either on our own or at your request. The investigation 
is a process of gathering facts after a determination or decision has 
been reopened to determine if we should revise it.
    (a) If we have diligently pursued the investigation to its 
conclusion, we may revise the determination or decision. The revision 
may be favorable or unfavorable to you. ``Diligently pursued'' means 
that in light of the facts and circumstances of a particular claim, the 
necessary action was undertaken and carried out as promptly as the 
circumstances permitted. Diligent pursuit will be presumed to have been 
met if we conclude the investigation and if necessary, revise the 
determination or decision within 6 months from the date we began the 
investigation.
    (b) If we have not diligently pursued the investigation to its 
conclusion, we will revise the determination or decision if a revision 
is applicable and if it will be favorable to you. We will not revise 
the determination or decision if it will be unfavorable to you.


Sec.  405.615  Notice of revised determination or decision.

    (a) When we revise a determination or decision, we will mail notice 
of the revision to you at your last known address. The notice will 
state the basis for the revision and the effect of the revision. The 
notice will also inform you of your right to further review.
    (b) If an administrative law judge or the Decision Review Board 
proposes to revise a decision, and the revision would be based on 
evidence not included in the record on which the prior decision was 
based, you will be notified, in writing, of the proposed action and of 
your right to request that a hearing be held before any further action 
is taken.
    (c) If an administrative law judge or the Decision Review Board 
proposes to revise a decision, and the revision would be based only on 
evidence included in the record on which the prior decision was based, 
you will be notified, in writing, of the proposed action.


Sec.  405.620  Effect of revised determination or decision.

    A revised determination or decision is binding unless--
    (a) You file a written request for review by a reviewing official 
or a hearing before an administrative law judge, as appropriate,
    (b) The Decision Review Board reviews the revised decision, or

[[Page 43619]]

    (c) The revised determination or decision is further revised.


Sec.  405.625  Time and place to request a hearing on a revised 
determination or decision.

    You may request, as appropriate, further review or a hearing on the 
revision by filing a request in writing at one of our offices within 60 
days after the date you receive notice of the revision. If you have a 
disability claim under title II of the Act, you may also file the 
request at the Veterans Administration Regional Office in the 
Philippines, or if you have 10 or more years of service in the railroad 
industry, an office of the Railroad Retirement Board. Further review or 
a hearing will be held on the revision according to the rules of this 
subpart.


Sec.  405.630  Finality of findings when later claim is filed on same 
earnings record.

    If two claims for benefits filed under title II of the Social 
Security Act are filed on the same earnings records, findings of fact 
made in a determination on the first claim may be revised in 
determining or deciding the second claim, even though the time limit 
for revising the findings made in the first claim has passed.

Subpart H--Expedited Appeals Process for Constitutional Issues


Sec.  405.701  Expedited appeals process--general.

    By using the expedited appeals process you may go directly to a 
Federal district court without first completing the administrative 
review process that is generally required before the court will hear 
your claim.


Sec.  405.705  When the expedited appeals process may be used.

    If you have filed a disability claim, you may use the expedited 
appeals process if all of the following requirements are met:
    (a) You have received an initial determination and a decision by a 
reviewing official, but an administrative law judge has not made a 
decision;
    (b) You have submitted a written request for the expedited appeals 
process, and
    (c) You have our written agreement to use the expedited appeals 
process as required in Sec.  405.715.


Sec.  405.710  How to request an expedited appeal.

    (a) Time limit for filing request. If you wish to use the expedited 
appeals process, you must request it--
    (1) No later than 60 days after the date you receive notice of the 
reviewing official's decision (or within the extended time period if we 
extend the time as provided in paragraph (c) of this section), or
    (2) At any time after you have filed a timely request for a hearing 
but before you receive notice of the administrative law judge's 
decision.
    (b) Place for filing request. You should file a written request for 
an expedited appeal at one of our offices. If you have a disability 
claim under title II of the Act, you may also file the request at the 
Veterans Administration Regional Office in the Philippines, or if you 
have 10 or more years of service in the railroad industry, an office of 
the Railroad Retirement Board.
    (c) Extension of time to request expedited appeals process. If you 
want to use the expedited appeals process but do not request it in 
time, you may ask for more time to submit your request. Your request 
for an extension of time must be in writing and must give the reasons 
why the request for the expedited appeals process was not filed in 
time. If you show that you had good cause for missing the deadline, the 
time period will be extended. To determine whether good cause exists, 
we use the standards explained in Sec.  405.20.


Sec.  405.715  Agreement in expedited appeals process.

    If you meet all the requirements necessary for using the expedited 
appeals process, our authorized representative shall prepare an 
agreement. The agreement must be signed by you and by our authorized 
representative. The agreement must provide that--
    (a) The facts in your claim are not in dispute;
    (b) The sole issue in dispute is whether a provision of the Act 
that applies to your claim is unconstitutional;
    (c) Except for your belief that a provision of the Act is 
unconstitutional, you agree with our interpretation of the law;
    (d) If the provision of the Act that you believe is 
unconstitutional were not applied to your claim, your claim would be 
allowed, and
    (e) Our decision is final for the purpose of seeking judicial 
review.


Sec.  405.720  Notice of agreement to expedite your appeal.

    If we agree that you can use the expedited appeals process, a 
signed copy of the agreement will be mailed to you and will constitute 
notice. If you do not meet all of the requirements necessary to use the 
expedited appeals process, we will advise you that your request to use 
this process is denied and that your request will be considered as a 
request for a hearing, if you have not already requested a hearing.


Sec.  405.725  Effect of expedited appeals process agreement.

    After an expedited appeals process agreement is signed, you will 
not need to complete the remaining steps of the administrative review 
process. Instead, you may file an action in the Federal district court 
in the district where you reside. You must file within 60 days after 
the date you receive notice that the agreement has been signed by our 
authorized representative.

Subpart I--Quick Disability Determination Unit and Other State 
Agency Responsibilities


Sec.  405.801  Purpose and scope.

    This subpart describes the procedures the State agency must follow 
in order to make quick disability determinations. It outlines our 
responsibilities and those of the State agency and describes the 
processing standard the State agency's Quick Disability Determination 
Unit must meet. This subpart describes what action we will take if the 
State agency does not meet the quick disability determination 
processing standard. It supplements, and does not replace, the 
standards of Subpart Q of part 404 or Subpart J of part 416 of this 
chapter.


Sec.  405.805  Our and the State agency's basic responsibilities.

    (a) General. We will work with the State to provide and maintain an 
effective system for processing quick disability determinations. We 
will provide program standards, leadership, and oversight. We do not 
intend to become involved in the State's ongoing management of Quick 
Disability Determination Units, except as is necessary and in 
accordance with these regulations. The State will comply with our 
regulations and other written guidelines.
    (b) Our responsibilities. In addition to the responsibilities we 
have under Sec. Sec.  404.1603 and 416.1003 of this chapter, we will:
    (1) As described in Sec.  405.15, provide medical, psychological, 
and vocational expertise needed for adjudication of a claim if such 
expertise is not otherwise available to the State, and
    (2) Pay the established Federal rate for the State agency's use of 
any medical, psychological, or vocational expert affiliated with the 
national network.
    (c) Responsibilities of the State. (1) In addition to the 
responsibilities the State has under subpart Q of part 404 or subpart J 
of part 416 of this chapter, any

[[Page 43620]]

State that performs the quick disability determination function will 
organize a separate Quick Disability Determination Unit that will 
comply with the requirements set out in this subpart.
    (2) In all States to which this part applies, the medical, 
psychological, and vocational experts employed by or under contract 
with the State agency must meet the Commissioner's qualification 
standards prescribed under Sec.  405.15 in order for the State agency 
to receive reimbursement for the experts' salaries or the cost of their 
services.


Sec.  405.810  Deemed notice that the State wishes to perform the quick 
disability determination function.

    Any State that currently performs the disability determination 
function under subpart Q of part 404 or subpart J of part 416 of this 
chapter will be deemed to have given us notice that it wishes to 
perform the quick disability determination function.


Sec.  405.815  Making quick disability determinations.

    The quick disability determination will be made as described in 
subpart B of this part.


Sec.  405.820  Notifying claimants of the quick disability 
determination.

    The State agency will prepare a notice to the claimant using clear 
and understandable language when it makes a quick disability 
determination.


Sec.  405.825  Processing standard.

    The processing performance standard for quick disability 
determinations is processing 98 percent of the claims that we refer to 
the Quick Disability Determination Unit within 20 days. This standard 
applies to all disability claims identified for quick determination.


Sec.  405.830  How and when we determine whether the processing 
standard is met.

    (a) How we determine processing time. For all quick disability 
determinations, we calculate the number of days, from the day the claim 
is received in the State agency until the day the claim is released to 
us by the State agency.
    (b) Frequency of review. We will monitor the processing time for 
quick disability determinations on a quarterly basis separately from 
the other State disability determinations. We will determine whether or 
not the processing standard has been met at the end of each quarter of 
each year.


Sec.  405.835  Action we will take if a State agency does not meet the 
quick disability determination processing time standard.

    If for two or more consecutive calendar quarters a State agency 
falls below the quick disability determination processing standard 
described in Sec.  405.825, we will notify the State agency that we 
propose to find it has substantially failed to comply with our 
standards regarding quick disability determinations. We also will 
advise the State agency that it may request a hearing on that issue. 
After giving the State notice and an opportunity for a hearing, if it 
is found that a State agency has substantially failed to make quick 
disability determinations consistent with the Act, our regulations, and 
other written guidelines, we will assume responsibility for performing 
the quick disability determination function. We will not provide 
performance support for State agency Quick Disability Determination 
Units prior to proposing to find that the State agency has failed to 
comply with our standards regarding quick disability determinations.


Sec.  405.840  Good cause for not following the Act, our regulations, 
and other written guidelines.

    We will follow the procedures in Sec. Sec.  404.1671 and 416.1071 
of this chapter to determine if the State has good cause for not 
following the Act, our regulations, or other written guidelines.


Sec.  405.845  Hearings and appeals.

    We will follow the provisions of Sec. Sec.  404.1675 through 
404.1683, and Sec. Sec.  416.1075 through 416.1083 of this chapter when 
we propose to find that the State agency has substantially failed to 
comply with our standards regarding quick disability determinations.


Sec.  405.850  Assumption of the quick disability determination 
function when we make a finding of substantial failure.

    (a) Notice to State. When we find that substantial failure exists, 
we will notify the State in writing that we will assume responsibility 
for making quick disability determinations, and the date on which the 
assumption will be effective.
    (b) Effective date of assumption. The date of assumption of the 
disability determination function from a State agency will not be 
earlier than 180 days after our finding of substantial failure, and not 
before we have complied with the requirements of Sec. Sec.  404.1692 
and 416.1092 of this chapter.
    (c) Other regulations. The provisions of Sec. Sec.  404.1691, 
404.1693, 404.1694, 416.1091, 416.1093 and 416.1094 of this chapter 
apply under this subpart to the same extent that they apply under 
subpart Q of part 404 and subpart J of part 416 of this chapter.

Subpart J--Payment of Certain Travel Expenses


Sec.  405.901  Reimbursement of certain travel expenses.

    When you file a disability claim, you may incur certain travel 
expenses that may be reimbursable. We use Sec. Sec.  404.999a through 
404.999d of this chapter for title II claims and Sec. Sec.  416.1495 
through 416.1499 of this chapter for title XVI claims in determining 
reimbursable expenses and for explaining how and where you may request 
reimbursement.

PART 416--SUPPLEMENTAL SECURITY INCOME FOR THE AGED, BLIND, AND 
DISABLED

Subpart I--[Amended]

    21. The authority citation for subpart I of part 416 continues to 
read as follows:

    Authority: Secs. 702(a)(5), 1611, 1614, 1619, 1631(a), (c), and 
(d)(1), and 1633 of the Social Security Act (42 U.S.C. 902(a)(5), 
1382, 1382c, 1382h, 1383(a), (c), and (d)(1), and 1383b); secs. 4(c) 
and 5, 6(c)-(e), 14(a), and 15, Pub. L. 98-460, 98 Stat. 1794, 1801, 
1802, and 1808 (42 U.S.C. 421 note, 423 note, 1382h note).

Subpart I--[Amended]

    22. Amend Sec.  416.902 by revising the definition of nonexamining 
source to read as follows:


Sec.  416.902  General definitions and terms for this subpart.

* * * * *
    Nonexamining source means a physician, psychologist, or other 
acceptable medical source who has not examined you but provides a 
medical or other opinion in your case. At the administrative law judge 
hearing and Appeals Council levels of the administrative review 
process, and at the reviewing official, administrative law judge and 
Decision Review Board levels of the administrative review process in 
claims adjudicated under the procedures in part 405 of this chapter, it 
includes State agency medical and psychological consultants, other 
program physicians and psychologists, and medical experts we consult. 
See Sec.  416.927.
* * * * *
    23. Amend Sec.  416.903 by adding a sixth sentence to paragraph 
(a), and by removing the parenthetical statement after the first 
sentence of paragraph (e), to read as follows:

[[Page 43621]]

Sec.  416.903  Who makes disability and blindness determinations.

    (a) * * * Subpart I of part 405 of this chapter contains additional 
rules that the States must follow in making disability and blindness 
determinations in cases adjudicated under the procedures in part 405 of 
this chapter.
* * * * *
    24. Amend Sec.  416.912 by revising paragraph (b)(6) and the second 
sentence of paragraph (c) to read as follows:


Sec.  416.912  Evidence.

* * * * *
    (b) * * *
    (6) At the administrative law judge and Appeals Council levels, and 
at the reviewing official, administrative law judge and Decision Review 
Board levels in claims adjudicated under the procedures in part 405 of 
this chapter, findings, other than the ultimate determination about 
whether you are disabled, made by State agency medical or psychological 
consultants and other program physicians or psychologists, and opinions 
expressed by medical experts we consult based on their review of the 
evidence in your case record. See Sec. Sec.  416.927(f)(2) and (f)(3).
    (c) * * * You must provide evidence showing how your impairment(s) 
affect(s) your functioning during the time you say that you are 
disabled, and any other information that we need to decide your claim, 
including evidence that you consider to be unfavorable to your claim. * 
* *
* * * * *
    25. Amend Sec.  416.913 by revising the first sentence of paragraph 
(c) to read as follows:


Sec.  416.913  Medical and other evidence of your impairment(s).

* * * * *
    (c) * * * At the administrative law judge and Appeals Council 
levels, and at the reviewing official, administrative law judge and 
Decision Review Board levels in claims adjudicated under the procedures 
in part 405 of this chapter, we will consider residual functional 
capacity assessments made by State agency medical and psychological 
consultants and other program physicians and psychologists to be 
``statements about what you can still do'' made by nonexamining 
physicians and psychologists based on their review of the evidence in 
the case record. * * *
* * * * *
    26. Amend Sec.  416.919k by revising paragraph (a) to read as 
follows:


Sec.  416.919k  Purchase of medical examinations, laboratory tests, and 
other services.

* * * * *
    (a) Subject to the provisions of Sec.  405.15 of this chapter in 
claims adjudicated under the procedures in part 405 of this chapter, 
the rate of payment to be used for purchasing medical or other services 
necessary to make determinations of disability may not exceed the 
highest rate paid by Federal or public agencies in the State for the 
same or similar types of service. See Sec. Sec.  416.1024 and 416.1026.
* * * * *
    27. Amend Sec.  416.919m by revising the third sentence to read as 
follows:


Sec.  416.919m  Diagnostic tests or procedures.

    * * * A State agency medical consultant, or a medical expert (as 
defined in Sec.  405.5 of this chapter) in claims adjudicated under the 
procedures in part 405 of this chapter, must approve the ordering of 
any diagnostic test or procedure when there is a chance it may involve 
significant risk. * * *
    28. Amend Sec.  416.919s by revising paragraph (c) to read as 
follows:


Sec.  416.919s  Authorizing and monitoring the consultative 
examination.

* * * * *
    (c) Subject to the provisions of Sec.  405.15 of this chapter in 
claims adjudicated under the procedures in part 405 of this chapter, 
and consistent with Federal and State laws, the State agency 
administrator will work to achieve appropriate rates of payment for 
purchased medical services.
* * * * *
    29. Amend Sec.  416.920a by revising the third sentence of 
paragraph (d)(2), adding a new fourth sentence to paragraph (d)(2) and 
revising paragraph (e) to read as follows:


Sec.  416.920a  Evaluation of mental impairments.

* * * * *
    (d) * * *
    (2) * * * We will record the presence or absence of the criteria 
and the rating of the degree of functional limitation on a standard 
document at the initial and reconsideration levels of the 
administrative review process. We will record the presence or absence 
of the criteria and the rating of the degree of functional limitation 
in the decision at the administrative law judge hearing and Appeals 
Council levels (in cases in which the Appeals Council issues a 
decision), and in the decision at the reviewing official, 
administrative law judge and the Decision Review Board levels in claims 
adjudicated under the procedures in part 405 of this chapter. * * *
* * * * *
    (e) Documenting application of the technique. At the initial and 
reconsideration levels of the administrative review process, we will 
complete a standard document to record how we applied the technique. At 
the administrative law judge hearing and Appeals Council levels (in 
cases in which the Appeals Council issues a decision), and at the 
reviewing official, administrative law judge and the Decision Review 
Board levels in claims adjudicated under the procedures in part 405 of 
this chapter, we will document application of the technique in the 
decision.
    (1) At the initial and reconsideration levels, except in cases in 
which a disability hearing officer makes the reconsideration 
determination, our medical or psychological consultant has overall 
responsibility for assessing medical severity. At the initial level in 
claims adjudicated under the procedures in part 405 of this chapter, a 
medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) has overall responsibility for assessing medical severity. The 
State agency disability examiner may assist in preparing the standard 
document. However, our medical or psychological consultant (or the 
medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) in claims adjudicated under the procedures in part 405 of this 
chapter) must review and sign the document to attest that it is 
complete and that he or she is responsible for its content, including 
the findings of fact and any discussion of supporting evidence. When a 
disability hearing officer makes a reconsideration determination, the 
determination must document application of the technique, incorporating 
the disability hearing officer's pertinent findings and conclusions 
based on this technique.
    (2) At the administrative law judge hearing and Appeals Council 
levels, and at the reviewing official, administrative law judge and the 
Decision Review Board levels in claims adjudicated under the procedures 
in part 405 of this chapter, the written decision must incorporate the 
pertinent findings and conclusions based on the technique. The decision 
must show the significant history, including examination and laboratory 
findings, and the functional limitations that were considered in 
reaching a conclusion about the severity of the mental impairment(s). 
The

[[Page 43622]]

decision must include a specific finding as to the degree of limitation 
in each of the functional areas described in paragraph (c) of this 
section.
    (3) Except in cases adjudicated under the procedures in part 405 of 
this chapter, if the administrative law judge requires the services of 
a medical expert to assist in applying the technique but such services 
are unavailable, the administrative law judge may return the case to 
the State agency or the appropriate Federal component, using the rules 
in Sec.  416.1441, for completion of the standard document. If, after 
reviewing the case file and completing the standard document, the State 
agency or Federal component concludes that a determination favorable to 
you is warranted, it will process the case using the rules found in 
Sec.  416.1441(d) or (e). If, after reviewing the case file and 
completing the standard document, the State agency or Federal component 
concludes that a determination favorable to you is not warranted, it 
will send the completed standard document and the case to the 
administrative law judge for further proceedings and a decision.
    30. Amend Sec.  416.924 by revising the text of paragraph (g) to 
read as follows:


Sec.  416.924  How we determine disability for children.

* * * * *
    (g) * * * When we make an initial or reconsidered determination 
whether you are disabled under this section or whether your disability 
continues under Sec.  416.994a (except when a disability hearing 
officer makes the reconsideration determination), we will complete a 
standard form, Form SSA-538, Childhood Disability Evaluation Form. We 
will also complete the standard form when we make an initial 
determination in claims adjudicated under the procedures in part 405 of 
this chapter. The form outlines the steps of the sequential evaluation 
process for individuals who have not attained age 18. The State agency 
medical or psychological consultant (see Sec.  416.1016) or other 
designee of the Commissioner, or the medical or psychological expert 
(as defined in Sec.  405.5 of this chapter) in claims adjudicated under 
the procedures in part 405 of this chapter, has overall responsibility 
for the content of the form and must sign the form to attest that it is 
complete and that he or she is responsible for its content, including 
the findings of fact and any discussion of supporting evidence. 
Disability hearing officers, administrative law judges, and the 
administrative appeals judges on the Appeals Council (when the Appeals 
Council makes a decision) will not complete the form but will indicate 
their findings at each step of the sequential evaluation process in 
their determinations or decisions. In addition, in claims adjudicated 
under the procedures in part 405 of this chapter, reviewing officials, 
administrative law judge and the Decision Review Board will not 
complete the form but will indicate their findings at each step of the 
sequential evaluation process in their decisions.
    31. Amend Sec.  416.926 by revising the first sentence of paragraph 
(c) and paragraph (d) to read as follows:


Sec.  416.926  Medical equivalence for adults and children.

* * * * *
    (c) * * * A medical or psychological consultant designated by the 
Commissioner includes any medical or psychological consultant employed 
or engaged to make medical judgments by the Social Security 
Administration, the Railroad Retirement Board, or a State agency 
authorized to make disability determinations, and includes a medical or 
psychological expert (as defined in Sec.  405.5 of this chapter) in 
claims adjudicated under the procedures in part 405 of this chapter. * 
* *
    (d) Responsibility for determining medical equivalence. In cases 
where the State agency or other designee of the Commissioner makes the 
initial or reconsideration disability determination, a State agency 
medical or psychological consultant or other designee of the 
Commissioner (see Sec.  416.1016) has the overall responsibility for 
determining medical equivalence. In claims adjudicated at the initial 
level under the procedures in part 405 of this chapter, the medical or 
psychological expert (as defined in Sec.  405.5 of this chapter) has 
the overall responsibility for determining medical equivalence. For 
cases in the disability hearing process or otherwise decided by a 
disability hearing officer, the responsibility for determining medical 
equivalence rests with either the disability hearing officer or, if the 
disability hearing officer's reconsideration determination is changed 
under Sec.  416.1418, with the Associate Commissioner for Disability 
Programs or his or her delegate. For cases at the Administrative Law 
Judge or Appeals Council level, the responsibility for deciding medical 
equivalence rests with the Administrative Law Judge or Appeals Council. 
In claims adjudicated at the reviewing official, administrative law 
judge and the Decision Review Board levels under the procedures in part 
405 of this chapter, the responsibility for deciding medical 
equivalence rests with the reviewing official, administrative law 
judge, or Decision Review Board.
    32. Amend Sec.  416.926a by revising paragraph (n) to read as 
follows:


Sec.  416.926a  Functional equivalence for children.

* * * * *
    (n) Responsibility for determining functional equivalence. In cases 
where the State agency or other designee of the Commissioner makes the 
initial or reconsideration disability determination, a State agency 
medical or psychological consultant or other designee of the 
Commissioner (see Sec.  416.1016) has the overall responsibility for 
determining functional equivalence. In claims adjudicated at the 
initial level under the procedures in part 405 of this chapter, the 
medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) has the overall responsibility for determining functional 
equivalence. For cases in the disability hearing process or otherwise 
decided by a disability hearing officer, the responsibility for 
determining functional equivalence rests with either the disability 
hearing officer or, if the disability hearing officer's reconsideration 
determination is changed under Sec.  416.1418, with the Associate 
Commissioner for Disability Programs or his or her delegate. For cases 
at the Administrative Law Judge or Appeals Council level, the 
responsibility for deciding functional equivalence rests with the 
Administrative Law Judge or Appeals Council. In claims adjudicated at 
the reviewing official, administrative law judge and the Decision 
Review Board levels under the procedures in part 405 of this chapter, 
the responsibility for deciding functional equivalence rests with the 
reviewing official, administrative law judge, or Decision Review Board.
    33. Amend Sec.  416.927 by revising paragraph (f)(1) and by adding 
paragraph (f)(4) to read as follows:


Sec.  416.927  Evaluating opinion evidence.

* * * * *
    (f) * * *
    (1) In claims adjudicated by the State agency, a State agency 
medical or psychological consultant (or a medical or psychological 
expert (as defined in Sec.  405.5 of this chapter) in claims 
adjudicated under the procedures in part 405 of this chapter) will 
consider the evidence in your case record and make findings of fact 
about the medical issues, including, but not limited to, the

[[Page 43623]]

existence and severity of your impairment(s), the existence and 
severity of your symptoms, whether your impairment(s) meets or equals 
the requirements for any impairment listed in appendix 1 to subpart P 
of part 404 of this chapter, and your residual functional capacity. 
These administrative findings of fact are based on the evidence in your 
case record but are not themselves evidence at these steps.
* * * * *
    (4) In claims adjudicated under the procedures in part 405 of this 
chapter at the reviewing official, administrative law judge and the 
Decision Review Board levels of the administrative review process, we 
will follow the same rules for considering opinion evidence that 
administrative law judges follow under this section.
    34. Amend Sec.  416.929 by revising the third and fifth sentences 
of paragraph (b) to read as follows:


Sec.  416.929  How we evaluate symptoms, including pain.

* * * * *
    (b) * * * In cases decided by a State agency (except in disability 
hearings), a State agency medical or psychological consultant, a 
medical or psychological consultant designated by the Commissioner, or 
a medical or psychological expert (as defined in Sec.  405.5 of this 
chapter) in claims adjudicated under the procedures in part 405 of this 
chapter, directly participates in determining whether your medically 
determinable impairment(s) could reasonably be expected to produce your 
alleged symptoms. * * * At the administrative law judge hearing or 
Appeals Council level of the administrative review process, or at the 
reviewing official, administrative law judge and the Decision Review 
Board levels in claims adjudicated under the procedures in part 405 of 
this chapter, the adjudicator(s) may ask for and consider the opinion 
of a medical or psychological expert concerning whether your 
impairment(s) could reasonably be expected to produce your alleged 
symptoms. * * *
* * * * *
    35. Amend Sec.  416.946 by revising the text of paragraph (a) and 
by adding a new paragraph (d) to read as follows:


Sec.  416.946  Responsibility for assessing your residual functional 
capacity.

    (a) * * * When a State agency makes the disability determination, a 
State agency medical or psychological consultant(s) (or a medical or 
psychological expert (as defined in Sec.  405.5 of this chapter) in 
claims adjudicated under the procedures in part 405 of this chapter) is 
responsible for assessing your residual functional capacity.
* * * * *
    (d) Responsibility for assessing residual functional capacity in 
claims adjudicated under part 405 of this chapter. In claims 
adjudicated under the procedures in part 405 of this chapter at the 
reviewing official, administrative law judge and the Decision Review 
Board levels of the administrative review process, the reviewing 
official, the administrative law judge or the Decision Review Board is 
responsible for assessing your residual functional capacity.

Subpart J--[Amended]

    36. The authority citation for subpart J of part 416 continues to 
read as follows:

    Authority: Secs. 702(a)(5)1614, 1631, and 1633 of the Social 
Security Act (42 U.S.C. 902(a)(5), 1382c, 1383, and 1383b).

    37. Amend Sec.  416.1001 by adding a new third sentence to the 
introductory text to read as follows:


Sec.  416.1001  Purpose and scope.

    * * * Subpart I of part 405 of this chapter contains additional 
rules that the States must follow in making disability and blindness 
determinations in cases adjudicated under the procedures in part 405 of 
this chapter.
* * * * *
    38. Amend Sec.  416.1016 by adding a new third sentence in 
paragraph (b) and a new paragraph (e)(4) to read as follows:


Sec.  416.1016  Medical or psychological consultants.

* * * * *
    (b) * * * In claims adjudicated under the procedures in part 405 of 
this chapter, medical experts employed by or under contract with the 
State agencies must meet the qualification standards prescribed by the 
Commissioner.
* * * * *
    (e) * * *
    (4) In claims adjudicated under the procedures in part 405 of this 
chapter, psychological experts employed by or under contract with the 
State agencies must meet the qualification standards prescribed by the 
Commissioner.
* * * * *
    39. Amend Sec.  416.1024 by revising the first sentence to read as 
follows:


Sec.  416.1024  Medical and other purchased services.

    Subject to the provisions of Sec.  405.15 of this chapter in claims 
adjudicated under the procedures in part 405 of this chapter, the State 
will determine the rates of payment to be used for purchasing medical 
or other services necessary to make determinations of disability. * * *

Subpart N--[Amended]

    40. The authority citation for subpart N of part 416 continues to 
read as follows:

    Authority: Secs. 702(a)(5), 1631, and 1633 of the Social 
Security Act (42 U.S.C. 902(a)(5), 1383, and 1383b).

    41. Amend Sec.  416.1403 by removing ``and'' from the end of 
paragraph (a)(19), removing the ``.'' at the end of paragraph (a)(20) 
and replacing it with ``;'' and by adding paragraphs (a)(21) and (22) 
to read as follows:


Sec.  416.1403  Administrative actions that are not initial 
determinations.

    (a) * * *
    (21) Determining whether to select your claim for the quick 
disability determination process under Sec.  405.101 of this chapter; 
and
    (22) The removal of your claim from the quick disability 
determination process under Sec.  405.101 of this chapter.
* * * * *

PART 422--ORGANIZATION AND PROCEDURES

Subpart B--[Amended]

    42. The authority citation for subpart B of part 422 continues to 
read as follows:

    Authority: Secs. 205, 232, 702(a)(5), 1131, and 1143 of the 
Social Security Act (42 U.S.C. 405, 432, 902(a)(5), 1320b-1, and 
1320b-13).

    43. Amend Sec.  422.130 by revising the first sentence of paragraph 
(b) and the first and second sentences of paragraph (c) to read as 
follows:


Sec.  422.130  Claim procedure.

* * * * *
    (b) * * * An individual who files an application for monthly 
benefits, the establishment of a period of disability, a lump-sum death 
payment, or entitlement to hospital insurance benefits or supplementary 
medical insurance benefits, either on his own behalf or on behalf of 
another, must establish by satisfactory evidence the material 
allegations in his application, except as to earnings shown in the 
Social Security Administration's records

[[Page 43624]]

(see subpart H of part 404 of this chapter for evidence requirements in 
nondisability cases and subpart P of part 404 of this chapter and part 
405 of this chapter for evidence requirements in disability cases). * * 
*
    (c) * * * In the case of an application for benefits, the 
establishment of a period of disability, a lump-sum death payment, a 
recomputation of a primary insurance amount, or entitlement to hospital 
insurance benefits or supplementary medical insurance benefits, the 
Social Security Administration, after obtaining the necessary evidence, 
will make a determination as to the entitlement of the individual 
claiming or for whom is claimed such benefits, and will notify the 
applicant of the determination and of his right to appeal. Section 
404.1520 and subpart I of part 405 of this chapter has a discussion of 
the respective roles of State agencies and the Administration in the 
making of disability determinations and Sec.  404.1521 and subparts B 
and I of part 405 of this chapter has information regarding initial 
determinations as to entitlement or termination of entitlement in 
disability cases. * * *
* * * * *
    44. Revise Sec.  422.140 to read as follows:


Sec.  422.140  Reconsideration or review of initial determination.

    Subject to the provisions of subpart C of part 405 of this chapter, 
if you are dissatisfied with an initial determination with respect to 
entitlement to monthly benefits, a lump-sum death payment, a period of 
disability, a revision of an earnings record, with respect to any other 
right under title II of the Social Security Act, or with respect to 
entitlement to hospital insurance benefits or supplementary medical 
insurance benefits, you may request that we reconsider the initial 
determination. In claims adjudicated under the procedures in part 405 
of this chapter, if you are dissatisfied with an initial determination, 
you may request review by a reviewing official. The information in 
Sec.  404.1503 and part 405 of this chapter as to the respective roles 
of State agencies and the Social Security Administration in making 
disability determinations is also generally applicable to the 
reconsideration (or review by reviewing officials) of initial 
determinations involving disability. However, in cases in which a 
disability hearing as described in Sec. Sec.  404.914 through 404.918 
and 416.1414 through 416.1418 of this chapter is available, the 
reconsidered determination may be issued by a disability hearing 
officer or the Associate Commissioner for Disability Programs or his or 
her delegate. After the initial determination has been reconsidered (or 
reviewed by a reviewing official in claims adjudicated under the 
procedures in part 405 of this chapter), we will mail you written 
notice and inform you of your right to a hearing before an 
administrative law judge (see Sec.  422.201 and subpart D of part 405, 
and 42 CFR 405.904(a)).

Subpart C--[Amended]

    45. The authority citation for subpart C of part 422 continues to 
read as follows:

    Authority: Secs. 205, 221, and 702(a)(5) of the Social Security 
Act (42 U.S.C. 405, 421, and 902(a)(5)); 30 U.S.C. 923(b).

    46. Amend Sec.  422.201 by revising the first and second sentences 
in the introductory text and by adding a new third sentence to read as 
follows:


Sec.  422.201  Material included in this subpart.

    This subpart describes in general the procedures relating to 
hearings before an administrative law judge of the Office of Hearings 
and Appeals, review by the Appeals Council of the hearing decision or 
dismissal, and court review in cases decided under the procedures in 
parts 404, 408, 410 and 416 of this chapter. It also describes the 
procedures for requesting such hearing or Appeals Council review, and 
for instituting a civil action for court review for cases decided under 
these parts. Procedures related to hearings before an administrative 
law judge, review by the Decision Review Board or court review in 
claims adjudicated under the procedures in part 405 of this chapter are 
explained in subparts D, E, and F of part 405 of this chapter. * * *
* * * * *
[FR Doc. 05-14845 Filed 7-26-05; 8:45 am]
BILLING CODE 4191-02-P