A.M. v. O'Malley

Background

A.M. applied for Title XVI disability benefits for the period beginning May 1, 2016. After the Social Security Administration denied the application initially and on reconsideration, an Administrative Law Judge held a hearing and issued an unfavorable decision. The Appeals Council denied review, and A.M. sought judicial review under 42 U.S.C. § 405(g).

The Administrative Law Judge found that A.M. had not engaged in substantial gainful activity and had severe impairments including generalized anxiety disorder, major depressive disorder, post-traumatic stress disorder, opioid use disorder, alcoholism, and a right-sided inguinal hernia. At the first five-step evaluation, the Administrative Law Judge found that A.M.’s impairments, including substance use, met the requirements of listing 12.15 for trauma- and stressor-related disorders.

Because the impairments included alcohol and opioid abuse, the Administrative Law Judge conducted a second evaluation under Social Security Ruling 13-2p. That analysis asks whether drug or alcohol use is a contributing factor material to disability—in other words, whether the person would no longer be disabled if the substance use stopped. The Administrative Law Judge found that A.M. would not meet listing 12.15 without substance use and therefore decided that substance use was material.

Court’s Analysis

The court held that the Administrative Law Judge committed reversible legal error at step three of the substance-use materiality analysis. Although A.M. had the burden to prove disability, the court explained that A.M. did not need to provide separate evidence from a period of abstinence. Under Social Security Ruling 13-2p, substance use is material only when the record contains evidence showing that the co-occurring mental disorder would improve to the point of nondisability without substance use.

The court concluded that the record did not contain substantial evidence—evidence that a reasonable person would accept as adequate—to support that finding. The jail records cited by the Administrative Law Judge were created when A.M. was actively using substances, was experiencing recent use or withdrawal, or had only recently arrived at jail. The court also found that many of the records focused on withdrawal monitoring rather than providing a comprehensive assessment of A.M.’s mental health without substance use.

The court found problems with the treatment of Dr. Catlin’s opinion as well. The Administrative Law Judge relied on the opinion in the materiality analysis while also finding it less persuasive because the objective evaluations did not support its conclusions. The court further noted that the record contradicted the assumption that A.M. had been sober from 2019 through the evaluation. The court also found that the Administrative Law Judge selectively cited Dr. Arnold’s treatment notes, omitting continuing symptoms and impairments, and thereby substituted his own judgment for the medical opinion.

Remedy and Disposition

The court considered whether to remand for more administrative proceedings or for an immediate award of benefits. It determined that the record was sufficiently developed, that the Administrative Law Judge’s legal error was established, and that the Administrative Law Judge had already found A.M. disabled when considering substance use. Because the materiality finding was erroneous and the record did not show that A.M.’s impairments would improve to the point of nondisability without substance use, the court concluded that an award of benefits was required.

Judge Nathanael M. Cousins therefore REVERSED the Administrative Law Judge’s decision and REMANDED the matter under sentence four of 42 U.S.C. § 405(g) for the immediate calculation and award of benefits.