1 2 3 4 5 6 7 8 UNITED STATES DISTRICT COURT 9 SOUTHERN DISTRICT OF CALIFORNIA 10 11 ALICE M., Case No.: 24-cv-00225-KSC

12 Plaintiff,

ORDER REVERSING DENIAL OF

13 v. BENEFITS AND REMANDING

CASE FOR FURTHER

14 LELAND DUDEK, Acting Commissioner

ADMINISTRATIVE PROCEEDINGS

of Social Security, 15 Defendant. 16

17 18 I. INTRODUCTION 19 Plaintiff Alice M. seeks review of the Commissioner of Social Security’s denial of 20 disability benefits. Doc. No. 1. The parties have filed briefs for review of the decision. Doc. 21 Nos. 18, 22, 23. For the reasons set forth herein, the Court reverses the denial of benefits 22 and remands the case for further proceedings. 23 II. PROCEDURAL BACKGROUND 24 On November 30, 2018, plaintiff applied for disability insurance benefits claiming 25 disability beginning August 30, 2018. AR 457-59.1 The Social Security Administration 26 27 1 “AR” refers to the Administrative Record lodged on April 2, 2024. Doc. No. 15. The 28 1 denied plaintiff’s claim and denied reconsideration. AR 236–40, 242–46. Plaintiff 2 requested a hearing, which an Administrative Law Judge (“ALJ”) held in three parts, on 3 April 20 and August 26, 2021, and October 25, 2022. AR 81–111, 112–63, 164–73. On 4 February 7, 2023, the ALJ issued a decision finding plaintiff not disabled. AR 21–51. On 5 December 13, 2023, the Appeals Counsel denied plaintiff’s request for review. AR 8–13. 6 Plaintiff then filed this case. Doc. No. 1. 7 III. SUMMARY OF ALJ’S DECISION 8 The ALJ followed the five-step sequential evaluation process. See 20 C.F.R. 9 § 404.1520. At step one, the ALJ found plaintiff had “not engaged in substantial gainful 10 activity since August 30, 2018.” AR 28. 11 At step two, the ALJ found the following severe medically determinable 12 impairments: seronegative osteoarthritis; degenerative disc disease with stenosis, 13 principally affecting the cervical spine; degenerative joint disease of the shoulders; and 14 asthma. Id. The ALJ also found plaintiff’s anxiety disorder was not severe. AR 30. 15 At step three, the ALJ found plaintiff did not have an impairment or combination of 16 impairments that met or medically equaled those in the Commissioner’s Listing of 17 Impairments. AR 32. 18 Before proceeding to step four, the ALJ determined plaintiff had the residual 19 functional capacity (“RFC”) to perform light work “as the claimant could lift and/or carry 20 20 pounds occasionally and 10 pounds frequently, stand and/or walk for 6 hours in an 8 21 hour day, and sit for 6 hours in an 8 hour day,” subject to these non-exertional limitations: 22 she could frequently balance, stop, kneel, crouch or crawl; occasionally climb ramps or stairs; never climb ladders, ropes or 23 scaffolding; frequently reach, handle, finger, and feel bilaterally 24 except bilateral overhead reaching only is limited to occasionally; occasionally push and pull with the lower 25

26 27 the page numbers designated by the Court’s case management/electronic case filing system (“CM/ECF”). For all other documents, the Court’s citations are to the page numbers affixed 28 1 extremities; must avoid work at unprotected heights or around dangerous moving machinery; and must avoid concentrated 2 exposure to dust, odors, fumes, other pulmonary irritants, 3 vibration, or extreme cold.

4 AR 33. 5 At step four, the ALJ found plaintiff could perform her past relevant work, which 6 the ALJ classified as a medical records technician (DOT Code 079.362-014, SVP-6, 7 skilled, light exertion). AR 40. The ALJ then made an alternative finding at step five that 8 plaintiff could work as a medical records clerk (DOT Code 245.362-010, SVP-4, 9 semiskilled, light exertion, based on transferable skills acquired as a medical records 10 technician). AR 41-42. 11 IV. STANDARD OF REVIEW 12 The Court reviews the ALJ’s decision to determine whether the ALJ applied the 13 proper legal standards and whether the decision is supported by substantial evidence. 14 42 U.S.C. § 405(g); Bayliss v. Barnhart, 427 F.3d 1211, 1214 n.1 (9th Cir. 2005). 15 Substantial evidence is “such relevant evidence as a reasonable mind might accept as 16 adequate to support a conclusion. Molina v. Astrue, 674 F.3d 1104, 1121 (9th Cir. 2012) 17 (quotation omitted). It is “more than a mere scintilla but, less than a preponderance . . . .” 18 Garrison v. Colvin, 759 F.3d 995, 1009 (9th Cir. 2014) (quoting Lingenfelter v. Astrue, 19 504 F.3d 1028, 1035 (9th Cir. 2007)). 20 The Court “must consider the entire record as a whole and may not affirm simply by 21 isolating a specific quantum of supporting evidence.” Ghanim v. Colvin, 763 F.3d 1154, 22 1160 (9th Cir. 2014) (internal quotation omitted). “[I]f evidence exists to support more than 23 one rational interpretation, [the Court] must defer to the Commissioner’s decision.” Batson 24 v. Comm’r of Soc. Sec. Admin., 359 F.3d 1190, 1193 (9th Cir. 2004). 25 V. DISCUSSION 26 Plaintiff contends the ALJ committed two errors: (1) “failing to account for any 27 mental limitations in the RFC . . . [or] explain why such limitations were not included” and 28 1 (2) “improperly finding . . . plaintiff could perform her past relevant work.” Doc. No. 18 at 2 7, 17. The Court addresses each of these claimed errors in turn. 3 A. Mental Impairment Finding 4 The ALJ found plaintiff’s “medically determinable mental impairment of anxiety 5 does not cause more than minimal limitation in the claimant’s ability to perform basic 6 mental work activities and is, therefore, nonsevere.” AR 30. In reaching this conclusion, 7 the ALJ considered the four broad functional areas set out in 20 CFR, Part 404, Subpart P. 8 Appendix 1, known as the “paragraph B” criteria. Id. at 30-31. The ALJ then concluded 9 plaintiff had mild limitations in the functional areas: (1) understanding, remembering, or 10 applying information; (2) interacting with others; (3) concentrating, persisting, or 11 maintaining pace; and (4) adapting or managing herself. Id. The ALJ did not discuss 12 plaintiff’s mental limitations in plaintiff’s RFC. AR 33-40. 13 Plaintiff contends “the ALJ erred by not including mental limitations in the RFC and 14 by not explaining why plaintiff’s mental limitations were not limiting enough to include 15 appropriate limitations in the RFC.” Doc. No. 18 at 12, citing Hutton v. Astrue, 491 16 F.App’x. 850 (9th Cir. 2012). Plaintiff further argues “the ALJ’s error is not harmless given 17 the fact the ALJ determined plaintiff could perform her [past relevant work] and has 18 transferrable skills to perform as a medical records clerk,” which is a semi-skilled position. 19 Id. at 15. Defendant does not address Hutton and instead posits “it was reasonable that the 20 ALJ did not include any [mental limitations] in the [RFC].” Doc. No. 22 at 5. 21 An ALJ must consider the limiting effect of all impairments, including non-severe 22 ones, in assessing a claimant’s RFC. 20 C.F.R. § 404.1545(a)(2) (“[The SSA] will consider 23 all of [a claimant’s] medically determinable impairments of which [the SSA] [is] aware, 24 including [a claimant’s] medically determinable impairments that are not ‘severe’ . . . when 25 [the SSA] assess[es] [a claimant’s] residual functional capacity.”); see also Hutton, 491 26 F.App’x 850 (“Regardless of [a mental limitation’s] severity . . . the ALJ was still required 27 to consider [the plaintiff’s mental limitation] when he determined [the plaintiff’s] RFC.”) 28 1 The record indicates plaintiff “feels completely incapable of performing even very 2 simple or basic work.” AR 818. “Constant pain stresses [her] out and causes anxiety. AR 3 582. She is “forgetful a lot of times,” has difficulty paying attention, reading and following 4 instructions, and completing tasks. AR 580. She also “‘get[s] extremely depressed because 5 of the pain,’ decreased physical functioning, and loss of income.” AR 818. 6 Here, however, the ALJ does not appear to have considered plaintiff’s anxiety when 7 formulating the RFC. The ALJ does not attribute any limiting effects to her anxiety or 8 explain why, after finding plaintiff had mild mental limitations in each functional area, he 9 did not include any restrictions related to these limitations in the RFC. While defendant 10 urges the Court to find the ALJ’s failure to discuss any limiting effects caused by plaintiff’s 11 anxiety was reasonable, “[t]he Court will not infer in a vacuum that the ALJ considered 12 plaintiff’s mild mental limitations but then validly concluded . . . they did not cause any 13 significant limitation necessitating inclusion in the RFC.” Patricia C. v. Saul, No. 19-cv- 14 0636-JM-JLB, 2020 WL 4596757, at *13 (S.D. Cal. Aug. 11, 2020); see also Gates v. 15 Berryhill, No. 16-cv-0049-AFM, 2017 WL 2174401, at *3 (C.D. Cal. May 16, 2017) 16 (following Hutton and rejecting Commissioner’s argument the court can infer the ALJ 17 considered plaintiff’s mild mental limitations). 18 The ALJ erred when he did not address whether plaintiff’s anxiety limited her ability 19 to work when assessing her RFC. See Hutton, 491 F.App’x 850. This error was not 20 “inconsequential to the ultimate nondisability determination” because “[t]he Court cannot 21 determine what the result would have been if the ALJ had considered plaintiff’s mild 22 mental limitations when assessing her RFC.” Patricia C., 2020 WL 4596757, at *13. 23 B. Past Relevant Work Finding 24 At step four the ALJ found plaintiff could perform her past relevant work, which the 25 vocational expert (“VE”) classified as a medical records technician (DOT Code 079.362- 26 014, SVP-6), a skilled position requiring light exertion as a medical records technician at 27 step four. AR 40. The ALJ then made an alternative finding at step five that plaintiff could 28 work as a medical records clerk (DOT Code 245.362-010, SVP-4), a semi-skilled position 1 requiring light exertion, based on transferable skills she acquired as a medical records 2 technician. AR 41-42. 3 Plaintiff argues these findings are not supported by substantial evidence because the 4 VE testified “plaintiff’s past relevant work as a medical records technician has evolved 5 over the last [five] to eight years into a sedentary position [due to] computerization,” 6 whereas plaintiff has not performed the job since 2016 and the record lacks evidence 7 showing she has the computer skills necessary to perform the job today. Doc. No. 18 at 18- 8 19. 9 Defendant offers alternate counterpoints. First, defendant responds “this is 10 essentially a restatement of plaintiff’s first argument about the [RFC] finding.” Doc. No. 11 22 at 6. It is not – the issue is whether the record supports the ALJ’s steps 4 and 5 findings. 12 Defendant further argues “[t]he ALJ was within reason to rely on the [VE’s] 13 testimony” and “the ALJ made . . . findings” on transferable skills. Id. at 7. Defendant does 14 not identify where these purported transferable skills findings appear in the ALJ’s decision. 15 1. Step 4 16 At step four, an ALJ may deny benefits if a claimant can still perform (1) a specific 17 prior job as “actually performed;” or (2) the same kind of work as it's “generally 18 performed” in the national economy. Pinto v. Massanari, 249 F.3d 840, 845 (9th Cir. 2001) 19 (citing Social Security Ruling (SSR) 82–61); SSR 82–62 at *3. 20 Here, the ALJ's step four conclusion that plaintiff can perform a medical records 21 technician job, which the VE classified her past relevant work as, rests solely on the VE’s 22 testimony. AR at 40-42. The VE testified she would categorize plaintiff’s “past work . . . 23 with the medical records” as a medical records technician. AR 155. She then elaborated 24 “per the DOT, that job is characterized as light, [but] I know over the past say five to eight 25 years that job has become more of a sedentary job because patient records have become 26 more computerized.” AR 156. 27 At step four the ALJ did not consider the VE’s testimony that the medical records 28 technician job as it is currently typically performed is different than when plaintiff last 1 worked. The ALJ also did not consider what computer skills are now required of a medical 2 records technician, or whether plaintiff possesses those skills. Thus, in light of the 3 inconsistency between the VE testimony regarding the requirements of a medical records 4 technician and the lack of evidence that plaintiff has the necessary computer skills to 5 perform the job, the VE testimony does not provide substantial evidence supporting the 6 ALJ's finding that plaintiff can perform her past relevant work. 7 2. Step 5 8 At step five, the ALJ has the burden of establishing, through the testimony of a 9 vocational expert or by reference to the Medical–Vocational Guidelines, that plaintiff can 10 perform alternative jobs that exist in substantial numbers in the national economy. Bruton 11 v. Massanari, 268 F.3d 824, 827 n. 1 (9th Cir. 2001). When a vocational expert's testimony 12 is used at step five, the expert “must identify a specific job or jobs in the national economy 13 having requirements that the claimant's physical and mental abilities and vocational 14 qualifications would satisfy.” Osenbrock v. Apfel, 240 F.3d 1157, 1162–1163 (9th Cir. 15 2001). 16 Acquired skills are transferable to other jobs “when the skilled or semi-skilled work 17 activities [the claimant] did in past work can be used to meet the requirements of skilled or 18 semi-skilled work activities of other jobs or kinds of work.” 20 C.F.R. §§ 404.1568(d)(1), 19 416.968(d)(1); see also SSR 82–41, 1982 WL 31389, at *2 (“Transferability means 20 applying work skills which a person has demonstrated in vocationally relevant past jobs to 21 meet the requirements of other skilled or semiskilled jobs.) “Transferability is most 22 probable and meaningful among jobs in which (1) the same or lesser degree of skill is 23 required, (2) the same or similar tools and machines are used, and (3) the same or similar 24 raw materials, products, processes, or services are involved.” 20 C.F.R. § 404.1568(d). 25 Plaintiff was born March 8, 1965, and had reached “advanced age,” pursuant to 20 26 C.F.R. § 404.1563, at the time of the hearing. AR 41. Because age is an adverse vocational 27 factor, the DOT classification of plaintiff's past relevant work is material to the ALJ's step 28 five finding. A person who is of “advanced age” or “closely approaching retirement age” 1 who is limited to light work or less, but cannot perform past relevant work, ordinarily must 2 have skills that are transferable to alternative skilled or semi-skilled work to be found not 3 disabled. 20 C.F.R. § 404.1568; see also Terry v. Sullivan, 903 F.2d 1273, 1275–1276 (9th 4 Cir. 1990) (“[I]t is not enough that persons of advanced age are capable of doing unskilled 5 work; to be not disabled, they must have acquired skills from their past work that are 6 transferable to skilled or semiskilled work.”). 7 The ALJ’s alternative finding at step five that plaintiff could work as a medical 8 records clerk is based on the VE’s testimony that “an individual with the same age, 9 education, past relevant work experience, and [RFC] as [plaintiff], and [with] . . . skills 10 acquired in [plaintiff’s] past relevant work but no additional skills” would “require no 11 significant vocational adjustment” to be employed as a medical records clerk position. AR 12 41-42. 13 Here, the ALJ’s finding that plaintiff has transferable skills to be employed as a 14 medical records clerk is based on the VE’s testimony “the skills that a person would gain 15 from working many years as a medical record technician . . . would transfer to a medical 16 record clerk position.” AR 156. As discussed, supra, the record does not support the ALJ’s 17 finding plaintiff could be currently employed as a medical record technician given the 18 computer skills requirement that has evolved since plaintiff last performed the job, and the 19 lack of evidence that she has the necessary computer skills. Ergo, the ALJ’s subsequent 20 conclusion that plaintiff has transferable skills to another job based on her ability to 21 perform the medical record technician job is also unsupported. 22 For the foregoing reasons, the VE’s testimony does not amount to substantial 23 evidence supporting the ALJ's finding that plaintiff has skills that are transferable with little 24 vocational adjustment to the alternative DOT job medical records clerk. 25 V. REMEDY 26 Here remand is required, at a minimum, in order for the ALJ to reevaluate the RFC 27 as well as steps four and five. See Bunnell v. Barnhart, 336 F.3d 1112, 1116 (9th Cir. 2003) 28 (remanding for further administrative proceedings where “outstanding issues” remained to 1 || be resolved and it was “not clear from the record that an [ALJ] would be required to find 2 claimant disabled and award disability benefits”); Trevizo v. Berryhill, 871 F.3d 664, 3 (9th Cir. 2017) (‘The decision whether to remand a case for additional evidence, or 4 ||simply to award benefits is within the discretion of the court.”) 5 VI. CONCLUSION 6 Based on the foregoing, the Commissioner’s decision is REVERSED and the case 7 ||is REMANDED for further proceedings consistent with this Order. 8 IT IS SO ORDERED. 9 || Dated: March 24, 2025 A iy i; ) 10 WU LA 1 Hori. Karen S. Crawford United States Magistrate Judge 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 28