"there is no evidence" that the change in step two denial rates was attributable to "a total change in the nature of the claimant population" that might account for the change in denial rates. Exh. 48 at 11.
Lastly, it must be noted that the Wilson court placed great weight on the hypothesis that the rise in step two denial rates may have been due to the Secretary's refusal to consider the combined effects of impairments, rather than to application of a heightened severity standard. See 734 F. Supp. at 167 & n.7, 169. This theory is questionable for at least two reasons. First, the Wilson court apparently did not have access to SSA's 800-case study that is in the record before this Court. One report on the study specifically indicates that the errors committed by the states in misapplying step two were "not due to the complexity of the presence of multiple impairments." Exh. 49 at 5. The report further states that "new regulations concerning multiple not severe impairments will not obviate the differences between central office and field ratings," id. at 6, and a different report on the same data even went to so far as to note that "there were no cases with multiple impairments identified as not severe where the combined effect was determined to be severe by the OD physicians." Exh. 24 at 12. While the precise import of these statements is by no means clear, they do appear, at the very least, to offer some evidence that the effect of combined impairments on the rise in step two denial rates was more modest than the Wilson court supposed.
Second, the Wilson court's theory that the rise in step two denial rates may have been due to the Secretary's refusal to consider the combined effects of impairments cannot account for the fact that denial rates had risen dramatically well before the noncombination policy was initiated in December of 1978.
In sum, the evidence in the record is sufficient to support a finding of misapplication even before issuance of the POMS and SSR. In addition to the Lachman affidavit, which is corroborated by the Houben and Kelly letters, the Court finds the statistical evidence on social security denials to be highly probative of the Secretary's misapplication. The Court cannot accept the Secretary's contention that the sharp increase in denials reflected nothing more than occasional mistakes of a few adjudicators who misunderstood instructions.
G. Use of the Secretary's Noncombination Policy
Between December, 1978, and December 1, 1984, the Secretary prohibited adjudicators from considering the combined impact of non-severe impairments on a claimant's ability to perform work-related functions. This policy was first incorporated in the DISM and was included in the SSR. Plaintiffs argue that this "noncombination" policy violated the Social Security Act and resulted in the denial of potentially meritorious claims.
The Second Circuit has long required that the combined effect of all of a claimant's impairments must be considered in determining disability and has repeatedly ruled that the Act requires SSA to evaluate the combined impact on a claimant's ability to work of every impairment, regardless of whether each is considered severe. See, e.g., De Leon v. Secretary, 734 F.2d 930 (2d Cir. 1984) (Secretary's decision terminating claimant's SSI benefits reversed in part for failure to consider the combined effect of his four impairments); Cutler v. Weinberger, 516 F.2d 1282, 1285 (2d Cir. 1975) (claimant's case remanded for new SSA review of the combined effect of impairments on ability to work).
Every Circuit Court that has considered the issue has likewise held that SSA must consider the combined effect of all of a claimant's impairments in determining disability. See, e.g., Bowen v. Heckler, 748 F.2d 629 (11th Cir. 1984); Dellolio v. Heckler, 705 F.2d 123, 128 (5th Cir. 1983). This includes every federal appellate court reviewing the issue in the context of a class action. Johnson v. Sullivan, 922 F.2d 346, 350 (7th Cir. 1990) (en banc); Bailey v. Sullivan, 885 F.2d 52, 59-61 (3d Cir. 1989); McDonald v. Secretary of Health and Human Services, 795 F.2d 1118, 1126 (1st Cir. 1986).
Without citing a single one of the relevant Circuit Court opinions listed above, the Secretary attempts to argue that his noncombination policy was consistent with the Act. Specifically, the Secretary argues that the fact that the Social Security Act defines "disability" as the "inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months," 42 U.S.C. § 423(d)(1)(A), requires the presence of at least one impairment which by itself could render the claimant disabled. The Secretary further contends that Yuckert held that Section 423(d)(1)(A) is the controlling provision of the Act with respect to defining disability.
Plaintiffs point to a different section of the Act, 423(d)(2)(A), which mandates that a claimant be found disabled, "if his physical or mental impairment or impairments are of such severity that he is not only unable to do his previous work, but cannot . . . engage in any other kind of substantial work." (emphasis added). Plaintiffs note that this requirement was reiterated by a 1984 amendment to the Act which specifically requires:
[The] Secretary shall consider the combined effect of all of the individual's impairments without regard to whether any such impairment, if considered separately, would be of such severity.