Melissa Varga v. Carolyn Colvin , 794 F.3d 809 ( 2015 )

In the
United States Court of Appeals
For the Seventh Circuit
____________________
No. 14-2122
MELISSA L. VARGA,
Plaintiff-Appellant,
v.
CAROLYN W. COLVIN, Acting Commissioner of Social Securi-
ty,
Defendant-Appellee.
____________________
Appeal from the United States District Court for the
Eastern District of Wisconsin.
No. 1:12-cv-1102 — William C. Griesbach, Chief Judge.
____________________
ARGUED DECEMBER 12, 2014 — DECIDED JULY 24, 2015
____________________
Before ROVNER, WILLIAMS, and TINDER, Circuit Judges.
WILLIAMS, Circuit Judge. Melissa Varga suffers from a
combination of physical and mental impairments, including
post-traumatic stress disorder, endometriosis, major depres-
sion, irritable bowel syndrome, and fibromyalgia. As a re-
sult, she applied for disability insurance benefits, but an
Administrative Law Judge (“ALJ”) denied her application.
Varga sought review in the district court, which affirmed the
2 No. 14-2122
decision of the ALJ. Varga appeals, arguing the ALJ erred by
failing to include her mental limitations in the areas of con-
centration, persistence, and pace in the hypothetical question
that he posed to the vocational expert. She contends the
flawed hypothetical led the vocational expert and the ALJ to
erroneously conclude she was not disabled. We agree that
the hypothetical was fatally flawed. We therefore reverse the
judgment of the district court and remand to the agency for
further proceedings.
I. BACKGROUND
Melissa Varga, who is presently forty-two, applied for
disability insurance benefits in July 2006, alleging she had
been disabled since December 2005. Prior to this, Varga
served in the Army. She received a medical discharge from
the military in 1994 because of her severe endometriosis (a
condition which causes pelvic pain). She then worked as a
correctional officer, and later an office worker, at the Federal
Correctional Institute (FCI) in Oxford, Wisconsin. She left
the FCI in 2005 because of her continuing physical and men-
tal impairments. Varga has not worked since March 2006,
when her application for disability retirement under the
Federal Employees Retirement System was approved.
Between 2005 and 2011, Varga’s condition was assessed
by an array of medical professionals in connection with her
attempts to obtain disability benefits. She was diagnosed
with a combination of debilitating conditions, including
post-traumatic stress disorder, endometriosis, major depres-
sion, irritable bowel syndrome, and fibromyalgia (a chronic
muscle pain disorder). While Varga’s medical history is
lengthy, we limit our review here to the one medical assess-
ment relevant to her appeal.
No. 14-2122 3
In August 2006, Dr. Roger Rattan, a state agency psycho-
logical consultant, reviewed Varga’s medical records and
completed two forms regarding her condition: the Psychiat-
ric Review Technique (PRT) form and the Mental Residual
Functional Capacity Assessment (MRFCA) form. On the PRT
form, Dr. Rattan noted that Varga had a moderate restriction
in activities of daily living, mild difficulties in maintaining
social functioning, and—of particular relevance to this ap-
peal—moderate difficulties in maintaining “concentration,
persistence, or pace.”
On the MRFCA form, Dr. Rattan attributed similar diffi-
culties to Varga. In Section I of the form, 1 Dr. Rattan checked
boxes indicating that Varga was moderately limited in (1)
understanding and remembering detailed instructions; (2)
carrying out detailed instruction; (3) maintaining attention
and concentration for extended periods; (4) completing a
normal workweek without interruption from psychological-
ly based symptoms and performing at a consistent pace
without an unreasonable number and length of rest periods;
(5) accepting instructions and responding appropriately to
criticism from supervisors; (6) getting along with coworkers
without distracting them or exhibiting behavioral extremes;
and (7) responding appropriately to changes in the work set-
ting.
1 Section I is a “worksheet to aid in deciding the presence and degree
of functional limitations and the adequacy of documentation.” It con-
tains twenty mental functions grouped under four main categories: (1)
understanding and memory, (2) sustained concentration and persistence,
(3) social interaction, and (4) adaptation. To the right of each of the items
is a series of decision check blocks under the headings “not significantly
limited,” “moderately limited,” “markedly limited,” “no evidence of lim-
itation,” and “not ratable on available evidence.”
4 No. 14-2122
Section III of this MRFCA form (the “Functional Capacity
Assessment” section) instructed Dr. Rattan to “Explain your
summary conclusions in a narrative form.” Dr. Rattan, how-
ever, instead wrote “See EWS” in the space provided. This
notation referred to an electronic worksheet, which was lost
by the agency. As a result, Dr. Rattan’s narrative summary
of Varga’s mental residual functional capacity, if it ever ex-
isted, was not part of the record before the district or this
court.
The Social Security Administration (“SSA”) denied both
Varga’s claim for benefits and her request for reconsidera-
tion, so she requested an administrative hearing. In April
2009, Varga appeared for a video hearing before an ALJ,
who found Varga not disabled. After the Appeals Council
denied Varga’s request for review, she filed suit in federal
court. In February 2011, the district court reversed and re-
manded the case to the agency for further proceedings be-
cause the ALJ did not analyze opinions from Varga’s treat-
ing physician and psychologist, and gave inadequate con-
sideration to the disability determination made by the Veter-
ans Administration. The following month, the Appeals
Council remanded the case to a new ALJ for further pro-
ceedings consistent with the district court’s order.
On June 12, 2012, Varga had her second hearing. As part
of the hearing, the ALJ formulated a hypothetical question to
a vocational expert (“VE”) to assess what jobs Varga could
perform. See 20 C.F.R. § 416.960(b)(2) (an ALJ may enlist a
VE to “offer expert opinion testimony in response to a hypo-
thetical question” about whether “physical and mental limi-
tations imposed by the claimant’s medical impairment(s) can
meet the demands of the claimant’s previous work”). The
No. 14-2122 5
ALJ directed the VE to assume an individual with Varga’s
vocational profile (age, education, and work experience)
who was able to perform
simple, routine, or repetitive tasks in a work
environment … free of fast paced production
requirements, involving only simple work re-
lated decisions with few if any work place [sic]
changes and no more than occasional interac-
tion with coworkers or supervisors.
The VE testified that such a person could perform Varga’s
past work (as an office helper) as she actually performed the
job, as well as the jobs of inspector, laundry worker, hand
packager, and cashier.
After considering this and other evidence, the ALJ ap-
plied the SSA’s five-step disability evaluation. See 20 C.F.R.
§§ 404.1520, 416.920. 2 At step one, the ALJ determined that
Varga had not engaged in substantial gainful activity since
December 2005. At steps two and three, the ALJ found Varga
had “moderate difficulties” with “concentration, persistence,
or pace.” However, at step three, he concluded that Varga
did not have an impairment or combination of impairments
that met or medically equaled the criteria of Listing 12.03,
2 The regulations require the ALJ to review (1) the claimant’s current
work activity; (2) the medical severity and duration of the claimant’s im-
pairments; (3) whether the claimant’s impairments meet or medically
equal the requirements of an impairment listed in the regulations; (4)
whether the claimant has the residual functional capacity to return to
past relevant work; and (5) if the claimant cannot return to past relevant
work, whether he or she can “make an adjustment to other work” in the
national economy. 20 C.F.R. § 404.1520(a)(4)(i)-(v).
6 No. 14-2122
which pertains to schizophrenic, paranoid and other severe
psychotic disorders.
Prior to undertaking the fourth and fifth steps, the ALJ
was required to make an assessment of Varga’s residual
functional capacity (“RFC”). 20 C.F.R. § 404.1545(a)(1). This
is an assessment of what work-related activities the claimant
can perform despite her limitations, which must be assessed
based on all the relevant evidence in the record. Id. In the
ALJ’s RFC assessment, he determined Varga could perform
light work as defined in 20 CFR 404.1567(b) ex-
cept that the claimant can climb ladders, ropes
and scaffolds occasionally. The claimant must
avoid all exposure to noise and even moderate
exposure to unprotected heights, hazards and
the use of moving machinery. The claimant is
limited to simple, routine, and repetitive tasks
in a work environment free of fast paced pro-
duction requirements, involving only simple,
work-related decisions with few if any work
place [sic] changes.
At step four, the ALJ relied on the testimony of the voca-
tional expert that a person with Varga’s age, experience, ed-
ucation, and residual functional capacity could perform her
past work as an office helper as she actually performed the
job. At step five, the ALJ made an alternative finding that a
person with Varga’s age, experience, education, and residual
functional capacity could perform other jobs such as an in-
spector, laundry worker, or cashier. In light of these find-
ings, the ALJ concluded that Varga had not been disabled
between December 2, 2005 and December 31, 2010.
No. 14-2122 7
The ALJ’s decision became the final decision of the
Commissioner when the Appeals Council denied Varga’s
request for review. See 20 C.F.R. §§ 404.955, 404.981. In Octo-
ber 2012, Varga filed a civil action for judicial review of the
Commissioner’s final decision. The district court affirmed
the Commissioner’s decision and this appeal followed.
II. ANALYSIS
We review the district court’s affirmance de novo and re-
view directly the ALJ’s decision. Yurt v. Colvin, 758 F.3d 850,
856 (7th Cir. 2014). Specifically, we need to determine if the
ALJ’s decision was supported by “substantial evidence,”
which we have described as “such relevant evidence as a
reasonable mind might accept as adequate to support a con-
clusion.” Id. An ALJ need not specifically address every
piece of evidence, but must provide a “logical bridge” be-
tween the evidence and his conclusions. O'Connor-Spinner v.
Astrue, 627 F.3d 614, 618 (7th Cir. 2010).
Varga presents only one challenge on appeal—that the
ALJ’s hypothetical question to the vocational expert was
flawed because it failed to account for all of her mental limi-
tations—namely, the “moderate difficulties” in the areas of
concentration, persistence, and pace that Dr. Rattan (the
state agency’s psychological consultant) noted in his assess-
ments and which the ALJ attributed to Varga at steps two
and three of its sequential analysis.
In this circuit, “both the hypothetical posed to the VE and
the ALJ’s RFC assessment must incorporate all of the claim-
ant’s limitations supported by the medical record.” Yurt, 758
F.3d at 857; O'Connor–Spinner, 627 F.3d at 619 (“Our cases,
taken together, suggest that the most effective way to ensure
that the VE is apprised fully of the claimant’s limitations is
8 No. 14-2122
to include all of them directly in the hypothetical.”); Indoran-
to v. Barnhart, 374 F.3d 470, 473–74 (7th Cir. 2004) (“If the ALJ
relies on testimony from a vocational expert, the hypothet-
ical question he poses to the VE must incorporate all of the
claimant’s limitations supported by medical evidence in the
record.”); see also SSR 96–5p, 1996 WL 374183, at *5 (RFC as-
sessment “is based upon consideration of all relevant evi-
dence in the case record, including medical evidence and
relevant nonmedical evidence”); 20 C.F.R. § 404.1545.
Among the mental limitations that the VE must consider
are deficiencies of concentration, persistence, or pace. Yurt,
758 F.3d at 857; Stewart v. Astrue, 561 F.3d 679, 684 (7th Cir.
2009) (hypothetical question “must account for documented
limitations of ‘concentration, persistence, or pace’”) (collect-
ing cases). Although it is not necessary that the ALJ use the
precise terminology of “concentration,” “persistence,” or
“pace,” we will not assume that a VE is apprised of such lim-
itations unless he or she has independently reviewed the
medical record. Yurt, 758 F.3d at 857. There is no evidence
that the VE in this case reviewed Varga’s medical history or
heard testimony about the various medical limitations that
Varga argues were omitted from the ALJ's hypothetical.
Thus, we would expect an adequate hypothetical to include
the limitations identified by Dr. Rattan. See id. (noting hypo-
thetical question to VE should include findings made by
state agency psychological consultant of “moderate difficul-
ties” on MRFCA form).
Here, there is medical evidence in the record that Varga
has moderate difficulties maintaining concentration, persis-
tence, and pace. Most notably, Dr. Rattan’s assessment of
Varga’s mental RFC for the state agency noted moderate dif-
No. 14-2122 9
ficulties in seven areas related to concentration, persistence,
and pace: (1) understanding and remembering detailed in-
structions; (2) carrying out detailed instruction; (3) maintain-
ing attention and concentration for extended periods; (4)
completing a normal workweek without interruption from
psychologically based symptoms and performing at a con-
sistent pace without an unreasonable number and length of
rest periods; (5) accepting instructions and responding ap-
propriately to criticism from supervisors; (6) getting along
with coworkers without distracting them or exhibiting be-
havioral extremes; and (7) responding appropriately to
changes in the work setting. In his decision, the ALJ “con-
cur[red]” with the assessment of Varga’s mental state made
by the state agency, and this assessment is presumably what
led the ALJ to find that Varga had moderate difficulties with
regard to “concentration, persistence, or pace” at steps two
and three of his sequential analysis. However, the ALJ did
not address all of these difficulties in his hypothetical ques-
tion to the vocational expert. Because a hypothetical posed to
a VE must incorporate all of the claimant’s limitations sup-
ported by the medical record—including moderate limita-
tion in concentration, persistence, and pace—we find that
the ALJ committed reversible error. See Yurt, 758 F.3d at 857
(failure of ALJ to include in hypothetical moderate difficul-
ties in concentration, persistence, and pace attributed to ap-
plicant in Section I the MRFCA form was reversible error).
The Commissioner makes several arguments in defense
of the hypothetical posed by the ALJ, but none are persua-
sive. First, she argues that the hypothetical and the RFC did
in fact account for all of Varga’s mental limitations. But a
careful dissection of the hypothetical question suggests oth-
erwise. The hypothetical question begins by positing a per-
10 No. 14-2122
son capable of performing “simple, routine, and repetitive
tasks.” These terms refer to “unskilled work,” which the
regulations define as work that can be learned by demon-
stration in less than 30 days. See 20 C.F.R. §§ 404.1568,
404.1520. As Varga notes, whether work can be learned in
this manner is unrelated to the question of whether an indi-
vidual with mental impairments—e.g., with difficulties
maintaining concentration, persistence, or pace—can per-
form such work. For this reason, we have repeatedly rejected
the notion that a hypothetical like the one here “confining
the claimant to simple, routine tasks and limited interactions
with others adequately captures temperamental deficiencies
and limitations in concentration, persistence, and pace.”
Yurt, 758 F.3d at 858-59 (citing Stewart v. Astrue, 561 F.3d 679,
685 (7th Cir. 2009) (collecting cases)); see also Craft v. Astrue,
539 F.3d 668, 677-78 (7th Cir. 2008) (restricting claimant to
unskilled, simple work does not account for his difficulty
with memory, concentration, and mood swings); Young v.
Barnhart, 362 F.3d 995, 1004 (7th Cir. 2004). The question
goes on to clarify that the individual would only be required
to perform work
free of fast paced production requirements, in-
volving only simple work related decisions
with few if any work place [sic] changes and
no more than occasional interaction with
coworkers or supervisors.
But these limitations, too, fail to account for all of Varga’s
difficulties maintaining concentration, persistence, and pace,
which, as the record shows, were related to her diagnosed
anxiety and depression, as well as her physical problems
and pain. “Few if any work place changes” with limited “in-
No. 14-2122 11
teraction with coworkers or supervisors” deals largely with
workplace adaptation, rather than concentration, pace, or
persistence. It is also problematic that the ALJ failed to de-
fine “fast paced production.” Without such a definition, it
would have been impossible for the VE to assess whether a
person with Varga’s limitations could maintain the pace
proposed.
Our recent decision in Yurt—issued after the district
court rendered its decision here—is squarely on point.
There, the applicant’s moderate limitations noted in Section I
of the MRFCA form were substantially similar to Varga’s (he
had six of the seven difficulties in concentration, persistence
and pace attributed to Varga). See 758 F.3d at 855. However,
we rejected a hypothetical almost identical to the one posed
here because it did not adequately encompass all of the limi-
tations. Id. (rejecting hypothetical that described an individ-
ual that can “remember and carry out unskilled task[s]
without special considerations … relate on at least a superfi-
cial basis with coworkers and supervisors … attend to tasks
for sufficient periods of time to complete” and who “should
not work around large numbers of people”).
Next, we address the Commissioner’s argument that at
steps two and three, the ALJ did not find Varga suffered
from moderate difficulties in all three of the categories of
concentration, persistence, and pace. The Commissioner
rests this contention on the fact that the ALJ referred to diffi-
culties in “concentration, persistence, or pace”—rather than
concentration, persistence, and pace. The Commissioner
suggests that the ALJ was referring only to concentration,
although this is nowhere expressed in the decision and is not
supported by the record, and that this impairment was cov-
12 No. 14-2122
ered by the hypothetical question posed. We disagree with
the Commissioner’s interpretation. The word “or” has an in-
clusive sense (A or B, or both) as well as an exclusive one (A
or B, not both). See GARNER DICTIONARY OF LEGAL USAGE, 3d
ed. at 639 (citing Scott J. Burnham, THE CONTRACT DRAFTING
GUIDEBOOK 163 (1992)) (noting that “or” is generally used in
the inclusive sense). For example, a hospital patient may be
asked whether he has nausea, vomiting, or cramps. If the pa-
tient responds “yes,” he may mean one, two, or all three of
the symptoms are present. Likewise, a person deemed to
have problems in “concentration, persistence, or pace” may
have problems with one, two, or all three of those categories.
Here, we find it exceedingly unlikely that the ALJ meant to
use “or” in the exclusive sense. First, the record shows Varga
suffers from difficulties in all three of these areas. Moreover,
the agency forms from which these terms emanate often
lump concentration, persistence, and pace together as an
umbrella category. The PRT form, for example, treats “con-
centration, persistence, or pace” as one broad category of
functioning. And the MRFCA form lists “sustained concen-
tration and persistence” as one category (with the other
three being “understanding and memory,” “social interac-
tion,” and “adaptation”). See also Yurt, 758 F.3d at 858 (treat-
ing “concentration, persistence, or pace” as a broad category
of mental functioning). 3
3In any event, even if the Commissioner were correct that the ALJ
found Varga only suffered from moderate difficulties in concentration
(the Commissioner does not argue that the ALJ only found difficulties in
either pace or persistence), we fail to see how Varga’s problems “main-
taining concentration for extended periods” were encapsulated by the
hypothetical question, which posited an individual able to do unskilled
No. 14-2122 13
Finally, the Commissioner argues the boxes checked by
Dr. Rattan in Section I of the MRFCA form pertaining to
concentration, persistence, and pace do not constitute medi-
cal evidence that the ALJ was required to include in his RFC
and hypothetical question to the VE. For this proposition,
the Commissioner cites Smith v. Commissioner of Social Securi-
ty, 631 F.3d 632, 637 (3d Cir. 2010), which held that an ALJ
was not required to include findings noted in Section I of the
MRFCA form that the claimant was moderately limited in
various areas of mental functioning because Section I is
merely a worksheet to aid doctors in deciding the presence
and degree of functional limitations. According to the Com-
missioner, the ALJ is only required to include findings made
at Section III of the MRFCA form, in which the doctor is to
“translate” his or her worksheet observation into a mental
RFC. See Johansen v. Barnhart, 314 F.3d 283, 286 (7th Cir.
2002). Conveniently for the Commissioner, there is no narra-
tive assessment here to which the ALJ was required to refer
because, as noted above, Dr. Rattan failed to fill out Section
III and the agency lost the electronic worksheet where he al-
legedly made Varga’s RFC assessment.
This circuit has declined to adopt a blanket rule that
checked boxes in Section I of the MRFCA form indicating
moderate difficulties in mental functioning need not be in-
corporated into a hypothetical to the VE. In fact, in Yurt, we
explicitly rejected the argument that “we should be uncon-
cerned … with the failure of the ALJ to mention the six areas
where [the state psychologist] found moderate limitations
because the narrative portion of the form adequately ‘trans-
work free of “fast paced production requirements” with limited social
interactions.
14 No. 14-2122
lated’ these limitations into a mental RFC that the ALJ could
reasonably adopt.” 758 F.3d at 858. And as noted above, the
moderate limitations attributed to the claimant in Yurt at
Section I of the MRFCA form—the exclusion of which from
the hypothetical question constituted reversible error—were
virtually identical to those attributed to Varga. See id. at 854-
55.
Worksheet observations, while perhaps less useful to an
ALJ than a doctor’s narrative RFC assessment, are nonethe-
less medical evidence which cannot just be ignored. True, in
some cases, an ALJ may rely on a doctor’s narrative RFC, ra-
ther than the checkboxes, where that narrative adequately
encapsulates and translates those worksheet observations.
See Johansen, 314 F.3d at 286. But where, as here, no narrative
translation exists—because of error on the part of the doctor
or the agency—an ALJ’s hypothetical question to the VE
must take into account any moderate difficulties in mental
functioning found in Section I of the MRFCA form, includ-
ing those related to concentration, persistence, or pace.
III. CONCLUSION
For these reasons, the judgment of the district court is
REVERSED, and this case is REMANDED with instructions that
it be returned to the SSA for further proceedings consistent
with this opinion.