Lounsburry v. Barnhart , 464 F.3d 944 ( 2006 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
BEATRIZ V. LOUNSBURRY, 
Plaintiff-Appellant, No. 04-15690
v.
 D.C. No.
CV-02-03956-JSW
JO ANNE B. BARNHART,
Commissioner of Social Security, OPINION
Defendant-Appellee.

Appeal from the United States District Court
for the Northern District of California
Jeffrey S. White, District Judge, Presiding
Argued and Submitted
February 17, 2006—San Francisco, California
Filed September 20, 2006
Before: Procter Hug, Jr., Arthur L. Alarcón, and
M. Margaret McKeown, Circuit Judges.
Opinion by Judge Hug
11733
11736 LOUNSBURRY v. BARNHART
COUNSEL
Kelly Dunn, Richmond, California, for the appellant.
Sarah Ryan, Assistant Regional Counsel, United States Social
Security Administration, San Francisco, California, for the
appellee.
LOUNSBURRY v. BARNHART 11737
OPINION
HUG, Circuit Judge:
Beatriz V. Lounsburry (“Lounsburry”) appeals the district
court’s judgment affirming the Commissioner of Social
Security’s decision to deny her disability benefits under Title
II of the Social Security Act. Lounsburry’s application for
benefits was denied initially and on reconsideration, and
Lounsburry requested a hearing before an administrative law
judge (“ALJ”). The ALJ found that although Lounsburry had
severe exertional and non-exertional impairments that pre-
cluded her performing her previous work, these impairments
were not disabling because they did not preclude Lounsburry
from performing a single occupation that existed in significant
numbers in the economy. Lounsburry contends that the ALJ
committed legal error because Rule 202.00(c) of the Medical-
Vocational Guidelines, as applied to the ALJ’s uncontested
findings of fact, directs as a matter of law a determination that
Lounsburry is disabled. We agree, and hereby REVERSE and
REMAND WITH INSTRUCTIONS for the payment of bene-
fits.
I. Factual And Procedural Background
On February 24, 2000, Lounsburry filed a claim for Social
Security Disability Insurance (“SSDI”) under Title II of the
Social Security Act, 42 U.S.C. §§ 401 et seq. Lounsburry
alleged that her disability arose on August 16, 1999, when she
was sixty-two years of age. As the basis of her disability,
Lounsburry alleged “easy fatigue, pains & discomforts on
[the] upper and lower extremities, severe pain in both hips,
joints, back & shoulder, not feeling well at times, [and] bunio-
nous . . . toes.” A series of medical evaluations between May
1999 and December 2000 resulted in diagnoses of (1) degen-
erative joint disease, resulting in chronic bilateral lower
extremity, knee, ankle, heel, and foot pain, and pain in the
lumbar spine, (2) adult-onset diabetes mellitus, (3) hyperten-
11738 LOUNSBURRY v. BARNHART
sion, and (4) sick sinus syndrome — for which Lounsburry
received a permanent dual-chamber pacemaker implant.
Lounsburry completed high school and two years of post-
secondary education. She was employed as a certified nurse’s
assistant from October 1985 to May 1999 and was employed
as a certified home health aide from June 1998 to November
1999. She has not engaged in substantial gainful activity at
any time since the alleged onset of her disability.
Lounsburry’s application for social security disability
insurance was denied initially and on reconsideration. At the
hearing before the ALJ on November 20, 2001, medical-
vocational testimony revealed Lounsburry to have the residual
functional capacity to perform “light work,” defined as lifting
and/or carrying 15 pounds frequently and 25 pounds occa-
sionally. A vocational expert (“VE”) indicated that Louns-
burry also had postural limitations preventing her from
repetitive stooping, crouching, crawling, kneeling, and climb-
ing activities. Because Lounsburry’s past relevant work as a
certified nurse’s assistant requires a medium exertional capac-
ity, the VE testified she would not be able to return to that
job. The VE did find, however, that Lounsburry’s past work
was semi-skilled and involved skills transferable to other
work. Specifically, the VE identified four jobs that Louns-
burry could do, but in response to interrogatories propounded
by the ALJ, later eliminated all but one as requiring more than
“very little [vocational] adjustment,” pursuant to the require-
ments of the Medical-Vocational Guidelines, 20 C.F.R. Part
404, Subpart P, App. 2, Rule 202.00(f) (“the grids”).
The VE identified the remaining occupation, “companion,”
as semi-skilled, requiring light exertional capacity and very
little vocational adjustment. He testified that 1,639 companion
positions exist in the local economy, and 65,855 nationally.
The ALJ followed the five-step sequential evaluation required
LOUNSBURRY v. BARNHART 11739
by 20 C.F.R. § 404.1520. He determined in his written deci-
sion dated March 25, 2002 that Lounsburry was not disabled.1
The Social Security Appeals Council declined review and
adopted the ALJ’s decision as the final decision of the Com-
missioner. Having exhausted her administrative remedies,
Lounsburry sought review in the Northern District of Califor-
nia. District Judge White rejected Lounsburry’s argument that
the ALJ was required to apply the Medical-Vocational Guide-
lines directly, including Rule 202.00(c), denied her motion for
summary judgment, and granted the Commissioner’s cross-
motion for summary judgment, thereby upholding the ALJ’s
decision.
II. A Medical-Vocational Guidelines Analysis
We review de novo the decision of the district court affirm-
ing the decision of the ALJ. Aukland v. Massanari, 257 F.3d
1033, 1034-1035 (9th Cir. 2001). We may set aside the Com-
missioner’s denial of disability insurance benefits when the
ALJ’s findings are based on legal error. See Penny v. Sullivan,
2 F.3d 953, 956 (9th Cir. 1993). In this appeal we are called
on to determine Lounsburry’s disability status under the
Medical-Vocational Guidelines, commonly referred to as the
grids. 20 C.F.R. Part 404, Subpt. P, App. 2.
[1] The Ninth Circuit articulated the five-step sequential
process for determining whether a claimant is “disabled” in
Tackett v. Apfel, 180 F.3d 1094, 1098-99 (9th Cir. 1999). The
five steps are as follows:
1
The ALJ determined that Lounsburry (1) was not participating in sub-
stantial gainful activity; (2) had severe impairments; (3) did not have
impairments meeting the criteria of 20 C.F.R. pt. 404, subpt. P, app.1; (4)
possessed a residual functional capacity for only light work limited by
postural restrictions and was thus unable to perform “past relevant work;”
and (5) could make the adjustment to other work that existed in significant
numbers in the national economy because she had skills transferable to the
occupation “companion.”
11740 LOUNSBURRY v. BARNHART
Step 1: Is the claimant presently working in a sub-
stantially gainful activity? If so, then the claimant is
“not disabled” within the meaning of the Social
Security Act and is not entitled to disability insur-
ance benefits. If the claimant is not working in a sub-
stantially gainful activity, then the claimant’s case
cannot be resolved at step one and the evaluation
proceeds to step two. See 20 C.F.R. § 404.1520(b).
Step 2: Is the claimant’s impairment severe? If not,
then the claimant is “not disabled” and is not entitled
to benefits. If the claimant’s impairment is severe,
then the claimant’s case cannot be resolved at step
two and the evaluation proceeds to step three. See 20
C.F.R. § 404.1520(c).
Step 3: Does the impairment “meet or equal” one of
a list of specific impairments described in the regula-
tions? If so, the claimant is “disabled” and therefore
entitled to disability insurance benefits. If the claim-
ant’s impairment neither meets nor equals one of the
impairments listed in the regulations, then the claim-
ant’s case cannot be resolved at step three and the
evaluation proceeds to step four. See 20 C.F.R.
§ 404.1520(d).
Step 4: Is the claimant able to do any work that he
or she has done in the past? If so, then the claimant
is “not disabled” and is not entitled to disability
insurance benefits. If the claimant cannot do any
work he or she did in the past, then the claimant’s
case cannot be resolved at step four and the evalua-
tion proceeds to the fifth and final step. See 20
C.F.R. § 404.1520(e).
Step 5: Is the claimant able to do any other work? If
not, then the claimant is “disabled” and therefore
entitled to disability insurance benefits. See 20
LOUNSBURRY v. BARNHART 11741
C.F.R. § 404.1520(f)(1). If the claimant is able to do
other work, then the Commissioner must establish
that there are a significant number of jobs in the
national economy that claimant can do. There are
two ways for the Commissioner to meet the burden
of showing that there is other work in “significant
numbers” in the national economy that claimant can
do: (1) by the testimony of a vocational expert, or (2)
by reference to the Medical-Vocational Guidelines at
20 C.F.R. pt. 404, subpt. P, app. 2. If the Commis-
sioner meets this burden, the claimant is “not dis-
abled” and therefore not entitled to disability
insurance benefits. See 20 C.F.R. §§ 404.1520(f),
404.1562. If the Commissioner cannot meet this bur-
den, then the claimant is “disabled” and therefore
entitled to disability benefits.
Id.; see also Tackett, 180 F.3d 1098-99.
[2] The grids are applied at the fifth step of the analysis
under 20 C.F.R. § 404.1520, and present, in table form, a
short-hand method for determining the availability and num-
bers of suitable jobs for a claimant. Tackett, 180 F.3d at 1101.
The grids categorize jobs by their physical-exertional require-
ments, and set forth a table for each category. A claimant’s
placement with the appropriate table is determined by apply-
ing a matrix of four factors identified by Congress—a claim-
ant’s age, education, previous work experience, and physical
ability. For each combination of these factors, they direct a
finding of either “disabled” or “not disabled” based on the
number of jobs in the national economy in that category of
physical-exertional requirements. Id. If a claimant is found
able to work jobs that exist in significant numbers, the claim-
ant is generally considered not disabled. Heckler v. Campbell,
461 U.S. 458, 461 (1983).
However, the grids are predicated on a claimant suffering
from an impairment which manifests itself by limitations in
11742 LOUNSBURRY v. BARNHART
meeting the strength requirements of jobs (“exertional limita-
tions”); they may not be fully applicable where the nature of
a claimant’s impairment does not result in such limitations
(“non-exertional limitations”). 20 C.F.R. Part 404, Subpart p,
Appx. 2 § 200.00(e); 30 Fed. Proc., L. Ed. § 71:205. The rea-
son for this limitation on the grids’ application is that, despite
having the residual functional capacity to perform a full range
of unskilled occupations at a given exertional level, a claimant
may not be able to adjust to these jobs because of non-
exertional limitations. Soc. Sec. Rul. 83-10 (January 1983). In
particular, non-exertional impairments — including postural
and manipulative limitations such as difficulty reaching, han-
dling, stooping, climbing, crawling, or crouching—may, if
sufficiently severe, limit a claimant’s functional capacity in
ways not contemplated by the grids. 20 C.F.R. § 404.1569;
Tackett, 180 F.3d at 1101-02 (quoting Desrosiers v. Sec’y of
Health & Human Servs., 846 F.2d 573, 577 (9th Cir. 1988)
(Pregerson, J., concurring)). Thus, the Tackett court held that
“[t]he grids should be applied only where a claimant’s func-
tional limitations fall into a standardized pattern ‘accurately
and completely’ described by the grids.” Id. at 1103; see also
Burkhart, 856 F.2d 1335, 1340 (9th Cir. 1988) (concluding
that the use of “the grids will be inappropriate where the pred-
icate for using the grids — the ability to perform full range
of either medium, light or sedentary activities—is not pres-
ent.”).2
[3] Application of the grids is not discretionary here. Where
2
Tackett’s bar on exclusive reliance on the grids is limited by its
requirement that the nonexertional impairments invoked must be signifi-
cant enough to limit further the range of work permitted by exertional lim-
itations before precluding application of the grids. Tackett, 180 F.3d at
1104; Desrosiers v. Secretary of Health and Human Servs., 846 F.2d 573,
577 (9th Cir. 1988). Although the ALJ had not determined Lounsburry’s
postural restrictions were severe, the district court reasoned that this ele-
ment could be inferred, and the “ALJ was not required to use the grids
because Lounsburry’s non-exertional limitations made it such that her
abilities were not completely and accurately represented by the grid.”
LOUNSBURRY v. BARNHART 11743
a claimant suffers only exertional limitations, the ALJ must
consult the grids. Cooper v. Sullivan, 880 F.2d 1152, 1155
(9th Cir. 1989). Where a claimant suffers only non-exertional
limitations, the grids are inappropriate, and the ALJ must rely
on other evidence. Id. Where a claimant suffers from both
exertional and non-exertional limitations, the ALJ must con-
sult the grids first. Id. However, the grids provide that:
where an individual has an impairment or combina-
tion of impairments resulting in both strength limita-
tions and nonexertional limitations, the rules in this
subpart are considered in determining first whether
a finding of disabled may be possible based on the
strength limitations alone. . . .
20 C.F.R. Part 404, Subpart P, App. 2, § 200.00(e)(2) (2006)
(emphasis added). And conspicuously, “[W]here application
of the grids directs a finding of disability, that finding must
be accepted by the Secretary . . . whether the impairment is
exertional or results from a combination of exertional and
non-exertional limitations.” Cooper v. Sullivan, 880 F.2d
1152, 1157 (9th Cir. 1989) (emphasis added). Because the
grids are not designed to establish automatically the existence
of jobs for persons with both severe exertional and non-
exertional impairments, they may not be used to direct a con-
clusion of nondisability.3 See Tackett v. Apfel, 180 F.3d 1094,
1102 (9th Cir. 1999). In other words, where a person with
exertional and non-exertional limitations is “disabled” under
the grids, there is no need to examine the effect of the non-
exertional limitations. But if the same person is not disabled
under the grids, the non-exertional limitations must be exam-
3
The cases cited by the Commissioner for the proposition that the ALJ
was entitled to bypass the grids are inapplicable because they “hold only
that [the Commissioner] may not rely solely on the grids to deny benefits
when additional impairments detract from a claimant’s ability to work.”
Cooper v. Sullivan, 880 F.2d 1152, 1156 (9th Cir. 1989) (emphasis
added).
11744 LOUNSBURRY v. BARNHART
ined separately. An individual with both exertional and non-
exertional limitations cannot, however, be found “non-
disabled” based only on the grids.
Here, the ALJ declined to apply the grids, except as an
advisory framework, because Lounsburry’s residual func-
tional capacity was further reduced by her severe non-
exertional, postural limitations. This was error; the ALJ
should have first inquired if Lounsburry was disabled under
the grids on the basis of her exertional limitations alone. The
ALJ also relied on testimony from the vocational expert in
concluding that Lounsburry was not disabled. This was also
error; the ALJ should not have substituted extrinsic evidence
for the mandatory analysis under the grids.
It is Social Security Administration policy that the ALJ
may not look to other evidence to rebut this conclusion. Soc.
Sec. Rul. 83-5a. Under no circumstances may a vocational
expert’s testimony supplant or override a disability conclusion
dictated by the Guidelines. See Swenson v. Sullivan, 876 F.2d
683, 688 (9th Cir. 1989). In other words, the grids serve as a
ceiling. establishing a claimant’s maximum functional capac-
ity. Cooper, 880 F.2d at 1156. Before turning to a vocational
expert, the ALJ should have analyzed whether Lounsburry’s
exertional impairments were enough, by themselves, to war-
rant a finding of disabled.
III. Assessing Lounsburry Under the Grids
With the benefit of a complete analysis under the grids, it
is clear that Lounsburry is disabled. The ALJ’s factual find-
ings are not in dispute. Lounsburry’s residual functional
capacity to perform light work prevents her return to past
work but includes some transferable skills. Ignoring Louns-
burry’s non-exertional limitations, we hold that this medical-
vocational profile qualifies Lounsburry as disabled.
[4] Because she has transferrable skills, Lounsburry’s case
is controlled by grid Rule 202.07, which generally directs a
LOUNSBURRY v. BARNHART 11745
finding of “not disabled.” However, the ALJ misapplied Rule
202.07 by failing to consider fully the effect of Rule
202.00(c). Footnote (2) to Rule 202.07 explicitly incorporates
language from Rule 202.00(c) that expands the circumstances
under which claimants with transferable skills can be found
disabled. Rule 202.00(c) provides:
(c) However, for individuals of advanced age who
can no longer perform vocationally relevant past
work and who have a history of unskilled work
experience, or who have only skills that are not
readily transferable to a significant range of semi-
skilled or skilled work that is within the individual’s
functional capacity, or who have no work experi-
ence, the limitations in vocational adaptability repre-
sented by functional restriction to light work warrant
a finding of disabled.
(emphasis added)
Under Rule 202.00(c), although Lounsburry has some
transferable skills, she will be disabled if those skills “are not
readily transferable to a significant range of semi-skilled or
skilled work.” Thus, the specific issue we confront is the
meaning of the phrase “significant range of work.” The Com-
missioner takes the position that the term “work” refers to
individual jobs, and the phrase “significant range” only
requires Lounsburry to adjust to other work existing in signif-
icant numbers in the national economy in one or more occu-
pations. However, the term “work” under Rule 202.00(c)
means distinct occupations, and “significant numbers” is no
substitute for and cannot satisfy the plain language of Rule
202.00(c) requiring a “significant range of . . . work” (empha-
sis added).
[5] Social Security Ruling 83-10 (1983) (“SSR 83-10”)
“address[es] the issue of capability to do other work” by pro-
viding “definitions of terms and concepts frequently used in
evaluating disability under the medical-vocational rules.” Id.
11746 LOUNSBURRY v. BARNHART
at *1. Id. At 17. SSR 83-10 defines the phrase, “Range of
Work,” as “Occupations existing at an exertional level.” It
defines the related phrase, “Full Range of Work,” as: “All or
substantially all occupations existing at an exertional level.”
Id. at *16 (emphasis added). We thus construe the phrase
“significant range of . . . work” in Rule 202.00(c) to require
a significant number of occupations. The record in this case
establishes that Lounsburry’s skills would transfer to pre-
cisely one occupation at her residual functional capacity. One
occupation does not constitute a significant range of work.
Rule 202.00(c) directs a finding of disability for Lounsburry.
The Commissioner’s reliance on 20 C.F.R. § 404.1566(b)
(2004), which provides that “[w]ork exists in the national
economy when there is a significant number of jobs (in one
or more occupations),” is misplaced. In whatever manner
“work” is defined, Rule 202.00(c) demands a “significant
range of” it. To interpret “significant range of . . . work” to
mean simply “work” nullifies the concept of “range” con-
tained in the text. Congress might have drafted Rule 202.00(c)
to require only a “significant number of jobs”; it chose not to
do so.
Furthermore, 20 C.F.R. § 404.1566(b) is inapplicable to
Lounsburry’s case. It defines “work” at a high level of gener-
ality and only to operationalize the broad definition of disabil-
ity articulated by the Commissioner in interpreting a different
statute 42 U.S.C. § 423(d)(2)(A).4 However, the purpose of
4
Section 423(d)(2)(A) provides:
An individual shall be determined to be under a disability only
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, considering his age, education, and work experience,
engage in any other kind of substantial gainful work which exists
in the national economy. . . . For purposes of the preceding sen-
tence (with respect to any individual), “work which exists in the
national economy” means work which exists in significant num-
bers either in the region where such individual lives or in several
regions of the country.” (emphasis added).
LOUNSBURRY v. BARNHART 11747
the grids is to individualize the disability determination pro-
cess; the grids supply the test for satisfying § 423(d)(2)(A) in
particular cases. The Commissioner may not substitute a defi-
nition of disability applicable generally for one narrowly tai-
lored by the grids to Lounsburry’s circumstances.
For the foregoing reasons, Lounsburry is disabled under the
Medical-Vocational Guidelines and eligible to receive disabil-
ity insurance benefits as a matter of law.
REVERSED and REMANDED WITH INSTRUCTIONS
for the payment of benefits.