I-5-4-17.Bailey, et al. v. Sullivan

A. Non-OHA Actions

1. Notification

   On February 3, 1992, SSA sent notices to all potential class members identified by computer run. Individuals had 30 days from the date of receipt of the notice to request that SSA readjudicate their claims under the terms of the Bailey court order. The computer run did not identify potential class members who received partially favorable decisions during the above-noted timeframe. Therefore, these individuals must self- identify, in writing, before July 29, 1993 (see Part IV. above). Notices returned as undeliverable will be mailed a second time if SSA obtains an updated address.

   The Office of Disability and International Operations (ODIO) and the Program Service Centers (PSCs) will send all untimely responses to the servicing Social Security field office (i.e., district office or branch office) to develop good cause for the untimely response. Good cause determinations will be based on the standards in 20 CFR §§ 404.911 and 416.1411.

2. Alert and Folder Retrieval Process

   Litigation Staff in the Office of the Deputy Commissioner for Programs will track all response forms and send folder alerts to ODIO and the PSCs to use in locating claim folders. See Attachment 2 for a sample Bailey folder alert.

   In most instances, ODIO or the PSCs will associate the Bailey file alert and the claimant's response form with the claim file(s) and forward the file(s) to the appropriate DDS (see Part III. above) for screening and readjudication.

3. Alerts Sent to OHA

   If ODIO or the PSCs determine that a current claim, i.e., either a potential class member claim or a subsequent claim, is pending appeal or stored at OHA, it will forward the alert to OHA, along with any prior claim file(s) not in OHA's possession, for screening, consolidation consideration and readjudication (if consolidated.)

   ODIO or the PSCs will forward all alerts potentially within OHA jurisdiction and related prior claim files, if any, to the Office of Appellate Operations (OAO) at the following address (case locator code 5007):

   Office of Hearings and Appeals
   Office of Appellate Operations
   One Skyline Tower, Suite 701
   5107 Leesburg Pike
   Fall Church, VA 22041-3200
   ATTN: OAO Class Action Coordinator

   NOTE:

   The OAO Class Action Coordinator is responsible for controlling and reconciling the disposition of class alerts shipped to OHA Headquarters for association with pending or stored claims. The OAO Class Action Coordinator will maintain a record of all alerts received and the location, if any, to which they are transferred. This information will be necessary to do the final class membership reconciliation.

4. Folder Reconstruction

   In general, ODIO or the PSCs will coordinate any necessary reconstruction of prior claim files. OHA requests for reconstruction of potential Bailey cases should be rare. Prior to requesting reconstruction, OHA will determine whether available systems data or other information provides satisfactory proof that the claim would not confer class membership. OHA (the HO or the OAO branch) will direct any necessary reconstruction requests to the servicing FO. The request will be made by memorandum and will include the alert and any accompanying claim file(s) (if the claim file(s) is not needed for adjudication purposes) as attachments. The request will also include documentation of the attempts to locate the file. The memorandum will request the FO to send the reconstructed file to OHA after it completes its reconstruction action. HOs will route any reconstruction requests directly to the servicing FO. The OAO branch will route reconstruction requests through the OAO Class Action Coordinator. For Civil Action Tracking System purposes, HO personnel and the OAO Class Action Coordinator will forward a copy of the reconstruction request memorandum to Litigation Staff at the following address:

   Office of the Deputy Commissioner
   for Program, Policy, Evaluation and Communications
   Litigation Staff
   3-K-26 Operations Building
   6401 Security Boulevard
   Baltimore, MD 21235
   ATTN: Bailey Coordinator

   HO personnel or the OAO branch will identify in the reconstruction request the OHA location of any existing claim file(s) being retained for adjudication purposes, and the date(s) of the claim(s) involved.

   The HO or OAO will not delay action on a pending claim when a prior claim is being reconstructed for screening purposes, unless the prior claim is needed for the adjudication of the pending claim. If OHA completes action on the pending claim prior to receipt of the reconstructed folder, the HO or OAO, as appropriate, will forward the class action material, including the alert, unneeded claim files, if any, and the reconstruction request to the OAO Class Action Coordinator, along with a copy of the action on the pending claim. For additional information on reconstruction procedures, see the Class Action Implementation instructions in HALLEX I-1-7-5 C.

5. Class Membership Denials

   The Sunbury, Pennsylvania district office, P.O. Box 266, located at Tenth and Market Streets, Second Floor, Sunbury, Pennsylvania 17801, will hold all non-class member claim folders pending review by class counsel.

   Upon review of the folders, class counsel will contact the Office of the General Counsel (OGC) directly to resolve class membership disputes.

B. OHA Actions

1. Pre-Screening Actions

   1. Current Claim in OHA

      As provided in Part V.A.3. above, if there is a current claim pending or stored at OHA Headquarters, the OAO Class Action Coordinator will receive the Bailey alert and related claim file(s). The OAO Class Action Coordinator will determine OHA jurisdiction for screening and forward as follows.

      • If the current claim is in an HO, the Coordinator will use Attachment 3 to forward the alert and any prior claim file(s) to the HO for screening. (Part V.B.2.a. below provides instructions to HOs regarding the action to be taken if they receive an alert package but no longer have a current claim pending.)

      • If the current claim is before the Appeals Council, or is located in an OAO branch mini- docket or in an OAO Docket and Files Branch, the Coordinator will use Attachment 3 to forward the alert and prior claim file(s) to the appropriate OAO branch for screening. (Part V.B.2.a. below provides instructions to the OAO branches regarding the action to be taken if they receive an alert package from the OAO Class Action Coordinator but no longer have a current claim pending.)

      If the Coordinator (or designee) is unable to locate the current claim file within OHA, the Coordinator (or designee) will broaden the claim file search and arrange for alert transfer or folder reconstruction, as necessary.

   2. Current Claim Pending in Court

      If the OAO Class Action Coordinator receives an alert for a claimant who has a civil action pending, either on the alerted case or on a subsequent or prior claim, the Coordinator will forward the alert and any accompanying claim file(s) to the appropriate OAO Court Case Preparation and Review Branch (CCPRB) for screening, using Attachment 3. (See Part V.B.2.b. below for special screening instructions when a civil action is involved.)

2. Screening

   1. General Instructions

      The screening component will associate the alert and any prior claim file(s) with the claim file(s) in its possession and complete the screening sheet (see Attachment 4) as follows:

      • consider all applications denied (including res judicata denials/dismissals) during the Bailey timeframe;

      • follow all instructions on the screening sheet;

      • sign and date the original screening sheet, place it in the claim folder (on the top right side of the folder); and

      • if the screening component is an OHA Headquarters component, forward a copy of the screening sheet to the OAO Class Action Coordinator at the address in Part V.A.3. above. (The Coordinator will enter information from the screening sheet into a database and forward a copy of the screening sheet to the Division of Litigation Analysis and Implementation (DLAI)). If the screening component is an HO, forward a copy of the screening sheet directly to DLAI at the following address:

        Office of Hearings and Appeals
        Division of Litigation Analysis and Implementation
        One Skyline Tower, Suite 702
        5107 Leesburg Pike
        Falls, Church, VA 22041-3255

        HO personnel may also forward material by telefax to DLAI at (703) 305-0655. (DLAI will retain a copy of each screening sheet and forward a copy to Litigation Staff.)

        If the HO receives an alert only, or an alert associated with a prior claim file(s), and the HO no longer has the current claim file, it will return or forward the alert and any prior claim file(s) to the OAO Class Action Coordinator (see address in Part V.A.3. above) and advise the Coordinator of the action taken on the current claim and its destination. The Coordinator will determine the current claim file location and, if it is located in OHA Headquarters, will forward the alert and any accompanying prior claim file(s) to the responsible OAO Branch for screening using Attachment 3. If the file(s) is no longer in OHA, the Coordinator will use Attachment 5 to send the alert and any accompanying prior claim file(s) to the non-OHA location and request that the file(s) be forwarded to the appropriate DDS for screening.

        If an OAO branch receives an alert only, or an alert associated with a prior claim file(s), and the branch no longer has the current claim file (and it is not located in an OAO branch mini-docket or an OAO Docket and Files Branch), it will determine the location of the current claim file. If the current claim file is located within OHA, the OAO branch will use Attachment 3 to forward the alert and any accompanying prior claim file(s) to the current OHA location. If the files are no longer in OHA, the OAO branch will use Attachment 5 to send the alert and any accompanying prior claim file(s) to the non-OHA location and request that the file(s) be forwarded to the appropriate DDS for screening. The OAO branch will also advise the OAO Class Action Coordinator of its actions.

        NOTE:

        Final determinations or decisions made after November 30, 1984, on a claim filed by a potential Bailey class member may adjudicate the same timeframe covered by the Bailey claim. Instead of applying the doctrine of administrative res judicata to the Bailey claim, these claims should be denied class membership.

   2. Special OAO Screening Instructions if a Civil Action Is Involved

      As noted in Part V.B.1. above, the CCPRB will screen for Bailey class membership when a civil action is involved. The CCPRB's class membership determination will dictate the appropriate post-screening action.

      • If the claim pending in court was adjudicated in accordance with SSR 85-28 and resolved all Bailey issues, the claimant is not a Bailey class member entitled to relief. The CCPRB will follow the instructions in Part V.B.3.a. below for processing non-class member claims.

      • If the claim pending in court was adjudicated in accordance with SSR 85-28, but did not resolve all Bailey issue(s), e.g., there is a prior (inactive) Bailey claim and the claim pending in court did not include the entire period covered by the Bailey claim, and the claimant elects to have the case remanded to the Secretary for a redetermination (instead of proceeding in court), the CCPRB will forward the Bailey claim to the appropriate DDS (see Part III. above) for separate review. The CCPRB will modify the case flag in Attachment 9 to indicate that the pending court case does not resolve all Bailey issues and that the Bailey class member claim is being forwarded for separate processing. The CCPRB will notify the Class Action Coordinator of this action.

      • If the final administrative decision on the claim pending in court was not adjudicated in accordance with SSR 85-28 or is legally insufficient for other reasons, the CCPRB will initiate voluntary remand proceedings and consolidate the claims.

        NOTE:

        The CCPRB will immediately notify OGC if the pending court case is a Bailey class member claim so that OGC can notify the claimant of the option to have the case remanded for readjudication.

3. Post-Screening Actions

   1. Non-Class Member Cases

      If the screening component determines that the individual is not a class member, the component will:

      • notify the individual, and representative, if any, using Attachment 6, of the non-class membership determination and the right to contact or write class counsel for additional review (modify Attachment 6 as necessary to fit the circumstances and posture of the case when there is a current claim);

      • include a postage prepaid postcard (that OHA Headquarters will supply), addressed to class counsel, as an accompaniment to the non-class membership determination notice;

      • retain a copy of the notice in the claim folder;

      • send a copy of the notice to:

        Peter B. Macky, Esq.
        Susquehanna Legal Services
        206 Arch Street
        Sunbury, Pennsylvania 17801
        Attn: Bailey

      • send the non-class member claim folder(s) to the Sunbury, Pennsylvania district office using the pre-addressed route slip in Attachment 7.

      NOTE:

      Photocopy any material in the prior folder that is relevant to the pending current claim and place it in the current claim folder before shipping the prior folder.

      An individual who wishes to appeal a determination of non-class membership may do so only through class counsel, as explained in the notice (Attachment 6).

   2. Cases Determined to be Class Members

      If the screening component determines that the individual is a class member, the component will proceed with processing and adjudication in accordance with the instructions in Part VI. below.

A. Cases Reviewed by the DDS

The DDS will conduct the first Bailey review except for cases consolidated at the OHA level (see Part VI.D. below). The DDS determination will be a reconsideration determination, regardless of the administrative level at which the class member claim(s) was previously decided, with full appeal rights (i.e., ALJ hearing, Appeals Council and judicial review). Except as otherwise noted in this instruction, ALJs should process and adjudicate requests for hearing on Bailey DDS review cases in the same manner as for any other case.

B. OHA Adjudication of Class Member Claims

The following instruction applies to both consolidation cases in which the ALJ or Appeals Council conducts the Bailey readjudication and to DDS readjudication cases in which the claimant requests a hearing or Appeals Council review. Except as noted herein, HOs and Headquarters will process Bailey class member cases according to all other current practices and procedures including coding, scheduling, developing evidence, routing, etc.

1. Type of Review and Period to be Considered

   1. Pursuant to the Bailey order, regardless of whether the claim under review is an initial claim or cessation case, the type of review to be conducted is a redetermination. The readjudication shall be a de novo reevaluation of the class member's eligibility for benefits based on evidence in his or her file, including newly obtained evidence, relevant to the period that was at issue in the administrative decision(s) that forms the basis of the Bailey class membership. Evidence will be reviewed:

      • in title II denial cases - from the seventeenth month prior to the date of the original application, or date of earliest alleged onset of disability, whichever is later, through the date of the latest administrative decision resulting in class membership;

      • in title XVI denial cases - from the original date of application for the earliest Bailey claim through the date of the latest administrative decision resulting in class membership; and

      • in title II/title XVI cessation cases - from the date of the termination of disability benefits through the date of the latest administrative decision resulting in class membership.

   2. If the readjudication results in a favorable decision, the adjudicator will determine, under the medical improvement standard, whether the class member's disability has continued through the date of the readjudication (or through the date of onset of disability established in any allowance on a subsequent application).

   3. If the evidence establishes that disability began only at some point after the administrative decision(s) that forms the basis of the Bailey class membership, the class member must file a new application to establish eligibility. Use the standards in 20 CFR §§ 404.621 and 416.335 in determining whether a new application is timely filed.

2. Step Two of the Sequential Evaluation

   Bailey does not require any change in OHA's current adjudicatory policies or practices with respect to step two of the sequential evaluation. Effective with the enactment of the 1984 Amendments to the Social Security Act, OHA's adjudicators have considered the combined effect of individual “not severe” impairments in evaluating disability claims at step two. ALJs and the Appeals Council may, if appropriate, continue to deny or cease the disability claims of Delaware and Pennsylvania residents in accordance with 20 CFR §§ 404.1520(c), 404.1521, 416.920(c) and 416.921, as well as SSR 85-28. The then Acting Associate Commissioner's memorandum, dated February 21, 1991 (Attachment 8), regarding the proper standard for adjudicating claims at step two, remains in effect.

3. Class Member is Deceased

   If a class member is deceased, the usual survivor and substitute party provisions and existing procedures for determining distribution of any potential underpayment apply.

C. Claim at OHA But No Current Action Pending

If the claim folder (either a class member or a subsequent claim) is located in OHA Headquarters, but there is no claim actively pending administrative review, i.e., Headquarters is holding the folder awaiting potential receipt of a request for review or notification that a civil action has been filed, OAO will associate the alert with the folder and screen for class membership (the OAO Class Action Coordinator will coordinate the necessary actions, as explained above in Part V.) (See Part V. B. 3. above, for non-class member processing instructions.)

• If the 120-day retention period for holding a claim folder after an ALJ decision or Appeals Council action has expired, OAO will attach a Bailey class member flag (see Attachment 9) to the outside of the folder and send the claim folder(s) to the appropriate DDS (see Part III. above) for review of the Bailey class member claim.

• If fewer than 120 days have elapsed, OAO will attach a Bailey class member flag to the outside of the folder (see Attachment 9) to ensure that the case is routed to the appropriate DDS (see Part III. above) after expiration of the retention period. Pending expiration of the retention period, OAO will also:

  • return unappealed ALJ decisions and dismissals to DFB, OAO; and

  • return unappealed Appeals Council denials to the appropriate OAO minidocket.

• The respective OAO components will monitor the retention period and, if the claimant does not seek further administrative or judicial review, route the folder(s) to the appropriate DDS (see Part III. above) in a timely manner.

D. Processing and Adjudicating Class Member Claims in Conjunction with Current Claims (Consolidation Procedures)

1. General

   If a class member has a current claim pending at any administrative level and consolidation is warranted according to the guidelines below, the appropriate component will consolidate all Bailey class member claims with the current claim at the level at which the current claim is pending.

2. Current Claim Pending in the Hearing Office

   1. Hearing Has Been Scheduled or Held, and All Remand Cases

      Except as noted below, if a Bailey class member has an initial request for hearing pending on a current claim, and the ALJ has either scheduled or held a hearing, and in all remand cases, the ALJ will consolidate the Bailey case with the appeal on the current claim.

      EXCEPTIONS:

      The ALJ will not consolidate the claims if

      • • the current claim and the Bailey claim do not have any issue(s) in common. For example:

        • • if the current claim is a title II retirement or survivor's insurance benefits claim or a title XVI claim involving only nondisability issues, e.g., income, resources or residency, it will not have any issue(s) in common with the Bailey claim; however, if the current claim is a disability claim, for consolidation purposes, it will have an issue in common with the Bailey claim, regardless of the period at issue or the title under which the current claim was filed;

            or

        • a court remand contains a court-ordered time limit and it will not be possible to meet the time limit if the claims are consolidated.

      If the claims are consolidated, follow Part VI.D.2.c. below. If the claims are not consolidated, follow Part VI.D.2.d. below.

   2. Hearing Not Scheduled

      Except as noted below, if a Bailey class member has an initial request for hearing pending on a current claim and the HO has not yet scheduled a hearing, the ALJ will not consolidate the Bailey claim and the current claim. Instead, the ALJ will dismiss the request for hearing on the current claim and forward both the Bailey claim and the current claim to the DDS for further action (see Part VI.D.2.d. below).

      EXCEPTION:

      If the hearing has not been scheduled because the claimant waived the right to an in-person hearing, and the ALJ is prepared to issue a fully favorable decision on the current claim, and this decision would also be fully favorable with respect to all issues raised by the application that makes the claimant a Bailey class member, the ALJ will consolidate the claims.

      If the claims are consolidated, follow Part VI.D.2.c. below. If the claims are not consolidated, follow Part VI.D.2.d. below.

   3. Action if Claims Consolidated

      If the ALJ decides to consolidate the current claim with the Bailey claim(s), the HO will:

      • give proper notice of any new issue(s) as required by 20 CFR §§ 404.946(b) and 416.1446(b), if the Bailey claim raises any additional issue(s) not raised by the current claim;

      • offer the claimant a supplemental hearing if the ALJ has already held a hearing and the Bailey claim raises any additional issue(s), unless the ALJ is prepared to issue a fully favorable decision with respect to the Bailey claim;

      • issue one decision that addresses both the issues raised by the current request for hearing and those raised by the Bailey claim (the ALJ's decision will clearly indicate that the ALJ considered the Bailey claim pursuant to the Bailey court order); and

      • send copies of the consolidated hearing decision to both:

        Office of Hearings and Appeals
        Division of Litigation Analysis and Implementation
        P.O. Box 10723
        Arlington, VA 22210
        ATTN: Bailey Coordinator
        Suite 702

        and

        Litigation Staff
        Office of the Deputy Commissioner
        for Programs, SSA
        P.O. Box 17729
        Baltimore, Maryland 21235
        ATTN: Bailey Coordinator

   4. Action if Claims Not Consolidated

      If common issues exist but the ALJ decides not to consolidate the current claim with the Bailey claim because a hearing has not yet been scheduled, the HO will:

      • dismiss the request for hearing on the current claim without prejudice, using the language in Attachment 10 and the covering notice in Attachment 11; and

      • send both the Bailey claim and the current claim to the appropriate DDS for consolidation and further action (see Part III. above).

      If the ALJ decides not to consolidate the current claim with the Bailey claim because: 1) the claims do not have any issue(s) in common, or 2) there is a court-ordered time limit, the ALJ will:

      • flag the Bailey claim for DDS review using Attachment 12; immediately route it to the appropriate DDS (see Part III. above) for adjudication; and retain a copy of Attachment 12 in the current claim folder; and

      • take the necessary action to complete the record and issue a decision on the current claim.

3. Current Claim Pending at the Appeals Council

   The action the Appeals Council takes on the current claim determines the disposition of the Bailey claim. Therefore, OAO must keep the claim folders together until the Appeals Council completes its action on the current claim. The following sections identify the possible Appeals Council actions on the current claim and the appropriate corresponding action on the Bailey claim.

   1. Appeals Council Intends to Dismiss, Deny Review or Issue a Denial Decision on the Current Claim — No Bailey Issue(s) Will Remain Unresolved.

      This will usually arise when the current claim duplicates the Bailey review claim, i.e., the Bailey claim raises an issue of disability for a period covered by the current claim, and the current claim has been adjudicated in accordance with the provisions of SSR 85-28. In this instance, the Appeals Council will consolidate the claims and proceed with its intended action. The Appeals Council's order, decision or notice of action will clearly indicate that the ALJ's or Appeals Council's action resolved or resolves both the current claim and the Bailey claim.

   2. Appeals Council Intends to Dismiss, Deny Review or Issue a Denial Decision on the Current Claim — Bailey Issue(s) Will Remain Unresolved.

      This will usually arise when the current claim does not duplicate the Bailey claim, e.g., the Bailey claim raises an issue of potential entitlement to disability benefits for a period prior to the period adjudicated in the current claim. In this instance, the Appeals Council will proceed with its intended action on the current claim in accordance with the provisions of SSR 85-28.

      OAO staff will attach a Bailey case flag (Attachment 9) to the Bailey claim, immediately forward the Bailey claim to the appropriate DDS (see Part III. above) for adjudication, and retain a copy of Attachment 9 in the current claim file. OAO will modify Attachment 9 to indicate that the Appeals Council action on the current claim does not resolve all Bailey issues and that the Bailey class member claim is being forwarded for separate processing. OAO staff will include copies of the ALJ or Appeals Council decision or order on the current claim and the exhibit list used for the ALJ or Appeals Council decision.

   3. Appeals Council Intends to Issue a Favorable Decision on the Current Claim — No Bailey Issue(s) Will Remain Unresolved.

      If the Appeals Council intends to issue a fully favorable decision on a current claim, and this decision would be fully favorable with respect to all issues raised by the application that makes the claimant a Bailey class member, the Appeals Council will proceed with its intended action. In this instance, the Appeals Council will consolidate the claims, reopen the final determination or decision on the Bailey claim and issue a decision that adjudicates both applications. The Appeals Council's decision will clearly indicate that the Appeals Council considered the Bailey claim pursuant to the Bailey court order. For class action reporting purposes, the Appeals Council will send copies of its decision to the Bailey coordinators listed in Part VI.D.2.c. above.

   4. Appeals Council Intends to Issue a Favorable Decision on the Current Claim — Bailey Issue(s) Will Remain Unresolved.

      If the Appeals Council intends to issue a favorable decision on a current claim and this decision would not be fully favorable with respect to all issues raised by the Bailey claim, the Appeals Council will proceed with its intended action. In this instance, the Appeals Council will request the effectuating component to forward the claim folders to the appropriate DDS (see Part III. above) after the Appeals Council's decision is effectuated. OAO staff will include the following language on the transmittal sheet used to forward the case for effectuation: “Bailey court case review needed — following effectuation, forward the attached combined folders to (insert address of the DDS having jurisdiction for review of the Bailey class member claim).”

   5. Appeals Council Intends to Remand the Current Claim to an ALJ.

      If the Appeals Council intends to remand the current claim to an ALJ, it will proceed with its intended action, and include consolidation instructions, unless one of the exceptions below applies. In its remand order, the Appeals Council will direct the ALJ to consolidate the Bailey claim with the action on the current claim pursuant to the instructions in Part VI.D.2.a. above.

   EXCEPTIONS:

   The Appeals Council will not direct the ALJ to consolidate the claim if

   • the current claim and the Bailey claim do not have any issue(s) in common. For example:

     • if the current claim is a title II retirement or survivor's insurance benefits claim or a title XVI claim involving only nondisability issues, e.g., income, resources or residency, it will not have any issue(s) in common with the Bailey claim; however, if the current claim is a disability claim, for consolidation purposes, it will have an issue in common with the Bailey claim, regardless of the period at issue or the title under which the current claim was filed;

       or

   • a court remand contains a court-ordered time limit and it will not be possible to meet the time limit if the claims are consolidated.

   If the claims do not share a common issue or a court-ordered time limit makes consolidation impractical, OAO will forward the Bailey class member claim to the appropriate DDS (see Part III. above) for separate review. The case flag in Attachment 12 should be modified to indicate that the Appeals Council, rather than an ALJ, is forwarding the Bailey class member claim for separate processing.

E. Copy Requirements

For all cases in which OHA is the first level of review for the Bailey claim (i.e., the Appeals Council or an ALJ consolidates the Bailey claim with action on a current claim or a class member only claim is pending at OHA), HO, or OAO personnel, as appropriate, will send a copy of any OHA decision to the Bailey coordinators at the addresses listed in Part VI.D.2.c. above.