MEMORANDUM DECISION AND ORDER
Maria Horsewood ("Petitioner") seeks review of the Commissioner of the Social Security Administration's final decision terminating Petitioner's disability benefits and ordering Petitioner to repay approximately $126,500 in overpaid benefits. The Court has reviewed the Petition for Review and the Answer, the parties' memoranda, and the administrative record ("AR"), and for the reasons that follow, will remand to the Commissioner with further instructions.
PROCEDURAL AND FACTUAL HISTORY
Petitioner filed an application for Social Security Disability Insurance (SSDI) benefits and Supplemental Security Income on October 30, 1989, alleging that she had been disabled since February 1, 1989. Her claim was denied on December 21, 1989. She did not appeal the denial. Petitioner filed another claim for a period of disability and disability insurance benefits on March 28, 1990. In July of 1990, Petitioner was found to be disabled as of December 22, 1989, due to a combination of juvenile onset diabetes mellitus and proliferative diabetic retinopathy.
In April of 2006, the Social Security Administration (the "Administration") notified Petitioner that, because she earned $734.40 per month in 2000 -- $34.40 above the presumptive amount for Substantial Gainful Activity (SGA) -- her eligibility for disability benefits had ceased as of January 2000. Cessation of Petitioner's benefits was affirmed on reconsideration, and Petitioner requested a hearing before an Administrative Law Judge. In May of 2009, Administrative Law Judge ("ALJ") Jack Reed conducted the hearing. In addition to Petitioner, vocational expert Richard Sherman and medical expert Laura Rosch, D.O., testified. The ALJ issued an unfavorable decision on July 7, 2009, and Petitioner requested review of the ALJ's decision.
In September of 2011, the Appeals Council denied Petitioner's request for review of the ALJ's decision, making the ALJ's decision the Commissioner's final decision subject to judicial review. Petitioner appealed this final decision to the Court. The Court has jurisdiction to review the ALJ's decision pursuant to 42 U.S.C. § 405(g).
At the time of the hearing, Petitioner was 45 years of age. Petitioner is a high school graduate whose prior work experience includes working as a waitress, counter clerk, office worker, sales clerk and fitting room attendant.
Petitioner bears the burden of showing that disability benefits are proper because of the inability "to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment 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); see also 42 U.S.C. § 1382c(a)(3)(A); Rhinehart v. Fitch, 438 F.2d 920, 921 (9th Cir. 1971). An individual will be determined to be disabled only if her physical or mental impairments are of such severity that she not only cannot do her previous work but is unable, considering her age, education, and work experience, to engage in any other kind of substantial gainful work which exists in the national economy. 42 U.S.C. § 423(d)(2)(A).
On review, the Court is instructed to uphold the decision of the Commissioner if the decision is supported by substantial evidence and is not the product of legal error. 42 U.S.C. § 405(g); Universal Camera Corp. v. Nat'l Labor Relations Bd., 340 U.S. 474 (1951); Meanel v. Apfel, 172 F.3d 1111, 1113 (9th Cir. 1999) (as amended); DeLorme v. Sullivan, 924 F.2d 841, 846 (9th Cir. 1991). Substantial evidence is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. Richardson v. Perales, 402 U.S. 389, 401 (1971). It is more than a scintilla but less than a preponderance, Jamerson v Chater, 112 F.3d 1064, 1066 (9th Cir. 1997), and "does not mean a large or considerable amount of evidence." Pierce v. Underwood, 487 U.S. 552, 565 (1988).
The Court cannot disturb the Commissioner's findings if they are supported by substantial evidence, even though other evidence may exist that supports the petitioner's claims. 42 U.S.C. § 405(g); Flatten v. Sec'y of Health and Human Servs., 44 F.3d 1453, 1457 (9th Cir. 1995). Thus, findings of the Commissioner as to any fact, if supported by substantial evidence, will be conclusive. Flatten, 44 F.3d at 1457. It is well-settled that, if there is substantial evidence to support the decision of the Commissioner, the decision must be upheld even when the evidence can reasonably support either affirming or reversing the Commissioner's decision, because the Court "may not substitute [its] judgment for that of the Commissioner." Verduzco v. Apfel, 188 F.3d 1087, 1089 (9th Cir. 1999).
When reviewing a case under the substantial evidence standard, the Court may question an ALJ's credibility assessment of a witness's testimony; however, an ALJ's credibility assessment is entitled to great weight, and the ALJ may disregard self-serving statements. Rashad v. Sullivan, 903 F.2d 1229, 1231 (9th Cir. 1990). Where the ALJ makes a careful consideration of subjective complaints but provides adequate reasons for rejecting them, the ALJ's well-settled role as the judge of credibility will be upheld as based on substantial evidence. Matthews v. Shalala, 10 F.3d 678, 679-80 (9th Cir. 1993).
The Commissioner uses an eight-step sequential process in evaluating whether a claimant's disability continues. 20 C.F.R.404.1594(f)(1-8). At step one of the sequential evaluation for determining whether disability continues, the ALJ determines whether a claimant is engaging in Substantial Gainful Activity ("SGA"). If so, disability benefits are denied, regardless of medical condition, age, education, or work experience. 20 C.F.R. § 404.1520(b). Here, the ALJ found at step one that Petitioner was engaged in SGA beginning in January of 2000 because Petitioner's average monthly earnings throughout 2000 were $34.40 above the SGA cut-off amount of $700 per month. Consequently, the analysis ended at step one of the eight-step evaluation.
According to the federal regulations, "[s]ubstantial gainful activity is work activity that is both substantial and gainful." 20 C.F.R. § 404.1572. "Substantial work activity is work activity that involves doing significant physical or mental activities." Id. "Work activity is gainful if it is the kind of work usually done for pay or profit, whether or not a profit is realized." Id. In evaluating whether a claimant's work is both substantial and gainful, the Commissioner's "primary consideration will be the earnings [the claimant] derive[s] from the work activity," unless the Commissioner has information from the claimant, her employer, or others showing that not all of her earnings should be considered. 20 C.F.R. § 404.1574(a)(1); See also Social Security Ruling 83--33 ("[E]arnings provide an objective and feasible measurement of work.") (hereinafter SSR 83-33). *fn1
For the period between July of 1999 and December of 2000, the regulations stipulated that monthly earnings averaging more than $700 "ordinarily show that [a claimant] ha[s] engaged in substantial gainful activity," whereby "a rebuttable presumption arises that the [claimant] is no longer 'disabled' for the purpose of obtaining benefits." Malatesta v. Astrue, 2010 WL 3724033 (N.D.N.Y. Sept. 15, 2010) (alterations in original); See Thomas v. Astrue, 359 F. App'x 761, 762 (9th Cir. 2009); see also 20 C.F.R. § 404.1574(b)(2).
When a claimant earns more than the primary amount set forth in the earning guidelines contained in SSR 83-33, a rebuttable presumption arises that the claimant was engaged in SGA. The focus, however, is on the "actual value" of the work performed. In determining what portion of a claimant's earnings represent the "actual value of the work" performed, the Commissioner must first ascertain the claimant's gross or total earnings, including any payments made in kind in lieu of cash. See 20 C.F.R. § 404.1574(b)(1); see also SSR 83--33. The Commissioner then deducts any subsidized earnings paid by the employer and any impairment-related work expenses (IRWEs) paid by the employee. 20 C.F.R. § 404.1574(b)(1).*fn2 A subsidy, which is a term of art in this context, occurs when an ...