The opinion of the court was delivered by: GREEN
Plaintiff, the Association of Administrative Law Judges, is a not-for-profit corporation whose members are administrative law judges (ALJs) employed by the Department of Health and Human Services (HHS) and assigned to the Office of Hearings and Appeals (OHA) of the Social Security Administration (SSA). Plaintiff's members adjudicate claims for disability benefits under Titles II and XVI of the Social Security Act, 42 U.S.C. §§ 401 et seq. (1982) and 42 U.S.C. §§ 1381 et seq. (1982). Plaintiff brought this lawsuit to challenge the "Bellmon Review Program", which defendants instituted to implement Section 304(g) of the Social Security Disability Amendments of 1980, the "Bellmon Amendment".
Plaintiff alleges that this program violates the rights of its members to decisional independence under the Administrative Procedure Act (APA), 5 U.S.C. § 551 et seq. (1982).
State agencies administer the Social Security Disability Insurance Program pursuant to agreements with the SSA. Based upon medical information received from various sources and applying SSA guidelines, the state disability determination service issues the decision of SSA. A claimant who is denied benefits may file for reconsideration at the state level and if dissatisfied may then seek relief on the federal level. The ALJ hearing is a de novo proceeding. The ALJ is the first agency personnel in the review process to interview the claimant in person. The claimant may submit additional evidence, produce expert witnesses, and be represented by counsel. If his or her claim is denied by the ALJ, the claimant may appeal to the Appeals Council, which is the last step in the administrative process.
The Appeals Council has the authority to review all decisions of ALJs, at its own discretion ("own motion"), or at the request of a claimant. In either case, the Appeals Council is authorized to exercise jurisdiction only when: (1) there appears to be an abuse of discretion by the ALJ; (2) there is an error of law; (3) the action, findings or conclusions of the ALJ are not supported by substantial evidence; or (4) there is a broad policy or procedural issue that may affect the general public interest. 20 C.F.R. § 404.970(a), 416.1470(a) (1984). Based upon its review, the Appeals Council may modify, affirm, reverse or remands an ALJ's decision. When the Appeals Council reverses or remands an ALJ's decision, it issues an opinion stating the grounds for reversal or remand and identifying dispositive abuses of discretion, errors of law, problems with conclusions of law and findings of fact, insufficiencies of evidence, and policy or procedural issues of concern to SSA. If a case is remanded, the ALJ must take any action ordered by the Appeals Council, but may also take any additional action that is not inconsistent with the remand order.
The Bellmon Amendment directed the Secretary of HHS to resume review of decisions of ALJs on her own motion. Congress expressed concern at that time about the high rate at which ALJs were reversing determinations made at the state level and the variance in these rates among ALJs. See H.R. Rep. No. 944, 96th Cong., 2d Sess. 57 (1980), reprinted in  U.S. Code Cong. & Ad. News 1392, 1405; S. Rep. No. 408, 96th Cong., 2d Sess. 53 (1980), reprinted in  U.S. Code Cong. & Ad. News 1277, 1331.
A study performed pursuant to the Bellmon Amendment and described in a report to Congress in January 1982 (PX-1), indicated that the Appeals Council more often would have changed decisions by ALJs allowing benefits made by ALJs with above average allowance rates than allowance decisions made by ALJs with average or below-average allowance rates. n2 The Bellmon Review Program, a series of measures designed to improve decisional quality and accuracy, began in October, 1981. Associate Commissioner of SSA, Louis B. Hays, announced that four categories of cases would be selected for possible "own motion" review:
(1) National random sample 21%
(2) Allowance decisions of new ALJs
(3) Decisions referred by SSA's Office 16%
of Disability Operations
(4) Individual ALJs 63%
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