Larson v. Astrue

In the

United States Court of Appeals
For the Seventh Circuit

No. 09-4037

L YNN M ARIE L ARSON,
Plaintiff-Appellant,
v.

M ICHAEL J. A STRUE, Commissioner of Social Security,

Defendant-Appellee.

Appeal from the United States District Court
for the Western District of Wisconsin.
No. 09-cv-67-bbc—Barbara B. Crabb, Judge.

A RGUED JUNE 9, 2010—D ECIDED A UGUST 3, 2010

Before P OSNER, W OOD , and H AMILTON, Circuit Judges.
W OOD , Circuit Judge. Lynn Marie Larson contends
that she is disabled by anxiety, depression, and ankle
pain. She applied for Supplemental Security Income
(“SSI”), but an Administrative Law Judge (“ALJ”) con-
cluded that her impairments, although severe, are not
disabling. The district court upheld the agency’s deci-
sion, Larson v. Astrue, No. 09-cv-067-bbc, 2009 WL 3379144,
at *1 (W.D. Wis. Oct. 19, 2009), and Larson appeals. Among
2 No. 09-4037

other things, she argues that the ALJ erred by discrediting
her testimony and not giving controlling weight to the
opinion of her long-term treating psychiatrist. We agree
with her that the evidence supports an award of benefits.

I
Now 38, Larson was educated through three years of
college and has past work experience as a bartender.
She has been under the care of mental health specialists
since at least 1998, when she began seeing Dr. Bruce
Rhoades, a psychiatrist. He diagnosed Larson with
“major depression (recurrent) moderate.” His treatment
notes from 1999 through 2003 show that he prescribed and
regularly adjusted the dosages of several anti-depressants
and anxiety medications.
Matters went from bad to worse for Larson in Jan-
uary 2004, when she was raped by the grandfather of
one of her children and suffered a broken hand and
injured thumb. She dates the onset of her disability from
that incident. After the assault a social worker provided
therapy for depression and post-traumatic stress dis-
order (“PTSD”). The social worker scored Larson at
50 on the Global Assessment of Functioning (“GAF”),
which measures a person’s overall ability to function.
A MERICAN P SYCHIATRIC A SSOCIATION, D IAGNOSTIC AND
S TATISTICAL M ANUAL OF M ENTAL D ISORDERS, 30 (4th
ed. 1994). (A GAF of 50 indicates serious symptoms or
functional limitations. Id. at 32.) Larson also consulted
Dr. Rhoades, who observed that her mood was depressed
though she appeared “pleasant and settled.” He diagnosed
No. 09-4037 3

Larson with generalized anxiety disorder and possible
PTSD, renewed her prescriptions for anti-depressants,
and increased the dosage of her anti-anxiety medication.
A few months later Dr. Rhoades concluded that Larson
was doing much better and scored her at 70 on the GAF;
nevertheless, he confirmed his diagnosis of PTSD.
In April 2004, Larson tripped outside a bar after five
or six drinks and fractured her ankle in three places. The
same orthopedist who had treated her after the rape
surgically repaired the ankle fractures. A month later he
concluded that the ankle was healing well. Around the
same time, Larson confessed to Dr. Rhoades that she
had started drinking more heavily and questioned
whether her depression was the reason. Dr. Rhoades
responded by adjusting her medications; he decreased
the dosage of her anti-depressants but, gauging her
anxiety level as “fairly high,” he increased her anti-
anxiety medication. Her GAF was back down to 50.
Dr. Rhoades later reported that Larson’s anxiety was
“under reasonable control,” a view that prompted him
to change her medication again. In June 2004 she
applied for benefits. Her initial application was limited
to allegations relating to the pain from her broken
ankle; later she added allegations of disability stemming
from mental impairments.
A month later, Larson’s stepfather beat her and re-
injured her ankle. X-rays showed no evidence of a new
fracture, but Larson told her orthopedist that she was
4 No. 09-4037

having difficulty walking without an ankle brace. She
also saw Dr. Rhoades, who reconfirmed the diagnosis of
major depression and prescribed additional anti-depres-
sants and anti-anxiety medications.
Other issues in 2004 and 2005 led to further consulta-
tions with Dr. Rhoades and Jennifer Herink, a psycho-
therapist. In August 2004 Dr. Rhoades noted that Larson
was “not doing very well” and prescribed additional
medication to treat her depression and anxiety. She had
a “nervous breakdown” and missed almost two weeks of
work at the Head Start program where she had been
working part-time as a bus driver. A nephew she had
been raising was placed in foster care after a social
services agency investigated an allegation of child ne-
glect. And she was arrested for driving while under
the influence. She reported to Herink that she had
stopped taking her prescription medication and started
(or, it seems, continued) self-medicating with marijuana
and alcohol. Larson reported to Dr. Rhoades that she
was not getting out of bed, and so he prescribed two
additional anti-depressants. Throughout the last half of
2004 and 2005, Dr. Rhoades documented that Larson
was depressed, assessed her GAF at 50 to 60, and pre-
scribed additional medications to control her anxiety
and mood.
Larson’s application for SSI was denied initially in
August 2004 and upon reconsideration in August 2005.
A state-agency psychologist had reviewed the medical
record shortly before the second denial and had assessed
Larson’s mental impairments using a standard form
No. 09-4037 5

“Psychiatric Review Technique,” see 20 C.F.R. § 404.1520a.
He diagnosed Larson with an “affective disor-
der”—specifically depression—under Listing 12.04 and
an “anxiety-related disorder” under Listing 12.06, see 20
C.F.R. § Pt. 404, Subpt. P. App. 1. In his opinion neither
of the impairments was severe. He concluded that
Larson had not suffered an extended episode of decom-
pensation (a somewhat vague term whose meaning
we explore below) and was experiencing only “mild”
restrictions on daily living activities and “moderate”
difficulties in the realms of social functioning and con-
centration, persistence, or pace. He thought that Larson
could perform simple, repetitive, low-stress work even
though she would probably have trouble dealing with
large groups of people or stressful situations.
In December 2005, Dr. Rhoades completed a Mental
Impairment Questionnaire. He reported there that he
had been treating Larson since 1998 on roughly
a monthly basis. His diagnosis was severe, recurrent
depression and dissociate identity disorder. Her current
GAF score, he said, was 50. Observing that she
avoids most social situations, he noted that Larson was
experiencing repeated (i.e., three or more) episodes of
decompensation. He also checked a box indicating that
she had “slight” restrictions in activities of daily
living, “marked” difficulties in social functioning, and
“frequent” deficiencies of concentration, persistence,
or pace.
In January 2006, Larson reported to Herink that she
was having increased thoughts of suicide. Herink en-
6 No. 09-4037

couraged her to go to the hospital, but she did not follow
that advice. Herink later asked the police to check on
Larson. They did so and, according to Herink’s progress
notes, they took her to the hospital. The administra-
tive record contains no other information about this
hospitalization.
Larson briefly testified before the ALJ at her hearing
in March 2007. Twice during the questioning she said
that she wanted to “go home.” Much of her testimony
focused on her efforts to hold a job since her alleged
onset date. The month before the hearing, Larson had
quit a part-time job at a gas station, where she oc-
casionally had to hide in the bathroom, apparently to
avoid customers. Since 2004 she also had been working
about two hours per week at a restaurant, tending bar,
cooking, and waiting tables. Although she drove the
Head Start school bus for a short period, she was fired
from that job after suffering a breakdown that alerted
her employer to the drugs she was taking. Larson
insisted that she could not work full-time because
she suffers panic attacks and uncontrollable crying
spells that last as little as 15 minutes to as long as
several hours. She had succeeded in keeping the
restaurant job, she explained, only because the owner,
Paul Calliss, was a friend. Larson explained that she
was caring for her four children (then ranging in age
from 6 to 17), cooking for the family, and doing laundry
and other household chores. If she needed to shop, she
went with Calliss or else waited until late in the evening
to avoid encountering other people. Finally, she re-
ported that she was taking medications (she did not say
No. 09-4037 7

what or for which condition) that made her drowsy and
required her to nap during the day.
Calliss, Larson’s friend and employer, confirmed that
Larson worked for him “very part time,” sometimes all
day if there was a special event but on average less
than two hours per week. He explained that Larson
typically needed a break after a short time because she
was nervous around strangers.
The ALJ called Dr. Steven Carter, a psychologist, as
a medical expert to testify about Larson’s mental im-
pairments. Dr. Carter considered whether Larson met
the criteria for a per se disability under Listing 12.04
for depression. A claimant suffering from an affective
disorder meets the listed severity level for a depressive
syndrome if enough listed factors (the “A criteria”) are
present. 20 C.F.R. § Pt. 404, Subpart P. App. 1, § 12.04(A);
see Rabbers v. Comm’r Soc. Sec. Admin., 582 F.3d 647, 653
(6th Cir. 2009); Holohan v. Massanari, 246 F.3d 1195, 1203
(9th Cir. 2001). There is no dispute that Larson’s depres-
sion qualified as severe for purposes of the “A criteria.”
But the “A criteria” alone are not enough; in order to be
considered per se disabled, at least two of the following
“B criteria” must also be present: (1) “marked” restriction
of activities in daily living, (2) “marked” difficulties
in maintaining social functioning, (3) deficiencies of
concentration, persistence or pace, or (4) “repeated epi-
sodes of decompensation each of extended duration.”
20 C.F.R. § Pt. 404, Subpart P. App. 1, § 12.04(B); see Craft
v. Astrue, 539 F.3d 668, 674-75 (7th Cir. 2008); Randolph
v. Barnhart, 386 F.3d 835, 840 (8th Cir. 2004).
8 No. 09-4037

Dr. Carter testified that Larson met the “A criteria”
but had not satisfied the “B criteria.” He thought (errone-
ously, as we have pointed out) that Larson had not
been hospitalized or been in a group home, and on that
basis he concluded that she had never experienced an
extended episode of decompensation. He was willing
to concede that she had “marked” restrictions in
social activities, but he saw only “mild” restrictions
on daily activities and no significant limitations with
respect to concentration, persistence, or pace. He opined
that Larson should work in a low-stress, alcohol-free
environment that did not involve large crowds.
Dr. Carter did not try to reconcile his assumption that
Larson had not been hospitalized with Herink’s
progress note reporting that Larson had been taken to
the hospital by the police. Nor did he confront
Dr. Rhoades’s contradictory finding that Larson had
suffered “repeated” episodes of decompensation. He
also said nothing about the relevance to Listing 12.04 of
the frequent adjustments to her medications. And
although Dr. Carter had been present for Larson’s testi-
mony, he did not comment on her assertion that she
had suffered a nervous breakdown while working as a
bus driver or the fact that she had been fired from
that position shortly thereafter.
After the hearing, the ALJ denied Larson’s claim. At
Step 1 of the five-step analysis prescribed in 20 C.F.R.
§ 404.1520, the ALJ found that Larson had not engaged
in gainful employment since her 2004 onset date. At
Step 2 the ALJ concluded that Larson suffered from
severe impairments, namely, left ankle pain, a left wrist
fracture, right hand osteoarthritis, affective disorder, and
No. 09-4037 9

anxiety disorder. At Step 3, however, the ALJ concluded
that none of the impairments was medically equivalent
to anything on the lists. After explaining that he was
adopting the opinion of Dr. Carter, the ALJ asserted
that “there is no evidence in the record that the claimant
has ever suffered an episode of decompensation of ex-
tended duration due to her psychological symptoms.”
The ALJ acknowledged that Larson was experiencing
restrictions in social functioning, but he reasoned that
those restrictions were only “moderate” because she
attended doctor’s appointments on a regular basis, was
able to go to the grocery store alone if she went at
night, and had good relationships with two friends. The
ALJ pegged her difficulties maintaining concentration,
persistence, and pace at the “moderate” level.
At Step 4 the ALJ stated that he had given “some
weight” to Dr. Rhoades’s opinion that Larson met the
criteria in the listing, but he found that Rhoades’s assess-
ment of the severity of Larson’s symptoms was not suffi-
ciently corroborated. Larson’s testimony about the
severity of her impairments, the ALJ thought, was incon-
sistent with her account of her daily activities. The
ALJ concluded that her “psychological symptoms wax
and wane based on situational stressors.” At Step 5, the
ALJ concluded based on the testimony of a vocational
expert that Larson could work as a hand packager or
electronics worker.

II
On appeal, Larson first argues that the ALJ should
have granted controlling weight to the opinion of
10 No. 09-4037

Dr. Rhoades, who easily qualified as her treating psychia-
trist, and found her disabled at Step 3. Larson maintains
that the assessment given by Rhoades is consistent—or
at least not inconsistent—with the evidence in the rec-
ord. A treating physician’s opinion is entitled to “con-
trolling weight” if it is “well-supported by medically
acceptable clinical and laboratory diagnostic techniques
and is not inconsistent with other substantial evidence.”
20 C.F.R. § 404.1527(d)(2); see Schaaf v. Astrue, 602 F.3d
869, 875 (7th Cir. 2010); Denton v. Astrue, 596 F.3d 419,
424 (7th Cir. 2010). An ALJ who does not give con-
trolling weight to the opinion of the claimant’s treating
physician must offer “good reasons” for declining to
do so. 20 C.F.R. § 404.1527(d)(2); see Schaaf, 602 F.3d at
875; Schmidt v. Astrue, 496 F.3d 833, 842 (7th Cir. 2007).
If the ALJ had given Dr. Rhoades’s opinion controlling
weight, Larson’s condition would have been recognized
as a listed impairment and she would have been found
disabled at Step 3. See 20 C.F.R. § 404.1520a(d)(1); Craft,
539 F.3d at 675. All medical experts agreed that Larson
met the “A criteria” for depression, and Dr. Rhoades
opined that she satisfied the “B criteria” as well. With
regard to the latter, Dr. Rhoades saw “marked” difficulties
in Larson’s ability to function socially. The ALJ offered
several reasons for rejecting Rhoades’s view. First, he
found Dr. Carter’s opinion more persuasive. In addition,
he was impressed by the evidence showing that Larson
attended doctors’ appointments, went grocery shopping
at night, and had good relationships with two friends. All
of this indicated to him that her difficulties were just
“moderate.” But the ALJ mischaracterized Dr. Carter’s
No. 09-4037 11

opinion; Dr. Carter, like Dr. Rhoades, had concluded
that Larson experienced “marked,” not “moderate,”
limitations in this area. Whether by mistake or design, the
ALJ disregarded this medical evidence and improperly
substituted his own opinion. See Murphy v. Astrue, 496
F.3d 630, 634 (7th Cir. 2007) (“[A]n ALJ cannot disregard
medical evidence simply because it is at odds with the
ALJ’s own unqualified opinion.”); Clifford v. Apfel, 227
F.3d 863, 870 (7th Cir. 2000). The Commissioner tries to
salvage the ALJ’s conclusion by pointing to one instance
in 2004 when Dr. Rhoades described Larson’s demeanor
as “pleasant and settled” and by recalling that the state-
agency psychologist thought that Larson had only “mod-
erate” limitations in social functioning. But these are not
reasons that appear in the ALJ’s opinion, and thus they
cannot be used here. See SEC v. Chenery Corp., 318 U.S.
80, 87-88 (1943); Parker v. Astrue, 597 F.3d 920, 922 (7th
Cir. 2010); Stewart v. Astrue, 561 F.3d 679, 684 (7th Cir.
2009).
Dr. Rhoades also stated that Larson had experienced
repeated (by which he meant at least three) episodes of
decompensation. The ALJ disagreed, insisting that there
was “no evidence in the record that the claimant has
ever suffered an episode of decompensation of extended
duration due to her psychological symptoms.” The ALJ’s
conclusion followed Dr. Carter’s. But, as we noted
earlier, both the ALJ and Dr. Carter overlooked the evi-
dence from Herink of Larson’s suicidal thinking and trip
to the hospital in 2006.
Although everyone seemed to think that he or she
knew what is meant by “episodes of decompensation,” this
12 No. 09-4037

is not a self-defining phrase. Dr. Carter took an ap-
proach that was too narrow in light of the definitions
that the Social Security Administration uses. The listing
defines “episodes of decompensation” as “exacerbations
or temporary increases in symptoms or signs accom-
panied by a loss of adaptive functioning, as manifested
by difficulties in performing activities of daily living,
maintaining social relationships, or maintaining con-
centration, persistence, or pace.” 20 C.F.R. § Pt. 404,
Subpart P. App. 1, § 12.00; see also S TEDMAN’S M EDICAL
D ICTIONARY, 497 (28th ed. 2006) (defining decompensa-
tion as the “appearance or exacerbation of a mental
disorder due to failure of defense mechanisms”); Zabala
v. Astrue, 595 F.3d 402, 405 (2d Cir. 2010) (stating that
decompensation is a temporary increase in symptoms);
Kohler v. Astrue, 546 F.3d 260, 266 n.5 (2d Cir. 2008) (same).
An incident—such as hospitalization or placement in
a halfway house—that signals the need for a more struc-
tured psychological support system would qualify as an
episode of decompensation, 20 C.F.R. § Pt. 404, Subpart P.
App. 1, § 12.00, but so would many other scenarios. The
listing recognizes that an episode may be inferred from
medical records showing a significant alteration in med-
ication, see 20 C.F.R. § Pt. 404, Subpart P. App. 1, § 12.00.
Larson has a long history of problems that have led to
significant alterations in her medications. See Rabbers, 582
F.3d at 660 (observing that treating physician’s testi-
mony that side effects of medication affects claimant’s
ability to function is consistent with a finding of repeated
episodes of decompensation); Natale v. Comm’r of Soc. Sec.,
651 F. Supp. 2d 434, 451-53 (W.D. Pa. 2009) (stating that
No. 09-4037 13

it was error for ALJ to reject treating physician’s con-
clusion that claimant suffered repeated episodes of
decompensation where claimant had history of adjust-
ments to medication and fluctuating mood); 3 S OCIAL
S ECURITY L AW & P RACTICE § 42:124 (2010) (“Episodes
of decompensation may be demonstrated by an exacer-
bation in symptoms or signs that would ordinarily
require increased treatment or a less stressful situation
(or a combination of the two).”). Dr. Carter, despite being
present for Larson’s testimony, never mentioned the
nervous breakdown that caused her to miss almost two
weeks of work; that incident qualified as an episode
of decompensation, see Lankford v. Sullivan, 942 F.2d 301,
307-08 (6th Cir. 1991).
In addition, although the listing defines “repeated
episodes of decompensation” as three episodes within
one year or an average of one every four months (each
lasting for at least two weeks), the listing also states
that for claimants who experience more frequent episodes
of shorter duration, the ALJ should determine if the
duration and the functional effects are of equal severity.
20 C.F.R. § Pt. 404, Subpart P. App. 1, § 12.00. A fair
reading of the record indicates that Dr. Rhoades reached
exactly the latter conclusion about Larson.
In response, the Commissioner makes much of the
fact that Dr. Rhoades did not explain on the question-
naire his conclusion that Larson had experienced
repeated episodes of decompensation. But in every section
on the questionnaire that allowed for comments, Dr.
Rhoades made them; the question dealing with Larson’s
functional limitations and episodes of decompensation
14 No. 09-4037

did not invite further explanation or include space for
comments. Although by itself a check-box form might
be weak evidence, the form takes on greater significance
when it is supported by medical records. Mason v. Shalala,
994 F.2d 1058, 1065 (3d Cir. 1993); see also Johnson v.
Apfel, 189 F.3d 561, 564 (7th Cir. 1999) (upholding ALJ’s
rejection of physician’s check-box form where it was
contradicted by evidence in the record). Here, there is a
long record of treatment by Dr. Rhoades that supports
his notations on the form.
In arguing that “the ALJ also premised his weighing of
Dr. Rhoades’s assessment on the fact that his treatment
notes reflected ‘waxing and waning symptoms’ depending
on particular situational stressors,” the Commissioner
distorts the ALJ’s reasoning. The ALJ simply stated
that “the claimant’s psychological symptoms wax and
wane based on situational stressors” without tying this
observation to Dr. Rhoades’s treatment notes. More
importantly, symptoms that “wax and wane” are not
inconsistent with a diagnosis of recurrent, major depres-
sion. “A person who has a chronic disease, whether
physical or psychiatric, and is under continuous treat-
ment for it with heavy drugs, is likely to have better
days and worse days.” Bauer v. Astrue, 532 F.3d 606, 609
(7th Cir. 2008). No doctor concluded that Larson’s symp-
toms were just a response to situational stressors as
opposed to evidence of depression. The ALJ’s conclusion
to the contrary thus finds no support in the record.
See Hopgood ex rel. L.G. v. Astrue, 578 F.3d 696, 702 (7th
Cir. 2009).
No. 09-4037 15

Even if the ALJ had articulated good reasons for
rejecting Dr. Rhoades’s opinion, it still would have been
necessary to determine what weight his opinion was
due under the applicable regulations. See 20 C.F.R.
§ 404.1527(d)(2). An ALJ must consider the length, nature,
and extent of the treatment relationship; frequency
of examination; the physician’s specialty; the types of
tests performed; and the consistency and support for
the physician’s opinion. Moss v. Astrue, 555 F.3d 556, 561
(7th Cir. 2009); Elder v. Astrue, 529 F.3d 408, 415 (7th
Cir. 2008); Hofslien v. Barnhart, 439 F.3d 375, 377 (7th Cir.
2006). These factors support Dr. Rhoades: he had
treated Larson for several years on a monthly basis; he is
a psychiatrist, not a psychologist; and his opinion is
consistent with the evidence in the record. Apart from
the ALJ’s unhelpful statement that Dr. Rhoades’s opin-
ion was entitled to “some weight,” the ALJ said nothing
regarding this required checklist of factors. See 20 C.F.R.
§ 404.1527(d)(2); Moss, 555 F.3d at 561; Bauer, 532 F.3d
at 608-09.
Thus, the ALJ erred by failing to give controlling
weight to Dr. Rhoades’s opinion about the limitations on
Larson’s social functioning and her experience with
episodes of decompensation. Once we give his opinion
the proper weight, the record shows that Larson’s condi-
tion meets the standards of the Listing, and thus that
the ALJ should have found her disabled at Step 3.
16 No. 09-4037

III
Our conclusion is reinforced by the problems we see
in the approach the ALJ took in his assessment of
Larson’s credibility. Normally, we give an ALJ’s credibility
determinations special deference because the ALJ is
in the best position to see and hear the witness. See
Eichstadt v. Astrue, 534 F.3d 663, 667-68 (7th Cir. 2008).
But it is nevertheless possible to upset a credibility
finding if, after examining the ALJ’s reasons for discred-
iting testimony, we conclude that the finding is
patently wrong. See Schaaf, 602 F.3d at 875; Prochaska v.
Barnhart, 454 F.3d 731, 738 (7th Cir. 2006); Sims v.
Barnhart, 442 F.3d 536, 538 (7th Cir. 2006).
Here, the ALJ rejected Larson’s testimony about the
severity of her symptoms. The ALJ suggested that Larson
must have overstated the effects of her impairments
because she had developed relationships with two
friends whom she visited often, she had “held down” a
series of part-time jobs, and she had accommodated
her fear of the public by going to the grocery store at
night. But Larson’s ability to maintain a small number
of close friendships does not undermine her testimony
that she is afraid of going out in public. And the ALJ’s
assertion that Larson has succeeded in holding down
a series of part-time jobs stretches the evidence beyond
the breaking point. There is a significant difference be-
tween being able to work a few hours a week and having
the capacity to work full time. See SSR 96-8p, 1996 WL
374184, at *1; Diaz v. Prudential Ins. Co. of Am., 499 F.3d 640,
648 (7th Cir. 2007); Carradine v. Barnhart, 360 F.3d 751, 755
No. 09-4037 17

(7th Cir. 2004). Larson was able to work for Calliss part-
time only because he was a friend who tolerated frequent
breaks and absences that an ordinary employer would
have found unacceptable. This does not contradict her
claim of disability. See Henderson v. Barnhart, 349 F.3d
434, 435 (7th Cir. 2003). In fact, it is not accurate to say
that Larson “held down” (meaning kept) these part-
time jobs. She testified without contradiction that she
was fired from her job at Head Start because of her
nervous breakdown and the medications she was taking,
and she quit her job at the gas station because of the
stress in dealing with unfamiliar customers. Last, the
ALJ’s conclusion that Larson accommodated her fear of
going out in public does not discredit her testimony
that she has a fear of going out in public and gives in to
that fear regularly. Nothing in the record supported the
ALJ’s inference that there were ways in which Larson’s
condition could be treated or managed. See Myles v.
Astrue, 582 F.3d 672, 677-78 (7th Cir. 2009). The ALJ’s
reasons for his adverse credibility ruling find no
support, on close examination, and for that reason, the
credibility determination cannot stand.

IV
For these reasons, we find that Larson is entitled to
an award of benefits. The ALJ’s decision is R EVERSED
and the case is R EMANDED for entry of an order con-
sistent with this opinion.

8-3-10