Appellant's appeal of Social Security disability benefits denial reversed; court found substantial evidence of mental illness disability despite administrative law judge's decision.
Outcome: Reversed for appellant.
What happened
The facts of the case, in plain language.
From September 1980 onward, Parsons was diagnosed with serious mental impairments including impaired judgment, poor social skills, and impaired reality testing in situations involving affect, with a 1982 diagnosis of chronic undifferentiated schizophrenia.
Parsons worked as a pharmacist for six months after graduating in 1977, was fired in 1978, and subsequently earned only $281.54 total during 1980-1981 and no income in 1979, despite consistently expressing a desire for employment.
The administrative law judge found Parsons incapable of returning to his past work as a pharmacist but terminated his analysis with a finding of no severe impairment, failing to shift the burden of proof to the Secretary to demonstrate alternative work capacity.
Parsons reported work earnings of approximately $2,000 for 1981 in his disability application but his actual earnings for that year were $30.17, demonstrating a significant gap between his stated and actual functional capacity.
What the court decided
James C. Parsons applied for Social Security disability benefits for mental illness beginning in 1979. An administrative law judge denied the claim, finding Parsons not disabled as of his last day of insured status (June 30, 1981). The district court affirmed. The Eighth Circuit reversed, finding the Secretary's conclusion unsupported by substantial evidence. The court noted that psychological evaluations from 1980, 1981, and 1982 consistently diagnosed serious mental problems including schizophrenia, personality disorders, and impaired judgment and social skills. The court emphasized Parsons' documented inability to maintain employment despite his expressed desire to work—he was fired from his pharmacist position in 1978 and earned minimal income thereafter. The court held that the ALJ erred by focusing on somatic pain while discounting significant mental impairments and failing to shift the burden to the Secretary to present vocational expert testimony.
- Once a claimant establishes an inability to return to past relevant work, the burden of going forward with evidence shifts to the Secretary to demonstrate, through vocational expert testimony, jobs in the national economy the claimant is capable of performing; the Secretary may not satisfy this burden through the medical-vocational guidelines when the claimant suffers from a nonexertional impairment. (*1340)
- Post-insured-status medical evaluations are admissible and must be considered in a Social Security disability adjudication when they bear strong correlations with pre-expiration evaluations and illuminate the claimant's condition as of the date insured status expired. (*1339)
- The Secretary's determination of a claimant's ability to perform jobs in the national economy must account for the claimant's actual functional ability in the real world, including evidence that the claimant's true capacity may be substantially less than the claimant asserts. (*1341)
- When the administrative record substantially supports a finding of disability and further hearings would merely delay receipt of benefits, a reviewing court may reverse and remand with directions to enter judgment awarding benefits rather than remand for additional administrative proceedings. (*1341)
How the court reached its decision
The court's reasoning, step by step.
Whether the ALJ's finding that Parsons was not disabled as of June 30, 1981 was supported by substantial evidence. Psychological evaluations from September 1980, December 1981, and May 1982 consistently documented serious mental impairments including impaired judgment, poor social skills, depression, and schizophrenia. The ALJ acknowledged 'significant mental impairments' yet focused almost solely on Parsons' somatic urinary tract pain disorder while discounting or ignoring the mental impairment evidence. Parsons' documented inability to maintain employment despite his consistent expressed desire to work—earning only $281.54 over 1980–1981 and nothing in 1979—further corroborated the severity of his disability. The Secretary's conclusion was unsupported by substantial evidence; the weight of the psychiatric record and Parsons' work history compelled a finding that he was disabled within the meaning of the Social Security Act.
Whether the ALJ committed legal error by failing to shift the burden to the Secretary after finding Parsons unable to return to past work as a pharmacist. The ALJ expressly found Parsons incapable of returning to his past work as a pharmacist, which triggered the obligation to shift the evidentiary burden. Instead, the ALJ terminated his analysis with a finding of no severe impairment and obtained no vocational expert testimony. Because Parsons' mental impairments were nonexertional, the medical-vocational guidelines were also unavailable. The ALJ erred as a matter of law by not shifting the burden to the Secretary and not obtaining vocational expert testimony after finding the claimant unable to perform past relevant work.
Whether post-insured-status medical evaluations may be considered to establish the claimant's condition as of the date insured status expired. The evaluations from September 1980 (within the insured period), December 1981 (six months post-expiration), and May 1982 (eleven months post-expiration) all described the same individual with serious mental problems—including impaired judgment, poor social skills, and paranoid or undifferentiated schizophrenia—demonstrating strong correlations across the entire period. All three evaluations were properly considered to establish Parsons' mental condition as of June 30, 1981.
Whether the appropriate remedy upon reversal is a direct award of benefits or remand for further administrative proceedings. Parsons was consistently diagnosed with severe social and adjustment problems since at least September 19, 1980; vocational expert testimony regarding jobs available between September 1980 and July 1981 would not erase the clinically observed and functionally corroborated fact that Parsons was mentally incapable of holding any job during that period. Remand with directions to award disability benefits as of March 5, 1981 was appropriate because additional administrative hearings would serve only to delay Parsons' receipt of benefits.
Key quotes from the opinion
Notable passages from the opinion, in the court's own words.
Cases the court relied on
Earlier decisions the court cited as authority for its ruling.
Cases that cite this one
132 later published cases cite this decision. The 25 that cite it most often are listed here.
- Naumann v. Saul (District Court, E.D. Missouri 2022)
- Lillard v. Berryhill (District Court, E.D. Missouri 2019)
- Shirley Hutsell v. Larry G. Massanari, 1 (8th Cir. 2001)
- Orr v. Chater (District Court, N.D. Iowa 1997)
- William P. BUTLER, Appellant, v. SECRETARY OF HEALTH AND HUMAN SERVICES, Appellee (8th Cir. 1988)
- Gavin v. Heckler (8th Cir. 1987)
- Gavin v. Heckler (8th Cir. 1987)
- Eddie SINGLETARY, Plaintiff-Appellant, v. Otis R. BOWEN, M.D., Secretary of Health and Human Services, Defendant-Appellee (5th Cir. 1986)
- Pate-Fires v. Astrue (8th Cir. 2009)
- Francis ELLISON, Appellant, v. Louis W. SULLIVAN, Secretary of Health and Human Services, Appellee (8th Cir. 1990)
- Felix JELINEK, Appellant, v. Margaret M. HECKLER, Secretary of Health and Human Services, Appellee (8th Cir. 1985)
- Fillou v. Heckler (District Court, N.D. Illinois 1985)
- Brooks v. Berryhill (District Court, S.D. Iowa 2018)
- Bernard v. Astrue (D. Minn. 2013)
- Morrison v. Astrue (District Court, N.D. Iowa 2012)
- Rivera v. Massanari (District Court, S.D. Iowa 2001)
- Gregory Andler v. Shirley S. Chater, Commissioner of Social Security Administration (8th Cir. 1996)
- Gregory Andler v. Shirley S. Chater (8th Cir. 1996)
- James FOWLER, Appellant, v. Otis R. BOWEN, Secretary of Health and Human Services of the United States, Appellee (8th Cir. 1989)
- Vicki WHEELER, Appellant, v. Louis W. SULLIVAN, M.D., Secretary, Department of Health and Human Services, Appellee (8th Cir. 1989)
- Finley Hudson v. United States Department of Labor (8th Cir. 1988)
- Donald Blevins v. Secretary of Health and Human Services (6th Cir. 1987)
- Robert L. GILLILAND, Appellant, v. Margaret HECKLER, Secretary of Health and Human Services (3d Cir. 1986)
- Osborn v. Bowen (8th Cir. 1986)
- Osborn v. Bowen (8th Cir. 1986)
This list shows which later cases cite this one. It does not say how they treated it, and no review of that has been done. Not a substitute for Shepard’s or KeyCite — verify before relying.
Full opinion
The complete text of the court's opinion as published.
Opinion of the Court
James C. Parsons appeals from the Secretary’s denial of his application for Social Security disability benefits under 42 U.S.C. §§ 423, 416(i). The District Court affirmed the Secretary’s denial of benefits. As we find the Secretary’s conclusion unsupported by substantial evidence, we reverse.
I. Facts
Parsons filed for disability benefits on March 5,1982. His claimed disability was for mental illness beginning in May 1979 and continuing to the present.
The first medical record indicating Parsons’ mental problems is a letter written by Dr. Roger P. Millea on March 16, 1979 referring Parsons to a psychiatrist. Designated Record (D.R.) at 76. In that letter Dr. Millea stated that Parsons “was probably suffering from paranoid schizophrenia” and that Parsons had been attending counseling sessions at Lutheran Social Services in Rapid City.
On August 26, 1980, Parsons was admitted to the Human Services Center (Center), which is a mental hospital in Yankton, South Dakota. A history and physical examination of Parsons was taken on September 15, 1980. This history notes that Parsons had an obsession that he was afflicted with a painful urinary tract infection. The history indicates Parsons had been seeing Dr. Donald W. Burnap, a psychiatrist, for about one year preceding his admission to the Center.
A psychologist at the Center examined Parsons on September 19, 1980 and prepared an evaluation of Parsons’ mental condition. This evaluation records Parsons’ obsession that he suffered from venereal disease, which he believed to be the source of his urinary tract pain. This obsession had lasted for at least six years, during which he had seen numerous doctors who refuted his self-diagnosis. Parsons’ mother reported her observation of “irrational behaviors, argumentative behaviors and depression” in Parsons. Id. at 91. While tests indicated that Parsons’ intelligence was within the average range, the subtests on the intelligence tests used showed considerable variation in scores. The evaluation attributes this variation to anxiety, depression, and diminished judgment. The evaluation concluded that Parsons demonstrated “both poor judgment and intellectualization and this appears related to his doubt about what to do in social situations.” Id. at 92. The evaluation also noted:
His reality testing is good except in situations where affect is present. Then the patient no longer exercises good judgment and he is not able to control his emotional experience. He has an intense self-focus which interferes with interpersonal situations. It is likely that in social situations this patient really isn’t aware of his impact on other people because he’s concentrating on his own train of thought or fantasy. This may in part explain why he seems disjointed in conversations. He may be disregarding what another is saying to him, at least in part, and racing on with his own interpretation.
Because of the amount of painful affect, anxiety, and frustration this patient has suicide potential. He is currently engaged in a rigid defensive effort with almost complete paralysis of affect.
Id. (emphasis added).
A social history and assessment taken on September 22,1980 noted that Parsons was in contact with the West River Mental Health Center in Rapid City in 1978 and 1979. This assessment also states that Parsons had been fired from the three jobs that he had held — as a computer operator, as a lumber yard worker, and as a pharmacist. Id. at 89-90.
Parsons was discharged from the Center on September 30, 1980. The discharge summary noted that although Parsons was intelligent, he was defensive about his psychiatric problems and became anxious and denied such problems whenever confronted with them. The final diagnosis on discharge included: (1) psychogenic pain disorder,
On December 14, 1981, about six months after the date his insured status ended,
.Parsons entered an adult day treatment program at the West River Mental Health Center on January 19, 1982. Parsons applied for disability insurance benefits on March 5, 1982. On May 5, 1982 Parsons was examined by Dr. Burnap at the request of the Social Security Administration. Dr. Burnap found Parsons to be suffering from chronic undifferentiated schizophrenia and mixed schizoid and obsessive-compulsive personality disorders. Dr. Burnap recommended that Parsons be given disability benefits. D.R. at 108-09.
II. Discussion
If the Secretary’s decision is supported by substantial evidence, it is affirmed. See, e.g., Brand v. Secretary of Health, Education and Welfare, 623 F.2d 523, 527 (8th Cir. 1980). Substantial evidence is defined as “relevant evidence that a reasonable mind might accept as adequate. to support a conclusion.” Smith v. Schweiker, 728 F.2d 1158, 1162 (8th Cir. 1984). The substantial evidence test is more than a mere search of the record for evidence supporting the Secretary’s finding. “The substantiality of evidence must take into account whatever in the record fairly detracts from its weight.” Universal Camera Corp. v. NLRB, 340 U.S. 474, 488, 71 S.Ct. 456, 464, 95 L.Ed. 456 (1951). The claimant has the burden of proving that he or she is disabled within the meaning of the statute. Once the claimant has established an inability to return to his past relevant work, the burden of going forward with evidence shifts to the Secretary to show other jobs in the economy that the claimant is capable of performing. Where an exertional impairment is demonstrated, the Secretary may fulfill this burden-by reference to the medical-vocational guidelines contained in the Secretary’s regulations. 20 C.F.R. Section 404, Subpart P, Appendix 2; McCoy v. Schweiker, 683 F.2d 1138, 1141 (8th Cir. 1982). The Secretary may not rely on these guidelines if the record indicates that the claimant suffers from a nonexertional impairment. 683 F.2d at 1148. In such cases, and in cases of exertional impairments which do not fit within the guidelines, the Secretary must use vocational expert testimony or other similar evidence in order to meet her burden of showing there are jobs in the national economy which the claimant is capable of performing. Id.
It is apparent from the record that the ALJ found Parsons to be incapable of returning to his past relevant work as a pharmacist. D.R. at 11. After making this finding, the AU should have shifted the burden of going forward with evidence
The Secretary argues that the court may not consider any medical, psychological, or psychiatric evaluations made after the expiration of the claimant’s insured status. We do not agree. While the Secretary is correct insofar as she contends that such evaluations must relate to the claimant’s condition prior to the expiration of his insured status, the mere fact that the examination was made following the expiration of insured status does not automatically make the examination irrelevant. In this case, there are strong correlations between the three most extensive psychological evaluations of Parsons, those of September 19, 1980, December 14, 1981 and May 3, 1982. While the conclusions of these evaluations are not identical, they all describe an individual with serious mental problems. All these evaluations must be considered in order to get a clear understanding of Parsons’ mental condition as of June 30, 1981. See Mann v. Richardson, 323 F.Supp. 175, 177-78 (S.D.N.Y. 1971) (total medical history may be considered to determine if condition existed prior to expiration of insured status); DeNafo v. Gardner, 272 F.Supp. 44, 46 (D.N.J. 1967) (subsequent condition or event when taken together with evaluation of condition existing prior to expiration of insured status may be corroborative or indicative of true condition prior to expiration of insured status).
Parsons’ job history provides strong evidence of the gap between his actual level of functional ability and his consistent presentation of himself as possessing strong potential. He was fired from his last full-time job as a pharmacist in 1978. After that he held only part-time employment as a laborer, earning less than $300 for 1980 and 1981, with no income in 1979. His pattern of defensive overstatement is also evident in his application forms for disability benefits. He consistently manifests a desire to find employment, yet the record attests to his inability to adjust to a work setting. While in his application form of March 5, 1982, he indicates that his earnings for 1981 were approximately $2,000, D.R. at 38, his actual earnings for that year were $30.17. Id. at 71. In that application he reported that his employment for 1980 and 1981 was as a laborer or as a janitor, yet in his December 14, 1981 admission interview to the West River Mental Health Center he reported that he had worked as a “manager” for the last fifteen months.
The reports on his mental condition from September 19, 1980 onward show that Parsons’ judgment, social skills and insight into his mental problems were impaired. His performance and manner during the May 3, 1982 examination by Dr. Burnap were not significantly different from his performance and manner during his two periods in residence at the Human Services Center. The psychiatric evaluations, together with Parsons’ ineffective attempts to obtain and hold employment, lead us to the conclusion that Parsons was disabled within the meaning of the Social Security Act and within the meaning of the Secretary’s regulations. Indeed, the ALJ conceded that Parsons had “significant mental impairments,” prior to the expiration of Parsons’ insured status. Id. at 11. The ALJ erred in focusing almost solely on Parsons’ somatic urinary tract pain disorder, while discounting or ignoring his problems of defensive overstatement, depression, impaired judgment, poor social skills, and inability to hold a job.
The Secretary’s determination regarding the ability of á claimant to perform jobs in the national economy must take into account the actual ability of the claimant to find and hold a job in the real world. As one court has stated, in selecting employees “[ejmployers are concerned with substantial capacity, psychological stability, and steady attendance; they will not unduly risk increasing their health and liability insurance costs” by hiring a person with serious physical or mental problems. Thomas v. Celebreeze, 331 F.2d 541, 546 (4th Cir. 1964) (cited with approval in
Tennant has held forty-six jobs in his twelve years of employment. His longest tenure at any job was six months. It appears that he has been fired from most of these jobs.
Tennant has consistently demonstrated a desire to be gainfully employed but has met with little success. He has been through a number of job training programs, but has never progressed in them to the satisfaction of his supervisors. His experience in the “real world” has been no better.
While Parsons suffers from a different personality disorder from that of Tennant, his pattern of defensive overstatement is quite similar to that of Tennant. Parsons consistently presents a strong desire for personal advancement and gainful employment, yet his work history demonstrates his inability to hold a job.
As we find Parsons to be disabled on the basis of the record, we must now turn to the question of remedy. If the record as presented to the AU contains substantial evidence supporting a finding that the claimant was disabled, then a reviewing court may reverse and remand the case to the District Court for entry of an order granting benefits to the claimant. See, e.g., Baugus v. Secretary of Health and Human Services, 717 F.2d 443, 448 (8th Cir. 1983); Nelson v. Heckler, 712 F.2d 346, 349 (8th Cir. 1983); Tennant, 682 F.2d at 710-11; Zimiga v. Schweiker, 651 F.2d 611, 613 (8th Cir. 1981). In this case, Parsons has been consistently diagnosed at least since September 19, 1980 as having severe social and adjustment problems. If we remanded this case to the Secretary for vocational expert testimony regarding jobs which Parsons might have been capable of performing during the period between September 19, 1980 and July 1, 1981, such testimony would not erase or change the clinically observed and functionally corroborated fact that Parsons was mentally incapable of holding any job during that period. Where further hearings would merely delay receipt of benefits, an order granting benefits is appropriate. Tennant, 682 F.2d at 710.
Parsons’ demonstrated inability to retain employment, together with his chronic pattern of defensive overstatement, poor judgment, lack of insight, and weak social skills, all as diagnosed bn September 19, 1980, and corroborated by his work history and by subsequent psychiatric evaluations, lead us to the conclusion that the AU erred in failing to find that Parsons has been disabled since September 19, 1980 at the latest. We remand this case to the District Court with directions to enter judgment for Parsons awarding him disability benefits under 42 U.S.C. § 423 as of March 5, 1981.
. Simultaneously, Parsons filed an application for supplementa'ry security income (SSI) benefits for the same period. The 'claim for SSI benefits was granted, as the ALJ found Parsons suffering from a disability which began on March 5, 1982.
. A claimant’s insurance coverage for disability benefits (insured status) continues as long as he meets the minimum earnings requirements under those provisions. The claimant here last met those requirements on June 30, 1981. It is' well-settled that the claimant must have been disabled within the meaning of the Social Security Act on or before expiration of his insured status in order to be eligible for benefits.
Unlike disability benefits, there is no insured status requirement for SSI benefits. The benefit levels under the SSI provisions, however, are
. Dr. Burnap later wrote a letter which served as the basis for the ALJ’s decision awarding SSI benefits to Parsons. See discussion, infra.
. A drug used for control of manifestations of psychotic disorders. Also used to control anxiety and tension associated with somatic conditions. Physician's Desk Reference at 1910 (37th Ed. 1983).
. The first set of six disorders are the product of a “differential diagnosis.” This initial diagnoses indicates a “range" of disorders from which the patient may be suffering. Such diagnoses are used because many disorders have symptoms which are very similar, and at early stages of treatment a therapist may have insufficient information to determine which specific disorder is present.
. The mental disorders referred to in the text are defined in the American Psychiatric Association’s, Diagnostic and Statistical Manual of Mental Disorders (3rd ed. 1980) (DSM-III). The definitions used in this opinion are condensed from that volume. For additional information, see DSM-III at pages indicated.
. The patient complains of pain that cannot be traced to a physical origin. Such pain may mimic a specific disease, in this case a venereal disease or urinary tract infection. DSM-III at 247.
. The patient manifests a psychological problem or conflict as a physical limitation, e.g., blindness, paralysis of an arm or another disorder occurring as an outgrowth of a psychological problem. DSM-III at 244.
. The patient unrealistically interprets physical signs or sensations as being abnormal. As a result, the patient becomes preoccupied with the fear or belief that he has a serious physical disease. DSM-III at 249.
. The patient’s physical symptoms suggest a serious disease but there are no organic findings. This disorder is distinguished from psychogenic pain disorder in that it does not necessarily focus on pain as the primary complaint, but may focus on another problem, such as a perceived disfiguring physical feature. DSM-III at 241, 251-52.
. The patient has physical or psychological problems which are under "voluntary” control. DSM-III gives the following explanation of the voluntary character of a factitious disorder.
The judgment that the behavior is under voluntary control is based, in part, on the patient's ability to simulate illness in such a way that he or she is not discovered. This involves decisions as to timing and concealment that require a degree of judgment and intellectual activity suggestive of voluntary control. However, these acts have a compulsive quality, in the sense that the individual is unable to refrain from a particular behavior, even if its dangers are known. They should therefore be considered ‘voluntary’ in the sense that they are deliberate and purposeful,*1338 but not in the sense that the acts can be controlled. Thus, in Factitious Disorders, behavior under voluntary control is used to pursue goals that are involuntarily adopted.
DSM-III at 285. In a factitious disorder, there is no apparent reason for the imagined illness or problem. DSM-III at 290.
. The patient shows indifference' to praise, criticism or feelings of others, and shows little or no desire for social involvements. These individuals tend to be cold and aloof. DSM-III at 310-11.
. The patient desires to enter social relationships but because of a hypersensitivity to rejection, tends to remain socially isolated. DSM-III at 323-24.
. Parsons’ social security application form indicates that he held other jobs at various times during summers and while in school. D.R. at 48.
. See supra note 7.
. The patient has a problem in adjusting to social situations which manifests in a depressed mood, tearfulness or hopelessness. DSM-III at 301.
. The patient manifests persecutory or grandiose delusions often associated with anxiety, anger, jealousy or argumentativeness. The manner of speaking may be stilted and overly formal. DSM-III at 191.
. This disorder features a freezing out of warm emotions. The individual is preoccupied with rules and details, but allocates time poorly and is very inefficient. The individual wants others to conform to his way of doing things. DSM-III at 326-27.
. See supra note 12.
Continue your research
- Eighth Circuit cases applying the burden-shift and vocational expert requirement to nonexertional mental impairments after Parsons
- Eighth Circuit decisions permitting direct award of Social Security benefits on appeal rather than remand for further proceedings
- Secondary sources addressing admissibility of post-insured-status medical evidence in Social Security disability adjudications
Case-law data current through December 31, 2025. Source: CourtListener bulk data.