OPINION AND ORDER
JANICE M. STEWART, Magistrate Judge.
Plaintiff, Chelsea Sprague ("Sprague"), seeks judicial review of the final decision by the Social Security Commissioner ("Commissioner") denying her application for Supplemental Security Income ("SSI") under Title XVI of the SSA, 42 USC §§ 1381-1383f. This court has jurisdiction to review the Commissioner's decision pursuant to 42 USC § 405(g) and § 1383(c)(3). All parties have consented to allow a Magistrate Judge to enter final orders and judgment in this case in accordance with FRCP 73 and 28 USC § 636(c). For the reasons set forth below, the Commissioner's decision is REVERSED and REMANDED for further proceedings.
Sprague protectively filed for SSI on November 26, 2008, alleging a disability onset date of October 15, 2002. Tr. 124-29. Her application was denied initially and on reconsideration. Tr. 73-87. On November 30, 2010, Administrative Law Judge ("ALJ") Catherine R. Lazuran held a hearing at which Sprague was represented and testified, as did her mother, Brenda Witherspoon, and a Vocational Expert ("VE"), Gail Young. Tr. 35-72. The ALJ issued a decision on January 28, 2011, finding Sprague not disabled within the meaning of the Act. Tr. 10-21. On April 11, 2011, after considering Sprague's additional evidence, the Appeals Council denied her request for review, making the ALJ's decision the Commissioner's final decision subject to review by this court. Tr. 1-5. 20 CFR §§ 416.1481, 422.210.
Born in 1989, Sprague was 21 years old at the time of the hearing before the ALJ. Tr. 38, 124. She has a GED and no past relevant work experience. Tr. 38, 163. Sprague alleges that she is unable to work due to the combined impairments of Fanconi's anemia and schizoaffective disorder. Tr. 86-87, 136.
Disability is the "inability to engage in any substantial gainful activity by reason of any medically determinable physical or mental impairment which can be expected to result in death or which has lasted or can be expected to last for a continuous period of not less than 12 months[.]" 42 USC § 423(d)(1)(A). The ALJ engages in a five-step sequential inquiry to determine whether a claimant is disabled within the meaning of the Act. 20 CFR § 416.920; Tackett v. Apfel, 180 F.3d 1094, 1098-99 (9th Cir 1999).
At step one, the ALJ determines if the claimant is performing substantial gainful activity. If so, the claimant is not disabled. 20 CFR § 416.920(a)(4)(i) & (b).
At step two, the ALJ determines if the claimant has "a severe medically determinable physical or mental impairment" that meets the 12-month durational requirement. 20 CFR §§ 416.909, 416.920(a)(4)(ii) & (c). Absent a severe impairment, the claimant is not disabled. Id.
At step three, the ALJ determines whether the severe impairment meets or equals an impairment "listed" in the regulations. 20 CFR § 416.920(a)(4)(iii) & (d); 20 CFR Pt. 404, Subpt. P, App. 1 (Listing of Impairments). If the impairment is determined to meet or equal a listed impairment, then the claimant is disabled.
If adjudication proceeds beyond step three, the ALJ must first evaluate medical and other relevant evidence in assessing the claimant's residual functional capacity ("RFC"). The claimant's RFC is an assessment of work-related activities the claimant may still perform on a regular and continuing basis, despite the limitations imposed by his or her impairments. 20 CFR § 416.920(e); Social Security Ruling ("SSR") 96-8p, 1996 WL 374184 (July 2, 1996).
At step four, the ALJ uses the RFC to determine if the claimant can perform past relevant work. 20 CFR § 416.920(a)(4)(iv) & (e). If the claimant cannot perform past relevant work, then at step five, the ALJ must determine if the claimant can perform other work in the national economy. Bowen v. Yuckert, 482 U.S. 137, 142 (1987); Tackett, 180 F.3d at 1099; 20 CFR § 416.920(a)(4)(v) & (g).
The initial burden of establishing disability rests upon the claimant. Tackett, 180 F.3d at 1098. If the process reaches step five, the burden shifts to the Commissioner to show that jobs exist in the national economy within the claimant's RFC. Id. If the Commissioner meets this burden, then the claimant is not disabled. 20 CFR §§ 416.920(a)(4)(v) & (g), 416.960(c).
At step one, the ALJ concluded that Sprague has not engaged in substantial gainful activity since November 26, 2008, the date that the application was protectively filed. Tr. 12. At step two, the ALJ determined that Sprague has the severe impairments of Fanconi's anemia, degenerative disc disease of the lumbar and thoracic spine, and a mood disorder. Id.
At step three, the ALJ concluded that Sprague does not have an impairment or combination of impairments that, either singly or in combination, meets or equals any of the listed impairments. Tr. 13.
With respect to how her impairments affect her ability to work, the ALJ concluded that Sprague has the RFC to perform light work, except she can only "occasionally climb, stoop, kneel, crouch and crawl. [She] should avoid exposure to hazards such as unprotected heights. [She] can do simple, routine, repetitive tasks but not detailed tasks and can get along with others." Tr. 14.
At step four, the ALJ determined that Sprague has no past relevant work. Tr. 20. At step five, the ALJ found that given Sprague's age, education, and RFC, she was capable of performing two jobs identified by the VE that exist in significant numbers in the national economy. Tr. 20-21.
Accordingly, the ALJ determined that Sprague was not disabled at any time between November 26, 2008, the date the application was protectively filed, and the date of her decision, January 28, 2011. Tr. 21.
STANDARD OF REVIEW
The reviewing court must affirm the Commissioner's decision if it is based on proper legal standards and the findings are supported by substantial evidence in the record. 42 USC § 405(g); Lewis v. Astrue, 498 F.3d 909, 911 (9th Cir 2007). This court must weigh the evidence that supports and detracts from the ALJ's conclusion. Lingenfelter v. Astrue, 504 F.3d 1028, 1035 (9th Cir 2007), citing Reddick v. Chater, 157 F.3d 715, 720 (9th Cir 1998). The reviewing court may not substitute its judgment for that of the Commissioner. Ryan v. Comm'r of Soc. Sec. Admin., 528 F.3d 1194, 1205 (9th Cir 2008), citing Parra v. Astrue, 481 F.3d 742, 746 (9th Cir 2007); see also Edlund v. Massanari, 253 F.3d 1152, 1156 (9th Cir 2001). Where the evidence is susceptible to more than one rational interpretation, the Commissioner's decision must be upheld if it is "supported by inferences reasonably drawn from the record.'" Tommasetti v. Astrue, 533 F.3d 1035, 1038 (9th Cir 2008), quoting Batson v. Comm'r of Soc. Sec. Admin., 359 F.3d 1190, 1193 (9th Cir 2004); see also Lingenfelter, 504 F.3d at 1035.
Sprague argues that the ALJ erred by: (1) failing to account for all of her limitations in her RFC; (2) improperly discounting her credibility; and (3) improperly rejecting her mother's testimony.
Sprague contends that the RFC assigned by the ALJ is inaccurate because it fails to properly account for the limitations caused by her Fanconi's anemia, mood disorder, fibromyalgia, seizures, and anxiety. The RFC assessment describes the work-related activities a claimant can still perform on a sustained, regular and continuing basis, despite the functional limitations imposed by her impairments. 20 CFR § 416.945(a); SSR 96-8p. The ALJ must reach the RFC assessment based on all the relevant evidence in the case record, including medical reports and the effects of symptoms that are reasonably attributable to a medically determinable impairment. Robbins v. Soc. Sec. Admin., 466 F.3d 880, 883 (9th Cir 2006). The ALJ, however, need not incorporate limitations identified through claimant testimony or medical opinions that the ALJ permissibly discounted. Batson, 359 F.3d at 1197.
A. Fanconi's Anemia
Although the ALJ concluded that her Fanconi's anemia is a severe impairment, Sprague contends that the RFC fails to fully account for the associated fatigue, pain, and sustainability issues.
The ALJ found that "the medical record in December 2009 shows stable decreased blood counts and no past marrow abnormality, " and that before December 2009, Sprague had no laboratory testing done for nearly two years due to lack of insurance. Tr. 16. The ALJ also gave "great weight" to the opinion of DeWayde Perry, M.D., an examining physician, who concluded on March 5, 2009, that despite her complaints of "daily fatigue, chronic bone and joint pain, and occasional blurry vision, " Sprague has the physical capacity to stand or walk up to six hours, carry 20 pounds occasionally and 10 pounds frequently, and has no limitations on her ability to sit, climb, or balance, though due to her joint pain, she should only occasionally stoop, kneel, crouch, and crawl. Id. Dr. Perry also concluded that Sprague does not need an assistive device and has no manipulative or environmental limitations. Id. Finding this opinion to be consistent with the medical record and opinions of the state agency consulting physicians, the ALJ adopted these limitations in Sprague's RFC. Id. However, in "an abundance of caution, " the ALJ also added restrictions on climbing and hazards due to Sprague's complaints of dizziness. Id.
The ALJ went on to note that two state agency consulting physicians, Neal Berner, M.D., and Richard Alley, M.D., also agreed with Dr. Perry's conclusions regarding Sprague's physical capacity. Tr. 17. Dr. Berner and Dr. Alley concluded that Sprague could perform light work, except that she can only frequently (as opposed to continuously) balance and climb ramps and stairs and occasionally stoop, kneel, crouch, crawl, and climb ladders, ropes, and scaffolds. Id. The ALJ incorporated the limitations set forth by Drs. Perry, Berner, and Alley by concluding that Sprague has the RFC to perform light work, but can only "occasionally climb, stoop, kneel, crouch, and crawl" and should also "avoid exposure to hazards such as unprotected heights." Tr. 14.
Though the ALJ does not specifically ascribe any psychological limitations related to Fanconi's anemia, she does give weight to the opinions of several physicians who concluded that Sprague can understand, remember, and carry out simple (but not detailed) instructions, and could probably get along well with people. Id (citing the conclusions of examining psychiatrist, Gayle Smolen, M.D., and consulting psychologists, Robert Henry, Ph.D., and Paul Rethinger, Ph.D.). The ALJ incorporated these limitations into the RFC ...