Luther D. Mullen v. Otis Bowen, Secretary of Health and Human Services, Richard G. Shepherd v. Otis Bowen, Secretary of Health and Human Services

DAVID A. NELSON, Circuit Judge,

concurring.

I concur in the judgment of the court and in Judge Engel’s comprehensive explication of that judgment. My purpose in writing separately is to add a sort of perambulato-ry footnote prompted mainly by Judge Martin’s dissent.

The question posed by Judge Martin— and it is a fair question, obviously — is whether the plain language of the 1976 amendments to the regulations did not introduce a significant limitation on the power of the Secretary to review AU decisions. I agree with the court’s answer to that question. Given what the regulations said before they were amended in 1976, given what the Secretary said — and did not say — in connection with the adoption of the 1976 amendments, and given what Congress said just before the most recent recasting of the regulations in 1980, it seems to me we would not be justified in constru *555 ing the language now found in 20 C.F.R. § 404.970 (a) as having effected the curtailment in administrative appellate jurisdiction that might seem implicit in the language of the section if the language were to be considered in isolation.

It is indisputable that for many years prior to November of 1976 the regulations gave the Appeals Council the broadest possible discretion to decide if a given decision should be reviewed. (We are not talking now of the standard of review to be used in deciding the merits of the case at the end of the review process, of course; we are addressing only the power of the Council to initiate a review, much in the way the United States Supreme Court initiates a review when it issues a writ of certiorari.) Whether the Council’s discretionary power to review was exercised at the request of a party or ex mero motu, the power was in no way limited by anything in the text of the pre-1976 regulations. If it compromised the integrity of the factfinding process at the AU level, leaving the process exposed to the undue influence of a Secretary anxious to protect the public purse, the fact remains that the Council’s broad discretionary review power did in fact exist and had existed for a long time.

On St. Patrick’s day of 1976 the Secretary approved a notice of proposed rule-making that was published a few days later in accordance with the informal rulemaking procedure established by the Administrative Procedure Act. 41 Fed.Reg. 12035 et seq. (March 23, 1976). One of the regulatory changes of which notice was there given consisted of the proposed addition of a new section 404.947(a), captioned “Basis for review of the presiding officer’s decision or dismissal by Appeals Council.” The proposed new section, the stated purpose of which corresponded to its caption, specified four types of situation in which the Appeals Council, “on its own motion or on request for review, will review a hearing decision or dismissal.” The description of the four situations in which Appeals Council review “will” be granted is substantially identical to the language now found in § 404.970.

In proposing the new section, the Secretary said nothing about shoring up the integrity of the factfinding process at the hearing officer level. Neither was any such purpose hinted at in the mandatory statement of basis and purpose issued by the Secretary when the proposed amendment was adopted, without change, in November of 1976. If the Secretary’s purpose was to limit the scope of the Council’s review power, the Administrative Procedure Act suggests it would have been appropriate for him to say so. (“[T]he agency shall incorporate ... a concise general statement of [the rule’s] basis and purpose.” 5 U.S.C. § 553 (c) (Emphasis supplied.)) It is significant, therefore, that far from articulating a design to add to the AU’s independence at the expense of the Council’s power to review, the Secretary stated that the amendments “have no major program significance____” 41 Fed.Reg. 51585 (November 23, 1976.)

It is true that the draftsman of the new section did not amend the provision that had long authorized dissatisfied litigants to seek Appeals Council review, or the provision that had long authorized the Council to initiate review on its own motion, in order to make explicit what had always been implicit in those provisions: namely, that the Appeals Council had power to review decisions “for any reason.” But by the same token, neither the amended regulations nor the accompanying statement describing their basis and purpose said explicitly that the Appeals Council could not continue to review decisions for any reason. If we are to conclude that the purpose of the amendments was to cut back the discretion that the Appeals Council had always enjoyed, therefore, we must reach this conclusion by drawing an inference that would seem highly dubious absent any explicit declaration of a purpose to restrict Appeals Council review.

Is it reasonable, against this background, to read the words of the new section as non-restrictive? I think so, if one bears in mind not only the rulemaking requirements *556 of the Administrative Procedure Act, but also the fact that before 1976 the regulations gave litigants no hint of the sort of considerations that might move the Appeals Council to exercise its certiorari-like review power. The new section supplied that want. With the introduction of the new section, I think, the agency was telling litigants, in effect, “the Appeals Council will issue what amounts to a writ of certio-rari if you can convince the Council that there appears to have been an abuse of discretion in your case, or an error of law, or findings and conclusions not supported by substantial evidence, or if you can persuade the Council that yours is a case presenting a broad policy or procedural issue which may affect the general public interest.” By the same token, the agency was saying, “the Council may issue a writ of certiorari on its own motion if it thinks one of these four situations exists.” But that is a far cry from saying “the discretionary power the Council has always had to issue a writ of certiorari for any other reason is hereby revoked.” The new section did not create the discretionary review power of the Appeals Council, and I do not think it curtailed it.

It is worth noting, finally, that the 1980 recodification of the regulations ( 45 Fed. Reg. 52078 (August 5, 1980)) came eight weeks after Congress, “concerned that there is no formal ongoing review of the Social Security hearing decisions,” had directed the Secretary to implement a program of reviewing AU decisions on his own motion. (P.L. 96-265, § 304(g), 94 Stat. 441 , 456 (1980); House Conf. Rep. No. 96-944, 96th Cong., 2d Sess., reprinted in 1980 U.S. Code Congressional and Administrative News, 1392, 1405.) The agency may have missed an opportunity, in the 1980 rulemaking, to state explicitly that the power to review AU decisions could still be exercised “for any reason,” and to make its usage of language more harmonious with that in other parts of the regulations — as the usage presumably would have been if all the regulations had been written by one person at one time — but if the agency had amended the regulations in 1980 to say what Judge Martin suggests they were intended to mean, it would have been flying in the teeth of the recently announced Congressional determination that own-motion review should be expanded rather than contracted.

Thus I am unable to agree with Judge Martin’s interpretation of these rather awkwardly drafted regulations, notwithstanding that I think the language of the regulations could bear the interpretation he urges if divorced from its history.