The opinion of the court was delivered by: Andrew J. Wistrich United States Magistrate Judge
Plaintiff filed this action for judicial review of the decision of the Commissioner of the Social Security Administration (the "Commissioner") denying plaintiff's application for disability insurance benefits. The parties have filed a Joint Stipulation ("JS") setting forth their contentions with respect to each disputed issue.
The parties are familiar with the procedural history of this case, which is summarized in the Joint Stipulation. [See JS 2]. In a February 2003 hearing decision, an Administrative Law Judge ("ALJ") denied plaintiff's benefits application on the ground that he retained the residual functional capacity ("RFC") to perform medium work and was not precluded from performing his past relevant work. [Administrative Record ("AR") 123-127]. The Appeals Council granted plaintiff's request for review, vacated the February 2003 ALJ decision, and remanded the case for another hearing. [See JS 2; AR 135- 137].
Following a supplemental hearing, a second ALJ issued a written decision denying benefits in July 2006. [AR 21-26]. The second ALJ found that plaintiff retained the RFC to perform light work with the option of sitting or standing at will, and that plaintiff's RFC did not prevent him from performing work available in significant numbers in the national economy. Accordingly, the second ALJ found plaintiff "not disabled" at step five of the sequential evaluation at any time through March 31, 2006, plaintiff's date last insured. [AR 21-26].
On March 14, 2008, the Appeals Council granted plaintiff's request for review of the second ALJ's July 2006 decision, and issued a new decision that was partly favorable to plaintiff. [AR 11-14]. The Appeals Council adopted the findings made by the second ALJ at steps one through four of the sequential evaluation procedure. The Appeals Council also adopted the second ALJ's finding at step five and his conclusion that plaintiff was not disabled, but only with respect to the period ending on March 30, 2006, one day before expiration of plaintiff's insured status. [AR 11-12].
The Appeal Council did not adopt the second ALJ's finding or conclusions at step five concerning the period beginning on March 31, 2006, the date plaintiff's insured status expired. [JS 3; AR 11-14]. The Appeals Council reasoned that plaintiff was within 6 months of attaining age 55 on that date, and therefore that the question of his disability fell within the Commissioner's "borderline age policy." See 20 C.F.R. § 404.1563(b)("We will not apply the age categories mechanically in a borderline situation. If you are within a few days to a few months of reaching an older age category, and using the older age category would result in a determination or decision that you are disabled, we will consider whether to use the older age category after evaluating the overall impact of all the factors of your case."). The Appeals Council concluded that the "very significant functional adversities" represented by plaintiff's need to sit or stand at will created a "borderline age situation" warranting treating plaintiff as if he had attained the age of 55 years as of March 31, 2006. Applying Rule 202.06 of the Medical-Vocational Guidelines, 20 C.F.R. Part 404, Subpart P, Appendix 2, the Appeals Council concluded that plaintiff was disabled beginning on March 31, 2006, his date last insured. [JS 3; AR 11-14].
The Commissioner's denial of benefits should be disturbed only if it is not supported by substantial evidence or is based on legal error. Stout v. Comm'r, Social Sec. Admin., 454 F.3d 1050, 1054 (9th Cir. 2006); Thomas v. Barnhart, 278 F.3d 947, 954 (9th Cir. 2002). "Substantial evidence" means "more than a mere scintilla, but less than a preponderance." Bayliss v. Barnhart, 427 F.3d 1211, 1214 n.1 (9th Cir. 2005). "It is such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Burch v. Barnhart, 400 F.3d 676, 679 (9th Cir. 2005)(internal quotation marks omitted). The court is required to review the record as a whole and to consider evidence detracting from the decision as well as evidence supporting the decision. Robbins v. Social Sec. Admin, 466 F.3d 880, 882 (9th Cir. 2006); Verduzco v. Apfel, 188 F.3d 1087, 1089 (9th Cir. 1999). "Where the evidence is susceptible to more than one rational interpretation, one of which supports the [Commissioner's] decision, the [Commissioner's] conclusion must be upheld." Thomas, 278 F.3d at 954 (citing Morgan v. Comm'r of Social Sec. Admin., 169 F.3d 595, 599 (9th Cir.1999)).
Judicial review is limited to the Commissioner's "final decision." 42 U.S.C. § 405(g). The Appeals Council's decision, rather than the ALJ's decision, is the Commissioner's final decision in this case. See 20 C.F.R. §§ 404.955, 404.979, 404.981; Taylor v. Heckler, 765 F.2d 872, 875 (9th Cir. 1985).When the Appeals Council grants review, it "may affirm, modify or reverse" the ALJ's hearing decision. 20 C.F.R. § 404.979; Taylor, 765 F.2d at 875.
The Appeals Council adopted the findings and conclusions in the second ALJ's July 2006 decision at steps one through five of the sequential evaluation with respect to the period before March 31, 2006. The Appeals Council explained that it "found that the medical evidence supported the Administrative Law Judge's finding with respect to the claimant's credibility and [RFC], and that the claimant was not disabled through March 30, 2006." [AR 12]. Aside from that statement, the Appeals Council did not discuss or evaluate Dr. Sobol's reports or any other medical evidence. Therefore, the second ALJ's July 2006 decision ...