The opinion of the court was delivered by: VICTOR B. Kenton United States Magistrate Judge
MEMORANDUM OPINION AND ORDER (Social Security Case)
This matter is before the Court for review of the decision by the Commissioner of Social Security denying Plaintiff's application for disability benefits. Pursuant to 28 U.S.C. §636(c), the parties have consented that the case may be handled by the Magistrate Judge. The action arises under 42 U.S.C. §405(g), which authorizes the Court to enter judgment upon the pleadings and transcript of the Administrative Record ("AR") before the Commissioner. The parties have filed the Joint Stipulation ("JS"), and the Commissioner has filed the certified AR.
Plaintiff raises the following issues:
1. Whether the Administrative Law Judge's ("ALJ") finding at step two that Plaintiff suffers no legally severe mental impairment is based on a proper evaluation of the opinions of the treating internist and of consultative and non-examining psychiatrists;
2. Whether the ALJ's finding that Plaintiff can perform a slightly reduced range of exertionally light work is based on a proper consideration of the fatigue flowing from his hepatitis C; and
3. Whether the rejection of the credibility of Plaintiff's fatigue is based on substantial evidence.
This Memorandum Opinion will constitute the Court's findings of fact and conclusions of law. After reviewing the matter, the Court concludes that for the reasons set forth, the decision of the Commissioner must be reversed.
I. THE ALJ'S DETERMINATION THAT PLAINTIFF HAS NO SEVERE MENTAL IMPAIRMENT IS UNSUPPORTABLE
In the ALJ's decision, following a hearing necessitated by a remand from the Appeal Council (AR 43-45), the ALJ found that Plaintiff does not have a severe mental impairment. (AR 24.) Plaintiff challenges that finding, and the Court agrees.
A. Summary of Evidence Pertaining to Mental Health
Plaintiff's treating physician, Dr. Chen, is a doctor of osteopathy, who has seen Plaintiff since November 2005. (AR 352-422.) In his initial evaluation on November 1, 2005, Plaintiff complained of depression, loss of usual interests, loss of concentration, and a recent onset of suicidal ideation. (AR 419.) Dr. Chen prescribed the psychotropic medications Klonopin, Lexapro, and Seroquel. (AR 419-22.) Examination of the longitudinal record indicates that, due to side effects, Plaintiff's psychotropic medications were often adjusted by Dr. Chen. For example, in December 2005, Plaintiff indicated he had stopped taking Lexapro due to dizziness, headaches, and irritability. (AR 412-13.) Dr. Chen diagnosed Plaintiff with bipolar disorder and anxiety, and he continued prescriptions for Klonopin and Seroquel. (AR 412-13.) Plaintiff refused Dr. Chen's referral for psychiatric treatment. Dr. Chen refilled the Klonopin prescription, and began prescribing Depakote. (AR 392.) The latter drug led to complaints of side effects, and it was discontinued. (AR 388.) In August 2006, Plaintiff complained of anxiety, depression and regular mood swings. (AR 375.) Plaintiff tried to avoid taking the Depakote until he felt he really needed it. (Id.) That drug was refilled, and Plaintiff also received a prescription for Lorazepam, which was refilled in late 2006, and early 2007. Despite reporting that he felt better on Depakote (AR 372-73, 366-67, 365), Plaintiff reported feeling anxious, was again diagnosed with anxiety and bipolar disorder, and his medications were refilled in March 2007. (AR 353-54.)
In January 2007, Dr. Chen completed a Multiple Impairments Questionnaire, finding that due to his bipolar disorder, Plaintiff's physical symptoms are exacerbated, that he remains anxious and has sleep difficulties, despite the Depakote. Dr. Chen further opined that Plaintiff's symptoms would likely increase if he were placed in a competitive work environment; that he is incapable of doing a full-time competitive job; that emotional factors contribute to the severity of his symptoms and functional limitations; and that he is only capable of tolerating a low-stress work environment. (AR 346-47.) He would likely be absent from work more than three times a month and psychological limitations would affect his ability to work at a regular job on a sustained basis. (AR 348.)
On August 29, 2005, Plaintiff received a complete psychiatric evaluation ("CE") at the request of the Department of Social Security, from Dr. Roux (AR 302-312.) Dr. Roux diagnosed major depressive disorder, recurrent, severe, without psychotic features, on Axis I, without ruling out bipolar II disorder. (AR 309.) As a prognosis, Dr. Roux reported the following:
"It is possible that with adequate and appropriate treatment (which could feasibly include psychotropic medication adjustments, possibly augmented by counseling), [Plaintiff] could see at least some reduction in his various mood symptoms. However, given the overall chronicity, severity, and multiplicity of his symptoms - further compounded by his physical pain and other stressors - his overall prognosis currently only ...