The opinion of the court was delivered by: Suzanne H. Segal United States Magistrate Judge
MEMORANDUM DECISION AND ORDER
Martha Pagano ("Plaintiff") brings this action seeking to overturn the decision of the Commissioner of the Social Security Administration (hereinafter the "Commissioner" or the "Agency") denying her application for Disability Insurance Benefits ("DIB"). The parties consented, pursuant to 28 U.S.C. § 636(c), to the jurisdiction of the undersigned United States Magistrate Judge. For the reasons stated below, the decision of the Agency is REVERSED and REMANDED for further proceedings.
Plaintiff filed an application for DIB on January 28, 2004. (Administrative Record ("AR") 84-86). She alleged a disability onset date of June 12, 2003, (AR 109), due to "back surgery low back pain." (AR 61). The Agency denied this claim on March 19, 2004. (AR 61-64).
Plaintiff filed a second application for DIB on April 26, 2005. (AR 94-96). She alleged a disability onset date of June 12, 2003, (AR 109), due to severe low back pain, neck and shoulder pain, S/P L4-5 posterior lumbar discectomy, S/P L4-5 fusion, and back pain and discomfort. (AR 65). The Agency denied this claim initially on June 24, 2005. (AR 65-69). Plaintiff requested reconsideration of this claim on August 14, 2005, with the assistance of an attorney. (AR 73). The Agency denied reconsideration on January 9, 2006. (AR 74-78). Plaintiff requested a hearing, (AR 79), which was held before Administrative Law Judge ("ALJ") Helen E. Hesse on March 27, 2007. (AR 722-60). Plaintiff appeared with counsel and testified. (Id.).
On June 19, 2007, the ALJ issued a decision denying benefits. (AR 26-38). Plaintiff sought review of the ALJ's decision before the Appeals Council, which denied her request on July 15, 2009. (AR 5-7). Thus, the ALJ's decision became the final decision of the Agency. Plaintiff commenced the instant action on September 9, 2009.
III. THE FIVE-STEP SEQUENTIAL EVALUATION PROCESS
To qualify for disability benefits, a claimant must demonstrate a medically determinable physical or mental impairment that prevents her from engaging in substantial gainful activity and that is expected to*fn1 result in death or to last for a continuous period of at least twelve months. Reddick v. Chater, 157 F.3d 715, 721 (9th Cir. 1998) (citing 42 U.S.C. § 423(d)(1)(A)). The impairment must render the claimant incapable of performing the work she previously performed and incapable of performing any other substantial gainful employment that exists in the national economy. Tackett v. Apfel, 180 F.3d 1094, 1098 (9th Cir. 1999) (citing 42 U.S.C. § 423(d)(2)(A)).
To decide if a claimant is entitled to benefits, an ALJ conducts a five-step inquiry. 20 C.F.R. § 416.920. The steps are:
(1) Is the claimant presently engaged in substantial gainful activity? If so, the claimant is found not disabled. If not, proceed to step two.
(2) Is the claimant's impairment severe? If not, the claimant is found not disabled. If so, proceed to step three.
(3) Does the claimant's impairment meet or equal the requirements of any impairment listed at 20 C.F.R. Part 404, Subpart P, Appendix 1? If so, the claimant is found disabled. If not, proceed to step four.
(4) Is the claimant capable of performing h[er] past work? If so, the claimant is found not disabled. If not, proceed to step five.
(5) Is the claimant able to do any other work? If not, the claimant is found disabled. If so, the claimant is found not disabled.
Tackett, 180 F.3d at 1098-99; see also Bustamante v. Massanari, 262 F.3d 949, 953-54 (9th Cir. 2001); 20 C.F.R. § 416.920(b)-(g)(1).
The claimant has the burden of proof at steps one through four, and the Commissioner has the burden of proof at step five. Bustamante, 262 F.3d at 953-54. If, at step four, the claimant meets her burden of establishing an inability to perform the past work, the Commissioner must show that the claimant can perform some other work that exists in "significant numbers" in the national economy, taking into account the claimant's residual functional capacity ("RFC"), age, education and*fn2 work experience. Tackett, 180 F.3d at 1100; 20 C.F.R. § 416.920(g)(1). The Commissioner may do so by the testimony of a vocational expert or by reference to the Medical-Vocational Guidelines appearing in 20 C.F.R. Part 404, Subpart P, Appendix 2 (commonly known as "the Grids"). Osenbrock v. Apfel, 240 F.3d 1157, 1162 (9th Cir. 2001). When a claimant has both exertional (strength-related) and non-exertional limitations, the Grids are inapplicable and the ALJ must take the testimony of a vocational expert. Moore v. Apfel, 216 F.3d 864, 869 (9th Cir. 2000).
The ALJ employed the five-step sequential evaluation process and concluded that Plaintiff was not disabled under the Social Security Act. (AR 29-38). At the first step, the ALJ found that Plaintiff had not engaged in substantial gainful activity since June 12, 2003. (AR 31). At step two, she found that Plaintiff had the following severe impairments: disorders of the cervical ...