The opinion of the court was delivered by: John E. Mcdermott United States Magistrate Judge
MEMORANDUM OPINION AND ORDER REVERSING DECISION OF THE COMMISSIONER OF SOCIAL SECURITY AND REMANDING FOR FURTHER PROCEEDINGS PROCEEDINGS
On December 6, 2011, Raymond E. Otto ("Plaintiff") filed a Complaint seeking review of the decision by the Commissioner of the Social Security Administration ("Commissioner") finding, in a continuing disability review, that his disability had ceased as of February 1, 2008. The Commissioner filed an Answer on March 16, 2012. On July 12, 2012, the parties filed a Joint Stipulation ("JS"). The matter is now ready for decision.
Pursuant to 28 U.S.C. § 636(c), both parties consented to proceed before the undersigned Magistrate Judge. After reviewing the pleadings, transcripts, and administrative record ("AR"), the Court concludes that the Commissioner's decision must be reversed and remanded for further proceedings in accordance with this Memorandum Opinion and Order and with law.
On January 6, 1992, Plaintiff filed an application for Social Security Disability Insurance benefits. (JS 1.) In January 1992, Plaintiff was deemed disabled since February 1, 1988, due to schizophrenia and antisocial personality disorder. (AR 294.)
In a continuing disability review in 2008, Plaintiff was determined to have experienced medical improvement and his benefits were terminated as of February 1, 2008. (AR 430.) Plaintiff filed an appeal of this determination and a disability hearing officer determined that Plaintiff was no longer disabled. (AR 330-41.) Plaintiff timely requested a hearing which was held before Administrative Law Judge ("ALJ") David Ganly on February 23, 2010. (AR 342, 600-39.) Plaintiff appeared and testified at the hearing but was not represented by counsel. (AR 602.) A medical expert and psychological expert also testified at the hearing. (AR 610-30.) The ALJ issued a decision on April 9, 2010, upholding the cessation of benefits based on medical improvement. (AR 34-41.) On October 13, 2011, the Appeals Council denied review of the ALJ's decision. (AR 9-12.)
As reflected in the Joint Stipulation, there are two disputed issues: whether the ALJ properly assessed the medical evidence, and whether the ALJ properly evaluated Plaintiff's credibility.
Under 42 U.S.C. § 405(g), this Court reviews the ALJ's decision to determine whether the ALJ's findings are supported by substantial evidence and free of legal error. Smolen v. Chater, 80 F.3d 1273, 1279 (9th Cir. 1996); see also DeLorme v. Sullivan, 924 F.2d 841, 846 (9th Cir. 1991) (ALJ's disability determination must be supported by substantial evidence and based on the proper legal standards).
Substantial evidence means "'more than a mere scintilla,' but less than a preponderance." Saelee v. Chater, 94 F.3d 520, 521-22 (9th Cir. 1996) (quoting Richardson v. Perales, 402 U.S. 389, 401 (1971)). Substantial evidence is "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." Richardson, 402 U.S. at 401 (internal quotation marks and citation omitted).
This Court must review the record as a whole and consider adverse as well as supporting evidence. Robbins v. Soc. Sec. Admin., 466 F.3d 880, 882 (9th Cir. 2006). Where evidence is susceptible to more than one rational interpretation, the ALJ's decision must be upheld. Morgan v. Comm'r of the Soc. Sec. Admin., 169 F.3d 595, 599 (9th Cir. 1999). "However, a reviewing court must consider the entire record as a whole and may not affirm simply by isolating a 'specific quantum of supporting evidence.'" Robbins, 466 F.3d at 882 (quoting Hammock v. Bowen, 879 F.2d 498, 501 (9th Cir. 1989)); see also Orn v. Astrue, 495 F.3d 625, 630 (9th Cir. 2007).
THE SEQUENTIAL EVALUATION
The Social Security Act defines disability as 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 . . . can be expected to last for a continuous period of not less than 12 months." 42 U.S.C. §§ 423(d) (1)(A), 1382c(a)(3)(A). "Once a claimant has been found to be disabled, . . . a presumption of continuing disability arises in [the claimant's] favor" and the Commissioner "bears the burden of producing evidence sufficient to rebut the presumption of continuing disability." Bellamy v. Sec'y of Health & Human Servs., 755 F.2d 1380, 1381 (9th Cir. 1985).
A recipient whose condition has improved medically so that he is able to engage in substantial gainful activity is no longer disabled. 42 U.S.C. § 1382c(a)(4); 20 C.F.R. §§ 404.1594, 416.994; Flatten v. Sec'y of Health & Human Servs., 44 F.3d 1453, 1459 (9th Cir. 1995). A medical improvement is any decrease in the medical severity of [a recipient's] impairment(s) which was present at the time of the most recent favorable medical decision that [the recipient was] disabled or continued to be disabled. A determination that there has been a decrease in medical severity must be based on changes (improvement) in the symptoms, signs and/or laboratory findings associated with [the recipient's] impairment(s). 20 C.F.R. §§ 404.1594(b)(1), 416.994(b)(1)(i) (internal citation omitted).
To determine if a claimant continues to be disabled, the ALJ must follow a seven- or eight-step sequential evaluation process.*fn1 20 ...