MEMORANDUM OPINION AND ORDER
MARY M. ROWLAND, Magistrate Judge.
Plaintiff James Hurlbut brings this action pursuant to 42 U.S.C. § 405(g), seeking judicial review of the Social Security Commissioner's denial of his application for disability insurance benefits. For the reasons set forth below, the Court remands this case for further proceedings consistent with this opinion.
I. Procedural History
On August 22, 2008, Hurlbut filed concurrent applications for a period of disability and disability insurance benefits. (R. 55). In both applications, Hurlbut alleged disability with an onset date of January 31, 2008 based on depression, anxiety related disorders, panic attacks, over-aggression, and nerve damage to his arm. (R. 55, 62). The Commissioner initially denied those claims on December 23, 2008, and again upon reconsideration on February 13, 2009. (R. 62, 63). On February 20, 2009, Hurlbut filed a written request for a hearing. After proper notice, on July 15, 2010, an Administrative Law Judge ("ALJ") conducted a hearing. (R. 84). Hurlbut was represented at that hearing by attorney Michael A. Glazer. On October 26, 2010, the ALJ issued a written opinion, finding that Hurlbut was not "disabled" under the Social Security Act. Hurlbut then requested Appeals Counsel review, but the request was denied, rendering the ALJ's decision final. Hurlbut then requested judicial review, for which this Court has jurisdiction pursuant to 42 U.S.C. § 405(g). Pursuant to the consent of the parties and 28 U.S.C. § 636(c), the case was reassigned from the District Judge to Magistrate Judge Nolan on February 27, 2012 for all further proceedings, including entry of final judgment. (Dkt. 8). Following Judge Nolan's retirement from the bench, the case was reassigned to Magistrate Judge Rowland on October 1, 2012. (Dkt. 14).
II. Summary of Administrative Record
James Hurlbut was born on August 14, 1977. (R. 57). He is single and lives with mother. (R. 31-32).
Hurlbut suffers from an anxiety disorder. He testified that he experiences anxiety attacks at least once a week, which he described as "[a] suffocating type of feeling." (R. 36). "I feel like I'm having a heart attack." (R. 37). Hurlbut stated that he tries to avoid things that trigger his attacks, like crowds or intense light and sound. (R. 37). "I detest crowds of any kind." (R. 48). Hurlbut recounted, for example, that he will sometimes be in a check-out line at a store and feel an attack coming on; and he will have put down all his items and leave. (R. 38). He also described a constant "foreboding feeling like something bad is going to happen." (R. 41). He described his sleep at night is "awful." (R. 44). Hurlbut also suffers from a depressive disorder. He experiences sadness and crying spells "constantly, " although they typically only last a few minutes at a time. (R. 39). He has frequent trouble with headaches, which are "not really" relieved by pain medication. (R. 40). He has thought of harming himself. (R. 41).
Hurlbut reported that he does not have many friends, only "a couple." (R. 38). He talks to friends and acquaintances on-line, more than in person. (R. 49).
Hurlbut is computer literate and a voracious reader. (R. 48-49). His only prior job experience referenced in the record was a part-time job at Capital Fitness, where Hurlbut worked at the front desk. (R. 32). Hurlbut reported that he was let go from that job because he had trouble interacting with customers. (R. 33).
Treating physicians, Pillars Mental Health Services. The record includes extensive notes from Hurlbut's treating physicians at Pillars, a community organization that provides mental health services. (R. 487-505). Hurlbut received treatment there from 2007 to 2011. (R. 478-518). Hurlbut's primary psychiatrist, Dr. Brendan Beresford, diagnosed Hurlbut with major depressive order, generalized anxiety disorder, and obsessive compulsive disorder. (R. 452). The notes indicate that Hurlbut complained, on multiple occasions, of trouble sleeping. (R. 478-79). On March 4, 2009, Dr. Beresford noted that Plaintiff was having anxiety episodes associated with confusion, and that he felt down and isolated. (R. 488). On April 22, 2009, Dr. Beresford observed Hurlbut as "more depressed" and "irritable." (R. 565). On May 20, 2009, he noted Hurlbut was "anxious... almost panicky" and "was tearful in therapy." (R. 566). On July 22, 2009, Hurlbut was observed as "very distraught, depressed, tearful, anxious." (R. 569). On September 2, 2009, Dr. Beresford noted some improvement in Hurlbut's depression, but observed that he was still irritable. (R. 571). On October 7, 2009, Hurlbut reported that he was o.k., but he reported continued tearfulness, crying spells, panic attacks, loss of interest in activities, anxiety, nervousness, aggression, thoughts about harming himself and others, fearfulness, and paranoia. (R. 573-74). Records indicate that Hurlbut "only leaves [the] house [for] doctor appointments, therapy" and that his "socialization is limited to family, medical appointments and a few friends." (R. 518-19). When depressed, Hurlbut "is not able to concentrate or complete tasks." (R. 605-08).
On March 25, 2009, Dr. Beresford completed a detailed Mental Disorders Report. (R. 520-523). The report states that Hurlbut experiences problems with motivating himself, persisting, interacting with people, and regulating his mood. The report also notes that Hurlbut has poor focus and attention and poor memory for details. It also describes Hurlbut's general response to treatment as poor. (R. 521). Dr. Bresford opined that Hurlbut suffers from "marked" limitations in activities of daily living; social functioning; and concentration, persistence, or pace. Similarly, on May 27, 2010, Hurlbut's therapist at Pillars, Vernalynne Evano, completed a report stating that Hurlbut suffers from marked limitations in the same three categories of functioning. (R. 518-519).
DDS Examinations. Also before the ALJ was a psychological evaluation prepared by a state agency psychiatrist from the Illinois Department of Disability Determination Services, Dr. Terry Travis. (R. 551-564). Dr. Travis prepared his evaluation on the basis of the medical records on file with the Social Security Administration. Dr. Travis did not consult with Hurlbut in person. Dr. Travis's psychiatric evaluation (referred to as a "psychiatric review technique") rated Mr. Rutherford's condition under the following listings: 12.04 Affective Disorders and 12.06 Anxiety-Related Disorders (Diagnosed adjustment disorder with depressed and anxious mood). (R. 554, 556).
Dr. Travis assessed Hurlbut's functional limitations (known as "B criteria"), and found that he has only "moderate" limitations in activities of daily living; social functioning; and concentration, persistence, or pace. (R. 561).
Consultative examinations. The ALJ also considered a report prepared by consultative examiner Carole Rosanova M.D., in which she was asked whether she agreed with the state agency psychiatrist's assessment of Hurlbut's impairments. (R. 472-76). Dr. Rosanova reviewed medical records and also examined Hurlbut in-person. (R. 472). She ...