United States District Court, N.D. Illinois, Eastern Division
MEMORANDUM OPINION AND ORDER
MICHAEL T. MASON, Magistrate Judge.
This case is before the Court on the parties' cross motions for summary judgment. Plaintiff Eileen Piskorek seeks a remand or an outright reversal of the Commissioner's decision to deny her request for a waiver concerning an overpayment of Disability Insurance Benefits ("DIB"). The Commissioner seeks summary judgment affirming the decision to deny the waiver. For the reasons set forth below, Piskorek's motion is granted, and the Commissioner's motion is denied.
Eileen Piskorek first applied for DIB in 1995, claiming that she was disabled because of depression. The Social Security Administration ("SSA") agreed, and Piskorek began receiving DIB shortly thereafter. She applied for Child's Insurance Benefits for her two children and that application was granted as well; her children began receiving benefits at the same time. Almost a decade later, the Administration advised her that she had been overpaid and needed to repay more than $87, 000.
Piskorek received a letter dated February 3, 2005, advising that the SSA:
restarted your Social Security disability payments during your extended period of eligibility because you were no longer doing substantial work. However, we now have information about your work and earnings that could affect your payments. Based upon this information, it appears we will decide that you are not entitled to payments for: March 1999, February 2000 through April 2000, May 2001, July 2001 and continuing. We are writing this letter to give you a chance to give us more information that you want us to consider.
Shortly thereafter, Piskorek advised the SSA to "please stop my disability"; she advised that she had been on a medical leave of absence from the State of Illinois but had started working full time for Streamwood Mental Health Center in April 2004. R. 79-80. The employment information she provided was consistent with the wage/earnings records provided by the employers; she represented that she worked at Rock Creek for about nine months in 1997 and 1998; she worked for just a couple of weeks at Palos Community Hospital; worked about 6 shifts over two months at NovaStaff; and worked about 10 shifts at NurseFinders. R. 84-85. In her communication to the SSA, Piskorek was forthcoming with information about her then current employment with Streamwood. However, she made it clear that she did not want the SSA to contact the employer for fear she would be fired because of her history of depression and anxiety. R. 80, 87.
On February 25, 2005, the SSA determined that Piskorek and her children had, in fact, been overpaid and demanded that they repay more than $87, 000 in benefits. Piskorek requested a waiver of the overpayment. Her request was denied on January 19, 2007 and then again on May 8, 2007. Records from those denials highlight the income Piskorek disclosed and suggest that the SSA believed Piskorek knew or should have known that she could not keep getting benefits while she was working and earning substantial income. E.g., R.125, 132.
Piskorek then requested a hearing before an Administrative Law Judge, and her case was initially assigned to ALJ Joseph Donovan, who held the requested hearing in Orland Park, Illinois on October 16, 2008. Piskorek appeared, represented by counsel (the same attorney who represents her here). The ALJ assigned both a medical expert and a vocational expert to appear at the hearing, but he did not call either to testify. R. 16. The ALJ did, however, hear argument from Piskorek's attorney and he heard testimony directly from Piskorek.
Piskorek's attorney conceded that she and her children were overpaid but argued that she was without fault in creating or maintaining the overpayment. In particular, he argued that she was diagnosed in 1996 with major depression and an anxiety disorder, that her impairments were found to be disabling in 1996, that her disabilities continued to the present time, and that they prevented her from really understanding what was going on with respect to her benefits. R. 138-139. Counsel argued that, because she was receiving benefits from both the State of Illinois and the Social Security Administration, she believed there was some kind of coordination of benefits between the two, and that communication to the State of Illinois was effective for both agencies. R. 139. He argued that, although she did work on again and off again during the years she received benefits, she worked for brief stints before being told she was not fit for the job; in other words, each attempt to return to work was unsuccessful. R. 140-142. Counsel also argued that "the regulations concerning trial work period and extended period of eligibility and substantial gainful activity and when a person can work and when they can't is really fairly complex for a layperson." R. 142. Her attorney also argued that, because Piskorek was working as a nurse, at a fairly high hourly wage rate, she could satisfy the threshold for substantial gainful activity or "SGA" working very few shifts, for short periods of time. R. 142. Yet, she was still considered to be disabled by the State of Illinois. R. 142. He also argued that her expenses exceeded her income by a significant amount, meaning that repayment would go against the purposes of Tile II. R. 144-145.
Piskorek then testified. She noted that she was first approved for Social Security Disability Insurance Benefits in 1996. R. 146. She testified that, at that time, she had already been receiving disability benefits from the State of Illinois for about six months; she testified that, prior to becoming disabled, she had worked as a nurse for the State of Illinois beginning in about June of 1986. R. 146-147. She testified that, after being adjudged disabled, she worked briefly at various locations - some through the State of Illinois and some through private staffing agencies - but never for very long. R. 148-154. She testified that she resigned from the State in 2003. R. 154. She testified that she did work after that, for Streamwood Mental Health Center beginning in February 2004, and then for Edwards Hospital in Naperville, beginning in June 2005; both jobs lasted about 18 months. R. 156-159. She testified that she went on medical leave from Edwards and then applied again for Social Security Disability Insurance Benefits; her application was approved a month or two before the hearing. R. 159. She testified that she was set to receive $1, 643 per month in benefits, but was advised that 100% of that monthly payment was being withheld because of the overpayment. R. 159-160. She testified that she was confused about when and how she had to be reevaluated by the Social Security Administration and about whether working as she was - on again and off again, with sporadic shifts at various places - was ok within the trial work period regulations. R. 160-161.
ALJ Donovan issued his decision on November 10, 2008. R. 16-20. He denied her request for a waiver of the uncontested overpayment, finding that Piskorek was "not without fault' in causing and accepting the overpayment" and that she "knew or should have known that the disability benefits she received and the Child's Insurance benefits she received for her two children for the period of March 1999, February 2000 through April 2000, May 2001, and July 2001 through November 2004 while she continued to work were not due her." R. 19. The ALJ also determined that "recovery of the overpayment amount would not defeat the purpose of the Act.'" R. 19. He therefore determined that the "overpaid total of $87, 300.00 must be recovered in incremental amounts." R. 19.
Piskorek appealed, and the Appeals Council denied review on October 5, 2010, finding that there was no evidence to suggest that her depression and anxiety caused her to misunderstand the rules concerning the reporting of income - particularly because she reported her income in the ...