           IN THE UNITED STATES COURT OF APPEALS
                    FOR THE FIFTH CIRCUIT United States Court of Appeals
                                                   Fifth Circuit

                                                                            FILED
                                                                          March 28, 2008

                                     No. 07-51266                     Charles R. Fulbruge III
                                   Summary Calendar                           Clerk


IRMA A SALGADO

                                                  Plaintiff-Appellant
v.

MICHAEL J. ASTRUE, COMMISSIONER OF SOCIAL SECURITY

                                                  Defendant-Appellee



                   Appeal from the United States District Court
                        for the Western District of Texas
                              USDC No. 7:06-CV-98


Before HIGGINBOTHAM, STEWART, and OWEN, Circuit Judges.
PER CURIAM:*
       Irma Salgado applied to the Social Security Administration for disability
insurance. An administrative law judge found that she did not have a severe
impairment. An Appeals Council found a severe impairment but determined
that she had residual functional capacity to perform her former relevant work
as a worker at a fast food restaurant. The district court affirmed. We also
affirm.


       *
         Pursuant to 5TH CIR. R. 47.5, the court has determined that this opinion should not
be published and is not precedent except under the limited circumstances set forth in 5TH CIR.
R. 47.5.4.
                                 No. 07-51266


                                        I
      Salgado stopped working in 2001 and filed an application with the Social
Security Administration for Disability Insurance Benefits under Title II of the
Social Security Act in 2002. She had previously worked as a dish washer, a
certified nurse’s aid, and a short order cook/counter attendant.         In her
application and testimony, she stated that she had pain in her feet, hands, and
neck and was unable to be on her feet or to sit down for long periods of time.
Although she could do some cleaning and cooking in her home, she claimed that
she had to frequently lie down because of the pain.        Her medical record
contained evidence from two examinations by agency medical consultants. Dr.
Raj Pandya reported that Salgado had complained of arthritic pain throughout
her body and particularly in her ankles and neck and told him that she could not
sit, stand, or walk for long periods, that her ankles swelled, and that she often
had to lie down. Dr. Pandya reported no findings of a severe disease and did not
find any physical evidence supporting the arthritic pain described by Salgado.
He diagnosed her with osteoarthritis. An x-ray ordered by the doctor showed
degenerative disc and facet disease. Dr. Thwe Htay, the second examining
consultant, reported that Salgado made similar complaints to him of constant
pain in the feet and ankles, swelling, and the inability to lift more than ten
pounds or stand for long periods. He reported that the medical evidence did not
fully support Salgado’s claimed arthritic symptoms, but he found some
tenderness in the hands and some swelling in the ankles; he diagnosed Salgado
with bilateral hand pain, ankle pain, and foot pain.
      Three medical consultants also examined Salgado’s functional capacity.
The first found that she could “[s]tand and/or walk (with normal breaks) for a
total of” “about 6 hours in an 8-hour workday” and found no postural,
manipulative, visual, communicative, or environmental limitations. A secondary


                                       2
                                        No. 07-51266

diagnosis, as well as a third full diagnosis, also found that she could stand, walk,
or sit for six hours out of the work day and found no postural, manipulative,
visual, communicative, or environmental limitations.
      The Social Security Act provides insurance benefits for certain disabled
individuals. An individual is disabled under the Act if she is unable
      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 which has lasted or can be expected
      to last for a continuous period of not less than 12 months.1

To determine whether an individual is disabled, the Social Security
Administration follows a “five-step sequential evaluation process,”2 which we
have described as follows:
      1. An individual who is working and engaging in substantial gainful
      activity will not be found disabled regardless of the medical
      findings.

      2. An individual who does not have a “severe impairment” will not
      be found to be disabled.

      3. An individual who meets or equals a listed impairment in
      Appendix 1 of the regulations will be considered disabled without
      consideration of vocational factors.

      4. If an individual is capable of performing the work he has done in
      the past [i.e., has “residual functional capacity], a finding of “not
      disabled” must be made.

      5. If an individual’s impairment precludes him from performing his
      past work, other factors including age, education, past work




      1
          42 U.S.C. § 423(d)(1)(A).
      2
          20 C.F.R. § 404.1520(a)(4).

                                             3
                                  No. 07-51266

      experience, and residual functional capacity must be considered to
      determine if other work can be performed.3

As part of this five-step process, adjudicators consider both objective evidence
from medical reports and subjective evidence, such as an applicant’s claims
regarding symptoms and pain. An adjudicator is required to follow what we will
call, for the purposes of this case, an “objective-subjective” two-step process in
evaluating an applicant’s subjective evidence and the applicant’s credibility, if
a credibility determination is necessary. Under this two-step process to evaluate
an applicant’s subjective claims, the adjudicator must first determine whether
there is an impairment that reasonably produced the symptoms complained of.
If the adjudicator finds no impairment, the individual is not disabled. If an
impairment is identified, the adjudicator then considers the applicant’s
statements about symptoms and the remaining evidence in the record to
determine the strength of the symptoms and how the symptoms affect the
applicant’s ability to do basic work. The adjudicator also determines the
credibility of the applicant’s claims about symptoms. The two-step process is
outlined in Social Security Ruling (SSR) 96-7p:
       1. [Objective] No symptom or combination of symptoms can be the
      basis for a finding of disability, no matter how genuine the
      individual’s complaints may appear to be, unless there are medical
      signs and laboratory findings demonstrating the existence of a
      medically determinable physical or mental impairment(s) that could
      reasonably be expected to produce the symptoms.

      2. [Subjective] When the existence of a medically determinable
      physical or mental impairment(s) that could reasonably be expected
      to produce the symptoms has been established, the intensity,
      persistence, and functionally limiting effects of the symptoms must
      be evaluated to determine the extent to which the symptoms affect
      the individual's ability to do basic work activities. This requires the

      3
         Harrell v. Bowen, 862 F.2d 471 (5th Cir. 1988) (paraphrasing 20 C.F.R. §
404.1520(b)-(f)).

                                        4
                                     No. 07-51266

      adjudicator to make a finding about the credibility of the
      individual's statements about the symptom(s) and its functional
      effects.4

      The ALJ held a hearing in 2005.            Under this two-step process, he
concluded at the first step that there was no “objective evidence of any
impairment that could have reasonably been expected to substantially interfere
with the claimant’s ability to engage in basic work activities” and that “the
medical record fails to demonstrate a severe mental impairment that has lasted
for 12-months.” The ALJ, in making this determination, also discussed evidence
that applied to the second step of the analysis, such as Salgado’s ability to lift
objects, stand up for limited periods of time, and cook and clean.
      Salgado appealed, and the Appeals Council reached a different conclusion,
finding that Salgado did have a severe impairment. At the fourth step of the
five-step inquiry for disability, however, it concluded, adopting the ALJ’s
findings that were pertinent to the second step of the objective-subjective
analysis, that despite her impairment, Salgado had residual functional capacity
that allowed her to do her past work as a fast food cook and cashier. It
concluded that Salgado “was not under a disability as defined in [the] Social
Security Act, at any time through the date of the decision.”
      Salgado appealed to the district court, arguing that the Appeals Council
had not used the proper legal standards in evaluating her subjective symptoms
and credibility; that it had not made necessary findings regarding her credibility;
and that the Council failed to consider all relevant evidence when determining
that she had residual functional capacity that allowed her to work. The district
court affirmed. She raises similar arguments in her appellate brief. Specifically,
she argues that the Appeals Council did not follow the proper legal standards in



      4
          1996 WL 374186 at *1 (July 2, 1996).

                                            5
                                      No. 07-51266

evaluating her subjective symptoms under SSR 96-7p (“Evaluation of Symptoms
in Disability Claims”) and 20 C.F.R. §404.1529 (“How we [the Social Security
Administration] evaluate symptoms, including pain.”); did not make the
necessary credibility choices regarding Salgado’s testimony on symptoms and
other indicators of disability; and did not consider the entire record in
determining her residual functional capacity. We address each of these in turn.
                                            II
      In a disability case, “[t]he function of a reviewing court is to determine
whether the. . . [agency’s] findings are supported by substantial evidence in the
record as a whole and to determine the reasonableness of the decision reached.”5
Salgado argues that the Appeals Council did not follow proper legal procedure
in evaluating her subjective symptoms under SSR 96-7p and 20 C.F.R.
§404.1529.      Under the objective-subjective two-step analysis for disability
symptoms, the ALJ found no impairment at step 1. The Appeals Council
answered “yes” to step one, finding that there was an objective impairment, but
then, instead of independently evaluating her symptoms to determine her ability
to do work activities, it relied on the ALJ record for step 2 evidence for the work
activity analysis. Based on this ALJ-derived step 2 analysis, the Appeals
Council found that Salgado had residual functional capacity and could work
despite her impairment.
      Both SSR 96-7p and 20 C.F.R. §404.1529 emphasize that subjective
symptoms alone, absent some indication that they are supported by objective
medical evidence, fail to support a disability finding. 20 C.F.R. § 404.1529
states,
      Your symptoms, such as pain, fatigue, shortness of breath,
      weakness, or nervousness, will not be found to affect your ability to



      5
          Scharlow v. Schweiker, 655 F.2d 645, 648 (1981).

                                             6
                                       No. 07-51266

      do basic work activities unless medical signs or laboratory findings
      show that a medically determinable impairment(s) is present. . . .

      Since symptoms sometimes suggest a greater severity of
      impairment than can be shown by objective medical evidence alone,
      we will carefully consider any other information you may submit
      about your symptoms. . . . Because symptoms, such as pain, are
      subjective and difficult to quantify, any symptom-related functional
      limitations and restrictions which you, your treating or nontreating
      source, or other persons report, which can reasonably be accepted as
      consistent with the objective medical evidence and other evidence,
      will be taken into account as explained in paragraph (c)(4) of this
      section in reaching a conclusion as to whether you are disabled.6

Similarly, SSR 96-7p states,

      No symptom or combination of symptoms can be the basis for a
      finding of disability, no matter how genuine the individual's
      complaints may appear to be, unless there are medical signs and
      laboratory findings demonstrating the existence of a medically
      determinable physical or mental impairment(s) that could
      reasonably be expected to produce the symptoms.7

      The Appeals Council found a severe impairment and was required under
Ruling 96-7p to then evaluate “the intensity, persistence, and functionally
limiting effects of the symptoms . . . to determine the extent to which the
symptoms affect the individual’s ability to do basic work activities.” To do so, the
Appeals Council “considered the claimant’s statements concerning the subjective
complaints (Social Security Ruling 96-7p) and adopt[ed] the Administrative Law
Judge’s conclusions in this regard.”
          As the Commissioner argues, “the ALJ evaluated the intensity,
persistence, and limiting effects of Plaintiff’s symptoms and determined that
there was no objective evidence that any impairment could substantially

      6
          20 C.F.R. § 404.1529 (b), (c)(3) (emphasis added).
      7
          SSR 96-7P, 1996 WL 374186 at *1 (emphasis added).

                                              7
                                       No. 07-51266

interfere with her ability to engage in basic work activities.” We are not
persuaded by Salgado’s argument that the ALJ’s subjective analysis was
erroneous in its reliance upon objective evidence. Although in Scharlow v.
Schweiker we held that “[i]t is well established in the Fifth Circuit that pain
alone can be disabling, even when its existence is unsupported by objective
medical evidence if linked to a medically determinable impairment,”8 this case
does not stand for the proposition that pain must be considered independently
of the objective evidence.        Rather, we concluded, “Since pain alone or in
conjunction with other impairments can give rise to a disability . . . the ALJ
must consider subjective evidence of pain as testified to by the claimant; failure
to give consideration to the subjective evidence of pain and disability as testified
to by the plaintiff is reversible error.”9
      The ALJ considered this objective evidence, stating, for example,
      She said that she cannot do any of her past relevant work since she
      could not [sic] longer do the heavy lifting because her hands throb
      all the time. She also asserted that she cannot be on her feet due to
      pain in her feet. She asserted that she is able to do cleaning around
      the house, but does a little and then lies down. She reported that
      she has problems sleeping at night . . . . She reported that she has
      swelling in her hands, knees, and feet. She said that she also has
      arthritis in her neck. She admitted that she has problems with her
      grip and she has problems dropping things in her hands. She
      reported that she has pain all over her body and she takes pain
      medications.

The ALJ also looked to the medical consultant’s reports, which indicated that
Salgado
      reported that her hand pain and wrist pain are worse by lifting
      heavy objects or doing any work with her hands. She said that she
      can lift up to 10 pounds, but sometimes she drops even a cup of

      8
          655 F.2d 645, 648 (5th Cir. 1981).
      9
          Id. (emphasis added).

                                               8
                                        No. 07-51266

       water, if she has pain in her hand. She reported that her daughter-
       in-law helps with the cleaning of the house, but she is able to do the
       cooking . . . She reported that she can stand up to 30 minutes and
       walk up to two blocks.

The Appeal Council’s adoption of the ALJ’s subjective findings, which included
the requisite subjective findings on intensity, persistence, and so on, and the
Council’s corresponding failure to perform an independent subjective analysis
for step 2 of the objective-subjective test, was not legal error.10
                                              III
       Salgado argues that the Council made two errors with respect to
credibility. First, she alleges, the Council made a procedural legal error by
failing to
       make any credibility finding based on the record as a whole, or
       make any type of statement that he either believed or disbelieved
       Salgado’s testimony and reports. Instead, he simply found a
       complete absence of objective support for Salgado’s statements as to
       her symptom-related limitations. That does not represent the type
       of credibility finding required by SSR 96-7p.

She also alleges that the Council erred in failing to make independent credibility
findings. SSR 96-7p requires,
       In recognition of the fact that an individual’s symptoms can
       sometimes suggest a greater level of severity of impairment than
       can be shown by the objective medical evidence alone, 20 CFR
       404.1529(c) and 416.929(c) describe the kinds of evidence, including
       the factors below, that the adjudicator must consider in addition to


       10
         Salgado argues that the Appeals Council should have done its own RFC assessment
under 20 C.F.R. § 404.1545 and 20 C.F.R. § 404.1529(c), as well as SSR 96-7p. These
regulations require consideration of factors, such as “any statements about what . . . [the
applicant] can still do that have been provided by medical sources” (20 C.F.R. § 404.1545 (a)(3))
and “history, the signs and laboratory findings, and statements . . . about how . . . [the
applicant’s] symptoms affect . . . [the applicant]” (20 CFR § 404.1529(c)). As we have discussed,
these factors were included in the ALJ decision and thus did not require an independent
analysis by the Council.

                                               9
                                       No. 07-51266

      the objective medical evidence when assessing the credibility of an
      individual’s statements:

           1. The individual’s daily activities;
           2. The location, duration, frequency, and intensity of the
           individual’s pain or other symptoms;
           3. Factors that precipitate and aggravate the symptoms;
           4. The type, dosage, effectiveness, and side effects of any
           medication the individual takes or has taken to alleviate pain
           or other symptoms;
           5. Treatment, other than medication, the individual receives
           or has received for relief of pain or other symptoms;
           6. Any measures other than treatment the individual uses or
           has used to relieve pain or other symptoms (e.g., lying flat on
           his or her back, standing for 15 to 20 minutes every hour, or
           sleeping on a board); and
           7. Any other factors concerning the individual’s functional
           limitations and restrictions due to pain or other symptoms.11

SSR 96-7p also requires that “[t]he determination or decision must contain
specific reasons for the finding on credibility, supported by the evidence in the
case record.”12 In Scharlow we similarly held,
      Failure to indicate the credibility choices made and the basis for
      those choices in resolving the crucial subsidiary fact of the
      truthfulness of subjective symptoms and complaints requires
      reversal and remand.13

      The ALJ’s decision makes it clear that the ALJ took into account Salgado’s
testimony regarding her symptoms and pain in considering the weight of her
subjective claims.       The ALJ discussed the kind of evidence required for
credibility decisions under SSR 96-7p, evaluating Salgado’s daily activities, such
as cooking, cleaning, and laundry; the location of her pain in her hands, wrists,

      11
           1996 WL 374186 at *3.
      12
           Id. at *2.
      13
           655 F.2d at 649 (citing Hayes v. Celebrezze, 311 F.2d 648, 653-54 (5th Cir. 1963)).

                                              10
                                  No. 07-51266

feet, ankles, and neck as well as “all over”; the types of medication that she took
and the periods of time during which she took it; and other alleviating measures
such as lying down when she was in too much pain to continue cooking or
cleaning. In so doing, the ALJ, as required by SSR 96-7p, provided credibility
reasons and findings that were “sufficiently specific to make clear to the
individual and to any subsequent reviewers the weight the adjudicator gave to
the individual’s statements and the reasons for that weight.”
      Salgado argues that the ALJ’s credibility findings were improper because
of our holding in Scharlow that “pain alone can be disabling, even when its
existence is unsupported by objective medical evidence if linked to a medically
determinable impairment.”14 Credibility decisions, she argues, cannot be based
solely on whether the objective evidence supports an applicant’s subjective
complaints of pain.
      Although the ALJ’s central reason for giving Salgado’s subjective evidence
less weight than the medical evidence was the failure of her symptoms to match
the objective medical evidence, he also considered Salgado’s reports to
consultants and her testimony regarding her ability to perform various tasks.
He discussed, for example, her descriptions to medical consultants, wherein
      She reported that she can handle objects. She reported that she can
      do daily activities of daily living by herself. . . . She reported that
      she has pain daily and all the time and lies down in bed a lot of
      time. However, she reported that she can do cleaning, laundry, and
      cooking, but she cannot do activities for a long time.

He also found, “The claimant testified at the hearing that she completed the
eleventh grade . . . but she was shy of three months from graduating high school.
However, she testified that she cannot read or write in English and asserted that
she did not make good grades, but she was promoted by her teachers.” Although


      14
           Id. at 648.

                                        11
                                   No. 07-51266

the ALJ did not then indicate that he disbelieved Salgado’s testimony because
of inconsistencies that he identified, his statements provide sufficiently “specific
reasons for the finding on credibility.”15
      Finally, Salgado argues that the Appeals Council erred in failing to make
its own findings as to credibility. Because the ALJ did not reach the second step
of the analysis after finding that Salgado was not impaired, she alleges, adoption
of the ALJ’s subjective analysis by the Appeals Council was improper. SSR 96-
7p requires,
      whenever the individual’s statements about the intensity,
      persistence, or functionally limiting effects of pain or other
      symptoms are not substantiated by objective medical evidence, the
      adjudicator must make a finding on the credibility of the
      individual’s statements based on a consideration of the entire case
      record. This includes the medical signs and laboratory findings, the
      individual's own statements about the symptoms, any statements
      and other information provided by treating or examining physicians
      or psychologists and other persons about the symptoms and how
      they affect the individual, and any other relevant evidence in the
      case record. . . . an individual’s symptoms, including pain, will be
      determined to diminish the individual's capacity for basic work
      activities to the extent that the individual’s alleged functional
      limitations and restrictions due to symptoms can reasonably be
      accepted as consistent with the objective medical evidence and other
      evidence in the case record.16

The ALJ’s credibility determinations were sufficient for the Appeals Council’s
finding on Salgado’s residual functioning. The ALJ considered and discussed the
entire record, including laboratory findings such as Salgado’s blood tests,
Salgado’s statements as to her pain and the activities that she was able or
unable to do, her reports of symptoms to medical consultants, and medical
consultants’ conclusions.

      15
           1996 WL 374186 at *2.
      16
           Id.

                                        12
                                 No. 07-51266

                                      IV
      By adopting the ALJ’s findings with respect to Salgado’s daily activities,
treatment, alternatives to treatment, and her difficulties in doing various
activities, the Appeals Council properly considered the entire record, both with
respect to credibility and with respect to the strength of Salgado’s subjective
symptoms. We are not persuaded that the Council failed to base its residual
function capacity assessment on the entire record.
      AFFIRMED.




                                      13
