210 F.3d 799 (7th Cir. 2000)
Linnie Nelson,    Plaintiff-Appellant,v.Kenneth S. Apfel, Commissioner of  Social Security,    Defendant-Appellee.
No. 99-2390
In the  United States Court of Appeals  For the Seventh Circuit
Argued January 10, 2000Decided April 27, 2000

Appeal from the United States District Court  for the Northern District of Illinois, Eastern Division.  No. 98 C 2223--Paul E. Plunkett, Judge.
Before Flaum, Manion, and Evans, Circuit Judges.
Manion, Circuit Judge.


1
Linnie Nelson applied for  Social Security disability benefits, but an  administrative law judge denied her application,  concluding that she was not disabled. Nelson  appealed to the district court to reverse the ALJ  and instruct it to award her disability benefits.  The Commissioner of Social Security moved for  remand, acknowledging factual conflicts in the  administrative record. The district court granted  the Commissioner's motion and remanded Nelson's  case for a rehearing. Nelson appeals, and we  affirm.

I.

2
Linnie Nelson applied for disability and  Supplemental Security Income benefits, alleging  that she suffers from heart disease, leg pains,  shortness of breath, and depression. The  Commissioner of Social Security denied her  application and she requested a rehearing. At the  time of her administrative hearing on November  11, 1996, Nelson was thirty-seven years old, and  her past employment was semi-skilled, involved  mild or moderate stress, and required light  exertion. Nelson alleged that she was disabled  from full-time work from March 22, 1995 to July  1996, and thus she seeks benefits for that  "closed" period.


3
Three experts testified at Nelson's  administrative hearing. Dr. Abramson, a  cardiologist, testified that Nelson has a stress  limitation, but concluded that her physical  impairments "do not meet or equal in severity any  impairment described as disabling in the Listing  of Impairments." Dr. Johnson, a neurologist and  psychiatrist, testified that Nelson suffers from  no "form of severe nonexertional impairment," and  that her depression is "not severe" because it  does not affect her ability to function on the  job. At the conclusion of Dr. Johnson's  testimony, the ALJ asked him whether he thought  it was necessary to report his findings on a  standard form called the Psychiatric Review  Technique (PRT) form. Dr. Johnson thought that  the form was unnecessary, but agreed to complete  it. On the PRT form, Dr. Johnson checked a box  indicating that Nelson "often" had deficiencies  in "concentration, persistence or pace." He also  checked the box under the heading "Medical  Summary" to conclude that Nelson's impairment was  "Not Severe." Finally, Ms. Bose, a vocational  expert, testified that if Nelson "often"  experienced deficiencies in concentration,  persistence, or pace, she cannot perform  substantial gainful activity.


4
The ALJ accepted the experts' opinions, and  concluded that there is no evidence that Nelson  suffers from "any form of severe impairment." He  also completed a PRT form according to Dr.  Johnson's form, and specifically agreed with Dr.  Johnson that Nelson does not suffer from a severe  mental impairment, and is thus not eligible for  disability benefits. The Commissioner adopted the  ALJ's decision after the Appeals Council denied  Nelson's request for review.


5
Nelson appealed to the district court to reverse  the Commissioner's decision with instructions to  award disability benefits. Nelson sought reversal  solely on her claim of severe depression, and did  not contest the ALJ's conclusion that she has no  severe physical impairments. The Commissioner  filed a motion to remand, arguing that the ALJ  needs to resolve a factual conflict in Dr.  Johnson's testimony. The district court found a  conflict in the record between the testimonies of  Dr. Johnson and Ms. Bose instead, and granted the  motion to remand the case to the ALJ for further  proceedings. Nelson appeals.

II.

6
On appeal, the parties initially dispute the  standard of review. This is an appeal pursuant to  the "judicial review" provision of the Social  Security Act, sentence four of 42 U.S.C. sec.  405(g), which requires us to determine whether  substantial evidence supports the ALJ's decision.  Lauer v. Apfel, 169 F.3d 489, 492 (7th Cir.  1999). Nelson argues that since we have reviewed  appeals under this provision de novo, that  standard applies here. The Commissioner argues,  however, that this case is fundamentally  different because the district court merely  considered whether or not to remand the case to  clarify the record, and did not review the ALJ's  decision for substantial evidence. Therefore, the  Commissioner cites the recent case of Harman v.  Apfel, 203 F.3d 1151 (9th Cir. 2000), to assert  that the abuse of discretion standard applies  here.


7
Since the Social Security Act does not  specifically address the standard of review that  applies in this context, Harman, 203 F.3d at  1154, and it appears to be an issue of first  impression in this circuit, there is no clear  statutory prescription or precedent to guide us  on the appropriate standard of review for this  case. See id. at 1156 n.5. Therefore, we will  determine this issue according to the factors  that the Harman court derived from Pierce v.  Underwood, 487 U.S. 552 (1988), in which the  Court reviewed a determination concerning whether  a party's underlying legal position was  substantially justified to merit an award of  attorney's fees under the Equal Access to Justice  Act (EAJA). After Pierce acknowledged that there  was "neither a clear statutory prescription nor a  historical tradition" to provide the standard of  review in that case, the Court employed  "significant relevant factors" to make that  determination. 487 U.S. at 559. First, the Court  stated that a case that involves "substantial  consequences" should be "reviewed more  intensely." Id. at 563, 108 S.Ct.2541. Here, we agree with  Harman that "the consequences of a remand for  further proceedings are somewhat less substantial  than those flowing from an outright denial of  benefits." Harman, 203 F.3d at 1156. The result  of a remand may actually be an award of benefits,  and, therefore, this factor supports a more  deferential standard. We also find Harman  persuasive that "there are sound practical  reasons" to support the abuse of discretion  standard in this case:


8
The decision whether to remand for further  development of the administrative record or to  direct an immediate award of benefits is a fact-  bound determination that arises in an infinite  variety of contexts. Narrow rules do not serve  well in such a situation; an exercise of  discretion, with review for abuse of discretion,  is far preferable as a means of achieving the  necessary flexibility. See Pierce, 487 U.S. at  562.


9
Harman, 203 F.3d at 1157. Lastly, Harman notes  that the Social Security Act empowers the  district courts to reverse or modify an ALJ's  decision without remanding the case for further  proceedings, and that this suggests that "the  district court's exercise of such authority was  intended to be discretionary and should be  reviewed for abuse of discretion." Id. That is a  reasonable inference, and Harman persuades us  that the applicable standard of review in this  case is abuse of discretion, which means that we  will affirm unless no reasonable person could  agree with the district court. Ladien v.  Astrachan, 128 F.3d 1051, 1056 (7th Cir.  1997).1


10
We must therefore determine whether the district  court abused its discretion when it found that  the testimonies of Dr. Johnson and Ms. Bose  conflict, and thus "support both the conclusion  that Nelson suffers from a severe impairment (and  is therefore disabled) and the conclusion that  she does not." Nelson v. Apfel, No. 98 C 2223,  1999 WL 261740 at *4 (N.D. Ill. April 15, 1999).  Nelson argues that the record does not conflict,  but only supports a finding that she was disabled  for the period in question. According to Nelson,  since the ALJ adopted Dr. Johnson's finding that  she "often" suffered from deficiencies in  concentration, persistence, or pace, and also  adopted Ms. Bose's testimony that such a  functional loss would preclude her from working,  she is thus disabled and entitled to benefits.  Furthermore, Nelson argues that since the ALJ  adopted Dr. Johnson's rating of Nelson's  functional loss, the Social Security regulations  require the ALJ to find that she has a severe  mental impairment. The Commissioner contends,  however, that there are factual conflicts in the  record that the ALJ must resolve on remand.


11
An impairment is severe if it "significantly  limits your physical or mental ability to do  basic work activities," 20 C.F.R. sec.  404.1520(c), and thus an impairment is "not  severe" if "it does not significantly limit your  physical or mental ability to do basic work  activities." 20 C.F.R. sec. 404.1521(a). Here,  Dr. Johnson testified that Nelson's depression is  not severe because it does not affect her ability  to work. But he also rated Nelson's degree of  functional loss as "often" in the area of  concentration, persistence, or pace, which,  according to Ms. Bose, would preclude Nelson from  substantial gainful activity, and thus qualify  her depression as a severe impairment. It is  evident that Dr. Johnson's meaning of "often"  conflicts with that of Ms. Bose, and thus we  conclude that the district court did not abuse  its discretion when it made that determination.


12
Alternatively, Nelson argues that the Social  Security regulations require the ALJ to find that  she has a severe mental impairment according to  Dr. Johnson's rating of her functional loss. To  evaluate the severity of mental impairments, the  regulations require the ALJ to rate the degree of  functional loss resulting from the impairment  according to four areas that are essential to  work. 20 C.F.R. sec. 1520a(b)(3). "For the third  area (concentration, persistence, or pace) the  following five point scale must be used: never,  seldom, often, frequent, and constant." Id. If  there is a rating of "never" or "seldom" in the  third area, "we can generally conclude that the  impairment is not severe, unless the evidence  otherwise indicates there is significant  limitation of your mental ability to do basic  work activities (see sec.404.1521)." 20 C.F.R.  sec. 1520a(c)(1). Nelson argues that these  regulations require the ALJ to find that she has  a severe mental impairment because the degree of  her functional loss is "often," which is more  than "seldom" or "never." But that is not what  the regulations require because they in no way  equate the rating of "often" in the third area  with a severe impairment as defined by a  "significant limit" in one's ability to do basic  work activities. Therefore, we agree with the  district court that Dr. Johnson's rating of  Nelson's functional loss "does not, by itself,  preclude the ultimate finding that Nelson's  depression is not severe within the meaning of  the regulations." Nelson, 1999 WL 261740 at *4.


13
Finally, Nelson contends that Social Security  Ruling 96-3p requires the ALJ to find that her  impairment is severe. Social Security rulings  (SSRs) "are interpretive rules intended to offer  guidance to agency adjudicators. Lauer, 169 F.3d  at 492. "While they do not have the force of law  or properly promulgated notice and comment  regulations, the agency makes SSRs 'binding on  all components of the Social Security Administration.'"  Id.; see 20 C.F.R. sec. 402.35 (b)(1). SSR 96-3p  provides:


14
If the adjudicator finds that such symptoms  [functional loss] cause a limitation or  restriction having more than a minimal effect on  an individual's ability to do basic work  activities, the adjudicator must find that the  impairment(s) is severe and proceed to the next  step in the process even if the objective  evidence would not in itself establish that the  impairment(s) is severe.


15
SSR 96-3p (1999). Nelson claims that this  provision requires the ALJ to find that she has a  severe impairment because her "often"  deficiencies in concentration, persistence, or  pace necessarily have "more than a minimal  effect" on her ability to do basic work  activities. But the ruling does not require the  ALJ to make that finding, nor does it preclude  the ALJ from concluding that Nelson's functional  loss does not affect her ability to work "more  than minimally," and thus that she has no severe  impairment.


16
The bottom line is that we do not know what Dr.  Johnson meant by "often," and we conclude that  the district court did not abuse its discretion  when it remanded this case to the ALJ for further  proceedings to resolve factual conflicts in the  record. See Walker v. Bowen, 834 F.2d 635, 640  (7th Cir. 1987) ("Where conflicting evidence  allows reasonable minds to differ as to whether a  claimant is disabled, the responsibility for that  decision falls on the Secretary (or the  Secretary's designate, the ALJ)."). Accordingly,  we AFFIRM.



Notes:


1
 Nelson argues that the recent case of Williams v.  Apfel, 204 F.3d 48 (2d Cir. 2000), supports her  argument for the de novo standard. But Williams  provides us with no real guidance because it  involved the review of a district court's  decision to reverse and award benefits based on  the pleadings rather than to merely remand to  clarify the record. 204 F.3d at 49.


