On Appeal from the United States District Court for the District of New Jersey
Before: SEITZ, BECKER, Circuit Judges, and ROSENN, Senior Circuit Judge
On April 14, 1984, responding to widespread problems in the administration of the Social Security Disability Program and to the expectation that comprehensive legislative would soon be enacted to alleviate these problems, the Secretary Health and Human Services (the "Secretary") decided to suspend periodic review of disability determinations. The periodic review program had been instituted in 1980 to enable the Secretary to terminate the disability benefits of persons who, upon reevaluation, were found to be capable of engaging in substantial gainful employment. As part of the decision to suspend periodic review, the Secretary restored cases had not received final administrative decisions. The Secretary did not, however, restore benefits to individuals whose benefits had been terminated pursuant to the review procedure and whose appeals were pending in the federal courts.*fn1
The plaintiffs, persons in this latter group, brought suit in the district court for the District of New Jersey seeking injunctive relief on behalf of all similarly situated individuals, and challenging on equal protection grounds the Secretary's decision to distinguish between disability review cases on the basis of whether the claimants had received final administrative determinations. On July 12, 1984, finding that the requirements of Fed.R.Civ.P. 23(b)(2) were met, the district court certified a nationwide class comprising all individuals with appeals from adverse periodic review disability determinations pending in the federal district courts. The district court also decided that, because the distinction relied on by the Secretary was "chimerical," her decision did not meet the (applicable) rational relation test and was unconstitutional. Accordingly, the district court granted a preliminary injunction requiring the Secretary to restore benefits to the class.
Concluding that the district court erred in declaring the Secretary's decision unconstitutional, we now vacate its order granting a preliminary injunction. Although the court's class certification does not give rise to an appealable order, we remand so that the district court may decide whether to vacate the class certification in light of our decision on the merits.
I. FACTS AND PROCEDURAL HISTORY
A. The Periodic Review Process
In 1980, Congress amended the Social Security Act to require review of the eligibility of each disability beneficiary at least once every three years.*fn2 Implementation of this rather straightforward mandate has, however, been controversial. Central to the controversy has been the lack of a national standard for reviewing cases to determine whether continued disability benefits are warranted. Initially, the Secretary adopted a standard of review that required termination of benefits when the current evidence of record supported a finding that the person was able to engage in substantial gainful activity. See 45 Fed. Reg. 55,566, 55,568 (Aug. 20, 1980). This standard was challenged in court, however, and several courts of appeals concluded that the Secretary's standard was improper, although these courts disagreed among themselves as to the appropriate standard of review.*fn3 As a result, several standards of review have been applied to disability redeterminations, so that a person's eligibility has depended as much on one's state of residence as on one's condition of disability.
Responding to these "significant problems and dislocations," and "reaffirming [a] commitment to and insistence upon a nationally uniform disability insurance program," S. Rep. No. 98-466, 98th Cong., 2d Sess. 6, 9 (1984), the 98th Congress, true to the Secretary's expectations, enacted legislation establishing a uniform standard for disability reviews.*fn4 This legislation was signed into law by the President on October 9, 1984. Although the enacted statute provides the named plaintiffs and class members with some of the relief that they would otherwise receive as a result of the district court's injunction in this case, it does not moot this appeal.*fn5 We therefore turn to the Secretary's April 1984 decision.
After considering the substantial problems inherent in administering a national disability program with widely varying eligibility standards and the apparently imminent enactment of a comprehensive disability standard,*fn6 the Secretary announced that the Social Security Administration (SSA) would suspend the disability review process until the legislation was enacted and implemented. See Appendix at 4. The Secretary also directed the SSA to restore current and retroactive benefits to all individuals with claims pending at the administrative level. See id. On May 22, 1984, a Ruling was issued by the Acting Commissioner of SSA to implement the Secretary's announcement. The Acting Commissioner specified that "determinations and decisions of disability cessation for medical reasons" would be rescinded for:
individuals who have not received an Appeals Council decision or notice denying a request for review by the Appeals Council of the administrative law judge decision on their periodic review claims and who have such claims properly pending in the Department. People who, as of the effective date of this policy, still have time to appeal the determination to stop their benefits to the next administrative review level also will have their [disability] determinations rescinded."
The Ruling did not rescind adverse decisions and restore benefits for
individuals who received an Appeals Council decision or notice denying review and those whose claims were not properly pending administratively . . . as of [April 13, 1984]. . . . Similarly, cases pending in the Federal courts for review of a final agency decision . . . are not subject to the Secretary's ...