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Proposed Rule

VA Compensation and Pension Regulation Rewrite Project

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AGENCY:

Department of Veterans Affairs.

ACTION:

Proposed rule.

SUMMARY:

The Department of Veterans Affairs (VA) proposes to reorganize and rewrite its compensation and pension regulations in a logical, claimant-focused, and user-friendly format. The intended effect of the proposed revisions is to assist claimants, beneficiaries, veterans' representatives, and VA personnel in locating and understanding these regulations.

DATES:

Comments must be received by VA on or before March 27, 2014.

ADDRESSES:

Written comments may be submitted through http://www.regulations.gov; by mail or hand-delivery to: Director, Regulations Management (02REG), Department of Veterans Affairs, 810 Vermont Ave. NW., Room 1068, Washington, DC 20420; or by fax to (202) 273-9026. Comments should indicate that they are submitted in response to RIN 2900-AO13. Copies of comments received will be available for public inspection in the Office of Regulation Policy and Management, Room 1063B, between the hours of 8:00 a.m. and 4:30 p.m., Monday through Friday (except holidays). Please call (202) 461-4902 for an appointment (this is not a toll-free number). In addition, during the comment period, comments may be viewed online through the Federal Docket Management System at http://www.regulations.gov.

Start Further Info

FOR FURTHER INFORMATION CONTACT:

William F. Russo, Deputy Director, Office of Regulations Policy & Management (02REG), Office of the General Counsel, Department of Veterans Affairs, 810 Vermont Ave. NW., Washington, DC 20420, (202) 461-4902 (this is not a toll-free number).

End Further Info End Preamble Start Supplemental Information

SUPPLEMENTARY INFORMATION:

Introduction

The VA Office of the General Counsel provides centralized management and coordination of VA's rulemaking process through its Office of Regulation Policy and Management (ORPM). One of ORPM's major functions is to oversee VA's Regulation Rewrite Project (the Project) to improve the organization and clarity of VA's adjudication regulations, which are in current 38 CFR part 3. These regulations govern the adjudication of claims for VA's monetary benefits (compensation, pension, dependency and indemnity compensation, and burial benefits), which are administered by the Veterans Benefits Administration (VBA).

The Project responds to a recommendation made by the VA Claims Processing Task Force in its October 2001 “Report to the Secretary of Veterans Affairs” and to criticisms by the U.S. Court of Appeals for Veterans Claims. The Task Force recommended that VA reorganize its regulations in a logical, coherent manner. The Court referred to the current regulations as a “confusing tapestry” and criticized VA for maintaining substantive rules in its Adjudication Procedures Manual (manual). Accordingly, the Project reviewed the manual to identify provisions that might be substantive and incorporated those provisions in a complete rewrite of part 3. VA published the rewritten material in 20 Notices of Proposed Rulemaking (NPRMs) and gave interested persons 60 days to submit comments after each publication. These NPRMs addressed specific topics, programs, or groups of regulatory material organized under the following Rulemaking Identifier Numbers (RIN):

  • RIN 2900-AL67, Service Requirements for Veterans (January 30, 2004)
  • RIN 2900-AL70, Presumptions of Service Connection for Certain Disabilities, and Related Matters (July 27, 2004)
  • RIN 2900-AL71, Accrued Benefits, Death Compensation, and Special Rules Applicable Upon Death of a Beneficiary (October 1, 2004)
  • RIN 2900-AL72, Burial Benefits (April 8, 2008)
  • RIN 2900-AL74, Apportionments to Dependents and Payments to Fiduciaries and Incarcerated Beneficiaries (January 14, 2011)
  • RIN 2900-AL76, Benefits for Certain Filipino Veterans and Survivors (June 30, 2006)
  • RIN 2900-AL82, Rights and Responsibilities of Claimants and Beneficiaries (May 10, 2005)
  • RIN 2900-AL83, Elections of Improved Pension; Old-Law and Section 306 Pension (December 27, 2004)
  • RIN 2900-AL84, Special and Ancillary Benefits for Veterans, Dependents, and Survivors (March 9, 2007)
  • RIN 2900-AL87, General Provisions (March 31, 2006)
  • RIN 2900-AL88, Special Ratings (October 17, 2008)
  • RIN 2900-AL89, Dependency and Indemnity Compensation Benefits (October 21, 2005)
  • RIN 2900-AL94, Dependents and Survivors (September 20, 2006)
  • RIN 2900-AL95, Payments to Beneficiaries Who Are Eligible for More than One Benefit (October 2, 2007)
  • RIN 2900-AM01, General Evidence Requirements, Effective Dates, Revision of Decisions, and Protection of Existing Ratings (May 22, 2007)
  • RIN 2900-AM04, Improved Pension (September 26, 2007)
  • RIN 2900-AM05, Matters Affecting the Receipt of Benefits (May 31, 2006)
  • RIN 2900-AM06, Payments and Adjustments to Payments (October 31, 2008)
  • RIN 2900-AM07, Service-Connected Disability Compensation (September 1, 2010)
  • RIN 2900-AM16, VA Benefit Claims (April 14, 2008)

VA received numerous comments to the 20 NPRMs. These came from private individuals and several Veterans Service Organizations. VA thanks the commenters for the time they invested and the contribution they have made to the quality of the proposed regulations in this document.

VA also wishes to thank its employees, past and present, for their hard work and dedication in drafting these regulations. We are especially grateful for the contributions of the late Richard Hirst and Robert M. White, who dedicated their lives to our nation's disabled veterans.

In several of the prior NPRMs, we proposed to amend certain provisions or portions of provisions in 38 CFR part 3. Upon further consideration, if VA implemented the Project as a new 38 CFR part 5, it would not amend any part 3 provisions in conjunction with publishing part 5. Instead, it would remove part 3 in its entirety when it is no longer applicable to the adjudication of benefit claims and would provide public notice before doing so.

As stated in the prior NPRMs, we would incorporate numerous statutory amendments, VA General Counsel Opinions, court decisions, and VA manual provisions in the rewritten regulations. To the extent that any manual provision would be inconsistent with a rewritten regulation, the regulation would be binding on VA and the public. Any implementation of the rewritten regulations, whether implemented as proposed in this NPRM or in some other manner, would require a corresponding rewrite of VA's adjudication procedures manual.Start Printed Page 71043

VA does not intend to publish a final rule in this rulemaking proceeding in the near future. In the first quarter of fiscal year 2012, VBA formulated a Transformation Plan to improve the delivery of benefits to veterans and their dependents and survivors. In the first phase of this plan, VBA's transformational people, processes, and technology initiatives are designed to achieve VA's priority goals of processing all disability claims within 125 days and increasing rating quality to 98 percent by the end of 2015. Upon achieving those goals, the plan calls for VBA to allocate resources to maintain high-quality service for compensation claims while redirecting resources to the second phase of the transformation, which will address the needs of VBA's other benefit programs (appeals, veterans and survivors pension, dependency and indemnity compensation, burial benefits, vocational rehabilitation, education, and fiduciary). To ensure that VBA successfully implements this plan and accomplishes the Department's priority goals of eliminating the disability claims backlog and improving veterans' and survivors' access to benefits and services, VA may not publish a final-rule notice in this rulemaking until VBA's Transformation implementation is complete.

In the interim, VA will continue to amend its adjudication regulations in 38 CFR part 3 to implement changes in law and the policies and procedures that it needs to properly administer its benefit programs. In amending part 3, VA may refer to the work done by the Project and may incorporate that work in whole or in part depending upon the nature of the amendments. In this way, regardless of any future decision about implementation of the Project's rewritten regulations, VA will update its regulations at the same time that VBA is improving the delivery of benefits to veterans and survivors under the Transformation Plan.

Request for Public Comments

In this NPRM, we have merged the Rulemaking Identifier Numbers (RINs) of the 20 prior NPRMs into the RIN for this NPRM, AO13. The preamble to this NPRM addresses the public comments that VA received in response to those NPRMs and explains the changes we have made to the initially proposed rules.

Although VA does not intend to complete this rulemaking in the near future, we request public comments on the consolidation of the prior proposed rules, which would be implemented in a new 38 CFR part 5, and on the changes made to those proposed rules. Prior to publishing a final rule in this rulemaking, VA will consider any comments that it receives in response to this NPRM and will evaluate the feasibility of a one-time implementation of new part 5 as proposed. If VA determines that such an implementation is feasible, we may need to publish additional rulemakings to adapt to implementation plans and keep these proposed rules up to date.

Substantive v. Non-substantive Changes

In the NPRMs we stated:

[a]lthough these regulations have been substantially restructured and rewritten for greater clarity and ease of use, most of the basic concepts contained in these proposed regulations are the same as in their existing counterparts in 38 CFR part 3. However, a few substantive differences are proposed . . . .

. . . .

Readers who . . . observe substantive changes between [existing regulatory provisions and proposed provisions] should consult the text that appears later in this document for an explanation of significant changes in each regulation.

In the NPRMs we sometimes referred to specific proposed changes from part 3 as “substantive” or “not substantive.” Sometimes we said “we intend no substantive change.” Our intent was to clarify for readers whether we were making a policy change (“substantive”) or merely restating existing VA policy more clearly (“non-substantive”), in those instances where we thought a reader might need that guidance. Most often, however, we applied neither label to our changes; instead we simply told the reader how we were proposing to change a regulation provision and why.

However, the case of Roberts v. Shinseki, 23 Vet. App. 416 (2010), aff'd on other grounds, 647 F.3d 1334 (Fed. Cir. 2011), the U.S. Court of Appeals for Veterans Claims (CAVC) showed how such labels can be misleading. In Roberts, the CAVC affirmed VA's severance of fraudulent service connection. The Secretary argued severance for fraud is subject to the due process required in 38 CFR 3.103(b) (concerning adverse decisions) and exempt from the requirements of § 3.105(d) (concerning severance of service connection). The CAVC also held that the reference to compliance with § 3.105(d) in the regulation on protection of service-connected status § 3.957 does not apply in cases of fraud. In holding that § 3.105(d) does not apply to severance of service connection based fraud, the CAVC explicitly rejected appellant's §§ 3.105(a) and 3.957 arguments that severance for fraud requires proof that the grant was based on clear and unmistakable error (CUE).

The Roberts dissent quoted at length from NPRM AM 01, 72 FR 28770, May 22, 2007, to rebut the Secretary's assertion that his argument correctly stated VA interpretation of §§ 3.105(d) and 3.957 in light of regulatory history and in the absence of historical information that VA ever implemented the regulations differently. The dissent first noted that in rewriting §§ 3.957 and 3.105(d), “VA intends to `clarify' and recodify 38 CFR 3.957 and the provisions of 38 CFR 3.105(d) that govern when service connection may be severed at 38 CFR 5.175, entitled `Protection or severance of service connection.' ” Id. at 436. The dissent also noted that our proposed regulations did not except severance of service connection based on fraud from the due process or burden of proof elements of §§ 3.957 or 3.105(d). Finally, the dissent noted that the NPRM stated that it explained any substantive changes between part 3 and part 5, 72 FR 28771-27772, May 22, 2007, and that there was nothing in the NPRM “indicating that the rewriting and restructuring of the regulations [pertaining to severance of service connection for fraud] are intended as substantive changes.” Id. at 437-39. From these observations, the dissent reasoned, the NPRM revealed VA's interpretation of §§ 3.957 and 3.105(d) as requiring application of both the process and burden of proof provisions of § 3.105(d) before severing service connection.

This dissent illustrates the need to revise the way we use labels describing differences between part 5 regulations and the part 3 regulations from which they derive. In addition to the confusion highlighted by the Roberts case, we believe that readers may incorrectly read our substantive or non-substantive labels as referring to the distinction that the Administrative Procedures Act (specifically 5 U.S.C. 553) makes between substantive rules and interpretive or procedural rules. See Cmty. Nutrition Inst. v. Young, 818 F.2d 943 (D.C. Cir. 1987); Vermont Yankee Nuclear Power Corp. v. Natural Resources Defense Council, 435 U.S. 519 (1978); Am. Hosp. Ass'n v. Bowen, 834 F.2d 1037, 1045 (D.C. Cir. 1987).

To avoid potential confusion, we now advise readers to draw no inferences from the use of, or non-use of, the labels substantive or non-substantive in the NPRMs. Instead, readers should simply rely on our actual description of the change and our reasons for making the change. The only instances where we use “substantive” in this preamble are where we used the term to refute a Start Printed Page 71044comment asserting that we are diminishing rights or benefits and when used to distinguish a “substantive” provision from a “procedural” one.

II. Overview of New Part 5 Organization

We plan to organize the new part 5 regulations so that most provisions governing a specific benefit are located in the same subpart, with general provisions pertaining to all compensation and pension benefits grouped together. This organization will allow claimants, beneficiaries, and their representatives, as well as VA adjudicators, to find information relating to a specific benefit more quickly than the organization provided in current part 3.

The first major subdivision would be “Subpart A: General Provisions”. It would include information regarding the scope of the regulations in new part 5, general definitions, and general policy provisions for this part. We published this subpart as a Notice of Proposed Rulemaking (NPRM) on Mar. 31, 2006. See 71 FR 16464.

“Subpart B: Service Requirements for Veterans” would include information regarding a veteran's military service, including the minimum service requirement, types of service, periods of war, and service evidence requirements. We published this subpart as an NPRM on Jan. 30, 2004. See 69 FR 4820

“Subpart C: Adjudicative Process, General” would inform readers about claim filing and benefit application procedures, VA's duties, claimants' and beneficiaries' rights and responsibilities, general evidence requirements, and general effective dates of new awards, and about revision of decisions and protection of VA ratings. We published this subpart as three separate NPRMs due to its size. We published the first, concerning the duties of VA and the rights and responsibilities of claimants and beneficiaries, on May 10, 2005. See 70 FR 24680. We published the second, concerning general evidence requirements, effective dates, revision of decisions, and protection of existing ratings, on May 22, 2007. See 72 FR 28770. We published the third, concerning rules on filing benefits claims, on April 14, 2008. See 73 FR 20136.

“Subpart D: Dependents and Survivors” would inform readers how VA determines whether a person is a dependent or a survivor for purposes of determining eligibility for benefits. It would also provide the evidence requirements for these determinations. We published this subpart as an NPRM on September 20, 2006. See 71 FR 55052.

“Subpart E: Claims for Service Connection and Disability Compensation” would define service-connected disability compensation and service connection, including direct and secondary service connection. This subpart would inform readers how VA determines service connection and entitlement to disability compensation. The subpart would also contain those provisions governing presumptions related to service connection, rating principles, and effective dates, as well as several special ratings. We published this subpart as three separate NPRMs due to its size. We published the first, concerning presumptions related to service connection, on July 27, 2004. See 69 FR 44614. We published the second, concerning special ratings, on October 17, 2008. See 73 FR 62004. We published the third, concerning service-connection and other disability compensation, on September 1, 2010. See 75 FR 53744.

“Subpart F: Nonservice-Connected Disability Pensions and Death Pensions” would include information regarding the three types of nonservice-connected pension: Old-Law Pension, Section 306 Pension, and Improved Pension. This subpart would also include those provisions that state how to establish entitlement to Improved Pension and the effective dates governing each pension. We published this subpart as two separate NPRMs due to its size. We published the portion concerning Old-Law Pension, Section 306 Pension, and elections of Improved Pension on December 27, 2004. See 69 FR 77578. We published the portion concerning eligibility and entitlement requirements, as well as effective dates of Improved Pension, on September 26, 2007. See 72 FR 54776.

“Subpart G: Dependency and Indemnity Compensation, Accrued Benefits, and Special Rules Applicable Upon Death of a Beneficiary” would contain regulations governing claims for dependency and indemnity compensation (DIC); accrued benefits; and various special rules that apply to the disposition of benefits, or proceeds of benefits, when a beneficiary dies. This subpart would also include related definitions, effective-date rules, and rate-of-payment rules. We published this subpart as two separate NPRMs due to its size. We published the NPRM concerning accrued benefits, special rules applicable upon the death of a beneficiary, and several effective-date rules, on October 1, 2004. See 69 FR 59072. We published the NPRM concerning DIC benefits and general provisions relating to proof of death and service-connected cause of death on October 21, 2005. See 70 FR 61326.

“Subpart H: Special and Ancillary Benefits for Veterans, Dependents, and Survivors” would pertain to special and ancillary benefits available, including benefits for a child with various birth defects. We published this subpart as an NPRM on March 9, 2007. See 72 FR 10860.

“Subpart I: Benefits for Certain Filipino Veterans and Survivors” would pertain to the various benefits available to Filipino veterans and their survivors. We published this subpart as an NPRM on June 30, 2006. See 71 FR 37790.

“Subpart J: Burial Benefits” would pertain to burial allowances. We published this subpart as an NPRM on April 8, 2008. See 73 FR 19021.

“Subpart K: Matters Affecting the Receipt of Benefits” would contain provisions regarding bars to benefits, forfeiture of benefits, and renouncement of benefits. We published this subpart as an NPRM on May 31, 2006. See 71 FR 31056.

“Subpart L: Payments and Adjustments to Payments” would include general rate-setting rules, several adjustment and resumption regulations, and election-of-benefit rules. We published this subpart as two separate NPRMs due to its size. We published the first, concerning payments to beneficiaries who are eligible for more than one benefit, on October 2, 2007. See 72 FR 56136. We published the second, concerning payments and adjustment to payments, on October 31, 2008. See 73 FR 65212.

The final subpart, “Subpart M: Apportionments to Dependents and Payments to Fiduciaries and Incarcerated Beneficiaries” would include regulations governing apportionments, benefits for incarcerated beneficiaries, and guardianship. We published the NPRM, concerning apportionments to dependents and payments to fiduciaries and incarcerated beneficiaries, on January 14, 2011. See 76 FR 2766.

III. Tables Comparing Proposed Part 5 Rules With Current Part 3 Rules

The purpose of the Regulation Rewrite Project is to reorganize all of VA's compensation and pension rules in a logical, claimant-focused, and user-friendly format. We have redistributed the part 3 regulations into a new organizational structure, part 5. We have created two tables, the distribution table and the derivation table, to facilitate the understanding of the redistribution of the regulations. These tables are meant to aid users who are familiar with either Start Printed Page 71045the part 3 or the part 5 regulations and are searching for their counterparts in part 5 or part 3. We have updated the tables in this NPRM to reflect the proposed changes from the 20 initial NPRMs already published.

The distribution table lists the part 3 regulations by title and matches them with the corresponding part 5 regulations. There may not be an equivalent part 5 regulation for some part 3 regulations. This is indicated by the phrase “NO PART 5 REG—unnecessary” in the part 5 column. There are several reasons not to include certain part 3 regulations in part 5. It may be obsolete or repetitive of another provision that fully covers the intent of the regulation.

The derivation table is organized by subpart. Each subpart contains regulations relevant to the title of the subpart. The derivation table lists the proposed part 5 regulations in numerical order, with the corresponding part 3 paragraph numbers and the part 5 section title. Some of the part 5 regulations have no part 3 counterpart. This is indicated by the term “new” in the part 3 column. A regulation is determined to be “new” because it may be based on a change in law, a court decision, a General Counsel Opinion, or a manual provision.

As stated previously, there are also instances where we have not carried over a part 3 regulation into part 5. Where appropriate, we have included a comment explaining why part 5 does not include a certain part 3 provision. We propose to add part 5 citations to all the cross-references on the table to ensure that readers will be able to locate the relevant regulation.

IV. General Comments on Regulation Rewrite Project

One commenter, in response to AL70, “Presumptions of service connection for certain disabilities, and related matters”, suggested that VA's decision to rewrite and reorganize the provisions of part 3 and promulgate them as part 5 is not in the best interest of veterans. The commenter stated that as part 3 has withstood the scrutiny of the courts and has been changed accordingly, there is no reason to now rewrite it. Additionally, the commenter feared that the introduction of part 5 will lead to an increase in the number of appeals to the courts as the regulations undergo the rigors of judicial review, which will result in delays to claimants.

Another commenter asserted that proposed AL83, “Elections of Improved Pension; Old-Law and Section 306 Pension”, would add to the administrative costs of VA programs and therefore should not be adopted. This commenter urged VA to provide the services already promised rather than seek “to change the manner in which they are not put forward.”

The project to rewrite and reorganize the regulations responds to a recommendation made in the October 2001 “Report to the Secretary of Veterans Affairs” by the VA Claims Processing Task Force. The Task Force recommended that the Compensation and Pension (C&P) regulations be rewritten and reorganized in order to improve VA's claims adjudication process. These regulations are among the most difficult VA regulations for readers to understand and apply. The Project began its efforts by reviewing, reorganizing, and redrafting the regulations in 38 CFR part 3 governing the C&P programs of the Veterans Benefits Administration.

We disagree with the assertion of the commenters that rewriting and reorganizing the regulations in part 3 is not in the best interests of veterans. Although it is possible that the validity of the new part 5 regulations may be challenged in the short-term, in the long-term, rewriting and reorganizing these regulations will be beneficial to veterans. This is because part 5 will be better organized, which will allow readers and VA personnel to find information more easily. In addition, the part 5 regulations will be easier for the average reader to understand, will resolve many ambiguities and inconsistencies, and they will not include many outdated references and regulations that are found in part 3. Therefore, we propose to make no changes based on these comments.

One commenter asserted that, without legal authority, VA interprets, amends, and reverses laws enacted by Congress. The commenter stated that VA regulations obstruct compensation and “impose a separate, discriminatory, quasi-judicial process upon veterans.”

We respectfully disagree with the comment and propose to make no changes based on it. Congress has given VA authority to regulate in order to carry out statutory programs supporting veterans and their families, as stated in 38 U.S.C. 501, “Rules and regulations”. Paragraph (a) of section 501 includes the following:

  • The Secretary has authority to prescribe all rules and regulations which are necessary or appropriate to carry out the laws administered by the Department and are consistent with those laws, including—

○ regulations with respect to the nature and extent of proof and evidence and the method of taking and furnishing them in order to establish the right to benefits under such laws;

○ the forms of application by claimants under such laws;

○ the methods of making investigations and medical examinations; and

○ the manner and form of adjudications and awards.

The same commenter asserted that the Feres Doctrine (which restricts active duty servicemembers from filing suit against the U.S. Government) and the restrictions on veterans hiring attorneys to represent them in VA claims (see 38 U.S.C. 5904) are unconstitutional. The commenter also asserted that VA decisions have upheld the grant of “sovereign immunity” to the chemical companies that manufactured Agent Orange and other defoliants. Lastly, the same commenter urged that VA adopt a regulation requiring that any VA employee who wrongfully denies benefits to a veteran to be permanently removed from federal employment and lose all their retirement benefits. We propose to make no changes based on any of these comments because they are outside the scope of this rulemaking.

V. Technical Corrections and Changes to Terminology for Part 5

We propose to make certain additional technical corrections and changes in terminology in this proposed rule.

Technical Corrections

In addition to considering any necessary changes to proposed part 5 regulations based on comments received from the public, we propose to make certain technical corrections. These corrections include updated citations to certain regulations to which the NPRM referred. We are now replacing these “place holder” citations with the current part 5 citations.

Additionally, we propose to renumber certain regulations of part 5 in order to accommodate all needed regulations.

As stated previously in this preamble, we propose to eventually replace 38 CFR part 3 with a new part 5. We note that numerous 38 CFR sections reference part 3 sections. To update these citations throughout 38 CFR, we propose to add “or [insert part 5 section]” after each to include a reference to the part 5 equivalent to the referenced part 3 provision.

We have compiled the following table that lists the sections in 38 CFR outside part 3 that reference part 3 sections. In addition to the part 3 section, the list includes the corresponding part 5 citation. The list is organized by part. As discussed in various portions of this preamble, there are instances where a Start Printed Page 71046part 3 regulation will not be carried over into part 5. In those instances, we propose to simply leave the part 3 citation unchanged.

Table of References to 38 CFR Part 3 Sections

This table lists the sections in 38 CFR outside part 3 that reference part 3 sections. In addition to the part 3 section, the list includes the corresponding part 5 citation. The list is organized by part.

PartPart name38 CFR sectionPart 3 section referencedEquivalent part 5 citation
1General Provisions1.17(c)3.3115.269
1.911(f)(2)3.103(e)5.80
1.969(b)(1)3.104(a)5.160(a)
1.969(b)(2)3.105(a); 3.105(b)5.162(c); 5.162(f); 5.163
1.969(b)(3)3.1035.4(a); 5.4(b); 5.80; 5.81; 5.82; 5.83; 5.84
1.969(c)3.105(b)5.163
1.969(c)3.400(h)5.150(a); 5.166; 5.55(e)
4Schedule for Rating Disabilities4.33.1025.249(a); 5.4(b); 5.3(b)(2); 5.3(b)(3); 5.3(b)(5);
4.17(b)3.321(b)(2)5.380(c)(5)
4.28(Note(1))3.105(e)5.177(f)
4.29(a)(2)3.105(e)5.177(f)
4.29(g)3.321(b)(1)5.280
4.30 (introduction)3.105(e)5.177(f)
4.30(a)(3)3.105(e)5.177(f)
4.71a (table II) (row 2 column 2)3.350(c)(1)(i)5.326(a)
4.71a (table II) (row 2 column 3)3.350(b)5.324
4.71a (table II) (row 2 column 4)3.350(f)(1)(x)5.327(a)
4.71a (table II) (row 2 column 5)3.350(f)(1)(vi)5.325(c)
4.71a (table II) (row 2 column 6)3.350(f)(1)(xi)5.328(b)
4.71a (table II) (row 2 column 7)3.350(f)(1)(viii)5.326(f)
4.71a (table II) (row 3 column 3)3.350(b)5.324
4.71a (table II) (row 3 column 4)3.350(f)(1)(iii)5.325(b)
4.71a (table II) (row 3 column 5)3.350(f)(1)(i)5.325(a)
4.71a (table II) (row 3 column 6)3.350(f)(1)(iv)5.326(d)
4.71a (table II) (row 3 column 7)3.350(f)(1)(ii)5.326(c)
4.71a (table II) (row 4 column 4)3.350(d)(1)5.328(a)
4.71a (table II) (row 4 column 5)3.350(c)(1)(iii)5.326(e)
4.71a (table II) (row 4 column 6)3.350(f)(1)(ix)5.327(d)
4.71a (table II) (row 4 column 7)3.350(f)(1)(xi)5.328(b)
4.71a (table II) (row 5 column 5)3.350(c)(1)(ii)5.326(b)
4.71a (table II) (row 5 column 6)3.350(f)(1)(vii)5.327(c)
4.71a (table II) (row 5 column 7)3.350(f)(1)(v)5.327(b)
4.71a (table II) (row 6 column 6)3.350(e)(1)(i)5.330(a)
4.71a (table II) (row 6 column 7)3.350(d)(3)5.328(d)
4.71a (table II) (row 7 column 7)3.350(d)(2)5.328(c)
4.71a Note to table II3.350(b); 3.350(e)(2); 3.350(f)(3); 3.350(f)(4); 3.350(f)(5)5.324; 5.330(d); 5.331(d); 5.331(e); 5.331(f)
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4.73 Note3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.73 Note after (the pelvic girdle and thigh)3.350(a)(3)5.323(d)(1); 5.323(d)(2)
4.73 Note after 5327 (miscellaneous)3.105(e)5.177(f)
4.73 Note after 5329 (miscellaneous)3.105(e)5.177(f)
4.75(c)3.383(a)5.383(b)
4.75(f)3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.79 Note after 60143.105(e)5.177(f)
4.79 footnote 1 after (diseases of the eye)3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.79 footnote 1 after (ratings for impairment of visual fields)3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.85(f)3.3835.283
4.85(g)3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.87 Note after (6208)3.105(e)5.177(f)
4.88b Note after (6301)3.105(e)5.177(f)
4.88b Note after (6302)3.105(e)5.177(f)
4.96(c)3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.97 Note after (6731)3.105(e)5.177(f)
4.97 Note after (6819)3.105(e)5.177(f)
4.97 footnote 13.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.104 Note after (7011)3.105(e)5.177(f)
4.104 Note after (7016)3.105(e)5.177(f)
4.104 Note after (7019)3.105(e)5.177(f)
4.104 Note after (7110)3.105(e)5.177(f)
4.104 Note 3 after (7111)3.105(e)5.177(f)
Start Printed Page 71048
4.104 Note after (7123)3.105(e)5.177(f)
4.114 Note after (7343)3.105(e)5.177(f)
4.114 Note after (7351)3.105(e)5.177(f)
4.115b Note3.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.115b Note after (7528)3.105(e)5.177(f)
4.115b Note after (7531)3.105(e)5.177(f)
4.115b footnote 13.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.116 Note23.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.116 Note after (7627)3.105(e)5.177(f)
4.116 footnote 13.3505.323; 5.322; 5.324; 5.325; 5.326; 5.327; 5.328; 5.329; 5.330; 5.331(c); 5.331(d); 5.331(f); 5.332; 5.333; 5.346(b)(1)(i); 5.346(b)(2);
4.117 Note after (7702)3.105(e)5.177(f)
4.117 Note after (7703)3.105(e)5.177(f)
4.117 Note after (7709)3.105(e)5.177(f)
4.117 Note after (7714)3.321(b)(1)5.280
4.117 Note after (7715)3.105(e)5.177(f)
4.117 Note after (7716)3.105(e)5.177(f)
4.118 Note after (7818)3.105(e)5.177(f)
4.118 Note after (7833)3.105(e)5.177(f)
4.119 Note after (7914)3.105(e)5.177(f)
4.119 Note after (7919)3.105(e)5.177(f)
4.12a Note(5) after (8045)3.1145.152
4.1273.310(a)5.246
4.1283.105(e)5.177(f)
14Legal Services, General Counsel, and Miscellaneous Claims14.636(c)3.1565.3(b)(6); 5.55; 5.153; 5.165
14.636(h)(1)(iii)3.7505.745
17Medical17.36(b)(7)3.271; 3.272; 3.273; 3.2765.370; 5.410(a); 5.410(c); 5.410(d); 5.410(e); 5.410(f); 5.412; 5.413; 5.414(a); 5.414(c); 5.421; 5.423(a); 5.423(b); 5.423(e); 5.706(b); 5.707(c)
17.39(a)3.42(c)5.613
17.39(b)3.42(c)5.613
17.47(d)(4)3.271; 3.2725.370; 5.410(a); 5.410(c); 5.410(d); 5.410(e); 5.410(f); 5.411(a); 5.411(c); 5.412; 5.413; 5.706(b); 5.707(c)
17.47(d)(5)3.2755.410(d); 5.411(b), 5.411(c), 5.412(a); 5.414; 5.706(b);
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17.96(a)(1)3.1(u);3.1(w)5.1 (Improved Pension); 5.1 (Section 306 Pension); 5.460
17.9003.814(c)(2); 3.815(c)(2)5.589; 5.590
17.9003.815(c)(3)5.590
17.9003.814(c)(1); 3.815(c); 3.815(c)(1)5.589; 5.590
17.901(a)3.814; 3.8155.589; 5.590; 5.591
17.901(b)3.815; 3.815(a)(2)5.590
17.903(a)(2)(i)3.8145.589; 5.591
17.903(a)(2)(ii)3.8155.590; 5.591
18Nondiscrimination in Federally Assisted Programs of the Department of Veterans Affairs-Effectuation of Title VI of the Civil Rights Act of 1964Appendix B to Subpart E of part 18 (Veterans' Benefits) (Adjudication)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
Appendix B to Subpart E of part 18 (Survivors' and Dependents' Educational Assistance) (Adjudication)3.57; 3.807(d)5.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
Appendix B to Subpart E of part 18 (Survivors' and Dependents' Educational Assistance) (Adjudication) (Survivors' and Dependent's Educational Assistance Under 38 U.S.C. Chapter 35)3.807(d).
Appendix B to Subpart E of part 18 (Veterans' Educational Assistance)3.50; 3.57; 3.595.1 (Custody of a child); 5.201(a); 5.203(b); 5.220; 5.223; 5.225; 5.226; 5.238; 5.417; 5.435; 5.695(a)
20Board of Veterans' Appeals: Rules of Practice20.101(a)(28)3.812(d)5.588
20.1502(c)(3)3.1565.3(b)(6); 5.55; 5.153; 5.165
20.1502(c)(4)3.1055.162
20.1503(d)3.159(b)(1)5.90
20.1504(b)3.159(c)5.90
20.15053.26005.161
20.1507(a)3.103(c); 3.2600(c)5.82; 5.161
20.1507(a)(2)3.26005.161
Appendix A to part 20 (20.1)3.1035.4(a); 5.4(b); 5.80; 5.81; 5.82; 5.83; 5.84
Appendix A to part 20 (20.1105)3.156; 3.1605.3(b)(6); 5.55; 5.153; 5.165; 5.57(b)-(d)
Appendix A to part 20 (20.1106)3.225.520(b); 5.521; 5.522
Appendix A to part 20 (20.1304)3.103; 3.156; 3.1605.3(b)(6); 5.4(a); 5.4(b); 5.55; 5.80; 5.81; 5.82; 5.83; 5.84; 5.153; 5.165; 5.57(b)-(d)
21Vocational Rehabilitation and Education21.33 Cross-Reference3.1035.4(a); 5.4(b); 5.80; 5.81; 5.82; 5.83; 5.84
21.42(b)(1)3.125.30; 5.31(c); 5.31(e); 5.32; 5.33; 5.34(c); 5.35(b)-(d); 5.36; 5.39
21.48(a)3.105(d); 3.105(e)5.83(a) 5.175(b)(1); 5.175(b)(2); 5.177(d); 5.177(f)
21.260(d)3.50; 3.51; 3.57; 3.595.1 (Custody of a child); 5.201(a); 5.203(b); 5.220; 5.223; 5.225; 5.226; 5.238; 5.417; 5.435; 5.695(a)
21.330(a)3.451; 3.4585.771; 5.775
21.330(b)3.400(e)5.782
21.414(a)3.105(a)5.162(c); 5.162(f)
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21.414(b)3.105(b)5.163
21.414(c)3.105(c)5.177(e)
21.414(d)3.105(d)5.177(d)
21.414(e)3.105(e)5.177(f)
21.422(d)(3)3.103(c); 3.103(d)5.81; 5.82
21.3021(a)(2)(ii)3.6(a); 3.8075.21(a); 5.586(b); 5.586(c)
21.3021(b)3.40(b); 3.40(c); 3.40(d); 3.807(d)5.610
21.3021 Cross-Reference3.65.21(a); 5.22(a); 5.23; 5.24; 5.25; 5.29
21.3021 Cross-Reference (persons included)3.75.21(a); 5.23(a)-(b); 5.24(a); 5.25(a)-(b); 5.28; 5.31(c)
21.3021 Cross-Reference (Philippine and insular forces)3.405.610
21.3023 Cross-Reference (concurrent payments)3.7075.764(b); 5.764(c); 5.764(d)
21.3023 Cross-Reference (certification)3.8075.586(b); 5.586(c)
21.3024 Cross-Reference3.7085.750; 5.751
21.3041(e)3.57(c)5.223(b)
21.3131(d)3.40(b); 3.40(c); 3.40(d)5.610
21.3133(c)3.10005.1 (Accrued benefits); 5.1 (Evidence in the file on the date of death); 5.551; 5.784; 5.552(a); 5.552(b); 5.553; 5.554
21.3306(b)(3)(ii)3.1025.3(b)(2); 5.3(b)(3); 5.3(b)(5); 5.4(b); 5.249(a)
21.3333(c)3.40(b); 3.40(c); 3.40(d)5.610
21.4003(a)3.105(a)5.162(c); 5.162(f)
21.4003(b)3.105(b)5.163
21.4003(c)3.105(c)5.177(e)
21.4003(d)3.105(d)5.177(d)
21.40073.900; 3.901(except paragraph (c)); 3.902 (except paragraph (c)); 3.903;3.904; 3.9055.675(a); 5.676(b) and (c); 5.677(b) and (c); 5.678(b)(3); 5.675(b); 5.1 (Fraud (1)); 5.676(a); 5.676(b)(2); 5.676(b)(1); 5.676(b)(3)(i); 5.680(c)(1); 5.680(c)(2); 5.677; 5.678; 5.676(d); 5.677(b)(3)(ii); 5.677(c)(2); 5.678(b)(3)(iv); 5.678(c)(2); 5.679; 5.680(a); 5.680(c)(3)
21.4135(t)3.114(b)5.152
21.4200(x)3.1(i)5.1 (State)
21.5021(b)(5)3.155.21(b); 5.39(e)
21.5021(l)3.1(j)5.191
21.5021(m)3.1(j); 3.525.191; 5.200(a); 5.200(b)
21.5021(n)(2)3.57; 3.585.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a); 5.224(a)
21.5021(o)3.595.238
21.5040(b)(2)(ii)3.13(c)5.37(d)
21.5040(b)(3)3.12; 3.135.30; 5.31(c); 5.31(e); 5.32; 5.33; 5.34(c); 5.35(b)-(d); 5.36; 5.39; 5.37(b); 5.37(c); 5.37(d)
21.5040(c)(3)3.155.21(b); 5.39(e)
21.5040(d)(1)(ii)3.4(b)5.24(a); 5.24(b)
21.5040(d)(3)3.155.21(b); 5.39(e)
21.5065(b)(5)(iv)3.4(b)5.24(a); 5.24(b)
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21.5065(b)(6)3.155.21(b); 5.39(e)
21.5067(c)3.10005.1 (Accrued benefits); 5.1 (Evidence in the file on the date of death); 5.551; 5.784; 5.552(a); 5.552(b); 5.553; 5.554
21.5740(b)(2)(iii)3.4(b)5.24(a); 5.24(b)
21.5740(b)(3)3.155.21(b); 5.39(e)
21.5742(a)(1)3.155.21(b); 5.39(e)
21VR&E21.6050(a)3.3425.380; 5.347
21.6050(b)3.3425.380; 5.347
21.6420(d)3.3435.286; 5.347
21.6501(a)3.340; 3.3415.284; 5.285
21.6503(b)3.340; 3.3415.284; 5.285
21.6507(a)3.343(c)(2)5.286
21.6521(b)3.343(c)(2)5.286
21.7020(b)(1)(iii)3.6(b)5.22(a); 5.22(b); 5.23(a)(1); 5.23(b)(1); 5.24(a); 5.24(b)(1); 5.25(a); 5.29(a)
21.7020(b)(1)(iv)3.6(b)5.22(a); 5.22(b); 5.23(a)(1); 5.23(b)(1); 5.24(a); 5.24(b)(1); 5.25(a); 5.29(a)
21.7020(b)(9)(ii)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
21.7020(b)(9)(iii)3.595.238(a); 5.238(c); 5.238(e)(1) and 5.238(e)(2)(i)
21.70423.155.21(b); 5.39(e)
21.70443.155.21(b); 5.39(e)
21.7080(c)(3)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
21.7080(c)(4)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
21.7031(e) Cross-Reference3.6675.551(a); 5.695(b); 5.695(c); 5.695(d); 5.695(f)-(i)
21.7135(y)3.114(b)5.152
21.7140(g)3.10005.1 (Accrued benefits); 5.1 (Evidence in the file on the date of death); 5.551; 5.784; 5.552(a); 5.552(b); 5.553; 5.554
21.7280(b)(2)3.3125.504
21.7303(a)3.105(a)5.162(c); 5.162(f)
21.7303(b)3.105(b)5.163
21.7635(u)3.114(b)5.152
21.7803(a)3.105(a)5.162(c); 5.162(f)
21.7803(b)3.105(b)5.163
21.8010(a)3.815(c)(3)5.590
21.8010(a)3.814(c)(2); 3.815(a)(2); 3.815(c)(2)5.589; 5.590
21.8010(a)3.814(c)(3)5.589
21.8010(a)3.814(c)(1); 3.815(c)(1)5.589; 5.590
21.9570(b)(3)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
21.9570(b)(4)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
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21.9625(j)(4)3.575.1 (Custody of a child); 5.417; 5.220; 5.223; 5.225; 5.226; 5.435; 5.695(a)
21.9635(u)3.114(b)5.152
21.9680(e)3.10005.1 (Accrued benefits); 5.1 (Evidence in the file on the date of death); 5.551; 5.784; 5.552(a); 5.552(b); 5.553; 5.554

Changes in Terminology for Clarity or Consistency

We propose changes in terminology in this rulemaking primarily to achieve consistency throughout part 5. For example, while reviewing the NPRMs, we noted that we had used the word “termination” interchangeably with the word “discontinuance” (including variations of the two words). To ensure clarity and consistency in our part 5 regulations, we propose to use the term “discontinuance” throughout. The word “discontinuance” is more accurate because there are occasions when the benefit is not terminated, but discontinued for a period, and then resumed. Similarly, we propose to use “person” rather than “individual” in all instances where either term would apply.

According to paragraph 12.9 of the Government Printing Office Style Manual (2008), numerals rather than words are used when referring to units of measurement and time. Therefore, we propose to substitute the number for the word (for example, “1 year” instead of “one year”) throughout part 5.

Another source of ambiguity and confusion is the phrase “on or after” which is used in connection with a specific date when discussing the effective date of a regulatory provision or the date by which an event must have occurred. For example, a regulatory provision might be effective “on or after” October 1, 1982, which to some may seem to permit a choice between “on” or “after”. The simplest way to eliminate this ambiguity is to identify the day before the effective date and precede that date with the word “after”. In the above example, the regulatory provision would be effective “after September 30, 1982”. This method of stating effective dates makes our regulations easier to understand and apply.

We noted that in the NPRMs we used “VA benefits” and “benefits” inconsistently and interchangeably. We propose to define “Benefit” as “ any VA payment, service, commodity, function, or status, entitlement to which is determined under this part, except as otherwise provided.” Therefore, we propose to generally not include “VA” before “benefit”. However, we propose to still use “VA benefit” when that term is needed to distinguish it from some other benefit such as a Social Security benefit or some benefit for which election is required (e.g. Radiation Exposure Compensation Act).

Removal of Death Compensation Provisions

There are less than 300 beneficiaries currently receiving death compensation. Except for one small group of beneficiaries, death compensation is payable only if the veteran died prior to January 1, 1957. VA has not received a claim for death compensation in over 10 years and we do not expect to receive any more.

Because of the small number of beneficiaries of death compensation, there is no need to include the provisions concerning claims for death compensation in part 5. We therefore propose to remove the death compensation provisions (§§ 5.560-5.562) that were initially proposed in AL71. 69 FR 59072, Oct. 1, 2004. We propose to reserve §§ 5.560-5.562 for later use. We propose to revise § 5.0 (the scope provision for part 5), as initially proposed in AL87, 71 FR 16464, Mar. 31, 2006, to direct that any new claims for death compensation or actions concerning death compensation benefits be adjudicated under part 3. We propose to retain provisions regarding death compensation in subpart L because a death compensation beneficiary may still elect to receive dependency and indemnity compensation instead.

Removal of Spanish-American War Death Pension Provisions

There is currently one beneficiary receiving a Spanish-American War death pension. Therefore, the provisions concerning Spanish-American War death pensions should not be carried forward to part 5. Instead, we propose to remove the Spanish-American War death pension provisions initially proposed in AL83 (§§ 5.460(c) and 5.462). 69 FR 77578, Dec. 27, 2004. We propose to reserve § 5.462 for later use. In addition, we propose to change initially proposed § 5.0 (the scope provision for part 5) as proposed in AL87, 71 FR 16464, Mar. 31, 2006, to direct that any new claims or actions concerning Spanish-American War death pension benefits be adjudicated under part 3.

Change in Titles of Certain VA Officials

Effective April 11, 2011, VA reorganized its Compensation and Pension Service by dividing it into several smaller entities, including the Compensation Service and the Pension and Fiduciary Service. We propose to update these terms throughout part 5.

VI. Subpart A: General Provisions AL87

In a document published in the Federal Register on March 31, 2006, we proposed to revise Department of Veterans Affairs (VA) regulations concerning general compensation and pension provisions. See 71 FR 16464. We provided a 60-day comment period that ended May 30, 2006. We received submissions from seven commenters: Paralyzed Veterans of America, Disabled American Veterans, Disabled American Veterans Chapter 57, Vietnam Veterans of America, National Organization of Veterans' Advocates, and two members of the general public.Start Printed Page 71053

§ 5.0 Scope and Applicability

In the NPRM, we identified proposed § 5.0 as a new regulation in the derivation table. 71 FR 16465-16466, Mar. 31, 2006. However, initially proposed § 5.0 is derived from § 3.2100, which governs the applicability of rules in one subpart of 38 CFR part 3. Section 5.0(a) states a similar applicability provision for all of part 5, with only minor revisions to conform it to the part 5 formatting and numbering. The derivation and distribution tables are corrected accordingly.

To provide a smooth transition from part 3 to part 5 we propose to add a new paragraph (b) to initially proposed § 5.0 establishing the applicability date for part 5. We propose two rules to govern the applicability date of part 5, and two rules to state the different situations in which part 3 would still apply. These rules would make it clear that part 5 will apply prospectively, but not retroactively.

To have part 5 apply immediately to all pending cases would require readjudication of thousands of claims (e.g. those where a decision has been rendered by the agency of original jurisdiction and the appeal period has not expired), which would significantly delay processing new claims being filed with VA. We believe that our proposed applicability structure will be the most efficient way to transition from part 3 to part 5 and is clear both to VA employees and to the members of the public who use VA regulations.

We propose to have part 3 continue to apply to all death compensation and Spanish-American War benefits. As explained in detail later in this preamble, these two benefit programs have very limited numbers of beneficiaries or potential claimants, and these claims can continue to be processed under part 3, so there is no need to include them in part 5.

To ensure that users of part 3 are aware of part 5's applicability, we propose to add a new § 3.0 to 38 CFR part 3. This section will be titled Scope and applicability and will state that part 5, not part 3, will apply to claims filed on or after the effective date of the final rule.

We note that part 5 is not a “liberalizing VA issue approved by the Secretary or at the Secretary's direction” under § 5.152 with regard to a claim that was filed while part 3 was still in effect for new claims. That is because part 5 does not apply to a claim that was filed while part 3 was still in effect for new claims. Therefore, part 5 cannot be liberalizing with respect to such a claim.

§ 5.1 General Definitions

Initially proposed § 5.1, included the following definition of the term “agency of original jurisdiction”: “Agency of original jurisdiction means the VA activity that is responsible for making the initial determination on an issue affecting a claimant's or beneficiary's right to benefits.” In the preamble to the AL87 NPRM, we noted that this definition differed somewhat from a definition of the same term in 38 CFR 20.3(a), which reads as follows: “Agency of original jurisdiction means the Department of Veterans Affairs activity or administration, that is, the Veterans Benefits Administration, Veterans Health Administration, or National Cemetery Administration, that made the initial determination on a claim.” We stated that, “The difference is because of the narrower scope of part 5 and because the definitions in § 20.3 apply in an appellate context while the definitions in proposed § 5.1 do not.”

Notwithstanding our initially proposed reason for creating a different definition, we have determined that it is unnecessary because the § 20.3(a) definition will work well in part 5. Moreover, having two different definitions, even if the two are substantially the same, could cause a reader to mistakenly believe that VA intends to define “agency of original jurisdiction” differently depending on whether a case is pending at a VA regional office or at the Board of Veterans' Appeals (the Board). We therefore propose to replace the definition from the AL87 NPRM with the § 20.3(a) definition.

In response to RIN 2900-AM05, “Matters Affecting Receipt of Benefits”, we received several comments on our proposed definitions of “willful misconduct”, “proximately caused”, and “drugs”. 71 FR 31056, May 31, 2006. Because these terms apply to several different subparts in part 5, we propose to move them to § 5.1 and will therefore discuss these comments in connection with § 5.1 below.

In proposed rulemaking RIN 2900-AM16, VA Benefit Claims, we initially proposed definitions of “application” and “claim”, to be added to § 5.1, “General definitions”. 73 FR 20138, Apr. 14, 2008. In that rulemaking, we proposed that, “Application means a specific form required by the Secretary that a claimant must file to apply for a benefit” and “Claim means a formal or informal communication in writing requesting a determination of entitlement, or evidencing a belief in entitlement, to a benefit.”

In responding to this comment, we determined that we had used the terms “file” and “submit” interchangeably in the NPRMs. We note that other provisions in title 38 use “submit” or variants thereof with respect to the presentation of evidence. See proposed 38 current 38 CFR 3.103(b)(2), 3.203(c), and 20.1304. We note also that there is a reasonable basis for using “file” in relation to documents initiating claims and appeals and “submit” in relation to presentation of evidence: it appears that Congress has used the term “file” only in relation to documents that have procedural significance in terms of initiating claims or appeals. See 38 U.S.C. 5101(a), 7105(b), (c), and (d)(3). In referring to the presentation of evidence, Congress has used a variety of other terms, such as “submit[ ]” (38 U.S.C. 108(b)), “furnish” (sec. 5101(c)), “provide[ ]” (sec. 5103), or “present[ ]” (sec. 5108). Further, it is possible that “file” may suggest a requirement for a written submission—which is appropriate for claims, notices of disagreement, and substantive appeals—whereas “submit” would include oral presentation of evidence at a hearing. For these reasons, we propose throughout part 5 to use “file” in relation to documents initiating claims and appeals and “submit” in relation to presentation of evidence.

One commenter commented on our initially proposed definition of “claimant,” which stated that, “any person applying for, or filing a claim for, any benefit under the laws administered by VA”, noting that the term “claim” has a different meaning than “application”. The commenter noted that a claim does not end with the disposition of the application and that there may be subsequent administrative actions in a claim which were not initiated by any application and action by the claimant. The commenter did not address the substance of our definitions nor did the commenter suggest any revisions. For the reasons set forth in the preamble to proposed AM16, our definitions of “application” and “claim” reflect the distinctions described by the commenter. We therefore propose to make no changes based on the comment.

One commenter objected to the scope of our definition of “claimant”, noting that Congress, in 38 U.S.C. 5100, restricted the definition of “claimant” to 38 U.S.C. chapter 51. The commenter asserted that VA should restrict its definition to 38 CFR part 5. The commenter then noted that 38 U.S.C. 7111 also uses the word “claimant” in connection with a review of a Board decision on grounds of clear and Start Printed Page 71054unmistakable error. The commenter asserted that, in 38 U.S.C. 7111, the person whose file is under review is not a claimant.

The first phrase of § 5.1 states that, “The following definitions apply to this part”. Although other parts of 38 CFR may adopt the definitions used in part 5 by expressly stating so, the definitions we provided in § 5.1 are restricted by this phrase to use in part 5 unless adopted in other parts. The situation described by the commenter (concerning the person whose file is being reviewed by the Board) is not related to this rule because it concerns 38 CFR part 20. As stated above, the regulation as initially proposed already restricts the application of the definition of claimant to part 5.

Based on this comment, however, we propose to narrow the definition of “claimant” to “a person applying for, or filing a claim for, any benefit under this part.” Because § 5.1 applies only to part 5, it is beyond the scope of this section to include as a part 5 claimant a person who is seeking VA benefits under another part of title 38 CFR, such as health care. For the same reason, we propose to make similar changes to our definitions of “claim”, “beneficiary”, and “benefit”.

We propose to add the definition of “custody of a child,” which means that a person or institution is legally responsible for the welfare of a child and has the legal right to exercise parental control over the child. Such a person or institution is the “custodian” of the child. This definition is consistent with the definition of “child custody” in 38 CFR 3.57(d) and with current VA practice and usage in 38 CFR part 3.

In AM05, § 5.661(a)(3), we initially proposed to define the term “drugs” as “prescription or non-prescription medications and other substances (e.g., glue or paint), whether obtained legally or illegally.” The definition is now proposed in § 5.1. A commenter suggested an amendment to this definition. The commenter asserted that the definition should include the word “chemical” because in the commenter's view, “chemical” abuse also causes euphoria and “chemicals” are widely abused. Our initially proposed definition used the term “other substances” to describe the chemicals discussed by the commenter. We intended our definition to include organic substances, such as hallucinogenic mushrooms, and all other substances that may be abused to cause intoxication.

In reviewing this comment, we determined that the “other substances” language of our definition may have been overly broad. For instance, it might be misconstrued to include any substance, for example, water. In order to avoid this potential misinterpretation, we propose to modify our basic definition of drugs to read as follows: “chemical substances that affect the processes of the mind or body and that may cause intoxication or harmful effects if abused.” The language about affecting the mind or body is taken from “Dorland's Illustrated Med. Dictionary” 575 (31st ed. 2007). We propose to add the language about intoxication or harmful effects to ensure that we exclude items which technically are chemical substances that might affect the mind or body (for example, commercially prepared prune juice), but do not cause intoxication or harmful effects. We propose to add a second sentence to incorporate important concepts already stated in the initially proposed definition: that our definition includes prescription and non-prescription drugs and includes drugs that are obtained legally or illegally.

Another AM05 commenter stated that the phrase “obtained legally or illegally” was unnecessary and contained a negative implication. The commenter recommended saying, “however obtained” instead. We used the phrase “obtained legally or illegally” because as we stated in the NPRM, this phrase is sufficiently broad to cover all the means of obtaining drugs or other substances. We used the phrase “obtained legally or illegally” to ensure that the regulation makes clear that a properly prescribed drug, obtained legally, may be abused such as to cause intoxication and thus proximately cause injury, disease, or death. We propose to make no changes based on this comment because the recommended change would not make clear that the abuse of legally obtained drugs is also considered drug abuse constituting willful misconduct under § 5.661(c).

We do propose, however, to change “and drugs that are obtained legally or illegally” to “whether obtained legally or illegally.” This makes it clearer that “legally or illegally” applies to how prescription and non-prescription drugs are obtained. The language initially proposed could be misread to mean that there are four distinct categories of drugs, prescription, non-prescription, legally obtained, and illegally obtained. “Whether obtained legally or illegally” makes it clear that there are two categories, prescription and non-prescription, either of which could be obtained legally or illegally.

We propose to define “effective the date of the last payment” as paragraph (s) in § 5.1. This term is commonly used in part 3 as “effective date of last payment”, but not defined in part 3. In certain cases of reduction, suspension, or discontinuance of benefit payments, VA adjusts payments effective the date of the last payment of benefits. This means that “VA's action is effective as of the first day of a month in which it is possible to suspend, reduce, or discontinue a benefit payment without creating an overpayment.” We are adding the word “the” before “date” and “last” for clarity.

One commenter noted that the definition of “fraud” depended on where in the regulations it was used. This commenter expressed the opinion that the meaning of a word in a statute is presumed to be the common law meaning unless Congress has plainly provided otherwise. The commenter then expressed the opinion that none of the definitions of fraud presented in initially proposed § 5.1 incorporate all the common law aspects of fraud, especially the requirement for proof of fraudulent intent and the requirement for proof by clear evidence.

We first note that Congress has specifically defined “fraud” in 38 U.S.C. 6103(a) for purposes of forfeiture of benefits. We incorporated that definition in paragraph (1) of our initially proposed definition of fraud and then proposed to make it VA's “general definition” of fraud. In reviewing our definition based on this comment, we have determined that there is no need for a general definition of fraud, since the term is only used in the context of forfeiture. We therefore propose to limit the scope to instances of forfeiture.

Regarding the commenter's assertion regarding common law, we note that the five elements of common law fraud are: (1) A material misrepresentation by the defendant of a presently existing fact or past fact; (2) Knowledge or belief by the defendant of its falsity; (3) An intent that the plaintiff rely on the statement; (4) Reasonable reliance by the plaintiff; and 5) Resulting damages to the plaintiff. See 100 Am. Jur. Proof of Facts 3d section 8. The intent element of the common law definition of fraud relates to the defendant's desire for the plaintiff's reliance on the statement, while the material misrepresentation only requires that the person committing the fraud have a knowledge or belief that the statement is false.

As stated above, our proposed definition of fraud in § 5.1 now relates only to forfeiture and is consistent with the applicable statute. There is no requirement that our definitions in § 5.1 conform to the common law definition. Start Printed Page 71055Veterans benefits and the body of law VA applies are often very different from the common law. Moreover, the intent requirement described in the third common law element above is contained in § 5.1 in the language requiring an “intentional” misrepresentation or failure to disclose pertinent facts “for purpose of obtaining” the specified objective.

Although some State jurisdictions require “clear” or “clear and convincing” evidence of fraud in various contexts, the Supreme Court has stated that “Congress has chosen the preponderance standard when it has created substantive causes of action for fraud.” Grogan v. Garner, 498 U.S. 279, 288 (1991). Congress should not be presumed to have intended a higher standard of proof where it has not specified such a standard. See id. at 286; Thomas v. Nicholson, 423 F.3d 1279, 1284 (Fed. Cir. 2005). The definitions in these rules implement statutes that do not specify a higher standard of proof, and our general rules for evaluating evidence will suffice in determinations concerning fraud. Since we already include an intent element where it is appropriate and our standards of proof are appropriate for our decisions, we propose to make no changes based on this comment.

We propose to remove the definitions for “in the waters adjacent to Mexico” and “on the borders of Mexico”. Both of these phrases applied to determining entitlement to benefits for the Mexican Border War. There are no surviving veterans of this war, so the definitions are no longer necessary.

We initially proposed to define “notice,” now proposed § 5.1, as “written notice sent to a claimant or beneficiary at his or her latest address of record, and to his or her designated representative and fiduciary, if any.” In reviewing this definition to respond to a comment, we determined that limiting this definition only to written communications could create unintended problems. In Paralyzed Veterans of America v. Sec'y of Veterans Affairs, 345 F.3d 1334, 1349 (Fed. Cir. 2003), the court held that the requirement in 38 U.S.C. 5103A(b)(2) that VA “notify” a claimant of VA's inability to obtain certain evidence may be satisfied by either written or oral notice. The court noted that “[i]t is certainly not unreasonable, in our view, for VA to retain the flexibility to provide oral rather than written notice, as it is clear that under certain circumstances oral notice might be the preferred or more practicable option.” In addition, there may be other situations besides those involving section 5103A(b)(2) where written notice is not practicable and that it would not be desirable to limit the definition of “notice” to only written communications. When a specific statute or regulation requires written notice, we propose to signify that in part 5 by using the term “written” in that specific context (e.g., § 5.83(b) based on § 3.103(a) and (b)).

In addition, we have determined that the use of the defined term as part of the definition is not useful to the reader. The term “notice” is more accurately defined as a “communication,” as opposed to a “notice.” We, therefore, propose to define “notice” as either:

  • A written communication VA sends a claimant or beneficiary at his or her latest address of record, and to his or her designated representative and fiduciary, if any; or
  • An oral communication VA conveys to a claimant or beneficiary.

Additionally, we propose to add the definition of “payee”. This term is used throughout part 5. We propose to define this term in § 5.1 as a person to whom monetary benefits are payable.

One AM05 commenter disagreed with our initially proposed definition of “proximately caused”. This commenter also disagreed with including a definition of “proximate cause” in the regulation, stating that the concept has a long history and that for VA to select one definition narrows the concept, which may not work in the favor of veterans. The commenter also objected to restricting the definition to the second definition found in “Black's Law Dictionary” 213 (7th Ed. 1999).

It is necessary to define “proximately caused” because it has many definitions, as the commenter noted. Moreover, we do not believe the concept is well-known by the public. Claimants, beneficiaries, veterans' representatives, and VA employees are the primary users of regulations. It is important that we choose one definition, to ensure a common understanding of our regulations and to ensure that all users apply them the same way.

We selected the second definition of “proximately caused” from “Black's Law Dictionary” 234 (7th ed. 1999) (the same definition is used in the 8th Edition (2004) and the 9th Edition (2009)), because that definition most closely reflects the way VA and the U.S. Court of Appeals for Veterans Claims (CAVC) apply the concept. See, for example, Forshey v. West, 12 Vet. App. 71, 73-74 (1998) (“ `Proximate cause' is defined as `that which, in a natural continuous sequence, unbroken by any efficient intervening cause, produces injury, and without which the result would not have occurred.' “Black's Law Dictionary” 1225 (6th ed.1990).”). We chose not to adopt the first definition because it deals with liability and the VA system is not a tort-claims system. Congress has specified different court procedures for tort actions. We therefore propose to make no changes based on this comment.

We propose to add a definition of “psychosis” as § 5.1 because other part 5 regulations use the term. The definition is based on 38 CFR 3.384, which defines it as any of the following disorders listed in Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition, Text Revision, of the American Psychiatric Association (DSM-IV-TR):

  • Brief Psychotic Disorder;
  • Delusional Disorder;
  • Psychotic Disorder Due to General Medical Condition;
  • Psychotic Disorder Not Otherwise Specified;
  • Schizoaffective Disorder;
  • Schizophrenia;
  • Schizophreniform Disorder;
  • Shared Psychotic Disorder; and
  • Substance-Induced Psychotic Disorder.

We propose to add definitions of the terms “service-connected”, § 5.1, and “nonservice-connected” as § 5.1. Both of these definitions are identical to those in 38 U.S.C. 101(16) and (17), except that we use the term “active military service” in lieu of the longer term “active military, naval, or air service”. See 69 FR 4820, Jan. 30, 2004.

We initially proposed a definition of “service medical records” in § 5.1. We now propose to change the defined term to “service treatment records”, now § 5.1. The Benefits Executive Council, co-chaired by senior VA and Department of Defense (DoD) officials, formally changed the term for a packet of medical records transferred from DoD to VA upon a servicemember's release from active duty. Specifically, they found that VA, the reserve components, and all of the military services, used approximately 20 different phrases for what VA referred to as “service medical records”. They concluded that this inconsistent use of terminology was a contributing factor in the fragmented processing of medical records. This proposed change would implement the Benefits Executive Council's directive.

We omitted the Canal Zone from the initially proposed definition of “State” in § 5.1, because § 3.1(i) does not include the Canal Zone in its definition of “State”. However, 38 U.S.C. 101(20) defines “State” to include “For purpose of section 2303 and chapters 34 and 35 of this title, such term also includes the Canal Zone.” To correct this omission, Start Printed Page 71056we propose to revise the definition of “State” in proposed § 5.1 to include the Canal Zone “for purposes of 38 U.S.C. 101(20), and 38 U.S.C. chapters 34 and 35”.

We propose to add a definition of “VA”, as § 5.1, that is consistent with current 38 CFR 1.9(b)(1) and 38 U.S.C. 101.

Regarding our initially proposed definition of “willful misconduct”, an AM05 commenter suggested revising the last sentence of initially proposed § 5.661(a)(1) from, “A mere technical violation of police regulations or other ordinances will not by itself constitute willful misconduct”, to, “A mere technical violation of police regulations or any local ordinances, including those under police, city or county authority, will not by itself constitute willful misconduct.” Another commenter expressed the opinion that the use of the word “other” before the word “ordinances” may be misunderstood to refer to a state's general police power to make and enforce laws. We propose to clarify the rule based on these comments for the reasons discussed below.

The definition of “ordinance” includes city or county authority. The word “ordinance” is defined as, “An authoritative law or decree; esp., a municipal regulation.” “Black's Law Dictionary” 1208 (9th ed. 2009). “Municipal” is defined as, “1. Of or relating to a city, town or local government unit. 2. Of or relating to the internal government of a state or nation.” Id. at 1113.

In most municipalities, the police department establishes regulations relating to parking, street usage, and other similar civil issues. The use of the phrase “police regulations” is intended to express the idea that a violation of these types of regulations will not be used as the grounds for a finding of willful misconduct. Violations of these regulations are “civil infractions”. An “infraction” is “[a] violation, usually of a rule or local ordinance and usually not punishable by incarceration.” “Black's Law Dictionary” 850 (9th ed. 2009). A civil infraction is “An act or omission that, though not a crime, is prohibited by law and is punishable.” Id. Since that term is not readily understood by most of the general public, parenthetical explanations following the use of the term will clarify the meaning for most people. We propose to revise the last sentence of what was initially proposed § 5.661(a) to read, “Civil infractions (such as mere technical violation of police regulations or other ordinances) will not, by themselves, constitute willful misconduct.” We are proposing to make this change to ensure that civil infractions, while prohibited by law, do not by themselves deprive an otherwise entitled veteran to benefits. We now propose to incorporate this provision into § 5.1.

The second sentence of initially proposed § 5.661(a)(2) read: “For example, injury, disease, or death is proximately caused by willful misconduct if the act of willful misconduct results directly in injury, disease, or death that would not have occurred without the willful misconduct.” We have determined that this statement is unnecessary because § 5.1 already defines “proximately caused”, so we propose to remove the example.

One commenter expressed the opinion that a VA determination of “willful misconduct” is a quasi-criminal determination. This commenter stated that the preponderance of the evidence standard is not appropriate in adjudicating a quasi-criminal determination. The commenter asserted that the preponderance of the evidence standard of proof for willful misconduct determinations was too low because a determination of willful misconduct essentially bars a veteran or claimant from receiving benefits based on the veteran's service. The commenter asserted that this deprived the veteran or claimants claiming entitlement based on a veteran's service of procedural due process under the Fifth Amendment to the U.S. Constitution. The commenter expressed the opinion that VA should instead establish the clear and convincing evidence standard as the standard of proof in making willful misconduct determinations. The commenter noted that the U.S. Supreme Court has stated that a principal function of establishing a standard of proof is “to allocate the risk of error between the litigants and to indicate the relative importance attached to the ultimate decision.” Addington v. Texas, 441 U.S. 418, 423 (1979).

The commenter acknowledged that VA had adopted the standard of proof articulated by the U.S. Court of Appeals for the Federal Circuit (Federal Circuit) in Thomas, 423 F.3d 1279. The commenter also noted that VA has the authority to adopt a different standard notwithstanding the standard adopted by the Federal Circuit, as explained by the Supreme Court in Nat'l Cable & Telecomms. Ass'n v. Brand X Internet Servs., 545 U.S. 967, 969-70 (2005) (finding that an agency could, through publication of a regulation, adopt an interpretation of a statute that was different than the interpretation of the same statute made by a court if the statute was ambiguous and the court's interpretation was not the only permissible interpretation of the statute).

The commenter noted that the Federal Circuit found in Thomas that the statute did not contain a standard of proof and that VA had not, by regulation, imposed a standard of proof. See 423 F.3d at 1283-84. The Federal Circuit then found that the Board's and the U.S. Court of Appeals for Veterans Claims' decisions to apply the preponderance of the evidence standard were supported by their stated reasons and bases. Id. at 1284-85. The commenter noted that the Nat'l Cable & Telecomms. Ass'n Court found that even if a court has established a standard of proof as a gap-filling measure, an agency may still establish a different standard of proof to fill gaps in a statute by regulation if the agency decides that the court's determination of a standard of proof is not in accordance with the agency's policies or does not align with the agency's perception of Congressional intent.

VA does not equate administrative willful misconduct determinations with quasi-criminal proceedings and decisions. VA administrative procedures for determining entitlement to benefits are non-adversarial and pro-claimant, in contrast to criminal proceedings. Attempts to categorize the administrative entitlement decisions made by VA as quasi-criminal proceedings characterize both the claimants and the VA administrative process incorrectly. While the commenter does not fully explain what was meant by “quasi-criminal” proceedings, we note that unlike criminal proceedings, VA has no authority under these regulations to fine, imprison, or otherwise impose punishment on a claimant. VA administratively decides entitlement to benefits in accordance with the duly enacted statutes of Congress. We do not follow the procedures used in either criminal or civil courts.

A decision that a disability was the result of willful misconduct only prohibits service connection for the disability or death incurred as a result of the willful misconduct. Contrary to the commenter's assertion, a veteran or a claimant claiming entitlement based on a veteran's service does not lose entitlement to all benefits. A decision that willful misconduct caused a disability results in essentially the same consequences as a decision that an injury or disease was not incurred in service. Service connection for that disability or death is not granted. In making a determination that the Start Printed Page 71057disability was due to willful misconduct, the veteran or a claimant claiming entitlement based on a veteran's service is notified of the information or evidence needed to substantiate the claim, of the decision on the claim, and of their appellate rights.

Additionally, there is no violation of the Fifth Amendment through application of the preponderance of the evidence standard to willful misconduct decisions. Since the commenter merely asserted a violation of the Fifth Amendment without explaining how the use of any one particular standard of proof could violate the due process provision of the Fifth Amendment, we are unable to respond more fully to this comment and propose to make no changes based on this comment.

VA does not need to decide if the commenter's reasoning concerning adoption of a standard of proof differing from that found by the court in Thomas is correct. After reviewing the various standards of proof, we have determined that the preponderance of the evidence standard is the appropriate standard of proof to prove willful misconduct, except as otherwise provided by statute. We provided our reasons for selecting this standard of proof in the NPRM that proposed this segment of part 5. See 71 FR 16470, Mar. 31, 2006. The preponderance of the evidence standard provides that if the evidence demonstrates that it is more likely than not that a fact is true, the fact will be considered proven. This is an appropriate standard to apply to the administrative decisions we propose to make in connection with veterans' benefits.

We propose to move the definitions of “accrued benefits”, “claim for benefits pending on the date of death”, and “evidence in the file on the date of death” from § 5.550 to § 5.1. A comment to RIN 2900-AL71 “Accrued Benefits and Special Rules Applicable Upon Death of a Beneficiary”, raised questions concerning the initially proposed definition of “accrued benefits”. Based on that comment, we made technical revisions to clarify the definition, and also made the following revisions.

The last sentence of initially proposed § 5.550(d) (definition of ”[c]laim for benefits pending on the date of death”) read, “[a]ny new and material evidence must have been in VA's possession on or before the date of the beneficiary's death.” One commenter, responding to RIN 2900-AL71 “Accrued Benefits and Special Rules Applicable Upon Death of a Beneficiary”, suggested that VA should clarify this sentence by inserting the phrase “used to reopen the claim” between the words “evidence” and “must”. The commenter was concerned that the proposed language would deter a deceased beneficiary's survivor from filing existing additional evidence in support of a claim for accrued benefits. However, because a claim for accrued benefits must be granted based on evidence in the file on the date of death, such additional evidence would not be considered in deciding the claim. Nevertheless, to avoid any potential confusion we propose to add “submitted to reopen the claim” between “evidence” and “must”. We propose to use “submitted” rather than “used” because the later implies that VA will always find that the evidence was new and material.

We made additional revisions to the definition of “claim for benefits pending on the date of death” for both readability and consistency purposes. One such revision is that we replaced the initially proposed term “finally disallowed claim” with “finally denied claim” and reorganized the sentence structure with respect to new and material evidence.

§ 5.2 Terms and Usage in Part 5 Regulations

38 CFR part 3 uses both singular and plural nouns to refer to a single, regulated person. For example, § 3.750(b)(2) refers to “a veteran with 20 or more years of creditable service”, while § 3.809(a) refers to “veterans with wartime service” (emphasis added). This inconsistent usage could confuse readers so we propose to use only singular nouns to refer to a particular regulated person. We propose to state in previously reserved § 5.2 that a singular noun that refers to a person is meant to encompass both the singular and plural of that noun. For example, the term “a surviving child” would apply not only to a single surviving child, but also to multiple surviving children. Where a provision is meant to apply only to a group of people (for example, the division of benefits between a surviving spouse and children), we will indicate this by using a plural noun to refer to the regulated group of people. Similarly, we will use a plural noun when referring to a specific, identified group of people. See, for example, § 5.27, “Individuals and groups designated by the Secretary of Defense as having performed active military service.”

§ 5.3 Standards of Proof, and Comments on Definitions of Evidentiary Terms

One commenter suggested that VA should include additional definitions in § 5.1. The commenter suggested that “evidence” should be defined as “all the means by which any alleged matter of fact, the truth of which is submitted to an adjudicator, is established or disproved.” The commenter went on to state that, “Evidence includes the testimony of witnesses, introduction of records, documents, exhibits, objects, or any other probative matter offered for purpose of inducing a belief in the contention by the fact-finder” and that, “evidence is the medium of proof”. The commenter opined that defining “evidence” would assist an unrepresented claimant in understanding the term and would inform claimants that some materials he or she submitted would not be evidence (such as arguments, assertions, and speculations).

This commenter asserted that after we define “evidence”, we should define “relevant evidence” and “probative evidence”, as follows:

Relevant evidence means evidence having any tendency to make the existence of any fact that is of consequence to the determination of the matter more probable or less probable than it would be without the evidence.

Probative evidence is evidence that tends to prove a particular proposition or to persuade a trier of fact as to the truth of an allegation.

The commenter asserted that this would enable the claimants to understand what evidence should be submitted in order for the claimants to succeed with their claims for benefits.

We propose to make no changes based on these comments. We do not believe that there is a significant need to define the referenced terms, and there is some risk that such definitions would be misinterpreted as limiting the types of items a claimant may file or that VA will consider. Except as to claims based on clear and unmistakable error, VA is required to consider all material filed. See 38 U.S.C. 5107(b) (“The Secretary shall consider all information and lay and medical evidence of record in a case”). Defining “evidence” as suggested might discourage claimants from filing arguments or other information and statements.

The dictionary definition of “evidence” is “something that furnishes proof.” “Merriam-Webster's Collegiate Dictionary” 433 (11th ed. 2006). VA does not use the word in a manner different from this ordinary or natural definition: “When a word is not defined by statute, we normally construe it in accord with its ordinary or natural meaning.” Smith v. United States, 508 U.S. 223, 228 (1993). This concept applies equally to regulations. Thus, it is not necessary to define words used in a regulation when the words are used in Start Printed Page 71058accord with their ordinary or natural meaning. The commenter's suggested definitions of “credibility”, “determination”, “material”, “matter”, “proof”, and “testimony” are likewise not needed.

The suggested definitions of “relevant evidence” and “probative evidence” are also not necessary. As explained below, the definition of “competent evidence” will be helpful to claimants because VA may in individual cases inform the claimant of the need for competent medical expert evidence on some issues. However, definitions that appear to delineate other categories of evidence, such as “relevant evidence” and “probative evidence” may be confusing to claimants and appear to suggest restrictions on the types of evidence claimants may file or that VA will consider. It is generally to the claimants' advantage to file all information and evidence they have that have potential bearing upon the issues in their claim. Introducing definitions of “relevant evidence” and “probative evidence” might create confusion and discourage claimants from filing all information and evidence that they might otherwise file.

The same commenter urged VA to adopt a certain definition of the term “probative value of evidence”, namely “the tendency, if any, of the evidence to make any fact of consequence in the determination of the matter more or less probable than it would be without the evidence.” However, the commenter did not specifically state why VA should adopt a definition of that term, but focused instead on the suggestion that VA define the distinct but related term “probative evidence”. For the same reasons that we propose not to define “probative evidence”, we propose not to define “probative value of evidence”.

This commenter also suggested we adopt a definition of the word “issue” as “a single, certain point of fact or law that is important to the resolution of a claim for veterans' benefits.” The commenter noted that this word is used in 38 U.S.C. 5107(b). The commenter opined that because Congress used this word in the statute, we must define the word. The commenter similarly opined that § 5.3(b), “Proving a fact or issue”, is confusing because we did not define the word “issue” in § 5.1. The commenter suggested that we used the words “issue” and “fact” as unrelated concepts. The commenter then reasoned that, since the statute did not use the word “fact”, VA may not have authority to include that word in the regulations, noting the canon of “expressio unius est exclusio alterius” (“to express or include one thing implies the exclusion of the other, or of the alternative”, “Black's Law Dictionary” 661 (9th ed. 2009)).

The commenter is correct that the word “issue” is used in 38 U.S.C. 5107(b), but the word is also used in other places in title 38, often with a different meaning. See, for example, 38 U.S.C. 5112(b)(6) and 5110(g). The word “issue” is used within part 5 with at least three different meanings. See, for example, §§ 5.82(d), 5.103(e), 5.133(b), and 5.152. VA's policy is to broadly interpret 38 U.S.C. 5107(b), such that the benefit of the doubt applies both to the ultimate “issue” in a case (for example, whether to award benefits) but also to individual issues of material fact (for example, whether a particular event occurred). Therefore, we propose to revise §§ 5.1 and 5.3 to refer, where appropriate, to both questions of fact and the resolution of issues.

The same commenter urged VA to adopt a definition of the term “presumption”. In § 5.260(a) of our proposed rule, “Presumptions of Service Connection for Certain Disabilities, and Related Matters”, we clearly described the meaning of the term in the veterans benefits context: “A presumption of service connection establishes a material fact (or facts) necessary to establish service connection, even when there is no evidence that directly establishes that material fact (or facts)”. 69 FR 44624, July 27, 2004. We therefore propose to make no changes based on this comment.

The same commenter urged VA to adopt a definition of “rebuttal of a presumption”. Section 5.3(c), which states, “A presumption is rebutted if the preponderance of evidence is contrary to the presumed fact”, in effect defines the term already so we decline to make any changes based on this comment.

The same commenter urged VA to adopt a definition of “weight of [the] evidence”, a term which was used in initially proposed § 5.3(b)(1) and (3). We agree that such a definition would be helpful to readers and we therefore propose to add the following definition in § 5.3(b)(1), “Weight of the evidence, means the persuasiveness of some evidence in comparison with other evidence.” “Black's Law Dictionary” 1731 (9th ed. 2009). With this addition, initially proposed paragraphs (b)(1) through (5) are redesignated as paragraphs (b)(2) through (6), respectively.

One commenter noted that 38 U.S.C. 5107(b) contains the language “approximate balance of positive and negative evidence” and that the regulation that VA proposed to adopt to implement section 5107(b) did not attempt to give any meaning to the statutory terms “positive and negative evidence”. The commenter asserted that these two statutory terms have known “legal” meaning and that VA must define “positive evidence” and “negative evidence” in order to give full force and effect to section 5107(b).

We did not define the terms “positive evidence” and “negative evidence” in initially proposed § 5.1 because we did not use those terms in initially proposed § 5.3(b)(2), which implements section 5107(b). Instead, we described “evidence in support of” and “evidence against” a matter. This interpretation of the statute is consistent with the clear and unambiguous meaning of the statute. See, for example, Ferguson v. Principi, 273 F.3d 1072, 1076 (Fed. Cir. 2001) (holding that section 5107(b) is “unambiguous” and upholding a decision not to apply the benefit-of-the-doubt-rule to a case where “there was more credible evidence weighing against the claim than supporting the claim”). We propose to make no changes based on this comment.

In § 5.3(a), we propose to revise the first sentence of the initially proposed paragraph by adding “material to deciding a claim”. In response to various comments concerning this proposed regulation, we noted that while we had adequately stated the general standards for proving facts and resolving issues, we had not included the reason for proving a fact.

Also in initially proposed § 5.3(a), “Applicability”, we stated, “This section states the general standards of proof for proving facts and for rebutting presumptions. These standards of proof apply unless specifically provided otherwise by statute or a section of this part.” In reviewing the initially proposed paragraph, we have decided to clarify that “a section” means another section besides § 5.3. We therefore propose to change “a section” to “another section”.

Initially proposed § 5.3(b)(1) (now § 5.3(b)(2)) stated, “Equipoise means that there is an approximate balance between the weight of the evidence in support of and the weight of the evidence against a particular finding of fact, such that it is as likely as not that the fact is true.” One commenter objected to the use of the word “equipoise” in § 5.3(b). The commenter noted that this word does not appear in 38 U.S.C. 5107(b), “Claimant responsibility; benefit of the doubt”. The commenter expressed the opinion that VA should remove this word and its definition and replace the word and definition with the exact language used in 38 U.S.C. 5107(b). The commenter Start Printed Page 71059noted that “in attempting to define the meaning of the term `equipoise', the initially proposed regulation states that equipoise means there is an `approximate balance between the weight of the evidence in support of and the weight of the evidence against a particular finding of fact, such that it is as likely as not that the fact is true.' ” The commenter felt that by omitting the word “equipoise” and its definition, VA would avoid confusion and be consistent with the governing statute.

We propose to make no changes based on this comment. It is not necessary to use the exact language Congress used in drafting a statute in the wording of the regulations we promulgate. The Secretary has been directed by Congress to “prescribe all rules and regulations which are necessary or appropriate to carry out the laws administered by the Department.” 38 U.S.C. 501(a). We chose to use the word “equipoise” because as used and defined in § 5.3, it is a clear and concise term and has the same meaning as traditionally applied to the phrase used in 38 U.S.C. 5107(b), “approximate balance of positive and negative evidence”. Our use of this word is consistent with the governing statute.

Another commenter asserted that our definition of “equipoise” in initially proposed § 5.3(b)(1) (now § 5.3 (b)(2)) accurately restates the third sentence of § 3.102, but fails to accurately restate the second sentence, which emphasizes and makes clear that the balances are always to be resolved in favor of the veteran. The same commenter felt that the sentence in initially proposed § 5.3(b)(2) (now § 5.3(b)(3)) that read, “However, if the evidence is in equipoise and a fact or issue would tend to disprove a claim, the matter will not be considered proven”, contradicts the benefit of the doubt rule because the rule must “always be applied in favor of the veteran”. We propose to clarify the statement of the benefit of the doubt rule by revising the first sentence § 5.3(b)(3) to now state, “When the evidence is in equipoise regarding a particular fact or issue, VA will give the benefit of the doubt to the claimant and the fact or issue will be resolved in the claimant's favor.”

In reviewing initially proposed § 5.3(b)(1) (now § 5.3(b)(2)), we have determined that the phrase “such that it is as likely as not that the fact is true” might cause a reader to mistakenly believe that this is an additional requirement for triggering the “reasonable doubt” doctrine, over and above the requirement that there be an “approximate balance between the weight of the evidence in support of and the weight of the evidence against a particular finding of fact”. We therefore propose to remove the language “such that . . .” from this paragraph.

One commenter urged VA to use the current language of 38 CFR 3.102 in proposed § 5.3(b)(2). The commenter asserted that the use of the term “equipoise” in initially proposed § 5.3(b)(2) is adversarial and that the proposed rule would “restrict [veterans'] ability to put forth the best evidence and challenge the credibility [of] evidence which the VA accepts or denies.”

As discussed in the preamble to the NPRM, we are not substantively changing the provisions in current § 3.102. Instead, we are rewording and reorganizing them to make them easier for the reader to understand. We disagree that the changes described in the NPRM and in this rulemaking make these provisions adversarial, and we therefore propose to make no changes based on this comment.

Although we decline to make the changes to initially proposed § 5.3(b)(2) (now § 5.3(b)(3)) suggested by the commenter, in reviewing the first two sentences of that paragraph, we have determined that they can be clarified. Specifically, the initially proposed sentences could be misread to imply that evidence can be in equipoise regarding an issue and at the same time tend to prove or disprove a claim. As stated in 38 CFR 3.102, where the evidence is in equipoise, it “does not satisfactorily prove or disprove the claim”. We therefore propose to remove the potentially confusing language regarding “support” of a claim and “tend[ing] to disprove a claim”, and combined the two sentences into one. The new sentence now reads, “When the evidence is in equipoise regarding a particular fact or issue, VA will give the benefit of the doubt to the claimant and the fact or issue will be resolved in the claimant's favor.”

One commenter noted that the sentence in initially proposed § 5.3(b)(3) (now (b)(4)) lacked parallelism. We agree and propose to change the wording by adding the words “the weight of” before the words “the evidence against it.”

One commenter objected to the sentence in initially proposed § 5.3(b)(5) (now § 5.3(b)(6)): “VA will reopen a claim when the new and material evidence merely raises a reasonable possibility of substantiating the claim.” This commenter asserted that the “reasonable possibility of substantiating the claim” portion could be read by an adjudicator as requiring sufficient evidence to grant the claim. This commenter suggests adding language to ensure that the adjudicator does not equate the new and material evidence requirement to the evidence requirements needed to grant the claim.

We disagree that a VA decisionmaker would apply this sentence as requiring that the new and material evidence to reopen a claim also be sufficient to grant the claim. To the contrary, when read in conjunction with initially proposed § 5.3 (b)(2) (now § 5.3 (b)(3)), “Benefit of the doubt rule”, this sentence makes it very clear that a lower standard of proof is applied for reopening a claim than for granting a claim. We therefore propose to make no changes based on this comment.

One commenter objected to the general format of initially proposed § 5.3(b)(5) (now § 5.3(b)(6)) because the commenter asserted that there was a lack of emphasis on the different standard of proof used to determine whether evidence is new and material. The commenter asserted that the last sentence of the paragraph should be rewritten and moved to the front of the paragraph to add emphasis to the concept that the higher standard of proof does not apply when determining if the evidence is new and material.

We agree and we propose to change the sentence to read, “The standards of proof otherwise provided in this section do not apply when determining if evidence is new and material, but do apply after the claim has been reopened.” We propose to place this sentence as the first sentence of that paragraph, now designated as § 5.3(b)(6), to add emphasis to this provision.

One commenter noted that in § 5.3(c), we stated that, “A presumption is rebutted if the preponderance of evidence is contrary to the presumed fact.” The commenter stated that in 38 U.S.C. 1111, the evidence to rebut the presumption of sound condition when accepted and enrolled for service is specified as clear and unmistakable evidence, a standard higher than a preponderance of evidence. The commenter recommended inserting the phrase “Except as otherwise provided” at the beginning of the section.

We agree that the standard in § 5.3(c) applies to rebutting presumptions unless an applicable statute provides a different standard, such as in the example provided by the commenter. However, we already provided for the application of different standards in § 5.3(a) by stating, “These standards of proof apply unless specifically provided otherwise by statute or a section of this part.” Since the regulations already address the point raised by the Start Printed Page 71060commenter, we propose to make no changes based on this comment.

Several commenters noted that under 38 U.S.C. 1113(a), a presumption can be rebutted only when “there is affirmative evidence to the contrary.” The commenters stated that the “affirmative evidence” requirement should be inserted into § 5.3(c). We disagree with the commenters. There are many statutes that govern the rebuttal of presumptions, see, for example, 38 U.S.C. 1111, 1132, and 1154(b), but the “affirmative evidence” requirement of section 1113(a) affects only presumptions related to diseases that are covered by proposed § 5.260(c). (We note that section 1113 does not affect the ALS presumption, which is also covered by § 5.260(c)). Hence, the affirmative evidence requirement appears in § 5.260(c), but not in the general rule that applies except as provided otherwise.

We agree with these assertions to the extent that we should retain the phrase “affirmative evidence” and propose to revise § 5.260(c)(2) to include the phrase “affirmative evidence”. We propose to revise § 5.260(c)(2), by replacing “Any evidence . . .” with “Affirmative evidence” in the beginning of the sentence. We also note that 38 U.S.C. 1116(f) requires “affirmative evidence” to rebut the presumption of exposure to herbicides in the Republic of Vietnam and so we now propose to insert that term into § 5.262(d).

We also propose to revise § 5.3(c) by adding a second sentence after the first sentence, that states, “In rebutting a presumption under § 5.260(c)(2), affirmative evidence means evidence supporting the existence of certain facts.” We have chosen this definition instead of one of the definitions recommended by the commenters because this is consistent with the definition of “affirmative” found in “Black's Law Dictionary”, 68 (9th ed. 2009).

In a related matter, comments on both RIN 2900-AL87, “General Provisions”, 71 FR 16464, Mar. 31, 2006, and on RIN 2900-AL70, “Presumptions of Service Connection for Certain Disabilities, and Related Matters”, 69 FR 44614, July 27, 2004, indicated the need for our rules to address the role of “negative” evidence, by which we mean an absence of evidence. An absence of evidence may be considered as evidence in support of, or weighing against, a claim. For example, an absence of evidence of signs or symptoms of a particular disability prior to service would support a veteran's claim that he incurred the disability during service. On the other hand, a lack of symptoms or complaints during service may indicate that the veteran was not disabled during service. An absence of evidence may also be used to rebut a presumption. The U.S. Court of Appeals for the Federal Circuit endorsed this view. Maxson v. Gober, 230 F.3d 1330 (2000) (holding that VA may properly consider a veteran's entire medical history, including absence of complaints, in determining whether presumption of aggravation is rebutted). This evidence is generally one of the weaker forms of evidence, but it is nevertheless important to recognize the role that it may play in certain cases, particularly where there is little evidence to support a claim. Hence, we propose to add § 5.3 (e), which states, “VA may consider the weight of an absence of evidence in support of, or against, a particular fact or issue.”

One commenter expressed concern about how a VA decisionmaker would read § 5.3(d), “Quality of evidence to be considered”, in conjunction with § 5.1 that defines “competent lay evidence”. The commenter asserted that if he or she determined that the evidence did not fit within the definition of competent lay evidence or that lay evidence is generally not competent, he or she would be more likely to assess the evidence as adverse to the veteran.

The commenter's assumption is incorrect. Competent lay evidence may be neutral or may be favorable to the claimant. Such evidence may also be probative, depending on the claim to be adjudicated. We also do not agree that a VA decisionmaker would determine that lay evidence was generally not competent. We have provided for the determination of what makes lay evidence competent in the definition in proposed § 5.1. A VA decisionmaker's application of these provisions will lead the adjudicator to determine what is competent lay evidence and what is not. We propose to make no changes based on this comment.

In objecting to our initially proposed definitions of “competent expert evidence” and “competent lay evidence”, one commenter wrongly asserted that there are no such definitions in current VA regulations. In fact, as stated in the preamble of RIN 2900-AL87, these definitions are based on similar definitions in 38 CFR 3.159(a)(1) and (2).

The same commenter asserted that defining competent evidence would “cause the claims of veterans to be pre-judged by adjudicators and foster an adversarial climate in the claims process.” The commenter urged that, “Rather, all the evidence of record in each case should be judged on its own merits, and on the merits of the case as a whole.”

The commenter did not explain how our definitions of “competent expert evidence” and “competent lay evidence” have the adverse effects he predicts, and we disagree that they would have such effects. VA has applied substantially similar definitions since 2001. 38 CFR 3.159(a)(1) and (2); see 66 FR 45630, Aug. 29, 2001. These definitions have not caused any such adverse effects, and the changes we are making to the definitions in § 5.1 will not either. We therefore propose to make no changes based on this comment.

One commenter expressed concern that by changing the definitions of “competent medical evidence” to “competent expert evidence” and “competent lay evidence” we were impermissibly amending § 3.159, “Department of Veterans Affairs assistance in developing claims.” The commenter expressed the concern that since these terms were originally adopted as part of that regulation, a change in the definitions would amend § 3.159 without providing public notice and the opportunity for public comment as required by 5 U.S.C. 553.

The commenter's concerns relate to the removal of part 3 when we adopt part 5. This rulemaking will not affect such a removal; nor will this rulemaking affect claims currently being adjudicated under part 3. The definitions in § 5.1 only apply to part 5, not to part 3. Hence, there is no basis for a concern that any action in this rulemaking will affect a part 3 rule.

One commenter opined that the definitions of “competent expert evidence” and “competent lay evidence” should be revised since neither definition focused on the relevance of the evidence. The commenter also asserted that neither definition correctly described “competent expert evidence” or “competent lay evidence”. The commenter believed that treatises, medical or scientific articles, and other writings are not “competent expert evidence” because they are not based on the author's personal knowledge of the specific facts of the veteran's particular case.

Although we do not agree with the suggestion that treatises, medical and scientific articles, and other writings of this type may never be “competent expert evidence”, the commenter raises a valid point. Treatises and similar writings may be “competent” in the sense that they state findings and opinions based on specialized training or experience and personal knowledge Start Printed Page 71061of the facts on which such findings and opinions are based. However, it is misleading to equate treatises and similar writings with the types of expert evidence ordinarily provided in VA benefit claims. That is because medical treatises ordinarily recite facts or opinions derived apart from a particular veteran's case and thus are not based on personal knowledge of the facts of the veteran's case. The U.S. Court of Appeals for Veterans Claims has noted that treatise evidence is often too general or speculative to provide significant evidence concerning the cause of a particular veteran's disability. See Sacks v. West, 11 Vet. App. 314, 316-17 (1998). Citing treatises as an example of competent expert evidence may mislead claimants to the belief that such treatises are the equivalent of medical opinions based on the specific facts of their case. While treatise evidence may in some situations be probative of the fact to be proved, and must always be considered by VA when presented in a case, we do not consider it helpful to cite such writings as representative examples of competent expert evidence. Thus, we propose to revise the definition as urged by the commenter by removing the reference to treatise evidence in the definition of “competent expert evidence”.

We propose not to revise the definitions to include a statement concerning the relevancy of the evidence. The relevance of the evidence depends on the facts in each case and is to be determined on a case-by-case basis by the VA employee charged with making the decision on the claim.

One commenter urged VA to define “competent evidence” in part 5 as, “evidence that has any tendency to make the existence of any fact that is of consequence to the determination of the matter more probable or less probable than it would be without the evidence.”

This suggested definition is actually more a definition of “probative evidence” than “competent evidence”. In fact, this same commenter urged VA to define “probative evidence” as “evidence that tends to prove a particular proposition or to persuade a trier of fact as to the truth of an allegation.” Since the suggested definition of competent evidence concerns evidence's probative value rather than its competence, we propose to make no changes based on the comment.

In our initially proposed definition of competent expert evidence, we stated, “Expert evidence is a statement or opinion based on scientific, medical, technical, or other specialized knowledge.” We propose to add “all or in part” after “based” because an expert opinion may also be based on the specific facts of a case. An example of such an opinion would be a doctor's opinion that general medical principles indicate that a particular injury would not likely have been aggravated under the facts of a particular case. See Emenaker v. Peake, 551 F.3d 1332, 1335-37 (Fed. Cir. 2008).

The initial NPRM to § 5.3 explained why part 5 will not repeat the fifth sentence of § 3.102. 71 FR 16464 (Mar. 31, 2006). Section 5.3 would also not repeat the fourth sentence. It is unnecessary because, like the fifth sentence, it confusingly elaborates the idea of “approximate balance” of evidence, which 5.3(b)(2) through (5) do well without the confusing language of the fourth or fifth sentences of § 3.102.

§ 5.4 Claims Adjudication Policies

One commenter asserted that VA gives too much weight to medical exam reports prepared by VA doctors and insufficient weight to medical exam reports prepared by a veteran's own doctors. The commenter cited the example of VA giving more weight to the report of a VA doctor who examined him for less than an hour than to the medical records from his treating doctor covering a period of over 5 years. The commenter asserted that VA's over-reliance on its own medical exams is “VA policy” but is not “sound medical practice”. The commenter further asserted that when a VA medical exam is “poorly conducted and documented”, VA orders a second exam rather than rely on the treating doctor's records to decide the claim. The commenter urged VA to “establish a level of proof which meets the balance test of both patient history and proof of medical condition” and not rely on “an arbitrary, `snapshot' exam conducted in a VA hospital meaning more than years of records from the veteran's regular physician(s).”

We decline to make any changes based on this comment in the manner in which VA weighs medical evidence. VA often gives significant weight to an examination conducted, or a medical opinion provided by, a VA health care provider because they follow set procedures designed to elicit information relevant to the particular claim. However, as stated in 38 CFR 3.326(b), “Provided that it is otherwise adequate for rating purposes, any hospital report, or any examination report, from any government or private institution may be accepted for rating a claim without further examination.” Under 38 U.S.C. 5103A(d), VA must provide a medical examination or medical opinion in all disability claims when it is “necessary to make a decision on the claim”. Under this duty, VA regularly conducts specialized medical examinations of veterans' disabilities and often requests medical opinions on specific questions. If VA's adjudicator finds that such an exam or opinion is inadequate, he or she returns the case to the health-care provider and requests for an adequate one to be provided.

However, VA must also “consider all information and lay and medical evidence of record in a case”. 38 U.S.C. 5107(b). Another statute requires the Board of Veterans' Appeals to review appeals to the Secretary “based on the entire record in the proceeding and upon consideration of all evidence and material of record.” 38 U.S.C. 7104(a). This statute indicates that evidence is an element of a person's entire VA record. The statute prescribing that VA considers the “places, types, and circumstances” of a veteran's service when deciding a claim for service connection prescribes that VA consider “all pertinent lay and medical evidence”. 38 U.S.C. 5104(a). Although section 5104(a) could be interpreted to distinguish evidence from other documents in the record, VA regulations demonstrate that our actual practice is to review the entire record in every claim. The regulation implementing the benefit of the doubt rule of 38 U.S.C. 5107(b) provides for “careful consideration of all procurable and assembled data” and of “the entire, complete record”. 38 CFR 3.102. Therefore, in addition to considering VA medical exams and opinions, VA weighs and considers all other medical evidence, including that produced by a veteran's treating physician.

We note that 38 CFR 3.303(a) only prescribes that VA decide claims for service connection “based on review of the entire evidence of record” and there is no rule in part 3 that specifically implements 38 U.S.C. 5107(b). We therefore propose to add a new sentence at the beginning of § 5.4(b) stating, “VA will base its decisions on a review of the entire record.” We use the term “entire record” because it is unclear whether “entire evidence of record” means all of the evidence of record, or the entire record. The evidence in a VA claims file is only part of the entire record comprising the claims file. Our language resolves the ambiguity in favor of the more inclusive meaning, which is consistent with current VA practice. Because § 5.4(b) would clearly state that “VA will base its decisions on a review of the entire record”, we believe it would be redundant and possibly confusing to restate this principle in specific sections in part 5 (as does part Start Printed Page 710623). We therefore propose to remove such provisions from §§ 5.269(e), (f)(1) and (2), and 5.343. In order to incorporate the court's holding in Bell v. Derwinski, 2 Vet. App. 611 (1992), we propose to add the phrase “including material pertaining to the claimant or decedent, in a death benefit claim, that is within VA's possession and could reasonably be expected to be a part of the record” to the end of that sentence.

§ 5.5 Delegations of Authority

We propose to add § 5.5, “Delegations of authority”, to this initially proposed segment. This regulation was inadvertently not included in the initially proposed rule. These provisions are the same as § 3.100, “Delegations of authority”, reorganized to make them easier to read. We also propose to replace the § 3.100(a) language, “. . . entitlement of claimants to benefits under all laws administered by the Department of Veterans Affairs governing the payment of monetary benefits to veterans and their dependents . . .” with “entitlement to benefits under part 5”. We propose to make this change because part 5, like part 3, includes benefits which do not involve monetary payments. These include a grant of service connection for a veteran's disability rated 0 percent and certification of loan guaranty benefits for a surviving spouse. Lastly, we propose to omit the reference to the “Compensation and Pension Service” (used in § 3.100(a) and now subdivided into the “Compensation Service” and “Pension and Fiduciary Service”) is a subdivision of the Veterans Benefits Administration, and the reference is therefore unnecessary.

VII. Subpart B: Service Requirements for Veterans AL67

In a document published in the Federal Register on January 30, 2004, we proposed to amend VA regulations governing service requirements for veterans, to be published in a new 38 CFR part 5. See 69 FR 4820. The title of this proposed rulemaking was, “Service Requirements for Veterans” (RIN 2900-AL67). We provided a 60-day comment period that ended on March 30, 2004. We received submissions from four commenters: Disabled American Veterans, Vietnam Veterans of America, and two members of the general public.

§ 5.20 Dates of Periods of War

One commenter expressed satisfaction with the progress of the Regulation Rewrite Project and offered praise for proposed RIN 2900-AL67. The commenter was pleased with the inclusion of the Mexican Border Period in proposed § 5.20, “Dates of periods of war”, as there are veterans and dependents who may still be alive and eligible for benefits based on military service during this period.

While we appreciate the commenter's concern, because there are no veterans or surviving spouses of the Mexican Border Period on VA's compensation and pension rolls and only one surviving dependent (a child), we propose to delete the provisions related to this period of war and refer regulation users to the applicable statutory provisions concerning this earlier period of war. This deletion would not affect benefit entitlement in any way. Should the occasion arise, VA will adjudicate any new claim using the statutory definition of this earlier period of war. See 38 U.S.C. 101(30).

The table in § 5.20 was published as a proposed rule using the terms “armed forces” and “active military, naval, or air service”. For consistency, we propose to capitalize “Armed Forces” and change “active military, naval, or air service” to “active military service”.

§ 5.22 Service VA Recognizes as Active Duty

In our NPRM, we invited comments on “whether, and to what extent, VA should recognize military duty for special work as active duty for VA purposes.” 69 FR 4822, Jan. 30, 2004. One of the commenters urged that VA recognize active duty for special work. Subsequent to that publication, however, additional issues have arisen which require closer coordination than we previously anticipated between VA and the Department of Defense. When that coordination has been completed, we will publish a separate NPRM on the characterization of active duty for special work. Hence, we propose not to revise § 5.22 to address the recognition of active duty for special work.

§ 5.24 How VA Classifies Duty Performed by Armed Services Academy Cadets and Midshipmen, Attendees at the Preparatory Schools of the Armed Services Academies, and Senior Reserve Officers' Training Corps Members

Current 38 CFR 3.6(c)(4) refers to “deaths and disabilities resulting from diseases or injuries incurred or aggravated after September 30, 1982, and . . . deaths and disabilities resulting from diseases or injuries incurred or aggravated before October 1, 1982”. In initially proposed § 5.24(c)(1) (based on § 3.6(c)(4)), we proposed to replace the phrase “incurred or aggravated” with the term “that occurred”. Although it was not our intention, the use of “occurred” could be construed as narrowing the scope of the regulation by excluding aggravation. Therefore, we now propose to replace “that occurred” with “incurred or aggravated” in § 5.24(c)(1).

§ 5.27 Individuals and Groups That Qualify as Having Performed Active Military Service for Purposes of VA Benefits Based on Designation by the Secretary of Defense

The official names of groups of civilians who, pursuant to section 401 of Public Law 95-202, have been designated by the Secretary of Defense as having performed active military service for VA benefit purposes are listed alphabetically in proposed § 5.27(b).

Such groups apply for status as having performed active military service using group names that, as nearly as possible, precisely identify the members of the group and the service they want recognized. In fact, when a favorable determination is made, the Secretary's Federal Register notice is almost always phrased in terms of “service of the group known as”, followed by the group's official name.

In the NPRM, we initially proposed to revise some of the group names for clarity and readability. However, we have determined that this could cause confusion that a group other than the original was determined to have performed active military service. Such confusion can be avoided by strictly adhering to the official names of the groups, and we now propose to revise § 5.27(b) to reflect the original group names exactly as they were provided to VA by the Secretary of Defense.

§ 5.28 Other Groups Designated as Having Performed Active Military Service

In reviewing initially proposed § 5.28, we determined that we mistitled it. This section refers only to groups, not individuals and we have retitled it accordingly.

§ 5.31 Statutory Bars to VA Benefits

In initially proposed § 5.31(c)(4), we defined the acronym “AWOL” as “absence without official leave”. However, in the Uniform Code of Military Justice (10 U.S.C. 886) that particular offense is called “absence without leave”, and the word “official” is not used. Therefore, for purposes of consistency and clarity, we propose to delete the word “official” from § 5.31(c)(4).Start Printed Page 71063

§ 5.39 Minimum Active Duty Service Requirement for VA Benefits

Initially proposed § 5.39(c)(2) stated, “If it appears that the length of service requirement may not be met, VA will request a complete statement of service to determine if there are any periods of active military service that are required to be excluded under paragraph (e) of this section.” After reviewing this paragraph to respond to a public comment, we propose to correct a typographical error (by changing the reference to paragraph “(e)” to “(d)”) and to clarify the paragraph to improve readability.

In § 5.39(d)(4), we initially proposed to exclude any person who has a compensable disability under 38 U.S.C. chapter 11 from the minimum active duty requirement. A disability is compensable if VA rates it as 10 percent or more disabling according to the Schedule for Rating Disabilities in part 4 of this chapter. One commenter asserted that it would be wrong to discontinue the entitlement of a veteran who did not meet the minimum active duty requirements, but was awarded an initial temporary 100 percent rating under 38 CFR 4.29 or 4.30, which was subsequently reduced to a noncompensable (0 percent) rating. Likewise, any veteran lacking the minimum active duty requirements who had a compensable disability, but a subsequent decision reduced the rating to 0 percent, should not lose entitlement. This commenter agreed that disability ratings should fluctuate with the severity of the disability, but that eligibility, once established, should not be revoked in such cases.

Under 38 U.S.C. 5303A(b)(1), a person who initially enters service after September 7, 1980, must be discharged or released after completing 24 months of continuous active duty or the full period for which such person was called to active duty to be eligible for, or be entitled to, any benefit administered by VA based upon the length of active duty service. Section 5303A(b)(3)(C) excludes those persons from the minimum active duty service requirements who have a disability that the Secretary has determined to be compensable under chapter 11 of this title. Section 5.39(d)(4) clarifies the term “compensable” to include veterans receiving special monthly compensation under 38 CFR 3.350, as well as those receiving a 10 percent rating for multiple 0 percent disabilities under 38 CFR 3.324.

The commenter's position appears to be that once service connection has been established and a disability rating of 10 percent or more disabling has been assigned, a person is forever excluded from having to satisfy the minimum active duty service requirements. We cannot agree.

Under 38 U.S.C. 5303A, the minimum active duty service requirements must be satisfied in order for a person discharged or released from a period of active duty to be eligible for, or entitled to, any benefit based on that period of active duty, unless a person is a member of one of the excluded groups. Under section 5303A(b)(3)(C), a person “who has a disability that the Secretary has determined to be compensable under chapter 11 of this title” meets the minimum active duty service requirement. The statute uses the present tense, “has” when referring to that disability, which means the veteran trying to show that he or she qualifies under section 5303A(b)(3)(C) must currently have a compensable disability. We also note that the current regulation on this point, § 3.12a(d)(3), already requires a current compensable disability to qualify for this exclusion. Section 5.39 does not, in any way, change the scope of this exclusion. For these reasons, we propose not to make any changes on minimum active duty service requirements based on this comment.

Upon reviewing § 5.39(d)(4) in relation to this comment, we determined that it was appropriate to clarify the regulation consistent with the above discussion. We therefore propose to replace the phrase “VA determines to be” with “is currently” in this paragraph. This will ensure that readers understand that the regulation requires that a person have a currently compensable disability to qualify for the paragraph (d)(4) exclusion.

One commenter contended that 38 U.S.C. 5303A pertains only to those persons who are veterans by virtue of having served on active duty. This commenter asserted that a person, who obtained veteran status because an injury or disease was incurred or aggravated during active duty for training, or because an injury was incurred or aggravated during inactive duty training, is exempt from the provisions of section 5303A. The commenter alleged that the initially proposed rule does not clarify that these persons are not required to have a compensable disability to qualify for general benefits under title 38.

Upon a closer review of section 5303A and the definitions in 38 U.S.C. 101, we agree with the commenter. To be a veteran, a person must have “active military, naval, or air service”, referred to in part 5 as “active military service”. There are three types of service that qualify as active military service: (1) Service on active duty, (2) Service on active duty for training during which an injury or disease is incurred or aggravated, or (3) Service on inactive duty training during which an injury is incurred or aggravated, or during which the person suffers an acute myocardial infarction, a cardiac arrest, or a cerebrovascular accident. See 38 U.S.C. 101(24). Since section 5303A, by its terms, applies only to veterans who served on active duty, it does not apply to veterans who performed active military service under the provisions of § 5.21(a)(4) or (5). We therefore propose to revise initially proposed § 5.39(d) to add two other categories of persons excluded from the minimum active duty service requirements: Persons who performed active military service under the provisions of § 5.21(a)(4) or (5).

In reviewing initially proposed § 5.39 in relation to the comment discussed above, we discovered that we inadvertently omitted a phrase contained in current § 3.12a(b): “based on that period of active service”. To correct that omission, we propose to revise § 5.39(a) accordingly.

In initially proposed § 5.39, we included proposed paragraphs (f)(2)(iv) and (v). Based on our review of the proposed rule, we noted that this was a numbering error. Proposed paragraphs (f)(2)(iv) and (v) should have been numbered (f)(2)(iii) and (iv) respectively because the proposed regulation did not have a paragraph (f)(2)(iii). Instead, it mistakenly skipped from (f)(2)(ii) to (f)(2)(iv). We propose to correct this error.

Comments Outside the Scope of RIN 2900-AL67

One person commented with reference to RIN 2900-AL67. The comments related to the definition of “Service in the Republic of Vietnam”, and to the so-called Bluewater sailors. These comments are outside the scope of the proposed rule published under RIN 2900-AL67, but relate to another NPRM, RIN 2900-AL70. We discussed these comments together with the other comments received in connection with RIN 2900-AL70.

We also received a comment that was not directed at any particular proposed rule, but we thought it would be most appropriately addressed in this portion of the proposed rule. The commenter was concerned that National Guard full time active duty members were not considered veterans unless they were injured on duty.

The commenter is correct. Persons who serve full time in the National Start Printed Page 71064Guard under section 316, 502, 503, 504, or 505 of title 32 are on active duty for training and are not considered veterans under title 38, VA's controlling statutes, unless they are disabled by an injury or disease that was incurred or aggravated during such duty. If the law is clear and unambiguous, VA is bound by it. Congress has spoken clearly about who may be considered a veteran for VA purposes. See 38 U.S.C. 101(2) and (24). Under such circumstances, the commenter's only remedy would be a change of statutory law. No change in regulations can be made based on this comment.

Changes in Terminology for Clarity and/or Consistency

For the convenience of readers and for economy of language, we propose to spell out the full name of each VA program or benefit the first time we use it in any part 5 regulation, and to abbreviate it thereafter. For example, the death benefit payable to a surviving spouse, child, or dependent parent based on death in service or due to a service-connected disability is officially titled “dependency and indemnity compensation”. That benefit name is quite cumbersome when it is repeated several times within a regulation. The abbreviation or acronym “DIC” is much easier to use and improves the readability of a regulation. In order to use the acronym, we must first spell it out for the reader, and while we do not want to spell out the term every time we use it, neither do we want to spell it out once in part 5 or once in each subpart and force the reader to keep referring back to a definition that is remote from where the acronym is being used. To strike a balance we propose to spell out the official program name followed by the acronym in parentheses the first time the program name is encountered in a section and to use the acronym throughout the remainder of that section. This will apply to regulatory text only, and not to section titles. If we use the program title only once in a section, we would spell it out with no parenthetical abbreviation or acronym. We will apply this convention throughout part 5.

Lastly, we propose to standardize the words used in referring to VA's rating schedule, “the Schedule for Rating Disabilities in part 4 of this chapter”. For this subpart, the new term will replace the initially proposed language in § 5.39(d)(4)(i).

VIII. Subpart C: Adjudicative Process, General

VA Benefit Claims AM16

In a document published in the Federal Register on April 14, 2008, we proposed to revise VA regulations governing benefit claims. 73 FR 20136. We provided a 60-day comment period that ended June 13, 2008. We received submissions from two commenters: Center for Plain Language and a member of the general public.

One commenter criticized our use of the passive voice and overly long sentences in the initially proposed rulemaking. Based on this comment, we propose to revise all of the proposed regulations to use the active voice and shorter sentences whenever possible or appropriate.

In addition to the specific changes discussed below, we propose to revise the regulations proposed in NPRM, RIN 2900-AM16 to help improve clarity and consistency with other part 5 regulations.

§ 5.50 Applications VA Furnishes

Initially proposed § 5.50(a) stated, “Upon request in person or in writing, VA will furnish the appropriate application to a person claiming or applying for, or expressing intent to claim or apply for, benefits under the laws administered by VA.” Based on our review, we propose to remove “in person or in writing” because it is too restrictive. Claimants may also request applications using the telephone or email. We also propose to remove the phrases “or applying for” and “or apply for” because these phrases are redundant of “claiming” and “claim”. Moreover, they may cause a reader to mistakenly believe that we mean something different by the use of these different phrases.

We have defined “notice” in § 5.1. The definition applies to VA's duty to inform a claimant of something a certain way. We propose to revise the first sentence of proposed paragraph § 5.50(b) by replacing the word “notice” with “information” because use of “notice,” as so defined, would be inappropriate.

The term “dependent” as used in the initially proposed rule and in § 3.150 from which it derives referred to persons known to VA as the deceased veteran's dependents at the time of his or her death. The term “survivor” better meets the requirement to provide an application to persons with “apparent entitlement”, because it encompasses persons not known to VA as the veteran's dependent who could, nevertheless, be entitled to a death benefit. We therefore propose to revise initially proposed paragraph (b) by replacing the word “dependent” with the word “survivor”.

We also propose to revise paragraph (b) by replacing the word “forward” in the first sentence with “furnish” and replacing “for execution by or on behalf of” with “to”. As revised, the sentence states that, “VA will furnish the appropriate application to any survivor”. “Furnish” is a more accurate word for supplying the survivor an application and it is consistent with paragraph (a), which also uses the word “furnish”. The initially proposed rule stated that VA will forward the application “for execution by or on behalf of” a dependent. In this regulation, it is surplus to state that the application is “for execution”. Although VA provides applications so claimants can execute them, the rules about what to do with an application are more appropriate to the regulations about filing claims. In the same sentence, we have changed the general reference to “such benefits” to name the benefits that a dependent could possibly receive, for example, death pension or dependency and indemnity compensation.

Additionally, we propose to revise the phrase, “If it is not indicated”, which appeared at the beginning of the second sentence of the initially proposed rule, to read, “If the available evidence does not indicate”. This phrase more clearly states what records VA will review to determine if there is a potential accrued benefits claimant. In the same sentence, we have replaced “forward” with “furnish” for the reasons discussed above. We also propose to revise the last sentence of paragraph (b) to specifically describe the 1-year time limit for filing a claim for accrued benefits because it will be helpful to claimants.

In the NPRM, paragraph (c) implied that VA would not assist in a claim for disability or death due to hospital treatment, medical or surgical treatment, examination, or training. The initially proposed rule stated, in pertinent part, “VA will not forward an application for benefits under 38 U.S.C. 1151.” We believe that it is important to instead inform the reader that VA does not have an application for claims under 38 U.S.C. 1151. We therefore propose to revise paragraph (c) to clarify that a claimant may apply in any written form for disability or death benefits due to hospital treatment, medical or surgical treatment, examination, or training under the provisions of 38 U.S.C. 1151. VA does not have an application for such a claim. See § 5.53, Claims for benefits under 38 U.S.C. 1151 for Start Printed Page 71065disability or death due to VA treatment or vocational rehabilitation, for the requirements for filing a claim pursuant to 38 U.S.C. 1151.

Initially proposed § 5.50 repeated the cross reference to § 3.109(b) from the end of § 3.150. This cross reference is erroneous because § 3.109(b) does not apply to any deadlines for filing claims referenced in §§ 3.150 or 5.50. We therefore propose to remove this cross reference from § 5.50.

§ 5.51 Filing a Claim for Disability Benefits

Initially proposed § 5.51(a) stated, “An individual must file a specific claim in the form prescribed by the Secretary in order for disability benefits to be paid under the laws administered by VA.” We propose to replace the phrase “in order for disability benefits to be paid under the laws administered by VA” with “for VA to grant a claim for disability benefits”. This change clarifies that the provision applies not only to cases where VA grants monetary benefits, but also to cases where VA grants service connection and rates the disabilities as 0 percent disabling.

Subsequent to the publication of proposed § 5.51, section 502 of Public Law 112-154 (2012) amended 38 U.S.C. 5101 by adding a new paragraph which states that if an individual has not attained the age of 18 years, is mentally incompetent, or is physically unable to sign a form, a form filed under paragraph (1) for the individual may be signed by a court-appointed representative, a person who is responsible for the care of the individual, including a spouse or other relative, or an attorney in fact or agent authorized to act on behalf of the individual under a durable power of attorney. If the individual is in the care of an institution, the manager or principal officer of the institution may sign the form * * * The term `mentally incompetent' with respect to an individual means that the individual lacks the mental capacity—(A) to provide substantially accurate information needed to complete a form; or (B) to certify that the statements made on a form are true and complete. We propose to update § 5.51(a) to reflect this amendment.

§ 5.52 Filing a Claim for Death Benefits

Initially proposed § 5.52(a) stated, “An individual must file a specific claim in the form prescribed by the Secretary (or jointly with the Commissioner of Social Security, as prescribed by § 5.131(a)) in order for death benefits to be paid under the laws administered by VA.” Subsequent to the publication of proposed § 5.52, section 503 of Public Law 112-154 (2012) amended 38 U.S.C. 5105 by removing the requirement that the Secretary of Veterans Affairs and the Commissioner of Social Security jointly prescribe forms for use by survivors of members and former members of the uniformed services in filing application for benefits under chapter 13 of title 38 and title II of the Social Security Act. Section 503 also removed the requirement that each such form request information sufficient to constitute an application for benefits under both laws. Finally, section 503 also removed the requirement that such a claim be filed on a particular form by allowing it to be filed “on any document indicating an intent to apply for survivor benefits”. We proposed to include these statutory changes in § 5.52(a).

In response to the Center for Plain Language's comment about sentence length in initially proposed § 5.52, we propose to revise the regulation to be more concise. We propose to revise initially proposed paragraph (a) by changing “in the form prescribed” to “for death benefits by completing and filing the application prescribed”. See § 5.1, “Definitions”; compare definition of “application”, with definition of “claim”, § 5.1(k). The requirement to use a prescribed application to claim a death benefit is consistent with the authorizing statute, 38 U.S.C. 5101(a), and its current implementing regulation, § 3.152(a). Both statute and regulation incorporate by reference the requirement that the Secretary and the Commissioner of Social Security jointly prescribe an application for use at either agency to apply for certain benefits, and that the application constitutes a claim for both agency's benefits when filed with either agency. See 38 U.S.C. 5105; 38 CFR 3.153.

In Fleshman v. West, 138 F.3d 1429, 1431 (Fed. Cir. 1998), involving a claim for disability compensation, the Federal Circuit addressed whether the phrase “in the form” in section 5101(a) means “on a form”. The court distinguished between the phrases, citing § 3.153 pertaining to claims for death benefits as an example of a regulation that clearly requires the claimant to use a specific application by using the phrase “on a form prescribed”. Section 5.52(a) will implement the court's reasoning and make explicit VA's practice regarding claims for death benefits. The proposed change of language from “in the form prescribed” to “by completing and filing the application prescribed” is a clarifying change from § 3.152(a). We also propose to change the language in initially proposed paragraph (a) of § 5.52 from, “in order for death benefits to be paid under the laws administered by VA”, to, “for VA to grant death benefits”, to be consistent with § 5.51.

We propose to revise paragraph (b) by removing references to filing a claim for death compensation. This benefit is not available for new applicants, so it is not necessary to include death compensation provisions in part 5. As a result of this change, we propose to eliminate initially proposed (b)(1) and redesignate proposed (b)(2) and (3) as (b)(1) and (2), respectively. We propose to revise paragraph (b) to eliminate needless repetition of language common to initially proposed § 5.52(b)(2) and (3).

In initially proposed § 5.52(c)(4) and (5), we addressed the effective dates of a child's death benefits. These paragraphs referenced the claimant's requirement to timely submit evidence that VA requests and the consequence of failure to timely submit such evidence. The rules on timely submission of evidence are in § 5.136, “Abandoned claims”, derived from current § 3.158. We propose to remove these provisions from initially proposed § 5.52 because there is no need to repeat them. To make the regulations more concise and easier to use, we propose to combine the remaining portions of initially proposed paragraphs (c)(4) and (5) with paragraph (c)(3) and to cross reference the effective date rules by referencing § 5.696 in paragraph (c)(1) and referencing §§ 5.538 and 5.431 in paragraph (c)(3).

§ 5.53 Claims for Benefits Under 38 U.S.C. 1151 for Disability or Death Due to VA Treatment or Vocational Rehabilitation

We propose to remove the last sentence of initially proposed § 5.53, which stated, “Such communication may be contained in a formal claim for pension, disability compensation, or DIC, or in any other document.” The first sentence of the regulation states that VA may accept “any communication in writing” as a claim for benefits under 38 U.S.C. 1151. In light of that rule, the sentence we propose to remove is surplus; “any communication in writing” inherently includes one “contained in a formal claim”.

§ 5.54 Informal Claims

We propose to make several changes to initially proposed § 5.54. These changes will revise and reorganize the rule to be clearer and consistent with current VA practice.

Paragraph (a) defines an informal claim and states that the informal claim must be written. VA defines a “claim” as a “formal or informal communication Start Printed Page 71066in writing” (§ 5.1). Section 5.54(a) merely reiterates this requirement for clarity in the rule governing informal claims. See Rodriguez v. West, 189 F.3d 1351, 1354 (Fed.Cir. 1999) (VA defines “claim” as a formal or informal written communication, therefore “under the Department's regulations an informal claim application must be written”). We also propose to add a cross reference in proposed paragraph (c)(2) to § 5.56, “Report of examination, treatment, or hospitalization as a claim.” The reader should find it convenient to have a reference here to an alternative method of claiming certain benefits.

Initially proposed paragraph (a) also stated that “[a]ny communication or action” may be an informal claim for benefits. As the phrase is used in current § 3.155 from which it derives, any “action” that would be a claim for benefits would be a communication. Therefore, we propose to remove the phrase “or action” as superfluous.

Additionally, initially proposed paragraph (a) listed who may file an informal claim and stated certain conditions for persons other than the claimant to file the claim. We propose to move this list to paragraph (b) to distinguish the authority to file an informal claim from the required content of an informal claim. Readers should find it convenient to have in one place a list of persons who can file a claim and any conditions on that authority. Initially proposed paragraph (b), like 38 CFR 3.155(b), listed several types of representatives: agents, attorneys, and service organizations. Initially proposed paragraph (a) contained the term “authorized representative”, which we have moved into paragraph (b). Because “authorized representative” includes agents, attorneys, and service organizations, we propose to remove those terms from § 5.54.

Initially proposed paragraph (a) provided that a “duly authorized representative” may file a claimant's informal claim. We propose to remove the word “duly” from the phrase “duly authorized representative”. It is a superfluous legalism. A claimant has or has not authorized a representative. There is no such thing as an unduly authorized representative. Such a representative would simply not be authorized.

Initially proposed paragraph (b), like current § 3.155(b), imposed conditions on VA's acceptance of an informal claim when filed by certain organizations or persons. The regulation stated the rule negatively: “A communication . . . may not be accepted . . . if a power of attorney . . . was not executed at the time the communication was written.” We propose to restate the rule affirmatively in paragraph (b) after the term “authorized representative”. The restated rule will read, “if authorized before VA received the informal claim”. This proposed change would also clarify the timing of the authorization.

Initially proposed § 5.54(b), also like current § 3.155(b), required that a power of attorney from the listed parties “was . . . executed at the time the communication was written.” VA requires that it receive the executed power of attorney before it will act on a written communication from certain representatives as an informal claim. In current practice, VA accepts as an informal claim a written communication from one of the listed representatives if it meets the requirements of an informal claim and VA receives it along with a power of attorney executed as regulation requires. “At the time the communication was written” is ambiguous. It could mean the power of attorney was executed simultaneously, more or less contemporaneously, or simply before the communication was written. VA has no mechanism to ascertain whether the power of attorney was executed at any of these times, nor need VA ensure the power of attorney was executed “at the time the communication was written.” VA is sufficiently assured of the authenticity of the power of attorney and of the authority of the representative to act for the veteran if VA receives a properly executed power of attorney and the communication the representative wrote for the claimant together.

Initially proposed § 5.54(b) contained a cross reference to 38 CFR 14.631, “Powers of attorney; disclosure of claimant information.” Because § 14.630, “Authorization for a particular claim”, also describes a type of authorized representative, we propose to add a cross reference to that section, too.

We propose to reorganize the elements of initially proposed paragraphs (a) and (c) that addressed the effect of filing an informal claim, combining them in paragraph (c). Paragraph (c)(1) applies to original informal claims. Initially proposed paragraph (a) provided that VA will “forward” an application to anyone who files an informal claim, but has not filed a formal claim. We propose to revise this to say that VA will “furnish an appropriate application to a person who files an informal claim”. This is consistent with § 5.50(a), which requires VA to furnish an “appropriate application” for a benefit upon request. VA does not have an application for all benefits. We propose to make paragraph (c)(1) practicable by limiting the requirement that VA “furnish an appropriate application” to those benefits for which VA has an application.

The initially proposed rule prescribed that VA would accept the date of receipt of an informal claim as the date of the claim, “If [the application is] received within 1 year after the date it was sent to the claimant”. We propose to add to paragraph (c)(1) that “VA will take no action on the informal claim until the claimant files the completed application.” Though the initially proposed language stating that VA forwards the application “for execution” implies that it must be returned executed (that is, completed), it is clearer to say so explicitly.

We propose to revise initially proposed paragraph (c) as paragraph (c)(2). We propose to remove “an informal request” and “will be accepted as a claim”. The revised regulation will prescribe VA's action upon receipt of an “informal claim” from a claimant who has previously satisfied § 5.51 or § 5.52, as did the initially proposed regulation. We propose to remove the term “informal request” for the same reason we propose to remove “action” from paragraph (a). Any “informal request” for an increase or to reopen must be a communication indicating “an intent to apply for one or more benefits”, that is, an informal claim. We propose to remove “will be accepted as a claim”, because to say that VA will accept an informal request as a claim if the claimant previously satisfied the requirements of § 5.51 or § 5.52 is merely to say that an informal claim is a claim under those circumstances. That is exactly what the regulation means, and VA has never intended an “informal request” to be something different from an informal claim. Using another term for an informal claim confusingly suggests that there is some other type of “informal communication in writing requesting a determination of entitlement, or evidencing a belief in entitlement, to a VA benefit” that might not be an informal claim. As the definition of “claim” reveals, this cannot be so. See § 5.1, defining “claim”.

Paragraph (c)(2) provides that VA will act on an informal claim without requiring another application from a person who has previously filed an application. The initially proposed rule and current § 3.155(c) allowed an informal claim for increase or to reopen to be accepted without the claimant subsequently filing an application if the claimant had previously filed a claim Start Printed Page 71067that “met the requirements of § 5.51 [disability benefits] or § 5.52 [death benefits]”. It is implicit, but not obvious, that VA can accept an informal claim for each type of benefit without requiring a subsequent application only if the claimant has previously filed an application for that type of benefit. An application that provides information critical to the benefit claimed satisfies the statutory requirement to file a claim “in the form prescribed by the Secretary”. Fleshman, 138 F.3d at 1431-32 (Applicant must file claim containing specified information, and without the “critical information” it will not be “in the form prescribed by the Secretary” so as to comply with 38 U.S.C. 5101(a)). It is VA's receipt of the information critical to a claim for disability benefits or for death benefits that enables VA to accept a subsequent informal claim for disability benefits or death benefits without requiring another application.

The previous filing of a claim for disability benefits will not have provided VA the critical information necessary for the claimant to have met the requirement of 38 U.S.C. 5101(a) for a claim for death benefits, and vice versa. As proposed to be revised, § 5.54(c)(2)(i) and (ii) will explicitly state the implicit requirement in initially proposed § 5.54(c) that VA will accept an informal claim for increase or to reopen a claim for disability or death benefits only if the claimant has previously filed a claim for that type of benefit.

§ 5.55 Claims Based on New and Material Evidence

We propose to revise initially proposed § 5.55 in response to a comment and based on our further review of the regulation. The commenter requested that VA make the rule clearer and use the active voice. We propose to revise this regulation to enhance readability and be more consistent with the format of other part 5 regulations.

The proposed revisions describe the process of, and provide instructions for, reopening a claim that the initially proposed regulation did not. The proposed revisions afford the claimant the same rights, however, and prescribe the same burdens and duties for the claimant and for VA in seeking to reopen a claim as did the initially proposed regulation. They articulate current VA practice in implementing 38 U.S.C. 5108, which requires VA to “reopen the claim and review the former disposition” if “new and material evidence is presented or secured”. They also make explicit several aspects of reopening a claim that are implicit in the initially proposed and the current regulation.

We propose to move the definition of a “reopened claim” from initially proposed § 5.57(f) to § 5.55(a) and (d) and restate it as a list of conditions necessary to reopen a claim VA has finally denied.

Initially proposed § 5.55(a) stated, “A claimant may reopen a finally adjudicated claim”. The paragraph characterized new and material evidence in reference to “evidence of record at the time of the last prior final denial of the claim sought to be reopened”. Both quoted phrases come from current § 3.156(a). As now proposed, § 5.55(a) states, “A claimant may reopen a claim if VA has made a final decision denying the claim.” It would be redundant to state that a claimant may reopen a “finally” adjudicated claim because we define “claim” in § 5.1 and we define “final decision” in § 5.1. A claim is not subject to reopening if a prior decision is not final. Therefore, in order to reopen a claim, paragraph (a) of this section requires the existence of a final decision denying that claim. These changes are consistent with the circumstances in which a claimant will seek to reopen a claim.

We propose to move the language in initially proposed § 5.57(f) regarding the Board of Veterans' Appeals (Board) treatment of certain evidence into § 5.55(d) because it relates to new evidence in the context of reopening a claim. We have shortened that language because under § 20.1304(b)(1)(i), any evidence or request for hearing referenced in that rule will be returned to the RO “upon completion of the Board's action on the pending appeal”. Therefore, the RO will apply § 20.1304(b)(1)(i) only in the context of a final denial, which is already discussed in § 5.55(a), or a grant or remand, in which case, the provisions of § 5.55 are irrelevant. The primary relevance of § 20.1304(b) to § 5.55 is that evidence submitted to the Board prior to its decision, but not considered by the Board, as set forth in § 20.1304(b), may be considered “new” for purposes of § 5.55.

We propose not to include the provision contained in § 5.57(f) regarding hearings in § 5.55(d). When a claimant requests a hearing at the Board more than 90 days after certification of an appeal and transfer of the claims file to the Board, the Board will not allow the hearing unless there is a showing of good cause for the delayed request. If the Board finds good cause and allows the hearing, then any testimony presented is considered in deciding the appeal. If the Board does not find good cause, then it will decide the appeal without conducting the hearing. In that case, it will refer the hearing request to the AOJ as required by 38 CFR 20.1304(b)(1)(i). Any testimony presented at a subsequent AOJ hearing on a claim for a benefit the Board denied would necessarily be “[e]vidence the claimant presented . . . since VA last made a final decision denying the claim the claimant seeks to reopen” under § 5.55(d)(1). Therefore, there is no need to include the § 5.57(f) language about hearings.

We propose to add paragraphs (b) and (c). Proposed paragraph (b) states, “To reopen a claim, the claimant must present or VA must secure new and material evidence. If VA receives a claim to reopen, it will determine whether evidence presented or secured to reopen the claim is new and material.” Proposed paragraph (c) reads, “If the claimant has presented or VA has secured new and material evidence, VA will reopen and decide the claim on its merits.” Together, these paragraphs clearly prescribe the sequence of actions in reopening a claim, implementing 38 U.S.C. 5108 and long-standing judicial precedent. See Manio v. Derwinski, 1 Vet. App. 140 (1991).

We propose to move the definition of “new and material evidence” in initially proposed § 5.55(a) to paragraph (d), so it now follows the information a claimant needs to know about the process of reopening a claim. We propose to reorganize the definition of “new and material evidence” as a set of criteria that evidence must meet to be “new” and a set of criteria it must meet to be “material”.

As initially proposed, the definition of “new and material” evidence could be misconstrued to imply that “new and material” evidence has some sort of combined characteristics in addition to those that satisfy the requirement that it is new and that it is material. VA has never intended the term “new and material evidence” to be interpreted this way, and the Federal Circuit has rejected such an interpretation. Anglin v. West, 203 F.3d 1343, 1346 (Fed. Cir. 2000) (rejecting appellant's assertion that “the concepts of newness and materiality are so intertwined that they cannot meaningfully be separated into `prongs' of a test”).

In proposing the current definition of “new and material evidence”, 38 CFR 3.156(a), VA stated, “We propose to clarify the definition of `new and material evidence' . . . to state that `new evidence' means . . . evidence not previously submitted to agency decisionmakers, that is neither Start Printed Page 71068cumulative nor redundant of the evidence of record at the time of the last final denial of the claim.” 66 FR 17838, Apr. 4, 2001. The courts have consistently associated “cumulative” with a failure of evidence to be New See, le.g., Anglin, 203 F.3d at 1346-47 (holding that CAVC correctly used first prong of Colvin test in finding appellant who filed “cumulative” evidence had not filed “new” evidence); Elkins v. West, 12 Vet. App. 209, 212 (1999) (new evidence is evidence not of record at time of last final disallowance of the claim and not merely cumulative of other evidence that was then of record); Colvin v. Derwinski, 1 Vet. App. 171, 174 (1991) (“New evidence is not that which is merely cumulative of other evidence on the record.”) (overruled in part by Hodge v. West, 155 F.3d 1356 (Fed. Cir. 1998)).

In Anglin, the Federal Circuit affirmed the holding of the CAVC that the appellant's cumulative evidence was not new evidence. 203 F.3d at 1347. The Federal Circuit explained that Hodge did not overrule the first prong of the so-called Colvin test of “new and material evidence.” 203 F.3d at 1346 (“[N]othing in Hodge suggests that the understanding of `newness' as embodied in the first prong of the Colvin test is inadequate or in conflict with the regulatory definition of new and material evidence.”). The Anglin court rejected the appellant's argument that “the concepts of newness and materiality are so intertwined that they cannot meaningfully be separated into `prongs' of a test.” Id. at 1346. The CAVC explicitly found “[b]ecause the evidence presented . . . was not new, the CAVC did not examine whether it was material. This application of the first prong of the Colvin test was entirely consistent with the regulatory definition of new and material evidence.” Id. at 1347. As restated, proposed § 5.55(d) clearly distinguishes between new evidence and material evidence. It makes clear what new evidence is, what material evidence is, that to reopen a claim the evidence must meet both criteria, and that failure of the claimant to present or of VA to secure either will bar reopening the claim.

Initially proposed § 5.55(a) reiterated the language of current § 3.156(a), “New evidence means existing evidence”, and “Material evidence means existing evidence”. For the following reasons, we propose to remove the term “existing” in both instances.

In 2001, VA amended the definition of “new and material evidence” to implement the Veterans Claims Assistance Act of 2000, Public Law 106-475, sec. 3, 114 Stat. 2096, 2096-98 (2000), which mandated that VA assist claimants to substantiate their claims. In doing so, VA prescribed the assistance it would give a claimant to substantiate a claim to reopen by limiting its duty to obtain new and material evidence to obtaining “existing evidence”, as distinguished from newly created evidence. 66 FR 17837-38, Apr. 4, 2001. VA did this to avoid the implication that, under the VCAA of 2000, it had a duty to create new evidence, for example through a medical examination. 66 FR 45628, Aug. 29, 2001 (“VA would not provide an examination or obtain a medical opinion to create new evidence”). VA intended “existing evidence” to mean “evidence that is not newly generated by or with the help of VA”. 66 FR 17838, Apr. 4, 2001.

Nonetheless, if “new” evidence and “material” evidence both mean “existing” evidence, then initially proposed § 5.55(a) could be misconstrued to mean that VA would not accept any evidence newly created to reopen the claim because it is not “new and material” as defined. As initially proposed, the rule could produce the strange result, for example, of VA rejecting a new medical opinion that a claimant obtains and files to reopen a claim as not “new and material evidence”, because it would not be “existing evidence.” We therefore propose to remove the term “existing” to avoid any potential for such misapplication.

There is no need to qualify “new and material evidence” as “existing evidence” to ensure that VA's duty to assist the claimant in obtaining new and material evidence is as limited as VA intends. In any claim, the claimant must identify existing evidence and provide VA the information necessary to obtain this evidence before VA is obligated to try to procure that evidence for the claimant. See proposed § 5.90(c). Nothing about asserting that the evidence is new and material or the fact that the claimant wants VA to obtain that evidence in order to reopen a claim exempts the claimant from his or her obligation. Consequently, the definition of new and material evidence does not need the qualifier “existing” to limit VA's duty to assist. Likewise, another paragraph of the “duty to assist” regulation provides that VA has no duty to assist a claimant seeking to reopen a claim by providing medical examinations or obtaining new medical opinions until new and material evidence is presented or secured. See proposed § 5.90(c)(4)(iii). Therefore, the definition of “new and material evidence” does not need the qualifier “existing” to proscribe a duty to provide medical examinations or obtain medical opinions for the claimant seeking to reopen a previously finally denied claim.

Finally, we propose to redesignate initially proposed paragraph (b), “Effective date”, as paragraph (e). We propose to change the term “awards” to “grants”, consistent with the use of “grant” in part 5 as a verb meaning to decide a claim affirmatively.

§ 5.56 Report of Examination, Treatment, or Hospitalization as a Claim

We propose to revise and reorganize this regulation for simplicity. We also propose to address several specific issues.

We propose to revise initially proposed paragraph (a) so that it simply states the purpose and effect of this section. It is necessary to explain that evidence construed as a claim in accordance with this section meets the claim requirement of § 5.51(a), because after VA receives such evidence, VA requires the claimant to take no further action to establish that he or she has filed a claim. In other words, the evidence constitutes a claim “that is in the form prescribed by the Secretary” for filing the claims to which this section applies.

We propose to add a new paragraph (b), “Claims excluded”, which provides that VA's receipt of a report of examination, treatment, or hospitalization is a claim only under the circumstances named in paragraph (c) of this section. We emphasize this point by explicitly excluding from the scope of this section new claims for service connection.

In reviewing the initially proposed regulation, we noticed that in some places we referred to a report of examination or hospitalization and in others we referred to a report of examination or treatment. Our intent was to accept a report of examination, treatment, or hospitalization as a claim in the situations described. We propose to revise this regulation, including the title, to reflect that any of these types of medical reports may be a claim for increased benefits or for pension under the circumstances described. The revised title also represents the content of the regulation more accurately.

We propose to reorganize initially proposed paragraph (b) of this section and redesignate it as paragraph (c), “Claims included”. We propose to replace the initially proposed language with four succinct statements, (c)(1), (2), (3), and (4). Each statement articulates a circumstance in which VA's receipt of Start Printed Page 71069medical records is a claim and identifies what type of claim it is, for example, a claim for increased disability compensation. We propose not to repeat the language, “or once a formal claim for disability compensation has been denied because the service-connected disability is not compensable in degree”. We also propose not to repeat the language, “or an informal claim to reopen”. Both phrases are superfluous and potentially confusing to readers. VA formerly considered claims where VA granted service connection for an injury or disease, but rated the disability as 0 percent disabling as having been disallowed or denied. See Par. 4, VA Technical Bulletin 8-180, “Claims for Increase and Reopened Awards” (June 13, 1951). VA considered hospital treatment records as “an informal claim to reopen” such a claim in order to receive a compensable rating. Id.

VA currently considers claims for disability compensation to have been granted, notwithstanding that the disability is rated 0 percent, so long as VA granted service connection. This is because even a 0 percent rating can yield disability compensation or other benefits, such as medical treatment. See 38 CFR 3.324, “Multiple noncompensable service-connected disabilities”. Because VA no longer considers such claims disallowed or denied, they cannot be “reopened”. Instead, a claimant who believes he or she is entitled to more than a 0 percent rating need only file a claim for an increased rating. Hence, we propose to remove the above-referenced language from redesignated § 5.56(c). Furthermore, 38 CFR 3.157 has never applied to permit the reopening of a claim that was denied because the claimed injury or disease was not service connected. 38 CFR 3.157(b) applies only where “a formal claim for . . . compensation has been allowed or . . . disallowed for the reason that the service-connected disability is not compensable in degree”. Removing the above-referenced language will remove any possible confusion on this point.

The reasoning for not using the term “disallowed” or “denied” or referring to a “reopened” claim in the context of a prior grant of service connection to a veteran rated 0 percent disabled also applies to claims under this section from veterans receiving retired pay. Proposed paragraph (b)(2) changed “disallowed” to “denied” in restating the § 3.157(b) rule about retirees. Section 3.157(b) provides for claims from “a retired member of a uniformed service whose formal claim for pension or compensation has been disallowed because of receipt of retirement pay.” “Disallowed” is used there in the same sense in which § 3.157(b) uses it to refer to nonpayment of disability compensation to a service-connected veteran rated 0 percent and for the reason discussed above; such a claim is not “reopened.” VA may grant service connection to a veteran, yet not pay disability compensation because the veteran elects to receive retired pay rather than VA disability compensation. VA would also not pay pension to the retiree in receipt of retired pay if the amount of retired pay is greater than the amount of income above which VA will not pay pension benefits. In neither instance is a claim under this section “reopened” or a claim to reopen. Our proposed restatement of initially proposed § 5.56(b)(2), to be redesignated as proposed paragraph (c)(3), includes a heading that accurately describes the circumstances in which the section applies to veterans receiving retired pay. It also describes the claims, simply, as for disability compensation or for pension.

Initially proposed § 5.56(c)(3) used the term “retirement pay”. Upon further review, we noted that the terms “retirement pay” and “retired pay” were inconsistently used in part 3. To correct this inconsistency, we propose to use the term “retired pay” throughout part 5 when we are referring to “payment received by a veteran that is classified as retired pay by the Service Department”. See proposed § 5.745(a), for the definition of “military retired pay”.

We propose to redesignate initially proposed paragraph (c) as paragraph (d). Initially proposed § 5.56(c)(1)(i) read:

The provisions of paragraph (c)(1) of this section apply only when the reports described in paragraph (c)(1)(ii) of this section relate to examination or treatment of a disability for which service-connection has previously been established or when a claim specifying the benefit sought is received within 1 year after the date of an examination, treatment, or hospital admission described in paragraph (c)(1)(ii) of this section.

We have not repeated the quoted language of initially proposed paragraph (c)(1)(i) in redesignated paragraph (d)(1)(i). The first clause of the initially proposed language, as with the equivalent language in § 3.157(b)(1), stated, “The provisions of paragraph (c)(1) of this section apply only when the reports described in paragraph (c)(1)(ii) of this section relate to examination or treatment of a disability for which service-connection has previously been established”. The purpose of this language is to emphasize that medical records will not be considered a claim for service connection for a disability. As stated, however, it would preclude the reports described from being a claim for pension. VA has never applied the rule to reject records from a VA or uniformed service medical facility as a claim for pension following a prior grant or denial of pension. We therefore propose to remove the language to avoid such a misapplication of the rule.

The language in the quotation above (§ 5.56(c)(1)(i)) also tracks language from current § 3.157 that was intended to govern a situation in which a claimant obtained treatment for a service-connected disability and during that treatment, the examiner noted the existence of another disability. Before 1962, 38 U.S.C. 3011 had described an award of increased disability compensation or pension as “an award of increased compensation . . . or pension (amending, reopening, or supplementing a previous award, authorizing any payments not previously authorized to the individual involved)”. 38 U.S.C. 3011 (1958). Thus, the law seemed to provide that a claim for increase included a claim for additional disability compensation based on a new disability, if the veteran was already receiving disability compensation. However, that language has long since been repealed. See Public Law 87-825, sec. 5(a), 76 Stat. 948, 950 (Oct. 15, 1962). Current law does not provide for the possibility of assigning a 1-year retroactive effective date of disability compensation awarded based on a new disability (unless the claim for disability compensation is received no later than 1 year after the veteran is discharged from service, see 38 U.S.C. 5110(b)(1)). In this and other respects, current law does not treat a claim for disability compensation based on a new disability in the same manner as a claim for increased disability compensation based on an increase in the severity of a disability that is already service connected. Thus, this regulation governing the consideration of medical evidence as a claim can no longer apply to a claim based on a disability not previously claimed. This is consistent with our analysis of the first sentence of current § 3.157(b), discussed above, in which we explained why the part 5 rule will not refer to a prior claim having been “disallowed” or to a claim needing to be reopened.

One commenter suggested that the meaning of the phrase “or when a claim specifying the benefit sought” that had been used in initially proposed § 5.56(c)(1)(i) should be explained more thoroughly. The commenter noted some confusion concerning its meaning based Start Printed Page 71070on the dissent in Ross v. Peake, 21 Vet. App. 534 (2008) (Order denying full-court consideration) (Judge Kasold, dissenting).

As stated above, the language “or when a claim specifying the benefit sought” is a vestige of a statute that is no longer in effect. We are not using the phrase in part 5, and therefore we do not need to further explain its meaning.

Regarding the Ross dissent, Judge Kasold interpreted a similar provision in current § 3.157 as providing an earlier effective date for claims for secondary service connection. This view, however, directly contradicts the holding of the Federal Circuit in MacPhee v. Nicholson, 459 F.3d 1323 (Fed. Cir. 2006). Judge Kasold believed that § 3.157 “envisions a claim for increased compensation based on a disability for which service connection has not yet been granted.” Ross, 21 Vet. App. at 535. In MacPhee, however, the Federal Circuit held that an informal claim pursuant to § 3.157 “must be for a condition that not only has been the subject of a prior claim, but the condition must also have been previously found to be service connected.” MacPhee, 459 F.3d at 1326. Thus, § 3.157 does not support the assertion that a claim for benefits for a separate disability may be considered a claim for increased disability compensation.

The sources of evidence that can constitute a claim under paragraph (d)(1) (initially proposed paragraph (c)(1)) are regrouped in paragraph (d)(1)(ii) as (d)(1)(ii)(A) through (D), according to date of claim that results from submission of the particular evidence. Though this makes a fourth level of designation in the rule, it should enhance readability.

Initially proposed paragraph (c)(3)(i), regarding evidence from state and other institutions, stated, “Benefits will be granted if the records are adequate for rating purposes; otherwise findings will be verified by official examination.” We propose to change “official” to “VA”, to make clear that the official examination to which the sentence refers is a VA examination. We also propose to add the phrase, “and demonstrate entitlement to an increased rating, to pension, or to special monthly pension” after “rating purposes” to clarify that mere receipt of such evidence does not establish entitlement to benefits.

Initially proposed paragraph (c)(3)(ii) included the phrase “and entitlement is shown”, derived from current § 3.157(b)(3), as a condition on the date of VA receipt of evidence from state and other institutions as the date of a claim. Neither § 3.157(b)(1) nor (b)(2) contains such a restriction. We therefore propose to remove this language because if the claimant does not eventually establish entitlement to the benefit, then the date of receipt of the claim has no legal significance. Therefore, the language, “and entitlement is shown” is superfluous.

Finally, we propose to revise initially proposed paragraph (d), “Liberalizing law or VA issue”, for clarity and to redesignate it as paragraph (e).

§ 5.57 Claims Definitions

We propose to revise the format of this regulation to be consistent with the format of other regulations that provide definitions. We propose to revise the title of the regulation to be, “Claims definitions”, because it more clearly indicates the contents of the regulation.

We also propose to restate and expand the scope of the definitions. The initially proposed rule, like current § 3.160 from which it derives, stated that the definitions applied to claims for pension, disability compensation, and DIC. VA administratively processes claims under 38 U.S.C. chapter 18 in the same manner as VA processes pension, disability compensation, and DIC. Therefore, we propose to restate the scope of § 5.57 as applying to claims for disability benefits, death benefits, or monetary allowance for a veteran's child under 38 U.S.C. chapter 18. The proposed change to “disability benefits” and to “death benefits” (from “pension, disability compensation, and dependency and indemnity compensation”) better harmonizes the scope of the regulation with the regulations on claims for disability and for death benefits. See §§ 5.51 and 5.52.

We propose to remove initially proposed paragraph (a), definition of “formal claim”. As initially proposed, the definition, “A claim filed on the application required”, was impracticable. There are benefits for which VA does not have an application, for example benefits under 38 U.S.C. 1151. Moreover, as a result of revision of several other proposed regulations, the term does not appear in part 5 other than in its definition. There is no need to define a term that is not used.

We propose to redesignate initially proposed paragraph (b), “Informal claim”, as paragraph (a).

We propose to redesignate initially proposed paragraph (c), “Original claim”, as paragraph (b). We propose to revise the definition to state, “Original claim means the first claim VA receives from a person for disability benefits, for death benefits, or for monetary allowance under 38 U.S.C. chapter 18.” This restatement eliminates the term “formal claim”. It is the lack of a prior claim for any disability, death, or chapter 18 benefit that makes a claim the original claim for the benefit.

It is confusing to define the original claim as “the initial formal claim”. More significantly, it is fallacious. Even if we kept the definition of “formal claim” as a claim filed on a prescribed application, the lack of an application for some benefits would make the initially proposed definition of “original claim” impracticable. If an original claim must be an application and there is no application for some benefits, then there cannot be an original claim for some benefits. That conclusion is untenable.

We also propose to add “from a person” to be clear that when two or more claimants each file a claim for the same benefit, each claim will be the original claim for that person. For example, two siblings each filing a claim for DIC based on the death of the same veteran would each have an original claim. This was not apparent in the initially proposed regulation.

We propose to remove initially proposed paragraph (e), “Finally adjudicated claim”. It is essentially redundant of the definition of “final decision” in § 5.1. The definition of “final decision” in § 5.1 encompasses the definition of “finally adjudicated claim” in § 3.160(e), but it is more precise. The procedural posture of finality of VA decisions applies to VA claim adjudication more broadly than just to claims for pension, disability compensation, DIC, and monetrary allowances under 38 U.S.C. chapter 18. For that reason, it is more appropriate for the rule defining finality to be in § 5.1 than in § 5.57, which has a limited scope.

One commenter objected to the title of § 5.57(f), “Reopened claim”, asserting that the title is misleading because the paragraph does not describe what a reopened claim is and is not consistent with how VA and the courts have used the term. This commenter felt that a better title would be, “Claim to reopen.” We agree that “reopened claim” is inaccurate. As noted by the commenter, this paragraph concerns submission of evidence, information, or an assertion of entitlement to a procedure applicable to a previously decided claim. Such submission of evidence, information, or an assertion of entitlement to a procedure applicable to a previously decided claim may not always result in the claim being reopened. We propose to use the suggested phrase “claim to reopen”. However, we propose to do so in the context of moving the paragraph Start Printed Page 71071to § 5.55(a), as we discussed above regarding § 5.55.

Duties of VA; Rights and Responsibilities of Claimants and Beneficiaries AL82

General Comment on VA Claims Process

One private individual submitted a comment concerning the length of time VA takes to process a claim and his dislike of the appeal process. This comment is outside the scope of these proposed regulations, and we therefore propose to make no changes based on this comment.

§ 5.80 Rights to Representation

Two commenters suggested that this initially proposed section was deficient in its scope. They expressed a belief that a claimant or beneficiary should be given notice of the right to representation throughout the adjudicative process, not only when VA sends notice of a decision or a proposed reduction, discontinuance, or other adverse action. Both expressed the opinion that VA should notify the claimant of the right to representation at the beginning of the claims process.

It has been VA's long-standing practice to provide notice to claimants of the right to representation in VA's initial response to the claimant after VA receives a substantially complete application. We propose to revise initially proposed § 5.80 to state that written notice concerning the right to representation will be included in the initial response VA sends to the claimant after receipt of a substantially complete application.

One commenter noted that initially proposed § 5.80 failed to set out in detail the crucial role of the representative in the adjudicative process. Another commenter urged VA to include in initially proposed § 5.80 the limitations on hiring an attorney.

Part 3 regulations do not describe the role of representatives in the adjudicative process or the limitations of hiring an attorney and we do not believe part 5 should either. The rights, duties, limitations and role of a representative are in 38 CFR 14.626—14.637. The first sentence of § 5.80 refers the reader to those sections. We are making no changes in the language of the regulation in response to these comments. We have, however, added a cross reference at the end of initially proposed § 5.80 to 38 CFR 19.25, “Notification by agency of original jurisdiction of right to appeal”, which requires that VA include the right to representation in its notice of an adverse decision on a claim.

One commenter urged VA to include a provision acknowledging the right of both the claimant and the claimant's representative to automatically receive copies of evidence secured by VA. The commenter asserted that access to the evidence developed and relied upon by VA to reach its decision is crucial to proper notice and is a fundamental due process right.

A veteran and representative are entitled to a copy of the evidence or other written records contained within a veteran's claims file in accordance with the provisions of 38 U.S.C. 5701(b)(1), as implemented in 38 CFR 1.503. The veteran or representative must make a written request for the copies of the evidence in accordance with the provisions of 38 U.S.C. 5702(a). See 38 CFR 1.526. The procedures for a veteran and the representative to obtain copies of the evidence used in deciding a claim have been established by statute and VA has implemented these procedures in our regulations. If VA adopted the rule that the commenter urges, it would require VA to copy and mail every document it acquires regardless of its relevance to the veteran's claim. We do not believe that it would be an appropriate use of VA's limited resources to automatically provide both the claimant and the claimant's representative with copies of every piece of evidence that VA secures.

The procedures provided in current statutes and regulations do not infringe on the claimant's due process rights. The claimant has the right to notice of the evidence VA will attempt to obtain on the claimant's behalf, of the evidence the claimant has the responsibility to obtain and submit, and of the decision on the claim. If the decision is adverse, the notice must include a discussion of the evidence considered and the reasons and bases for the decision and it must include the claimant's appellate rights. The claimant may, upon written request, generally obtain a copy of the evidence used in making the decision on the claim. Since our regulations already provide for the result the commenter requested, though not in the manner urged by the commenter, we propose to make no changes based on this comment.

§ 5.81 Submission of Information, Evidence, or Argument

Initially proposed § 5.81(a), “Submissions included in the record”, referred to submissions “that a claimant offers. . .” One commenter asserted that § 5.81(a) failed to specify that a claimant's recognized representative has the authority to raise issues on behalf of a claimant.

As stated in our response to a similar comment on initially proposed § 5.80, part 3 regulations do not describe the role of representatives in the adjudicative process or the limitations of hiring an attorney and we do not believe part 5 should either. Initially proposed § 5.81(a) was not intended to regulate the specific authority of a claimant's or beneficiary's representative. This information is codified in §§ 14.626-14.637, to which § 5.80 refers, and to include it in part 5 would be redundant. We therefore propose to make no change based on this comment.

In initially proposed § 5.81(a), we used the term “record of proceeding” twice. We have substituted the term “evidence of record” to be consistent with the other part 5 regulations. This regulation was the only one in part 5 to use the term “record of proceeding”.

Initially proposed § 5.81(b) stated:

Information, evidence, or argument may be submitted by a claimant or beneficiary, or, where applicable, through a guardian or fiduciary acting on his or her behalf. Unless specifically provided otherwise in this part, a claimant's or beneficiary's authorized representative may submit information, evidence, or argument pursuant to any section of this part that allows or requires submission of information, evidence or argument.

Two commenters expressed concern with this paragraph as implying some new restriction on a representative's authority to submit material on behalf of a client. One commenter argued that this section is inappropriate because an authorized representative stands in the same position as the client and should be allowed to submit evidence and arguments as if he is the claimant or beneficiary. The same commenter suggested inserting the phrase “or their authorized representative” after “beneficiary” and deleting the second sentence.

We did not intend to constrain an authorized representative's role or authority in the VA claims process. After reviewing initially proposed § 5.81(b) because of the comments received, however, we noted that all the information contained in the paragraph is also in other regulations. Section 1.524 provides for the right of a fiduciary, representative, attorney, or other authorized person to represent the claimant. Sections 13.1, et seq., and 14.626-14.637 provide specific provisions concerning these representatives. Because other regulations provide for the rights and duties provided in initially proposed § 5.81(b), and do so in greater detail, Start Printed Page 71072§ 5.81(b) is redundant, and we propose to remove it.

§ 5.82 Right to a Hearing

We propose to add language to initially proposed § 5.82(a) to make clear that the section pertains only to hearings in claims at the agency of original jurisdiction level of adjudication. We propose to change “claimants” to “claimants and beneficiaries”, except in paragraph (f), to make clear that the rules in § 5.82 apply to claimants and to current beneficiaries. Paragraph (f) pertains only to hearings in response to a VA proposal to take adverse action regarding a beneficiary's benefits. Finally, we propose to change “claim” to “matter” to clarify that if a beneficiary requests a hearing to give testimony or evidence on whether VA should take adverse action against the beneficiary's benefits, such a hearing is within the scope of § 5.82.

Further review of the initially proposed regulation revealed a contradiction between paragraphs (a)(1) and (f). Initially proposed paragraph (a)(1) provided for one hearing “at any time on any issue”. Initially proposed paragraph (f) provided, as does current § 3.105(i) from which it derives, that a beneficiary must request a hearing on the issue of reduction, discontinuance or other adverse VA action within 30 days after receipt of a notice of VA's proposal to take the adverse action. Therefore, a hearing under paragraph (f) is not available “at any time on any issue”. We propose to reconcile the two paragraphs by beginning paragraph (a)(1), “Except as provided in paragraph (f),”. This is not a change from current regulation. Compare §§ 3.103(c) (“a hearing on any issue at any time”) with 3.105(i) (“a predetermination hearing [if] a request . . . is received within 30 days”). It merely clarifies the relationship between paragraphs (a) and (f). This relationship exists between §§ 3.103(c) and 3.105(i), but it becomes obvious when the provisions are consolidated in a single section.

We propose to revise the second to last sentence of initially proposed § 5.82(a), removing the statement entitling a veteran to a hearing before the Board of Veterans' Appeals (Board). Instead, we propose to add a cross reference to the introduction to make the reader aware of Board hearings and to distinguish between hearings at the AOJ and at the appellate levels of adjudication. We propose this change because 38 CFR part 20 provides for the right to a hearing before the Board, and it is not appropriate to regulate Board hearings in part 5.

The initially proposed rule allowed, “one hearing before the agency of original jurisdiction at any time on any issue or issues involved in a pending claim before the agency of original jurisdiction” and permitted one additional hearing “if the claimant asserts that: he or she has discovered a new witness or new evidence to substantiate the claim; he or she can present that witness or evidence only at an oral hearing; and the witness or evidence could not have been presented at the original hearing.” Four commenters asserted that the limitation in initially proposed § 5.82 on the number of hearings allowed was too restrictive. For the reasons stated in response to specific comments, we disagree that the regulation is too restrictive and we reject each of the reasons argued for keeping the current rule.

One commenter asserted that the “one-hearing rule” diminishes claimants' right to due process because it is inconsistent with the VA's tradition of giving claimants the opportunity to continue to produce and submit evidence or argument as a claim develops. It might be true that the one-hearing rule could inhibit ongoing production of evidence or argument throughout the time a claim is pending, if a personal hearing were the only way to submit evidence or argument to the record in a claim, but it is not. Section 5.81, the regulation governing submission of evidence and argument generally, could scarcely be more permissive regarding entering material into the record in a claim: A claimant may submit virtually anything, at almost any time, by nearly any means. Nothing in § 5.82 diminishes the right to submit material to the record in a claim throughout the time the claim is pending, except as limited by the rules of the Board of Veterans' Appeals for submission of material after the AOJ transfers a claim to the Board on appeal. 38 CFR 20.1304.

The same commenter asserted the rule is inconsistent with the current due process right to a hearing before the initial decision on a claim. The commenter requested that we include a provision informing the veteran of the right to a hearing before VA makes a decision on a claim. We interpret the comment to express concern that an adverse decision in a claim could bias a subsequent decision-makers, and that a claimant would have to overcome that bias in a subsequent hearing. Initially proposed paragraph (d) provided that “a VA employee or employees having decision-making authority and who did not previously participate in the case will conduct the hearing.” The comment offered no basis to believe that a VA official conducting a hearing would not be impartial, and we propose to make no change to preempt a bias that is not demonstrated.

To the extent the commenter is concerned about lack of notice to the claimant of the right to a hearing before the decision on a claim, VA does notify claimants of the right to a personal hearing at any time, including before VA has decided a claim. See, for example, VA Form 21-526, instructions page 6, Veteran's Application for Compensation and/or Pension (Jan. 2004), or VA Form 21-534, instructions page 2, Application for Dependency and Indemnity Compensation, Death Pension and Accrued Benefits by a Surviving Spouse or Child (Including Death Compensation if Applicable). Because VA already provides this information to claimants, we propose to make no change based on this comment.

Absent the discovery of a new witness or evidence, there is no valid reason to hold an additional hearing. A single hearing provides full and fair opportunity to place demeanor evidence in front of the decision maker, which satisfies a primary object of personal hearings. The one-hearing rule with its paragraph (a)(2) allowance for a second hearing under the stated circumstances provides a fair and rational balance between the rights of the claimant and the resources of the department. Repeated interruption of the adjudication process for hearings can result in confusion about the evidence to review and in interminable delay, both of the claims subjected to repeated hearings and to the progress of the claims of others who wait their turn. These are not inconsequential concerns. If a claimant wants to submit new arguments, he or she may do so in writing at any time. We therefore propose to make no changes based on these comments.

Another commenter asserted that the provision for an additional hearing is likely to result in VA arbitrarily refusing an additional hearing that a claimant would use to respond to evidence that entered the record subsequent to the first hearing, resulting in limiting a claimant to one hearing in almost all circumstances. After noting the criteria for a second hearing in paragraph (a)(2), the commenter asserted that paragraph (a)(2) should provide for additional hearings “when warranted by circumstances” or “for good cause” and authorize VA to refuse a second, third, or further additional hearing “when clearly unwarranted.” The commenter asserted that there are many Start Printed Page 71073circumstances that would warrant an additional hearing that would not meet the criteria in paragraph (a)(2). The commenter asserted that the claimant should be able to testify to additional matters even though the testimony would not amount to newly discovered evidence or present a different witness. The commenter further asserted that paragraph (a)(2) would allow a claimant a second hearing for a new witness to testify in corroboration of prior testimony, that is, to provide cumulative testimony. The commenter concluded that the several requirements for a second hearing, including that the hearing be the only way to present the evidence or testimony, is a license for refusal by VA personnel to afford a supplemental hearing in virtually all cases.

We recognize the commenter's concern that the one-hearing rule will thwart a claimant's legitimate desire to respond to developments during the pendency of the claim. The threshold for obtaining a second hearing, however, is a mere assertion of the factors in the exception paragraph. We see no basis for the speculation that VA will probably refuse almost all requests. It seems likely that a claimant's desire to testify or present witnesses or evidence to rebut evidence that entered the record after a prior hearing is exactly a situation in which the claimant could not have adduced the new evidence or witnesses' testimony before the evidence it would rebut was of record.

We do not agree that the standards for obtaining a second hearing invite arbitrary or capricious refusal of requests for second hearings, or even that VA will deny most requests. Rather, the rule the commenter proposed “where circumstances warrant,” or “for good cause,” but “not when clearly unwarranted” are completely devoid of a standard of application; they seem far more likely to result in inconsistent application than do the paragraph (a)(2) criteria.

More basically, the commenter would have VA afford additional hearings even though the claimant would present no new witness or evidence; even though the claimant could present the testimony of a new witness, or new evidence, without a hearing; and even though the claimant knew of the witness, evidence or argument at the time of the first hearing and could have presented them. The commenter “concede[d] that VA has a legitimate interest in preventing duplicative and unnecessary hearings,” a point with which we do agree. We conclude that the one hearing rule with the paragraph (a)(2) exception provides full and fair hearing process to each claimant.

A commenter objecting that § 5.82(a) would limit a long-standing right to unlimited hearings, asserted that VA had not provided an adequate rationale for its proposed fundamental change in its historic and traditional hearing practice. The preceding paragraphs state additional rationale for the change. Additionally, we do not agree that the change is fundamental, because VA hearing practice will continue to serve every function it has under current § 3.103(c).

The commenter further asserted that “Congress has codified and ratified the agency's traditional practice of providing claimants with multiple opportunities to appear for personal hearings.” The commenter asserted that Congress is presumed to be aware of and adopt an administrative interpretation of a statute when it reenacts the statute without change, citing Young v. Cmty. Nutrition Inst., 476 U.S. 974, 983 (1986). The commenter reiterated this point regarding additional hearings at the AOJ after the Board remands a claim if the claimant had a hearing before Board review of the claim. The commenter asserted that Congress intended VA to continue its existing practice regarding hearings at the AOJ when it enacted the Veterans' Judicial Review Act of 1988, Public Law 100-687, 102 Stat. 4105 (1988), and the Veterans Claims Assistance Act of 2000, Public Law 106-475, 104 Stat. 2096 (Nov. 9, 2000), without changing the law governing provision, number, or timing of VA personal hearings. The commenter did not identify a statute the reenactment of which constituted Congressional adoption of 38 CFR 3.103(c), from which § 5.82(a) derives. Neither of the statutes cited addresses VA hearing practice. We are aware of no statute that does.

The right-to-a-hearing rule in § 3.103(c) is VA's creation, promulgated under the Secretary's general rule-making authority in 38 U.S.C. 501(a). Moreover, as judicial precedent specific to VA clearly shows, congressional silence on a regulation is not necessarily adoption or endorsement of the regulation, or even an indication that Congress is aware of the regulation. Brown v. Gardner, 513 U.S. 115, 120-21 (1994) (Sixty-year congressional silence about VA regulation did not ratify it; language of statute was plain, record of congressional discussion preceding reenactment of the predecessor statute made no reference to VA regulation and there was no other evidence to suggest Congress was even aware of VA's interpretive provision). Certainly, where VA's rule on hearings does not derive from a statute on hearings, Congress's silence about the matter does not imply a congressional view of the regulation. The cases the commenter cited for the proposition that congressional failure to revise a regulation is endorsement of it were instances of congressional action on a statute to which a certain regulation related.

The commenter also asserted as fact that “the legislative history associated with congressional oversight of the agency shows that Congress knew about VA's practices governing personal hearings and did not indicate that it disagreed with the agency's practices.” As we noted above, congressional silence about a practice is not necessarily evidence of congressional endorsement. Id., at 120-21. Silence about an agency practice in the context of congressional knowledge and consideration of a matter could, however, be significant. The House Committee on Veterans' Affairs was authorized by enactment of the “Legislative Reorganization Act of 1946.” Public Law 79-601, sec. 121(a). See http://veterans.house.gov/​history/​ (World Wide Web site of the House Committee, visited Dec. 2, 2009). The Committee has oversight responsibility for VA, which it exercises through the Subcommittee on Oversight and Investigations. See http://veterans.house.gov/​oversight/​ (World Wide Web site of the oversight subcommittee, visited Dec. 2, 2009). The commenter does not cite any history of the Subcommittee on Oversight and Investigations documenting its knowledge or viewpoint on VA hearing practice, or say when during the more than 60-year history of congressional oversight of veterans affairs an this expression of knowledge happened. We are not aware of any history of congressional oversight showing endorsement of VA hearing practice. Consequently, we propose to make no change in the initially proposed regulation based on the assertion that congressional oversight history shows that Congress has approved current practice.

The same commenter objected to the language in initially proposed § 5.82(a)(1) precluding a claimant who had a hearing prior to an appeal to the Board from having a second hearing if the Board remands the case, except as paragraph (a)(2) provides. The commenter quoted from the AL82 NPRM, emphasizing the discussion of current § 3.103(c), which stated, “The VA official conducting the hearing is obligated to elicit any information or evidence not already of record in Start Printed Page 71074support of the benefit claimed.” 70 FR 24680, 24683, May 10, 2005. The commenter asserted that “as is so often the case, the requirements of the law, [sic] are conveniently forgotten by VA litigation counsel when a veteran appeals to the U.S. Court of Appeals for Veterans Claims.” The commenter cited the Secretary's brief in Colon v. Nicholson, 21 Vet. App. 96 (2006) (table, unpublished decision), WL 2105515 (text), as an example of VA excusing the failure of a hearing officer to execute the regulatory mandate to explain the issues and suggest evidence to submit. The commenter quoted a passage from the brief that asserted that the appellant could have cured the failure of the Regional Office hearing officer to consider and discuss an issue in the case by having another personal hearing or by other means after the Board had remanded the case. The commenter argued that VA's argument in Colon “demonstrates . . . why VA should not limit a claimant's right to appear for personal hearings.”

VA's arguments or litigation strategy in a case on appeal to the court is beyond the scope of this rulemaking, Whatever the argument or reason for an argument raised in litigation, litigation of a VA claim is far downstream in the claims process from the hearings for which § 5.82 provides. The commenter asserted that VA's argument in Colon “shows that [VA's] litigation counsel have no qualms whatsoever in presenting argument . . . to undermine the legal effect of the agency's binding regulations.” The commenter essentially argues that VA should allow unlimited hearings because far downstream from the hearing the Secretary's counsel might argue to the court that a failure to follow a regulation was a harmless error in a specific case. We do not agree that a right to unlimited hearings is likely to preempt an argument at litigation, nor is that an appropriate object of regulation.

The commenter implicitly raised another point worth addressing, that is, whether there is a cure for a defective hearing, and if so, whether the one-hearing rule thwarts that right. In practice, another hearing would cure a defect in the original hearing, and the one-hearing rule will not inhibit that remedy. VA and its hearing officers have various duties in conducting hearings, such as to explain all issues and suggest the submission of evidence the claimant might have overlooked. A right to unlimited hearings is an overly broad remedy for a defective hearing, because it would result in many redundant hearings in cases in which the initial hearing had comprehensively addressed all issues and fully provided due process.

If a hearing was defective, the claimant can assert so to the AOJ, or on appeal to the Board. A defective hearing would not be legally sufficient to satisfy the claimant's right to one hearing. The claimant would be in the position of not having had a hearing. The one-hearing rule in paragraph (a)(1) would not bar repeating the hearing to cure the defect, and the claimant would not be subject to the criteria in paragraph (a)(2) to obtain the new hearing. The claimant could obtain this new hearing from the AOJ. If the claimant appeals an adverse decision to the Board, the claimant can assert the deficiency in the hearing. A Board remand to cure a deficiency in a personal hearing would not be subject to the rule against post-remand hearings in paragraph (a)(1), because it would require AOJ implementation of a specific order within the Board's authority. 38 CFR 19.9. Consequently, the one-hearing rule does not raise the specter of deficient hearings without a remedy for the claimant. Moreover, a remand from the Board alone is not sufficient reason for another hearing in light of the reasons expressed above for the one-hearing rule. If a remand from the Board orders development of evidence, or otherwise results in the conditions that meet the criteria for an additional hearing in paragraph (a)(2), then the claimant can obtain the additional hearing. We propose to make no change to the rule based on the comment.

We propose to reorganize initially proposed paragraph (a)(2) to make its three criteria visually clear by designating them (i), (ii), and (iii).

Initially proposed § 5.82(b) stated, in pertinent part, that, “[t]he purpose of a hearing under this section is to provide the claimant with an opportunity to introduce into the record of proceedings, in person, any available evidence, arguments, or contentions which he or she considers important to the case.” One commenter asserted that the term “contention” is redundant of the term “argument,” and that VA adjudicators often dismiss testimonial evidence as “mere contentions”, citing Hatlestad v. Derwinski, 1 Vet. App. 164, 169-70 (1991).

Merriam-Webster's Collegiate Dictionary, 269 (11th ed. 2006), defines “contention” as “a point advanced or maintained in a debate or argument”. The term “argument” includes the term “contention”. We agree that it is unnecessary to include both terms in § 5.82(b) and we propose to remove the word “contentions”.

We propose to make an additional change to initially proposed § 5.82(b) by removing the last sentence, that states, “[t]estimony at a hearing will be under oath or affirmation.” We propose this change because the requirement that the testimony be under oath or affirmation is also found in § 5.82(d)(2), where it is more clearly expressed. Including this requirement in § 5.82(b) is redundant and unnecessary. We propose to revise the title of this paragraph to remove the reference to the requirement for oath or affirmation.

Initially proposed § 5.82(d)(1) stated, in pertinent part, “[t]he employee or employees will establish a record of the hearing and will issue a decision after the hearing”, which is substantially similar to the language in current § 3.103(c)(1). One commenter asserted that the phrase “a record of the hearing” is too vague and urged VA to clarify that testimony cannot be “manipulated, paraphrased, or summarized like minutes of a meeting.” The commenter urged that the witness's exact words and complete statements be made a part of the record.

VA normally transcribes the recording of the hearing and includes the transcript of the hearing in the record of evidence. However, it would be inappropriate to require by regulation that a transcript be prepared for every hearing. There are several reasons why the recording of the hearing may not be transcribed. For example, the VA employee conducting the hearing may determine that all benefits sought should be granted. If all benefits sought are granted, there is no reason to expend resources to transcribe the recording of the hearing or to delay the promulgation of the decision while waiting for the recording to be transcribed. The decision granting the benefit would summarize the hearing testimony. Also, the claimant may withdraw the claim during the conduct of the hearing. In such situations, there is no need for a transcript. In either of these examples, the claimant would gain nothing by the VA's expenditure of resources in transcribing the recording of the hearing. Finally, VA puts a transcript of the hearing in the claims file if the claimant or beneficiary initiates an appeal from a decision. The verbatim testimony is thus part of the evidence of record when the claimant or beneficiary seeks appellate review. To require by regulation that a transcript of the recording of every hearing be prepared would not assist the claimant and would unnecessarily expend VA resources.

Currently, VA prepares a transcript of the hearing if the VA employee Start Printed Page 71075conducting the hearing needs one in making a decision on the claim, if the claimant (or the claimant's representative) requests a copy, or if the claim is to be sent to the Board of Veterans Appeals. If the recording of the hearing is not transcribed, the recording of the hearing is placed in the claims folder so that if the hearing needs to be transcribed later, the tape or other recording medium is available. The current procedures adequately protect the claimant's interests while providing VA with greater efficiency in using our resources. We propose to make no changes based on this comment.

One commenter urged VA to require in § 5.82(d)(3) that adjudicators conducting hearings make express credibility findings on the record concerning the sworn, personal hearing testimony of claimants and other witnesses. The commenter averred that VA hearing officials deciding claims regularly fail to state the reasons for rejecting sworn hearing testimony. The commenter asserted that a requirement that hearing officers make specific credibility findings is necessary to compel hearing officers to include the contribution of his or her assessment of the credibility of hearing testimony in the statement of reasons for a decision.

We decline to make this suggested addition. Such findings are already required by initially proposed § 5.83(a), which requires VA to send each claimant a decision that explains, “[if] a claim is not fully granted, the reason for the decision and a summary of the evidence considered. . . .” Additionally, if VA were to specifically require VA personnel conducting hearings to determine the credibility of oral hearing testimony, the requirement could be misconstrued as emphasizing that type of testimony over others, or that they need not make credibility findings on other types of testimony or evidence. A finding as to credibility of testimony, or of any evidence, is fundamental to all weighing of evidence. See Barr v. Nicholson, 21 Vet. App. 303, 310 (2007) (“On remand, the finder of fact must consider the credibility and weight of Mr. Barr's statement, and any other competent lay or medical evidence”); see also, Layno v. Brown, 6 Vet. App. 465, 469 (1994) (Credibility is a matter to consider after evidence or testimony has been admitted). We agree with the commenter's statement that testimony is evidence, and that the Secretary must consider “all information and lay and medical evidence of record”. 38 U.S.C. 5107(b) (Benefit of the doubt). That does not mean that regulation must specifically require credibility findings as to hearing testimony. The lack of a finding of credibility of hearing testimony, as with a failure to assess the credibility of any testimony or evidence, can be the basis on appeal of an assertion that VA failed to state its reasons or bases for a decision. We propose to make no changes based on this comment.

Initially proposed § 5.82(e)(1) stated, “Normally, VA will not schedule a hearing for the sole purpose of receiving argument from a representative.” This was based on current 38 CFR 3.103(c)(2) which states, “The Veterans Benefits Administration will not normally schedule a hearing for the sole purpose of receiving argument from a representative.” In reviewing § 5.82 to respond to comments, we noted that paragraph (e)(1) provides no guidance on when VA will schedule a hearing for the sole purpose of receiving argument from a representative. Title 38 CFR 20.700(b) states, in pertinent part, “Requests for appearances by representatives alone to personally present argument to Members of the Board may be granted if good cause is shown. Whether good cause has been shown will be determined by the presiding Member assigned to conduct the hearing.” We believe that applying a good cause standard to hearings at the agency of original jurisdiction would be fair to claimants and beneficiaries, and administratively efficient for VA, so we propose to add that standard to paragraph (e)(1).

We propose to reorganize initially proposed § 5.82(e)(3) (now renumbered as paragraph (e)(4)) to make clear that it addresses failure to report for a hearing under any circumstance. Paragraph (e)(4)(i) addresses failure to report without good cause Paragraph (e)(4)(ii) addresses failure to report with good cause and the responsibility of the claimant or beneficiary to request rescheduling.

One commenter urged VA to add a provision to § 5.82(e) on rescheduling hearings upon receipt of a reasonable request from a claimant or beneficiary. VA's long-standing practice has been to inform claimants and beneficiaries, in the letter scheduling their hearing, how to contact VA to reschedule the hearing. Based on the comment, we have added a new paragraph (e)(3) stating, “If a claimant or beneficiary is unable to attend a scheduled hearing, he or she may contact VA in advance to reschedule the hearing for a date and time which is acceptable to both parties.”

Similarly, another commenter argued that VA should provide a claimant with a right to reschedule a hearing if the claimant missed the originally scheduled hearing for good cause. In our view, a request to reschedule is reasonable if the claimant failed to report for good cause. VA's long-standing practice has been that if a claimant fails to attend the hearing with good cause, VA will reschedule the hearing. We agree with the commenter that it would helpful to include this in paragraph (e) and we now propose to add such language.

We reviewed initially proposed § 5.82 in connection with this comment, and determined that it might be unclear whether the hearing procedures discussed in paragraphs (a) through (e) apply to “predetermination hearings” under paragraph (f). We propose to revise (f) by adding the word “Additional” before the paragraph heading. It now reads, “Additional requirements for hearings before proposed adverse actions.” The paragraph provides that before VA takes adverse action regarding a benefit, VA will give the beneficiary notice of a right to a hearing, and that the beneficiary has 30 days to request a hearing. Reading the heading and the paragraph together makes it clear that the provisions of (f) modify the hearing procedures discussed in paragraphs (a) through (e). The modifications consist of VA's unique notice requirement and the beneficiary's 30-day limit to request a hearing. See discussion of distinction between paragraphs (a) and (f), above.

We have restated the rule in initially proposed paragraph (f) regarding the conditions under which VA will hold a hearing prior to adverse action so it reads in the affirmative, rather than in the negative. That is, stating “VA will conduct a hearing . . . only if . . .”, rather than, “VA will not conduct a hearing . . . unless . . . .” This change is consistent with part 5's preferred style of stating rules in the affirmative. We have also removed the second sentence of initially proposed paragraph (f)(1) providing examples of good cause for failing to report for a hearing. It is the same as the last sentence of paragraph (e)(3). Paragraph (e) provides the rights and responsibilities of the beneficiary regarding hearings generally. The provision need not be repeated in paragraph (f), which comprises hearing requirements in addition to those elsewhere in § 5.82.

One commenter noted that initially proposed paragraph (f)(3) requires that VA “send the notice of the time and place for the predetermination hearing at least 10 days before the scheduled hearing date” and urged that VA provide similar advanced notice for hearings conducted under paragraph Start Printed Page 71076(d). We agree with this suggestion. VA usually provides at least 10 days advanced notice of hearings, and we propose to revise paragraph (d) to provide the same 10 days notice as contained in paragraph (f).

One commenter urged VA not to use the term “predetermination hearing” in § 5.82(f), which describes hearings conducted after VA proposes to take some adverse action affecting benefits, but before rendering a decision. The commenter noted that a claimant may request a hearing at any time, including prior to the initial decision on a claim, which would also be a “predetermination hearing.” The commenter did not offer any suggestion as to what term VA should use in its place.

We agree that any hearing preceding a determination can accurately be called a “predetermination” hearing. The term “predetermination hearing” has been used in current regulation 38 CFR 3.105(i) for many years and is widely understood by VA adjudicators, veterans, and veterans' representatives. It is clear in § 5.82(f) what the term means and we are not aware of any other term that would be more clear to readers. Nonetheless, it is jargon and not essential. A hearing is a hearing. The same rules apply to the conduct of the hearing described in paragraph (f) as to any other hearing. The decision maker must give the same consideration to the testimony and evidence presented as with any other hearing. The unique effect of a request for a hearing prior to a possible adverse decision is that VA will not reduce or discontinue the benefit payments prior to hearing. It is this relationship of the request for a hearing to the timing of any action resulting from the decision whether to reduce or discontinue a benefit that gave rise to the term “predetermination” hearing. This rule is in the last sentence of § 3.105(i)(1), and initially proposed § 5.82(f)(4) restated it. The rule applies regardless of whether the hearing has a special name. For consistency throughout § 5.82, and to avoid any confusion of the sort the commenter highlighted, we propose to remove the modifying term “predetermination” prior to the term “hearing” in paragraph (f).

Initially proposed § 5.82(f)(3) stated that VA will send the notice of the time and place for a predetermination hearing at least 10 days beforehand and that this requirement may be waived by the beneficiary or representative. This 10-day notice provision is currently contained in 38 CFR 3.105(i). Three commenters asserted that this 10-day advanced notice period is often not adequate. They referred variously to the time it takes to deliver the mail, the distance a claimant or beneficiary must travel, and the time required to gather the funds or arrange for time off work to attend a hearing. One commenter urged VA to adopt a rule providing for “negotiated appointments acceptable to both parties, with at least 30 days' notice unless otherwise agreed.”

Regarding the suggestion that we revise initially proposed § 5.82(f) to provide 30 days advanced notice of the date of the hearing; we decline to make this change. Ten days is sufficient time for beneficiaries to receive VA's scheduling letter and, if necessary, to contact VA to reschedule. VA already has the inherent discretion to resolve situations where a beneficiary needs more time. For example, if VA's letter arrived while the beneficiary was on vacation and the beneficiary was unable to reschedule before the hearing date, VA would reschedule the hearing when the beneficiary contacted VA. Second, we note that the 10-day provision has been contained in § 3.105(i) for over 15 years and there have been few, if any, complaints from beneficiaries about this provision. For these reasons, we propose to make no changes based on this comment.

We propose to revise initially proposed paragraph (f)(4), removing the term “final” before “decision”. The decision that follows a proposal to reduce or discontinue a benefit is not a “final” decision as VA defines “final” in § 5.1. Like any other decision on entitlement to benefits, it is subject to appeal and can become final by expiration of the time allowed to appeal the decision, or because the Board of Veterans' Appeals has ruled on an appeal from the decision. The decision to which paragraph (f)(4) refers is the type of decision described in § 5.160 as “binding”. Compare preamble to § 5.160, with § 3.104(a) (final and binding decision).

In the NPRM, we initially proposed not to include in § 5.82 the last sentence of current § 3.103(c)(2). We stated in the preamble of the NPRM that the provision is redundant because 38 U.S.C. 5103A(d), enacted in 2000, requires VA to provide a medical examination if it is “necessary to make a decision on the claim”. This § 5103A(d) examination or opinion provision is now § 5.90(c)(4)(i), which derives from § 3.159(c)(4).

One commenter objected to our proposal not to include the provision concerning a visual examination by a physician in part 5. The commenter stated that there is significant difference between a claimant's right to request a visual examination during a hearing and a claimant's right to request an examination under 38 U.S.C. 5103A(d). The commenter expressed the opinion that under current § 3.103(c)(2), a claimant has the right to have a VA physician “read into the record” the physician's relevant observations but under 38 U.S.C. 5103A(d) there is no guarantee that VA will grant a request for a VA examination. The commenter also noted that under VA's current regulation implementing 38 U.S.C. 5103A(d), 38 CFR 3.159, now § 5.90, VA does not provide examinations for veterans seeking to reopen denied claims. The commenter urged VA to revise § 5.82 to authorize a visual examination by a physician.

Initially, we note that the claimant did not have a right to have a VA physician “read into the record” the physician's relevant observations, but could request a visual examination by a physician. Provision of the visual examination was at the discretion of the VA. The portion of the regulation providing for a visual examination by a physician at a hearing was included in the regulation at a time when the regional offices had physicians (medical members) on the staff, usually as part of the rating board. At that time, the medical member would either attend the hearing or be available nearby within the regional office if needed to conduct the visual examination. Regional offices rarely have a medical member on rating boards any more. Few regional offices have the capability of providing the visual examination by a physician at the hearing location. The provision for a visual examination during the hearing is an anachronism and no longer practical.

Additionally, while there is no “guarantee” that VA will grant a request for a VA examination, the language of 38 U.S.C. 5103A(d) (“necessary to make a decision on the claim”) provides sufficient assurance that VA will obtain needed medical examinations. If an examination is necessary to make a decision on the claim, one will be scheduled. If an examination is not necessary to make a decision on the claim, a visual examination at a hearing would be unlikely to assist the claimant. We also note that in most cases, it is preferable to have a claimant examined by a physician in a medical office (where testing equipment and privacy is available), rather than in a hearing room at a VA regional office. For these reasons, we propose to make no changes to initially proposed § 5.82 based on this comment.

Regarding the commenter's suggestion that VA revise current §§ 3.159 or 5.90 Start Printed Page 71077to require VA to provide examinations for veterans seeking to reopen denied claims, this suggestion was made in comments submitted during the initial promulgation of § 3.159. VA declined to make such a change, because it would not be an appropriate “expenditure of its finite resources” to do so. For the reasons stated in that rulemaking (66 FR 45628 (August 31, 2001)), we decline to revise § 3.159 or its part 5 counterpart, § 5.90.

§ 5.83 Right to Notice of Decisions and Proposed Adverse Actions.

One commenter asserted that the use of the phrase, “the payment of benefits or the granting of relief” could be interpreted as more narrow than the provision in 38 U.S.C. 5104(a), which reads, in pertinent part, “[i]n the case of a decision by the Secretary under section 511 of this title affecting the provision of benefits to a claimant, the Secretary shall, on a timely basis, provide to the claimant (and the claimant's representative) notice of such decision.” The commenter urged VA to replace the phrase “the payment of benefits or the granting of relief” with “the provision of benefits”.

We disagree that the phrase “the payment of benefits or the granting of relief” would permit VA not to give notice of decisions of which it would have to give notice if the regulation used the statutory language. The proposed language is taken verbatim from 38 CFR 3.103(b)(1) and is well understood to include VA decisions that involve monetary benefits and those that do not. Switching to the statutory language “provision of benefits” could be misinterpreted to mean only decisions involving monetary benefits. We therefore decline to make the change suggested by this commenter.

The same commenter also noted that the use of “proposed adverse action” in paragraph (a) was confusing. The commenter urged VA to strike the reference to proposed adverse actions and revise the second sentence of paragraph (a) for clarity.

In reviewing initially proposed § 5.83 in response to this comment, we have determined that paragraphs (a) and (b) should be reorganized for clarity. We have restructured these paragraphs so that (a) covers only notices of proposed adverse actions and (b) covers only notices of decisions. Consistent with this structure, we have listed the elements which are contained in each type of notice.

Another commenter stated that initially proposed § 5.83(b) (redesignated as paragraph (a)) would reduce the time VA allows to submit evidence from 1 year to 60 days, which is disadvantageous to veterans. The commenter apparently has mistaken the time VA allows for a beneficiary to submit evidence in response to a notice of a proposed adverse action with the time VA allows for a claimant to submit evidence in support of a claim for benefits. Compare 38 CFR 3.159(b) with 38 CFR 3.103(b)(2). Initially proposed § 5.83 is based on § 3.103, which also states that the time period for a claimant to submit evidence in response to a notice of adverse VA action is 60 days. Therefore, we propose to make no changes based on this comment.

In responding to these comments, we determined that the initially proposed rules failed to explain our omission of the substantively identical provisions found in paragraphs (d), (e), (f), and (h) of 38 CFR 3.105, which state that before notice of a proposed adverse action is sent to a beneficiary, “a rating proposing severance will be prepared setting forth all material facts and reasons.” We believe that these provisions confer no rights or duties and relate purely to internal agency procedures, so it is not necessary to include them in VA's regulations. The due process guarantee of advance notice contained in the second sentences of those paragraphs is included in proposed § 5.83(a).

§ 5.84 Restoration of Benefits Following Adverse Action.

One commenter asserted that both the current and proposed rules were “contrary to law” because they imposed a 30-day deadline in which the beneficiary is required to contest the decision in order for VA to retroactively restore benefits. The commenter noted that under 38 U.S.C. 7105(b)(1), a beneficiary has 1 year to initiate a corrective action for an erroneous decision or action by VA. This would be done by filing a Notice of Disagreement with the VA decision. The commenter also asserted that “any action based on nonexistent facts or false information provided by a third party would be void ab initio [from the beginning], and there is no time limit for requesting corrective action,” citing 38 U.S.C.A. 5109A(b) and 38 CFR 3.105(a). The commenter also noted that 38 CFR 3.156(b) and 3.400(q) require that when VA reverses a decision on appeal, the effective date will be set as if the decision had not been rendered.

We agree with the commenter that 38 CFR 3.156(b) and 3.400(q) require that when VA reverses a decision, the effective date will be set as if the decision had not been rendered. The intent of § 3.103(b)(4) (see 66 FR 20220 (Apr. 20, 2001)) for an explanation of the intent of this section) was not to deprive beneficiaries of the proper effective date for restoration of benefits nor has VA applied the rule so as to limit the rights of beneficiaries in this manner. Rather, § 3.103(b)(4) serves the purpose of allowing VA to reverse an erroneous decision without requiring the beneficiary to file a Notice of Disagreement. This relieves the beneficiary of the burden of preparing and filing a written Notice of Disagreement (including the elements required under 38 CFR 20.201, “Notice of Disagreement”). The process under § 3.103(b)(4) does not replace the appeal process described in 38 U.S.C. 7105. Rather, it provides a convenient and more efficient alternative means for beneficiaries to have their benefits restored. We therefore disagree that current § 3.103(b)(4) or initially proposed § 5.84 is contrary to law.

However, in order to avoid any confusion that initially proposed § 5.84 limits the rights of beneficiaries as described above, we are adding the following language as a new paragraph (a)(2), “[t]his paragraph (a) does not limit the right of a beneficiary to have benefits retroactively restored based on evidence submitted within the 1-year appeal period under § 5.153, `Effective date of awards based on receipt of evidence prior to end of appeal period.' ”

Also to avoid confusion, we have inserted the word “written” before “information” in § 5.84 to distinguish that term from “oral statements”.

VA Assistance in Developing Claims.

In the NPRM, we stated:

Title 38 CFR 3.159 is currently the subject of a separate VA rulemaking which will implement changes made by section 701 of Pub. L. 108-183, 117 Stat. 2670. When that rulemaking is complete, we plan to repeat the language of the amended § 3.159 as § 5.90. We therefore propose in this rulemaking to reserve space for proposed § 5.90.

(70 FR 24683 (May 10, 2005))

VA has published the final rule amending 38 CFR 3.159 and we are now inserting the current language of § 3.159 as § 5.90 (RIN 2900-AM17, “Notice and Assistance Requirements and Technical Correction”, 73 FR 23353, Apr. 30, 2008, with amendment 73 FR 24868, May 6, 2008; based on § 3.159). We propose to remove the definitions of competent medical evidence and competent lay evidence, revise the definition of competent expert evidence, and place the definitions in § 5.1. We have reorganized § 5.90 accordingly and changed the references to part 3 regulations to refer to part 5 regulations.Start Printed Page 71078

In addition to the provisions of § 3.159, we propose to include in § 5.90 the provisions of current § 3.109(a). These provisions relate closely to the other provisions in § 5.90 and so it is logical to move them into that rule. However, we propose to clarify the sentence, “Information concerning the whereabouts of a person who has filed a claim is not considered evidence” in § 5.90(b)(3). This sentence means that if a claimant submits information or evidence concerning his or her mailing address, that is not considered information or evidence under paragraph (b). We propose to revise the sentence accordingly to clarify its meaning. The only other change we propose is that we have simplified the scope sentence stated in § 3.109(a)(2) so that it simply says that the rule applies to all part 5 applications.

Subsequent to the publication of proposed § 5.90, section 504 of Public Law 112-154 (2012) amended 38 U.S.C. 5103 by removing the requirement that a claimant submit “a complete or substantially complete application” as a prerequisite to VA providing notice of information and evidence needed to substantiate the claim. Section 504 also amended § 5103 to relieve VA of the requirement to provide such notice “to any claim or issue where the Secretary may award the maximum benefit in accordance with this title based on the evidence of record.” We propose to include these statutory changes § 5.90.

Section 505 of Public Law 112-154 (2012) extensively amended 38 U.S.C. 5103A regarding VA's duty to assist claimants. VA plans to conduct a rulemaking to implement § 505 in part 3 and will incorporate those part 3 regulations into part 5.

§ 5.91 Medical Evidence for Disability Claims.

One commenter urged VA to replace the word “may” with “shall,” concerning the acceptance of private medical evidence, because this would be consistent with the Congressional intent behind 38 U.S.C. 5125. Although that statute uses the word “may,” the commenter asserts that Congress meant to give VA authority to accept private medical examination reports in place of VA examination reports, but that once VA has determined to accept such private reports generally, it cannot accept or reject such reports “on a whim”. The commenter asserted, “[s]uch unwarranted discretion defeats the very purpose of the rule.”

We disagree that Congress' intent was merely to give VA authority to accept private medical examination reports generally. Rather, the plain language of 38 U.S.C. 5125 allows VA discretion to accept or reject such evidence in each individual case. We do not agree that this process defeats the purpose of the rule. This process allows VA the necessary discretion to reject private reports which, although technically “adequate for purposes of adjudicating a claim”, VA considers to be potentially biased or unreliable. We therefore decline to make the change suggested by this commenter.

Another commenter suggested that VA revise § 5.91 to require VA regional offices to “give a clear and precise explanation for why the claimant's medical evidence is not sufficient to render a VA examination unnecessary.” We decline to adopt this suggestion because such an explanation would be of little use to claimants. VA has a duty to make reasonable efforts to obtain the evidence necessary to properly decide each claim. In addition to the medical evidence provided by the claimant, VA will schedule a VA examination if one is “necessary to decide the claim.” See 38 U.S.C. 5103A. See also § 5.90. VA obtains evidence from multiple sources in most cases and it would be unduly burdensome, and a waste of resources, for VA to be required to explain why it has obtained every piece of evidence. VA is required to explain the reasons for any decision adverse to the claimant and to include a summary of the evidence considered in making the decision on the claim. See 38 U.S.C. 5104. See also § 5.83. These procedures adequately inform the claimant of the relative probative value to any medical evidence submitted and we propose to make no changes based on this comment.

§ 5.92 Independent Medical Opinions.

In initially proposed § 5.92 we repeated the content of current 38 CFR 3.328 without change.

One commenter expressed concern that § 5.92 could be confusing by implying that VA will obtain independent medical opinions in place of VA medical examinations. We do not agree and we propose to make no changes based on this comment. Initially proposed § 5.92 did not state or imply that we would not comply with the provisions of § 3.159. The evidence obtained under the provisions of § 5.92 will generally supplement the other medical evidence with an independent medical opinion “[w]hen warranted by the medical complexity or controversy”.

Another commenter noted that § 5.92(a) gave VA authority to obtain an independent medical opinion when “warranted by the medical complexity or controversy” while paragraph (c) stated that, in order for VA's Compensation and Pension Service to approve requests for such opinions, the claim must pose “a medical problem of such obscurity,” complexity, or controversy. We agree that it would be logical to state the criteria for such opinions using the same terminology in both paragraphs and we have removed the word “obscurity” from paragraph (c). Both paragraphs now use the language used in the authorizing statute, 38 U.S.C. 5109.

Another commenter urged VA to revise § 5.92 to require that VA provide claimants with copies of all communications between the VA regional office and the institution providing the independent medical opinion. The commenter asserted that, “[s]uch a requirement for openness . . . will ensure the fairness and integrity of this new procedure.”

As a preliminary matter, we note that the procedure to obtain an independent medical opinion is not new and has been contained in § 3.328 since 1990. See 55 FR 18602 (May 3, 1990). VA is required by 38 U.S.C. 5109 to furnish the claimant with notice that an advisory opinion was requested and also a copy of the opinion when it is received by VA. See § 5.92(d). Furnishing the notice of the intent to request the independent medical opinion and a copy of the opinion to the claimant sufficiently advises the claimant of the status of the independent medical opinion request and results. We do not believe that it is necessary to furnish the claimant with notice or a copy of every communication VA may have with the individual or organization preparing the independent medical opinion. Such communications as a telephone call or an electronic mail message to clarify a typographic error or other minor issues would not assist the claimant in the presentation of the claim. Additionally, records of these communications may be obtained by the procedures discussed earlier concerning the procedures for a claimant to obtain copies of evidence. We propose to make no changes based on this comment.

One commenter urged VA to include a provision in § 5.92(d) allowing a claimant a specified period of time to respond to an independent medical opinion that is adverse to the claimant. We do not believe this change to be necessary because, at the time that VA is seeking the independent medical opinion, the claimant is informed that the independent medical opinion is being sought and also what specific information is being sought. This provides the claimant ample time and Start Printed Page 71079opportunity to seek, obtain, and submit their own independent medical opinion should they wish to do so. We also note that once the claimant receives a copy of the independent medical opinion, even if the claim has been denied, he or she has the opportunity to respond. We propose to make no changes based on this comment.

§ 5.93 Service Records Which Are Lost, Destroyed, or Otherwise Unavailable

One commenter asserted that the force of § 5.93 is diminished due to the confusing use of terminology. The commenter argued that the phrase, “alternative evidence” should be replaced with, “evidence from alternative sources.” Upon review of the regulation, we propose to change the regulation according to the commenter's suggestion. As noted by the commenter, the evidence sought may be a copy of the missing evidence, not alternate evidence.

§ 5.99 Extensions of Certain Time Limits

In the AL82 NPRM, we inadvertently failed to include provisions contained in current 38 CFR 3.109(b). We are doing so now in § 5.99. This rule restates § 3.109(b) without substantive change. We are clarifying in § 5.99(c) that while late requests for extensions will be permitted under some circumstances, as is currently the case, no extension of time will be granted after VA has made a decision on the claim to which the information or evidence relates and the time to appeal that decision has expired.

§ 5.100 Time Limits for Claimant or Beneficiary Responses

One commenter felt that VA should specify that the holidays referenced in the regulation are Federal holidays. We agree and have added the word, “Federal” before holidays in § 5.100(a).

One commenter felt that this regulation should specify whether the date of mailing or the date of receipt by VA would be the ending date of the applicable time period provided to a claimant to respond to a VA communication. We propose to make no changes based on this comment. This regulation is intended to specify how to calculate a time limit. Within part 5, where a response is required to be submitted within a certain time, all the sections specify how the ending date of the applicable time period provided to a claimant will be calculated. This is generally the date of receipt by VA of whatever evidence or information is requested, if received within the applicable time period. To include the ending date information here would be redundant.

One commenter felt that VA should revise this regulation since the commenter felt that sometimes a VA letter may be signed after the last mail pickup for that day. The letter would not actually be mailed until the following workday. The commenter felt that this rule provided for a “convenient and arbitrary assumption that disfavors claimants.” A second commenter agreed, stating that the word “considered” should be removed from the second to last sentence in order to avoid having VA rely on a date that it may know to be erroneous.

We propose to make no changes based on this comment. This regulation provides that the first day of the specified time period will be excluded in computing the time limit for any action required of a claimant. This ensures that the claimant is generally provided the full time period. Additionally, the time periods provided allow ample time for the claimant to respond. While it is true that the 1-day grace period provided by not counting the date of the letter in the time period does not provide for those situations where the letter is dated on a Friday afternoon, but not actually posted until Monday, the claimant still has been provided sufficient time to respond to any requests for information or evidence.

One commenter urged VA to adopt a system of notice for determining the time periods for claimants or beneficiaries' responses similar to that found in 41 U.S.C. 609(a)(3), which provides that the period of time begins running when the notice has been received. VA currently begins the period of time from the date of mailing as shown by the date of the letter sent to a claimant or beneficiary. The commenter felt VA could better afford the minor expense of certified mail than could the claimant or beneficiary.

VA communicates with claimants and beneficiaries at various stages in the adjudication process, using various means. It would not be appropriate to regulate the manner of all such communications because VA needs discretion to use the most effective means of communications and because such means may change over time. Additionally, VA routinely sends hundreds of thousands of pieces of mail to veterans, claimants, and beneficiaries, as well as their representatives. While the burden for sending any one piece of mail by certified mail is small, the expense and time required to send all notices by certified mail would be overwhelming, both in increased monetary cost and human resources expended. Routinely sending certified mail to veterans, claimants, or beneficiaries is not necessary, nor, in most situations, helpful to the veterans, claimants, or beneficiaries. VA provides sufficient time for a veteran, claimant, or beneficiary to respond to the communications we send them. It is not burdensome for the veteran, claimant, or beneficiary to respond, when necessary, within the time limits specified in the communication. The additional two or three days that would be provided by starting the time period from date of receipt instead of date of mailing would rarely assist a veteran, claimant, or beneficiary. For these reasons, we decline to make any changes based on this comment.

§ 5.101 Requirement To Provide Social Security Numbers

Initially proposed § 5.101 explained the statutory requirement that claimants and beneficiaries must provide VA with their Social Security numbers and their dependents' numbers.

One commenter urged VA to excuse those claimants or beneficiaries who, for good cause, fail to provide their Social Security number. The commenter urged that, if VA reduces or discontinues benefits, it should resume the benefits retroactively from the effective date of the reduction, if the person had good cause for the failure.

We note that, as stated in initially proposed § 5.101(f), “A claimant or beneficiary is not required to provide a Social Security number for any person to whom a Social Security number has not been assigned.” Other than this, we are unaware of any reason which would constitute good cause for a claimant or beneficiary failing to provide VA with his or her Social Security number, nor does the commenter offer any such example. We therefore propose to make no change based on this comment.

Initially proposed § 5.101(d) stated, “[i]f a claimant or beneficiary provides VA with the requested Social Security number, VA will resume payment of benefits at the prior rate, effective on the date VA received the Social Security number, provided that payment of benefits at that rate is otherwise in order.” One commenter noted that under paragraph (d), if a claimant or beneficiary failed to furnish the required Social Security number within the deadline but later provided it, VA would pay benefits only from the date it received the Social Security number. The commenter noted that § 5.101 would treat claimants and beneficiaries disparately in that if they ultimately provided VA their Social Security Start Printed Page 71080number, the former would have benefits granted from the date of claim, while the later would have benefits restored only from the date he or she provided the number. The commenter objected to this disparate treatment, asserting:

When a claimant receiving benefits is requested to provide a social security number and does not promptly comply, VA may certainly administratively suspend payment (`terminate the payment') of benefits pursuant to § 5101(c), but the benefits should be resumed effective the date of suspension if the requested information is provided within 1 year. Such a rule would be consistent with the time an applicant has to provide the social security number under sections 5102(c) and 5103(b) and the general rule in 38 CFR 3.158 (2004) that a claim will be considered abandoned only if the requested information is not provided within 1 year.

The commenter asserted that this rule would be contrary to 38 U.S.C. 5102 and 5103, which do not explicitly authorize VA to reinstate benefits only from the date a beneficiary ultimately provides VA his or her Social Security number. In reviewing paragraph (d) in response to this comment, we noted that VA cannot “resume” payments to a claimant, since VA has not begun paying such a person. We therefore propose to remove the term “claimant” from this paragraph, so that it would relate only to beneficiaries and not to claimants.

Regarding the disparity noted by the commenter, we first note that it is not inconsistent with the relevant statutes, 38 U.S.C. 5101-5103. Sections 5102-5103 only cover claims, not running awards, so they are not germane to the disputed provision. Section 5101(c)(2) states that “the Secretary shall deny the application of or terminate the payment of compensation or pension to a person who fails to furnish the Secretary with a social security number required to be furnished pursuant to paragraph (1) of this subsection. The Secretary may thereafter reconsider the application or reinstate payment of compensation or pension, as the case may be, if such person furnishes the Secretary with such social security number.”

This statute, and its implementing regulation 38 CFR 3.216, leave a gap regarding the effective date for the reinstatement of benefits. VA's long-standing practice has been to resume benefits effective the date the beneficiary ultimately provides the social security number. If the rule were changed as the commenter urges, VA would in such cases have to make retrospective determinations, in some cases going back many years, on whether the former beneficiary actually met all the entitlement criteria for the benefit during the entire retroactive period. This would consume considerable VA resources when compared with the rule proposed in § 5.101(d). Furthermore, there is no indication that our proposed rule creates a hardship for beneficiaries. For these reasons, we propose to make no change based on this comment.

Initially proposed § 5.101(e), entitled, “Claimant's application for VA benefits ”, stated, “[i]f 60 days after VA requests a Social Security number, the claimant fails either to provide the requested Social Security number or to show that no Social Security number was assigned, VA will deny the claim.” One commenter objected to this provision, noting that it did not include a provision allowing a claimant 1 year to submit his or her Social Security number. The commenter noted that 38 U.S.C. 5102 and 5103 allow a claimant 1 year to provide the information needed to complete an application. The commenter noted that while VA has the authority to deny the application earlier than the expiration of the 1 year period, if the information is received no later than 1 year after VA's request, VA must reconsider the application as if the information had been furnished on the application.

After reviewing the applicable statutes and VA's other regulations, we agree with the commenter that it would be appropriate to clarify that a claimant has 1 year in which to submit the requested Social Security number. We therefore propose to add a sentence to § 5.101(e), based on a provision from § 5.90(b)(1)(i) (based on current 38 CFR 3.159(b)(1). This new sentence states, “[i]f VA denies the claim or denies benefits for the dependent, and the claimant subsequently provides the Social Security number no later than 1 year after the notice, then VA must readjudicate the claim.”

In making this proposed change based on the comment, we noted that the 60-day deadline in 38 CFR 3.216 applies only to beneficiaries, not to claimants. In order to be consistent with § 5.90(b)(1)(i), we propose to revise the 60-day period in § 5.101(e) to 30 days. In addition to being consistent with § 5.90(b)(1)(i), we believe that 30 days is sufficient time for claimants to provide VA with requested Social Security numbers.

Subsequent to the publication of proposed § 5.101, section 502 of Public Law 112-154 (2012) amended 38 U.S.C. 5101 by adding a new paragraph stating if an individual has not attained the age of 18 years, is mentally incompetent, or is physically unable to sign a form, a form filed under paragraph (1) for the individual may be signed by a court-appointed representative, a person who is responsible for the care of the individual, including a spouse or other relative, or an attorney in fact or agent authorized to act on behalf of the individual under a durable power of attorney. If the individual is in the care of an institution, the manager or principal officer of the institution may sign the form. The term `mentally incompetent' with respect to an individual means that the individual lacks the mental capacity—

  • To provide substantially accurate information needed to complete a form; or
  • to certify that the statements made on a form are true and complete.

Section 502 also added Taxpayer Identification Number (TIN) to the Social Security number requirement in § 5101. We have updated § 5.101 to reflect these statutory changes.

§ 5.103 Failure To Report for VA Examination or Reexamination

The preamble to initially proposed § 5.103 stated that part 5 would not repeat § 3.655(a) because it is unnecessary. 70 FR 24680, 24685, (May 10, 2005). To clarify, that statement correctly applies only to the first sentence of § 3.655(a). The examples of good cause in § 5.103(f) derive from the second sentence of § 3.655(a).

One commenter felt that the examples provided in the regulation to determine what constitutes “good cause” for failure to report for a scheduled VA examination were too narrow and may lead VA to apply too high a standard to determine what constitutes “good cause”.

The examples of “good cause” for failure to report for a scheduled VA examination in initially proposed § 5.103(f) are the same examples included in the full revision of § 3.655(a), effective December 31, 1990. 55 FR 49520, Nov. 29, 1990. The last sentence of § 5.103(f) is new and requires that VA consider each reason given for missing a VA examination on a case-by-case basis. Use of the examples that have been in place since 1990, together with the last sentence, ensures that determinations concerning whether the veteran had “good cause” for not reporting to the examination will not change. We propose to make no changes based on this comment.

One commenter recommended not repeating § 3.655 in part 5. We disagree because if VA did not repeat this rule, there would be no rule about how to proceed with adjudication if a claimant Start Printed Page 71081fails to report for an examination that VA has concluded is necessary to decide the claim. The commenter did not state how it would benefit claimants or VA to do without it. Omission of this rule would risk disparate treatment of claimants with similar claims. Avoiding disparate results in similar situations is an important object of regulations. To promote this objective, VA will repeat the rule in part 5.

The same commenter recommended, alternatively, significantly revising the regulation to eliminate several problems he said it has. The commenter asserted there is no logical reason to distinguish between original and other claims. We interpret the comment to mean that VA should treat a failure without good cause to report for a VA examination the same whether the examination is for an original disability compensation claim or for any other claim.

Before 1991, § 3.655 was silent about VA examinations in original disability compensation claims. 38 CFR 3.655 (1990). It applied only to rating action to be taken upon a failure to report for examination of a beneficiary with an ongoing award of benefits, providing for discontinuance of payments. See Wamhoff v. Brown, 8 Vet. App. 517, 520 (1996) (discussing historical § 3.655). VA amended § 3.655 in 1990 to include the requirement to report for VA examination (formerly in § 3.329, which it rescinded) and to provide for unique treatment of original disability compensation claims upon the claimant's failure to report for examination.

There are good and practical reasons to treat the failure to report for an examination in an original claim for disability compensation differently than in other claims. Establishing that a disability is service connected is an element of an original claim for disability compensation that precedes determination of the severity of disability. See Barrera v. Gober, 122 F.3d 1030, 1032 (Fed. Cir. 1997) (explaining “up stream” and “down stream” elements of veterans benefits claims); Grantham v. Brown, 114 F.3d 1156, 1158-59 (Fed. Cir. 1997). Evidence sufficient to decide whether a disability is service connected is likely to be of record without the examination, for example, in the case of a battlefield amputee or a veteran who contracted a presumptively service-connected chronic disease. Even though the evidence of record might be uninformative about the current extent of disability, it is practicable and efficient to decide such a claim on the evidence of record without the examination, even at the risk of an imprecise initial rating. In contrast, current medical information is likely to be lacking and indispensable to deciding the other types of claims named in the regulation.

The predicate for ordering an examination is that the information to be gained from it is necessary to establish entitlement or confirm continued entitlement to a benefit. In other words, if VA has determined that it cannot decide a claim, or an element of a claim, without the evidence derived from the examination, it would squander resources valuable to the entire veteran community to adjudicate the claim, and it preserves resources to deny the claim upon failure to report for the examination without good cause. We therefore propose to not make any changes in response to this comment.

The object of a VA examination in an original disability compensation claim could be to address one of the elements of proof of service connection, see § 5.243, “Establishing service connection for a current disability.”, to ascertain the current severity of disability (a determination VA initially makes upon finding that a disability is service connected), or both. Though the examination could be indispensable to making the most accurate current rating, the benefit to the claimant and practicality of deciding the service-connection element of the claim warrants the unique treatment of original compensation claims.

The same commenter asserted the distinction between types of claims invites fraud. The commenter did not explain how the distinction would invite fraud. We propose to make no changes based on this comment.

The same commenter noted that we had not defined the terms, “other original claim” and “new claim.” The commenter noted that neither term is found in the applicable statutes. The commenter felt this section should be revised so that the terms are understood by claimants and so that the terms fit within the regulatory framework.

In § 5.57, we defined several types of claims. We defined “original claim” in § 5.57(b) as “the first claim VA receives from an individual for disability benefits, for death benefits, or for monetary allowance under 38 U.S.C. chapter 18.” Although not defined in the statutes, the term “original claim” is found in 38 U.S.C. 5110 and 5113. Consistent with how the term is used in current 38 CFR 3.655(b), our use of “other original claim” was intended to mean any original claim arising under part 5 other than an original disability compensation claim. This would include, for example, a claim for a monetary allowance based on spina bifida under 38 U.S.C. chapter 18. We believe that when read in conjunction with § 5.57(b), this term is logical and understandable.

We have not defined the term “new claim”. Based on this comment, we are removing the term from § 5.103(b)(2). We have determined that the term is not needed to assist the reader in understanding what is intended by this regulation.

In addition to the comment about specific terms, the commenter asserted that VA should revise the regulation so its terms are understandable to laypersons and “fall within the rest of the regulatory framework.” The commenter further asserted that the regulation does not fit within the existing statutory framework and opinions of the [VA] General Counsel. The commenter did not explain how the regulation fails to fit within VA's statutory or regulatory framework or cite any precedent opinion of the General Counsel that the regulation violates. Consequently, we do not find anything in this comment to which VA can respond, and we propose to make no changes to the regulation in response to it.

Finally, the commenter recommended an “escape clause” that precludes “endless good cause.” The object would be to permit VA to decide a claim after a year if a claimant fails to report for an examination for a good cause of indefinite duration, such as being in a coma. The commenter suggested that the regulation should provide for VA to reschedule an examination missed for good cause if that good cause ends within 1 year. We construe the commenter to mean that if the good cause for failure to report for a VA examination persists for more than a year after the date of the examination appointment the claimant did not keep, VA would decide the claim on the evidence of record.

We will not add the suggested provision for five reasons. First, the suggestion would abrogate the distinction between original disability claims and other claims. Whether the claimant failed to report for good cause or no cause, without the examination that VA determined is necessary to decide a claim (other than an original disability compensation claim), the status of the evidence would still be such that VA could not grant the claim without the examination. Second, it is to the advantage of a claimant to suspend the claim until the contingency that prevented the claimant from reporting for the examination is removed, because it leaves the claimant Start Printed Page 71082in control of his or her claim. Third, there is negligible cost or burden to VA to suspend adjudication while the good cause of the claimant's inability to report for an examination persists. Fourth, there is no advantage to VA to decide a claim it has determined lacks crucial evidence. Deciding a claim sooner rather than later under these circumstances is not sufficient reason for the rule the commenter suggests. The failure to report for an examination for good cause is not like the failure to submit requested evidence that VA may consider abandonment of a claim. § 5.136, “Abandoned claims”. Finally, the claimant can always eliminate the need for a VA examination by submitting other medical reports sufficient to serve as a VA examination. § 5.91(a), “Medical evidence rendering VA examination unnecessary.” If the claimant submits a medical report that VA accepts as adequate to the needs of the claim, the examination for which the veteran cannot report would cease to be one necessary to establish entitlement to the benefit claimed. The question of how VA should respond to a failure to report for a necessary VA examination for good cause would be moot.

In reviewing initially proposed § 5.103, we noted that the last two sentences of paragraph (d)(1) stated, “The letter [proposing to reduce or discontinue benefits] must include the date on which the proposed discontinuance or reduction will be effective, and the beneficiary's procedural rights. See §§ 5.80 through 5.83.” We believe it would be more precise to refer the reader to the procedural rights which are listed in such a letter. We therefore propose to restate the sentences as “The notice must include the date on which the proposed discontinuance or reduction will be effective, and the beneficiary's procedural rights as listed in § 5.83(a)(1) through (4).”

In responding to these comments, we noted that the initial NPRM failed to explain our addition of the third sentence of § 5.103(a): “If a claimant or beneficiary, with good cause, fails to report for a VA examination or reexamination, VA will reschedule the examination or reexamination.” Though §§ 3.326(a) and 3.327(a) provide for scheduling VA examinations, and § 3.655 prescribes VA action upon a claimant's failure to report for a necessary examination without good cause, nothing in part 3 specifically states that VA will reschedule an examination a claimant missed with good cause, which is VA's standard procedure. We propose to set forth this important point in paragraph (a).

§ 5.104 Certifying Continuing Eligibility to Receive Benefits

In initially proposed § 5.104(c), we removed the reference to the effective date provisions. In part 5, the effective date provisions are not contained within one regulation, but are located with the regulation concerning the benefit to which the provisions apply. To include these provisions would result in an extremely long and complex paragraph which would not be helpful to the claimants or beneficiaries.

Changes in Terminology for Clarity and/or Consistency

The changes in terminology in this final rulemaking are made primarily for purpose of achieving consistency throughout our part 5 regulations. We replaced the word “evaluation” with “rating;” the term “on behalf of” with “for” or “to or for” where appropriate; and the word “notify” with “send notice to”. As noted earlier, we are removing the modifying term “predetermination” prior to the term “hearing”.

General Evidence Requirements, Effective Dates, Revision of Decisions, and Protection of Existing Ratings AM01

In a document published in the Federal Register on May 22, 2007, we proposed to amend Department of Veterans Affairs (VA) regulations governing general evidence requirements, effective dates, revision of decisions, and protection of existing ratings, to be published in part 5. 72 FR 28770, May 22, 2007. We provided a 60-day comment period that ended July 23, 2007. We received submissions from five commenters: Paralyzed Veterans of America, Vietnam Veterans of America, Disabled American Veterans, and two members of the general public.

§ 5.130 Submission of Statements, Evidence, or Information Affecting Entitlement to Benefits

We propose to revise and reorganize initially proposed § 5.130 for clarity. We propose to add the word “claimant” to the regulation to accurately reflect that this regulation covers submissions by both claimants and beneficiaries. Proposed § 5.130 was derived from § 3.217, which was originally issued to permit modification of existing awards based on electronic and oral reporting of changes, including, but not limited to, income and dependents. See 66 FR 20220, Apr. 20, 2001. The reference to “beneficiary” reflects that original, limited purpose. However, given the broad language of the regulation and our stated intent to cover all types of submissions, we are explicitly including claimants. All claimants and beneficiaries, or their representatives or fiduciaries, must meet all requirements of this section, such as using a specific form providing specific information, providing a signature, or providing a certified statement.

The initially proposed rule referred to “other electronic means” of submissions. We propose to add “that the Secretary prescribes” in paragraphs (a)(1) and (b)(1), to clarify that VA will determine the means or medium of submission it will accept. Additionally, this phrase allows for technological changes over time.

Whereas the initially proposed regulation did not address claimants, it did not distinguish between them and beneficiaries. We propose to revise the regulation to distinguish between the media that claimants may use to file statements, evidence, or information, and the media that beneficiaries may use. VA currently accepts email and oral submissions only from beneficiaries, not from claimants. As revised, paragraph (a) would address submissions from claimants and provide the acceptable media for those submissions. Paragraph (b) would address submissions from beneficiaries and allow submissions, either orally or by email. Paragraph (b)(4) would prescribe VA action upon receipt of an oral statement.

One commenter questioned why we used the word “may” instead of “will” when referring to how VA will use verbal information provided by a beneficiary or fiduciary. We explained in the preamble to the proposed rule that the word “may” was more accurate because “VA may determine that the information or statement needs to be verified through other means”. However, the commenter pointed out that VA will use the evidence, even if it is just to “initiate an investigation to . . . confirm and continue an existing award”, or to contradict prior evidence. We agree with the commenter as the comment applies to the proposed use of “may” in proposed paragraphs (c)(1)(iii) and (2)(v). We propose to change “may” to “will” in redesignated paragraphs (b)(4)(iii) and (iv)(E). We have also decided that the phrase “VA may take action” used in proposed paragraph (b) is more accurately stated as “VA will take appropriate action”, and propose to make this change accordingly. That is because whether VA takes any action that affects entitlement to benefits and what type of action it will take will depend on the content of the submission.Start Printed Page 71083

We also propose to change “affecting the [claimant's or beneficiary's] entitlement to benefits based upon” to “in response to”. This is because a submission might not affect entitlement to benefits. The entire clause now reads, “VA will take appropriate action in response to the statement, evidence, or information.” We have made this change, and the change discussed in the preceding paragraph, in paragraphs (a)(3) and (b)(3), which are parallel provisions applying to claimants and to beneficiaries, respectively.

Based on this comment, we have also decided that it would be more accurate to say that VA will use the statement described in proposed paragraphs (b)(4)(iii) and (iv)(E) “to determine entitlement” as well as “to calculate benefit amounts”. Accordingly, we propose to add the phrase “to determine entitlement” in those paragraphs as redesignated. We also propose to revise this sentence from passive voice to active voice.

Initially proposed § 5.130 used the term “form”. This term is no longer used in part 5. For consistency, we propose to change the term from “form” to “application”, which is currently defined in § 5.1.

Initially proposed § 5.130(a)(1) stated:

It is VA's general policy to allow submission of statements, evidence, or information by email, facsimile (fax) machine, or other electronic means, unless a VA regulation, form, or directive expressly requires a different method of submission (for example, where a VA form directs claimants to submit certain documents by regular mail or hand delivery). This policy does not apply to the submission of a claim, Notice of Disagreement, Substantive Appeal, or any other submissions or filing requirements covered in parts 19 and 20 of this chapter.

In reviewing this paragraph in responding to comments, we determined that the last sentence might be misconstrued to mean that a claimant may not file a claim, a Notice of Disagreement (NOD), a Substantive Appeal, or other item covered in 38 CFR parts 19 or 20 electronically. This was not our intent. Section 5.130 concerns submission of a statement, evidence, or information, and not submission of claims. Filing requirements for an NOD and for a Substantive Appeal are in parts 19 and 20. To avoid this possible misconstruction, we propose to remove this sentence.

§ 5.131 Applications, Claims, and Exchange of Evidence With Social Security Administration—Death Benefits

One commenter noted a typographical error in the preamble language of the initially proposed rule. The error was in the misspelling of the word “belief”. We acknowledge the typographical error but find no need to make the suggested change because the error is not substantive and is contained within the preamble language to the proposed rule which will not be published again.

§ 5.132 Claims, Statements, Evidence, or Information Filed Abroad; Authentication of Documents From Foreign Countries

Initially proposed § 5.132(a) incorrectly grouped together claims, statements, information, and evidence, leading to the absurd implication that, under the terms of the regulation, a claim could be filed in support of a claim. Therefore, we propose to revise § 5.132(a) to separate a “claim” from a “statement, information, and evidence.” Additionally, we reviewed § 3.108, the part 3 provision from which proposed § 5.132(a) is derived, and now propose to reinsert the introductory clause from that section. The introductory clause of § 3.108 explains that certain Department of State representatives in foreign countries are authorized to act as agents for VA. We believe that this information, which was not in initially proposed § 5.132(a), will be valuable to the reader in understanding the agency relationship between the Department of State and VA, and we propose to add it to paragraph (a).

Finally, the regulation text in initially proposed § 5.132 limits evidence of establishing birth, adoption, marriage, annulment, divorce, or death to copies of “public” or “church” records without referencing other religions or religious institutions. We propose to add “other religious-context” records to the regulation text in proposed § 5.132(c)(5) in order to recognize that other religions or religious records, besides church records, may suffice.

§ 5.134 VA Acceptance of Signature by Mark or Thumbprint

One commenter noted that the style of the title of this section as a question was inconsistent with other section titles throughout this part. The commenter suggested an alternative title that “would more closely parallel that of the other proposed sections”, specifically “VA acceptance of signatures by mark or thumbprint”. We agree with the commenter's suggestion and propose to adopt the proposed language as the section title with a slight modification.

The commenter also suggested revising the content of this section. The commenter questioned whether the regulation, as written, would produce unintended results, such as a situation where “an individual who can write his or her name may choose to make a mark or sign by thumbprint”. We recognize the possibility of the hypothetical posed by the commenter, however, it is unlikely that a person who is capable of signing would choose the more burdensome witness/certification process. Even if that occurred, the witness/certification process would be adequate to verify the person's identity and therefore not cause a problem. We decline to make any change based on that comment.

§ 5.135 Statements Certified or Under Oath or Affirmation

One commenter noted that initially proposed § 5.135(b) only applied to evidentiary requirements for claims for service connection, even though we stated in the preamble that we proposed to apply the evidentiary requirements equally to all claims for compensation or pension benefits. We agree with the commenter and therefore propose to remove the restrictive language “for service connection” in § 5.135(b). Any documentary evidence or written assertion of fact filed by the claimant or on his or her behalf, for purpose of establishing a claim, must be certified or under oath or affirmation. However, as the rest of the subsection provides, VA may consider a submission that is not certified or under oath or affirmation if VA considers certification, oath, or affirmation unnecessary to establish the reliability of a document. The language of the subsection has been revised for clarity.

In initially proposed § 5.135(b) we stated, “Documentary evidence includes records, examination reports, and transcripts material to the issue received by VA from State, county, or municipal governments, recognized private institutions, or contract hospitals.” We have determined that the phrase “material to the issue” is inaccurate because this paragraph applies regardless of whether the evidence is material or not. We therefore propose to remove this phrase.

§ 5.136 Abandoned Claims

In the proposed rulemaking, we reserved § 5.136. 72 FR 28770, May 22, 2007. We have now decided to name it “Abandoned Claims”, which is derived from § 3.158(a). We propose to make several changes to the language derived from § 3.158(a) to increase clarity. The scope of the current rule is limited to “an original claim, a claim for increase or to reopen or for purpose of determining continued entitlement”. We propose to expand the scope of § 5.136 to include any claim. This is Start Printed Page 71084consistent with VA's interpretation and use of current § 3.158(a) and makes the rule more concise. The scope of current § 3.158(a) is also limited to “pension, compensation, dependency and indemnity compensation, or monetary allowance under the provisions of 38 U.S.C. chapter 18”. For the same reasons we propose to expand the scope of § 5.136 to include all benefits under part 5. We also propose to change the word “filing” to “receipt” in keeping with our practice of using consistent terminology in part 5.

§ 5.140 Determining Former Prisoner of War Status

One commenter noted a typographical error in proposed § 5.140 (a)(3). We agree with the commenter that there should not be a hyphen between the terms “service” and “department”, and propose to change the language accordingly.

The commenter also pointed out a typographical error in the preamble language concerning this section. The error referred to a mischaracterization of the term “regional office decisions”. We acknowledge the typographical error, but propose not to make the suggested change because the preamble language to the initially proposed rule will not be published again.

In reviewing initially proposed § 5.140, we determined that it would be helpful to readers for all part 5 provisions regarding how VA determines former POW status to be in one section. Therefore, we propose to remove the definition of former POW from § 5.1, “General definitions”, and place it in § 5.140. In combining these two provisions, we have removed redundant material that was contained in initially proposed §§ 5.1 and 5.140.

§ 5.150 General Effective Dates of Awards or Increased Benefits

Several commenters questioned the use of the phrase “date entitlement arose” in place of the phrase “facts found”. In the preamble to the proposed rule, we explained our decision to use “date entitlement arose” by the need for consistency throughout part 5 as well as our understanding that the two terms meant the same thing and are used interchangeably. One commenter did not agree that “facts found” and “date entitlement arose” were interchangeable terms. Rather, the commenter asserted that “facts found” is an alternative to “date entitlement arose” because the latter presumably arises as a matter of law, such as once a claim is actually filed, but is only compensable beginning from a date that is supported by the factual evidence. We believe that the phrase “date entitlement arose” will be clearer to lay persons than the phrase “facts found”, and that § 5.150(a)(2) makes clear that the phrase “date entitlement arose” refers to what the factual evidence shows rather than to procedural requirements such as filing claims. Also, VA regulations have long used “date entitlement arose” without the confusion the commenter described. We note that we do not intend any substantive changes to the determination of the effective dates for benefits based on this substitution of phrases.

The same commenter also felt that it would be unnecessary and possibly confusing to a Veterans Service Representative to pick the latter of either the “date of receipt of the claim” under paragraph (a)(1) or “date entitlement arose” under paragraph (a)(2). The commenter felt that the date of receipt of a claim would presumably always be the later date, since veterans usually experience a disability before filing a claim of entitlement to compensation. The commenter asserted that VA adjudicators sometimes assign “the later effective dates based on the reasoning that increased disability was not factually ascertainable until proven by a VA examination or medical opinion.”

We propose not to make any changes based on this comment because while (a)(2) acknowledges that the date entitlement arose usually precedes the filing of a claim, this may not always be the case. For example, a veteran may file a claim but have it properly denied due to lack of evidence. However, if the veteran later files new evidence that shows that the veteran did not meet all the criteria for a benefit on the date the claim was received, but his or her medical condition changed so that the criteria were satisfied while the appeal was still pending, the date entitlement arose will be after the claim was received. Regarding the assertion that VA adjudicators sometimes assign later effective dates because an increased disability was not factually ascertainable until proven by a VA examination or medical opinion, we note that VA has authority to accept non-VA medical records or lay statements as a basis for setting an effective date.

In responding to these comments, we noted that the first sentence of paragraph (a)(2) could be clarified. In the NPRM, it read, “For the purposes of this part, `date entitlement arose' means the date shown by the evidence to be the date that the claimant first met the requirements for the benefit awarded.” We now propose to simplify this sentence to read, “For purposes of this part, `date entitlement arose' means the date that the claimant first met the requirements for the benefit as shown by the evidence.”

Another commenter suggested keeping the phrase “facts found” because he did not think the phrase was ambiguous or unclear. We have reconsidered the replacement of “facts found” with “date entitlement arose”, however, we decline to keep the phrase “facts found”. As discussed above, the phrase “date entitlement arose” is easier to interpret and apply as it is more instructive as to how VA will make an effective date determination. Furthermore, we do not intend this substitution of the phrases as a substantive change in determining effective dates for benefits.

One commenter suggested that VA should assume that entitlement to benefits arises as of the date of receipt of the claim rather than before the receipt of the claim. In the commenter's view, “this would prevent a conflict with 38 U.S.C. 5110(b)(2)”. We disagree with the commenter and do not see a conflict between the regulation and statute. Indeed, if VA assumed that entitlement to benefits arises as of the date of receipt of the claim, rather than beforehand, that would deprive veterans of potential entitlement to earlier effective dates under § 5110(b)(2). We therefore propose to make no changes based on this comment.

Changes to § 5.150 Not in Response to Comments

We omitted the provisions of current § 3.400(h)(3) from the AM01 NPRM without any explanation in the preamble. For the reasons discussed below, we propose to omit them from part 5.

Section 3.400(h)(3) states, “As to decisions which have become final (by appellate decision or failure to timely initiate and perfect an appeal) and reconsideration is undertaken solely on Department of Veterans Affairs initiative, [the effective date of an award based on such a reconsideration will be] the date of Central Office approval authorizing a favorable decision or the date of the favorable Board of Veterans[`] Appeals decision.” The current structure of § 3.400(h) first appeared in the CFR in 1969. See 38 CFR 3.400(h) (34 FR 8703, June 3, 1969). VA maintained the previous distinction between non-final and final decisions, and also created distinct provisions governing final decisions based on the method used to reconsider or reopen the case. VA Regulations, Compensation and Pension, Transmittal Sheet 437 at I, Start Printed Page 71085132-3R (May 21, 1969). Paragraphs (h)(1) and (2) cover the most common difference of opinion situations and distinguish between non-final and final decisions. See id. Paragraph (h)(3) was added to apply to those admittedly “rare instances in which there has been final adjudication and no application for consideration or reopening has been submitted.” Id.

For claims that the Board reconsiders and grants “on its own initiative”, there is no distinct effective date rule. VA Central Office reconsiders only non-final decisions under its “difference of opinion” authority (see § 5.163), not final decisions. Indeed, it has no statutory or regulatory authority to reconsider final decisions. We are therefore not restating the (h)(3) Central Office provision in part 5.

The initially proposed rule mistakenly omitted the provisions of § 3.400(o)(1) (second sentence). This rule states that “[a] retroactive increase or additional benefit will not be awarded after basic entitlement has been terminated, such as by severance of service connection.” We propose to correct this omission by adding a paragraph (b) and redesignating proposed paragraph (b) as paragraph (c).

As stated in the AM01 NPRM, proposed § 5.150(b), now § 5.150(c), is a table of the location of other effective-date provisions in part 5, which are exceptions to the general effective date rule of proposed paragraph (a). As stated in the proposed rulemaking, the table is for informational purposes. We propose to add the sentence, “This table does not confer any substantive rights”, to clarify that it is a reference tool, and not a substantive rule.

Also, as stated in the preamble to the initially proposed rule, the table showed both already published and as yet unpublished part 5 regulations, which were subject to change. In this NPRM, we have updated the table to reflect the updated part 5 citations. We have also moved the references to effective dates of reductions and discontinuances to a separate table in § 5.705(b). As a result, proposed § 5.150(b), now § 5.150(c), contains only effective date provisions for awards or increased benefits. Having separate tables for each type of effective date will enable readers to more easily locate the section they need.

§ 5.151 Date of Receipt

One commenter proposed adopting a mailbox rule instead of the current date-of-receipt rule for purposes of filing claims. The commenter pointed out that the Board of Veterans' Appeals (the Board) accepts the postmark date as evidence of a document having been timely filed, and suggested that VA should adopt a similar rule for claims. See 38 CFR 20.305 (concerning how the Board will calculate the time limit for filing). We decline to adopt the commenter's suggestion because VA is prohibited by statute from awarding an effective date for a claim earlier than the date of receipt of the application or claim, unless specifically authorized. According to 38 U.S.C. 5110(a), “[u]nless specifically provided otherwise in this chapter, the effective date of an award based on an original claim, a claim reopened after final adjudication, or a claim for increase, of compensation, dependency and indemnity compensation, or pension, shall be fixed in accordance with the facts found, but shall not be earlier than the date of receipt of application therefor.” Having a date-of-receipt rule provides for certainty and consistency in determining when a document relating to a claim is received.

Initially proposed paragraph (b) consisted of one 93-word sentence. We propose to break the paragraph into three sentences, which will make the paragraph easier to read and understand.

§ 5.152 Effective Dates Based on Change of Law or VA Issue

One commenter suggested that we reconsider our decision to restate § 3.114(a) without change. The commenter believed that § 3.114(a) was very difficult to understand and was neither claimant-focused nor user-friendly. In response to this comment, we propose to revise initially proposed § 5.152 to state the provisions in the active voice, replace unnecessarily technical language with more commonly understood language, and reorganize the provisions into a more logical order.

The commenter set forth a detailed fact pattern and then correctly explained how the rule applied to those facts. The commenter then suggested that “any documented handling of a veteran's claims folder following a liberalizing change in law [should] constitute a claim for the newly available benefit” (emphasis in original). The commenter's concern was with VA's regulation authorizing retroactive payment of benefits for a period of 1 year prior to the date of receipt of a claim or the date of a VA-initiated review, if the claimant requests a review or VA initiates a review more than 1 year after the effective date of the law or VA issue. The commenter believed that such payments should be retroactive to the date of the first documented handling of the claims file following the effective date of the law or VA issue.

We decline to make any such change because it would be administratively burdensome and an extremely inefficient method of claims processing. The term “claim” is defined in § 5.1 as “a formal or informal communication in writing requesting a determination of entitlement, or evidencing a belief in entitlement, to a benefit under this part.” In other words, a claimant must identify the benefit sought. It would be unreasonable to require that, for example, the date of receipt of a change-of-address request, which would result in a handling of the claims file unrelated to a claim for compensation, serve as the effective date for retroactive benefits in a compensation claim.

The commenter also suggested that we define the phrase “administrative determination of entitlement”. The commenter did not explain how he believes the phrase is confusing, but the ordinary dictionary meaning of those words is clear. We note that a court has previously held that the meaning of this phrase is clear and consistent with its authorizing statute. McCay v. Brown, 106 F.3d 1577, 1580 (Fed. Cir. 1997). We therefore propose to make no changes based on this comment.

In initially proposed § 5.152(b) we used the term “payment”. We have determined that this term is too narrow because it excludes benefits that have no payment, for example a service-connected disability that was rated noncompensable. We have, therefore, used the term “benefits” instead, which is defined in § 5.1 as “any payment, service, commodity, function, or status, entitlement to which is determined under this part.”

In § 5.152(d)(2), we propose to replace the phrase “the award will be reduced or discontinued effective the last day of the month in which the 60-day period expired” with “VA will pay a reduced rate or discontinue the benefit effective the first day of the month after the end of the notice period”. This change in terminology does not affect the payment made to a beneficiary based on a reduction or discontinuance. The purpose of this change is to remedy any confusion that Veterans Service Representatives or beneficiaries may have experienced in interpreting the former part 3 language, as well as to establish uniform language for describing how to calculate effective dates.Start Printed Page 71086

§ 5.153 Effective Date of Awards Based on Receipt of Evidence Prior to End of Appeal Period or Before a Final Board Decision

One commenter suggested that we define the term “appeal period”. The term “appeal period” does not need a definition. The ordinary dictionary meanings for the words are sufficient to define the term. The commenter also recommended that the term “appeal period” be defined as any time “after a timely [Notice of Disagreement] and timely Substantive Appeal have been received”. We decline to make such a change because the suggested definition is incorrect. A timely Notice of Disagreement (NOD) and Substantive Appeal are the triggers that initiate appellate review by the Board. The “appeal period”, however, begins with the date of mailing of notice to a claimant concerning a decision made by the agency of original jurisdiction. See 38 CFR 20.302 through 20.306. The “appeal period” ends 1 year after the notice date if no NOD is received. Id. We agree, however, that proposed § 5.153 needs a cross-reference to 38 CFR parts 19 and 20 in order to instruct the reader on how to appeal to the Board. This proposed change will eliminate the need to define “appeal period” in part 5, as suggested by the commenter.

We believe that the heading of this section may have caused confusion. Therefore, we propose to revise the heading of § 5.153 to make clear that the regulation refers to both the appeal period and the time period after an appeal has been filed but before a final decision has been rendered.

The commenter also suggested that all evidence received between the date of receipt of a claim and expiration of the appeal period must be considered as having been filed in connection with the claim which was pending at the beginning of the appeal period, and, in claims for increase, evidence received during the 1-year period before the date of receipt of the claim must also be considered. Proposed 5.4(b) states that “VA will base its decisions on a review of the entire record.” Therefore VA must consider the evidence described by the commenter.

One commenter believed that proposed § 5.153 would not prescribe the same effective date for an award based on evidence received during an appeal period as would have applied “had that evidence been submitted and been of record at the time of the decision under appeal”. Proposed § 5.153 prescribed the effective date used in proposed § 5.150 (the general effective date provision for awards or increased benefits) for calculating an effective date based on information or evidence received during the appeal period. The intent in referencing this general effective date provision is to use the same effective date for awarding a benefit as if the final decision being appealed had not been decided. We disagree with the commenter that proposed § 5.153 would lead to a different result than its part 3 predecessors, §§ 3.156(b) and 3.400(q)(1). However, based on the comment, we have reviewed the last sentence of initially proposed § 5.153 and propose to clarify it by replacing it with the language in the last sentence of current § 3.400(q)(1), which states, “The effective date will be as though the former decision had not been rendered.” This change would still lead to the same result as the proposed rule because § 5.150 is still the applicable general effective date provision. We therefore propose to replace the reference to § 5.150 in our regulation text with a cross reference.

This same commenter had several concerns about the preamble discussion of proposed § 5.153 which the commenter believed would cause “misapplication of the law”. The commenter expressed concern with our statement that “if the evidence is submitted within the appeal period or before an appellate decision is rendered, then the effective date of the award can be as early as the date VA received the `open' claim.” 72 FR 28778, May 22, 2007. The commenter noted that “an effective date can be earlier than the date VA first received the open claim.” The commenter is correct to the extent that the commenter's statement is consistent with 38 U.S.C. 5110, and we did not intend any conclusion to the contrary.

Similarly, the commenter questioned VA's explanation regarding the removal of the qualifier “new and material” from proposed § 5.153, which is based on current § 3.156(b). 72 FR 28778, May 22, 2007. Specifically, the commenter disagreed with our statement that “if VA were to treat all evidence submitted after the appeal period has begun as `new and material evidence,' then the effective date could not be earlier than the date VA received that evidence (which could be construed as a claim to reopen).” Id. We note that any ambiguity in this statement is addressed by our other statement in the preamble to the proposed rule that “[t]he current regulation [, § 3.156(b),] can be read to suggest that new and material evidence is needed while the claim is still `open.' However, in such cases there is no claim to `reopen' because the claim has not been `closed' (that is, the claimant could still prevail on that claim).” 72 FR 28778, May 22, 2007. We therefore propose to make no change based on this comment.

Finally, we propose to not include current §§ 3.400(p) and 3.500(u) in part 5. These paragraphs are merely cross-references to effective-date provisions (currently in 38 CFR 3.114) are not necessary in part 5.

§ 5.160 Binding Effect of VA Decisions

One commenter questioned our decision not to repeat the 38 CFR 3.104(b) phrase “made in accordance with existing instructions” in proposed § 5.160(b). The commenter was concerned that our removal of the language would allow VA employees to disregard their procedural manuals and other VA guidance documents. As explained in our preamble discussion of the proposed rule, our reason for not including the language in our rewrite was because the “references to internal procedural manuals and other VA-generated documents that lack the force and effect of law are not appropriate for inclusion in the regulations”. 72 FR 28770, May 22, 2007. The problem we addressed by removing the phrase “made in accordance with existing VA instructions” is that substantive rules in procedural manuals and other VA documents that were not promulgated in accordance with the Administrative Procedure Act (APA) are not enforceable against claimants or beneficiaries. Where VA issuances confer a right, privilege, or benefit, or impose a duty or obligation on VA beneficiaries or other members of the public, VA continues to be bound by notice and comment requirements under the APA. See Fugere v. Derwinski, 1 Vet. App. 103 (1990). Therefore, we propose not to make any changes based on this comment.

§ 5.161 Review of Benefit Claims Decisions

We received several comments regarding this proposed regulation. One commenter suggested that “whether a hearing is ordered or not, [§ 5.161] should be amended to require the Service Center Manager or Decision Review Officer who conducts post-decision review to be subject to the same duty-to-inform obligation as VA hearing officers are now required under 38 CFR [3.103(c)(2)]”. The commenter mistakenly cited to 38 CFR 3.301(c)(2), but the duties of VA employees who conduct hearings are set forth in § 3.103(c)(2).Start Printed Page 71087

We agree with the commenter that VA should assist a claimant or beneficiary in developing his or her claim whenever possible and that the duty-to-inform is not limited to situations where a claimant requests a hearing. In practice, VA reviewers already suggest additional sources of evidence during informal conferences. Therefore, we propose to add a sentence to § 5.161(c) stating that, “In an informal conference, the reviewer will explain fully the issues and suggest the submission of evidence the claimant may have overlooked that would tend to prove the claim.”

One commenter questioned the accuracy of the statement, “The review will be conducted by a Veterans Service Center Manager or Decision Review Officer, at VA's discretion.” The commenter believed this statement was incorrect and referred to a VA application which the commenter believed provided “a right of election in these matters”. We decline to make a change based on this comment. Proposed § 5.161 pertains to a review before the agency of original jurisdiction, which is usually conducted by a Decision Review Officer (DRO). However, where a DRO is unavailable, VA reserves the right to have a Veterans Service Center Manager (VSCM) conduct the review. Proposed § 5.161 is based on § 3.2600, which contains this language as well.

One commenter questioned whether paragraphs (a) and (e) contain contradictory provisions. According to the commenter, “If the reviewer may only review a decision that has not yet become final, . . . how [can] this same reviewer . . . [also] reverse or revise (even if disadvantageous to the claimant) prior decisions of an agency of original jurisdiction (including the decision being reviewed or any prior decision that has become final) . . . on the grounds of [clear and unmistakable error]” (internal quotations omitted). We disagree that paragraphs (a) and (e) are contradictory. While it is true that the scope of review under proposed § 5.161(a) is limited to the decision with which the claimant has expressed disagreement in the NOD, prior decisions are always subject to reversal or revision for clear and unmistakable error (CUE). As proposed § 5.162(d) explains, CUE is a very specific and rare kind of error reserved for situations where reasonable minds cannot differ about the nature of the error. Specifically, while a reviewer may not be looking for such CUE during the review, if the reviewer encounters one, paragraph (e), as well as § 5.162, allow for reversal or revision of the decision containing that error. We therefore propose to make no changes based on this comment.

In initially proposed § 5.161(b), we stated that VA will, “notify the claimant in writing of his or her right to review under this section.” Because we have defined “notice” in § 5.1 as “a written communication VA sends a claimant or beneficiary at his or her latest address of record, and to his or her designated representative and fiduciary, if any”, we propose to revise paragraph (b) to state that VA will “send notice to the claimant . . .”, to be consistent with our definition.

§ 5.162 Revision of Agency of Original Jurisdiction Decisions Based on Clear and Unmistakable Error

In reviewing comments received regarding initially proposed § 5.162, we determined that this section should be revised and reorganized to improve readability. We propose to add new paragraphs (a) “Scope”; (b) “Review for clear and unmistakable error (CUE)”; (c) “Binding decisions and final decisions”; and (d) “What constitutes CUE”; and redesignate initially proposed paragraph (b) as paragraph (e).

We also determined that § 5.162 mistakenly omitted the provision in 38 CFR 3.400(k), which states, “Error (§ 3.105). Date from which benefits would have been payable if the corrected decision had been made on the date of the reversed decision.” We have added this provision to § 5.162(f), restated for better clarity: “In such cases, benefits are payable effective on the date from which benefits would have been payable if the corrected decision had been made on the date of the reversed decision.”

We received several comments based on this proposed regulation. One commenter suggested that we define the terms “reversed” and “revised”. We decline to adopt this suggestion because we prefer to rely on the common dictionary meanings of these terms and do not wish to deviate from these commonly understood meanings.

The same commenter noted that the cross reference to 38 CFR 20.1403 in proposed paragraph (a) is inadequate for purposes of adjudicating compensation and pension claims. The commenter suggested that VA should create a new subpart in part 5 that “will expressly set out for claimants and their representatives what it takes to file, raise, and prevail in a [claim] of clear and unmistakable error”. We agree with the commenter that it will be helpful to include the relevant portions of § 20.1403 in part 5. Newly proposed paragraph (d) includes language from the first paragraph of § 20.1403 by explaining what CUE is. We decline, however, to make the proposed change in a new subpart because such a change is beyond the scope of this project. We are also removing the cross reference so readers will not infer that § 20.1403 applies to CUE claims at the AOJ.

One commenter urged that VA include in § 5.162, “[t]he filing and pleading requirements that are necessary in presenting successful CUE claims . . .”, but offered no rationale for the suggestion. The same commenter urged that VA include provisions stating the “relationship of clear and unmistakable error claims to other statutes, regulations and legal doctrines”, but offered no rationale for the suggestion.

VA has established procedures for filing claims (§§ 5.50 through 5.57). Claims for CUE require the same procedures. Proposed paragraph (d) clearly informs claimants what they must show in order to prove CUE. Regarding the suggestion about the relationship of CUE to other statutes, regulations and legal doctrines, this type of analysis is not germane to the regulation because it would not inform the public about VA's duties or claimants' rights or duties. We therefore propose to make no changes based on these two comments.

In the NPRM preamble discussion of § 5.162, we stated that the intent of the section is to convey that VA adjudicative agency decisions that are final will be presumed correct unless there is a showing of CUE. We also stated:

The requirement of a showing of CUE applies only to a “final decision,” as defined by proposed § 5.2 to mean “a decision on a claim for VA benefits with respect to which VA provided the claimant with written notice” and the claimant either did not file a timely Notice of Disagreement or Substantive Appeal or the Board has issued a final decision on the claim. See 71 FR 16464, 16473-74 (March 31, 2006). We also proposed to incorporate 38 U.S.C. 5109A(c) and (d), which state that a CUE claim may be instituted by VA or upon request of the claimant and that a CUE claim may be made at any time after a final decision is made.

One commenter interpreted proposed § 5.162 as meaning that only final decisions can be reviewed for CUE. The commenter noted that the term “final” is not contained in the CUE statute, 38 U.S.C. 5109A, which states, “A request for revision of a decision of the Secretary based on clear and unmistakable error may be made at any time after that decision is made.”

The commenter asked why, if a claimant has filed a notice of disagreement and has not elected review Start Printed Page 71088under proposed § 5.161, VA should be unable to correct the decision if it is found to be clearly and unmistakably erroneous. The commenter further asked why, if VA discovered a CUE after a “binding” decision but before it became final under § 3.160(d), the decision should not be subject to immediate correction.

The commenter asserted, “The law does not limit a claim of CUE to a final VA decision, but rather more accurately contemplates a `binding' decision as defined in proposed § 5.160(a),” which is based on 38 CFR 3.104(a). The commenter further asserted that “[t]his would also be consistent with proposed § 5.161(e) [based on § 3.2600(e)], which permits decision review officers to review a binding, but non-final, decision that has been timely appealed and revise that decision on the basis of CUE.” The commenter urged VA to change initially proposed § 5.162 to state that CUE can be the basis to correct a “binding” decision even if the decision has not yet become “final”. We agree with the commenter and propose to revise proposed § 5.162 as discussed below.

The courts have consistently stated that a “final [AOJ] decision” is a prerequisite for a CUE collateral attack. Hines v. Principi, 18 Vet. App. 227, 236 (2004). Courts have repeatedly found that because an AOJ decision was final it was susceptible to reversal or revision based on CUE. See Knowles v. Shinseki, 571 F.3d 1167, 1168 (Fed. Cir. 2009) (where RO decision was presumptively final because veteran acknowledged notice and did not timely appeal, veteran properly raised claim of CUE); Hines, 18 Vet. App. at 235-36 (Court assumes RO decision became final where veteran filed NOD but not substantive appeal, and “[s]uch a final decision is a prerequisite for a CUE collateral attack”).

Concomitantly, courts have repeatedly found claims of CUE in AOJ decisions improper when that decision was not final, and that CUE may not be used to correct non-final decisions. In Norris v. West, 12 Vet. App. 413, 422 (1999), the court held, “as a matter of law that a [total disability rating based on individual unemployability] claim was reasonably raised to the RO and was not adjudicated. Thus, there is no final RO decision on this claim that can be subject to a CUE attack.” See Best v. Brown, 10 Vet. App. 322, 325 (1997) (RO decision not final where RO failed to notify veteran, therefore veteran cannot raise CUE with respect to that rating decision).

The courts have not, however, ruled on whether, in order to be subject to correction based on CUE, a decision must be “final” as that term is used in § 3.160(d) (which is based on 38 U.S.C. 7105(c)). Section 3.160(d) states that a “finally adjudicated claim” is a decision on a claim, “the action having become final by the expiration of 1 year after the date of notice of an award or disallowance. . . .” We are unaware of any judicial precedent holding that, for purposes of CUE review, a decision becomes final only after the time to appeal has passed.

When VA amended 38 CFR 3.105(a) to add the term “final and binding”, it intended the term to have the same meaning in that section as it has in § 3.104(a). Specifically, VA meant that decisions that are binding on all VA field offices at the time VA issues written notification in accordance with 38 U.S.C. 5104 are subject to revision for CUE. It did not mean “final” under 38 CFR 3.160(d) (that the decision was not timely appealed or was affirmed by the Board.

A review of the regulatory history of § 3.105(a) shows that VA added the “determinations which are final and binding” language in a 1991 rulemaking. 56 FR 65845, Dec. 19, 1991. Prior to that rulemaking, 38 CFR 3.104(a) used the “final and binding” language, but § 3.105(a) used the language “determinations on which an action was predicated. . . .” In the preamble to the proposed rule, VA stated, “The proposed amendment is intended to clarify that decisions do not become final until there has been written notification of the decisions to the claimants. . . .” 55 FR 28234, July 10, 1990. Similarly, in the preamble to the final rule, VA stated that the purpose of the amendment was, “to establish by regulation the point at which a decision becomes final and binding on all VA field offices.” It went on to state, “That point is reached when VA issues written notification on any issues for which it is required that VA provide notice to the claimant. . . .” 56 FR 65845, Dec. 19, 1991.

In Smith v. Brown, 35 F.3d 1516 (Fed. Cir. 1994), the issue before the court was whether an AOJ could reverse or revise a Board decision for CUE. In that context, the court analyzed the term “final and binding” as used in both in §§ 3.104(a) and 3.105(a) and found that the terms were intended to mean the same thing. Id. at 1523-25.

Congress codified 38 CFR 3.105(a) as 38 U.S.C. 5109A when it enacted Public Law 105-111, sec. 1(a)(1), 111 Stat. 2271 (1997). Disabled American Veterans v. Gober, 234 F.3d 682, 686 (Fed. Cir. 2000). As the court noted in Donovan v. West, 158 F.3d 1377, 1383 (Fed. Cir. 1998), “Although more detailed than [§ 3.105(a)], the basic substantive provision in [section 5109A] is the same as that in the regulation.” As the commenter noted, Congress did not include any finality requirement in that statutory language.

It has been long-standing VA practice to correct CUE in decisions that are “final and binding” under 38 CFR 3.105(a), even though they have not “become final by the expiration of 1 year after the date of notice [of a decision], or by denial on appellate review, whichever is the earlier.” 38 CFR 3.160(d). We codified this practice in 38 CFR 3.2600(e), which states the “reviewer may reverse or revise (even if disadvantageous to the claimant) prior decisions of an agency of original jurisdiction (including the decision being reviewed or any prior decision that has become final due to failure to timely appeal) on the grounds of clear and unmistakable error (see § 3.105(a)).” The “decision being reviewed” under § 3.2600(e) is one that has not “become final due to failure to timely appeal”.

Finality under proposed § 5.1 is not a prerequisite for correction of a decision based on CUE, and we therefore propose to write new paragraph (b) to clearly state that final or non-final decisions may be corrected under the CUE doctrine. We propose to clarify this point in § 5.162(b) by stating that, “At any time after the AOJ makes a decision, the claimant may request, or VA may initiate, AOJ review of the decision to determine if there was CUE in the decision.”

Current § 3.105(a) states, “[W]here an award is reduced or discontinued because of administrative error or error in judgment, the provisions of § 3.500(b)(2) will apply.” While this provision tells the reader what effective date provision applies in such cases, it is unclear that the standard governing the decision is clear and unmistakable error. The intended meaning of this sentence is seen in the regulatory history. When VA implemented the effective date rule for 38 U.S.C. 5112(b)(10), it explained that, “Payments will be terminated under this subparagraph on the basis of clear and unmistakable error. (See VA Regulation 1105(A).)” VA Regulations, Compensation and Pension, Transmittal Sheet 271 at iv (Dec. 1, 1962). Although the quoted language referred only to “terminated” benefits, it cited VA Regulation 1105(A), which at that time included both reductions and discontinuances of VA benefits. VA Regulations, Compensation and Pension, Transmittal Sheet 267 at 37-2R (Dec. 1, 1962). In order to clarify this Start Printed Page 71089point in part 5, we propose to state explicitly in § 5.162(e) that when VA reduces or discontinues a benefit resulting from a VA administrative error or error in judgment, it applies the clear and unmistakable error standard.

In the AM01 NPRM, we initially proposed to add a new definitions section that would define “administrative error” and “error in judgment,” in § 5.165(c)(2). We have determined that, because proposed § 5.165 (now renumbered as § 5.166) is an effective date regulation and this provision is substantive, it is more logical to place it in new § 5.162(e).

Initially proposed § 5.165(c)(2) included a list of examples of administrative errors or errors in judgment. That list included, “(iii) Failure to follow or properly apply VA instructions, regulation, or statutes.” We have determined that the term “instructions” is unnecessary. Historically, VA used the term “instruction” to describe the Administrator's binding guidelines for implementing newly enacted laws. VA has not issued such “instructions of the Administrator” since the 1960s. Because VA has not issued such instructions since the 1960s, it is not useful to include references to them in a list of examples of common sources of administrative error or error in judgment.

Finally, in paragraph (f), “Effect of reversal or revision on benefits”, we propose to add a cross reference to § 5.167(c), the effective date rule for reduction or discontinuance of benefits based on VA administrative error or error in judgment. This will alert the reader that the effective date of such reductions or discontinuances differs from the general rule that the revision of a decision containing CUE is effective as if the original decision were correctly made.

§ 5.163 Revision of Decisions Based on Difference of Opinion

Initially proposed § 5.163 was one 89-word sentence. To improve readability we propose to divide it into three sentences. We also propose to specify that the revised decision must be more favorable to the claimant.

§ 5.164 Standard of Proof for Reducing or Discontinuing a Benefit Payment or for Severing Service Connection Based on a Beneficiary's Act of Commission or Omission

We have revised the proposed section heading of § 5.164 to apply to the several types of adverse actions VA can take upon determining a beneficiary obtained a benefit by an act of commission or omission. We have revised the headings of §§ 5.167 and 5.177 similarly.

In initially proposed § 5.162(b), we stated, “[F]or reductions or discontinuances based on CUE resulting from an act of commission or omission by the beneficiary or with the beneficiary's knowledge, VA will apply § 5.165(b).” In doing so, we mistakenly overlooked that the first sentence of 38 CFR 3.105 states, “The provisions of this section apply except where an award was based on an act of commission or omission by the payee, or with his or her knowledge. . . .” Since § 3.105 includes the provisions on CUE, CUE is not the proper standard for a reduction or discontinuance of a benefit, or for severance of service connection, obtained through an act of commission or omission.

We have revised the proposed regulation to include severance of service connection among the adverse actions VA will take upon finding an act of commission or omission by a preponderance of the evidence, rather than by clear and unmistakable evidence. This would be consistent with the holding in Roberts v. Shinseki, 23 Vet. App. 416 (2010), where the court concluded “that the provisions of § 3.105 [(d)] do not apply to cases involving severance of service connection based on fraud.” Id., at 428.

Neither the statutes nor the regulations provide a standard for reduction or discontinuance of a benefit obtained through an act of commission or omission. In such cases, VA applies its default standard of proof, which is preponderance of the evidence. When VA implemented 38 U.S.C. 5112(b)(9) in VA Regulation 1500(b)(1) (currently 38 CFR 3.500(b)(1)), it explained that in determining whether benefits were based on an act of commission or omission “[t]he benefit of any doubt will be resolved in favor of the payee.” VA Regulations, Compensation and Pension, Transmittal Sheet 271 at iii (Dec. 1, 1962). Thus, when the evidence is in equipoise, VA cannot reduce or discontinue benefits. But when the evidence against the beneficiary outweighs the evidence supporting the beneficiary, the benefit of the doubt doctrine does not apply (Gilbert v. Derwinski, 1 Vet. App. 49, 55-56 (1991)), and VA will reduce or discontinue.

Proposed § 5.3(b)(4) states that, “A fact or issue is established by a `preponderance of evidence' when the weight of the evidence in support of that fact or issue is greater than the weight of the evidence against it.” The preponderance standard is relatively easy for VA adjudicators to apply. It is also a high enough standard to protect beneficiaries from arbitrary or capricious reductions or discontinuances by VA. We also note that before reducing or discontinuing benefits under § 5.164, VA must provide due process to the beneficiary under § 5.83(a).

It will be helpful to inform the public that VA applies the preponderance standard in a reduction or discontinuance of a benefit obtained through an act of commission or omission. We therefore propose to add a new § 5.164, which states, “VA will reduce or discontinue a benefit, or sever service connection, if a preponderance of the evidence shows that it resulted in whole or in part, from an award based on an act of commission or omission by the beneficiary or an act of commission or omission done with the beneficiary's knowledge.”

Although section 5112(b)(9) does not specify, VA has long interpreted it to mean that it applies when an award was based in whole or in part on the act of commission or omission. VA General Counsel's opinion VAOPGCPREC 2-90, 55 FR 27756 (July 7, 1990). We propose to include the phrase “in whole or in part” in paragraph (a) to make this point.

As stated in § 5.162(b), in a CUE claim, VA's review will be based “only on the evidence of record and the law in effect when the AOJ made the decision.” However, no such restriction applies when VA reduces or discontinues a benefit, or severs service connection, for reasons other than CUE. To ensure that readers are aware of this, we propose to insert the following sentence into § 5.164(a), “The review will be based on the law in effect when the agency of original jurisdiction (AOJ) made the decision and on all evidence currently of record, regardless of whether it was of record at that time.”

In proposed § 5.164(b), we provide readers with examples of an act of commission or omission by the beneficiary or an act of commission or omission done with the beneficiary's knowledge. We selected all but the fourth of these examples because they are some of the most common situations in which VA reduces or discontinues benefits. We included the fourth example, service connection obtained by fraud, because severance of service connection greatly affects a veteran's benefits. Paragraph (b) is not an exclusive list of acts of commission or omission.Start Printed Page 71090

§ 5.167 Effective Dates for Reducing or Discontinuing a Benefit Payment, or for Severing Service Connection, Based on Omission or Commission, or Based on Administrative Error or Error in Judgment

In initially proposed § 5.165 (now renumbered § 5.167) we inadvertently omitted severance of service connection in the list of actions for which initially proposed § 5.165 provided effective dates. The regulation was incomplete without it, because VA will sever service connection if a claimant obtained it by an act of commission or omission, or if VA granted service connection because of its administrative error or error in judgment. We therefore propose to add this severance provision.

We propose to add a new § 5.164 and renumber initially proposed § 5.166 as § 5.165, and therefore we have renumbered initially proposed § 5.164 as § 5.166 and initially proposed § 5.165 as § 5.167. One commenter suggested that initially proposed § 5.165(c) effectively would permit VA to “take adverse action against claimants on much lower showings of VA error than the law governing CUE permits”. We disagree with this comment. This paragraph merely implements the statutory provision in 38 U.S.C. 5112(b)(10). It does not address the standard applicable to VA decisions to reduce or discontinue benefits.

The commenter apparently believed that CUE and VA administrative error are similar in that both can result in a decision to reduce or discontinue an award, with VA administrative error having to meet a lower standard than CUE. That is not correct. Proposed § 5.165 is an effective date provision which sets different dates for reduction or discontinuance of benefits depending on whether the beneficiary or VA made an error. When CUE or severance of service connection and is based on a beneficiary's act of commission or omission, VA corrects the award retroactively. When CUE results in a reduction or discontinuance of an award or severance of service connection and is based solely on VA error, VA corrects the award prospectively. VA is not lowering the standard for finding error that result in the reduction or discontinuance of benefits and these part 5 rules would not cause such an effect. We therefore propose to make no changes based on this comment.

Lastly, initially proposed § 5.165(c)(2) provided a list of administrative errors or errors in judgment. VA does not intend this list to be exclusive, so we propose to add the phrase “but are not limited to” to this provision, which is now included in § 5.162(e), in order to avoid that mistaken impression.

§ 5.170 Calculation of 5-year, 10-year, and 20-year Periods to Qualify for Protection.

In the preamble to initially proposed § 5.170, we failed to state that paragraph (a) is a new scope provision informing the reader of the rules gathered in § 5.170 (§§ 3.344, 3.951, and 3.957).

One commenter suggested that proposed § 5.170(a) was unclear because a rating has to be “in effect” for 10 years before service connection is protected, but a rating has to be “continuous” for 5 years for a disability to be considered stabilized and “continuous” for 20 years for the disability level to be protected. The commenter suggested that we use either “in effect” or “continuous”, or explain why we use different terms.

For the following reasons, we decline to make a change based on this comment. We use different terms because different rights are being protected. As noted in the preamble to the initially proposed rule, a precedent opinion, VA General Counsel's opinion VAOPGCPREC 5-95, 60 FR 19808 (Apr. 20, 1995), held that a disability could be considered “continuously rated” at or above a specified level for purposes of 38 U.S.C. 110 only if there was no interruption or discontinuance of the compensation being paid based on that rating for a period of 20 years or more. The statute provides this protection because veterans become dependent on a certain level of compensation when it has been paid without interruption for such a long period of time.

Similarly, when a disability has been continuously rated at the same level for 5 years or more, VA considers it to be stabilized. This provides some measure of protection in that the veteran is less likely to experience a reduction in compensation in the future or be subjected to repetitive examinations that yield the same result time after time. In both cases, when the term “continuous” is used, the protection provided concerns the level of compensation.

On the other hand, the term “in effect” is used only in connection with the 10-year protection afforded by 38 U.S.C. 1159 for service-connected status. There is no discussion of interrupted compensation payments breaking the continuity of a rating. Once service connection has been granted for a disability, that status is unaffected by variations in the level of compensation. If that status remains “in effect” for 10 years, service connection cannot be severed in the absence of fraud or military records showing the person did not have the requisite service or character of discharge. Since disability level and service-connected status are different concepts, it is appropriate to use different terms when discussing their protection criteria.

Initially proposed § 5.170(b) stated, “A protection period begins on the effective date of the rating decision and ends on the date that service connection would be severed or the rating would be reduced, after due process has been provided.” We believe the term “protection period” could be misinterpreted to mean that a rating is protected during this period. It is merely a qualifying period that triggers the protections in §§ 5.171, 5.172, and 5.175. We have revised this paragraph to clarify that point and reorganized the language to improve readability.

The same commenter suggested that the language in initially proposed § 5.170(c) was unclear because it did not explain whether the continuity of a rating resumes after a veteran is discharged from active military service. Currently, proposed § 5.170(c) provides that “a rating is not continuous if benefits based on that rating are discontinued or interrupted because the veteran reentered active service.” As noted above, in the preamble discussion for the proposed rule, we cited to VAOGCPREC 5-95, which held:

Where compensation is discontinued following reentry into active service in accordance with the statutory prohibition on payment of compensation for a period in which an individual receives active-service pay, the continuity of the rating is interrupted for purposes of the rating-protection provisions of 38 U.S.C. 110 and the disability cannot be considered to have been continuously rated during the period in which compensation is discontinued.

Moreover, VA generally does not have the ability to examine veterans once they have returned to active duty, nor does it have a reason to do so, so VA generally cannot determine whether their condition has improved during that time. Such veterans can still satisfy the protection criteria of 38 U.S.C. 110, but the qualifying period for protection must begin anew upon resumption of compensation. We therefore propose not to adopt the change suggested by the commenter.

Another commenter questioned whether receipt of active duty for training (ACDUTRA) pay breaks the continuity of payment for purposes of protection. The former part 3 cross reference (§ 3.654) that followed § 5.170(c), which has since been updated with its part 5 counterpart § 5.746, clarifies that “active military service pay means pay received for active duty, active duty for training or Start Printed Page 71091inactive duty training”. Therefore, receipt of ACDUTRA pay is considered to be receipt of active military service pay, which operates to break continuity of payment for purposes of breaking continuity of a rating. We therefore propose not to make any changes to § 5.170 based on this comment.

§ 5.171 Protection of 5-Year Stabilized Ratings

One commenter observed that the NPRM misquoted sentence 5 of § 3.344(a) as follows: “. . . sentence 5, which states, `lists those diseases that will not be reduced . . . ' ” (emphasis in comment) 72 FR 28782, May 22, 2007. The commenter is correct, the quoted language actually paraphrased sentence 5 of § 3.344(a). We rewrote sentence 5 of § 3.344(a) as proposed paragraph (d)(2), reorganized for clarity. The comment, though accurate, does not require any change from the proposed regulation.

This commenter asserted that § 3.344 is a very difficult regulation full of outdated, superfluous verbiage, much of which we could discard. The commenter however, gave one example, specifically the eighth sentence of § 3.344(a) (initially proposed as § 5.171(d)(6)), which the commenter asserted was meaningless. That sentence stated, “When syphilis of the central nervous system or alcoholic deterioration is diagnosed following a long prior history of psychosis, psychoneurosis, epilepsy, or the like, it is rarely possible to exclude persistence, in masked form, of the preceding innocently acquired manifestations.”

We disagree that this provision is meaningless, but we conclude it is not useful because it does not provide any instruction, impose any duty, or convey any right. The sentence essentially informs VA employees who perform disability ratings that syphilis and alcoholic deterioration diagnosed after a long prior history of “psychosis, psychoneurosis, epilepsy, or the like,” can mask the persistent prior disease, and therefore the focus of the rating decision should be the “preceding innocently acquired manifestations.” Initially proposed paragraph (d)(6) does not actually instruct VA to take any specific action. It does not impose any specific duty different than does paragraph (d)(2) for diseases subject to episodic improvement, and it does not convey any rights in addition to those stated in paragraph (d)(2). Consequently, we agree that it is confusing surplus and propose not to repeat the eighth sentence of § 3.344(a) in part 5.

One commenter asked us to clarify that improvement in a veteran's disability condition must be demonstrated before VA can reduce a stabilized disability rating. The commenter suggested that before VA can reduce a disability rating, not only must it be determined that an improvement to a disability has actually occurred, but also that the improvement reflects an improvement in the veteran's ability to function under ordinary conditions of life.

In response to this comment, we note that initially proposed § 5.171(c) stated, in pertinent part, that VA will not reduce a stabilized rating unless there is evidence of material improvement and VA may reduce a stabilized rating when an examination shows sustainable material improvement, physical or mental, in the disability, and the evidence shows that it is reasonably certain that the material improvement will be maintained under the ordinary conditions of life.

As a practical matter, it is doubtful that there would be a case in which the evidence shows that it is reasonably certain that the material improvement will be maintained under the ordinary conditions of life unless there had already been material improvement under the ordinary conditions of life. Therefore, we propose to add “under the ordinary conditions of life” to proposed paragraph (c)(1), to read, “An examination shows material improvement in the disability, under the ordinary conditions of life . . .”

In addition, we propose to remove the word “sustainable” because it refers to the veteran's future condition, which is covered by paragraph (c)(2). We propose to change the word “when” to “if” in the second sentence of paragraph (c) because “when” incorrectly implies that the veteran's condition will eventually improve. Lastly, we propose to remove the phrase, “physical or mental”. It is unnecessary because all disabilities are either physical or mental.

One commenter suggested that paragraph (d) is vague and ambiguous because it does not explain when medical examinations for purposes of determining material improvement would be administered. The commenter also thought that the paragraph failed to explain whether “VA will follow any standards or rules when it chooses certain veterans for a new examination, or if VA will use subjective criteria in its selection”.

Initially proposed § 5.171 does not include the standards VA applies when determining whether and when to reexamine a veteran because these standards are described in detail in proposed § 5.102, “Reexamination requirements”. Based on this comment, we propose to add a cross reference to § 5.102 at the end of § 5.171.

One commenter questioned whether proposed paragraph (d) would create tension with the standard governing reduction of total disability ratings under § 3.343. Section 3.343 pertains to the rule governing continuance of total disability ratings and outlines a list of mandatory considerations that VA must take into account before reducing such total disability ratings. The commenter expressed concern over whether adoption of § 5.171(d) would in effect “allow adjudicators to bypass the established protections of § 3.343 in favor of reducing a total evaluation by . . . more lenient conditions”. Proposed § 5.171(d) would not have such an effect. It is a rewrite of § 3.344(a), which simply provides guidance on factors that VA will consider before reducing disability ratings that have either become stable or otherwise were made on account of diseases that are subject to temporary or episodic improvement. The part 5 counterpart to § 3.343 is § 5.286, which will govern the continuance of total disability ratings. We therefore propose to make no changes based on this comment.

One commenter suggested that the organization of paragraph (d)(1) could be improved by separating the topic of “how VA will determine whether there has been material improvement” from “what types of evidence a complete medical record consists of”. The commenter recommended reorganizing the last sentence of paragraph (d)(1) and its paragraphs into a new paragraph (d)(5) after our discussion concerning what constitutes material improvement. We agree with this suggestion and propose to add a new paragraph (d)(5) consisting of the last sentence of paragraph (d)(1) and its paragraphs. We propose to redesignate initially proposed paragraph (d)(5) as (d)(6).

One commenter suggested that we replace the term “medical record” with “evidentiary record” in regard to initially proposed paragraph (d)(4), which pertains to when VA will determine material improvement exists for purposes of decreasing disability ratings. The commenter was concerned that the term “medical record” may unduly restrict VA's current practice of considering all evidence in the record, including lay evidence. We agree with the commenter and propose to adopt the suggested change.

In reviewing initially proposed § 5.171(e) based on this comment, we noted that in the preamble of the proposed rulemaking, 72 FR 28770, May Start Printed Page 7109222, 2007, we failed to explain that we had omitted from paragraph (e) the following, contained in current § 3.344(b): “the rating agency will determine on the basis of the facts in each individual case whether 18, 24, or 30 months will be allowed to elapse before the reexamination will be made.” We omitted this language because VA schedules reexaminations for various future dates (based on the factors described in § 5.102) and these dates are not limited to 18, 24, or 30 months in the future.

We also determined that the scope of paragraph (e) (which is based on current § 3.344(b)) needed clarification. We therefore propose to revise paragraph (e) to clarify that it only applies to cases involving a change in diagnosis.

§ 5.173 Protection Against Reduction of Disability Rating When VA Revises the Schedule for Rating Disabilities

Initially proposed § 5.173(b) described how VA modifies a rating that was assigned under the 1925 Schedule for Rating Disabilities. There are no longer any veterans being compensated under the 1925 Schedule. We therefore propose to remove the last phrase in paragraph (a) and all of paragraph (b) because these concerned revisions to ratings under the 1925 Schedule.

§ 5.175 Severance of Service Connection

Initially proposed § 5.175(a)(1) and (2) provided that the protection from severance of 10 year old service connection applies to grants of disability compensation and to dependency and indemnity compensation (DIC), respectively. As initially proposed, § 5.175 did not address whether this protection applies to benefits under 38 U.S.C. 1151.

In August 2010, the U.S. Court of Appeals for Veterans Claims in Hornick v. Shinseki, 24 Vet. App. 50, 56 (2010), held that the preclusion in 38 U.S.C. 1159 against severing service connection in effect for 10 years or more pertains to disability compensation payments awarded under 38 U.S.C. 1151 (Benefits for persons disabled by treatment or vocational rehabilitation). We propose to add the following at the end of initially proposed paragraph (a)(2): “and to disability compensation or DIC granted under 38 U.S.C. 1151” to afford this protection to these benefits. Adding “disability compensation . . . under 38 U.S.C. 1151” implements the holding in Hornick. We are also adding “or DIC granted under 38 U.S.C. 1151”, to be consistent with sections 1151 and 1159, which both apply to DIC. This addition is also consistent with Hornick.

One commenter suggested that we separate this section into two regulations, one to address the protection of service connection and the other to address the severance of service connection. We decline to make this change because the paragraphs are appropriately titled regarding when protection of service connection applies versus when severance of service connection applies. Further, when taken as a whole, the entire section addresses the single issue of whether and when VA may sever service connection.

The commenter further asserted that VA should not adopt the proposed regulation § 5.175(b)(2) because “the law of clear and unmistakable error bars a veteran from submitting, and the VA from considering, any new medical opinion evidence (or any new evidence for that matter), in order to establish the existence of CUE”. The commenter also stated that because the law that governs CUE “does not permit the veteran to successfully argue that a change in diagnosis can be accepted as a basis for the award of service connection `based on clear and unmistakable error . . .', VA cannot be permitted to sever an award of service connection based on the same sort of medical evidence.” The commenter asserted that this proposed provision “reflects inconsistent and arbitrary agency action”. The commenter asserted that the courts have clearly held that “when an allegation is made that a VA decision contains CUE, that VA's decision on the allegation is strictly limited to the evidence that was before the VA adjudicator at the time VA made the decision being challenged as containing CUE.” The commenter cited Russell v. Principi, 3 Vet. App. 310 (1992), for the proposition that new medical evidence that corrects an earlier diagnosis that was a basis for an earlier decision by the agency of original jurisdiction cannot be considered in a CUE case.

The commenter also noted that the Board of Veterans' Appeals (Board) regulation contained in 38 CFR 20.1403(d) states, “(d) Examples of situations that are not clear and unmistakable error—(1) Changed diagnosis. A new medical diagnosis that `corrects' an earlier diagnosis considered in a Board decision.”

For the following reasons, we propose to make no change based on this comment. The commenter fails to recognize the distinction between § 3.105(a) and § 3.105(d). As used in § 3.105(d) and proposed § 5.175(b), the phrase “clearly and unmistakably erroneous” is intended to describe the high standard of proof that must be met before VA can sever service connection. The phrase “clearly and unmistakably erroneous” is not intended to incorporate the procedural rule applicable to claims under § 3.105(a) that collateral review of a prior final decision must be based solely on the evidence that was before VA at the time of that decision. The provisions of § 3.105(a) and § 3.105(d) involve different procedural standards because § 3.105(a) concerns collateral review and retroactive correction of a final decision. In contrast, § 3.105(d) involves only review of the veteran's entitlement to benefits prospectively. VA recognizes that the use of the same high standard, clear and unmistakable error, might be confusing to some laypersons. For that reason, VA has consistently made clear in its regulations that severance determinations under § 3.105(d) may be based on consideration of evidence obtained subsequent to a prior determination.

Furthermore, we note that the provision in proposed § 5.175(b)(2) is not new; it is based on a substantially similar provision in current 38 CFR 3.105(d). The courts have held that, as a general principle, when an allegation is made that a VA decision contains CUE, VA's decision on the allegation is strictly limited to the evidence that was before the VA at the time VA made the decision being challenged as containing CUE. The U.S. Court of Appeals for Veterans Claims set forth this principle in the Russell case (id. at 314).

However, Russell involved a CUE claim under 38 CFR 3.105(a), not severance of service connection under § 3.105(d). Section 3.105(d) states, in pertinent part that “[s]ubject to the limitations contained in §§ 3.114 and 3.957, service connection will be severed only where evidence establishes that it is clearly and unmistakably erroneous (the burden of proof being upon the Government). . . . A change in diagnosis may be accepted as a basis for severance action if the examining physician or physicians or other proper medical authority certifies that, in the light of all accumulated evidence, the diagnosis on which service connection was predicated is clearly erroneous. This certification must be accompanied by a summary of the facts, findings, and reasons supporting the conclusion. . . .”

Thus, § 3.105(d) does not state that decisions will be reversed because they were based on CUE. These are dealt with in § 3.105(a). Rather, § 3.105(d) states that a veteran's service-connected status will be severed if it is clearly and unmistakably erroneous. Since it is a review of the veteran's current status, Start Printed Page 71093VA naturally must consider current evidence.

The courts have consistently upheld the long-standing provision in 38 CFR 3.105(d) that evidence concerning a change in diagnosis (which was not of record when service connection was granted) may be considered in determining whether service connection is clearly and unmistakably erroneous. See Stallworth v. Nicholson, 20 Vet. App. 482, 488 (2006); Daniels v. Gober, 10 Vet. App. 474, 480 (1997); Venturella v. Gober, 10 Vet. App. 340, 343 (1997). As the court has noted, if VA were not permitted to consider post-decisional evidence in a severance case, VA “would be placed in the impossible situation of being forever bound to a prior determination regardless of changes in the law or later developments in the factual record.” Venturella, 10 Vet. App. at 343.

The commenter's reliance on 38 CFR 20.1403(d) is inapposite to the question of the validity of § 3.105(d). Section 20.1403 implements 38 U.S.C. 7111 which relates to the review of Board decisions based on clear and unmistakable error. In the proposed rulemaking for § 20.1403, 63 FR 27535, May 19, 1998, VA noted that, “the term `clear and unmistakable error' originated in veterans regulations some 70 years ago, see generally Smith (William) v. Brown, 35 F.3d 1516, 1524-25 (Fed. Cir. 1994), and is now incorporated in VA regulations governing VA RO determinations. 38 CFR 3.105(a).” VA also noted (at 63 FR 27536, May 19, 1998) that the legislative history for section 7111 “indicates that the Congress expected the Department would implement section 1(b) of the bill in accordance with current definitions of CUE. H.R. Rep. No. 52, 105th Cong., 1st Sess. 3 (1997) (report of House Committee on Veterans' Affairs on H.R. 1090) (“Given the Court's clear guidance on this issue [of CUE], it would seem that the Board could adopt procedural rules consistent with this guidance to make consideration of appeals raising clear and unmistakable error less burdensome”); 143 Cong. Rec. 1567, 1568 (daily ed. Apr. 16, 1997) (remarks of Rep. Evans, sponsor of H.R. 1090, in connection with House passage) (“The bill does not alter the standard for evaluation of claims of clear and unmistakable error.”)”

Thus, § 20.1403 was intended to codify a statute whose basis was § 3.105(a), not § 3.105(d). As such, there is no reason why § 3.105(d) or § 5.175 must contain the same procedures as those in § 20.1403.

For the reasons stated above, we propose to make no changes based on this comment.

We propose, however, to revise the heading of initially proposed paragraph (b) to read, “Standard of proof to sever service connection—general rule”, and to add paragraph (c), “Standard of proof to sever service connection—fraud”. The new paragraph (c) comprises a cross reference to proposed § 5.164. It serves, without repeating proposed § 5.164, to inform the reader that VA's burden of proof to sever service connection obtained by fraud is the same as to sever service connection obtained by any other act of commission or omission. Fraud is distinguishable from other acts of commission or omission in that a claimant's fraud will breach the protection established after service connection has been in effect for 10 years, whereas other acts of commission or omission will not.

These changes would correct a misstatement in the proposed rule that the dissenting opinion in Roberts v. Shinseki, 23 Vet. App. 416, 435-39 (2010) (Hagel, J., dissenting) called to our attention. In that case, the dissent first noted that, in rewriting §§ 3.957 (protection of service connection in place 10 years or longer) and 3.105(d), “VA intends to `clarify' and recodify 38 CFR 3.957 and the provisions of 38 CFR 3.105(d) that govern when service connection may be severed at 38 CFR 5.175, entitled `Protection or severance of service connection.'” Id. at 436. The dissent also noted that our proposed regulations did not except severance of service connection based on fraud from the due process or burden of proof elements of §§ 3.957 or 3.105(d). Id. at 436, 440. Finally, the dissent noted that the NPRM stated that it explained any substantive changes between part 3 and part 5, 72 FR 28771-72, May 22, 2007, and that there was nothing in the NPRM “indicating that the rewriting and restructuring of the regulations [pertaining to severance of service connection for fraud] are intended as substantive changes.” Id. at 437-39. From these observations, the dissent reasoned, the NPRM revealed VA's interpretation of §§ 3.957 and 3.105(d) as requiring application of both the process and burden of proof provisions of § 3.105(d) before severing service connection.

Any disparity between the NPRM and the Secretary's position in the Roberts litigation results from our misstatements in the NPRM. In discussing initially proposed § 5.175 in the NPRM, we described that paragraph (a) would provide that service connection in effect for 10 years or more “may not be severed unless . . . (1) The original grant was obtained through fraud.” We further explained that proposed paragraph (b) “provided that severance of service connection may also occur when evidence establishes that it is clearly and unmistakably erroneous. . . .” 72 FR 28783, May 22, 2007. By stating “also”, we intended to state that § 5.175(a) and (b) would be alternatives for severing service connection. We did not mean that they would be a sequence of events: first, piercing the 10-year protection by showing fraud, and second, finding clear and unmistakable error in the grant of service connection obtained by fraud. We propose to correct the error in initially proposed § 5.175 by explicitly distinguishing the procedures and the burden of proof that apply to sever service connection that a claimant obtained by fraud.

§ 5.176 Due Process Procedures for Reducing or Discontinuing Disability Compensation Payments or for Severing Service Connection

One commenter suggested that we revise the introductory paragraph to enlarge the scope of § 5.176 to include situations where VA reduces or discontinues a disability rating but compensation benefits are not affected. Currently, proposed § 5.176 and its part 3 predecessor, § 3.105(e), require that VA provide notice of a contemplated adverse action followed by a 60-day period for the presentation of additional evidence only in situations where a lower rating would result in a reduction or discontinuance of compensation payments currently being made. However, where compensation benefits are not affected, where there is no adverse action, VA will provide only contemporaneous notice. See § 5.83(a).

We decline to make the suggested change to enlarge the scope of initially proposed § 5.176 because in cases where VA decreases the rating of any disability or disabilities but does not reduce the veteran's overall disability rating, there is no reduction of monetary benefits. In such cases, VA has no statutory duty to send advanced notice of its decision. Stelzel v. Mansfield, 508 F.3d 1345 (Fed. Cir. 2007). Further, due process concerns are not implicated because the veteran suffers no loss of benefits. Moreover, we note that along with the contemporaneous notice, VA also provides the veteran with information on procedural and appellate rights regarding the decision.

Another commenter believed that the initially proposed rule would eliminate the due process procedure of having an impartial VA employee participate in Start Printed Page 71094the review process for reducing ratings. The commenter noted that such procedures are already followed in the context of predetermination hearings, see § 3.105(i), and since the reduction of ratings also have an adversarial character, the practice “should be carried over to the new regulations”. While we agree that proceedings involving proposed adverse actions should be conducted by VA personnel who were not directly involved in proposing the adverse action, we decline to make changes based on this comment. The reason is that this due process procedure is already recognized in proposed § 5.82(d) which states that if the hearing arises in the context of a proposed reduction, discontinuance, other adverse action or an appeal, a VA employee or employees having decision-making authority and who did not previously participate in the case will conduct the hearing.

Proposed § 5.82(d) applies to a claimant's or beneficiary's right to a hearing upon being notified of a proposed reduction, discontinuance, or other adverse action under proposed § 5.83. Therefore, it is unnecessary to repeat the language of proposed § 5.82(d) in proposed § 5.176 because § 5.82(d) outlines an overarching VA policy that applies in all situations where a hearing is based on a proposed reduction, discontinuance, other adverse action, or on an appeal.

In addition, the commenter also urged that VA include in proposed § 5.176 the overarching duty to assist claimants in their claims by “suggest[ing] the submission of evidence which the claimant may have overlooked and which would be of advantage to the claimant's position”. The commenter urged that proposed § 5.176 be amended to require that VA inform beneficiaries of what type of evidence they should file to show “that service connection or a rating should be maintained.” The commenter provided an example, urging that VA inform a beneficiary if a notice of disagreement as to the reduction satisfies the requirement and would toll the 60-day period so that the veteran has more time to file additional evidence if needed.

As a preliminary matter, we note that it would be impossible for a beneficiary to file a valid notice of disagreement until VA had issued a decision, not merely a notice of a proposed decision. Initially proposed § 5.176(c) stated that in proposing a reduction or discontinuance, VA will notify the beneficiary that they may file, “evidence to show that service connection should be maintained, the rating should not be reduced, or the benefits should remain intact.” If such notices were to attempt to specify the exact type of evidence that is relevant, they might inadvertently omit relevant evidence that the beneficiary might file. Rather, it is more helpful to clearly explain “the contemplated action and furnish detailed reasons for the proposed reduction or discontinuance” (as stated in initially proposed § 5.176(b)) and allow the beneficiary to determine what evidence they can obtain or identify for VA to obtain.

The commenter also suggested that the 60-day time period for a beneficiary to present evidence when disputing a proposed severance of service connection or reduction in ratings is too short. The commenter claimed that “if VA expects veterans to file medical or scientific evidence to support their claims, the 60-day period will be too short and veterans will be effectively deprived of their procedural due process”. We decline to change the time period within which beneficiaries must present evidence to challenge a proposed adverse action. Beneficiaries generally are able to meet the 60-day deadline. Furthermore, VA already has procedures and regulations in place to extend the 60-day period if good cause is shown. See § 5.99, “Extensions of certain time limits”, based on § 3.109(b).

Finally, the commenter remarked that “many veterans subject to reduction or elimination of benefits have previously been found to be profoundly disabled.” The commenter expressed concern that “VA should recognize that in reduction actions it is dealing with some of the more helpless segments of the entire veteran population and should tailor its procedures accordingly.” VA beneficiaries subject to reduction of benefits have varying degrees of disability and our procedures are intended to provide fair treatment to all disabled veterans. To the extent that a beneficiary subject to a proposed reduction may have difficulty responding due to a profound disability, the veteran may request a good cause extension under § 5.99. We therefore propose to make no changes based on this comment.

In reviewing initially proposed § 5.176 to respond to comments, we noted that it is largely redundant of initially proposed § 5.83(a), Right to notice of decisions and proposed adverse actions. We therefore propose to delete § 5.176 and leave that number as reserved. We propose to include the following sentence from initially proposed § 5.176 in § 5.83: “If VA receives no additional evidence within the 60 days, or the evidence received does not demonstrate that the action should not be taken, VA will provide notice to the beneficiary that VA is taking the action.” We propose to omit the phrase “Prepare a rating proposing the adverse action and” because this is a administrative action that provides no due process to the beneficiary which is not already provided by the notice of the proposed adverse action.

§ 5.177 Effective Dates for Reducing or Discontinuing a Benefit Payment or for Severing Service Connection

We redesignated initially proposed § 5.177(c) as § 5.177(i) to move the paragraph explaining the exceptions of the regulation to the end of the section. We accordingly redesignated initially proposed § 5.177(d) through (i) as § 5.177(c) through (h), respectively.

In relation to the comment on initially proposed § 5.176 regarding enlarging the scope of situations where VA will provide advance notice of adverse actions, the commenter also suggested revising initially proposed § 5.177(f) for the same reasons. We decline to make this change because, as explained in our discussion on proposed § 5.176, where a decision does not result in adverse action, VA will follow the notification procedure in proposed § 5.83(b). Because the decision will not adversely affect compensation payments or other benefits, the notification procedure outlined in § 5.83(b) is adequate to preserve the veteran's procedural and appellate rights if the veteran disagrees with the decision.

One commenter questioned whether initially proposed § 5.177(f) would effectively reduce a veteran's compensation benefits by default “whether or not a final decision authorizing that reduction has been issued”. The commenter mistakenly believed that VA would reduce benefits before issuing a final decision on the matter. We decline to make any change based on this comment because § 5.177 clearly provides for two 60-day periods before a reduction or discontinuance takes effect: the first following a notice of a proposed adverse action (see § 5.83(a), the second following the notice of the final decision.

In initially proposed paragraphs (d), (e), and (f), we stated that VA will sever service connection or reduce or discontinue benefits “effective the first day of the month after a second 60-day period beginning on the day of notice to the beneficiary of the final decision.” We propose to revise the language in each of those paragraphs to clarify that after applying the 60-day notice period, VA will apply a second 60-day period which begins on the day VA sends notice to the beneficiary of the final Start Printed Page 71095decision. VA will then take the appropriate action to modify benefits, effective the first day of the month after the second 60-day period.

As with initially proposed § 5.175, discussed above, the dissent in Roberts, 23 Vet. App. at 435-39, revealed that initially proposed § 5.177 did not clearly accomplish our intent, or, at least, it was ambiguous when read together with the regulation on effective dates for correcting erroneous awards (initially proposed § 5.165, redesignated § 5.167). We therefore propose to revise the first sentence of initially proposed paragraph (d), redesignated as paragraph (c), to read: “Unless severance is based on the beneficiary's act of commission or omission that resulted in VA's grant of benefits, this paragraph applies when VA severs service connection.” We also propose to add a cross reference to § 5.167 stating, “See § 5.167 for effective date of severance of service connection obtained by fraud.”

The Roberts dissent noted that “VA reports that proposed § 5.165 `applies only to reductions or discontinuances of erroneous awards.' 72 Fed. Reg. 22,779.” Id. at 438, fn 13. The next sentence in the NPRM stated, however, “If a payment has not been authorized by a rating decision, then VA has not made an award of such an erroneous payment and therefore recovery of that payment is not a reduction or discontinuance of an `erroneous award' under 38 U.S.C. 5112(b)(9) or (10).” In other words, initially proposed § 5.165 distinguished “reductions or discontinuances” of “erroneous awards” from “reductions or discontinuances” of other types of payments that are not “awards,” and did not distinguish “reductions or discontinuances” from severance for fraud as an act of commission or omission. The proposed revision to redesignated § 5.177(c) and the additional cross reference to § 5.167 should make perfectly clear that the effective date of severance of service connection obtained by fraud is governed by proposed § 5.167 and is not 60 days after VA provides notice of the final decision severing service connection.

As initially proposed, § 5.177(g) stated that VA would reduce or discontinue pension payments because of a change in disability or employability status effective the first day of the month after a second 60-day period beginning on the day of notice to the beneficiary of the final decision. This statement conflicts with 38 U.S.C. 5112(b)(5), and current 38 CFR 3.105(f). The beneficiary is not afforded a second 60-day period before his or her benefits are to be reduced. We, therefore, propose to correct paragraph (g) in redesignated paragraph (f) to state that the effective date for the reduction or discontinuance of pension because of a change in disability or employability status is the first day of the month after notice to the beneficiary of the final decision.

We propose to move the effective date provision in initially proposed paragraph (h) from § 5.177 to § 5.591(b)(5), to consolidate all the effective date rules on Chapter 18 monetary allowance into one section.

IX. Subpart D: Dependents and Survivors AL94

In a document published in the Federal Register on September 20, 2006, we proposed to revise VA's regulations governing dependents and survivors of veterans, to be published in a new 38 CFR part 5. 71 FR 55052. We provided a 60-day comment period that ended November 20, 2006. We received submissions from three commenters: Disabled American Veterans, and two members of the general public.

§ 5.181 Evidence Needed To Establish a Dependent

In the NPRM, we proposed §§ 5.181 and 5.182 as separate sections. Because we have combined the contents of initially proposed §§ 5.181 and 5.182, as explained in § 5.182 below, we propose to renumber initially proposed § 5.180 as § 5.181. We propose to mark § 5.180 as reserved.

We also propose to reorganize and simplify the contents of initially proposed § 5.180 into § 5.181.

Proposed paragraph (a) simplifies the initially proposed “purpose” paragraph to clearly state that this regulation is limited to rules governing adding dependents, and with the exception of paragraph (d), does not govern changes to existing dependents. Also, in proposed paragraph (b)(1), we have eliminated the applicability of this rule to a case involving death, because death does not establish a dependent. Similar conforming changes were made to § 5.182, which governs only changes to the status of existing dependents. We proposed these changes for clarification purposes; we do not intend to change the persons to whom these rules would have applied as initially proposed.

We also propose to change paragraph (b)(1) by inserting “, day,” after “month” and “(city and state, or country if outside of a state)” after “place”. This information is necessary for VA to properly document marriages, termination of marriages, and births.

In initially proposed paragraph (c), we stated “VA will require additional supporting evidence to establish a veteran's marital status or a parent/natural child relationship . . . if any of the following factors are true: . . . (3) VA questions the validity of all or part of the statement;”. In comparing paragraph (c) with other sections in subpart D, we determined that the term “validity” means having legal effect or force. Our intent in paragraph (c)(3) was simply to include a question of the accuracy of a statement as one of the reasons for requiring additional evidence. We have, therefore, replaced the term “validity” with “accuracy”.

In paragraph (c)(5), we propose to change the rule that a statement is not sufficient to establish dependency when there is an indication of fraud or misrepresentation. Thus, we intend to change “in the other evidence in the record” to “in other evidence in the record”, removing the word “the” that appeared before “other evidence”. This change eliminates any suggestion that the reasonable indication of fraud or misrepresentation must appear in the totality of the evidence. VA will require additional evidence if any individual piece of evidence indicates fraud or misrepresentation, or if the evidence in its entirety gives such indication. This revision would make proposed paragraph (c)(5) better conform to proposed paragraph (c)(4), which would provide that a statement is not sufficient to establish dependency if the “statement conflicts with other evidence in the record . . .”

For reasons explained in the preamble to initially proposed § 5.181(c), 71 FR 55052, 55055, we are omitting certain provisions of § 3.213(b) from part 5, subpart D. Because we now propose to consolidate initially proposed § 5.181(c) and other initially proposed provisions in currently proposed § 5.184(d), we would repeat only the first sentence of § 3.213(b) in § 5.184(d). The restoration of benefit provisions of § 3.103(b)(4), restated in § 5.84, is more comprehensive than the restoration provision of § 3.213(b). Consequently, all but the first sentence of § 3.213(b) is superfluous, and § 5.184(d) would restate only that first sentence.

Initially proposed § 5.180(d) stated:

The types of additional supporting evidence required by paragraph (c) of this section are set forth in §§ 5.192 through 5.194, 5.221, 5.229 and 3.211 of this chapter. Where evidence is set forth in a particular section in the order of preference, VA may accept evidence from a lower class of preference if it is sufficient to prove the fact at issue.

This language was confusing. The rule was intended to explain that certain types of evidence are needed to Start Printed Page 71096establish specific facts. For example, in proposed § 5.192(c), a copy of a public record of marriage is generally more reliable and consequently preferred over an affidavit from the official who performed the marriage ceremony, and therefore, VA will not accept the latter unless the former is unobtainable. These rules of preference are more thoroughly explained in the individual paragraphs that set forth the hierarchy of preferred evidence, so we struck the language from initially proposed § 5.180(d). The only text that remained were the cross-references to the actual rules that describe the additional evidence that may be provided to establish specific facts. Therefore, we propose to move those cross-references into § 5.181(c) and renumber initially proposed § 5.180(e) as § 5.181(d). We further propose to add language to the specific regulations cited in proposed § 5.181(c), which include §§ 5.192(c), 5.221, 5.229, and 5.500. In addition, we have determined that the list of cross references was incorrect. We propose to correct the list in § 5.181(c).

Several initially proposed rules in RIN 2900-AL94 inadvertently added a requirement that a claimant's or beneficiary's statement filed as proof of marriage, termination of marriage, or birth of a child must be “written”. No such requirement exists in current §§ 3.204(a)(1) or 3.213(a) and (c). We have therefore not included this requirement in §§ 5.151(c), 5.181(b), 5.182(a), 5.183(a) or (b), 5.192(c), 5.193, 5.221(b), or 5.229.

§ 5.182 Changes in Status of Dependents

We propose to combine the contents of initially proposed §§ 5.181 and 5.182 into § 5.182, and reorganize and simplify the rules. In the revised rule, we refer in proposed § 5.182(a) to a beneficiary's duty to report a “[c]hange in status of a living child affecting who no longer meets the definition of a dependent”. This language replaces language in the initially proposed § 5.182(a)(2) that had specifically discussed discontinuance of school attendance. The broader language in the proposed rule more accurately describes a beneficiary's duty to report any change in a child's status that makes the child no longer a dependent of the beneficiary.

In initially proposed paragraph (a), we stated that a beneficiary must provide VA a statement containing the details of any change in dependency that could lead to a reduction or discontinuance of VA benefits. We required that the beneficiary report the month and year of the change. VA now requires the day, as well as the month and year of the change. We also require the city and state, or country if outside of a state, where the change occurred. See VA Form 21-686c, Declaration of Status of Dependents. We propose to amend paragraph (a) to conform to VA's current practice.

We propose to remove the cross reference to § 3.217, “Submission of statements or information affecting entitlement to benefits”, which was contained in initially proposed § 5.181(b) because § 5.182 contains all the relevant information needed to understand changes in dependency and so the cross reference is unnecessary.

We propose to move what was initially proposed paragraph § 5.181(c) to proposed § 5.184(d) because it is an effective-date rule specific to § 5.184.

§ 5.183 Effective Date of Award of Benefits for a Dependent

Initially proposed § 5.183 stated that the effective date for adding a dependent is the date VA receives notice of the existence of the dependent. We propose to change “notice” to “information”. In proposed § 5.1, we define notice as a written document that VA sends to the claimant or beneficiary. To state that VA receives notice of the dependent would be contrary to our proposed definition of the term. We mean to say that a dependent will be added upon receipt of information of the existence of such dependent. We also propose to state that the “information” must be filed by the claimant or beneficiary. As stated in proposed § 5.181, this regulation is limited to adding dependents, therefore, a claimant or beneficiary may establish a dependent to a new or existing award. This clarification does not constitute a change from the proposed rule.

Initially proposed § 5.183(a) stated that evidence of dependency must be received within 1 year “of” VA's request. We propose to clarify the regulation to state that the evidence must be received “no later than 1 year after” VA's request in order to eliminate ambiguity with regards to the date of submission of evidence. We have made similar changes throughout this regulation, and throughout this document, where we previously stated “1 year of” to now state “1 year after”. These additional changes to this rule are intended to simplify the general rule and the exceptions thereto. Notably, we propose to move paragraph (c) into paragraph (a) and reorganize paragraph (a).

Initially proposed § 5.183(b)(3) stated the effective date for establishing the dependency of an adopted child. However, it did not specify that in order for these dates to apply, VA must receive information of the adoption no later than 1 year after the event. We therefore propose to correct this omission by stating “For an adoption, the earliest of the following dates, as applicable, if VA receives information about the adoption no later than 1 year after the adoption”. This change is consistent with § 3.401(b)(1)(i) and current practice.

§ 5.184 Effective Dates of Reductions or Discontinuances Based on an Event That Changes Dependency Status

We propose to combine the effective date provisions of initially proposed §§ 5.181(c), 5.184, and 5.198 into one section to make them easier to find and to avoid redundancy. We propose to mark § 5.198 as reserved.

As initially proposed, we referred to a marriage, divorce, annulment, or death as a “change” in dependency status. However, these are “events” that result in “changes” in dependency status. For clarity, we propose to refer to these as an “event that changes” dependency status.

In initially proposed § 5.198(b), we stated, “VA will pay the reduced rate or discontinue benefits effective the first day of the month that follows the month in which the divorce or annulment occurred.” We have determined that the term “occurred” was ambiguous because under some states' laws, the divorce or annulment does not take effect immediately after the court issues the decree. We therefore propose to revise this language to state, “VA will pay . . . in which the death occurred or in which the divorce or annulment became effective.” For the same reason, we propose to make a conforming change to § 5.205(b)(1) and (2), regarding annulment, and (c)(1) and (2), regarding divorce.

§ 5.190 Status as a Spouse

We have determined that there is no need to establish a rule for “status” as a spouse. First, the term is plain language and does not need a specialized definition for VA purposes (unlike, for example, the term “surviving spouse”, which does have a specialized meaning). There can be no question that a reference to a “spouse” is a reference to a person's marriage partner. Second, proposed § 5.191 more than adequately defines a valid marriage for VA purposes. To the extent that proposed § 5.190 had implemented the 38 U.S.C. 101(31) requirement that a spouse be of the opposite sex, that requirement is contained in proposed Start Printed Page 71097§ 5.191. Hence, we propose to delete this rule and mark § 5.190 as reserved.

§ 5.191 Marriages VA Recognizes as Valid

Initially proposed § 5.191 referred to deemed-valid marriages as an exception to the general rule set forth in this section. However, a deemed-valid marriage is not an exception to the types of marriages recognized by VA; rather, it is one type of such marriages. Therefore, we propose to restructure § 5.191 and add a paragraph (c). In addition, we propose to change the term “is” valid to “was” valid. Because the laws of the states may change, we want to specify that the marriage had to be valid at the time that it occurred. Finally, we propose to change the phrase “the right to benefits” in § 5.191(b) to “entitlement to benefits”. This change improves clarity and is consistent with the language of other part 5 VA regulations.

Initially proposed § 5.191(a) and (b) used the term “parties” to mean “persons”, as stated in the introductory sentence. In order to avoid confusion, we propose to change the term “parties” to “persons” in paragraphs (a) and (b).

§ 5.192 Evidence of Marriage

As stated in our discussion of § 5.181 above, VA requires the first type of evidence listed in the relevant section as proof of a certain relationship, if it is obtainable. If it is unobtainable, then VA will accept the next listed type of evidence that is obtainable to prove the relationship. In part 3, this basic principle is stated in 38 CFR 3.204(b), which refers the reader to §§ 3.205 through 3.211. It is helpful to state this principle in each section where it applies, and we therefore propose to state it in §§ 5.192(c), 5.221(b)(2), 5.229, and 5.500.

§ 5.193 Proof of Marriage Termination Where Evidence Is in Conflict or Termination Is Contested

We propose to make minor revisions to § 5.193 for clarity.

§ 5.194 Acceptance of Divorce Decrees

We propose to make minor revisions to § 5.194 for clarity.

§ 5.196 Void or Annulled Marriages

We propose to combine initially proposed §§ 5.195 and 5.196 to improve clarity and eliminate the need for users to refer to two regulations to address the issue of void or annulled marriages. The content of both initially proposed regulations would now appear in § 5.196. Section 5.196(a)(1) was initially proposed as § 5.195. Section 5.196 was initially proposed as § 5.196(a). We propose to mark § 5.195 as reserved.

One commenter questioned VA's authority to determine whether a marriage was void in accordance with the law of the place that governs the marriage's validity. The commenter opines that 38 U.S.C. 103(c) does not appear to provide VA with jurisdiction or authority to make an independent adjudication on the validity of a veteran's marriage.

As stated in the preamble to the initially proposed rule, current part 3 includes references to “void” marriages, but it does not explain the meaning of a “void” marriage. See 38 CFR 3.207(a). Under 38 U.S.C. 103, VA does have the authority to make adjudicative decisions on the validity or legality of a marriage when determining whether or not a person is or was a spouse of a veteran for VA purposes. The commenter's suggested interpretation that the statute merely allows for the recognition of marriage notwithstanding contrary state law is not consistent with the “whether or not” wording of the statute or with VA's long-standing interpretation of the statute. The statute provides that determinations of validity of marriage be made according to the law of the place where the parties resided at the time of the marriage or the law of the place where the parties resided when the right to benefits accrued. This does not mean VA is adjudicating the status of the marriage for purposes of state civil law, which the commenter seems to misunderstand VA to be doing. We therefore propose to make no changes based on this comment.

This commenter further suggests that any new rule regarding VA's authority to determine the validity of a marriage as it pertains to a veteran's surviving spouse or a veteran's child, should include a procedural reference of such questions to the Regional Counsel because VA adjudicators are generally not equipped to research and determine such matters. We agree with this suggestion. In fact, VA has long-standing procedural guidelines for determination of a void marriage. In such cases, the Veterans Service Representative collects all of the pertinent information and evidence from the claimant and files the case with Regional Counsel for a legal opinion as to whether or not the marriage is void. To implement this suggestion, we have revised proposed § 5.196 to indicate that VA Regional Counsel will make the determination concerning whether a marriage is void under the law of the place that governs the validity of the marriage.

§ 5.200 Surviving Spouse: Requirement of Valid Marriage to Veteran

We propose to reorganize initially proposed §§ 5.200 and 5.201 to eliminate redundancy and potentially confusing cross referencing, and to significantly clarify the rules. First, we propose to renumber initially proposed § 5.201 as § 5.200. We have also renamed the rule as, “Surviving spouse: Requirement of valid marriage to veteran.” This title is more descriptive of the rules within this section. This reorganization is for clarity and simplification.

In § 5.200(a), we propose to simplify several initially proposed paragraphs to state that in order to qualify as a surviving spouse, the marriage between the veteran and the person by or for whom surviving-spouse status is sought must have met the requirements of § 5.191, unless the “deemed valid” exception in paragraph (b) applies.

In § 5.200(b)(1), we clarify that there must have been an attempt at legal marriage and that the person seeking surviving-spouse status must have believed that a valid marriage resulted and lasted until the veteran died. This is not a change from current practice. We also clarify that the marriage must have lasted for 1 year unless the person had a child with the veteran. The proposed rule had required that a child have been both “of or before the marriage”; however, because the marriage must have continued until the veteran died, the result is that the child may have been born at any time. Thus, the simplified language in § 5.201(b)(1) is not substantively different from the current and proposed rules.

Initially proposed § 5.201(c) did not clearly define the phrase “no knowledge of legal impediment”. We propose to clarify the definition of legal impediment in initially proposed § 5.201(c), which is now renumbered as § 5.200(b)(2). This clarification is consistent with current practice. We also propose to clarify the evidence that the person must file under § 5.192(c), the requirements of which must be met under § 5.200, without any contradictory evidence.

We also propose to reword the regulation text in § 5.201(e), which is now renumbered as § 5.200(b)(4), for clarity.

§ 5.201 Surviving Spouse: Requirements for Relationship With the Veteran

We propose to renumber initially proposed § 5.200 as § 5.201, and rename the section, “Surviving spouse: Requirements for relationship with the Start Printed Page 71098veteran”. This title is more descriptive of the rules within this section. This reorganization was made for clarity and simplification.

Initially proposed § 5.200(a)(2) (now renumbered as § 5.201(a)) specified that to qualify as a surviving spouse, that person must have been a member of the opposite sex from the veteran. Because § 5.191, “Marriages VA recognizes as valid”, requires that a valid marriage must be to a person of the opposite sex, that provision is unnecessary in § 5.201(a) and we propose to remove it. We also propose to make several changes to improve clarity and consistency with the language of other VA regulations.

We propose to move the content of initially proposed § 5.430(b), “Marriage date requirements for Improved Death Pension”, to § 5.201(b)(1), “More than one marriage to the veteran.” The content is based on 38 U.S.C. 103(b), which is not limited to just Improved Pension.

We propose to clarify the provision concerning whether a separation was temporary, initially proposed as § 5.200(b)(3). In § 5.201(b)(4) we propose to add the term “with estrangement” to modify “separation” to accurately reflect the circumstances to which paragraph (b)(4) applies.

§ 5.203 Effect of Remarriage on a Surviving Spouse's Benefits

The preamble to initially proposed § 5.203(a) stated that it would be a new provision, restating part 38 U.S.C. 101(3), the statutory definition of surviving spouse. Part 3 restates the statutory definition of surviving spouse in § 3.50(b). As a result of the elimination of initially proposed §§ 5.200 and 5.202, and the incorporation of some of those initially proposed provisions in currently proposed § 5.203, we now propose to restate § 3.50(b)(2) in § 5.203(a)(2).

Initially proposed § 5.202 concerned the effect of a Federal court decision on a remarriage determination. We propose to mark § 5.202 as reserved, and include this rule in § 5.203(a)(1). We also propose to change the regulation text in proposed § 5.203(a)(1) from “In determining eligibility for pension, death compensation, or dependency and indemnity compensation” to “In determining eligibility for benefits” to clarify that the rule applies to all benefits based on surviving-spouse status. It simplifies the regulation.

We propose to revise the language of initially proposed paragraph (c)(4), now redesignated as (d)(4), by removing the phrase “openly to the public”. That phrase is unnecessary because that provision is already stated in paragraph (a)(2). For the same reason, we have removed that phrase from initially proposed paragraph (d)(1)(iii), now redesignated as paragraph (e)(1)(iii).

One commenter questioned why there was a rule that allowed reinstatement of benefits to a surviving spouse who is no longer remarried because of the death of the second spouse, but there was no rule that allowed the surviving spouse to establish her initial entitlement to benefits after the death of her second spouse. The commenter provided the following example. A surviving spouse is married to the veteran for over 30 years. The veteran subsequently dies and the surviving spouse remarries, but the surviving spouse's second husband dies after several years of marriage. After the death of her second husband, the surviving spouse wants to claim VA benefits. The commenter further indicated that VA allows for the surviving spouse to receive benefits only if her second husband died before November 1, 1990, but in the scenario that was presented, the veteran died in January 1991. The commenter contends that the surviving spouse would not be entitled to benefits because this is not considered to be a reinstatement of benefits, but rather a first-time application. Initially proposed § 5.203(c) stated that the surviving spouse of the veteran may be entitled to receive benefits if the remarriage ended before November 1, 1990. This rule corroborates the commenter's statement. However, initially proposed § 5.203(d) (now § 5.203(e)) allowed a surviving spouse to be eligible for benefits if he or she was otherwise ineligible for DIC under the laws in effect prior to June 9, 1998, because of the surviving spouse's remarriage after the veteran's death. Although the surviving spouse's eligibility to DIC is said to be reinstated under § 5.203(e), this section applies to reopened as well as original claims. The limitation is that no payments may be issued for any period before October 1, 1998. Because proposed § 5.203(e) already addresses the concerns of the commenter, we propose to take no action based on this comment.

We propose to clarify § 5.203(e)(2) to state that no payments may be made for any period before October 1, 1998. The regulation text stated the month, and year, but failed to state the date. The exact date is needed in order to avoid an erroneous payment.

We also propose to clarify § 5.203(f)(2) to state that no payments may be made for any period before January 1, 2004. The regulation text stated the month and year, but failed to state the date. The exact date is needed in order to avoid an erroneous payment.

§ 5.220 Status as a Child for VA Benefit Purposes

We propose to reword the introductory text in § 5.220 for clarity by improving sentence structure.

Initially proposed § 5.220(a), began with the exception prior to the rule. To improve readability, we propose to place the exception at the end of the general rule.

In nitially proposed § 5.220(b)(2)(i), which is now paragraph (b)(1), we referred to a child who is “incapable of self-support through his or her own efforts by reason of physical or mental disability”. We propose to eliminate the phrase “through his or her own efforts” because it is redundant of “self-support” and might be misinterpreted to mean that the child intentionally caused his or her incapacity, which is clearly not what we intended.

We propose to move the content of initially proposed § 5.220(c)(2) to § 5.226(c). Section 5.226(c) elaborates on the criteria set forth in § 5.220(c)(2). This approach also enables us to eliminate the need to refer back to § 5.220 in § 5.226(c). We will leave § 5.220(c)(2) as a cross-reference to § 5.226.

We propose to add a new paragraph (d) to proposed § 5.220. In accordance with § 3.503(a)(2), this new paragraph would provide that a person is still considered a child of a veteran even if the person has entered active duty.

§ 5.221 Evidence To Establish a Parent/Natural Child Relationship

We propose to reword the regulation text in § 5.221(a)(2) for clarity.

We propose to delete § 5.221(a)(2)—Note. The content of the Note is adequately covered in § 5.220(c)(2), so it is unnecessary.

Initially proposed § 5.221(b)(2)(iii)(A) limited evidence of paternity to church records of baptism without referencing other religions. We propose to revise the rule to allow any “religious-context record documenting the birth of the child” in order to eliminate any perceived bias for or against a particular religion or faith. We propose to add similar language to § 5.229(b).

§ 5.222 Evidence To Establish an Adopted Child Relationship

We propose to add a sentence to the initially proposed undesignated first paragraph to state the purpose of this section. We propose to make technical revisions to § 5.222 to clarify that this rule is an exception to § 5.181(b). We Start Printed Page 71099propose to make similar clarifications to §§ 5.223 and 5.224.

We propose to add an order of preference of types of evidence VA requires to prove an adopted child relationship. We explained orders of preference for evidence in our discussion of § 5.181.

§ 5.223 Child Adopted After a Veteran's Death

Originally proposed § 5.223 (a) (now (b)) required, inter alia, that, “The person adopted was living in the veteran's household at the time of the veteran's death . . .” This language was based on § 3.57(c)(1). Upon further review, we note that § 3.210(c)(2) uses the phrase “was a member of the veteran's household” to describe the same criteria for children adopted after a veteran's death. To make § 5.223(b) consistent with similar provisions in part 5 (§§ 5.220, 5.226, 5.233, 5.332) we propose to change the paragraph to read, “was a member of the veteran's household”. We therefore propose not to restate the language of § 3.57(c)(1) and (3) in part 5 because it is redundant of the language in § 3.210(c)(2).

§ 5.225 Child Status Based on Adoption Into a Veteran's Family Under Foreign Law

Our definition of “State” in § 5.1 includes territories and possessions of the US. Therefore it is unnecessary to include the Commonwealth of the Northern Mariana Islands in this section. We propose to remove it.

§ 5.227 Child Status Based on Permanent Incapacity for Self-Support

We have clarified the regulation text in § 5.227(b)(1)(iv). The initially proposed rule said that “evidence that a person was not employed before or after reaching 18 years old tends to show incapacity for self support when the lack of employment was due to the person's physical or mental disabilities and not due to unwillingness to work or other factors unrelated to the person's disability.” We believe that the phrase “before or after reaching 18 years old” could be unclear and we therefore propose to clearly state that the rule applies to a person who “has never been employed”.

We propose to revise initially proposed § 5.227(c) to clarify that this rule does not exclude from consideration any particular evidence or require that any evidence should be treated more favorably. The rule simply provides guidance to VA employees and to the public about likely sources of evidence relevant to the question whether a person is permanently incapacitated.

§ 5.228 Exceptions Applicable to Termination of Child Status Based on Marriage of the Child

We propose to add an introductory sentence to give context to initially proposed § 5.228.

§ 5.229 Proof of Age or Birth

We propose to revise initially proposed § 5.229 to clearly state that the evidence described therein must be provided in accordance with the order of preference in which it is listed, as discussed earlier in proposed § 5.192, and have also reorganized the rule to improve readability.

In addition, we propose to remove the cross reference to § 5.180(e) (now § 5.181(d)), “Acceptability of photocopies”. That paragraph applies equally to all of the sections listed in § 5.181(c), so there is no need to reference it in any of those sections.

In the initially proposed paragraph (a)(4) we inadvertently changed the persons who could certify a birth. We stated that a claimant or beneficiary could prove age or birth with “[a]n affidavit or certified statement from a physician or midwife present during the birth”. However, 38 CFR 3.209(d), from which this paragraph derives, allows proof of age or birth with an “[a]ffidavit or a certified statement of the physician or midwife in attendance at birth”. We propose to use this language because it is a more precise statement of the requirement.

§ 5.230 Effective Date of Award of Pension or Dependency and Indemnity Compensation to, or for, a Child Born After the Veteran's Death

We propose to reword the section for clarity.

§ 5.234 Effective Date of an Award, Reduction, or Discontinuance of Benefits Based on Child Status Due to Permanent Incapacity for Self-Support

We propose to restructure initially proposed § 5.234(a), by creating separate paragraphs (a)(1) and (2) for effective dates of awards and for reductions and discontinuances. We believe this structure will better inform readers on the contents of this section.

§ 5.238 Status as Veteran's Parent

In initially proposed § 5.240(c) we stated that the term “parent” includes a natural mother or father of an illegitimate child “if the usual family relationship existed.” Upon further review, we have determined that there is no statutory or regulatory authority for this provision, and we therefore propose to remove it.

Comment Relating to a Different Portion of This Rulemaking

A comment was submitted by a member of the public concerning title 32 National Guard troops suggesting that their active duty for training be considered as “active duty”, thereby allowing them veteran status. This comment is outside the scope of this proposed rule published under RIN 2900-AL94, but is relevant to another NPRM, RIN 2900-AL67, “Service Requirements for Veterans”. This comment was addressed together with all of the other submissions received in connection with RIN 2900-AL67.

Changes in Terminology for Clarity and/or Consistency

We also propose to correct our use of the terms “claim” and “application”. Under 38 CFR 3.1(p), “Claim—Application” is defined as “a formal or informal communication in writing requesting a determination of entitlement, or evidencing a belief in entitlement, to a benefit”. As stated in initially proposed § 5.1, for purposes of part 5, “claim means a formal or informal communication in writing requesting a determination of entitlement or evidencing a belief in entitlement, to a VA benefit under this part” and as stated in proposed § 5.1, “application means a specific form required by the Secretary that a claimant must file to apply for a benefit”. We similarly propose to edit the part 5 regulations proposed in AL94 to correct other inconsistencies in terminology.

X. Subpart E: Claims for Service Connection and Disability Compensation Service-Connected and Other Disability Compensation

A. Service-Connected and Other Disability Compensation

In a document published in the Federal Register on September 1, 2010, we proposed to revise VA regulations governing service-connected and other disability compensation. See 75 FR 53744. We provided a 60-day comment period that ended November 1, 2010. We received submissions from 10 commenters: National Organization of Veterans Advocates, National Veterans Legal Services Program, Paralyzed Veterans of America, Vietnam Veterans of America, and six members of the general public.

One AM07 commenter commended VA “for the hard work and dedication that its personnel have put into this important project” and stated that, Start Printed Page 71100“Overall . . . VA did achieve its goals to make its service-connected regulations `logical, claimant-focused and user friendly[.]' ”

One commenter stated that while the general idea of the proposed rule is good, some of the proposed changes may be adverse to veterans. However, the commenter did not specifically explain which changes might be adverse. The commenter also urged that VA offer online access to court decisions cited in its rulemaking documents.

Because the commenter did not specifically explain which changes might be adverse to veterans, we cannot respond to that assertion, and we propose to make no change based on that comment. Regarding the suggestion on court decisions, we note that decisions of the U.S. Court of Appeals for Veterans Claims are available on their Web site at www.courts.cavc.gov and decisions of the U.S. Court of Appeals for the Federal Circuit are available at http://www.cafc.courts.gov. We therefore propose to make no changes based on these comments.

Another commenter asserted that because of the complexity of the regulations proposed in AM07, veterans will incur very expensive legal costs in order to interpret them and determine what benefits they are entitled to. The commenter urged VA to add a section at the end of part 5 outlining what a veteran's options are if the veteran disagrees with a VA decision. The commenter also suggested that VA provide a telephone number to call in the event that a veteran does not understand the final rule on part 5.

VA's intent in rewriting these regulations was to make them less complex. To the extent that commenter believes that he or she requires assistance in preparing a claim for benefits, VA has recognized 87 Veterans Service Organizations (VSO) for purposes of providing no-cost assistance with claims for VA benefits. Each of these VSOs has accredited representatives available to help veterans in preparing claims. A searchable list of recognized VSOs and accredited representatives is available at http://www.va.gov/​ogc/​apps/​accreditation/​index.asp.

The regulations on how to file a notice of disagreement with a VA decision are found in 38 CFR parts 19-20, not in part 3, so that comment is outside the scope of this rulemaking. VA does not offer a phone number for purpose of explaining its regulations; we do not believe that would be an efficient use of government resources. But VA does have a number where veterans can call to inquire about the status of their benefits claims (1-800-827-1000), which veterans find very helpful. For these reasons, we propose to make no changes based on this comment.

One commenter stated that he is opposed to “patient registries” in the prescription process and that all drugs should be taken or not at the discretion of the patient with the advice of his or her doctor. Because this comment is outside the scope of this rulemaking, we propose to make no change.

One commenter urged that VA suspend its Regulation Rewrite Project until it is shown how the implementation of part 5 will interact with certain other VA programs: Virtual VA, Virtual Regional Office and the Veterans Benefits Management System. We do not believe that the implementation of part 5 will disrupt those information technology systems because they were designed to accommodate changes in law or regulation. VA will attempt to implement part 5 in a manner that causes the minimum possible disruption to VA claims processing operations. We believe that over the long term, having clear regulations for our employees to apply will significantly improve timeliness and accuracy in claims processing.

§ 5.242 General Principles of Service Connection

Initially proposed § 5.242(a) states that “VA will give due consideration to any evidence of record concerning the places, types, and circumstances of the veteran's service . . .” One commenter suggested that we insert the phrase “and records constructively in the VA's possession” after “evidence”, to ensure that VA complies with the constructive possession rule set forth in Bell v. Derwinski, 2 Vet. App. 611 (1992).

We do not believe it is necessary to include Bell's constructive possession rule in VA regulations, and doing so might actually confuse readers. Any evidence that is constructively in VA's possession would already be encompassed by the rule in § 5.4(b) that VA decisions will be based on a review of the entire record. Adding that this includes evidence within VA's possession and which could reasonably be expected to be a part of the record could imply a requirement that the agency of original jurisdiction (AOJ) must consider material that is not actually in the record, which would be impossible. Furthermore, if the AOJ is aware of such evidence and it is “necessary to substantiate the claim”, then the AOJ is already under a duty to obtain it and add it to the record (see 38 CFR 3.159, to be codified in part 5 as § 5.90). We therefore propose to make no change based on this comment.

One commenter expressed concern that we did not repeat in proposed § 5.242 the following language from 38 CFR 3.303(a): “Determinations as to service connection will be based on review of the entire evidence of record, with due consideration to the policy of the Department of Veterans Affairs to administer the law under a broad and liberal interpretation consistent with the facts in each individual case.”

We inadvertently failed to explain why we did not include this language in initially proposed § 5.242. Because proposed § 5.4(b) would clearly state that “VA will base its decisions on a review of the entire record”, we believe it would be redundant and possibly confusing to restate this principle in specific sections in part 5 (as does part 3). Similarly, § 5.4(b) states:

It is VA's defined and consistently applied policy to administer the law under a broad interpretation, consistent with the facts shown in every case. VA will make decisions that grant every benefit that the law supports while at the same time protecting the interests of the Government.

Since this language is substantially the same as the language quoted by the commenter, and it applies to all VA claims rather than just service connection, there is no need to repeat it in § 5.242.

One commenter urged VA to establish a new policy by revising initially proposed § 5.242 to create a presumption based on H.R. 1490, 110th Congress, 1st session. The commenter suggested that VA include the following language in § 5.242(c):

(1) A claimant presenting a claim for benefits with respect to a service-connected disability or death shall be presumed to have presented a valid claim of service connectedness, subject to the requirements of subparagraph (2), unless the Secretary determines that there is clear and convincing evidence to the contrary.

(2) A claimant presenting a claim described under subparagraph (1) shall be required to support such claim with proof of service referred to in such claim, and a brief description of the nature, including the connection to such service, of the disability or claim.

The commenter asserted that this presumption would allow VA to quickly process backlogged claims.

The purpose of the Regulation Rewrite Project is to make VA's compensation and pension regulations more logical, claimant-focused, and user-friendly, not to serve as a vehicle for making major changes to VA Start Printed Page 71101policies. Thus, the comment is outside the scope of this rulemaking.

§ 5.243 Establishing Service Connection.

Two commenters expressed concern that VA's use of the term “proximately caused” in proposed § 5.243(a) would improperly narrow the criteria for showing incurrence or aggravation. One of these commenters believed that using the term would improperly import a restrictive tort law concept into VA's regulations on service connection. Although this was not our intent, to avoid any such misinterpretation, we propose to revise the term to “due to or the result of” as suggested by one of the commenters. For the same reason, we propose to make the same revision in §§ 5.246 and 5.247.

One of these commenters also rejected the use of term “caused by” in proposed § 5.241(a) and (b), which the commenter suggested be changed to “ `incurred' or `aggravated' ” (as in current 38 CFR 3.1(k) and 3.303(a)) or “related to”. The commenter similarly, urged VA to replace “proximately caused” in proposed § 5.243(a) with “related to” and “causal link” in proposed § 5.243(a)(3) with “relationship.” The commenter acknowledged that, as we noted in the preamble to proposed § 5.243, the court in Shedden v. Principi, 381 F.3d 1163, 1166-67 (Fed. Cir. 2004) explained that service connection requires “a causal relationship between the present disability and the disease or injury incurred or aggravated during service” (citing Caluza v. Brown, 7 Vet. App. 498, 505 (1995)). Nevertheless, the commenter believed that use of the causation terms that VA proposed in §§ 5.241 and 5.243 will cause confusion by imposing a “strict medical standard” in cases where it would be “inappropriate and excessive.” The commenter asserted that diseases such as tempromandibular joint syndrome and ulcers “may not be susceptible to definitive proof that the disease was `caused by' the incident in service.” The commenter also noted that VA has determined that there is a positive association between herbicides and three medical conditions “even though there is no proof that exposure to herbicides caused veterans to develop the conditions.”

As a preliminary matter, we note that the language “proximately caused” in proposed § 5.243(a) was merely a recitation of the title of proposed § 5.246, rather than regulation text. More fundamentally, we note that the “causal relationship” principle set forth in the Caluza case is a well established principle of veterans law and no court has held that it is in any way inconsistent with the regulatory language in §§ 3.1(k) or 3.303(a). We disagree with the assertion that the use of the terms that VA proposed will cause confusion by imposing a “strict medical standard” in cases where it would be “inappropriate and excessive” and the commenter offers no support for this assertion. We likewise disagree with the assertion that the proposed rules would impose some new “definitive proof” standard for diseases such as temporomandibular joint syndrome and ulcers, and again the commenter offers no support for this assertion. Regarding the commenter's statement that VA has determined that there is a positive association between herbicides and three medical conditions “even though there is no proof that exposure to herbicides caused veterans to develop the conditions”, we note that this determination was made pursuant to an entirely different statute (38 U.S.C. 1116) than the statutes that authorize the causation terms used in §§ 5.241 and 5.243 (38 U.S.C. 1110 and 1131). Our use of the causation terms in §§ 5.241 and 5.243 will express the same concepts as stated in §§ 3.1(k) or 3.303(a), with no substantive change, and in a way that is more clear to those using the regulations. For these reasons, we propose to make no changes based on these comments.

One commenter urged that, in order to comply with the standard for continuity of symptomatology contained in Savage v. Gober, 10 Vet. App. 488, 498 (1997), VA should revise initially proposed § 5.243(d) by inserting “injury or disease” before “or signs or symptoms” in paragraphs (d)(1) and (2) and also in paragraph (d)(3). For the same reason, the commenter also suggested that VA revise paragraph (d)(3) to read, “(3) Competent evidence relates a present injury or disease or present signs or symptoms to the injury or disease or signs or symptoms which occurred during service or during an applicable presumptive period for a disease.”

Regarding the suggested additions to paragraphs (d)(1) and (2), we note that the Savage court summarized the continuity provision of 38 CFR 3.303(b) as follows:

In sum, then, the rule here established is as follows * * * If the chronicity provision is not applicable, a claim may still be well grounded or reopened on the basis of § 3.303(b) if the condition is observed during service or any applicable presumption period, continuity of symptomatology is demonstrated thereafter, and competent evidence relates the present condition to that symptomatology.

Id.

In initially proposed § 5.243(d)(1) we incorporated the requirement, as stated by the Savage court, “that the condition [was] observed during service or any applicable presumption period” with the phrase “signs or symptoms of an injury or disease during active military service or during an applicable presumptive period.” In initially proposed paragraph (d)(2) we incorporated the requirement, as stated by the court, that “continuity of symptomatology [was] demonstrated thereafter” with the phrase “The signs or symptoms continued from the time of discharge . . . until the present.” In initially proposed paragraph (d)(3) we incorporated the requirement, as stated by the court, “that competent evidence relates the present condition to that symptomatology” with the phrase “The signs or symptoms currently demonstrated are signs or symptoms of an injury or disease, or the residuals of an injury or disease, to which paragraph (d)(1) of this section refers.”

We believe that the language of initially proposed § 5.243(d) accurately restates the intent of current § 3.303(b) as summarized by the Savage court. As the court stated, the keys to the continuity doctrine are that “the condition is observed [through signs or symptoms] during service or any applicable presumption period, continuity of symptomatology [i.e. signs or symptoms] is demonstrated thereafter, and competent evidence relates the present condition to that symptomatology.” Savage, 10 Vet. App. at 498. Following the commenter's suggestion of inserting “injury or disease” would introduce a new element to the doctrine which is not found in § 3.303(b) nor the court cases interpreting that paragraph. Moreover, it would risk confusing readers by blurring the line between the chronicity doctrine and the continuity doctrine. For these reasons, we propose to make no change based on this comment.

Since we published AM07, “Service-Connected and Other Disability Compensation” 75 FR 53744 (Sept. 1, 2010), VA has determined that initially proposed § 5.243 did not accurately restate current § 3.303(b) in the following respect. Section 5.243 would have made “continuity of symptomatology” a separate method of showing service connection distinct from the “chronicity” method set forth in § 3.303(b). In Walker v. Shinseki, 708 F.3d 1331 (Fed. Cir. 2013), the U.S. Court of Appeals for the Federal Circuit explained the correct interpretation of these § 3.303(b) provisions. The Court held that continuity of symptomatology Start Printed Page 71102is actually a means of proving the existence of a chronic disease during military service or an applicable presumptive period. We now propose to correct the error contained in the NPRM by revising the provisions of initially proposed § 5.243(d), which we are moving into paragraph (c).

In addition to misstating the role of continuity of symptomatology, we erroneously stated in initially proposed § 5.243 that the term “chronic disease” included other diseases besides those listed in current § 3.309(a). The Walker court clarified that the term “chronic disease”, as used in § 3.303(b), means only a disease listed in § 3.309(a) and no others. Id. at 1338. We propose to clarify this point in § 5.243(c)(2).

Lastly, we note that initially proposed paragraph (d)(2), which stated, “The signs or symptoms continued from the time of discharge or release from active military service until the present”, omitted a presumptive period. To correct this omission, we propose to insert “or from the end of an applicable presumptive period for a disease” in § 5.243.

In AM07, we stated:

VA's long-standing practice is to apply the principles of chronicity and continuity to residuals of injury. This practice provides a fair and efficient means to determine service connection in certain cases, and it is logical to apply these principles to injuries as well as to diseases. Therefore, proposed § 5.243(c)(1) would also apply to an injury incurred or aggravated in service where the current disability is due to “the chronic residuals of the same injury.”

The court rejected the argument that § 3.303(b) applies to injuries as well as to chronic diseases, stating, “We thus reject Walker's broader argument that continuity of symptomatology in § 3.303(b) has any role other than to afford an alternative route to service connection for specific chronic diseases.” Id. The court also noted that, “The Secretary is free to amend § 3.309(a) if he determines that chronic diseases beyond those currently listed should benefit from the application of § 3.303(b),” and noted that, “the Secretary is currently considering a substantial revision of his regulations concerning service connection for disability compensation”, referring to VA's Regulation Rewrite Project. Id.

As stated above in this preamble, our Veterans Benefits Administration's Transformation Plan will use improved technology and work methods to process disability claims more efficiently. VA has determined that significantly revising the substantive content of our service connection regulations at this time might interfere with this transformation. Moreover, further study is needed to determine the potential impact of such changes, after which VA may conduct a separate rulemaking for this purpose. We therefore propose not to include injuries in § 5.243(c).

§ 5.244 Presumption of Sound Condition on Entry Into Military Service

Initially proposed § 5.244(c)(2) stated, “The presumption of sound condition is rebuttable even if an entry medical examination shows that the examiner tested specifically for a certain injury or disease and did not find that injury or disease, if other evidence of record is sufficient to overcome the presumption.”

One commenter urged that VA clarify paragraph (c)(2) by revising it to read, “The presumption of sound condition is rebuttable, in accordance with subsection (d)(1), below, even if an entry medical examination shows that the examiner tested specifically for a certain injury or disease and did not find that injury or disease, provided other evidence of record is sufficient to overcome the presumption.” The commenter asserted that this revision is needed to ensure the paragraph complies with Kent v. Principi, 389 F.3d 1380, 1383 (Fed. Cir. 2004).

As we stated in the preamble to AM07, we added paragraph (c)(2), which has no part 3 counterpart, to incorporate the Kent holding into VA regulations. The commenter offers no explanation of how initially proposed paragraph (c)(2) is inconsistent with Kent nor how it is unclear in any way. Furthermore, the clear and unmistakable evidence standard of paragraph already applies to rebuttal of the presumption of service connection. We therefore make no change based on this comment.

We propose to exclude initially proposed § 5.244(b) because it is contrary to judicial interpretation of 38 U.S.C. 1111. Smith v. Shinseki, 24 Vet. App. 40 (2010); Crowe v. Brown, 7 Vet. App. 238 (1994). Proposed § 5.244, the part 5 counterpart of 38 CFR 3.304(b), would implement 38 U.S.C. 1111, the presumption of sound condition. We initially proposed paragraph (b), which has no part 3 counterpart, to “clarify that the presumption of sound condition attaches even if the military service department did not conduct an entry medical examination, or if there is no record of an entry examination.” 75 FR 53744, 53750 (Sep. 1, 2010). We explained that “if there was no entry medical examination, then there could be no `defects, infirmities, or disorders noted at the time of the examination, acceptance, and enrollment' that would serve to prevent the presumption from arising.” Id.

Initially proposed at 75 FR 53764, paragraph (b) described a report of entry examination not a condition for application of the presumption as a presumption of sound condition applies even if:

  • The veteran did not have a medical examination for entry into active military service; or
  • There is no record of the examination.

In drafting paragraph (b), we overlooked precedent decisions of the U.S. Court of Appeals for Veterans Claims (CAVC) that held that 38 U.S.C. 1111 requires an entry examination for the presumption to apply. In Smith, the court stated that section 1111 “provides that the presumption applies when a veteran has been `examined, accepted, and enrolled for service.'” 24 Vet. App. at 45. The court said, “Plainly, the statute requires that there be an examination prior to entry into the period of service on which the claim is based.” Id. Although Ms. Smith “attained veteran status because she served the required period of active duty service,” id. at 44, the presumption could not apply in her case because there was no evidence of “an examination made contemporaneous with [her] entry” into the periods of active duty for training with the National Guard on which she based her claim. Id. at 46.

The court explained that “[i]n the absence of such an examination, there is no basis from which to determine whether the claimant was in sound condition upon entry into that period of service on which the claim is based.” Id. at 45. The court's reason why the statute precludes applying the presumption when there was no contemporaneous entry examination, or no evidence of one, was essentially the opposite of our reason why the presumption could apply in those situations.

In Crowe, 7 Vet. App. at 245 (1994), the court stated that the presumption of sound condition “attaches only where there has been an induction examination in which the later-complained-of disability was not detected.” Though the court focused on the term “noted” in section 1111, as VA interpreted the term in 38 CFR 3.304(b), the statement is direct and unequivocal.

Neither Smith nor Crowe was a case of a claimant for disability compensation who sought to apply the presumption of sound condition to a period of active duty even though he or she had no entry examination. Neither Smith nor Crowe was a case of a veteran Start Printed Page 71103of active duty who claimed to have had an entry examination, but there is no record of it. Nonetheless, both decisions made unequivocal statements that mean, in essence, if there was no entry examination, the presumption cannot apply. VA must give deference to the court's interpretation of the plain meaning of a statute. See Cypert v. Peake, 22 Vet. App. 307, 311 (2008) (Deference to department's regulation not warranted when its interpretation of a statute is contrary to the plain meaning of the statutory language). We conclude that the court's interpretation of § 1111 in both cases precludes initially proposed § 5.244(b). Consequently, we have removed it from proposed part 5. We also propose to redesignate paragraphs (c) and (d) as (b) and (c), respectively.

In proposed rule AM07, “Service-Connected and Other Disability Compensation,” 75 FR 53744 (Sept. 1, 2010), we in advertently omitted the first five sentences of current § 3.303(c). We now propose to insert these sentences, with only minor stylistic changes to improve readability, as § 5.244(d).

§ 5.245 Service Connection Based on Aggravation of Preservice Injury or Disease

Initially proposed § 5.245(b)(3) stated the usual effects of medical or surgical treatment in service that ameliorates a preexisting injury or disease, such as postoperative scars, or absent or poorly functioning parts or organs, are not an increase in the severity of the underlying condition and they will not be service connected unless the preexisting injury or disease was otherwise aggravated by service.

One commenter urged that VA clarify paragraph (b)(3) by revising it to read:

(3) Effects of medical or surgical treatment. Where medical evidence establishes by clear and convincing evidence that the usual effects of medical or surgical treatment provided to a veteran in service to ameliorate a preexisting injury or disease, such as postoperative scars, or absent or poorly functioning parts or organs, do not constitute an increase in the severity of the underlying condition, they will not be service connected unless the preexisting injury or disease was otherwise aggravated by service (emphasis added).

The commenter asserted that this revision is needed to ensure the paragraph complies with Hines v. Principi, 18 Vet. App. 227, 241-42 (2004).

As a preliminary matter, we note that the Hines case does not impose any requirement that there be “clear and convincing” evidence that the usual effects of treatment provided during service do not constitute an increase in the severity of the underlying condition. Likewise, there is no such requirement in current § 3.306(b)(1), the regulation on which initially proposed § 5.245(b)(3) was based. The commenter offers no explanation of how initially proposed paragraph (b)(3) is inconsistent with Hines or § 3.306(b)(1) nor how it is unclear in any way. We therefore propose to make no change based on this comment.

§ 5.249 Special Service Connection Rules for Combat-Related Injury or Disease

One commenter urged VA to establish a new policy by revising initally proposed § 5.249 to create a presumption based on H.R. 6732, 110th Congress, 2nd session. The commenter suggested that VA include the following language in § 5.249: “(iii) Deployment during service to a theatre of combat operations or hostilities during a period of war.”

The purpose of the Regulation Rewrite Project is to make VA's compensation and pension regulations more logical, claimant-focused, and user-friendly, not to serve as a vehicle for making major changes to VA policies. Thus, the comment is outside the scope of this rulemaking.

§ 5.250 Service Cnnection for Posttraumatic Stress Disorder

One commenter expressed concern that proposed § 5.250 modifies the provision in 38 CFR 3.304(f) that states, “[i]f the evidence establishes that the veteran engaged in combat with the enemy and the claimed stressor is related to that combat . . . the veteran's lay testimony alone may establish the occurrence of the claimed in-service stressor.” The commenter believed that proposed § 5.250 “shifts the burden to the veteran by requiring `credible evidence from any source, other than the claimant's statement, that corroborates the occurrence of the in-service stressor.' ” Another commenter also expressed the same concerns.

Proposed § 5.250 does not increase the burden of proof on veterans claiming service connection for posttraumatic stress disorder (PTSD). The provision quoted by the commenter is merely a restatement of the language in the introductory paragraph of § 3.304(f). The special provision for combat veterans that the commenter referred to is discussed in proposed § 5.250(d). That paragraph refers the reader to the rule for combat veterans contained in § 5.249. As we stated in the NPRM preamble, because § 5.249 applies to all claims, there is no need to repeat it in § 5.250. We therefore propose to make no change based on this comment.

One commenter urged that VA revise initially proposed § 5.250 to eliminate the “credible supporting evidence” requirement for PTSD stressors which would permit a VA fact-finding hearing official to consider a veteran's sworn, personal hearing testimony—if believed by the VA hearing official—as evidence that can establish that the veteran was exposed to an adequate stressor. The commenter asserted, among other things, that this requirement, which is based on an identical, long-standing provision in 38 CFR 3.304(f), is contrary to 38 U.S.C. 5107(b), which states, “The Secretary shall consider all information and lay and medical evidence of record in a case . . .”

We respectfully note that the legal arguments raised by the commenter were addressed and rejected by the U.S. Court of Appeals for the Federal Circuit in Nat'l Org. of Veterans Advocates v. Sec'y of Veterans Affairs, 330 F. 3d 1345 (Fed. Cir. 2003). In NOVA, the court expressly held that § 3.304(f) does not permit VA to deny service connection for PTSD in non-combat veterans without considering all the information and evidence of record in cluding lay evidence. 330 F.3d at 1352. It went on to hold that § 3.304(f) was consistent with 38 U.S.C. 5107. Id. Because the court has upheld this provision, and because we continue to believe that the rationale for the requirement is valid, we propose to make no changes based on this comment.

Initially proposed § 5.250(a)(1), required that in claims for service connection for PTSD, there must be “[m]edical evidence diagnosing PTSD in accordance with § 4.125(a) of this chapter.” 75 FR at 53765. See 38 CFR 4.125(a) (2010). Under § 4.125, all mental disorder diagnoses must conform to the American Psychiatric Association's Diagnostic and Statistical Manual of Mental Disorders, Fourth Edition (1994) (“DSM-IV'). Id. One commenter asserted that initially proposed § 5.250(e)(2)(ii) is inconsistent with the DSM-IV's first diagnostic criterion to support a diagnosis of PTSD because the proposed paragraph uses terms that the DSM-IV does not use. Specifically, the commenter noted that under the DSM-IV's first diagnostic criterion, a person who has been exposed to a psychologically traumatic event, like those events described in initially proposed § 5.250(e)(2)(i), VA omitted the term “intense” and instead stated that must have experienced a response to the traumatic event that Start Printed Page 71104“involved intense fear, helplessness, or horror.” However, under initially proposed § 5.250(e)(2)(ii), a veteran's response to a traumatic event must “involve [ ] a psychological or psycho-physiological state of fear, helplessness, or horror.” 75 FR at 53766. The commenter noted that the terms “psychological” and “psycho-physiological” do not appear in the DSM-IV.

We note that § 5.250(e)(2)(ii) was based on a provision in § 3.304(f)(3), which VA added by a separate rulemaking published July 13, 2010 (75 FR 39843) and which has been challenged in the case Paralyzed Veterans of America v. Sec'y of Veterans Affairs, 412 F. App'x 286 (Fed. Cir. 2011). We believe that it would be premature to revise proposed § 5.250(e)(1) until the U.S. Court of Appeals for the Federal Circuit has rendered a decision in the above captioned case, and we therefore propose to make no change based on these comments.

Several commenters suggested that proposed § 5.250(e)(1) be changed to allow the stressor to be confirmed by any examining or treating psychiatrist or psychologist, not just a VA psychiatrist or psychologist. We note this provision is based on a provision in § 3.304(f)(3), which VA added by a separate rulemaking published July 13, 2010 (75 FR 39843) and which has been challenged in the case Paralyzed Veterans of America v. Sec'y of Veterans Affairs, 412 F. App'x 286 (Fed. Cir. 2011). We believe that it would be premature to revise proposed § 5.250(e)(1) until the U.S. Court of Appeals for the Federal Circuit has rendered a decision in the above captioned case, and we therefore propose to make no change based on these comments.

Another commenter urged VA to revise proposed § 5.250 (f) “Special rules for establishing a stressor based on personal assault”, to allow veterans diagnosed with PTSD resulting from Military Sexual Trauma (MST) six months to respond to a VA request for more information about their stressor, rather than the 30 days under current VA practice pursuant to the Veterans Claims Assistance Act (VCAA). The commenter asserted that, “Without more time veterans with PTSD secondary to MST are unlikely to comply.” In support of this assertion, the commenter stated:

Veterans with PTSD as a result of MST often feel guilt or shame. Many of these veterans have not shared with family and friends that they were sexually assaulted in the military. If a veteran receives a VCAA notice asking for additional evidence, such as statements regarding changes in behavior from friends and family, the guilt and shame that they are suffering make it unlikely that the veteran will respond to the 30 day deadline of the VCAA notice. Many of ICLC's clients are in mental health treatment facilities because of the impact of their PTSD secondary to MST. These clients cannot handle day to day functions. Responding within 30 days to a VCAA notice is unrealistic. This is especially true considering that the information the Regional Office requires can be difficult to obtain. Records from rape crisis centers are destroyed after a period of time and it can take as long as nine months to obtain service treatment records from the National Personnel Records Center. We have found that our clients need significant help and time to respond to the VCAA notice.

The commenter also expressed concern that proposed § 5.250(f) does not provide enough detail as to how a veteran will be “advised that evidence from sources other than the veterans service records may constitute credible supporting evidence.” The commenter noted that although the purpose of VA's Regulation Rewrite Project is to make VA regulations more logical, claimant-focused, and user-friendly, simply adopting 38 CFR 3.304(f)(5) “wastes an opportunity to provide more concrete explanation of the type of notice that will be provided to a veteran with PTSD secondary to MST.”

As a preliminary matter, we note that the procedures VA follows for requesting evidence from claimants is explained in proposed § 5.90 (based on current 38 CFR 3.159). These procedures apply to all claims, so it would be redundant to restate them in § 5.250. Regarding the commenter's suggestion that, for military sexual trauma claims, VA expand the time permitted to respond to VA requests for evidence, we note that the commenter is correct that the purpose of the Regulation Rewrite Project is to make VA's compensation and pension regulations more logical, claimant-focused, and user-friendly, not to serve as a vehicle for making major changes to VA policies. Thus, the comment is outside the scope of this rulemaking.

§ 5.251 Current Disabilities for Which VA Cannot Grant Service Connection.

When we initially proposed § 5.251 (see 75 FR 53744, Sept. 1, 2010), we failed to state in the preamble that proposed 5.251(c) would be new. It would incorporate and expand upon 38 CFR 4.127, which states, “Mental retardation and personality disorders are not diseases or injuries for compensation purposes, and, except as provided in § 3.310(a) of this chapter, disability resulting from them may not be service-connected. However, disability resulting from a mental disorder that is superimposed upon mental retardation or a personality disorder may be service-connected.” Proposed § 5.251(c) expands the principle to recognize that the preexistence or coexistence of disabilities for which VA cannot grant service connection does not preclude granting service connection for “superimposed” disabilities that independently meet the criteria for service connection.

B. Presumptions of Service Connection for Certain Disabilities, and Related Matters

In a document published in the Federal Register on July 27, 2004, we proposed to revise VA regulations governing presumptions of service connection for certain disabilities and related matters, to be published in new 38 CFR part 5. See 69 FR 44614. We provided a 60-day comment period that ended September 27, 2004. We received submissions from seven commenters: Disabled American Veterans, Paralyzed Veterans of America, Vietnam Veterans of America, and four members of the general public.

Undesignated Center Heading Before § 5.260

One commenter suggested that the proposed undesignated center heading before § 5.260 is inaccurate. As proposed, it read, “Presumptions of Service Connection for Certain Disabilities, and Related Matters.” The commenter suggested that the word “disabilities” should be replaced by the word “diseases” because the presumption of service connection attaches to the disease rather than the disability and because it conflicts with subsequent regulatory language using the word “disease”.

We agree with the commenter that it is appropriate to add “diseases” to the undesignated center heading; however, we would do so by inserting the word before the word “disabilities”, rather than by replacing that word. The proposed undesignated center heading was imprecise because it was under-inclusive; however, to change the undesignated center heading by replacing “disabilities” with “diseases” would also be under-inclusive because to simply refer in our regulations to “diseases” may not adequately identify to readers all of the medical conditions identified by the authorizing statutes. See, for example, 38 U.S.C. 1112 (titled “Presumptions relating to certain diseases and disabilities”); 38 U.S.C. Start Printed Page 711051112(b)(10) and (14) (providing benefits for a “disorder” and a “syndrome”); 38 U.S.C. 1117 (authorizing compensation for “qualifying chronic disabilit[ies]”); and 38 CFR 3.309(c) (including as presumptively service connectable “diseases”, psychosis, anxiety states, dysthymic disorder, and organic residuals of frostbite, which may not be generally understood by the public as “diseases”). It is important that our regulations clearly explain the various conditions to which a presumption applies, irrespective of whether current medical authorities classify a particular condition as a “disease”, Referring to “diseases, disabilities, and related matters” in our undesignated subheading will provide the most useful information to VA personnel and the public.

Thus, we propose to revise both the undesignated center heading and the regulations herein in accordance with the above discussion. For example, in § 5.261, we refer to “chronic diseases” because that is the term the statute uses and because the list comprises conditions that are commonly understood to be diseases. The sole exception might be a “brain hemorrhage”, but we do not believe that including that condition on the long list of “chronic diseases” will create confusion. On the other hand, in § 5.267(b), we provide a “list [of] diseases or injuries that VA will consider associated with full-body exposure to nitrogen mustard, sulfur mustard, or Lewisite” because that list contains several items that are more commonly understood to be injuries, such as corneal opacities and scar formation.

§ 5.260 General Rules Governing Presumptions of Service Connection

We propose to revise the heading of § 5.260 from “General rules and definitions” to “General rules governing presumptions of service connection.” This title is more precise and more descriptive.

We received two comments regarding § 5.260(a), a new provision that describes the purpose of presumptions of service connection. Both commenters agreed that the description of presumptions and how they operate in § 5.260(a) is accurate. However, both commenters suggested that VA add language to § 5.260(a) to clearly define the term “presumption”.

One commenter suggested supplementing the explanation of how a presumption operates with a legal definition of the term “presumption”, in order to make clear that presumptions are a rule of law that must be followed unless the presumption is sufficiently rebutted. The commenter suggested two definitions. The first is from Manning v. John Hancock Mut. Life Ins. Co., 100 U.S. 693, 697-98 (1879), which held that the existence of a fact may be presumed from the existence of other proven facts, so long as the presumed fact has an immediate connection or relation with the proven facts. The second definition suggested by the commenter is from “Black's Law Dictionary”, 1067 (5th ed. 1979), stating that a presumption is “a rule of law, statutory or judicial, by which finding of a basic fact gives rise to existence of presumed fact, until presumption is rebutted.”

After review, we propose not to define the term “presumption” in § 5.260(a). While both legal definitions of the term “presumption” suggested by the commenter are correct, we do not believe that regulation readers will be best served by a legal definition of the term “presumption” in § 5.260(a). Since the legal definition of a presumption is a clear concept in the law, it is not necessary to include such a definition to aid the courts in interpreting the term “presumption”. In addition, a legal definition of “presumption” in proposed § 5.260(a) would not well serve readers who may not be familiar with legal jargon in such a definition. With respect to the commenter's suggestion that VA must clarify that a presumption is a rule of law, we note that the mere existence of presumptions in both the statutes and in these regulations makes clear that these presumptions are in fact laws. With respect to the legal effect of a presumption, we have adequately explained the effect of the presumptions of service connection in proposed § 5.260(a).

Another commenter suggested that VA adopt the final sentence of § 3.303(d) as the first sentence of § 5.260(a), as it is a clear and succinct statement of the purpose of presumptions. The final sentence of § 3.303(d) reads: “The presumptive provisions of the statute and [VA] regulations implementing them are intended as liberalizations applicable when the evidence would not warrant service connection without their aid.”

We agree in part, and propose to add the following as the first sentence of § 5.260(a): “Presumptions of service connection apply when the evidence would not warrant service connection without their aid.” We do not mean to include the characterization of the presumptions as liberalizations because such a characterization is not helpful. Although it is true that presumptions of service connection allow veterans who might not be able to establish direct service connection to have their disease service connected, it is misleading to refer to them as liberalizations. The effect of a liberalizing law is provided for in § 5.152, and we do not want § 5.260(a) to confuse that section with the general law governing presumptions of service connection.

In addition, we determined that in initially proposed § 5.260, we failed to include the second sentence of 38 CFR 3.303(d), which states, “Presumptive periods are not intended to limit service connection to diseases so diagnosed when the evidence warrants direct service connection.” We propose to restate this provision more clearly by adding this sentence at the end of § 5.260(a), “VA will not use the existence of a presumptive period to deny service connection for a presumptive disease diagnosed after the presumptive period if direct evidence shows it was incurred or aggravated during service.”

After reviewing initially proposed § 5.260(b)(1), we propose to remove the parentheses from around the last sentence of the paragraph because they are unnecessary.

Initially proposed § 5.260(b)(2) discussed “competent lay evidence”, “lay evidence”, and “medical evidence”. In § 5.1 we have defined “competent lay evidence” and “competent expert evidence” (which includes medical evidence). Our intent in initially proposed paragraph (b)(2) was to refer to competent evidence. We therefore propose to insert the word competent before lay and medical throughout this paragraph. To ensure consistency we propose to make these same changes throughout part 5.

We propose to make a minor technical change to the language of § 5.260(c). The introductory text to § 5.260(c), as initially proposed, stated: “VA cannot grant service connection under this section when the presumption has been rebutted by the evidence of record.” 69 FR 44624, July 27, 2004. We propose to change the words “this section” in this sentence to “§§ 5.261, 5.262, 5.264 through 5.268, 5.270 and 5.271”.

In addition, we propose to change initially proposed § 5.260(c) based on comments objecting to our decision not to use the term “affirmative evidence” in the description of what kind of evidence may be used to rebut a presumption of service connection for a disease. Specifically, in § 5.260(c)(2) we stated that “[a]ny evidence competent to indicate the time a disease existed or started may rebut a presumption of service connection that would otherwise Start Printed Page 71106apply.” 69 FR 44614, July 27, 2004. Because 38 U.S.C. 1113(a) specifically requires “affirmative evidence” to rebut the “disease presumptions” set forth in chapter 11, title 38, United States Code, we propose to revise initially proposed § 5.260(c) to require affirmative evidence. In addition, we agree with several commenters who defined affirmative evidence as evidence that declares a fact positively and establishes that a particular disease does not warrant the award of presumptive service-connection. We propose to revise paragraph (c)(2) to define “affirmative evidence” as “evidence that supports the existence of a particular fact,” and to further state that affirmative evidence “does not mean the mere absence of evidence.”

However, some commenters asserted that under no circumstances may VA rebut a presumption based on the absence of evidence. A commenter stated that a medical opinion founded on the absence of symptoms is not “affirmative evidence”. Similarly, another commenter stated that a medical opinion used to rebut the presumption of service connection for a chronic disease may not be based on the length of time between service and clinical manifestation of the disease, because Congress chose a specific period for the presumption of service connection to apply for each disease. The commenter noted that in 38 U.S.C. 1112(a)(2), Congress provided for a presumptive period of “one year from the date of separation from such service, or at a time when standard or accepted treatises indicate that the incubation period thereof commenced during such service.” According to the commenter, because Congress did not provide this alternative for chronic diseases, pure medical judgments cannot override the presumptive period allotted by Congress.

We disagree with these comments in the following respect: To rebut a presumption that a presumptive disease was incurred during service or during the post-service presumptive period, affirmative evidence would have to show that the disease did not exist at such time. A medical opinion that establishes the date of onset of the disease determined by the use of fact-based medical evidence may serve as “affirmative evidence” regarding the onset or existence of that disease, even if the mere absence of symptoms or other evidence of disease is not. In other words, it is the medical professional's qualified opinion that serves as evidence to be considered by VA's adjudicator, not the lack of evidence in the claims file. Hence, we propose to revise § 5.260(c)(2) to state that “the absence of evidence may be a basis for affirmative evidence. For example, a medical professional may conclude that a disease or disability existed or started at a particular time based on an absence of evidence of signs or symptoms of the condition before that time.”

One commenter objected to the statement in proposed § 5.260(c) which states that once a presumption has been rebutted, VA can no longer grant presumptive service connection. The commenter believes the statement is not true in all cases, and suggests that if the veteran provides medical or lay evidence, it would be possible for the veteran to establish service connection on a presumptive basis. As an example, the commenter proposes a situation where VA reviews available medical records and finds the evidence rebuts the presumption of service connection because the veteran has not received a credible diagnosis of the disease for which he or she is claiming presumptive service connection. The commenter proposes that if the veteran later obtains a credible medical opinion diagnosing the veteran with the presumptive disease, the veteran should be entitled to presumptive service connection.

We propose not to make any changes based on this comment. In the hypothetical situation posed by the commenter, the absence of a credible diagnosis of the claimed disease does not serve to rebut the presumption of service connection. In that situation, the presumption never arose because the existence of the claimed condition is one of the underlying facts necessary to give rise to the presumption. If the veteran subsequently presents evidence sufficient to prove that he or she did in fact suffer from a disease for which VA may grant presumptive service connection, then the presumption will apply.

In any event, no scenario allows VA to grant presumptive service connection after the evidence rebuts the presumption. The commenter is correct that if VA rebuts the presumption of service connection for a disease, the veteran is entitled to bring forth evidence supporting service connection. However, service connection established in this manner is granted under 38 U.S.C. 1110 (generally referred to as “direct” service connection) and is not presumptive service connection. If the presumption of service connection is rebutted, a veteran may still establish service connection by filing evidence showing the onset of the disease in service, or by any other method provided by these regulations.

In NPRM AM07, we changed “symptomatology” to “signs or symptoms” consistent with current medical terminology. For consistency, we propose to do the same in § 5.260 and throughout part 5. In paragraph (b)(1), we propose to change “symptomatology” to “signs or symptoms”. In (b)(2), we propose to replace the phrase “physical findings and symptomatology” with “signs or symptoms”. The term “signs” is equivalent to “physical findings”. Moreover, we intend this rule to include mental as well as physical signs.

In initially proposed paragraph (c)(2), we stated, “For example, a medical professional may conclude that a disease or disability existed or started at a particular time based on an absence of evidence of symptoms of the condition.” We now propose to insert “signs or” before “symptoms”. We also propose to insert “before that time” at the end of the sentence to clarify when an absence of signs or symptoms is relevant.

In initially proposed § 5.260(a) and (c) we omitted reference to § 5.263, “Presumption of Service Connection for Non-Hodgkin's Lymphoma Based on Service in Vietnam”. In reviewing the presumption regulations to respond to comments, we have noted that there is no reason to exclude § 5.263 from these provisions. We recognize that 38 CFR 3.313 contains no rebuttal provision but we do not believe that an irrebuttable presumption would be consistent with title 38 to the extent it would authorize benefits for a disease shown by clear evidence to be unrelated to service or to be attributable to the veteran's willful misconduct. We therefore propose to include § 5.263 in paragraphs (a) and (c).

§ 5.261 Certain Chronic Diseases VA Presumes Are Service Connected

In reviewing the initially proposed regulation, we noted that we included the phrase, “from a qualifying period of service”, in § 5.261(a)(1), but not in § 5.261(a)(2). To ensure that readers are aware that the presumptions apply only after a period of qualifying service, we propose to revise § 5.261(a)(2) to include the phrase, “after a qualifying period of service”. In § 5.261(a)(1), we propose to change the term, “a year” to “1 year” to ensure consistency throughout our regulations.

In initially proposed § 5.261(c), based on current §§ 3.307(a)(2) and 3.308(a), we stated, “In claims based on service ending before December 7, 1941, for purpose of determining whether a chronic disease manifested within a presumptive period under this section, Start Printed Page 71107the date of separation from wartime service will be the date of discharge or release during a war period, or if service continued after the war, the end of the war period.” We have determined that this paragraph is erroneous because veterans whose service ended before that date get no presumption of service connection for chronic disease. Therefore, there can be no “date of separation from wartime service” for a pre-December 7, 1941 veteran “for the purpose of determining whether a chronic disease manifested within a presumptive period.” We therefore propose to remove paragraph (c) and redesignate the remaining paragraphs of § 5.261 accordingly.

One commenter suggested that VA include a statement clarifying that the chronic diseases listed in initially proposed § 5.261(d) (now (c)) are the only conditions that will be considered chronic. Currently, § 3.307(a) states that no condition other than one listed in § 3.309(a) will be considered chronic. In addition, 38 U.S.C. 1101(3) contains a list of chronic diseases and includes “such other chronic diseases as the Secretary may add to this list”, which strongly implies that the list should be considered exclusive absent action by the Secretary. The commenter believes that stating that the list of chronic diseases in § 5.261(d) is exclusive will prevent any misconception that VA has the ability to establish presumptive service connection for any disease which appears no later than 1 year after leaving service. The commenter concluded that nothing prevents VA from stating the list of chronic conditions in § 5.261(d) is exclusive.

We agree and propose to include the sentence, “Only conditions listed in this section are chronic for purposes of this section.” The commenter is correct that only the conditions listed in § 5.261(d) will be considered chronic for purposes of presumptive service connection under § 5.261.

One commenter suggested that for clarity, § 5.261(d) should use the words “acute and transitory” instead of simply using “acute”. The commenter states that the “acute and transitory” language is “consistent with long-standing VA parlance regarding how it adjudicates claims based on chronic conditions.” Although VA has previously used the term “acute and transitory” in decisions, it is not consistent with current VA terminology used in adjudicating claims based on chronic conditions. The word “transitory” is not found in any regulation in either part 3 or part 4 of title 38 CFR. Nor is it found in “Dorland's Illustrated Med. Dictionary” (31st ed. 2007). Moreover, “acute” and “transitory” both suggest brief duration, so that “transitory” does not add to the meaning of the rule. For these reasons, we propose to make no changes based on this comment.

Initially proposed § 5.261(d) is based on § 3.307(b) and contains an exclusive list of the diseases VA considers chronic for purpose of presumptive service connection. One commenter stated that this section would “authorize adjudicators to determine that a chronic disease which has manifested to a compensable degree and which is under consideration for service connection is not chronic.” The commenter stated that VA has no lawful authority to make an independent factual determination contrary to the command of 38 U.S.C. 1101(3), which lists chronic diseases for purposes of disability compensation.

However, 38 U.S.C. 1101(3) only defines what are considered to be chronic diseases; it does not contain any requirement that service connection be granted for the listed diseases. The requirement to grant presumptive service connection for chronic diseases is found in 38 U.S.C. 1112(a), which states that a chronic disease will be considered to have been incurred in or aggravated by such service. The authority to rebut a presumption of service connection is found at 38 U.S.C. 1113(a), which states that “where there is affirmative evidence to the contrary, or evidence to establish that intercurrent injury or disease . . . has been suffered . . . service-connection . . . will not be in order.” The wording in initially proposed § 5.261(c) is a restatement of the previous wording used in § 3.307(b), which states, “Unless the clinical picture is clear otherwise, consideration will be given as to whether an acute condition is an exacerbation of a chronic disease.” As initially proposed, § 5.261(d) restated this principle as, “Unless the clinical picture clearly shows the condition was only acute, VA will consider whether an acute condition was an exacerbation of a chronic disease.” Based on the comment, we understand that the proposed rule could be misunderstood to authorize VA to treat a chronic condition as if it were acute. Neither the statute nor the current regulation authorize such treatment, and we did not propose to create such authorization in § 5.261(d). Hence, we propose to revise the sentence so that it more closely follows the language of the current regulation.

We received four comments stating that our proposed rule regarding the presumption of service connection for aggravation of certain chronic diseases and diseases associated with exposure to certain herbicide agents in proposed §§ 5.261(d) and 5.262(e) is contrary to the holding of the U.S. Court of Appeals for the Federal Circuit in Splane v. West, 216 F.3d 1058 (Fed. Cir. 2000), and otherwise not in accordance with 38 U.S.C. 1112(a) and 1116(a). The comments asserted that the statutes do not limit the degree to which a pre-existing condition must be disabling prior to entry in order for the presumption of aggravation to apply; that the statute does not provide that a disease must “first” become manifest during the presumptive period; and that 38 U.S.C. 1112(a) and 1116(a) should be interpreted to provide a presumption of aggravation of the listed diseases if the degree of disability increases by any degree during the applicable presumptive period (for example, from 20 percent disabling to 30 percent disabling).

Additionally, a commenter suggested that the treatment of preexisting conditions under 38 U.S.C. 1112(a) and 1116(a) conflicts with the treatment of preexisting conditions under 38 U.S.C. 1153, the general presumption of aggravation. Commenters asserted that VA could not arbitrarily apply different rules to veterans who had preexisting disabilities that were aggravated by service than to veterans who had no preexisting disabilities. One commenter suggested that the only difference is the “formality” that the underlying pathology had its inception prior to service rather than during service.

By way of background, 38 U.S.C. 1153 provides a presumption that “[a] preexisting injury or disease will be considered to have been aggravated by active military . . . service, where there is an increase in disability during such service.” The presumptions at issue in proposed §§ 5.261 and 5.262, however, are based on 38 U.S.C. 1112(a) and 1116(a), which provide a presumption for conditions that manifest to a degree of disability of 10 percent or more during a specified period of time after service.

In the Splane case, the Federal Circuit examined whether the post-service presumptive period in 38 U.S.C. 1112(a) could cover a preexisting condition. The Federal Circuit held that the words “or aggravated by” in paragraph (a) required application of the presumption of aggravation of a chronic disease to a veteran whose chronic disease existed but was not compensable prior to service, regardless of VA's “not altogether unpersuasive” argument that those words were a vestige of an earlier provision that was long ago rendered obsolete. Splane, 216 F.3d at 1069. The court found it “unreasonable to assume Start Printed Page 71108that Congress did not anticipate the possibility that a veteran, who had nonsymptomatic M[ultiple] S[clerosis] before service, might be exposed to such aggravating conditions during service that he would become disabled to a compensable degree after service.” Id.

Our proposed part 5 regulations specifically accounted for this possibility by presuming that a chronic disease or a disease associated with herbicide exposure is presumed to have been aggravated during service if the disease manifests to a compensable degree within the applicable presumptive period. Proposed § 5.261(d) stated that VA cannot presume service connection when the evidence shows that the disease existed prior to military service to a degree of 10 percent or more disabling.

Section 5.262(e) used nearly identical language. We explained our rationale in the NPRM, as follows:

The Federal Circuit held that the words “or aggravated by” indicate that Congress meant section 1112(a) to apply to those situations where multiple sclerosis predated entry into the service and became disabling to a compensable degree within the presumptive period following service. The “or aggravated by” language also appears in 38 U.S.C. 1116(a)(1)(B), which provides the authority for the presumptions based on herbicide exposure. Therefore, we propose to add language to clarify that presumptions may apply to a listed disease that preexisted service but first became manifest to a degree of 10 percent or more within the presumptive period following service.

69 FR 44620, July 27, 2004.

Limiting §§ 5.261 and 5.262 presumptions to situations where the condition was not manifest to a degree of 10 percent or more disabling before service is not arbitrary, unfair, or beyond VA's statutory authority. Under 38 U.S.C. 1112(a)(1), VA must presume service connected “a chronic disease becoming manifest to a degree of 10 percent or more disabling within one year from the date of separation from . . . service,” and 38 U.S.C. 1116(a) similarly creates a presumption based on manifestation of a disease to a degree of 10 percent or more disabling within the presumptive period. Use of a 10 percent threshold would not make sense if a preexisting disease manifest to a degree of 10 percent or more disabling prior to service could trigger the presumption because the disease would already have reached the threshold before service. If Congress had intended to also presume aggravation for a veteran who already had a disease manifest to a compensable degree prior to service, the law could have been written to presume service connection for a disease that “worsens by 10 percent or more,” rather than one that “becom[es] manifest” to such a degree. Finally, we note that most of the diseases that are considered chronic are diseases that, had they been symptomatic prior to service, would have likely rendered the person ineligible for service. In fact, several of the conditions are so disabling that their symptoms cannot even be rated as merely 10 percent disabling. For example, the first signs of multiple sclerosis are rated at 30 percent under 38 CFR 4.124a, Diagnostic Code 8018. It is unlikely that VA will receive claims from persons who were compensably disabled before service, and our experience has not shown this to be a problem under the current regulations.

Lastly, we note that the Splane court did not address the type of case described by the commenters: where a disability was already manifest to a degree of disability of 10 percent or more prior to service. The commenters urge VA to adopt an interpretation of 38 U.S.C. 1112 far beyond that which the Splane court provided. For the reasons stated above, we propose to make no changes based on these comments.

One commenter also had a comment related to the following sentence in the NPRM:

We note that if the condition preexisted service to a degree of 10 percent, for example, and after service the condition was 20 percent disabling, the veteran may be able to establish service connection using the presumption of aggravation in 38 U.S.C. 1153.

69 FR 44620, July 27, 2004.

The commenter noted that 38 U.S.C. 1153 only applies to increases in disability during service. Therefore, this statement would not be correct with respect to increases in disability within the presumptive period. The commenter is correct that 38 U.S.C. 1153 only applies to aggravation during service. We clarify this statement by noting that when we said “after service”, we meant immediately after service.

The commenter stated that in some cases, VA would presume that a disease in a state of remission or inactivity was disabling to a degree of 10 percent at entry, while a draft rule for service connection indicates that VA would deny service connection for lack of current disability if a disease was in remission. The commenter objects to this dual standard for cases when diseases are in remission.

We propose to make no changes based on this comment. The provision the commenter discussed from the draft rule for service connection does not address this situation since that concerns direct service connection and not establishment of service connection through the use of the presumptions. Additionally, if there is no current disability, service connection cannot be established. Also, Congress in 38 U.S.C. 1112, mandated that the disease must manifest to a degree of 10 percent or more disabling before VA may presume service connection. A disease that is in remission and is not manifest to a degree of 10 percent or more disabling may not be service connected under the presumptions of service connection provisions.

§ 5.262 Presumption of Service Connection for Diseases Associated With Exposure to Certain Herbicide Agents

In our initially proposed regulations on presumptions of service connection, we changed the wording found in §§ 3.307(a) and 3.317(c)(3), “. . . [certain diseases] will be considered to have been incurred in or aggravated by service . . .” to “VA will presume service connection [for certain diseases] . . .” We proposed this language in several part 5 regulations: §§ 5.262(a)(2), 5.264(b) and (c), 5.265(a) and (d), 5.267(a), and 5.268(b). This attempt to use simpler language resulted in a technical error because under its authorizing statutes, VA service connects disability or death, not injury or disease per se. We therefore propose to correct these sections to reflect that the diseases listed will be considered to have been incurred in or aggravated by service.

We received four comments regarding the proposed definition of “Service in the Republic of Vietnam” in § 5.262(a)(1) for purposes of the presumption of service connection for diseases associated with exposure to certain herbicide agents. As proposed, § 5.262(a)(1) stated:

For purposes of this section, “Service in the Republic of Vietnam” does not include active military service in the waters offshore and service in other locations, but does include any such service in which the veteran had duty in or visited in the Republic of Vietnam, which includes service on the inland waterways.

69 FR 44626, July 27, 2004.

Three commenters objected to the exclusion of service in the waters offshore Vietnam in the definition of “Service in the Republic of Vietnam” for purposes of § 5.262. One commenter stated that when Congress refers to a country by its name in a statute, it is referring to the entire country, including the entire area over which a country has Start Printed Page 71109sovereignty. This would, under the 1982 United Nations Convention on the Law of the Sea, 21 I.L.M. 1261, include the territorial sea which extends up to twelve miles beyond the land territory of Vietnam. All three commenters support this proposition with an example of the service required to receive the Vietnam Service Medal. Executive Order 11231, July 8, 1965, provides that the “Vietnam Service Medal shall be awarded to members of the armed forces who serve in Vietnam or contiguous waters or air space”. The commenters believe that the definition of “Service in the Republic of Vietnam” provided in § 5.262(a)(1) is contrary to the ordinary and common meaning of the phrase. Therefore, the commenters believe there is no reason to believe that Congress intended to exclude the territorial sea when it drafted 38 U.S.C. 1116.

We propose to make no changes based on these comments. These comments are adequately addressed by Haas v. Peake, 425 F.3d 1168 (Fed. Cir. 2008); the notice proposing to rescind, and the notice actually rescinding, the VA manual provision cited in Haas, 72 FR 66218, Nov. 27, 2007 and 73 FR 20363-65, Apr. 15, 2008; and the proposed revision to 38 CFR 3.307(a)(6)(iii), 73 FR 20566-71, Apr. 16, 2008 (withdrawn by 74 FR 48689, Sept. 24, 2009). We incorporate by reference the rationales set forth therein, and do not reiterate them here.

However, we do propose to revise initially proposed § 5.262(a)(1) so that it more clearly conveys the requirement that the veteran have served “on land, or on an inland waterway, in the Republic of Vietnam.”

On May 7, 2009, VA published Final Rule RIN 2900-AN01, “Presumptive Service Connection for Disease Associated With Exposure to Certain Herbicide Agents: AL Amyloidosis”, which stated the Secretary's determination of “a positive association between exposure to herbicide agents and the occurrence of AL amyloidosis” and added that disease to 38 CFR 3.309(e). 74 FR 21258. Therefore, we now propose to include AL amyloidosis in § 5.262(e) in accordance with the Secretary's finding.

On August 31, 2010, VA published RIN 2900-AN54, “Diseases Associated With Exposure to Certain Herbicide Agents (Hairy Cell Leukemia and Other Chronic B-Cell Leukemias, Parkinson's Disease and Ischemic Heart Disease)” which stated the Secretary's determination of “a positive association between exposure to herbicide agents and the occurrence of those diseases” and added those diseases to 38 CFR 3.309(e). 75 FR 53202. Therefore, we now propose to include them in § 5.262(e) in accordance with the Secretary's finding.

We propose to change the term “acute and subacute peripheral neuropathy” in § 5.262 and instead use the term “early-onset peripheral neuropathy”. Additionally, we have removed note \1\ which provided that peripheral neuropathy must resolve within 2 years of onset. This conforms to changes made in part 3. 78 FR 54763, Sept. 6, 2013.

§ 5.263 Presumption of Service Connection for Non-Hodgkin's Lymphoma Based on Service in Vietnam

One commenter believed that proposed § 5.263, which was based on § 3.313 with minor changes, was unnecessary. Proposed § 5.263 provides for presumptive service connection for non-Hodgkin's lymphoma based on service in Vietnam. The commenter asserted that anyone eligible for presumptive service connection under § 5.263 would also be eligible for presumptive service connection under § 5.262 and it is therefore unnecessary to have § 5.263.

We propose to make no changes based on this comment. We agree with the commenter that many of the veterans entitled to presumptive service connection under § 5.263 may also be entitled to presumptive service connection under § 5.262. However, there are differences between §§ 5.262 and 5.263 that require two separate rules. Therefore, we propose to retain § 5.263 in our final rule. One difference is in the definition of what constitutes “service in Vietnam”. See VA General Counsel's Opinion, VAOPGCPREC 27-97, 62 FR 63604 (Dec. 1, 1997). Specifically, the definition of “service in Vietnam” in § 5.263 includes service in the waters offshore Vietnam, whereas the definition in § 5.262 specifically excludes such service from the definition of “service in the Republic of Vietnam”. Another difference is that § 5.262 provides for determining presumptive exposure to herbicides due to service in the Republic of Vietnam while § 5.263 provides for service connection for non-Hodgkin's lymphoma without regard to possible exposure to herbicides in the Republic of Vietnam.

§ 5.264 Diseases VA Presumes Are Service Connected in a Former Prisoner of War

On June 30, 2006, VA published in the Federal Register an addition to § 5.264, “Diseases VA presumes are service connected in former prisoners of war”, adding atherosclerotic heart disease or hypertensive vascular disease (including hypertensive heart disease) and their complications (including myocardial infarction, congestive heart failure, and arrhythmia) and stroke and its complications to the diseases VA presumes are service connected in former prisoners of war. 71 FR 37793, June 30, 2006. No comments were received concerning this addition. Proposed § 5.264 is revised from the version published in the NPRM, by adding these conditions to the list of diseases. 69 FR 44614, July 27, 2004.

Section 106 of Public Law 110-389, 122 Stat. 4145, 4149 (2008), amended 38 U.S.C. 1112(b)(2) by adding a new subparagraph (F) that creates a presumption of service connection for osteoporosis that becomes manifest to a degree of 10 percent for prisoners of war (POWs) if the Secretary determines that the veteran has posttraumatic stress disorder (PTSD). On August 28, 2009, VA published an amendment in the Federal Register to § 3.309(c), applying Public Law 110-389. 74 FR 44288. This amendment also implements a decision by the Secretary to establish a presumption of service connection for osteoporosis that becomes manifest to a degree of 10 percent for POWs if the veteran was interned for more than 30 days. This presumption is based on scientific studies. These changes have been incorporated into proposed § 5.264(b) and (c).

§ 5.265 Tropical Diseases VA Presumes Are Service Connected

In initially proposed § 5.265(d), we stated, “For any disease service connected under this section, VA will also service connect the resultant disorders or diseases originating because of therapy administered in connection with such a disease or as a preventative measure against such a disease.” We have determined that this sentence is redundant of the basic rule on secondary service connection contained in § 5.246, “Secondary service connection—disabilities that are due to or the result of service-connected injury or disease.” Therefore, we propose to remove this sentence from § 5.265(d).

One commenter suggested a minor clarifying change to § 5.265(e). The commenter suggested revising the sentence stating that “Residence during the applicable presumptive period where the particular disease is endemic may also be considered evidence to rebut the presumption”, to refer to “post-service” residence. The commenter recognized that this addition would be redundant (because the presumptive period is post-service), but Start Printed Page 71110opined that it would nevertheless make the rule clearer for the average lay person. We agree that, while redundant, this minor change could be beneficial to readers. Therefore, we propose to change § 5.265(e) to refer to “[p]ost-service residence”.

One commenter objected to the requirement in § 5.265(f) that would require a tropical disease to manifest to a degree of 10 percent or more disabling within the presumptive period in order for the disease to be presumptively service connected. The commenter noted that the statutory authorization for this presumption, 38 U.S.C. 1133, provides no minimum degree of manifestation for the presumption of service connection to apply for veterans with peacetime service before January 1, 1947. The commenter is correct. We propose to revise § 5.265(f) so that it no longer contains the 10 percent requirement.

Moreover, we discovered that we mistakenly used the term “existed”, rather than “manifested”, in initially proposed § 5.265(f). This language was taken from 38 CFR 3.308(b), but it does not appear in any other presumption regulation in part 5. Therefore, in order to ensure consistency with the other presumption regulations in part 5, we propose to replace “existed” with “manifested”.

We also propose to change the term “accepted medical treatises” to “accepted medical literature” throughout this section because “treatise” is a specific type of scholarly literature, specifically “a systematic exposition or argument in writing including methodical discussion of the facts and principles involved and conclusions reached.” “Merriam-Webster's Collegiate Dictionary” 1258 (10th ed. 1998). “Accepted medical literature” is a broader class of literature, sufficiently authoritative and more accessible to claimants than are “treatises”. We propose to make the same change in § 5.266, Disability compensation for certain qualifying chronic disabilities.

§ 5.266 Disability Compensation for Certain Qualifying Chronic Disabilities

We propose to reorganize and make technical corrections to initially proposed § 5.266. We would reorganize this section as follows. Initially proposed paragraph (a) stated that VA will compensate veterans for a qualifying chronic disability and defined that term. Initially proposed paragraphs (b) and (c) defined undiagnosed illness and medically unexplained chronic multisymptom illness, respectively. Paragraph (f) would contain the general definitions that apply to all types of qualifying chronic disabilities.

We propose to move initially proposed paragraph (a)(1)(ii), which stated, “By history, physical examination, and laboratory tests cannot be attributed to any known clinical diagnosis.” This paragraph would apply only to undiagnosed illnesses, not to other qualifying chronic disabilities, so we propose to move it into new paragraph (b), which would describe undiagnosed illnesses.

For purposes of accuracy, we propose to change the title of the regulation from “Compensation for certain disabilities due to undiagnosed illnesses” to “Disability compensation for certain qualifying chronic disabilities”.

Since publication of the AL70 NPRM, VA published a Final Rule VA that made technical revisions to 38 CFR 3.317 to clarify that adjudicators have the authority to determine whether diseases in addition to the three listed in 38 U.S.C. 1117 qualify as medically unexplained chronic multisymptom illnesses in addition to the three that are listed in 38 U.S.C. 1117. 75 FR 61995, Oct. 7, 2010. VA subsequently published a final rule that replaced “irritable bowel syndrome” with “functional gastrointestinal disorders”. 76 FR 41696, Jul. 15, 2011. We propose to incorporate these regulatory amendments into § 5.266.

Current 38 CFR 3.317(c) describes situations in which the presumptions in that section will be considered rebutted. We note that § 3.307(d) (the basis for initially proposed § 5.260(c)) already contains this same rebuttal information as it applies to the various presumptions listed in § 3.309, but not to § 3.317. We now propose to expand the scope of § 5.260(c) to include § 5.266 and 5.271. To avoid duplication, we propose to exclude the duplicate provisions from § 5.266 and 5.271.

§ 5.267 Presumption of Service Connection for Conditions Associated With Full-Body Exposure to Nitrogen Mustard, Sulfur Mustard, or Lewisite

One commenter asserted that the proposed rule would have changed the current rule, § 3.316, which the commenter said requires direct service connection for exposure to mustard gas and Lewisite, to a rule that would establish presumptive service connection based on such exposure. The commenter questioned whether VA has the authority to create a new class of presumptive conditions. The commenter stated that the wording of proposed § 5.267(a) should be amended to provide for direct service connection, rather than presumptive service connection.

The commenter is incorrect that VA grants direct service connection under § 3.316. Although the regulation text does not explicitly state so, § 3.316 grants presumptive service connection and not direct service connection. The regulation presumes a medical nexus between full-body exposure to mustard gas or Lewisite and the listed diseases, thereby establishing a presumption as described in § 5.260(a).

We also note that our authority to create presumptions is explicitly set forth in 38 U.S.C. 501(a)(1), under which the Secretary may prescribe “regulations with respect to the nature and extent of proof and evidence . . . in order to establish the right to benefits”. As we noted in the preamble to the NPRM, the Secretary exercised this authority when he first promulgated § 3.316. 69 FR 44614, July 27, 2004.

We propose to revise the sentence preceding the table in § 5.267(b) so it is a complete sentence instead of a phrase and so it is consistent with other table introductions used in this regulation. We also propose to change “condition” in paragraph (a)(2) to “injury or disease” to be consistent with paragraph (b). In the table, we propose to change “disease or disability” to “injury or disease” for the same reason.

§ 5.268 Presumption of Service Connection for Diseases Associated With Exposure to Ionizing Radiation

In initially proposed § 5.268 we inadvertently failed to include the provisions of current 38 CFR 3.309(d)(3)(ii)(E). We propose to correct this omission by inserting § 5.268(c)(6), which is virtually identical to current § 3.309(d)(3)(ii)(E).

§ 5.269 Direct Service Connection for Diseases Associated With Exposure to Ionizing Radiation

In reviewing the comment received regarding this section, we have determined that both 38 CFR 3.311 and initially proposed § 5.269 use several different terms interchangeably or inconsistently. For example they refer to dose estimates as “dose assessments,” “dose information,” and “dose data”. We propose to remedy this problem by using the phrase “dose assessment” throughout § 5.269.

In initially proposed § 5.269(c)(3), we stated, “Neither the veteran nor the veteran's survivors may be required to produce evidence substantiating exposure if the information in the veteran's service records or other records maintained by the Department of Defense is consistent with the claim Start Printed Page 71111that the veteran was present where and when the claimed exposure occurred.” Current § 3.311(a)(4) actually limits the scope of this provision to only “cases described in paragraph (a)(2)(i) and (ii) of this section” (those involving atmospheric nuclear weapons test participation and Hiroshima and Nagasaki occupation). We inadvertently omitted this scope limitation in the initially proposed rule and we not propose to insert it in § 5.269(c)(3).

In initially proposed § 5.269(b), we omitted, without explanation, a number of cancers listed in current 38 CFR 3.311(b)(2): thyroid cancer; breast cancer; lung cancer; liver cancer; skin cancer; esophageal cancer; stomach cancer; colon cancer; pancreatic cancer; kidney cancer; urinary bladder cancer; salivary gland cancer; multiple myeloma; ovarian cancer; cancer of the rectum; and prostate cancer. We omitted these because they are subsumed within the meaning of the phrase, “Cancer (any other not listed)” in initially proposed paragraph (b)(2) (based on the phrase, “Any other cancer” in current § 3.311(b)(2)(xxiv)). We provide this explanation now, to assure the public that the fact that these cancers are not specifically referenced in the part 5 rule does not represent VA's intent to alter the applicability of the presumption that the diseases in some cases were caused by exposure to ionizing radiation.

In initially proposed paragraph (c)(5)(iii) (now redesignated as (d)(2)(iii)) we referred to an estimated dose of “zero rem gamma”. The word “gamma” is not in § 3.311 and we propose to remove it because it would improperly narrow the scope of this paragraph.

In initially proposed paragraph (d)(1) (now redesignated as paragraph (c)(1)(iii)), we stated, “If neither the Department of Defense nor any other source provides VA with records adequate to permit the Under Secretary to prepare a dose estimate, then VA will ask the Department of Defense to provide a dose estimate.” We stated in the preamble that this provision would reflect the fact that it is impossible to estimate the likelihood that ionizing radiation exposure caused a claimed condition in the absence of a numerical ionizing radiation dose estimate and that VA would be unable to prepare a dose estimate if it has not received any records on which to base such an estimate.

Upon review of this provision, we have determined that it does not accurately reflect VA's procedures in such cases. Moreover, it would be impracticable to request dose assessments from the Department of Defense (DoD) in these cases. This is because if DoD lacked records adequate to permit the Under Secretary for Health to prepare a dose assessment, then presumably DoD would likewise be unable to do so. For this reason, we propose to remove this provision.

In initially proposed paragraph (f), now redesignated as paragraph (g), we stated, “With regard to any issue material to consideration of a claim, the provisions of § 3.102 of this title apply (any reasonable doubt on any issue will be resolved in favor of the claimant).” In proposed § 5.3, we state, “When the evidence is in equipoise regarding a particular fact or issue, VA will give the benefit of the doubt to the claimant and the fact or issue will be resolved in the claimant's favor.” Since this provision applies to all VA claims, there is no need to repeat it in this paragraph and so we propose to remove it.

We received one comment stating that part of initially proposed § 5.269(g), now redesignated as paragraph (h), is unnecessary. The commenter believes that there is no danger of service connection being established for a disease due to radiation exposure if the disease is due to the abuse of alcohol or drugs. The commenter believes that since § 5.269 requires competent evidence and a decision by the Under Secretary of Benefits that it is at least as likely as not that the veteran's disease resulted from ionizing radiation in service, a disease due to the abuse of alcohol or drugs could not possibly be service connected under § 5.269.

We agree that the language regarding abuse of alcohol or drugs is unnecessary in § 5.269(h) and propose to remove it. Section 5.662, “Alcohol and drug abuse”, already bars an award of service connection for disabilities resulting from such abuse. For the same reason, we propose to remove such language from § 5.266(c)(3).

In initially proposed § 5.269(g), now redesignated as paragraph (h), we referred to “a supervening, nonservice-related condition or event [that] is more likely the cause of the disease” but failed to say more likely than what. We propose to clarify this by adding “than was exposure to ionizing radiation in service” so that the sentence will read: “In no case will service connection be established if evidence establishes that a supervening condition or event unrelated to service is more likely the cause of the disease than was exposure to ionizing radiation in service.”

In addition to the changes described above, we also propose to make minor changes in format and wording for clarity and readability.

§ 5.270 Presumption of Service Connection for Amyotrophic Lateral Sclerosis

Since publication of the AL70 NPRM, VA published a Final Rule creating a presumption of service connection for amyotrophic lateral sclerosis, which was codified as 38 CFR 3.318. 73 FR 54693, Sept. 23, 2008. We propose to add the text of § 3.318 as new § 5.270, with one revision: rather than restate the rebuttal standards already contained in § 5.260(c), we simply referenced that paragraph.

§ 5.271 Presumption of Service Connection for Infectious Diseases

Since publication of the AL70 NPRM, VA published a final rule creating presumptions of service connection for nine infectious diseases, which was codified as 38 CFR 3.317.75 FR 59968, Sept. 29, 2010. Infectious diseases are not actually within the definition of “qualifying chronic disability,” which is the purported subject of the regulation. Removing those provisions to a separate section will make the rules easier to comprehend and follow. We propose to incorporate these regulatory amendments into § 5.271.

Omission of § 3.379, Anterior Poliomyelitis, From Part 5

We received two comments relating to the initial proposal in the NPRM not to repeat § 3.379 in part 5. This section concerned service connection of the disease anterior poliomyelitis. One commenter agreed with the proposal. Another commenter disagreed with both the proposal and VA's rationale for removing it.

We proposed not to include § 3.379 because it is unnecessary in light of the operation of proposed § 5.261 regarding the presumption of service connection for chronic diseases. 69 FR 44623, July 27, 2004. Congress specified myelitis as a chronic disease under 38 U.S.C. 1101(3), and anterior poliomyelitis is a subcategory of myelitis. The general rules of presumptive service connection for chronic diseases under § 5.261 would apply to anterior poliomyelitis and any veteran who would be service connected under § 3.379 would also be service connected under § 5.261. Therefore, we concluded that § 3.379 was unnecessary and we proposed not to include it in part 5. We propose to make no changes based on these comments.

One commenter stated that it is not proper to apply the general presumption of service connection to poliomyelitis without taking into account the known medical facts, specifically, that Start Printed Page 71112poliomyelitis is a disease for which the exact cause and date of onset can be ascertained.

The commenter also detailed the three possible outcomes of a poliomyelitis infection. First, there is nonparalytic poliomyelitis, which is an acute illness, which resolves with no chronic or permanently disabling residuals. Nonparalytic poliomyelitis may properly be denied service connection on that basis. Second, there is paralytic poliomyelitis. The commenter notes that the date of the antecedent illness for paralytic poliomyelitis is crucial. If it occurs no later than 35 days after separation from service, it must have occurred in service, but if it occurs more than 35 days after separation from service, it must have occurred after service (therefore rebutting the presumption of service connection). Finally, there is paralytic poliomyelitis without apparent antecedent illness. In this case, it is a matter for medical determination and opinion as to the most probable date of exposure. If the medical evidence is inconclusive, then the presumption of service connection for myelitis should apply.

We propose to make no changes based on this comment. The general rule for presumption of service connection for chronic diseases in § 5.261 would provide accurate results for all the situations the commenter described, including rebuttal by medical evidence of the type the commenter described.

First, regarding nonparalytic poliomyelitis, because this disease cannot possibly be 10 percent or more disabling, the presumption of service connection under § 5.261 cannot apply in these cases.

Second, regarding paralytic poliomyelitis, direct service connection may be established in the majority of cases based on medical knowledge that the illness occurs no later than 35 days after exposure. Where direct service connection is denied based on the fact that the illness occurred more than 35 days after separation from service, the presumption of § 5.261 will be considered. However, the presumption of service connection will be rebutted under the provisions of § 5.260(c)(1)(iii) because there will be a preponderance of evidence (based on fact-based medical evidence and the date symptoms first occurred) establishing that the disease was not incurred in service.

Finally, with respect to paralytic poliomyelitis without apparent antecedent illness as described by the commenter, where direct service connection is not in order, VA will consider the presumption of service connection for myelitis as a chronic disease. However, the Centers for Disease Control and Prevention reports that all forms of poliomyelitis have an incubation period of 3 to 35 days, so a fact-based medical opinion would be needed to establish the approximate date of onset. Poliomyelitis, Centers for Disease Control and Prevention 232, Poliomyelitis, http://www.cdc.gov/​vaccines/​pubs/​pinkbook/​downloads/​polio.pdf, last viewed Sept. 15, 2009.

Technical Corrections

One commenter noted that in one part of the NPRM preamble, we “reserved” § 5.263, but elsewhere in the NPRM we proposed to repeat § 3.313 as § 5.263. The commenter felt that this was confusing. This was an error that we now propose to correct. We propose to create a new § 5.263 that has the same wording as § 3.313, except for the changes discussed in the preamble of the NPRM. We have corrected this in this proposed rule.

C. Rating Service-Connected Disabilities

§ 5.280 General Rating Principles

Initially proposed § 5.280(b)(1), based on 38 CFR 3.321, stated that for extra- schedular ratings in unusual cases that to accord justice to the exceptional case where the Veterans Service Center (VSC) finds the schedular ratings to be inadequate, the Under Secretary for Benefits or the Director of the Compensation and Pension Service, upon VSC submission, is authorized to approve an extraschedular rating commensurate with the average impairment of earning capacity due exclusively to the service-connected disability or disabilities. Paragraph (b)(1) also stated that the governing norm in these exceptional cases is a finding that the application of the regular schedular standards is impractical because the case presents an exceptional or unusual disability picture with such related factors as marked interference with employment, or frequent periods of hospitalization.

One commenter suggested that to avoid injustice in a case where the VSC improperly fails to find that the schedular rating is inadequate, VA should revise § 5.280(b)(1) to read:

To accord justice to the exceptional case, the Under Secretary for Benefits or the Director of the Compensation and Pension Service, is authorized to approve on the basis of the criteria set forth in this paragraph, an extra-schedular rating commensurate with the average impairment of earning capacity due exclusively to the service-connected disability or disabilities.

The commenter asserted that this suggested language is consistent with Colayong v. West, 12 Vet. App. 524, 536-37 (1999) and Young v. Shinseki, 22 Vet. App. 461, 470 (2009), which state that whether or not the VSC has, in the first instance, found the schedular rating to be inadequate, if it is inadequate it must be referred for an extra-schedular rating.

We note that the language of initially proposed 5.280(b)(1) was not substantively different from current § 3.321(b)(1), the regulation which was the basis for the courts' rulings in Colayong and Young. Those cases left undisturbed the requirement in § 3.321(b)(1) that extra-schedular review may be undertaken by the Under Secretary for Benefits or the Director, Compensation and Pension Service, only “upon field station submission”. Rather, those cases held that the Board of Veterans' Appeals (Board) must adjudicate the issue of entitlement to an extraschedular evaluation, if the issue is raised by the evidence of record or by the appellant.

We do not believe it is necessary to incorporate this line of cases into part 5. Since the Colayong case was decided in 1999, the Board has been under the duty set out by the court and the Board's Veterans Law Judges are now well aware of this duty. Moreover, it would be outside the scope of part 5 to impose a duty on the Board via a part 5 regulation. We therefore propose to make no change based on this comment.

In reviewing proposed § 5.280 to respond to this comment, we have noted that it contains language (substantively the same as § 3.321(b)) that might confuse a reader. Specifically, proposed § 5.280(b)(1) stated, “To accord justice to the exceptional case where the [VA] finds the schedular ratings to be inadequate, the [VA] is authorized to approve on the basis of the criteria set forth in this paragraph (b) an extra-schedular rating commensurate with the average impairment of earning capacity due exclusively to the service-connected disability or disabilities.” The use of the plural “disabilities” might be misconstrued as allowing VA to approve an extra-schedular rating based partly on a disability for which the schedular rating is inadequate and partly on a disability for which the schedular rating is adequate, or to suggest that under § 5.280 VA must consider the combined effect of multiple disabilities in determining whether an extra-schedular award is appropriate.

VA never intended that § 3.321, nor initially proposed § 5.280, apply in either of those ways but rather that they be applied individually to each specific disability being evaluated. Therefore, we propose to use only the singular Start Printed Page 71113form of “disability”, and to replace the word “case” with “disability” in the second sentence of § 5.280(b)(1), to clarify this point. We also propose several other, non-substantive changes to improve readability of paragraph (b)(1).

§ 5.281 Multiple 0 Percent Service-Connected Disabilities

Initially proposed § 5.281 stated:

VA may assign a 10 percent combined rating to a veteran with two or more permanent service-connected disabilities that are each rated as 0 percent disabling under the Schedule for Rating Disabilities in part 4 of this chapter, if the combined effect of such disabilities interferes with normal employability. VA cannot assign this 10 percent rating if the veteran has any other compensable rating.

One commenter suggested that for clarity, the second word in this section should be changed from “may” to “shall” to emphasize the mandatory nature of assigning the combined rating. We agree with this suggestion but we use “will” instead of “shall” throughout part 5 because the former is easier for the public to understand. We therefore propose to change “may” to “will” in § 5.281.

§ 5.282 Special Consideration for Paired Organs and Extremities

Initially proposed § 5.282(c) stated that, “If a veteran receives money or property of value in a judgment, settlement, or compromise from a cause of action for a qualifying nonservice-connected disability involving an organ or extremity described in paragraph (b) of this section, VA will offset the value of such judgment, settlement, or compromise against the increased disability compensation payable under this section.”

One commenter suggested that because the VA Schedule for Rating Disabilities does not provide compensation for non-economic loss, such as pain and suffering and loss of enjoyment of life, initially proposed § 5.282(c)(2) should calculate the offset of damages by first reducing the total amount recovered as damages by the amount received for pain and suffering and loss of enjoyment of life. The commenter also suggested that the amount paid for attorney fees and expenses for that recovery should be subtracted from the total amount recovered as damages.

The relevant statute, 38 U.S.C. 1151 does not allow VA to reduce the offset for any reason. Moreover, the purpose of the Regulation Rewrite Project is to make VA's compensation and pension regulations more logical, claimant-focused, and user-friendly, not to serve as a vehicle for making major changes to VA policies. Thus, the comment is outside the scope of this rulemaking.

§ 5.283 Total and Permanent Total Ratings and Unemployability

Initially proposed § 5.283(b) stated that, “VA will consider a total disability to be permanent when an impairment of mind or body, that makes it impossible for the average person to follow a substantially gainful occupation, is reasonably certain to continue throughout the life of the disabled person.”

One commenter asserted that it is inconsistent for VA to provide that total disability is permanent only if it is reasonably certain to continue throughout the lifetime of the veteran when the Social Security Administration considers a total disability to be permanent if it is likely to continue for 1 year or lead to death. The commenter asserted that veterans should not have a higher threshold for permanency than Social Security Disability recipients.

The purpose of the Regulation Rewrite Project is to make VA's compensation and pension regulations more logical, claimant-focused, and user-friendly, not to serve as a vehicle for making major changes to VA policies. Thus, the comment is outside the scope of this rulemaking.

§ 5.300 Establishing Dependency of a Parent

In initially proposed § 5.300(b)(2)(ii), we stated, “Net worth of a minor family member will be considered income of the parent only if it is actually available to the veteran's parent for the minor's support.” This statement was erroneous and inconsistent with § 3.250(b)(2). In fact, a minor's net worth is not considered income. Rather it is considered as a separate matter from income. We therefore propose to revise paragraph (b)(2)(ii) to read, “Net worth of a minor family member will be considered in determining dependency of a parent only if it is actually available to the veteran's parent for the minor's support.”

In initially proposed § 5.300 we also failed to address a minor's income. We therefore propose to add a new paragraph (b)(1)(iii) which states, “Income of a minor family member from business or property will be considered income of the parent only if it is actually available to the veteran's parent for the minor's support.” This is merely a plain language restatement of the § 3.250(b)(2) provision quoted above.

5.304 Exclusions From Income—Parent's Dependency

Following publication of proposed § 5.304 in AM07, VA published a rulemaking to implement the “Caregivers” provisions of Public Law 111-163. 76 FR 26148 (May 5, 2011). As we stated in the preamble, “The stipend payments to Primary Family Caregivers under 38 U.S.C. 1720G(a)(3)(A)(ii)(V) constitute `payments [of benefits] made to, or on account of, a beneficiary' that are exempt from taxation under 38 U.S.C. 5301(a)(1). VA does not intend that the stipend replace career earnings.” Consistent with that interpretation, we believe that this stipend should not be counted as income when determining parental dependency. We therefore propose to add this exclusion as § 5.304(l) and redesignate previous paragraph (l) as paragraph (m).

C. Special Ratings AL88

In a document published in the Federal Register on October 17, 2008, we proposed to revise Department of Veterans Affairs (VA) regulations governing special ratings, to be published in new 38 CFR part 5. 73 FR 62004. We provided a 60-day comment period, which ended December 16, 2008. We received a submission from one commenter.

§ 5.320 Determining Need for Regular Aid and Attendance

Current 38 CFR 3.352(c) states, “The performance of the necessary aid and attendance service by a relative of the beneficiary or other member of his or her household will not prevent the granting of the additional allowance.” Initially proposed § 5.320(a) inadvertently omitted this paragraph. We therefore propose to insert this provision, phrased in a clearer way, into § 5.320(a).

The commenter noted that initially proposed § 5.320(b) differs from current § 3.352(a), from which it derives. The current rule defines “bedridden” as “that condition which, through its essential character, actually requires that the claimant remain in bed.” The initially proposed rule defined bedridden as requiring that the claimant “must remain in bed due to his or her disability or disabilities based on medical necessity and not based on a prescription of bed rest for purposes of convalescence or cure.” The commenter asserted that the change of language “may eliminate the possibility of using proof by lay testimony that remaining in bed is required.”

The need for aid and assistance or confinement to bed may be shown by Start Printed Page 71114medical treatment records, medical opinions, and competent non-medical evidence based on personal observations. However, the relationship between service-connected disability and need for aid and attendance or confinement to bed as a result of a service-connected disability must be shown by medical treatment records and medical opinions.

VA will always accept and consider lay evidence, even if such evidence cannot be dispositive of a particular factual issue. The consideration of lay evidence in the context of a determination on whether a person is bedridden is no different that the consideration of lay evidence on the context of any other factual determination. Therefore, we propose not to include an instruction regarding lay evidence.

However, the comment revealed that the initially proposed rule was unclear about the meaning of the term “bedridden”. Current § 3.352(a) states, “The fact that . . . a physician has prescribed rest in bed for the greater or lesser part of the day to promote convalescence or cure will not suffice” to establish bedridden status. The gist of this qualification is to distinguish the need to stay in bed unremittingly from a need to be in bed intermittently. It is the intermittency that distinguishes being in bed “for the greater or lesser part of the day” from being bedridden, not that convalescence or cure is the reason. If a doctor forbids a person to leave bed because of the person's medical condition, the person would be bedridden, whether the prescribed confinement was for convalescence, cure, or other reason. We propose to revise § 5.320(b) to preserve this point, consistent with § 3.352(a), by stating that the person who is bedridden “must remain in bed due to his or her disability or disabilities based on medical necessity and not based on a prescription of periods of intermittent bed rest.” Because the reason for the prescribed confinement is irrelevant, we propose to remove the phrase “for purposes of convalescence or cure”.

The initially proposed rule required that, “The individual is temporarily or permanently bedridden. . . .” A person who is permanently bedridden logically meets the requirement that he or she is temporarily bedridden. Because being either temporarily or permanently bedridden satisfies the requirement of § 5.320(b), there is no need to qualify “bedridden” as either temporarily or permanently. We therefore propose to remove the phrase “temporarily or permanently” before “bedridden”. However, a finding that a veteran is permanently bedridden is significant because such a veteran's special monthly compensation (SMC) will not be reduced based on hospitalization, as we explained in the preamble to the initially proposed rule. See 73 FR 62011, Oct. 17, 2008; see also proposed § 5.724, “Payments and Adjustments to Payments”, 73 FR 65212, Oct. 31, 2008. The only statute that requires payment of SMC based on the “permanently bedridden” criterion is 38 U.S.C. 1114(l). Therefore, we have added a cross reference to § 5.324, the regulation that implements section 1114(l). This change will not affect entitlement, because even a person who is temporarily bedridden will qualify for SMC under section 1114(l) (because such a person needs regular aid and attendance). The change is intended to improve clarity in terms of the potential for a reduction based on hospitalization.

Initially proposed § 5.320(b) omitted the sentence from current § 3.352(a) that states, “It is not required that all of the disabling conditions enumerated in this paragraph be found to exist before a favorable rating may be made.” However, we failed to explain that omission in our preamble. We note that initially proposed 5.320(a) already provided for aid and attendance if the claimant meets “any or all” of the listed criteria. Therefore this sentence was unnecessary and we propose not to include it in § 5.320.

§ 5.321 Additional Disability Compensation for a Veteran Whose Spouse Needs Regular Aid and Attendance

At the end of initially proposed paragraph (a), we propose to add a notation that the term “aid and attendance” used in that paragraph is “defined in paragraphs (b) and (c) of this section.” The notation is needed to ensure that a reader does not think that the term means only the generally applicable definition set forth in proposed § 5.320.

The commenter addressed the visual impairment criteria of automatic eligibility for regular aid and attendance. Initially proposed § 5.321(b) provided that the spouse of a veteran who is 30 percent disabled is automatically considered in need of regular aid and attendance if the spouse's visual impairment meets one of two criteria: “(1) The spouse has corrected visual acuity of 5/200 or less in both eyes; [or] (2) The spouse has concentric contraction of the visual field to 5 degrees or less in both eyes”. Section 3.351(c)(1), from which proposed § 5.321(b)(2) derives, states, “. . . or concentric contraction of the visual field to 5 degrees or less.” The proposed rule specified the bilateral requirement, which VA has long implemented, as we explained in the notice of proposed rulemaking (NPRM). We explained that VA had long used these objective vision criteria to satisfy the regulatory criteria of “blind or so nearly blind”. See 38 U.S.C. 1115(1)(E). Noting that the VA Schedule for Rating Disabilities provides only a 30 percent disability rating for unilateral concentric contraction of the visual field to 5 degrees and a rating of 100 percent for bilateral concentric contraction to that degree, we explained that unilateral contraction could not be considered “so nearly blind as to support a need for aid and attendance”. We further noted that, although the rating schedule applies to ratings for veterans, there is no rational basis not to apply the same criteria for veterans' spouses in considering the proper standards for determining the need for aid and attendance.

The commenter asserts that there is a rational basis to construe the visual impairment criteria of the need for regular aid and attendance differently for the spouse of a 30 percent disabled veteran than for a veteran seeking disability compensation for visual impairment. The commenter stated:

To the contrary, the criterion for granting a veteran, who already has a 30% disability, additional benefits because of having a spouse with a serious visual impairment should be more relaxed than the standard for rating the veteran's own visual impairment. It follows that even a spouse with a unilateral concentric contraction of the visual field to 5 degrees or less would necessarily require regular aid and attendance which would be an additional financial burden on a veteran who is 30% disabled.

We disagree with the commenter for two reasons. First, the aid and attendance criterion of “blind, or so nearly blind” is established by statute. 38 U.S.C. 1115(1)(E)(ii). VA would exceed its authority to “relax” the statutory standard for finding the veteran's spouse in need of regular aid and attendance. As we explained in the initial NPRM, by reference to the VA Schedule for Rating Disabilities, a person with unilateral concentric contraction of the visual field to 5 degrees or less “cannot rationally be considered `so nearly blind' as to need regular aid and attendance.” Section 5.321(b) states an objective measure of vision that VA considers “so nearly blind” as to need regular aid and attendance without further inquiry. It confers the benefit of automatic eligibility without burdening the veteran to prove some other way that his or her spouse is “blind, or so nearly Start Printed Page 71115blind” as to need regular aid and attendance. Section 5.321(b) does not deprive the veteran of the ability to establish need for aid and attendance by other means. This is because § 5.321(c) provides for proof of entitlement with any evidence that shows the veteran's spouse in fact needs regular aid and attendance, even, possibly, with evidence of visual impairment that is much less than the impairment that automatically establishes a need for regular aid and attendance.

Second, we disagree that because a veteran is 30 percent disabled the veteran's spouse would necessarily require regular aid and attendance with unilateral concentric contraction of the visual field to 5 degrees or less, or, by implication, with less impairment than prescribed by proposed § 5.321(b). The need for regular aid and attendance is a function of a person's ability to care for himself or herself, not of another's ability to provide financial or other support. Although the veteran's ability to provide for the spouse financially or otherwise could vary in relation to the veteran's disability, it does not logically follow that the spouse's need for regular aid and attendance varies in relation to the veteran's disability. In light of the discussion above, we propose to make no changes based on this comment.

§ 5.322 Special Monthly Compensation: General Information and Definitions of Disabilities

In initially proposed § 5.322(a)(1), we stated that multiple regulations allow special monthly compensation (SMC) to veterans who have certain service-connected disabilities. In initially proposed paragraph (a)(2), we stated that certain nonservice-connected disabilities will be considered in determining entitlement to SMC, and we listed the relevant sections. To emphasize that service-connected disability is a prerequisite for SMC, we propose to add this sentence to paragraph (a)(1): “Except as specified in paragraph (a)(2) of this section, the disabilities referred to in §§ 5.323-5.333 must be service connected.”

Section 601 of Public Law 111-275, 124 Stat. 2864, 2884 (2010) amended 38 U.S.C. 1114(m) to replace the phrases “at a level, or with complications,” and “at levels, or with complications,” with the phrase “with factors”. The public law also amended section 1114(n) to replace “at levels, or with complications,” with the phrase “with factors” and to replace “so near the shoulder and hip as to” with “factors that”. It also amended section 1114(o) to replace “so near the shoulder as to” with “with factors that”. We propose to revise initially proposed §§ 5.322, 5.325-5.330, and 5.334 to conform to this new statutory language.

In the NPRM, we identified many disabilities in those sections as “service connected”. Given that service-connected disability is a requirement for all SMC benefits (except as specifically provided in certain sections), we have determined that it is unnecessary to specify each disability as service connected throughout those sections. We have therefore removed the modifier “service-connected” throughout §§ 5.321 and 5.323-5.333, except where necessary to distinguish the service-connected disability from a nonservice-connected disability.

§ 5.323 Special Monthly Compensation Under 38 U.S.C. 1114(k)

We have reorganized initially proposed § 5.323(b) and moved one sentence from paragraph (b) into a closely related part 5 section. Initially proposed § 5.323(b) stated limitations on SMC under 38 U.S.C. 1114(k). Paragraph (b)(1) stated limitations on combining SMC under 38 U.S.C. 1114(k) with disability compensation under section 1114(a) through (j). Paragraph (b)(2) stated limitations on combining SMC under section 1114(k) with SMC under 1114(l) through (n). On review, we see that paragraph (b)(1)(ii) stated a limitation germane to paragraph (b)(2). We therefore propose to move it to paragraph (b)(2), and redesignate it as paragraph (b)(2)(i). We propose to redesignate initially proposed paragraph (b)(2) as paragraph (b)(2)(ii).

One provision of initially proposed paragraph (b)(1)(iii) stated that the additional compensation for dependents under 38 U.S.C. 1115 is not subject to the “above limitations”, meaning the limitations in initially proposed paragraph § 5.323(b)(1). We propose to move this provision to § 5.240, “Disability compensation”, because it pertains to all disability compensation, not just to SMC.

The remainder of initially proposed paragraph (b)(1)(iii) stated that “the additional allowance for regular aid and attendance or a higher level of care provided by 38 U.S.C. 1114(r) [is] not subject to the above limitations regarding maximum monthly compensation payable under this paragraph.” To improve clarity, we therefore propose to redesignate this provision of initially proposed paragraph (b)(1)(iii) as paragraph (b)(3) and have clearly identified the excluded limitations as those of § 5.323(b). For consistency throughout part 5, we propose to revise “compensation” to read “disability compensation”. As revised, the sentence will read: “The additional allowance for regular aid and attendance or a higher level of care provided by 38 U.S.C. 1114(r) is not subject to the limitations of paragraph (b) of this section regarding maximum monthly disability compensation payable under 38 U.S.C. 1114(k) in combination with other rates.”

§ 5.324 Special Monthly Compensation Under 38 U.S.C. 1114(l)

The commenter asserted that as initially proposed, § 5.324(d) violated the “benefit of the doubt” rule of 38 U.S.C. 5107(b) by defining “permanently bedridden” as “reasonably certain that the confinement to bed will continue throughout his or her lifetime.” The commenter noted that the benefit of the doubt rule is “[w]hen there is an approximate balance of positive and negative evidence regarding any issue material to the determination of a matter, the Secretary shall give the benefit of the doubt to the claimant.” The commenter argued that to comply with the benefit of the doubt rule, § 5.324(d) should substitute “at least as likely as not” for “reasonably certain”. That is, it should read, “It is at least as likely as not that the confinement to bed will continue throughout his or her lifetime.”

The statute that § 5.324(d) implements authorizes VA to pay special monthly compensation to a veteran who is “permanently bedridden.” 38 U.S.C. 1114(l). We agree that use of the term “reasonably certain” could be misconstrued to require a higher standard of proof than “at least as likely as not”. Therefore, we propose to remove “reasonably certain”. As revised, the standard of proof would be the default standard, which is the “benefit of the doubt” rule. The “benefit of the doubt rule”, found in § 5.3, incorporates the concept of “at least as likely as not.”

§ 5.325 Special Monthly Compensation at the Intermediate Rate Between 38 U.S.C. 1114(l) and (m)

We propose to amend the language in § 5.325 for clarity.

§ 5.326 Special Monthly Compensation Under 38 U.S.C. 1114(m)

In initially proposed § 5.326(i), we provided an award of SMC under 38 U.S.C. 1114(m) based on the facts found “[i]f the veteran has . . . concentric contraction of the visual field to 5 degrees or less in both eyes”. This paragraph was derived from § 3.350(c)(3), which does not include the “or less” criterion. See 38 CFR Start Printed Page 711163.350(c)(3) (“[w]ith . . . the vision field reduced to 5 degrees concentric contraction in both eyes”). We did not explain our reason for the addition of the “or less” criterion. Although we did not receive any comments on this issue, we note that in the NPRM for proposed § 5.325(d) we explained our rationale for treating visual acuity of 5/200 or less and concentric contraction of the visual field to 5 degrees or less as equally disabling. See 73 FR 62012, Oct. 17, 2008. In that notice, we also stated our intent to apply the principle of equivalence of visual acuity of 5/200 or less with concentric contraction of the visual to 5 degrees or less “wherever it is applicable”. It applies to § 5.326(i).

5.330 Special Monthly Compensation Under 38 U.S.C. 1114(o).

In initially proposed § 5.330(c), we stated one combination of disabilities that qualify a veteran for an award under 38 U.S.C. 1114(o) as follows: “Total deafness in one ear, or bilateral deafness rated at 40 percent or more disabling, even if the hearing impairment in one ear is nonservice connected, in combination with service-connected blindness of both eyes having only light perception or less.” We believe the phrase “only light perception or less”, which is also contained in current 38 CFR 3.350(e)(1)(iv), may confuse readers because it fails to explain what “less” refers to. The intent of § 3.350(e)(1)(iv) is to include veterans with only light perception or less vision, so we propose to add the word vision at the end of § 5.330(c).

The preamble to initially proposed 5.330 stated, “We will not repeat § 3.350(e)(4) and the third and fourth sentences of § 3.350(e)(3). These sentences are redundant of § 3.350(e)(1)(ii) . . .” In fact, we actually omitted the second through fourth sentences, for the same reason.

5.332 Additional Allowance for Regular Aid and Attendance Under 38 U.S.C. 1114(r)(1) or for a Higher Level of Care Under 38 U.S.C. 1114(r)(2)

Section 601 of Public Law 111-275, 124 Stat. 2864, 2884 (2010) amended 38 U.S.C. 1114 by adding a new paragraph (t) which provides:

Subject to section 5503(c) of this title, if any veteran, as the result of service-connected disability, is in need of regular aid and attendance for the residuals of traumatic brain injury, is not eligible for compensation under subsection (r)(2), and in the absence of such regular aid and attendance would require hospitalization, nursing home care, or other residential institutional care, the veteran shall be paid, in addition to any other compensation under this section, a monthly aid and attendance allowance equal to the rate described in subsection (r)(2), which for purposes of section 1134 of this title shall be considered as additional compensation payable for disability. An allowance authorized under this subsection shall be paid in lieu of any allowance authorized by subsection (r)(1).

We propose to add a new paragraph (c)(7) to initially proposed § 5.332 to implement this statutory change.

§ 5.333 Special Monthly Compensation Under 38 U.S.C. 1114(s)

In Bradley v. Peake, issued after § 5.333 was initially proposed, the U.S. Court of Appeals for Veterans Claims held that under VA's existing regulation (38 CFR 3.350(i)) entitlement to SMC under section 1114(s) may be provided to a claimant who was assigned “a TDIU [total disability based on individual unemployability] rating based on a single disability to satisfy the statutory requirement of a total rating.” Bradley, 22 Vet. App. 280, 293 (2008). To clearly implement the court's holding, we propose to revise the first paragraph of initially proposed § 5.333 to state:

Special monthly compensation under 38 U.S.C. 1114(s) is payable to a veteran who has a single disability rated 100 percent disabling under subpart B of the Schedule for Rating Disabilities in part 4 of this chapter, or a disability that is the sole basis for a rating of total disability based on individual unemployability (TDIU) under § 4.16 of this chapter, and [additional disabilities as described in either paragraph (a) or (b) of § 5.333].

We propose to revise paragraphs (a) and (b) so that they will be clear when read in connection with these revisions.

§ 5.336 Effective Dates: Additional Compensation for Regular Aid and Attendance Payable for a Veteran's Spouse Under § 5.321

We propose to revise § 5.336 (a)(2) to be in the active voice and to improve clarity. In initially proposed paragraph (a)(2), we stated, “[retroactive] regular aid and attendance for the spouse will also be awarded”. We now propose to clarify that the benefit paid is properly called “additional compensation” for regular aid and attendance. Also, initially proposed paragraph (a)(2) referred to a spouse's “entitlement to regular aid and attendance”. However, it is the spouse's need for, not entitlement to, regular aid and attendance that is the basis for the additional compensation. We therefore propose to change the reference to “entitlement” to a reference to “need”. The whole sentence will read, “When VA awards disability compensation based on an original or reopened claim retroactive to an effective date that is earlier than the date of receipt of the claim,VA will also award additional compensation for any part of the retroactive period during which the spouse needed regular aid and attendance.”

Title 38 CFR 3.501(b)(3) states that the effective date for discontinuance of additional compensation paid based on a spouse's need for regular aid and attendance is the, “[e]nd of month in which award action is taken if need for aid and attendance has ceased.” Initially proposed paragraph (b) stated, “The effective date for the discontinuance of regular aid and attendance will be the end of the month in which VA stops paying the aid and attendance.” The proposed regulation incorrectly stated that VA will stop paying the benefit when we discontinue the benefit. It also failed to identify the reason for the discontinuance: the spouse no longer needs regular aid and attendance. We propose to remedy these two defects by revising the sentence to read, “If the veteran's spouse no longer needs regular aid and attendance, VA will discontinue additional compensation effective the end of the month in which VA takes the award action to discontinue.”

5.337 Award of Special Monthly Compensation Based on the Need for Regular Aid and Attendance During Period of Hospitalization

We have determined that initially proposed § 5.337 is redundant of § 5.720(f). We therefore propose to delete § 5.337 from part 5.

§ 5.350 Benefits Under 38 U.S.C. 1151(a) for Additional Disability or Death Due to Hospital Care, Medical or Surgical Treatment, Examination, Training and Rehabilitation Services, or Compensated Work Therapy Program

Initially proposed § 5.350 erroneously included applicability date rules derived from current § 3.361(a)(1) and (2). Those rules pertain, respectively, to the applicability date of § 3.361 to claims for benefits under 38 U.S.C. 1151(a) generally, and to claims for benefits related to compensated work therapy specifically. No regulation in part 5 will apply before the applicability date of part 5 as a whole, which will be on a date prescribed in the final rule. Consequently, we erred in restating in initially proposed § 5.350 the applicability dates prescribed in § 3.361. We now propose not to include them in § 5.350. We also propose to similarly revise initially proposed §§ 5.351 and 5.353, which also involve benefits under section 1151.Start Printed Page 71117

Section 3.800(a), “Disability or death due to hospitalization, etc.”, provides that:

Where disease, injury, death or the aggravation of an existing disease or injury occurs as a result of having submitted to an examination, medical or surgical treatment, hospitalization or the pursuit of a course of vocational rehabilitation under any law administered by the Department of Veterans Affairs and not the result of his (or her) own willful misconduct, disability or death compensation, or dependency and indemnity compensation will be awarded for such disease, injury, aggravation, or death as if such condition were service connected.

In initially proposed § 5.350, we failed to include a similar basic explanation of the benefits payable under 38 U.S.C. 1151. To correct this omission, we propose to insert similar language as new paragraph (a).

In initially proposed § 5.350(g), we stated, “The benefit payable under 38 U.S.C. 1151(a) to an eligible survivor for a veteran's death occurring after December 31, 1956, is dependency and indemnity compensation.” This paragraph is unnecessary because we use the term “dependency and indemnity compensation” in new paragraph (a), and part 5 will not govern any claims filed on or before December 31, 1956. We therefore propose to delete paragraph (g).

§ 5.352  Effect of Federal Tort Claims Act Compromises, Settlements, and Judgments Entered After November 30, 1962, on Benefits Awarded Under 38 U.S.C. 1151(a) for Additional Disability or Death Due to Hospital Care, Medical or Surgical Treatment, Examination, Training and Rehabilitation Services, or Compensated Work Therapy Program

For the same reasons explained above as to § 3.350, we propose to delete initially proposed paragraph (a), which had stated that this rule applied to claims received after September 30, 1997. Accordingly, we propose to redesignate initially proposed paragraph (b) as paragraph (a), proposed paragraph (c) as paragraph (b), and proposed paragraph (d) as paragraph (c). We propose to remove unnecessary language from these paragraphs for clarity.

We propose to add paragraph (d), “Offset of award of benefits under 38 U.S.C. chapter 21 or 38 U.S.C. chapter 39”, to initially proposed § 5.352. Section 304(c) of the Veterans Benefits Improvement Act of 2004 amended 38 U.S.C. 1151(b) by adding section 1151(b)(2) relating to offset of chapter 21 and 39 benefits. VA amended current § 3.362 in August 2006 by adding paragraph (e) to that section to implement the part of 38 U.S.C. 1152(b) pertaining to 38 U.S.C. chapter 39. On September 23, 2010, VA amended § 3.362(e) to implement 38 U.S.C. 1151(b) pertaining to 38 U.S.C. chapter 21. See 75 FR 57859. Initially proposed § 5.352 omitted a counterpart to § 3.362(e). We now propose to add the language of § 3.362(e), reorganized for clarity.

§ 5.360 Service Connection of Dental Conditions for Treatment Purposes

Initially proposed § 5.360 was based on 38 CFR 3.381 as it existed at the time (2008). See 73 FR 62004. VA revised § 3.381 on January 30, 2012 (77 FR 4469). This amendment was intended to clarify the language of § 3.381 by adding a new introductory paragraph (a) explaining the types of issues that VBA adjudicates in a dental claim. VA also added a sentence to § 3.381(b) explaining that, “These conditions and other dental conditions or disabilities that are noncompensably rated under § 4.150 of this chapter may be service connected for purposes of Class II or Class II (a) dental treatment under § 17.161 of this chapter.”

We propose to revise initially proposed § 5.360(a), “General Principles”, to incorporate the new introductory paragraph (a) of § 3.381 and to add a statement explaining what service connection for treatment purposes means. We likewise propose to include the second sentence of § 3.381(b) in § 5.360(c)(3). We also propose to revise initially proposed § 5.360 to simplify the provisions, to state the provisions in the active voice, to specify which Administration within VA must make which determinations, and to reorder the provisions in a more logical sequence.

We propose to change the sequence of the paragraphs, designating paragraph (b) as (c), paragraph (c) as (e), paragraph (d) as (b), and paragraph (e) as (d). It is more logical to include the paragraphs concerning what VA will service connect for treatment purposes together and in sequence and before the paragraph that provides for the conditions VA will not service connect for treatment purposes.

In proposed paragraph (c) (initially proposed paragraph (b)), we propose to rephrase the first sentence to state it in the active voice. We propose to remove the modifier, “chronic” from periodontal disease in paragraph (iv) because VA will treat any periodontal disease in a veteran who is eligible for treatment in accordance with the provisions of § 17.161 of this chapter. Periodontal disease, whether labeled acute or chronic, is classified based on the severity of the disease. Gingivitis, which is acute and treatable, is a milder form of periodontal disease. Periodontitis, which is chronic, is the condition that develops if gingivitis is untreated. Since these are essentially different stages of the same disease, VA will treat both stages.

We propose to remove the phrase, “outpatient dental” from the first sentence of paragraph (e) (initially proposed paragraph (c)) because it is redundant and unnecessary. This entire section concerns service connection of dental conditions for treatment purposes. It is immaterial whether VA treats the veteran as an outpatient or while hospitalized. We also propose to remove “acute periodontal disease” from the list of conditions that VA will not service connect for treatment purposes for the reasons stated earlier. We propose to redesignate the subsequent paragraphs accordingly.

§ 5.365 Claims Based on the Effects of Tobacco Products

Initially proposed § 5.365 restated § 3.300 essentially without change. Initially proposed § 5.365(b)(1) stated: “The disability or death resulted from injury or disease that is otherwise shown to have been incurred or aggravated during service, which means that the disability or death can be service connected on some basis other than the veteran's use of tobacco products during service.” The phrase “otherwise shown to have been incurred or aggravated” quotes paragraph (b) of the authorizing statute, 38 U.S.C. 1103. However, we have determined that the phrase “the disability or death can be service connected on some basis other than the veteran's use of tobacco products during service” is the premise of the paragraph. The other language in the initially proposed paragraph is superfluous. We therefore propose to remove this other language.

We also determined that the phrase, “the disability became manifest or death occurred during service”, which appeared in initially proposed (b)(1), is a separate exception to paragraph (a). We therefore propose to designate it paragraph (b)(2). Consequently, we propose to redesignate initially proposed paragraph (b)(2) as (b)(3) and initially proposed paragraph (b)(3) as (b)(4).

We further propose to change the word “appeared” in initially proposed paragraph (b)(2), redesignated paragraph (b)(3), to “manifested” because the cited sections, §§ 5.260 through 5.268, use the word “manifested”. Likewise, 38 U.S.C. 1103(b) uses the word “manifest”.Start Printed Page 71118

In the preamble to the initially proposed rule, we explained that we were not repeating the first clause of § 3.300, “For claims received by VA after June 9, 1998,” because all claims under part 5 will be received after 1998. We have noted that one of the authority citations listed in initially proposed § 5.365 was 38 U.S.C. 1103 note. Because this note only concerns this effective date provision, we propose to omit it from § 5.35.

§ 5.367 Civil Service Preference Ratings for Employment in the U.S. Government

Initially proposed § 5.367 was not explicit as to the purpose of the civil service preference ratings. We now propose to clarify that these ratings are for “employment by the U.S. government”. This clarification is consistent with current practice.

The second sentence stated, “Any directly or presumptively service-connected injury or disease that exhibits some extent of actual impairment may be held to exist at the level of less than 10 percent.” This implied a two-step process in which VA found “actual impairment” and then assigned a rating of less than 10 percent. In fact, there is only one step: if a veteran has any actually disabling directly or presumptively service-connected disability he or she will qualify for the civil service preference. We propose to revise the sentence to say this explicitly.

§ 5.368 Basic Eligibility Determinations: Home Loan and Education Benefits

In initially proposed § 5.368 (a)(1), we stated that claims based on service after January 31, 1955, and before August 5, 1964; or after May 7, 1975, would be governed by the presumption of aggravation in current § 3.306(a) and (c). This was derived from current § 3.315(b). However, the current rule is incorrect, and should refer to § 3.306(b), which applies to all claims based on service after December 7, 1941. We will state the rule correctly in part 5. We propose to make the same correction to paragraph (b)(4).

XI. Subpart F: Nonservice-Connected Disability Pensions and Death Pensions Improved Pension

A. Improved Pension

In a document published in the Federal Register on September 26, 2007, we proposed to revise VA's regulations governing Improved Pension benefits, to be published in a new 38 CFR part 5. 72 FR 54776. We provided a 60-day comment period that ended November 26, 2007. We received no comments.

Although we received no comments regarding our publication on September 26, 2007, an internal review of initially proposed Subpart F revealed several drafting errors that needed to be corrected, and we propose to do so. We also propose to make organizational and technical changes to improve the clarity of the regulations, and to maintain consistency throughout part 5.

§ 5.370 Definitions for Improved Pension

We propose to add a general definition of “Improved Pension”, as § 5.370 (d), to be consistent with our practice of providing general definitions for the benefits provided by VA. See, for example, §§ 5.240(a) (defining disability compensation) and 5.460 (defining certain VA pension programs). The text of the definition is based on the text of what was initially proposed as § 5.371, with minor revisions to improve clarity.

We also propose to add a definition of “Improved Pension payment amount” as paragraph (e), which is “the monthly payment calculated under § 5.421(a)”.

In the definition of “Maximum annual pension rate”, proposed paragraph (f), we changed the reference to § 5.400 from “The various types of maximum annual pension rates are set forth at § 5.400” to “Maximum annual pension rates are described in § 5.400”. Section 5.400 does not “set forth” any rates; it merely refers the reader to title 38, United States Code.

In this revised version of § 5.370, we would add a definition of “net worth in proposed paragraph (g)” as “the value of real and personal property, as calculated under § 5.414”. This is a general definition, and is consistent with common usage of the term; however, it will be useful to provide a definition in this central location of § 5.370, where it will guide readers to the relevant (and more detailed) substantive rules in § 5.414.

In § 5.370, we initially proposed to define “special monthly pension” as:

[A] type of Improved Pension with higher maximum annual pension rates than the basic rates listed in § 5.400(a)(1) and (5). Special monthly pension is based on a veteran's or surviving spouse's disability or disabilities ratable at 60 percent or more, their housebound status, or their need of the aid and attendance of another person in performing their daily living habits.

We propose to revise the definition in proposed paragraph (i) to make it more general; specific entitlement criteria are more appropriately discussed in the substantive rules at §§ 5.390 and 5.391. There is no need to restate those criteria here. We will explicitly note in the definition that claimants for special monthly pension must meet the eligibility criteria for Improved Pension, notwithstanding that this is implied by the definition of special monthly pension as a “type of Improved Pension”.

We propose to delete the initially proposed definition of “surviving child” as unnecessary and redundant of other material in part 5.

§ 5.371 Eligibility and Entitlement Requirements for Improved Pension

We propose to revise § 5.371(a) so that it is in the active voice and so that it specifically refers to special monthly pension, where, in the initially proposed version, it applied only implicitly to special monthly pension. In addition, we propose to delete from paragraph (a) the material that was moved to the definition in § 5.370.

Initially proposed paragraph § 5.371(c) states the general rules for the eligibility requirements to Improved Death Pension for a surviving spouse or surviving child. We propose to add cross-references in § 5.371(c)(1) and (2) to the part 5 regulations relating to status as a surviving spouse, and surviving child.

We propose to clarify paragraph § 5.371(c) by moving the material in initially proposed § 5.371(c)(3) to the beginning of the paragraph. The purpose of the language is to explain that in determining eligibility for Improved Death Pension, it does not matter whether the veteran's death is service-connected.

§ 5.372 Wartime Service Requirements for Improved Pension

We propose to add the word “nonconsecutive” to § 5.372 (b)(2), to illustrate that, unlike the period described in paragraph (b)(1), the days need not be consecutive to meet this requirement. Indeed, if the days were consecutive, the service described in paragraph (b)(2) would meet the requirements of paragraph (b)(1). We do not need to add the word “nonconsecutive” to paragraph (b)(3) because that paragraph explicitly requires two separate periods of service.

Initially proposed § 5.372(b)(4)(ii) provided wartime service if the veteran served for any period of time during a period of war and had a disability “at the time of discharge that in medical judgment would have justified a discharge for disability”. This requirement appears in current § 3.3(a)(3)(ii). In part 5, we will remove the “medical judgment” requirement. Instead, we will require that the veteran Start Printed Page 71119have “had such a service-connected disability at the time of discharge that would have justified discharge.” This change will recognize that in some cases lay evidence may be sufficient to establish the existence of a disability that could have served as a basis for discharge.

In addition, we propose to improve the clarity of the paragraph by specifying that the disability that existed at discharge must be one for which service connection is granted without relying on a presumption. This is consistent with current § 3.3(a)(3)(ii).

§ 5.373 Evidence of Age in Improved Pension Claims

In initially proposed § 5.373, we stated that the regulation applies when age “is material to the decision of an Improved Pension claim”. It is possible to misread this language as a narrowing of the current rule, such that the new rule would apply only when age is outcome determinative. We therefore propose to remove the phrase “the decision of”. As revised, the part 5 rule will be substantively identical to the current rule.

§§ 5.380 Disability Requirements for Improved Disability Pension; 5.381 Permanent and Total Disability Ratings for Improved Disability Pension Purposes; and 5.382 Improved Disability Pension—Combining Disability Ratings

We propose to significantly revise §§ 5.380, 5.381, and 5.382 by combining the initially proposed regulations, removing redundant material, correcting errors, and otherwise improving clarity. In addition, we propose to reserve §§ 5.381 and 5.382, and several other changes as discussed below.

In § 5.380(a), we propose to add guidance on how VA combines disability ratings to determine whether a veteran is permanently and totally disabled for Improved Pension purposes. This guidance was initially contained in proposed § 5.382(b). We now propose to move § 5.382(b) to § 5.380(a) because it is more logical to state that provision in § 5.380(a) along with the other disability requirements. We also propose to eliminate § 5.382(a) because in the case, as here, where a veteran has multiple disabilities, all disabilities are combined in the same manner, regardless of whether the disability is service or non-service connected. We now propose to mark § 5.382 as reserved.

In initially proposed § 5.380, we failed to explain our omission of current 38 CFR 3.342(b)(5). We consider that paragraph to be a comingled authority citation and cross reference and we therefore believe it is unnecessary in part 5.

Initially proposed § 5.381(b)(2), which is now § 5.380(c)(2), consisted of seven sentences that were not logically organized and were not stated clearly. We propose to reorganize the material. In sentence one, we propose to replace “consistent with the evidence in the case” with “that is shown by the evidence”, because that phrase has the same meaning as “consistent with the evidence” and is easier for the public to understand. For the same reason, we propose to use the phrase “that is shown by the evidence” in paragraphs (c)(2)(i) through (iii). The remaining material will be divided into three separate paragraphs, § 5.380(c)(2)(i) through (iii), to distinguish between generally applicable rules, rules that apply to cases involving disabilities that require hospitalization for indefinite periods, and special rules that apply only in tuberculosis cases.

In what was initially proposed as § 5.381(b)(3), which is now proposed § 5.380(c)(3), we propose to remove language requiring VA to give “special consideration” to veterans under 40 years of age. As revised, the regulation will describe how VA determines the permanence of total disability in such veterans, without suggesting that VA treats these veterans in a “special” way, that is, without suggesting that these veterans are not entitled to the same treatment as any other veteran.

In initially proposed § 5.381(b)(4), which is now § 5.380(c)(4), we propose to change “presumed” to “considered” to be consistent with the current regulation, § 3.342(b)(4), and the statute, 38 U.S.C. 1718(g). “Considered” is more favorable to veterans because it establishes a rule rather than a rebuttable presumption.

In initially proposed § 5.381(b)(4)(i), which is now § 5.380(c)(4)(i), we repeated a typographical error from § 3.342(b)(3)(i) by using “member-employer”. The correct term is “member-employee”. Compare 50 FR 36632, Sept. 9, 1985 (proposed amendment of § 3.342(b)(4) using “member-employee”) with 50 FR 52775, Dec. 26, 1985 (final rule amending § 3.342(b)(4) using “member-employer”).

In initially proposed § 5.381(b)(5), which is now § 5.380(c)(5), we had cross-referenced a part 5 regulation that would be based on current 38 CFR 3.321(b)(2) (concerning extra-schedular ratings for pension). We have since decided against establishing a separate regulation based on that current rule. Thus, in the revised § 5.380(c)(5), we propose to include a rule equivalent to current 38 CFR 3.321(b)(2).

§ 5.383 Effective Dates of Awards of Improved Disability Pension

We have determined that initially proposed § 5.383(a)(2) is an exception to the general effective date rule for Improved Disability Pension. It deals with previously denied claims, and we propose to name it as addressing such claims and redesignate it as paragraph (b). What was previously proposed paragraph (b) will now be proposed paragraph (c).

We propose to revise § 5.383(b)(3), eliminating the description of an incapacitating disability, which was circular and confusing. The revised language will also affirmatively state that a disability that requires extensive hospitalization is an incapacitating disability for Improved Disability Pension purposes, whereas the initially proposed language appeared to establish a rebuttable presumption to the same effect. Compared to current § 3.400(b)(1)(ii)(B) and to the initially proposed rule, the revised rule is easier to understand and apply. Consequently, this will be a change from both part 3 and the initially proposed rule, but it will result in a clearer regulation and will not lead to later effective dates of awards to disabled veterans.

§ 5.390 Special Monthly Pension for a Veteran or Surviving Spouse Based on the Need for Regular Aid and Attendance

Initially proposed § 5.390 was titled, “Special monthly pension for veterans and surviving spouses at the aid and attendance rate.” We propose to revise the title to read, “Special monthly pension for a veteran or surviving spouse based on the need for regular aid and attendance.” The revision is in part to help clarify that special monthly pension is essentially Improved Pension paid at a higher maximum annual pension rate. The revision also makes the reference to regular aid and attendance consistent with our terminology in the rest of part 5.

We propose to make significant clarifications, eliminate redundancy, and otherwise simplify the introductory paragraph, proposed as § 5.390(a).

In initially proposed § 5.390(b)(4), which is now § 5.390(d), we had cross-referenced § 5.333 for the rules to govern factual need for aid and attendance. We propose to change this citation to § 5.320 because we propose to renumber the regulation.Start Printed Page 71120

§ 5.391 Special Monthly Pension for a Veteran or Surviving Spouse At the housebound rate

In initially proposed part 5, there are several regulations that define “permanently housebound” as it applies to the veteran and the surviving spouse. To ensure consistency throughout part 5, we propose to change the definition in § 5.391(a)(2), to the language used in proposed § 5.511(c). Proposed paragraph (a)(2) will now define the term to mean that the veteran is substantially confined to his or her residence (ward or clinical areas, if institutionalized) and immediate premises because of a disability or disabilities, and that it is reasonably certain that such disability or disabilities will not improve during the veteran's lifetime.

Initially proposed § 5.391(b) was a new provision intended to reconcile current VA regulations, which have not been altered since being promulgated in 1979, with Hartness v. Nicholson, 20 Vet. App. 216 (2006). In that case, the United States Court of Appeals for Veterans Claims (CAVC) stated that current § 3.351(d) does not consider the interpretive effects of 38 U. S.C. 1513(a), first enacted in 2001, on 38 U.S.C. 1521(e). See Hartness, 20 Vet. App. at 221. The CAVC held that, according to these statutes, a veteran who is otherwise eligible for Improved Pension based on being age 65 or older, and who is not in need of regular aid and attendance, is entitled to special monthly pension at the housebound rate if he or she has a disability ratable at 60 percent or more or is considered permanently housebound. See Hartness, 20 Vet. App. at 221-22. The court held that such a veteran, unlike a veteran who is under 65 years old, need not have a disability that is permanent and total. See id.

However, in 2012, the U.S. Court of Appeals for the Federal Circuit overturned Hartness. In Chandler v. Shinseki, 676 F.3d 1045 (Fed. Cir. 2012), the court stated:

This court concludes § 1513(a) only eliminates the permanent and total disability requirement in § 1521(a), which applies to all § 1521 subsections. The language of section 1521 is structured so that subsection (a) is a threshold requirement and the other subsections recite additional requirements for a veteran to qualify for different pension rates. As such, § 1521's language and structure, when viewed in light of the statute's purpose and meaning, suggest that the parenthetical exclusion in section 1513(a) refers only to the threshold requirement found in section 1521(a) for pension benefits under § 1521 and not to the additional [housebound] requirements imposed by § 1521(e). slip op at 11.

We therefore propose to delete § 5.391(b) and reorder the section paragraphs accordingly.

§ 5.392 Effective Dates of Awards of Special Monthly Pension

Although it was technically accurate, initially proposed § 5.392, “Effective dates of awards of special monthly pension”, was unnecessarily complex. In paragraph (a), we had stated the general rule that the effective date of an award of special monthly pension was the date VA received the claim for special monthly pension or the date entitlement arose, whichever date is later. This is essentially the same as the effective date of an award of Improved Pension under §§ 5.383 and 5.431, except that it does not address the eligibility or entitlement criteria for Improved Pension. It is unnecessary for the special monthly pension effective date regulation to address such criteria, because the claimant must have met those criteria as a prerequisite for the award. Moreover, in cases where a claimant who was not already receiving Improved Pension is awarded special monthly pension, the claim for Improved Pension constitutes the claim for special monthly pension, because special monthly pension is a form of Improved Pension paid at a higher maximum annual pension rate. Thus, the award of special monthly pension is predicated upon the same rules that govern the award of Improved Pension, and the award of special monthly pension will be effective on the same date as the award of Improved Pension in every situation except where entitlement to special monthly pension arose after the date of entitlement to Improved Pension. This could occur in a case where an Improved Pension beneficiary files a new claim for special monthly pension, or where a claimant seeking Improved Pension incurs, after filing the Improved Pension claim, additional disability that makes him or her eligible for special monthly pension. Hence, we propose to revise the rule to simply state that the effective date of an award of special monthly pension will be the later of either the effective date of the award of Improved Pension under § 5.383 or the award of Improved Death Pension under § 5.431, or the date entitlement to special monthly pension arose.

In initially proposed § 5.392 we failed to include the provisions of 38 CFR 3.402(c)(1), concerning aid and attendance, and housebound benefits payable to a surviving spouse. We propose to correct this omission by adding a reference to proposed § 5.431, “Effective dates of Improved Death Pension”. We also omitted the provisions of § 3.402(c)(2), concerning concurrent receipt of Improved Pension and Improved Death Pension. We propose to correct this omission by adding a new paragraph (b).

In initially proposed § 5.392(b), we stated an exception applicable “when an award of Improved Pension is effective retroactively”. This refers to the retroactive provisions in § 5.383(b). By referencing § 5.383 in its entirety in § 5.392(a), the simplified version of paragraph (a) will eliminate the need for this exception.

§ 5.400 Maximum Annual Pension Rates for a Veteran, Surviving Spouse, or Surviving Child

After reviewing initially proposed § 5.400, we propose to make several changes, including redesignating due to the removal and revision of certain paragraphs, described below.

We determined that it would be helpful for readers to know that the rates of pension are listed on the Internet. We therefore propose to add the following sentence to what is now the introductory paragraph (which, as initially proposed, was designated as paragraph (a)): “Current and historical maximum annual rates can be found on the Internet at http://www.va.gov or are available from any Veterans Service Center or Pension Management Center.” We propose to include “Pension Management Center” because most pension cases are processed in these three centers. We propose to remove from that paragraph language related to 38 U.S.C. 5312 because it was redundant of § 5.401. For similar reasons, we propose to add “Pension Management Center” to initially proposed § 5.471(a).

Also in reviewing this section, we found that what is now designated as paragraph (e) could be simplified to refer only to a surviving spouse. The authorizing statute for that paragraph addresses the different rates based on whether or not the spouse has custody of a child of the deceased veteran.

We propose to delete initially proposed § 5.400(b), pertaining to World War I veterans, because VA does not have any Improved Pensioners on its rolls who served in World War I and does not expect to receive any new claims from such veterans. If any claims are received, they may be adjudicated in accordance with 38 U.S.C. 1521(g), which provides the higher rate for such veterans.

Finally, we propose to move the information that had been contained in initially proposed § 5.400(c), concerning higher maximum annual pension rates Start Printed Page 71121based on the number of dependents, to the second sentence of what is now the introductory paragraph. We were concerned that the separate paragraph would lead a reader to think that paragraph (c) was an exception to the information in the introductory paragraph when, in fact, the statutes referred to in the introductory paragraph provide the higher rates.

§ 5.401 Automatic Adjustment of Maximum Annual Pension Rates

We propose to omit a counterpart to § 3.23(c) from § 5.401. The preamble to initially proposed §  5.401(b), 72 FR 54776, 54782-54783 (Sept. 26, 2007), stated that it derives, in part, from §  3.23(c), which provides for publication of increases in the rate of pension paid to Mexican border period and World War I veterans. As explained in the initial, 72 FR 54776, 54782, and current preambles for §  5.400, part 5 will not repeat 3.23(c) because it is obsolete. Consequently, though proposed 5.401(b) restates the requirement to publish increases in the rate of certain benefits, VA will not publish increased in the rate for veterans of the Mexican border period or World War I, and §  5.401(b) does not partly derive from §  3.23(c).

§ 5.410 Countable Annual Income

We propose to clarify § 5.410(a)(1) and make its phrasing parallel in structure to paragraph (a)(2) for consistency.

In initially proposed § 5.410(b)(3), we stated that: “The income of a surviving child includes the income of that child's custodial parent and the income of other surviving children as described in § 5.435, `Calculating annual Improved Pension amounts for surviving children.' ” The preamble to the initially proposed rule explained that the rule regarding whose income must be included in a surviving child's income was “too complex to be included in this regulation, so we propose to include a cross-reference to proposed § 5.435”. However, § 5.435 requires including the income of the surviving child's custodian, irrespective of whether the custodian is a “custodial parent”. Thus, the reference in § 5.410(b)(3) to “custodial parent” was improperly narrow. We therefore propose to change the term “custodial parent” to “custodian”. This change corrects the erroneous reference to a “custodial parent” in the proposed rule. We also propose to clarify in paragraph (b)(3) that the income of a surviving child includes that child's income, to make the provision consistent with paragraphs (b)(1) and (2).

We propose to add paragraphs (c)(3)(i) and (ii) to address overlapping irregular income. This type of income was not previously addressed. This change follows current VA practice.

§ 5.411 Counting a Child's Income for Improved Pension Payable to a Child's Parent

In reviewing initially proposed § 5.411, we determined that this section could be much clearer, and we also identified several problems with the initially proposed regulation.

In paragraph (a), we propose to now state the general rule, which is that “VA counts as income to the parent-beneficiary (that is, the veteran or surviving spouse receiving Improved Pension) the annual income of every child of the veteran who is in the parent-beneficiary's custody”. In current § 3.23(d)(4) and (5), this rule is phrased as a presumption: “There is a rebuttable presumption that all of such a child's income is available to or for the [parent-beneficiary].” Using a presumption makes this rule far more complicated than it needs to be. Moreover, neither the current regulation nor the initially proposed part 5 regulation clearly stated that the parent-beneficiary must specifically seek to rebut the presumption. Thus, in § 5.411(a), we propose to state that the child's income is counted as income to the parent-beneficiary unless the parent-beneficiary files a claim to exclude all or part of the child's income.

We also, in paragraph (a), propose to establish a duty on the part of VA to provide the proper VA form to describe the bases for the exclusions that follow. VA uses VA Form 21-0571, “Application For Exclusion Of Children's Income”, to gather the information needed to calculate whether a parent-beneficiary qualifies for an exclusion. Much of the specificity that we have added to § 5.411 in this rulemaking is derived from that form, and using that form simplifies the process and greatly reduces the burden of seeking an exclusion under this rule.

In initially proposed § 5.411(b), we set forth the first basis for an exclusion of the child's income, which is that the income is not considered available for expenses necessary for reasonable family maintenance. We propose to change the term “reasonably available” to “considered available” for clarity. This rule is similar to the current and initially proposed rules, except that in paragraph (b)(2) we provide specific examples of common ways to establish that income is not considered available. These examples are derived from current VA practice and VA Form 21-0571.

In § 5.411(c), we describe the hardship exclusion. The calculation required under paragraphs (c)(1) through (5) was included in the initially proposed rule and is set forth in current § 3.272(m), but it is not clearly described as a mathematical formula. This subsequently proposed rule more clearly shows how VA calculates the amount of the hardship exclusion.

In paragraph (b)(1), we propose to add that annual expenses cannot include “expenses for items such as luxuries, gambling, and investments”. This guidance is based on long-standing VA practice and will clarify for VA employees what types of expenditures are, or are not, necessary to support a reasonable quality of life.

Finally, we propose to move what was initially proposed as § 5.411(c), “Child's earned income”, to § 5.412(a). This provision was mistakenly included in § 5.411, but it applied, by its terms, to calculating a child's income in all situations. Hence, we have moved it to § 5.412(a), where it is more appropriately located. We propose to redesignate the paragraphs of initially proposed § 5.412 to accommodate the new paragraph (a).

§ 5.412 Income Exclusions for Calculating Countable Annual Income

In Osborne v. Nicholson, 21 Vet. App. 223 (2007), the court held that “pursuant to § 3.272(e), the receipt of accrued interest on the redemption of a savings bond is `profit realized from the disposition of . . . personal property' and is therefore excluded from income for VA pension purposes.” A GC Opinion was issued based on this ruling, VAOPGCPREC 2-2010 (May 10, 2010). The GC Opinion stated that the holding of Osborne v. Nicholson depended not on the political entity that issued the bond, but rather on the terms of the bond. The Opinion further stated that “If a bond requires redemption for the payment of accrued interest . . . then the statutory exclusion for profit realized from the disposition of real or personal property applies. If accrued interest is payable on the bond without redemption, then it does not qualify for the exclusion.” This income exclusion also applies to interest received from the surrender of a life insurance policy. However, if a bond pays interest semiannually without the redemption of such bond, VA will consider the interest received as income. The GC Opinion also held that the exclusion of interest received from the redemption of a bond applies to income calculations in parents' dependency and indemnity Start Printed Page 71122compensation (DIC), Improved Pension, and Section 306 Pension. Section 3.262(k) excludes from income the accrued interest received from the redemption of a savings bond for purposes of Section 306 Pension and parents' DIC to the extent that § 3.272(e) excludes such income in Improved Pension. Conversely, there is no profit exclusion for Old-Law Pension in § 3.262(k)(3). VA will therefore consider as income the interest received from the surrender of a bond or life insurance in Old-Law Pension. Although not specifically stated in the Opinion, we believe that this exclusion also applies in the income calculation for the dependency of a parent for purposes of disability compensation. This interpretation is considered to be just and consistent with the intent of the statute.

We therefore propose to incorporate the holding of the GC Opinion in proposed § 5.412(e). We also propose to include similar changes in §§ 5.302(d), “General income rules—parent's dependency”, 5.472, “Evaluation of income for Old-Law Pension and Section 306 Pension”, and 5.533, “Income not counted for parent's dependency and indemnity compensation.”

In initially proposing this subpart, we inadvertently omitted § 3.272(x) (listing “lump-sum proceeds of any life insurance policy on a veteran” as an item VA will not count when calculating countable income for Improved Pension), so we propose to insert § 5.412(l)(8) as its part 5 equivalent.

We propose to move the broad provision proposed as § 5.412(k)(8) to § 5.412(m).

Section 604 of Public Law 111-275, 124 Stat. 2864, 2885 (2010) amended 38 U.S.C. 1503(a) to exclude payment of a monetary amount of up to $5,000 to a veteran from a State or municipality that is paid as a veterans benefit due to injury or disease from countable income for purposes of Improved Pension. We propose to add this exclusion as § 5.412(n).

§ 5.413 Income Deductions for Calculating Adjusted Annual Income

In reviewing initially proposed § 5.413, we determined that this section could be clarified. We propose to revise the language, particularly in paragraph (b), to more accurately reflect current policy. These changes will not alter the legal effect of this section. In paragraph (b), we propose to add a cross-reference to § 5.707, “Deductible Medical Expenses,” to be consistent with § 5.474, “Deductible Expenses for Section 306 Pension Only”, and § 5.532, “Deductions from income for parent's dependency and indemnity compensation.”

We propose to revise paragraphs (b)(2)(i) and (ii). As initially proposed, the provision could be interpreted to permit deductions for a member of the household “for whom there is a moral or legal obligation of support” on the part of the beneficiary, irrespective of whether that person was a relative of the beneficiary. The part 3 rule, located in § 3.272(g)(1) and (2), requires that the person be both a relative and a member of the household. We propose to revise § 5.413(b)(2) so that it accords with the current rule. We also propose to correct an error in initially proposed paragraph (b)(2)(i). The initially proposed provision and the current rule, § 3.272(g)(1)(i) and (ii), refer incorrectly to the veteran's “spouse” instead of referring to the veteran's “dependent spouse”.

In paragraphs (c)(2)(ii) and (iii), we propose to remove a reference to “just debts” because “just debts” are included in the definition of final expenses set forth in paragraph (c)(1).

We propose to remove the reference to chapter 51 and § 5.551(e) in § 5.413(c)(3)(i). The current rule, § 3.272(h)(1)(ii), and the authorizing statute, 38 U.S.C. 1503(a)(3), only reference “expenses not reimbursed under chapter 23 of this title”. We propose to revise § 5.413(c)(3)(i) so that it accords with them.

We also propose to clarify § 5.413(c)(3)(ii) to state that if “The expenses of a veteran's last illness were allowed as a medical expense deduction on the veteran's pension or parents' dependency and indemnity compensation (DIC) account during the veteran's lifetime”, then said expenses will not be deducted from a surviving spouse's award. This change will follow current VA practice.

Subsequent to the publication of proposed § 5.413, section 509 of Public Law 112-154 (2012) amended 38 U.S.C. 1503(a) by adding new provisions which set forth in detail what casualty loss reimbursements are excludable from countable income for purposes of VA Improved Pension. We propose to include these new provisions in § 5.413(d).

We propose to move § 5.413(e), concerning the treatment of gambling losses, to § 5.410(g), because it primarily concerns counting income from gambling. Initially proposed paragraph (f) of this section is redesignated paragraph (e), accordingly. Initially proposed § 5.413(g), which is now § 5.413(f), used the term “profession”. The regulation meant a professional practice. We are now clarifying this term.

§ 5.414 Net Worth Determinations for Improved Pension

In reviewing initially proposed § 5.414, we determined that this section could be clarified by the reorganization and removal of unnecessary verbiage. We also propose to provide more detailed explanations of when a dependent's net worth is considered and how net worth can bar Improved Pension.

In what is now paragraph (b)(1) (initially proposed paragraph (a)), we propose to add the word “primary” before residence to clarify that VA excludes from net worth only the value of the residence where the claimant or beneficiary usually lives, not the value of other properties where they may occasionally reside. A claimant or beneficiary can only have one primary residence at any given time. The term is well understood because a primary residence is considered as a legal residence for purpose of income tax and/or acquiring a mortgage. We also propose to clarify that the primary residence will not be counted as net worth simply because the veteran has moved into a nursing home.

In what is now paragraph (b)(3) (initially proposed paragraph (c)(3)), we propose to clarify that the “child educational exclusion” applies whether the child is a dependent or a claimant in his or her own right.

In § 5.414(d)(2)(i), we propose to clarify that a claimant's adjusted annual income includes the adjusted annual income of any person whose net worth is considered part of the claimant's net worth. These rules were not explicit in the initially proposed rule, but they comport with current VA practice and policy and are not inconsistent with the initially proposed rule.

In initially proposed § 5.414(d), we determined that there was a lack of criteria for determining whether net worth is a bar for benefits. To eliminate ambiguity, we propose to establish an $80,000 guideline and determined that “it is reasonable to expect that part of the claimant's net worth should be used for the claimant's living expenses” when the net worth is $80,000 or more. Having a specific dollar amount ensures uniformity and fairness of VA decision-making throughout the country. This change is consistent with current practice.

We also propose to revise § 5.414(e) for clarity.Start Printed Page 71123

§ 5.415 Effective Dates of Changes in Improved Pension Benefits Based on Changes in Net Worth

We had stated in § 5.415(a) that an increase in a child's net worth requires VA to reduce the payment amount of Improved Pension. However, if the child's net worth is increased, the removal of his dependency from the beneficiary's award may cause an increase in payment. Such a situation may occur when the dependent child has income and the removal of the child's dependency and his or her income causes an increase in the beneficiary's award. We propose to clarify that regardless of whether or not the removal of such child's dependency results in a higher pension rate, the effective date based on the change in net worth is the first day of the year after the year that net worth increased. This change is consistent with current practice.

§ 5.416 Persons Considered as Dependents for Improved Pension

We propose to remove the sentence, “The child need not be living with the veteran or surviving spouse to be in custody”, from initially proposed § 5.416(b)(1) because the same information is provided in what was initially proposed § 5.417(d), now the definition of “custody of a child” in proposed § 5.1. The rule is appropriately located in that definition. It is not necessary to § 5.416, which pertains to persons considered as dependents.

We also propose to change “reasonably contributes” to “provides reasonable contributions” in both paragraphs (a)(3) and (b)(2), because it is the amount of the contributions that must be reasonable, not the way that the person provides those contributions.

§ 5.417 Child Custody for Purposes of Determining Dependency for Improved Pension

We propose to move the definitions of “custody” and “legal responsibility” to proposed § 5.1, defining “custody of a child”. The remainder of this regulation contains four presumptions for determining dependency. We propose to simplify the regulation to eliminate redundancy without altering its meaning.

§ 5.420 Reporting Periods for Improved Pension

In initially proposed § 5.420, we stated, “When calculating adjusted annual income, VA counts income that is anticipated or received during a specific period, called a `reporting period.' ” We have determined that it would be helpful for readers to have a simple definition of “reporting period” so we propose to insert the following definition (based on § 3.661, the current rule regarding income reporting): “A reporting period is a time period established by VA during which a claimant or beneficiary must report to VA all income, net worth, and adjustments to income.”

We propose to revise § 5.420(a) to include that a claimant or beneficiary may report a change in income or net worth when the change occurs. The claimant or beneficiary does not have to wait until the beginning of the next reporting period to report the change. This change is consistent with current VA practice.

§ 5.422 Effective Dates of Changes to Annual Improved Pension Payment Amounts Due to a Change in Income

In paragraphs (b)(2) and (3) of initially proposed § 5.422, we used the term “required evidence” without explaining what the evidence should prove. To resolve this potential ambiguity, we propose to revise paragraph (b)(2) by replacing “required evidence” with “evidence showing the dependency”. Likewise, we propose to revise (b)(3) by replacing “required evidence” with “evidence showing the loss of a dependent”.

§ 5.423 Improved Pension Determinations When Expected Annual Income Is Uncertain

We propose to provide a definition for “expected annual income” in the first sentence of § 5.423(a). We propose to define the term as “the annual income a claimant or beneficiary anticipates receiving during a given reporting period.”

We propose to remove all references in this subpart to the term “anticipated income” and propose to replace it with “expected income”. This proposed change will be for consistency purposes.

§ 5.424 Time Limits To Establish Entitlement to Improved Pension or To Increase the Annual Improved Pension Amount Based on Income

In reviewing initially proposed § 5.424, we determined that this section can be clarified and shortened by minor reorganization and the removal of unnecessary verbiage. We propose to make these changes.

§ 5.430 Marriage Date Requirements for Improved Death Pension

Initially proposed § 5.430(a)(2)(i) referred to veterans of the Mexican Border period and World War I. We propose to remove these references because there are no longer any surviving veterans of these war periods and VA does not anticipate receiving any more Improved Death Pension claims from the surviving spouses of these deceased veterans. Moreover, if VA does receive such a claim, it could process the claim under the controlling statutes, 38 U.S.C. 103(b) and 1541(f).

We also propose to remove initially proposed § 5.430(b), which had concerned the marriage-date requirements of a surviving spouse. That paragraph was based on 38 U.S.C. 103(b), which is not limited to Improved Pension. We propose to move the rule to § 5.200, “Surviving spouse: requirement of valid marriage to veteran.”

§ 5.432 Deemed Valid Marriages and Contested Claims for Improved Death Pension

In §§ 5.432 and 5.433, we propose to delete the term “legal” as it was used in the initially proposed rule to describe a surviving spouse. Although there is no explicit definition of “legal surviving spouse” in current part 3, the term is used to denote a spouse who was legally married to the veteran at the time of the veteran's death as contrasted with a deemed valid spouse. This distinction has no legal significance in § 5.432 or § 5.433. For the same reason, we propose to delete the term “lawful” before “surviving spouse” in § 5.539.

§ 5.434 Award or Discontinuance of Award of Improved Death Pension to a Surviving Spouse Where Improved Death Pension Payments to a Child Are Involved

In initially proposed § 5.434(a)(3) we stated:

When a surviving spouse establishes eligibility for Improved Death Pension but is not entitled because his or her adjusted annual income is greater than the maximum annual pension rate or because his or her net worth bars entitlement, VA will discontinue the child's pension award effective the first day of the month after the month for which VA last paid benefits to the surviving spouse.

Consistent with current §§ 3.503(a)(9) and 3.657(b)(1), the reference to the surviving spouse at the end of § 5.434(a)(3) should refer instead to the child. We now propose to correct this error.

In addition, we propose to reorganize § 5.434(b) to improve clarity.

§ 5.435 Calculating Annual Improved Pension Amounts for a Surviving Child

In initially proposed § 5.435(a) we parenthetically defined the term “personal custodian” as “a person legally responsible for the child's support”. We propose to add a Start Printed Page 71124definition of “custody of a child” as § 5.1. Therefore, the definition initially proposed in this section is superfluous and we propose to remove it.

B. Elections of Improved Pension; Old-Law and Section 306 Pension AL83

In a document published in the Federal Register on December 27, 2004, we proposed to publish in a new 38 CFR part 5 VA regulations governing Old-Law Pension, Section 306 Pension, and elections of Improved Pension. 69 FR 77578. The title of this proposed rulemaking was “Elections of Improved Pension: Old-Law and Section 306 Pension” (RIN: AL83). The proposed regulations were based on current regulations in 38 CFR part 3, but were revised to reflect plain English and updated to reflect current practice. We provided a 60 day comment period that ended on February 25, 2005. We received submissions from two commenters.

Terminology

We mean to add the word “Pension” after “Old-Law” and “Section 306” whenever these two pension programs are mentioned together in a single sentence. For example, “Old-Law and Section 306 Pension” will be rewritten as “Old-Law Pension and Section 306 Pension.” This will help readers understand that these two pension benefits are separate and distinct programs.

For consistency purposes in describing whether particular potential sources of revenue are considered by VA in calculating a beneficiary's income or net worth, we propose to replace the word “include” with “count” (or with a commensurate substitute) and “exclude” with “does not count” (or with a commensurate substitute).

Comment Relating to a Different Portion of This Rulemaking

One commenter suggested that a rating decision that reduces a rating during a period of hospitalization should be considered void if notice of a prior rating decision had not been sent to a veteran at the veteran's latest address of record. The commenter used her husband's case as an example, stating that his 1990 reduction should be void because she alleges that VA did not provide her husband with notice of a 1971 rating decision. This comment deals with defective notice and the effect it has on the finality of decisions. Accordingly, this comment will be discussed with other comments received for RIN 2900-AL87, “General Provisions”, in subpart A of this part, which contains VA's definition of a “Final decision” in proposed § 5.1.

§ 5.461 Electing Improved Pension Instead of Old-Law Pension or Section 306 Pension

In the initially proposed rule, we proposed to include § 5.461, “Electing Improved Pension instead of Old-Law or Section 306 Pension”, in subpart F of part 5. However, upon further consideration, it would be more appropriate to place this regulation in subpart L, “Payments and Adjustments to Payments”, along with other rules on elections of veterans benefits as § 5.758. Hence, we propose to include § 5.461 in our proposed subpart L, initially published in the Federal Register on December 27, 2004. 69 FR 77578.

§ 5.472 Rating of Income for Old-Law Pension and Section 306 Pension

Initially proposed § 5.472(b)(2) defined “payments” as “cash and cash equivalents (such as goods and other negotiable instruments) . . . ” We propose to revise our definition by replacing the term “goods” with “checks”. This change is made in order to be consistent with our definition of “payments” in § 5.370(h) and § 5.531(b).

§ 5.475 Gaining or Losing a Dependent for Old-Law Pension and Section 306 Pension

For consistency purposes, we propose to revise the heading and the regulatory text in § 5.475(b)(2) by replacing “on or before December 31, 1978” with “before January 1, 1979”. This change will improve clarity in the application of effective dates and is consistent with the rest of part 5.

§ 5.477 Effective Dates of Reductions and Discontinuances of Old-Law Pension and Section 306 Pension

In § 5.477(b), we propose to delete the reference to “§§ 3.500 through 3.503” from the regulatory text and replace it with a reference to § 5.705, the part 5 regulation that lists all of the part 5 regulations governing the effective dates of reductions and discontinuances. We propose to revise the regulatory text by inserting the words “appropriate” and “as specified” in order to notify readers that the provisions in § 5.705 will indicate which effective dates, other than those stated in paragraph (a), are applicable to a particular case.

§ 5.478 Time Limit To Establish Continuing Entitlement to Old-Law Pension or Section 306 Pension

We propose to revise the regulatory text in § 5.478(a), Expected income appears to exceed income limit, by inserting the phrase “for that calendar year” after “annual income limit” and inserting the word “calendar” before “year effective January 1”. These revisions will remove ambiguity and clarify that VA measures income in calendar-year units.

Deletion of Withholding Provision, Formerly Under 38 CFR 3.260(b), Computation of Income

In addition, we note that under 38 CFR 3.260(b) (the current rule upon which § 5.478(a) is based), VA has the authority to withhold payments if that income will exceed the statutory limit. However, this withholding provision only applied to new claims for Old-Law Pension and Section 306 Pension. Since such claims have been barred by statute since 1979 (see Public Law 95-588, sec. 306(a), 92 Stat. 2508 (1978)), there is no need to include the provision in part 5.

XII. Subpart G: Dependency and Indemnity Compensation, Death Compensation, Accrued Benefits, and Special Rules Applicable Upon Death of a Beneficiary

A. Dependency and Indemnity Compensation Benefits AL89

In a document published in the Federal Register on October 21, 2005, we proposed to revise Department of Veterans Affairs (VA) regulations governing dependency and indemnity compensation (DIC) benefits, to be published in a new 38 CFR part 5. 70 FR 61326. We provided a 60-day comment period that ended December 21, 2005. We received submissions from four commenters: Disabled American Veterans, Vietnam Veterans of America, National Organization of Veterans' Advocates, and one from a member of the general public.

§ 5.500 Proof of Death

Initially proposed § 5.500 described the types of evidence VA will accept as proof of death. We propose to revise this provision to explain that, where the rule lists more than one type of evidence that VA will accept as proof of death, VA requires the first-listed type of evidence, if obtainable. If the first-listed document is not obtainable, VA will accept the next-listed type of evidence that is obtainable. This clarification reflects VA's established practice. With respect to matters that are ordinarily documented by official public records, such as death, VA's long-standing practice is to require the official records that VA considers most reliable to establish those facts, if such records are available. We believe that it is helpful to state this principle in proposed Start Printed Page 71125§ 5.500 and we propose to revise it accordingly. In accordance with its duty to assist, VA will assist claimants as necessary in seeking to obtain the types of evidence needed to establish the fact of death.

§ 5.504 Service-Connected Cause of Death

All four of the comments received concerned the provisions of initially proposed § 5.504. This proposed section defined a service-connected disability for purposes of determining entitlement to VA death benefits, and provided the rules for determining if a veteran's death is service connected. The AL89 NPRM, omitted the following sentence from 38 CFR 3.312(a), “[t]he issue involved will be determined by exercise of sound judgment, without recourse to speculation, after a careful analysis has been made of all the facts and circumstances surrounding the death of the veteran, including, particularly, autopsy reports.” This language is unnecessary in proposed § 5.504 because it mainly restates the generally applicable principle that VA decisions will be based on a review of the entire record. See 38 U.S.C. 5107(b) and 38 CFR 3.102. We have stated this in proposed § 5.4(b), “Claims adjudication polices”. Regarding avoiding “speculation”, we have stated this concept in proposed § 5.3(b)(6). Regarding the “exercise of sound judgment”, and conducting a “careful analysis”, these duties are inherent in any adjudication process and where a claimant disagrees with the judgment or analysis of a VA adjudicator, he or she may appeal the decision. We therefore believe it is unnecessary to include this language in our regulations.

One commenter was concerned with the provision in initially proposed § 5.504(b)(1)(ii) that states, “[f]or purposes of this section, VA will deem a sudden death in service from trauma to have been preceded by disability from the trauma.” This commenter stated that the sentence we initially proposed “is unnecessarily logically convoluted and restrictive, is legally insufficient, and is in fact altogether unnecessary.” He suggests as alternative language, “[f]or purposes of this section, a death in service is service-connected [sic], provided the death was in line of duty and was not due to the servicemember's own willful misconduct.”

We agree in part with the commenter's concerns. Part of this sentence is somewhat convoluted and could be read as restrictive. We propose to revise the sentence for the reasons explained in the following paragraphs.

The purpose of this sentence in the proposed rule is to preclude the interpretation that a traumatic death in service is so sudden that it does not produce a disability before death. This provision is necessary because Title 38 of the United States Code requires that to be service-connected, a death in service must result from a disability incurred or aggravated in service. “The term 'service-connected' means . . . that the death resulted from a disability incurred or aggravated, in line of duty in the active military, naval, or air service”, 38 U.S.C. 101(16). For a surviving spouse or dependent to be eligible for many VA benefits due to a servicemember's death in service, the person's death must be a result of a disability “incurred or aggravated, in line of duty in the active military, naval, or air service”. 38 U.S.C. 101(16); see also 38 U.S.C. 1310, 2307, 3500, and 3701.

We agree with the commenter that the sentence may be construed to be restrictive if not read carefully. This is due primarily to use of the words “trauma” and “sudden”. Accordingly, we propose to remove the phrases “from trauma” and “from the trauma” and the word “sudden” in the subject sentence in proposed § 5.504(b)(1)(ii).

The revised proposed sentence now reads, “[f]or purposes of this section, VA will presume that a death that occurred in line of duty was preceded by disability.” This will make clear VA's intent that the presumption applies to all deaths that occur in line of duty. We substituted “line of duty” for “in service” to reflect the requirement in 38 U.S.C. 105 and 1110 that disability must be incurred in the line of duty in order to be service connected.

Three commenters expressed concern with the provisions of initially proposed § 5.504(c), regarding service connection for the cause of death when the service-connected disability hastens death. The commenters stated that the proposed revisions in § 5.504 were more restrictive than the provisions in current 38 CFR 3.312. To avoid such a misinterpretation, we are retaining the provisions of § 3.312(c). Accordingly, we are inserting the exact wording of § 3.312(c) into proposed § 5.504(c)(2).

§ 5.510 Dependency and Indemnity Compensation—Basic Entitlement

Initially proposed § 5.510 stated that in order to be entitled to dependency and indemnity compensation a survivor of the veteran “must be otherwise qualified” for this benefit. We propose to delete the terms “otherwise qualified” and “qualified” from proposed § 5.510. To say that a survivor of a veteran must be qualified is redundant of other VA provisions that state the requirements that must be met in order to be considered a dependent of the deceased veteran.

In proposed § 5.510(b)(2), to be consistent with the Federal Register Document Drafting Handbook, page 1-19, we propose to change the order of the references to list the United States Code first. In addition, we propose to correct the authority citation at the end of proposed § 5.510.

§ 5.511 Special Monthly Dependency and Indemnity Compensation

We propose to revise initially proposed § 5.511(a) to clarify that entitlement to this benefit is determined based on whether the surviving spouse or parent needs regular aid and attendance. Determinations of the need for aid and attendance will be made under the criteria in proposed § 5.320.

§ 5.520 Dependency and Indemnity Compensation—Time of Marriage Requirements for Surviving Spouses

We propose to revise initially proposed § 5.520(b)(1)(iii) and (b)(2)(ii) by adding the words, “was born to them”