Citation Nr: 0503754 Decision Date: 02/11/05 Archive Date: 02/22/05 DOCKET NO. 03-34 793 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Seattle, Washington THE ISSUES 1. Entitlement to an effective date earlier than May 5, 2001, for the grant of service connection for Type II diabetes mellitus secondary to Agent Orange exposure in service. 2. Entitlement to an initial evaluation in excess of 20 percent for Type II diabetes mellitus. REPRESENTATION Appellant represented by: The American Legion WITNESS AT HEARING ON APPEAL Appellant ATTORNEY FOR THE BOARD W. Sampson, Counsel INTRODUCTION The veteran had active duty from September 1964 to September 1968. This matter comes before the Board of Veterans' Appeals (Board) on appeal from an April 2003 rating decision by the Department of Veterans Affairs (VA) Regional Office (RO) in Seattle, Washington, which granted service connection for Type II diabetes mellitus secondary to Agent Orange exposure in service, and assigned a 20 percent evaluation effective May 5, 2001. The veteran disagreed with the assignment of the effective date, and the level of disability assigned. See Fenderson v. West, 12 Vet. App. 119, 125-26 (1999) (citing AB v. Brown, 6 Vet. App. 35, 38 (1993)). In October 2004, the veteran submitted directly to the Board additional medical evidence consisting of an October 2004 medical opinion. See 38 C.F.R. § 20.1304 (regarding submission of new evidence not considered by the agency of original jurisdiction following certification to Board) The veteran waived initial RO consideration of the newly submitted evidence. In June 2004, a videoconference hearing was held before the undersigned Veterans Law Judge making this decision who was designated by the Chairman to conduct that hearing, pursuant to 38 U.S.C.A. § 7107(c) (West 2002). A transcript of that hearing is of record. The issue of entitlement to an increased initial rating for Type II diabetes mellitus is addressed in the REMAND portion of the decision below and is REMANDED to the RO via the Appeals Management Center (AMC), in Washington, DC. FINDINGS OF FACT 1. The veteran had qualifying service in Vietnam, and a medical diagnosis of Type II diabetes mellitus. 2. The veteran filed a claim for service connection for diabetes on June 14, 1971 which was denied by the RO in July 1971. He did not appeal this denial. 3. The veteran filed a reopened claim for service connection for diabetes, to include Type II diabetes mellitus, on September 3, 1987. This claim was pending before VA on May 3, 1989. 4. The medical evidence is evenly balanced as to whether the veteran had Type II diabetes mellitus on September 3, 1987. 5. Service connection was granted for Type II diabetes mellitus, secondary to Agent Orange exposure, in April 2003. CONCLUSION OF LAW The criteria for an effective date of September 3, 1987, for the grant of service connection for Type II diabetes mellitus, secondary to Agent Orange exposure in service, have been met. 38 U.S.C.A. §§ 1110, 1116, 5110 (West 2002); 38 C.F.R. § 3.400, 3.816 (2004). REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veterans Claims Assistance Act In November 2000, the Veterans Claims Assistance Act of 2000 (VCAA), was signed into law. 38 U.S.C.A. § 5100 et seq; 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326(a) (2004). This law eliminated the concept of a well-grounded claim, redefined the obligations of VA with respect to the duty to assist, and imposed on VA certain notification requirements. Without deciding whether the notice and development requirements of VCAA have been satisfied in the present case, it is the Board's conclusion that this does not preclude the Board from adjudicating the appellant's claim for an earlier effective date for service connection for Type II diabetes mellitus, secondary to Agent Orange exposure in service. This is so because the Board is taking action favorable to the veteran; a decision at this point poses no risk of prejudice to the veteran. See, e.g., Bernard v. Brown, 4 Vet. App. 384 (1993); VAOPGCPREC 16-92, 57 Fed. Reg. 49,747 (1992). Background The veteran had service in Vietnam from December 1966 to January 1968. He was discharged in September 1968. In June 1971, he filed a claim for service connection for diabetes. He submitted a June 1971 statement from a private physician, J. Davis, M.D., stating that the veteran was first seen in April 1971 with classic symptoms of diabetes mellitus. The diagnosis was diabetes mellitus, onset age 23. In July 1971, the RO denied service connection for diabetes. The RO noted that the evidence did not show that the veteran had received treatment for diabetes during service, and it was not recorded in the report of his examination at the time of his discharge. The veteran did not appeal this determination. On September 3, 1987, the veteran filed another claim for service connection for diabetes. In a February 1988 VA endocrinology examination, the veteran was diagnosed with longstanding Type I diabetes. His family history was negative for diabetes. He was wearing an injection pump with the injection site in the left lower quadrant of the abdomen. The veteran indicated that he had been told during his discharge examination that he had sugar in his urine, but nothing was done at the time. In a March 1988 statement, the veteran requested an Agent Orange screening, noting that he had been in an area in Vietnam where the water was contaminated by defoliant spraying. The RO again denied service connection for diabetes, and the veteran appealed this determination to the Board. In a June 1990 decision, the Board noted that service connection was not warranted for diabetes mellitus because it was not demonstrated in service or within a year thereafter. In November 1990, the veteran requested that his claim for service connection for diabetes mellitus as a residual of Agent Orange exposure be reopened. In a December 1990 VA examination, the diagnosis was diabetes mellitus, juvenile onset, using insulin via insulin pump. The RO denied service connection for diabetes mellitus as a result of Agent Orange exposure in a September 1994 rating decision. That decision noted that diabetes mellitus had been diagnosed in 1991. VA private and outpatient treatment records continued to show treatment for diabetes mellitus, identified as Type I. In August 2001, the veteran filed a claim for service connection for diabetes mellitus due to Agent Orange exposure. The RO obtained a medical opinion in December 2001 consisting of a review of the claims file without examination of the veteran. The opinion was that the veteran's diabetes mellitus was Type I and not Type II. Service connection was denied in January 2002. The RO noted that Type I diabetes mellitus was not subject to service connection under the provisions of the Agent Orange Act. The veteran disagreed with this rating decision, arguing that the medical records showed that his diabetes mellitus was actually Type II. The veteran submitted an April 2002 note from his VA treating physician indicating that the veteran had elevated C-peptide which was consistent with Type II diabetes, rather than Type I. The RO referred this note back to the VA physician, Dr. S. Hunt, who rendered the April 2002 opinion for further review. The physician reviewed the claims file and the case with a staff endocrinologist. He wrote in October 2002 that C-peptide was not an established way of distinguishing Type I from Type II diabetes. It was his opinion that the veteran's diabetes was at least as likely as not Type I diabetes and not Type II diabetes. The RO returned the opinion for further clarification, noting that recent outpatient treatment records showed a diagnosis of Type II diabetes mellitus where older records only showed Type I diabetes mellitus. Dr. Hunt reviewed the records and, after discussing the case again with the endocrinologist, wrote in an April 2003 opinion that the veteran had elements of both Type I and Type II diabetes. In April 2003, the RO granted service connection for Type II diabetes mellitus associated with herbicide exposure. The effective date of the grant of service connection was May 8, 2001, one year prior to the day Type II diabetes mellitus was added to the list of Agent Orange disorders. The veteran disagreed with the effective date, as well as the level of disability assigned. In a September 2003 notice of disagreement, he wrote that his effective date should be 1971, when he filed his initial claim for service connection for diabetes mellitus. The RO explained that at the time of his initial claim, there was no evidence of Type II diabetes mellitus, only Type I. His Type II diabetes mellitus only manifested many years later. In his November 2003 substantive appeal, the veteran argued that he had always had Type II diabetes mellitus, but was misdiagnosed. In February 2004, the RO solicited another medical opinion. The VA examiner reviewed the claims file including the treatment records and noted that there were no blood tests performed during service to reflect blood sugar values. However, from the medical records, it appeared that his diabetes started sometime in late 1969 or 1970, but before that he could have had some blood sugar increase. His subsequent medical studies showing diabetic ketoacidosis, very low C-peptide levels and hypoglycemic episodes, all show that he had a situation requiring insulin, namely Type I diabetes mellitus. He noted further that his opinion, as an endocrinologist, was that the veteran had Type I diabetes mellitus, requiring insulin, which started early in life, and that it should be service connected as Type I, not Type II diabetes. Another VA examination was scheduled for May 2004. This examination was scheduled primarily to evaluate the veteran's current level of disability. The assessment was Type II diabetes mellitus, poorly controlled. In a June 2004 personal hearing, the veteran argued that his initial claim for service connection for diabetes was for Type II diabetes mellitus. The veteran's representative argued for the granting of service connection for diabetes effective one of two dates, either the original claim of June 14, 1971, resulting in a denial to which the veteran admittedly did not file a notice of disagreement, or September 3, 1987, the date of his reopened his claim, pursuant to 38 C.F.R. § 3.816 and the Nehmer decision. The veteran submitted a private medical opinion in October 2004 by a private physician, A. Gordon, M.D, who indicated that she had reviewed the veteran's claim file and medical records. She noted that there were distinct differences between Type I and Type II diabetes mellitus; however, there were some challenges in attempting to separate the two conditions. She described Type I diabetes mellitus as characterized generally by childhood onset, and after five years, C-peptide concentrations were undetectable because of destruction of pancreatic cells where insulin is produced. On the other hand, with Type II diabetes mellitus, insulin resistance is a primary factor, with onset generally in adults. Treatment is not absolutely dependent on insulin, but such treatment could be brought on by stress, or in addition to oral agents for improved glycemic control. In the veteran's case, he was diagnosed at age 23 and immediately started on insulin, with oral agents not introduced until 2000 "when it was determined that he indeed had [Type II diabetes mellitus] and not [Type I diabetes mellitus] based on elevated C-peptide levels. One would expect to find in 2000, an undetectable level of C-peptide if he indeed had [Type I diabetes mellitus] for 29 years." Therefore, it was her conclusion that it was "at least more likely than not" that the veteran's condition diagnosed in 1971 was Type II diabetes mellitus. Service Connection and Agent Orange VA regulations provide that, if a veteran was exposed to an herbicide agent during active service, presumptive service connection is warranted for Type II diabetes mellitus, as a result of herbicide exposure if the requirements of 38 C.F.R. § 3.307(a)(6) are met. 38 C.F.R. § 3.309(e). The governing law provides that a "veteran who, during active military, naval, or air service, served in the Republic of Vietnam during the period beginning on January 9, 1962, and ending on May 7, 1975 shall be presumed to have been exposed during such service to an herbicide agent . . . unless there is affirmative evidence to establish that the veteran was not exposed to any such agent during that service." 38 U.S.C.A. § 1116(f). Effective Dates A specific claim in the form prescribed by the Secretary must be filed in order for benefits to be paid to any individual under the laws administered by VA. 38 C.F.R. § 3.151(a). The term "claim" or "application" means a formal or informal communication in writing requesting a determination of entitlement or evidencing a belief of entitlement, to a benefit. 38 C.F.R. § 3.1(p). The effective date of an evaluation and award of compensation or dependency and indemnity compensation will be the day following separation from service or the date entitlement arose if the claim is received within one year after separation from service; otherwise, the date of receipt of the claim or the date entitlement arose, whichever is later. 38 U.S.C.A. § 5110(a); 38 C.F.R. § 3.400. However, 38 U.S.C.A. § 5110(g) provides an exception to § 5110(a) in cases where an award of compensation or dependency and indemnity compensation is granted pursuant to a liberalizing law: Subject to the provisions of section 5101 of this title, where compensation, dependency and indemnity compensation, or pension is awarded or increased pursuant to any Act or administrative issue, the effective date of such award or increase shall be fixed in accordance with the facts found but shall not be earlier than the effective date of the Act or administrative issue. In no event shall such award or increase be retroactive for more than one year from the date of application or the date of administrative determination of entitlement, whichever is earlier. 38 U.S.C.A. § 5110(g). The Board notes that the general rule regarding the effective date of an evaluation and award is the date of receipt of the claim or the date entitlement arose, whichever is later. 38 C.F.R. § 3.400. However, retroactive effective dates are allowed in the context of a liberalizing issue. 38 U.S.C.A. § 5110(g); 38 C.F.R. § 3.114(a). The Nehmer Decision In May 1989, the United States District Court for the Northern District of California voided all denials of Agent Orange claims based on the regulations that became effective on September 25, 1985. Nehmer v. United States Veterans' Administration, 712 F. Supp. 1404, 1409 (N.D. Cal. 1989) (Nehmer I). The district court later clarified its ruling, holding that the covered claims were those in which the disease or cause of death was later found to be service connected under valid VA regulations. Nehmer v. United States Veterans' Administration, 32 F. Supp. 2d 1175, 1183 (N.D. Cal. 1999) (Nehmer II). In May 1991, the United States government and the plaintiffs in the Nehmer litigation entered into a stipulation according to which VA would readjudicate claims the denials of which were voided by Nehmer I. Nehmer v. United States Veterans' Administration, No. CV-86-6160 (TEH) (N.D. Cal. May 17, 1991) (Nehmer Stipulation). The effective date of any resulting award of benefits would be based on the filing date of the original claim, for claims originally filed before May 3, 1989 (Stipulation 1), or on the later of the filing date of the claim or the date of disability or death of the veteran, for claims filed after May 3, 1989 (Stipulation 2). See Williams v. Principi, 310 F.3d 1374, 1375-76 (Fed. Cir. 2002). The Nehmer stipulations were later incorporated into a final regulation, 38 C.F.R. § 3.816, that became effective on September 24, 2003. That regulation defines a "Nehmer class member" to include the Vietnam veteran who has a covered herbicide disease, to include Type II diabetes mellitus. 38 C.F.R. § 3.816(b)(1)(i),(2)(i). The regulation further provides that where a "Nehmer class member" is entitled to disability compensation for a covered herbicide disease, and the claim was pending before VA on May 3, 1989, the effective date of the award will be the later of the date such claim was received by VA or the date the disability arose. 38 C.F.R. § 3.816(c)(2). That regulation further states that a claim will be considered a claim for compensation for a particular covered herbicide disease if: (i) The claimant's application and other supporting statements and submissions may reasonably be viewed, under the standards ordinarily governing compensation claims, as indicating an intent to apply for compensation for the covered herbicide disability; or (ii) VA issued a decision on the claim, between May 3, 1989 and the effective date of the statute or regulation establishing a presumption of service connection for the covered disease, in which VA denied compensation for a disease that reasonably may be construed as the same covered herbicide disease for which compensation has been awarded. 38 C.F.R. § 3.816(c)(2). Otherwise, the effective date of the award is determined in accordance with 38 C.F.R. §§ 3.114 and 3.400. 38 C.F.R. § 3.816(c)(4). Analysis As noted above, the medical records show that the veteran has a current diagnosis of Type II diabetes mellitus, and he had verified service in Vietnam, and is therefore presumed exposed to Agent Orange in service. As such, service connection is warranted for Type II diabetes mellitus under the presumptive Agent Orange regulations. 38 C.F.R. § 3.307(a)(6); 38 C.F.R. § 3.309(e). This also qualifies the veteran as a Nehmer class member for application of the effective date rules of 38 C.F.R. § 3.816. The next question is whether there was a prior claim for compensation for Type II diabetes mellitus which was denied between September 15, 1985, and May 8, 2001. If so, under Nehmer the effective date of benefits is the date of the earlier claim, or the date the disability arose. The RO determined that the June 1990 Board decision, which denied service connection for diabetes mellitus, was not a prior decision on Type II diabetes mellitus and therefore Nehmer does not apply. The Board does not agree. First, with regard to the diagnosis of the veteran's disability, there is competent medical evidence stating that the veteran's initial diagnosis of diabetes mellitus was Type I diabetes mellitus, and conflicting but equally competent medical evidence showing that he actually had Type II diabetes mellitus, which was misdiagnosed. The evidence is at least evenly balanced as to the diagnosis and onset of the veteran's diabetes. A veteran is entitled to the benefit of the doubt when there is an approximate balance of positive and negative evidence. 38 C.F.R. § 3.102 (2004). When a claimant seeks benefits and the evidence is in relative equipoise, the claimant prevails. See Gilbert v. Derwinski, 1 Vet. App. 49 (1990). The Board therefore accepts the veteran's contention that his current Type II diabetes mellitus is the same diabetes mellitus he has had since his initial diagnosis. Next, the Board notes that to support a retroactive effective date under Nehmer, the prior claim must have been for the same disability that was the basis for the later award of benefits, and the evidence supports that it was. Although the June 1990 decision denied service connection for diabetes mellitus on a direct basis, it is only necessary that the prior claim be for the same disability. It is not required that the veteran have asserted that his diabetes mellitus was caused by herbicide exposure, only that it involved a disability later subject to service connection under the Agent Orange regulations. As noted above, where a "Nehmer class member" is entitled to disability compensation for a covered herbicide disease, and the claim was pending before VA on May 3, 1989, the effective date of the award will be the later of the date such claim was received by VA or the date the disability arose. 38 C.F.R. § 3.816(c)(2). In this case, the claim which was pending before VA on May 3, 1989 (and which later resulted in the June 1990 Board decision) was received at the RO on September 3, 1987. Having already given the veteran the benefit of the doubt regarding the onset of his Type II diabetes mellitus, the effective date of his award is the date of receipt of his reopened claim, or September 3, 1987. This is the earliest possible date for the award of service connection. A date retroactive to the date of his initial claim of June 14, 1971 is not possible. As noted above, this claim resulted in a denial of benefits in July 1971. Although the veteran was informed of this decision as well as his appeal rights, he did not initiate an appeal and the decision became final. 38 U.S.C. § 4005(c) (1970); 38 C.F.R. §§ 3.104, 19.118, 19.153 (1971). Finally, the Board notes that although the veteran has previously argued for an earlier effective date to the date of his initial claim in June 1971, the veteran's representative specifically requested in the June 2004 personal hearing an effective date of September 3, 1987, in the alternative. As such, this award results in a full grant of the benefits sought on appeal, at least with regard to the question of an earlier effective date. ORDER An effective date of September 3, 1987, for the award of service connection for Type II diabetes mellitus secondary to Agent Orange exposure in service is granted. REMAND In the rating decision on appeal, the RO granted service connection for Type II diabetes mellitus and assigned a 20 percent rating. In effect, the 20 percent rating was an initial rating award. When an initial rating award is at issue, a practice known as "staged" ratings may apply. That is, at the time of an initial rating, separate ratings can be assigned for separate periods of time based on the facts found. Fenderson v. West, 12 Vet. App. 119 (1999). However, this decision having granted an earlier effective date for the grant of service connection for Type II diabetes mellitus, the issue of an increased initial rating now encompasses a much longer period dating from September 3, 1987, a period during which the VA revised its regulations with respect to rating disabilities of the endocrine system, including diabetes. 61 Fed. Reg. 20,440 (May 6, 1996). Those changes became effective May 6, 1996. (codified as amended at 38 C.F.R. § 4.119, DC 7913 (2004)). The RO has not considered the veteran under the rating criteria in effect prior to May 5, 2001, to include the changes which became effective May 6, 1996. In determining whether a particular statute or regulation may be applied to a pending case, it must first be determined whether the statute or regulation itself addresses that issue. If the statute or regulation is silent, it must be determined whether applying the new provision to claims that were pending when it took effect would produce genuinely retroactive effects. Generally, if applying the new provision would produce such retroactive effects, VA should not apply the new provision to the claim. If applying the new provision would not produce retroactive effects, the new provision must be applied. Kuzma v. Principi, 341 F.3d 1327 (Fed. Cir. 2003); VAOPGCPREC 7-2003. The veteran has not been notified of the rating criteria in effect prior to the most recent revision. This must be done, and the veteran reevaluated under all applicable criteria, and in accordance with applicable regulations and law. Therefore, this case is REMANDED for the following: 1. Ensure compliance with VCAA with regard to the issue of an increased initial rating for Type II diabetes mellitus, effective September 3, 1987. 2. Readjudicate the issue of an increased initial rating for Type II diabetes mellitus, to include the possibility of "staged" ratings under Fenderson. If the benefits sought on appeal are not granted to the veteran's satisfaction, he and his representative must be furnished a Supplemental Statement of the Case and afforded an opportunity to respond. Thereafter, if in order, the case should be returned to the Board for further appellate action. The appellant has the right to submit additional evidence and argument on the matter or matters the Board has remanded. Kutscherousky v. West, 12 Vet. App. 369 (1999). This claim must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board of Veterans' Appeals or by the United States Court of Appeals for Veterans Claims for additional development or other appropriate action must be handled in an expeditious manner. See The Veterans Benefits Act of 2003, Pub. L. No. 108-183, § 707(a), (b), 117 Stat. 2651 (2003) (to be codified at 38 U.S.C. §§ 5109B, 7112). ______________________________________________ JEFF MARTIN Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs