Citation Nr: 1327485 Decision Date: 08/27/13 Archive Date: 09/05/13 DOCKET NO. 08-29 713A ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in San Diego, California THE ISSUES 1. Entitlement to an initial disability evaluation in excess of 10 percent for postoperative incision, status post-surgical lung resection (hereinafter "postoperative incision"), prior to October 23, 2008; and to an evaluation in excess of 20 percent thereafter. 2. Entitlement to an effective date earlier than September 25, 2012, for the award of service connection for right intercostal neuropathy, post-thoracotomy (hereinafter "RIN"). REPRESENTATION Veteran represented by: Disabled American Veterans WITNESS AT HEARINGS ON APPEAL The Veteran ATTORNEY FOR THE BOARD A. Nigam, Counsel INTRODUCTION The Veteran served on active duty from November 1958 to November 1960, with subsequent service in the Army Reserve until 1964. This matter comes before the Board of Veterans' Appeals (hereinafter "Board") on appeal from a February 2007 rating decision, issued in March 2007 by the Department of Veterans Affairs (hereinafter "VA") Regional Office (hereinafter "RO") in San Diego, California, which granted compensation pursuant to 38 U.S.C.A. § 1151 for postoperative incision, status post-surgical lung resection, and assigned a 10 percent evaluation, effective November 29, 2002. The Veteran filed an appeal as to the initial assigned disability evaluation. In a February 2009 supplemental statement of the case (hereinafter "SSOC") and subsequent rating action, the RO increased the evaluation for postoperative incision from 10 to 20 percent, effective October 23, 2008. Applicable law mandates that when a veteran seeks an increased evaluation, it will generally be presumed that the maximum benefit allowed by law and regulation is sought, and it follows that such a claim remains in controversy where less than the maximum benefit available is awarded. See AB v. Brown, 6 Vet. App. 35 (1993). Therefore, the claim has remained on appeal. The Veteran testified at a hearing held at the RO before a Decision Review Officer (hereinafter "DRO") in January 2009, and at a videoconference hearing before the undersigned Veterans Law Judge (hereinafter "VLJ") in January 2012. Transcripts of these proceedings are of record. In August 2012, the Board remanded the case to the RO via the Appeals Management Center (hereinafter "AMC") in Washington, DC in order to obtain VA examination and medical opinion. The post-remand record shows substantial compliance with the Board's directive. See Stegall v. West, 11 Vet. App. 268 (1998); Dyment v. West, 13 Vet. App. 141 (1999). In a May 2013 SSOC, the AMC confirmed and continued the Veteran's disability ratings for the service-connected postoperative incision. Also, in a May 2013 rating decision, the AMC granted service connection for RIN, and assigned a 20 percent disability evaluation, effective September 25, 2012. In evaluating this case, the Board has not only reviewed the physical claims file, but has also reviewed the eFolder on Virtual VA (hereinafter "Virtual VA") to ensure a complete assessment of the evidence. Additional, pertinent lay and medical evidence was added to Virtual VA in October 2012 and July 2013, which was considered by the AMC in the July 2013 SSOC. Also, in July 2013, the Veteran's representative submitted a waiver of the Veteran's right to have his case remanded to the Agency of Original Jurisdiction (hereinafter "AOJ") for initial consideration. As such, the Board will proceed to consider the appeal on the merits. See 38 C.F.R. § 20.1304(c) (2012). Please note this appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2012). 38 U.S.C.A. § 7107(a)(2) (West 2002). The issue of entitlement to an effective date earlier than September 25, 2012, for the award of service connection for RIN is addressed in the REMAND portion of the decision below and is REMANDED to the RO via the AMC. FINDINGS OF FACT 1. All notification and development actions needed to fairly adjudicate the matter on appeal have been accomplished. 2. Prior to October 23, 2008, the Veteran's postoperative incision disability was manifested by a superficial, painful scar on examination. 3. Since October 23, 2008, the Veteran's postoperative incision disability has been manifested by three or four scars that are painful but not unstable. CONCLUSIONS OF LAW 1. Prior to October 23, 2008, the criteria for an assignment of an initial rating in excess of 10 percent for the service-connected postoperative incision had not been met. 38 U.S.C.A. §§ 1155, 5103, 5103A, 5107 (West 2002 and Supp. 2012); 38 C.F.R. §§ 3.102, 3.159, 3.321, 4.1-4.7, 4.25, 4.68 (2012); 4.118, including Diagnostic Code (hereinafter "Diagnostic Code" or "DC") 7804 (in effect prior to October 23, 2008). 2. Since October 23, 2008, the criteria for the assignment of a rating in excess of 20 percent for the service-connected postoperative incision have not been met. 38 U.S.C.A. §§ 1155, 5103, 5103A, 5107 (West 2002 and Supp. 2012); 38 C.F.R. §§ 3.102, 3.159, 3.321, 4.1-4.7, 4.25, 4.68 (2012), 4.118, including DC 7804 (2012). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS In this decision, the Board will discuss the relevant law which it is required to apply. This includes statutes enacted by Congress and published in Title 38, United States Code (hereinafter "38 U.S.C.A."); regulations promulgated by VA under the law and published in the Title 38 of the Code of Federal Regulations (hereinafter "38 C.F.R.") and the precedential rulings of the United States Court of Appeals for the Federal Circuit (hereinafter "Federal Circuit") (as noted by citations to "Fed. Cir.") and the United States Court of Appeals for Veterans Claims (hereinafter "Court") (as noted by citations to "Vet. App."). The Board is bound by statute to set forth specifically the issues under appellate consideration and its decision must also include separately stated findings of fact and conclusions of law on all material issues of fact and law presented on the record, and the reasons or bases for those findings and conclusions. See 38 U.S.C.A. § 7104(d); see also 38 C.F.R. § 19.7 (implementing the cited statute); see also Vargas-Gonzalez v. West, 12 Vet. App. 321, 328 (1999); Gilbert v. Derwinski, 1 Vet. App. 49, 56-57 (1990) (the Board's statement of reasons and bases for its findings and conclusions on all material facts and law presented on the record must be sufficient to enable the claimant to understand the precise basis for the Board's decision, as well as to facilitate review of the decision by courts of competent appellate jurisdiction). The Board must also consider and discuss all applicable statutory and regulatory law, as well as the controlling decisions of the appellate courts. A Veteran bears the "'evidentiary burden' to establish all elements of a claim, including the nexus requirement." Fagan v. Shinseki, 573 F.3d 1282, 1287-88 (2009). The Board's duty is to first determine the probative value of all pertinent medical and lay evidence of record based on its credibility and competency, and then weigh the probative value of the evidence regarding all material elements of a claim. See 38 U.S.C.A. § 7104(d); Kahana v. Shinseki, 24 Vet. App. 428, 433 (2011); see also Layno v. Brown, 6 Vet. App. 465, 469 (1994) (distinguishing between competency ("a legal concept determining whether testimony may be heard and considered") and credibility ("a factual determination going to the probative value of the evidence to be made after the evidence has been admitted"). A "veteran is given the 'benefit of the doubt' 'regarding any issue material' to the veteran's claim 'when there is an approximate balance of positive and negative evidence.'" Fagan, 573 F.3d at 1287 (quoting 38 U.S.C. § 5107(b)). Thus, if there is conflicting medical evidence, the Board may not ignore or disregard any medical professional's opinion, but may assign greater probative to one medical opinion over by providing an adequate statement of reasons or bases for doing so. See Owens v. Brown, 7 Vet. App. 429, 433 (1995); Willis v. Derwinski, 1 Vet. App. 66, 70 (1991). A medical opinion is most probative if it is factually accurate, fully articulated, and based on sound reasoning. See Nieves-Rodriguez v. Peake, 22 Vet. App. 295 (2008). In making all determinations, the Board must also fully weigh the probative value of the lay evidence of record against the remaining evidence of record. See King v. Shinseki, No. 2011-7159 (Fed. Cir. Dec. 5, 2012). If credible, competent lay evidence means any evidence not requiring that the proponent have specialized education, training, or experience. Lay evidence is competent if it is provided by a person who has knowledge of facts or circumstances and conveys matters that can be observed and described by a lay person. 38 C.F.R. § 3.159(a). Thus, a layperson is competent to report on the onset and continuity of his symptomatology. See Kahana, 24 Vet. App. at 438; Layno, 6 Vet. App. at 470 (a veteran is competent to report on that of which he or she has personal knowledge). Moreover, lay evidence must not be categorically dismissed as incompetent evidence of medical causation merely because it is lay evidence. See King v. Shinseki, 700 F.3d 1339, 1345 (Fed. Cir. 2012). Rather, lay evidence may be competent and sufficient evidence of a diagnosis or nexus if (1) the particular condition at issue is the type of condition that is within the competence of a layperson, (2) the layperson is reporting a contemporaneous medical diagnosis, or (3) lay testimony describing symptoms at the time supports a later diagnosis by a medical professional. See Davidson, 581 F.3d at 1316; Jandreau v. Nicholson, 492 F.3d 1372, 1376-77 (Fed. Cir. 2007); see also Kahana, 24 Vet. App. at 433, n.4. The Board must determine on a case-by-case basis whether a particular condition is the type of condition that is within the competence of a lay person. See Jandreau, 492 F.3d 1367-77; see also Kahana, 24 Vet. App. at 438, J. Lance dissenting; Robinson v. Shinseki, 312 Fed. Appx. 336, 339 (Fed. Cir. 2009) (nonprecedential). The standard of proof to be applied in decisions on claims for veterans' benefits is set forth in 38 U.S.C.A. § 5107 (West 2002). A claimant is entitled to the benefit of the doubt when there is an approximate balance of positive and negative evidence. See 38 C.F.R. § 3.102. 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 preponderance of the evidence must be against the claim for benefits to be denied. See Alemany v. Brown, 9 Vet. App. 518 (1996). Duties to Notify and Assist The Veterans Claims Assistance Act (hereinafter "VCAA") describes VA's duty to notify and assist claimants in substantiating a claim for VA benefits. 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, 5107, 5126 (West 2002); 38 C.F.R. §§ 3.102, 3.156(a), 3.159 and 3.326(a) (2012). Upon receipt of a complete or substantially complete application for benefits, VA is required to notify the Veteran and his representative, if any, of any information, and any medical or lay evidence, that is necessary to substantiate the claims. 38 U.S.C.A. § 5103(a) (West 2002); 38 C.F.R. § 3.159(b); Quartuccio v. Principi, 16 Vet. App. 183 (2002). Proper VCAA notice must inform the Veteran of any information and evidence not of record (1) that is necessary to substantiate the claims; (2) that VA will seek to provide; and (3) that the claimant is expected to provide. See 38 C.F.R. § 3.159(b)(1). With regard to notice regarding an initial evaluation following the grant of service connection, once service connection is granted, the claim is substantiated and additional VCAA notice is not required; any defect in the notice is not prejudicial. Hartman v. Nicholson, 483 F.3d 1311 (Fed. Cir. 2007); Dunlap v. Nicholson, 21 Vet. App. 112 (2007). Filing a notice of disagreement (hereinafter "NOD") begins the appellate process, and any remaining concerns regarding evidence necessary to establish a more favorable decision with respect to downstream elements (such as an effective date) are appropriately addressed under the notice provisions of 38 U.S.C.A. §§ 5104 and 7105. Goodwin v. Peake, 22 Vet. App. 128 (2008). Where a claim has been substantiated after the enactment of VCAA, the Veteran bears the burden of demonstrating any prejudice from defective VCAA notice with respect to the downstream elements. Id. There has been no allegation of prejudice with regard to the notice in this case; hence further VCAA notice is not required with regard to the initial rating appeal. Pre- and post-adjudication VCAA letters dated in March 2003, August 2004, January 2006, March 2006, April 2008, June 2008, November 2009, February 2010, April 2010, August 2012 and February 2013, collectively explained the evidence necessary to substantiate the claim, and informed the Veteran of his and VA's respective duties for obtaining evidence. These letters also explained how a disability rating is determined for a service-connected disorder and the basis for determining an effective date upon the grant of any benefit sought, in compliance with Dingess/Hartman v. Nicholson, 19 Vet. App. 473, 490-491 (2006). As noted, the claim was readjudicated in the July 2013 SSOC. Accordingly, prejudicial error in the timing or content of VCAA notice has not been established and any error is not outcome determinative. See Shinseki v. Sanders, 129 S. Ct. 1696 (2009) (reversing prior case law imposing a presumption of prejudice on any notice deficiency). Further, if any notice deficiency is present in this case, the Board finds that any prejudice due to such error has been overcome by the following: (1) based on the communications sent to the Veteran over the course of this appeal, he clearly has actual knowledge of the evidence he is required to submit in this case; and (2) based on the Veteran's contentions as well as the communications provided to him by VA, it is reasonable to expect that he understands what is needed to prevail. See Shinseki v. Sanders/Simmons, 129 S. Ct. 1696 (2009); Fenstermacher v. Phila. Nat'l Bank, 493 F.2d 333, 337 (3d Cir. 1974) ("[N]o error can be predicated on insufficiency of notice since its purpose had been served."). In order for the Court to be persuaded that no prejudice resulted from a notice error, "the record must demonstrate that, despite the error, the adjudication was nevertheless essentially fair." Dunlap v. Nicholson, 21 Vet. App. 112, 118 (2007). VA has a duty to assist veterans in obtaining evidence necessary to substantiate their claims. The claims file contains in-service and post-service medical treatment records, and reports of VA examinations and their addenda (also known in the record as a Disability Benefits Questionnaire or "DBQ") (February 2006, March 2006, September 2008, February 2010, September 2012, February 2013 and June 2013). With respect to the VA examinations, when VA undertakes to provide a VA examination or obtain a VA opinion, it must ensure that the examination or opinion is adequate. Barr v. Nicholson, 21 Vet. App. 303, 312 (2007). These VA examination reports generally reflect review of the claims file, examination of the Veteran, and description and evaluation of his scar disability. In particular, these examination findings are sufficient for proper application of the relevant rating criteria and adequate for the purpose of adjudication the issue decided hereinbelow. Additionally, as noted, this case was remanded in August 2012 to obtain VA examination and medical opinion. As noted, in February 2013 and June 2013 the Veteran underwent VA examination to determine the nature and severity of his scar disability. These examinations are adequate for VA rating purposes for the reasons articulated above. Therefore, the record shows substantial compliance with the August 2012 remand directive and no further development is required. See Stegall v. West, 11 Vet. App. 268 (1998); Dyment v. West, 13 Vet. App. 141 (1999). As noted, in January 2009, a hearing was held at the RO before a DRO, and thereafter, in June 2012, a videoconference hearing was held before the undersigned VLJ. Here, during the hearings, the VLJ and DRO noted the basis of the prior determination and noted the element of the claim that was lacking to substantiate the claim for benefits. In addition, the VLJ and DRO sought to identify any pertinent evidence not currently associated with the claims folder that might have been overlooked or was outstanding that might substantiate the claim. Moreover, neither the Veteran nor his representative have asserted that VA failed to comply with 38 C.F.R. § 3.103(c)(2), or otherwise identified any prejudice in the conduct of the hearings. By contrast, the hearings focused on the elements necessary to substantiate the claim. Overall, the hearings were legally sufficient and the duty to assist has been met. 38 U.S.C.A. § 5103A (West 2002 & Supp. 2012); Bryant v. Shinseki, 23 Vet. App. 488 (2010). The Veteran has not made the RO, the AMC or the Board aware of any additional evidence that must be obtained in order to fairly decide the claim on appeal. He has been given ample opportunity to present evidence and argument in support of his claim. Pursuant to 38 C.F.R. § 3.655, all relevant evidence necessary for an equitable disposition of the Veteran's appeal of this issue have been obtained and the case is ready for appellate review. The Board additionally finds that general due process considerations have been complied with by VA. See 38 C.F.R. § 3.103 (2012). The Merits of the Claim-Entitlement to Increased Ratings Disability ratings are determined by applying the criteria established in VA's Schedule for Rating Disabilities, which is based upon the average impairment of earning capacity. Individual disabilities are assigned separate Diagnostic Codes. 38 U.S.C.A. § 1155 (West 2002); 38 C.F.R. §§ 4.1, 4.20 (2012). When a question arises as to which of two ratings applies under a particular Diagnostic Code, the higher evaluation is assigned if the disability more nearly approximates the criteria for the higher rating; otherwise, the lower rating will be assigned. 38 C.F.R. § 4.7. Consideration must be given to increased evaluations under other potentially applicable Diagnostic Codes. Schafrath v. Derwinski, 1 Vet. App. 589, 595 (1991). After careful consideration of the evidence, any reasonable doubt remaining is resolved in favor of the Veteran. 38 C.F.R. § 4.3. Where the veteran appeals the rating initially assigned for the disability, after already having established service connection for it, VA must consider the propriety of a staged rating that is indicative of changes in the severity of the course of his disability over time. In Fenderson v. West, 12 Vet. App. 119 (1999), the Court recognized a distinction between a veteran's dissatisfaction with an initial rating assigned following a grant of service connection and a claim for an increased rating of a service-connected disorder. In the case of the assignment of an initial rating for a disability following an initial award of service connection for that disability (the circumstances of the present appeal), separate ratings can be assigned for separate periods of time based on the facts found-"staged" ratings. See Fenderson, supra, at 125-26. It is the responsibility of the rating specialist to interpret reports of examination in the light of the whole recorded history, reconciling the various reports into a consistent picture so that the current rating may accurately reflect the elements of disability present. 38 C.F.R. § 4.2 (2012). Ratings shall be based, as far as practicable, upon the average impairments of earning capacity. However, from time to time, VA will readjust this schedule of ratings in accordance with experience. To accord justice in an exceptional case in which the schedular evaluations are found to be inadequate, the Under Secretary for Benefits or the Director, Compensation and Pension Service, upon field station submission, is authorized to approve an extraschedular evaluation commensurate with the average earning capacity impairment due exclusively to the service-connected disability or disabilities. The governing norm in these exceptional cases is a finding that the case presents such an exceptional or unusual disability picture with such related factors as marked interference with employment or frequent periods of hospitalization as to render impractical the application of the regular schedular standards. 38 C.F.R. § 3.321(b)(1). Historically, the Veteran underwent an operation to the right lung at the La Jolla, California VA Medical Center (hereinafter "VAMC") in February 2001, during which he sustained a postoperative incision scar. The Veteran seeks an increased initial rating for his service-connected postoperative incision, which was rated as 10 percent disabling, prior to October 23, 2008, and 20 percent disabling, thereafter, under 38 C.F.R. § 4.118, DC 7804 (effective from the date of receipt of his NOD on October 19, 2007). The criteria for rating scars were amended effective October 23, 2008 and apply to all claims received by VA on or after October 23, 2008. On January 20, 2012, but effective retroactively to October 23, 2008, 38 C.F.R. § 4.118 was again revised to clarify that as to claims filed before October 23, 2008, the old criteria will apply to applications received by VA before that date. However, a veteran whose scars were rated by VA under a prior version of diagnostic codes 7800, 7801, 7802, 7803, 7804, or 7805 of 38 CFR 4.118, may request review under these clarified criteria, irrespective of whether his or her disability has worsened since the last review. The effective date of an increased rating award, however, will in no case be before October 23, 2008. Also, the Court has held in the past that where the law or regulation changes after the claim has been filed, but before the administrative or judicial process has been concluded, the version most favorable to the veteran applies unless Congress provided otherwise or permitted the VA Secretary to do otherwise and the Secretary did so. See Karnas v. Derwinski, 1 Vet. App. 308 (1991). The Karnas rule has, however, since been limited to some degree by a decision of the Federal Circuit as well as legal precedent of VA's General Counsel. See Kuzma v. Principi, 341 F.3d 1327 (Fed. Cir. 2003) and VAOPGCPREC 7-03. The revised statutory or regulatory provisions may not be now applied to any time period before the effective date of the change, although the former provision may be applied prospectively. See 38 U.S.C.A. § 5110(g) (West 2002); 38 C.F.R. § 3.114 (2012); VAOPGCPREC 3-2000. The RO considered the Veteran's claim under the amended criteria and in a February 2009 SSOC the Veteran was duly notified of these changes. Also, as noted, the AMC granted entitlement to an increased evaluation under the amended criteria in the February 2009 SSOC. In order to review the record in the light most favorable to the Veteran, as the applicability of the revised criteria was recently clarified, the Board will consider the rating criteria in effect prior to and as of October 23, 2008, in adjudicating this claim. Under the rating criteria in effect prior to October 23, 2008, a review of applicable rating codes indicates that the Veteran would be entitled to a rating provided under DC 7804, but that further evaluation under other diagnostic codes for rating skin disabilities is not appropriate. See Butts v. Brown, 5 Vet. App. 532 (1993) (choice of diagnostic code should be upheld if it is supported by explanation and evidence). Under prior Diagnostic Code 7804, a scar that was superficial and painful on examination could be assigned a 10 percent rating. 38 C.F.R. § 4.118, DC 7804 (in effect prior to October 23, 2008). Note (1) provides that a superficial scar is one not associated with underlying soft tissue damage. See 38 C.F.R. § 4.118, DC 7804, Note (1) (in effect prior to October 23, 2008). Note (2) provides that a 10 percent evaluation will be assigned for a scar on the tip of a finger or toe even though amputation of the part would not warrant a compensable evaluation (See §4.68 of this part on the amputation rule). See 38 C.F.R. § 4.118, DC 7804, Note (2). Prior to October 23, 2008, further evaluation under other diagnostic codes for rating skin disabilities is not appropriate. In this regard, the lay and clinical evidence did not show the Veteran had any scars of the head, face or neck, which would have entitled him to evaluation under Diagnostic Code 7800; the lay and clinical record did not show that he had any deep scars that caused limitation of motion, which would have entitled him to evaluation under Diagnostic Code 7801; the lay and clinical record did not show that he had any superficial scars of an area or areas of 144 square inches (929 sq. cm.) or greater that did not cause limited motion, which would have entitled him to evaluation under Diagnostic Code 7802; the lay and clinical record did not show that he had any superficial, unstable scars, which would have entitled him to evaluation under Diagnostic Code 7803; and the lay and clinical record did not show that he had any dermatitis or eczema, which would have entitled him to evaluation under Diagnostic Code 7806. 38 C.F.R. § 4.118 (2012). The revisions to Diagnostic Code 7804 provide for evaluations of unstable or painful scars (30 percent for five or more scars that are unstable or painful; 20 percent for three or four scars that are unstable or painful; and 10 percent for one or two scars that are unstable or painful). The notes associated with this diagnostic code were also revised (Note (1): An unstable scar is one where, for any reason, there is frequent loss of covering of skin over the scar; Note (2): If one or more scars are both unstable and painful, add 10 percent to the evaluation that is based on the total number of unstable or painful scars; and Note (3): Scars evaluated under diagnostic codes 7800, 7801, 7802, or 7805 may also receive an evaluation under this diagnostic code, when applicable). From October 23, 2008, a review of applicable rating codes reveals that the Veteran would not be entitled to any greater rating than that already provided under Diagnostic Code 7804, and that further evaluation under other diagnostic codes for rating skin disabilities is not appropriate. See Butts v. Brown, 5 Vet. App. 532 (1993) (choice of diagnostic code should be upheld if it is supported by explanation and evidence). In this regard, the lay and clinical record does not show that the Veteran has any scars of the head, face or neck, which would entitle him to evaluation under Diagnostic Code 7800; the lay and clinical record does not show that he has any deep and nonlinear scars of an area or areas of at least 12 square inches (77 sq. cm.) but less than 72 square inches (465 sq. cm.) or greater, which would entitle him to evaluation under Diagnostic Code 7801; the lay and clinical record does not show that he has any superficial and nonlinear scars, which would entitle him to evaluation under Diagnostic Code 7802; and the lay and clinical record does not show that he has any dermatitis or eczema, which would entitle him to evaluation under Diagnostic Code 7806. 38 C.F.R. § 4.118 (2012). All disabilities, including those arising from a single disease entity, are rated separately, and all disability ratings are then combined in accordance with 38 C.F.R. § 4.25 (2012). However, the evaluation of the same "disability" or the same "manifestations" under various diagnoses is not allowed. See 38 C.F.R. § 4.14. A claimant may not be compensated twice for the same symptomatology as "such a result would over-compensate the claimant for the actual impairment of his earning capacity." Brady v. Brown, 4 Vet. App. 203, 206 (1993) (interpreting 38 U.S.C.A. § 1155). This would result in pyramiding, contrary to the provisions of 38 C.F.R. § 4.14. However, if a Veteran has separate and distinct manifestations attributable to the same injury, they should be compensated under different diagnostic codes. See Esteban v. Brown, 6 Vet. App. 259 (1994); Fanning v. Brown, 4 Vet. App. 225, 230 (1993). As noted above, in the July 2013 rating decision, the AMC granted service connection for RIN, and assigned a 20 percent evaluation, effective September 25, 2012. The Board notes that the Veteran has requested an earlier effective date for the grant of this claim, which is the subject of the REMAND below. The former version of Diagnostic Code 7805 provided that other scars (not otherwise considered under the rating schedule) are to be rated on the basis of limitation of function of the affected part. The revised version of Diagnostic Code 7805 applies to other scars (including linear scars) and other effects of scars evaluated under Diagnostic Codes 7800, 7801, 7802, and 7804. A rating is to be assigned on the basis of any disabling effect(s) not considered in a rating provided under Diagnostic Codes 7800-04 under another appropriate diagnostic code. As noted in the Board's August 2012 remand what is particularly salient to the present case is that pursuant to the revised Diagnostic Code 7804, Note 3, in effect, for the time period since October 23, 2008, separate ratings are potentially assignable for the same scar sites under both Diagnostic Codes 7804 and 7805. However, as noted, the objective evidence of record indicates that the Veteran's impairment of function due to pain is due to the Veteran's thoracotomy and resulting RIN, and not due to the Veteran's post-surgical scars. Thus, any additional or alternative rating under either the former or current version of Diagnostic Code 7805 would not be in order. See, e.g., 38 C.F.R. § 4.14. Thus, the Veteran's separately evaluated neurological impairment will not be addressed in this decision. Consideration of factors wholly outside the rating criteria constitutes error as a matter of law. Massey v. Brown, 7 Vet. App. 204, 207-08 (1994). The Board finds that the evidence of record prior to October 23, 2008, indicates the Veteran would have been entitled to no more than a 10 percent evaluation for the postoperative incision, under the criteria for rating the skin prior to October 23, 2008. In this regard, VA treatment records indicate that the Veteran underwent a right upper lobectomy in February 2001. In April 2001, the Veteran reported that his activities of daily living were within normal limits but with pain. He could walk approximately 1 mile per day and was able to ascend and descend stairs, as well as drive with some difficulty. He was also able to attend post-operative physical therapy at that time. A VA pulmonary clinic note, dated in April 2001, shows observation of a well-healed thoracotomy scar, mildly tender to palpation along the lateral and inferior margin. The Veteran was assessed with slowly resolving incisional discomfort. A November 2001 VA anesthesia pain clinic note indicates the Veteran complained of pain in the right lower ribcage area since his surgery, which occurred with activity and was intermittent, tight and stiff. The Veteran was observed to have no weakness, slight numbness, no redness and no swelling at the site, and the VA anesthesiologist opined that the Veteran's pain was likely muscular in origin, exacerbated only by activity. A March 2002 VA pulmonary clinic note reveals findings of an erythematous macular rash on the middle of the chest over hair, and serpiginous borders, consistent with candida, but all other skin normal, and examination of the chest included findings of right thoracotomy scar, well-healed, no tenderness to palpation. Subsequent VA and private treatment records, dated from 2001 to 2008, generally reflect complaints of post-thoracotomy neurogenic rib pain, worse with activity; however, they show physical findings of no more than a well-healed thoracotomy scar, rib tenderness and intercostal nerve damage. A private treatment record from "Dr. Licht" includes findings of a scar on the thorax at about T6 with pain slightly below that area from the mid-axilla to the back. The Veteran was assessed with complaints of pain which appeared to be in a dermatomal distribution and slightly below the area of incision for removal of his right lung tumor. A VA Form 21-4138, Statement in Support of Claim, dated in August 2004, shows that the Veteran complained of nerve damage since his operation, with pain at a level 7 on a scale of 1 to 10. He reported that he had to quit his job because of his pain, and that no medication appeared to help. A statement from the Veteran's representative, dated in January 2005, reflects report that the Veteran had pain in his chest wall, and that his entire wound was tender to palpation. On VA examination in February 2006, the Veteran complained of pain felt mainly on the right side of the chest or the scar tissue, more on the lateral aspect in the axillary region rather than the front or the back of the chest. Pain was described as constant and dull, occurring from morning until night. The Veteran denied that deep breathing, coughing or sneezing increased his pain, although sometimes walking, standing and bending were uncomfortable. When asked what activity was limited by his pain, the Veteran reported that heavy labor, heavy lifting, standing for more than 5 minutes and walking for more than half a mile would make him uncomfortable. The site of the pain was exactly on the operative scar, which was sensitive rather than numb. There was no numbness or tingling described, and pain did not radiate from the front to the back, or in any intercostal nerve distribution, but instead remained on the site of the incision. On physical examination, a scar on the right chest wall, about T9 intercostal location from the back to the front of the nipple line was observed. The examiner noted that the scar was well-healed, without redness, swelling or keloid formation. The examiner also noted that at times the scar could barely be seen from a distance; however, the Veteran was sensitive to touch over the scar. On sensory examination, there was hypersensitivity, or increased sensitivity, to touch and pinprick over the scars, more so in the axillary line, lateral aspect of the right chest wall observed, in spite of there being no signs of inflammation over the scars. On review of the medical records, the Veteran's operative notes were reviewed and they mentioned no complication. There was no addition to the intercostal area. Post-operatively, incisional sensitivity of the scar was noted and slowly resolving as of April 2001. The condition was noted to have persisted and the Veteran was sent to physical therapy for the months of April and May 2001. The Veteran also received two cortisone injections for his pain, and was prescribed ointment and medication to treat his pain. The VA examiner diagnosed the Veteran with a postoperative incisional discomfort and pain persisting for the last 5 years. The examiner opined that the Veteran's pain was not an intercostal nerve root distribution, but was on the skin and directly related to the incision and the scar tissue just under the skin. The examiner noted there was no keloid formation, and therefore, there was no real cause for his pain, except that the area had remained sensitive since surgery. In September 2008, the Veteran underwent a second VA examination to evaluate his scars. Here, the Veteran reported that his surgical scar was intermittently painful, but tolerable initially, although he had constant pain at a 10 out of 10 level the previous two years. He complained that the pain at the surgical scar and the surrounding skin required him to take multiple medications with no significant improvement of pain. He noted that he retired from his employment at the U.S. Postal Service in 2003, and had difficulty enjoying recreational activities such as fishing because he could not reel in the fish he caught. No other symptoms or limitations were described. On physical examination, the examiner observed a 34 centimeter slightly depressed scar, which wrapped around the right-sided thorax, and two other 4 centimeter scars just below the larger one. The Veteran reported pain with palpation over the scars and a large area of skin above and below the scars. The examiner observed the scars were slightly shiny, superficial, and slightly depressed without adherence to the underlying tissue. There was no inflammation, edema or kelodial formation. The scars were near skin color, there was no limitation or inflexibility of the skin in the area of the scars, and they were non-disfiguring. The Veteran was diagnosed with three residual scars from open lung surgery for right lobectomy. The residual scars were tender to palpation. The Veteran also reported tenderness to palpation in a large area of the skin surrounding the scars. Finally, the scars were non-disfiguring. The clinical record is highly probative as to the Veteran's subjective reports that he experienced recurrent pain in the area of his scar. They were generated with a view towards ascertaining the Veteran's then-state of physical fitness and are akin to a statement of diagnosis or treatment. Rucker v. Brown, 10 Vet. App. 67, 73 (1997) (observing that although formal rules of evidence do not apply before the Board, recourse to the Federal Rules of Evidence may be appropriate if it assists in the articulation of the reasons for the Board's decision); see also LILLY'S: AN INTRODUCTION TO THE LAW OF EVIDENCE, 2nd Ed. (1987), pp. 245-46 (many state jurisdictions, including the federal judiciary and Federal Rule 803(4), expand the hearsay exception for physical conditions to include statements of past physical condition on the rational that statements made to physicians for purposes of diagnosis and treatment are exceptionally trustworthy since the declarant has a strong motive to tell the truth in order to receive proper care). Also, the Board has duly considered the Veteran's personal statements and hearing testimony, and finds him to be uniquely suited to describe the nature and severity of his service-connected postoperative incision disability. He is certainly competent to describe symptoms of chronic painful scars, and the Board finds his testimony credible as to his skin symptomatology. See 38 C.F.R. § 3.159(a)(2); Falzone v. Brown, 8 Vet. App. 398 (1995); Heuer v. Brown, 7 Vet. App. 379 (1995). Hence, the Board accords these statements high probative value as to the degree of severity of the scar disability, especially as they pertain to the Veteran's descriptions of painful flare-ups in the scars. The Court has recognized that some conditions, by their inherent nature, wax and wane and accordingly are sometimes active and other times not. See Ardison v. Brown, 6 Vet. App. 405, 408 (1994). The Board notes that at no point during this period of the appeal did the Veteran report or the clinical record show that he experienced more than superficial, post-surgical painful scar on examination, which is consistent with the assigned 10 percent rating under DC 7804. Thus, applying the regulation cited above, the Veteran would only be entitled to an initial evaluation of 10 percent for the postoperative incision under 38 C.F.R. § 4.118, DC 7804 (in effect prior to October 23, 2008). In this regard, his scars have been characterized as slightly depressed, superficial, slightly shiny, without adherence to the underlying tissue, near skin color, without limitation or inflexibility of the skin in the area of the scars, and they were non-disfiguring. Moreover, the scars were not of an area or areas that exceeded 12 square inches and were not deep, which would entitle him to a 20 percent evaluation under 38 C.F.R. § 4.118, DC 7801. Hence, the Veteran's claim for an increased initial evaluation in excess of 10 percent for the postoperative incision, for the period prior to October 23, 2008, will be denied. The provisions of 38 U.S.C.A. § 5107(b) regarding reasonable doubt are not applicable, and his claim must be denied for this period of the appeal. See 38 U.S.C.A. § 5107(b); 38 C.F.R. § 3.102; Alemany v. Brown, 9 Vet. App. 518, 519 (1996). Additionally, for the period since October 23, 2008, the Board finds that the Veteran's postoperative incision disability has been manifested by three or four scars that are painful but not unstable. In this regard, during the Veteran's January 2009 DRO hearing testimony, he reported having a scar from his chest wall to the end of his back, which was tender and caused him continuous pain. He also reported experiencing fatigue in his arm when putting away dishes, bowling and fishing, related to his scar, but later indicated that the functional impairment he experienced was related to his trapezius muscle, and not to his scar. He described nerve damage that continued from his chest wall through his back, but otherwise had no other symptoms but continuous pain in the chest. When asked about the presence of any skin irritation, the Veteran denied experiencing any dry, flaky, scaly, red skin, and reiterated that his main symptoms were neurological and pain related. In October 2009, the Veteran submitted a statement in which he reported that his lung resection left him with permanent damage and pain, which had nothing to do with his scars. He also reported that his hobbies used to be bowling, playing ping pong and tennis, and fishing, but that he was unable to fish because of the residuals of his surgery. In February 2010, the Veteran underwent a VA respiratory diseases examination. Here, the examiner noted that the Veteran had postoperative scars on the right chest that caused a great deal of pain and markedly limited his routine activities and employment. The Veteran reported that he had to stop working in 2003 because of the pain resulting from the surgical thoracic scar. On physical examination, the examiner observed the scar on the right chest measured 30 centimeters by 1 centimeter, and 30 centimeters by 2 centimeters. The scar was described as extremely sensitive and painful, but there was no skin breakdown and the scar was superficial. There were no limitations of motion or apparent limitations of function caused by the scar, but there was limitation because of the pain. No inflammation, edema, and keloid formation were noted, and the scar was of the same color as the adjacent skin. The Veteran was diagnosed with a post-thoracotomy scar with intense pain, marked hyperesthesia and a marked limitation of function. A VA treatment record, dated in May 2012, shows the Veteran was observed to have 3 scars on the right posterior/lateral torso, which he identified as causing him significant pain. The first scar measured 29.5 centimeters and wrapped from his right scapula around to his mid-axillary line. The second scar measured 3.5 centimeters and ran parallel and below the first scar, around the mid-axillary line. The third scar measured 3.5 centimeters and ran anterior to the second scar along the same line, parallel to scar number one. All three scars were described as pearly white, and thin. Another VA treatment record dated in May 2012 reflects observations of a 29.5 centimeter diagonal scar on the right torso and back, and 2, 3.5 centimeter scars parallel to it. All three scars were characterized as hypertrophic. During his July 2012 Board hearing, the Veteran testified that his pain was exclusively due to nerve damage and not due to his surgical scars. In fact, he denied having any symptoms associated with his scars whatsoever, and contended that his problems have been related to nerve damage all along. He reported that his nerve damage impaired his ability to work and to recreate, and caused him to be in chronic pain. He also reported that his pain impaired his movement. In a September 2012 VA examination, the Veteran was observed to have hypersensitivity to light touch below his right thoracotomy scar, affecting the region of approximately the seventh and eighth intercostal nerves. However, there was no absence of light touch or pinprick sensation. In February 2013, the Veteran underwent a VA scars examination. Here, he was noted to have one painful surgical scar of the right hemithorax; however, the examiner noted that most of the pain appeared to be internal and related to an intercostal neuralgia. The examiner indicated the Veteran did have hyperesthesia over the scar of the right hemithorax. The scar was not observed to be unstable, painful and unstable, or due to burns, and did not cause limitation of function. It was observed to be linear and 26 centimeters by .1 centimeters in length. The examiner noted that the Veteran had significant post-thoracotomy pain, which impacted his ability to work. The examiner noted that this impairment was more likely due to the Veteran's neuropathic chest wall pain. In June 2013, the Veteran underwent another VA examination, in which the examiner reported that the Veteran did not have a skin disorder, and only had a scar related to his thoracotomy. For the second period of the appeal, there is no evidence of record to show that the Veteran's postoperative incision is manifested by three scars that are more than painful on examination. 38 C.F.R. § 4.118, DC 7804 (2012). In this regard, the scars are not deep and nonlinear, and of an area or areas of at least 12 square inches (77 square centimeters) but less than 72 square inches (465 square centimeters), which would entitle him to an evaluation in excess of 20 percent under 38 C.F.R. § 4.118, DC 7801 (2012). In fact, by the Veteran's own admission, his scars are not painful, and his condition is manifested by neurological symptoms resulting in significant functional impairment and not skin symptoms; thus, the preponderance of the evidence is against the claim. The provisions of 38 U.S.C.A. § 5107(b) regarding reasonable doubt are not applicable, and his claim must also be denied for this period of the appeal. See 38 U.S.C.A. § 5107(b); 38 C.F.R. § 3.102; Alemany v. Brown, 9 Vet. App. 518, 519 (1996). Extraschedular Considerations Generally, the degrees of disability specified in the rating schedule are considered adequate to compensate for considerable loss of working time from exacerbations or illnesses proportionate to the severity of the several grades of disability. 38 C.F.R. § 4.1. Schedular ratings are based primarily upon the average impairment in earning capacity, that is, upon the economic or industrial handicap which must be overcome and not from individual success in overcoming it. 38 C.F.R. § 4.15. To afford justice in exceptional situations, however, an extraschedular rating may also be assignable. 38 C.F.R. § 3.321(b). The Board may not, in the first instance, assign an increased rating on an extraschedular basis, but may determine whether referral for extraschedular consideration is warranted, provided that it articulates the reasons or bases for that determination. See Bagwell v. Brown, 9 Vet. App. 337, 339 (1996). This determination follows a three-step inquiry. See Thun v. Peake, 22 Vet. App. 111, 115 (2008). The threshold factor for extraschedular consideration is a finding that the evidence before VA presents such an exceptional disability picture that the available schedular evaluations for that service-connected disability are inadequate. Therefore, initially, the level of severity and symptomatology of a veteran's service-connected disability must be compared with the established criteria found in the rating schedule for that disability. Id. If the rating criteria reasonably describe a veteran's disability level and symptomatology, the disability picture is contemplated by the rating schedule. Therefore, the assigned schedular evaluation is adequate and no referral is required. Id. If the schedular evaluation does not contemplate the level of disability and symptomatology, and is found inadequate, the second step of the inquiry requires the Board to determine whether the exceptional disability picture exhibits other related factors such as marked interference with employment or frequent periods of hospitalization. Id. at 115-16. The first two steps should be undertaken by comparing the disability picture of each service-connected disability with the criteria in the rating schedule for that disability. The Board should compare the service-connected disability picture with the criteria in the rating schedule for that disability. Johnson v. Shinseki, --- Vet. App. ----, 2013 WL 1224810, Vet. App., March 27, 2013 (NO. 10-1785). Extraschedular consideration is undertaken on the basis of each individual service-connected disability. Based on this disability-by-disability approach, the Board is not required to consider whether a veteran is entitled to referral for extraschedular consideration of his service-connected disabilities on a collective basis. Id. If analysis of the first two steps shows that the rating schedule is inadequate to evaluate the disability picture and that picture shows the related factors discussed above, the final step requires that the disability be referred to the Under Secretary for Benefits or the Director of the Compensation and Pension Service for a determination of whether the disability picture requires the assignment of an extraschedular rating. Thun, 22 Vet. App. 111. Here, the rating criteria reasonably describe the Veteran's scar symptomatology, and provide for consideration of greater disability and symptoms than currently shown by the evidence. It is noted that the symptoms listed in the rating criteria are exhaustive and not demonstrative; see 38 C.F.R. § 4.118. Overall, the impairment caused by the Veteran's postoperative incision, as described above, is accounted for by the rating criteria. Thus, the assigned schedular evaluation is adequate. See Thun v. Peake, 22 Vet. App. 111, 115 (2008). Consequently, referral for extraschedular consideration is not warranted. Entitlement to a total disability rating based on individual unemployability (hereinafter "TDIU"), is an element of all appeals of an increased rating. Rice v. Shinseki, 22 Vet. App. 447 (2009). However, the record shows the Veteran is currently in receipt of a TDIU rating, effective September 25, 2012, which is the date that the Veteran's combined disability rating was 70 percent and the date he was found to be unemployable on VA examination; and that prior to that date he did not meet the criteria for a TDIU evaluation pursuant to 38 C.F.R. § 4.16. Thus any development or consideration under Rice is therefore not appropriate. ORDER Prior to October 23, 2008, an initial rating in excess of 10 percent for the service-connected postoperative incision is denied. Since October 23, 2008, a rating in excess of 20 percent for the service-connected postoperative incision is denied. REMAND With regard to the claim of entitlement to an effective date earlier than September 25, 2012, for the award of service connection for RIN, service connection was granted by a May 2013 rating decision of the AMC, and an evaluation of 20 percent, effective September 25, 2012, was assigned. In July 2013, the Veteran's representative submitted what may reasonably be construed as an NOD with respect to the May 2013 rating decision, and specifically appealed the effective date assigned. Accordingly, the Board finds that the July 2013 statement from the Veteran's representative constitutes a timely NOD with the effective date assigned for service connection and the 20 percent rating for RIN. 38 C.F.R. § 20.201 (2012). The filing of an NOD initiates the appeal process. Godfrey v. Brown, 7 Vet. App. 398 (1995). The RO/AMC has not provided the Veteran with a statement of the case (hereinafter "SOC") with respect to the earlier effective date claim. 38 C.F.R. § 19.26 (2011). Where an NOD has been filed with regard to an issue, and an SOC has not been issued, the appropriate Board action is to remand the issue for issuance of an SOC. Manlincon v. West, 12 Vet. App. 238 (1999). Accordingly, the case is REMANDED for the following action: (Please note, this appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2012). Expedited handling is requested.) The RO/AMC must issue an SOC on the issue of entitlement to an effective date earlier than September 25, 2012, for the award of service connection for RIN. If the Veteran perfects an appeal, the RO/AMC must return the case to the Board. The Veteran has the right to submit additional evidence and argument on the matter 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 38 U.S.C.A. §§ 5109B, 7112 (West Supp. 2012). ______________________________________________ S. L. Kennedy Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs