Citation Nr: 1327606 Decision Date: 08/28/13 Archive Date: 09/05/13 DOCKET NO. 02-06 288 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Waco, Texas THE ISSUE Entitlement to accrued benefits for expenses paid by the appellant in connection with the Veteran's last sickness. WITNESS AT HEARING ON APPEAL Appellant ATTORNEY FOR THE BOARD Elizabeth Jalley, Counsel INTRODUCTION The appellant is the son of the Veteran, who served on active duty from July 1940 to October 1945 and from April 1951 to June 1966. This case is before the Board of Veterans' Appeals (Board) on appeal from a rating decision in April 2001 by a Regional Office (RO) of the Department of Veterans Affairs (VA). A notice of disagreement was received in July 2001, a statement of the case was issued in April 2002, and a substantive appeal was timely received in May 2002. In May 2003, the appellant appeared at a hearing before the undersigned Veterans Law Judge. A transcript of the hearing is in the record. A review of the Virtual VA paperless claims processing system does not reveal any additional documents pertinent to the present appeal. This claim arises from the appellant's October 2000 filing of a VA Form 21-601, "Application for Reimbursement from Accrued Amounts Due to a Deceased Beneficiary." This application appears to have been filed by the appellant in his capacity as the executor of his father's estate. This claim was essentially to recoup the retroactive special monthly compensation benefits that were awarded to the Veteran in a May 15, 2000, rating decision on the date of his death. The benefits at issue were sought pursuant to either 38 U.S.C.A. § 5121 or 5122. 38 U.S.C.A. § 5121 provides for the payment of accrued benefits, which are defined as "unpaid periodic monetary benefits authorized under laws administered by VA to which a veteran was entitled at death," to eligible beneficiaries. 38 U.S.C.A. § 5122, which applies only to payments received but not negotiated by a payee prior to the payee's death, allows for the payment of such benefits to be made to the estate of the decreased payee unless the estate will escheat. In its November 2003 decision, the Board determined that the benefit payment at issue here was not made to the Veteran prior to his death, and thus the provisions of section 5122 were inapplicable. See Wilkes v. Principi, 16 Vet. App. at 242-43. The November 2003 Board decision also denied the appellant's claim for certain accrued benefits under 38 U.S.C.A. § 5121 based on the determination that the Veteran's spouse pre-deceased him, none of his children bore the expenses of his last sickness, none of his children are in the class of eligible payees enumerated at 38 U.S.C.A. § 5121(a)(2-5), and although the appellant paid $8,386.75 in expenses to the funeral home for the Veteran's burial, VA paid him $1500.00, which was the maximum award of burial benefits at the time of the Veteran's death. The appellant appealed the Board's decision to the United States Court of Appeals for Veterans Claims (Court). In a May 2006 Order, the Court "ORDERED that the November 17, 2003, decision of the Board be MODIFIED to include a determination that [the appellant] is an accrued benefits beneficiary pursuant to 38 U.S.C. § 5121(a)(6) to the extent that such accrued benefits are available." It set aside the Board's denial of the accrued benefits claim and remanded the matter to the Board for further development. In that decision, the Court determined that "given the Board's finding with regard to [the appellant's] incurring funeral expenses, he is an accrued benefits beneficiary as a matter of law." It further noted that the Secretary had determined that the Veteran had incurred funeral expenses in the amount of $8,386.75 and was thus owed $6,836.75 [sic] in addition to the $1,500.00 that he had already been paid; however, the Court noted that "the Board has not made any determinations as to the amount of benefits that have accrued or the amount due to [the appellant], and the Court cannot made such determinations in the first instance." The Board notes that the May 2006 Court Order did not disturb the Board's November 2003 determination that the Veteran's estate was not entitled to retroactive special monthly compensation benefits under 38 U.S.C.A. § 5122. Therefore, the question of whether the Veteran's estate is entitled to those benefits can no longer be considered by the Board. The only remaining questions thus concerned the amount of accrued benefits to which the appellant was personally entitled. In February 2007, the Board remanded the matter to give the appellant an opportunity to submit documentation that establishes that he bore the medical expenses associated with the Veteran's last sickness. In June 2007, the appellant's former attorney submitted copies of billing statements and cancelled checks. An accrued benefit in the amount of $6,886.75 was authorized to the appellant in September 2007 based upon his having paid funeral/burial expenses (funeral expenses of $8,386.75 less the prior VA burial allowance of $1,500 already paid to the appellant). In September 2007, the appellant, through his former attorney, argued that he was entitled to an amount above $6,886.75. In a supplemental statement of the case issued later the same month, the RO denied entitlement to accrued benefits in excess of $6,886.75. In a February 2008 decision, the Board found that the evidence failed to show that the appellant bore any of the expenses of the Veteran's last sickness or burial, other than the burial expenses already authorized and reimbursed. The appellant again appealed the Board's decision to the Court. An October 2009 single-judge Memorandum Decision held that the appellant's argument for payment of awarded but unpaid special monthly compensation benefits failed. Specifically, the Court noted that: Disability compensation awarded but not paid due to the death of an awardee generally is payable only to accrued beneficiaries pursuant to 38 U.S.C. § 5121; Zevalkink v. Brown, 102 F.3d 1236, 1242 (Fed. Cir. 1996). Pursuant to section 5121, full benefits due a veteran but not paid as a result of the veteran's death may be paid only to the spouse, minor children, or dependent parents of the veteran. Absent such status, accrued benefits may be paid only to reimburse the expenses of last sickness and burial. 38 U.S.C. § 5121(a)(6). In this instance, [the appellant] does not contend - and nothing in the record supports a contention - that he qualifies as an accrued beneficiary under section 5121 other than to the extent he incurred expenses of last sickness and burial of his father. Accordingly, the Court expressly found that the appellant "fail[ed] to demonstrate that the Board erred by not awarding him full payment of the [special monthly compensation] awarded to his father, but not paid due to his death." The Court added, however, that the appellant's implicit argument that the Board failed to explain the basis for its limited assessment of the expenses associated with the Veteran's last sickness was supported by the record. The Court found that the Board failed to make any finding with regard to whether the Veteran died from an acute illness and when any such illness began. The Board also failed to determine whether the Veteran's illness began in April 1997, which is the effective date for special monthly compensation based on the need for regular aid and attendance. The Court set aside the Board February 2008 decision, remanding for further adjudication. Judgment was entered in November 2009. This case was again remanded in August 2010, and again in April 2012, for the purpose of addressing the concerns raised by the Court in the October 2009 Memorandum Decision. The subsequent development will be discussed in more detail below. FINDINGS OF FACT Verifiable expenses totaling $7,147.38 have been paid by the appellant in connection with the Veteran's last sickness. CONCLUSION OF LAW Payment to the appellant of accrued benefits totaling $7,147.38, but no more, for expenses paid by the appellant in connection with the Veteran's last sickness is warranted. 38 U.S.C.A. § 5121 (West 2002 & Supp. 2012); 38 C.F.R. § 3.1000 (2012). REASONS AND BASES FOR FINDINGS AND CONCLUSION I. Veterans Claims Assistance Act The Veterans Claims Assistance Act of 2000 (VCAA), Public Law No. 106-475, 114 Stat. 2096 (2000), substantially amended the provisions of chapter 51 of title 38 of the United States Code, concerning the notice and assistance to be afforded to claimants in substantiating their claims. VCAA § 3(a), 114 Stat. 2096, 2096-97 (2000) (now codified as amended at 38 U.S.C.A. §§ 5103, 5103A (West 2002 & Supp. 2012)). In addition, VA published regulations, which were created for the purpose of implementing many of the provisions of VCAA. See 66 Fed. Reg. 45,620 (Aug. 29, 2001) (now codified, in pertinent part, at 38 C.F.R. § 3.159 (2012)). The notice requirements of the VCAA require VA to notify the claimant of any evidence that is necessary to substantiate a claim, as well as the evidence VA will attempt to obtain and which evidence the claimant is responsible for providing. Quartuccio v. Principi, 16 Vet. App. 183 (2002). As discussed in the Board's February 2007 remand of this case, the appellant has been repeatedly advised that only so much of the accrued benefits may be paid as may be necessary to reimburse the person who bore the expense of the Veteran's last sickness and burial. 38 U.S.C.A. § 5121(a)(1-5) (West 2002); 38 C.F.R. § 3.1000(a) (2012). On several occasions, VA specifically requested that the appellant submit evidence showing that he paid the expenses of the Veteran's last sickness, and explained to him the importance of doing so. Acknowledging the appellant's expressed confusion over what he was required to submit, the Board remanded this claim in February 2007 with the following instruction: Request that the appellant submit documentation which establishes that he bore the medical expenses associated with the veteran's last sickness. Such documentation may include, but is not limited to, canceled checks, money orders, bank account records, account statements, etc. The appellant should be reminded that he is entitled to receive only so much of any accrued benefits available as is necessary to reimburse him for the medical or burial expenses he incurred on the veteran's behalf. Regarding each loan/line of credit referenced by the appellant and his attorney, the appellant should provide a copy of a duly executed loan agreement or promissory note showing the terms of repayment as well as the party financially liable for the debt. The appellant should also provide documentation showing the current status of each loan/line of credit and the source of funding used to make the loan payments (i.e., whether the payments were made with income from the veteran or the appellant). The appellant should be reminded that his claim can not be granted unless he provides documentation showing that he paid the expenses of the veteran's last sickness. This notice was mailed to the appellant in April 2007. A report of contact from that same month reflects that this notice was also faxed to the appellant. The Board thus finds that the notice provisions of VCAA were fulfilled in this case. The duty to assist requirements have also been fulfilled in this case, as the appellant was given a personal hearing before the undersigned in May 2003. The Board notes that the information that is required in this case consists of the appellant's personal financial records, and no assistance from VA in obtaining any such records is allowed in that respect. The evidence of record provides sufficient information to adequately evaluate the claim. Therefore, no further assistance to the appellant with the development of evidence is required, nor is there notice delay or deficiency resulting in any prejudice to the appellant. 38 U.S.C.A. § 5103A(a)(2); 38 C.F.R. § 3.159(d); see Mayfield v. Nicholson, 19 Vet. App. 103 (2005), rev'd on other grounds, 444 F.3d 1328 (Fed. Cir. 2006). II. Analysis The appellant has claimed entitlement to benefits due and unpaid upon the death of the Veteran pursuant to 38 U.S.C.A. § 5121(a) and 38 C.F.R. § 3.1000(a). The appellant's claim is based on his assertion that he bore the expenses of the Veteran's last sickness. 38 C.F.R. § 3.1000(a)(5). (The Board notes that, to the extent that the appellant has claimed entitlement under the same regulation to reimbursement for burial expenses that he incurred in connection with the Veteran's burial, benefits totaling the claimed amount of $8,386.75 have already been paid. The remaining questions in the adjudication at hand solely involves the expenses that were incurred by the appellant in connection with the Veteran's last sickness.) It has been established by the record that the Veteran and the appellant owned a joint bank account. As the joint owner of the account, the appellant himself has been deemed to have paid any expenses that were paid in connection with the Veteran's last sickness, as long as such payments are verified to have been made from the joint bank account. The Board notes that the VA Adjudication Procedures Manual, M21-1MR (M21-1MR) (Manual Rewrite) reflects that, for the purposes of adjudicating claims for reimbursement, "[t]he term last illness means the period from the onset of the acute attack causing death up to the date of death. If death resulted from a lingering or prolonged illness instead of an acute attack, the period of last illness is considered to have begun at the time the person became so ill as to require the regular and daily attendance of another person." M21-1MR, Part V, Subpart I, Chapter 3, Section D, para. 15.b. As noted above, the Court's October 2009 Memorandum Decision directed that the Board determine whether the Veteran died from an acute illness and, if so, when the illness began, or whether his illness began in April 1997, which is the effective date for special monthly compensation based on the need for regular aid and attendance. In October 2012, a medical opinion was obtained in response to the October 2009 Memorandum Decision in which, following a review of the claims file, the examiner rendered the following opinion: Although the sepsis syndrome was the terminal event causing this veteran's death, it was most likely caused by his chronic medical condition of paraplegia and loss of use of bladder and bowel. Therefore, the veteran's death was most likely due primarily to his underlying chronic medical disability, terminated by the acute event of sepsis. In light of the above opinion, the Board has determined that the appropriate effective date of the Veteran's last illness is April 1, 1997. The M21-1MR contains provisions relative to the allowance of items of expense in connection with a claim for reimbursement under 38 U.S.C.A. § 5121(a)(6). M21-1MR, Part VIII, Chapter 4, para. 12. The Manual specifically lists physician expenses, medicinal expenses, and nursing expenses. M21-1MR, Part VIII, Chapter 4, para. 12(b)-(d). The Manual provides that payment of accrued benefits, as reimbursement, is not limited to specific items or amounts; that consideration is to be given to all reasonable expenses incident to last illness and burial; and that only those charges which are clearly shown not to be related to the beneficiary's last illness are to be disallowed. M21-1MR, Part VIII, Chapter 4, para. 12(a), (g) (emphasis in original.) The Manual further provides that claims for reimbursement must generally be supported by bills; provided, however, that bills covering the cost of medicines are not required if the claimant alleges that the medicine was paid for in cash and it is apparent that the amount claimed is reasonable and consistent with the character and duration of the last illness. M21-1MR, Part VIII, Chapter 4, para. 12(c). The Court has specifically held that non-medical expenses are to be excluded from reimbursement under the relevant provisions. Caranto v. Brown, 4 Vet. App. 516, 518 (1993). The Court has also held that 38 U.S.C.A. § 5121 places the burden on the claimant to produce the evidence necessary for VA to determine whether an award from accrued benefits may be properly made, and that it is within VA's discretion to require an appellant to submit receipts to substantiate payment prior to granting a claimant's application. Id. at 519. In the case at hand, the appellant has submitted invoices and/or cancelled checks demonstrating that payment was made from his and the Veteran's joint bank account to the following payees: Doughtery's Pharmacy; Preferred Home Care; Preferred Visiting Nurses; Preferred Top Quality; the Veteran; Principal Residential Mortgage; Bank One; Denke + Associates, PLLC; VISA Platinum Providian; First Card; and Fleet. Payments were also made to a furniture store and an individual for repair and maintenance to the Veteran's house. Of these, the Board finds that the payments made to financial institutions and for home repair and maintenance are not reimbursable, as the invoices that have been added to the record do not demonstrate that any of the payments that were made on these accounts were for medical expenses. Nor are some of the payments to the Veteran himself reimbursable to the extent that there is no indication that these checks were used for medical expenses. Thus, the Board will only consider the checks and invoices from Doughtery's Pharmacy; Preferred Home Care; Preferred Visiting Nurses; and Preferred Top Quality. While most of the invoices of record have corresponding cancelled checks, the Board notes that three do not. However, judging from the dates on which the services were rendered, it appears that none of these invoices is accounted for with a corresponding cancelled check. Given that these records make it apparent that the bills were paid for with checks from the appellant and Veteran's joint bank account, the Board has decided to resolve reasonable doubt in the appellant's favor and grant reimbursement of those expenses. The following check numbers and payment amounts correspond to reimbursable payments to the above payees: Check Number Check Date Payee Amount 2355 08/09/1999 Dougherty's Pharmacy $309.40 2359 08/17/1999 Preferred Home Care $320.00 2370 08/30/1999 Dougherty's Pharmacy $378.61 2388 10/08/1999 Dougherty's Pharmacy $550.60 2399 11/01/1999 Dougherty's Pharmacy $291.68 2404 11/05/1999 Veteran (glasses) $506.00 2415 12/02/1999 Dougherty's Pharmacy $243.20 2445 12/16/1999 Preferred Home Care $427.50 2452 01/03/2000 Dougherty's Pharmacy $229.87 2468 01/31/2000 Preferred Visiting Nurses $520.50 2478 02/17/2000 Preferred Visiting Nurses $292.50 2489 03/09/2000 Preferred Visiting Nurses $352.50 2493 03/27/2000 Preferred Visiting Nurses $195.00 2499 04/03/2000 Dougherty's Pharmacy $324.00 2509 04/26/2000 Preferred Visiting Nurses $495.00 2518 05/08/2000 Dougherty's Pharmacy $243.64 2530 06/23/2000 Preferred Visiting Nurses $510.00 The following invoices correspond to reimbursable payments to the above payees: Account Date(s) of Service Payee Amount 05/25/2000 Dougherty's Pharmacy $191.30 HA992 01/29/1999, 01/30/1999 Preferred Top Quality $196.00 HA993 02/10/1999 to 02/14/1999 (paid 02/19/1999) Preferred Top Quality $570.00 When added up, these two charts result in medical expenses that are eligible for reimbursement under 38 U.S.C.A. § 5121 totaling $7,147.38. Therefore, the Board finds that accrued benefits reimbursement for expenses paid by the appellant in connection with the Veteran's last sickness totaling $7,147.38 is warranted. ORDER Entitlement to accrued benefits for expenses paid by the appellant in connection with the Veteran's last sickness totaling $7,147.38 is granted. ____________________________________________ DEBORAH W. SINGLETON Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs