Citation Nr: 1328838 Decision Date: 09/10/13 Archive Date: 09/17/13 DOCKET NO. 10-14 529 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in Nashville, Tennessee THE ISSUES 1. Entitlement to restoration of a 30 percent disability rating (evaluation) for xerotic eczema, to include the propriety of the reduction for the period from January 1, 2011. 2. Entitlement to a higher initial disability rating (evaluation), in excess of 0 percent, for xerotic eczema for the rating period from September 20, 2002 to November 14, 2008. 3. Entitlement to an increased disability rating, in excess of 0 percent, for allergic rhinitis. 4. Entitlement to service connection for depression. REPRESENTATION Appellant represented by: Disabled American Veterans WITNESS AT HEARING ON APPEAL The Veteran (Appellant) ATTORNEY FOR THE BOARD Christine C. Kung, Counsel INTRODUCTION The Veteran, who is the appellant in this case, served on active duty from April 1979 to February 1980. This matter comes on appeal before the Board of Veterans' Appeals (Board) from December 2008, October 2010, and August 2012 rating decisions of the Department of Veterans Affairs (VA) Regional Office (RO) in Nashville, Tennessee. The relevant procedural history shows that, in an October 2008 rating decision, the RO granted service connection for xerotic eczema and assigned a 0 percent rating from September 20, 2008. In December 2008, the RO granted an earlier effective date for service connection due to clear and unmistakable error, and assigned a 0 percent rating for xerotic eczema from September 20, 2002. In March 2009, the RO granted a higher 30 percent rating for xerotic eczema for the period from November 14, 2008, thus creating an initial staged rating. In April 2009 and May 2009, the Veteran filed a timely notice of disagreement to the denial of a higher initial rating for xerotic eczema prior to November 14, 2008, though the notice of disagreement was expressed in the terms of disagreement with the "effective date" for the grant of a 30 percent rating for xerotic eczema. In a May 2009 rating decision, the RO denied a rating in excess of 0 percent for the period prior to November 14, 2008, also erroneously expressing the adjudication as one for an earlier effective date for the evaluation for xerotic eczema. The Board remanded the case in September 2009 so the RO could issue a statement of the case addressing the appeal for a higher initial rating (which had been characterized as an earlier effective date) in excess of 30 percent for xerotic eczema, for the initial rating period prior to November 14, 2008. See Manlincon v. West, 12 Vet. App. 238 (1999). This was accomplished, and the Veteran perfected the appeal in March 2010. The Board finds, therefore, that it may proceed with a decision at this time. See Dyment v. West, 13 Vet. App. 141, 146-47 (1999) (remand not required under Stegall v. West, 11 Vet. App. 268 (1998), where the Board's remand instructions were substantially complied with), aff'd, Dyment v. Principi, 287 F.3d 1377 (Fed. Cir. 2002). The Veteran has asserted that a higher initial rating than 0 percent is warranted prior to November 14, 2008. The Veteran has expressed disagreement with the initial rating in terms of an earlier effective date claim and, more recently, clear and unmistakable error (CUE), though it is neither. Because the Veteran has appealed the initial staged rating assigned for xerotic eczema prior to November 14, 2008, the Board finds that the current appeal is for a higher initial disability rating, in excess of 0 percent, for xerotic eczema for the rating period from September 20, 2002 to November 14, 2008. Accordingly, the Board has recharacterized the issue as such. The Board finds that the Veteran has not been prejudiced by the recharacterization of the issue on appeal as the Board is granting the full benefit sought by the Veteran, specifically, a 30 percent evaluation for the initial rating period from September 20, 2002 to December 1, 2008. The Board finds that, while the Veteran and representative contend during a February 2010 DRO hearing, and in a February 2013 statement that there was "clear and unmistakable error" in granting a 0 percent rating from September 20, 2002, because the December 2008 rating decision was not final at the time of the allegation of CUE, it is not the appropriate subject of a motion for revision or reversal on the basis of CUE. Motions for CUE can only be brought against final decisions. 38 C.F.R. § 3.104(a) (2012); see also 38 U.S.C.A. § 7105(c) (West 2002). For these reasons, the Board finds that the Veteran's more recent allegations of earlier effective date and CUE, though never a claim, are moot. The Veteran testified before two different Veterans Law Judges at a June 2009 Board videoconference hearing at the RO with the Veterans Law Judge in Washington, D.C. and a May 2012 Board personal hearing in Nashville, Tennessee (Travel Board). The hearing transcripts have been associated with the claims file. Veterans Law Judges who conduct hearings must participate in making the final determination of the claim involved. 38 U.S.C.A. § 7107(c) (West 2002); 38 C.F.R. § 20.707 (2012). By law, appeals can be assigned only to an individual Veterans Law Judge or to a panel of not less than three members. See 38 U.S.C.A. § 7102(a) (West 2002). Accordingly, a third Veterans Law Judge has been assigned to the panel decision in this case. The United States Court of Appeals for Veterans Claims (Court) has held that, under 38 C.F.R. § 20.707, an appellant must be provided the opportunity for a hearing before all three Veterans Law Judges involved in a panel decision; however, during the May 2012 Travel Board hearing, the Veteran stated that she did not want a third hearing in this case. See Arneson v. Shinseki, 24 Vet. App. 379 (2011). As such, the Board finds that there is no additional development or hearing required under Arneson. As the Board will discuss in more detail below, during the May 2012 Travel Board hearing, the Veteran and her representative specified that the grant of a 30 percent rating from September 20, 2002 to December 1, 2008, and the restoration of a 30 percent rating from January 1, 2011, would fully satisfy the Veteran's appeal. The Veteran was already in receipt of a 30 percent evaluation for xerotic eczema for the initial rating period from November 14, 2008 to December 31, 2010; thus, the Board's grant of a 30 percent rating for xerotic eczema, for the period from September 20, 2002 to November 14, 2008 and from January 1, 2011 (restoration) is a full grant of the benefits sought on appeal. This case is distinguishable from A.B. v. Brown, 6 Vet. App. 35 (1993) because, in this case, the Veteran has expressly stated that she is only seeking a 30 percent rating for the relevant rating periods on appeal. The issues of entitlement to an increased disability rating for allergic rhinitis and service connection for depression are addressed in the REMAND portion of the decision below and are REMANDED to the RO via the Appeals Management Center (AMC) in Washington, DC. FINDINGS OF FACT 1. The RO complied with the procedural requirements for reducing the Veteran's disability rating for xerotic eczema on January 1, 2011, to include providing proper notification of the proposal to reduce the disability rating, and giving the Veteran the opportunity to submit evidence. 2. The evidence of record, lay and medical, did not disclose material improvement in service-connected xerotic eczema warranting the reduction of the 30 percent rating from January 1, 2011. 3. For the entire rating period from September 20, 2002 to November 14, 2008, and from January 1, 2011, xerotic eczema has been manifested by chronic, recurrent outbreaks affecting at least 20 percent but not more than 40 percent of the entire body. 4. For the entire rating period, from September 20, 2002 to November 14, 2008, and from January 1, 2011, xerotic eczema was treated with topical therapy and treatment did not approximate constant or near-constant use of systemic therapy during any 12-month period. CONCLUSIONS OF LAW 1. The reduction of the 30 percent rating for xerotic eczema, from January 1, 2011 was procedurally proper. 38 U.S.C.A. §§ 1155, 5107 (West 2002 & Supp. 2010); 38 C.F.R. §§ 3.105(e), 3.343, 3.344, 4.1-4.14, 4.118 (2012). 2. Resolving reasonable doubt in the Veteran's favor, for the period from January 1, 2011, the criteria for a restoration of a 30 percent disability rating for xerotic eczema have been met. 38 U.S.C.A. §§ 1155, 5107 (West 2002); 38 C.F.R. §§ 3.105(e), 3.343, 3.344, 4.3, 4.7, 4.40, 4.45, 4.59, 4.69, 4.118, Diagnostic Code 7806 (2012). 3. Resolving reasonable doubt in the Veteran's favor, for the period from September 20, 2002 to November 14, 2008, the criteria for an initial disability rating of 30 percent for xerotic eczema, but no higher, have been met. 38 U.S.C.A. §§ 1155, 5107 (West 2002 & Supp. 2011); 38 C.F.R. §§ 4.3, 4.7, 4.118, Diagnostic Code 7806 (2012). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS Duties to Notify and Assist The Veterans Claims Assistance Act of 2000 (VCAA) and implementing regulations imposes obligations on VA to provide claimants with notice and assistance. 38 U.S.C.A. §§ 5102, 5103, 5103A, 5107, 5126 (West 2002 & Supp. 2011); 38 C.F.R. §§ 3.102, 3.156(a), 3.326(a) (2012). In the present case, the Board is granting a higher initial 30 percent rating for service-connected xerotic eczema for the rating period from September 20, 2002 to December 1, 2008 and is restoring a 30 percent rating from January 1, 2011. The Veteran and her representative have stipulated that a grant of such benefits would fully satisfy the appeal for a higher initial disability rating and for the restoration of the 30 percent rating from January 1, 2011. Therefore, this decision constitutes a full grant of the benefits sought on appeal, and no further discussion regarding VCAA notice or assistance duties is required. Propriety of the Reduction In May 2010, the RO proposed decreasing the Veteran's disability rating for xerotic eczema from 30 percent to 0 percent. The Veteran was notified of the RO's intent to reduce the 30 percent evaluation in a May 2010 letter and proposed rating decision. The provisions of 38 C.F.R. § 3.105(e) allow for the reduction in the evaluation of a service-connected disability when warranted by the evidence, but only after following certain procedural guidelines. The regulations provide that the RO must issue a rating action proposing the reduction and setting forth all material facts and reasons for the reduction. The veteran must then be given 60 days to submit additional evidence and request a predetermination hearing. If a hearing is not requested or the veteran requests a predetermination hearing but fails to appear without good cause and reduction is considered to be still warranted, a rating action will be taken to effectuate the reduction. The effective date of the reduction will be the last day of the month in which a 60 day period from the date of notice to the veteran of the final action expires. 38 C.F.R. § 3.105(e), (i)(2) (2012). The Board finds that the RO complied with the procedural requirements for reducing the Veteran's disability rating for xerotic eczema, to include providing proper notification of the proposal to reduce the disability rating and giving the Veteran the opportunity to submit evidence. The Veteran was notified of the RO's intent to reduce the 30 percent evaluation for xerotic eczema in May 2010. The Veteran was afforded an opportunity to have a predetermination hearing and was given at least 60 days in which to present additional evidence. 38 C.F.R. § 3.105(e), (i). Final action to reduce the 30 percent evaluation to 0 percent was taken pursuant to 38 C.F.R. § 3.105(e) and the Veteran was informed of this decision in October 2010. The reduction was made effective beginning January 1, 2011. Based on a review of this procedural history, the Board finds that the RO complied with all of the requirements of 38 C.F.R. § 3.105(e). The Veteran was notified of her rights, and was given an opportunity for a hearing and time to respond. Finally, the reduction was made effective no sooner than permitted by current law and regulations ("the last day of the month in which a 60-day period from the date of notice to the beneficiary of the final action expires"). 38 C.F.R. § 3.105(e). For these reasons, the Board finds that the reduction of a 30 percent rating for xerotic eczema to 0 percent was procedurally proper. As such, the Board will address the propriety of the reduction on its merits. Disability Rating Laws and Regulations Disability ratings are determined by applying the criteria set forth in VA's Schedule for Rating Disabilities. The percentage ratings are based on the average impairment of earning capacity and individual disabilities are assigned separate diagnostic codes. 38 U.S.C.A. § 1155; 38 C.F.R. § 4.1. If two evaluations are potentially applicable, the higher evaluation will be assigned if the disability picture more nearly approximates the criteria required for that evaluation; otherwise, the lower rating will be assigned. 38 C.F.R. § 4.7. Any reasonable doubt regarding a degree of disability will be resolved in favor of the veteran. 38 C.F.R. § 4.3. The Veteran has challenged the initial disability rating assigned to her service-connected disability by seeking appellate review. Fenderson v. West, 12 Vet. App. 119, 125-26 (1999) (noting distinction between claims stemming from an original rating versus increased rating). Separate ratings may be assigned for separate periods of time based on the facts found, a practice known as "staged" rating. Fenderson, 12 Vet. App. at 126. Because the Veteran is only appealing the initial rating assigned for xerotic eczema prior to November 14, 2008 and the reduction of a 30 percent rating from January 1, 2011, the Board will evaluate the level of disability from September 20, 2002 to November 14, 2008, and from January 1, 2011. As the Board will discuss in more detail below, symptoms related to xerotic eczema have not changed in severity over the course of the appeal to warrant a staged rating. Under Diagnostic Code 7806 (dermatitis or eczema), a 0 percent evaluation is assigned with less than 5 percent of the entire body or less than 5 percent of exposed areas affected, and; no more than topical therapy required during the past 12-month period; a 10 percent evaluation is assigned where there is involvement of at least 5 percent, but less than 20 percent, of the entire body, or at least 5 percent, but less than 20 percent, of exposed areas affected, or; intermittent systemic therapy such as corticosteroids or other immunosuppressive drugs required for a total duration of less than six weeks during the past 12-month period. A 30 percent evaluation requires involvement of 20 to 40 percent of the entire body or of exposed areas affected, or; systemic therapy such as corticosteroids or other immunosuppressive drugs required for a total duration of six weeks or more, but not constantly, during the past 12-month period. A maximum evaluation of 60 percent requires involvement of more than 40 percent of the entire body or more than 40 percent of exposed areas affected, or; constant or near-constant systemic therapy such as corticosteroids or other immunosuppressive drugs required during the past 12-month period. A disability under Diagnostic Code 7806 may also be rated as disfigurement of the head, face, or neck (Diagnostic Code 7800), or scars (Diagnostic Codes 7802, 7803, 7804, and 7805) depending on the predominant disability. 38 C.F.R. § 4.118. The Schedule for Rating Skin Disabilities was amended in 2008 so that it more clearly reflects VA's policies concerning the evaluation of scars, specifically, 38 C.F.R. § 4.118, Diagnostic Codes 7800-7805; however, these changes only apply to applications received by VA on or after October 23, 2008, or if a veteran was previously evaluated under those codes and requests review under the clarified criteria. See 73 Fed. Reg. 54708 (September 23, 2008). The Veteran's has not requested review under the clarified criteria, effective October 23, 2008. Consequently, the Board finds that the revisions to the skin regulations that took effect October 23, 2008 are not for application here. Scars, other than on the head, face, or neck, that are deep or that cause limited motion, are evaluated under Diagnostic Code 7801. Under Diagnostic Code 7801, a 10 percent evaluation is assigned for scars affecting an area or areas exceeding 6 square inches (39 sq. cm.); a 20 percent evaluation is assigned for scars affecting an area or areas exceeding 12 square inches (77 sq. cm.); a 30 percent evaluation is assigned for scars affecting an area or areas exceeding 72 square inches (465 sq. cm.); and a maximum 40 percent evaluation is assigned for scars affecting an area or areas exceeding 144 square inches (929 sq. cm.). 38 C.F.R. § 4.118. Scars in widely separated areas as on two or more extremities or on anterior or posterior surfaces of extremities or trunk, will be rated separately. Id. at Note (1). A deep scar is one associated with underlying soft tissue damage. Id. at Note (2). Under Diagnostic Code 7802, scars, other than those of the head, face, or neck, that are superficial and that do not cause limited motion that comprise an area or areas of 144 square inches (929 sq. cm.) or greater, a maximum 10 percent evaluation is provided. 38 C.F.R. § 4.118. Scars in widely separated areas as on two or more extremities or on anterior or posterior surfaces of extremities or trunk, will be rated separately. Id. at Note (1). A superficial scar is one not associated with underlying soft tissue damage. Id. at Note (2). Diagnostic Code 7803 provides that for scars that are superficial and unstable, a maximum 10 percent evaluation is warranted. The notes to this diagnostic code state that an unstable scar is one where, for any reason, there is frequent loss of covering of skin over the scar and that a superficial scar is one not associated with underlying soft tissue damage. 38 C.F.R. § 4.118. Diagnostic Code 7804 provides a maximum 10 percent evaluation for superficial scars that are painful on examination. The notes to this diagnostic code provide that a superficial scar is one not associated with underlying soft tissue damage and 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. 38 C.F.R. § 4.118. Under Diagnostic Code 7805, scars can also be assigned disability ratings based upon limitation of function of the affected part. 38 C.F.R. § 4.118. Pyramiding, that is the evaluation of the same disability, or the same manifestation of a disability, under different diagnostic codes, is to be avoided when evaluating a veteran's service-connected disability. 38 C.F.R. § 4.14. However, it is possible for a veteran to have separate and distinct manifestations from the same injury which would permit rating under several diagnostic codes; the critical element in permitting the assignment of several evaluations under various diagnostic codes is that none of the symptomatology for any one of the conditions is duplicative or overlapping with the symptomatology of the other condition. See Esteban v. Brown, 6 Vet. App. 259, 261- 62 (1994). In rendering a decision on appeal the Board must also analyze the credibility and probative value of the evidence, account for the evidence which it finds to be persuasive or unpersuasive, and provide the reasons for its rejection of any material evidence favorable to the claimant. Gabrielson v. Brown, 7 Vet. App. 36, 39-40 (1994); Gilbert v. Derwinski, 1 Vet. App. 49, 57 (1990). Competency of evidence differs from weight and credibility. Competency is a legal concept determining whether testimony may be heard and considered by the trier of fact, while credibility is a factual determination going to the probative value of the evidence to be made after the evidence has been admitted. Rucker v. Brown, 10 Vet. App. 67, 74 (1997); Layno v. Brown, 6 Vet. App. 465, 469 (1994); see also Cartright v. Derwinski, 2 Vet. App. 24, 25 (1991) ("although interest may affect the credibility of testimony, it does not affect competency to testify"). Disability Rating Analysis and the Restoration of 30 Percent Rating The Veteran contends that a 30 percent rating is warranted for xerotic eczema from September 20, 2002 to November 14, 2008, and that restoration of a 30 percent rating is warranted from January 1, 2011. She contends during a May 2013 Travel Board hearing that at least 20 percent of total body surfaces are affected by her disability and that this has not changed during the rating period, that there was no improvement in her disability in 2011, and that she continued to treat her symptoms with moisturizers and topical corticosteroids. During testimony at the May 2013 Travel Board hearing, the Veteran and her representative specified that the grant of a 30 percent rating from September 20, 2002, and the restoration of a 30 percent rating from January 1, 2011 would fully satisfy the appeal for a higher initial rating and for restoration. The Board has granted a higher initial 30 percent rating for xerotic eczema from September 20, 2002 to November 14, 2008 and restored the 30 percent evaluation from January 1, 2011. Thus, this is a full grant of the benefits sought on appeal. The Board finds the Veteran's waiver of the remaining aspects of the appeal was knowing and intelligent, was made with representation and in the presence of his representative, and was supported by the Veteran's testimony. The Veteran and her representative explicitly stated that the 30 percent rating evaluation would "fully satisfy" the appeal. This is distinguished from a case where a veteran does not express satisfaction with a partial increased rating during an appeal that is less than the maximum schedular rating. See A.B., 6 Vet. App. at 39 (recognizing that a claimant may limit the claim or appeal to the issue of entitlement to a particular disability rating which is less than the maximum allowed by law for a particular service-connected disability). In this case a 30 percent initial disability rating for xerotic eczema from September 20, 2002 to November 14, 2008, and from January 1, 2011 has been granted, and the Veteran has limited her appeal in both extent and time by withdrawing the aspects of the appeal that encompassed a higher initial rating in excess of 30 percent. See 38 C.F.R. § 20.204 (2012) (providing that an appellant may withdraw an issue at any time before the Board issues a final decision). For these reasons, any question of a higher disability rating in excess of 30 percent are rendered moot with no remaining questions of law or fact to decide. See 38 U.S.C.A. § 7104 (West 2002); Sabonis v. Brown, 6 Vet. App. 426, 430 (1994) (where the law is dispositive, the claim must be denied due to a lack of legal merit). The Board is required to ascertain in any rating reduction case, based upon review of the entire record, whether the evidence reflects an actual change in the disability, whether the examination reports reflecting such change are based upon thorough examination, and whether any improvement actually reflects improvement in the Veteran's ability to function under the ordinary conditions of life and work. Brown v. Brown, 5 Vet. App. 413, 420 (1993). In this case, the evidence shows the Veteran's 30 percent disability rating for xerotic eczema was in effect less than five years at the time of the rating reduction; therefore, the provisions of 38 C.F.R. § 3.344(a), which set forth regulatory requirements for evaluations in effect for five or more years, are not for application. See 38 C.F.R. § 3.344(c) (2012). Because the Veteran's disability rating was in effect for less than five years, the Board finds that the provisions of 38 C.F.R. § 3.344(c) are for application. 38 C.F.R. § 3.344(c) provides that, for disabilities which have not become stabilized and are likely to improve, reexaminations disclosing improvement in these disabilities will warrant a reduction in rating. The Board finds that the evidence of record, lay and medical, did not disclose material improvement in service-connected xerotic eczema warranting the reduction of the 30 percent rating from January 1, 2011. After a review of all the evidence, lay and medical, the Board finds that both from September 20, 2002 to November 14, 2008 and from January 1, 2011, the Veteran's service-connected xerotic eczema has been manifested by chronic, recurrent outbreaks affecting at least 20 percent, but not more than 40 percent, of the entire body, approximating the criteria for a higher initial 30 percent rating under Diagnostic Code 7806. See 38 C.F.R. § 4.118. VA treatment records dated from 2002 to 2008 show that the Veteran was treated with lac-hydrin, a lactose ammonia lotion, and trimcinolone (TAC) ointment for xerotic eczema. An April 2004 treatment report shows that the Veteran's rash was recurring. A November 2004 dermatology note specified that TAC ointment was only to be used during flare-ups. VA treatment records dated from 2004 to 2008 also identify post-inflammatory hyperpigmentation due to xerotic eczema. At various times, the condition affected the back, upper extremities, shoulders, and hands. A December 2007 VA skin examination shows that the Veteran's xerotic eczema was manifested by an itchy rash. She received daily topical treatment with lac-hydrin and TAC ointment, which was noted to be a corticosteroid. There were no side effects from the treatment. The VA examiner stated that less than 5 percent of total body area was affected by xerotic eczema. A January 2009 VA examination shows that the Veteran was treated with TAC ointment, fluinonide cream, and ammonium lactate location daily. The Veteran did not report systemic symptoms. She had xerois present on the bilateral upper and lower extremities, dryness on the back, and scarring with post-inflammatory hyperpigmentation. The VA examiner stated that at least 20 percent of total body surface area was affected by this condition and less than five percent of exposed surface area was affected. The Board finds that the Veteran has provided competent and credible lay testimony in May 2013 identifying involvement of approximately 20 percent of total body surface area since September 20, 2002 and currently, stating that her condition has not changed. The Board finds that her lay testimony is supported by findings from the January 2009 VA examination report, indicating that at least 20 percent of total body surface area was affected by xerotic eczema. While the January 2009 VA examination was dated after the rating from September 20, 2002 to November 14, 2008, because examination was completed just two months after the relevant rating period and because VA treatment records show that flare-ups of xerotic eczema were recurrent, the Board finds that the January 2009 VA examination provides probative evidence with regard to the severity of the xerotic eczema for the rating period from September 20, 2002 to November 14, 2008. Resolving reasonable doubt in the Veteran's favor on this question, the Board finds that the weight of the evidence, lay and medical, shows that xerotic eczema has been manifested by chronic, recurrent outbreaks affecting at least 20 percent of the entire body. For these reasons, resolving reasonable doubt in favor of the Veteran, the Board finds that from September 20, 2002 to November 14, 2008 the severity of xerotic eczema more nearly approximates a 30 percent disability rating under Diagnostic Code 7806. See 38 U.S.C.A. § 5107(b); 38 C.F.R. §§ 4.3, 4.7. The Board finds that there was no material change in the severity of the Veteran's disability from January 2011. A January 2011 letter from the Veteran's private physician shows that she was treated for periodic allergic dermatitis which was seasonally exacerbated. A June 2012 VA examination shows that the Veteran continued to receive constant or near constant treatment with a topical corticosteroid. On examination, five percent of total body area and five percent of exposed body area was affected by xerotic eczema. September 2012 and March 2013 VA treatment reports show that the Veteran had flares of xerotic eczema intermittently with post-inflammatory hyperpigmentation and signs of dyshididrotic eczema. Treatment with phototherapy was considered, but declined in September 2012. In March 2013, the Veteran was seen with a flare of xerotic eczema in the middle of her chest and she had itchiness in her hands and fingers. A physical examination shows that the Veteran had xerosis diffusely over the arms, chest, and back, a hyperpigmented patch on the right arm over the elbow, and erythema on the central chest, abdomen, and right flank. She additionally was started on hydroxyzine, and antihistamine. The Board finds that, while only five percent of total body area was affected by xerotic eczema during a January 2011 VA examination, VA and private treatment records and lay testimony from the Veteran show xerotic eczema was characterized by intermittent flare-ups. The Board finds that the January 2011 VA examination did not address the severity of the Veteran's disability during an active phase. See Ardison v. Brown, 6 Vet. App. 405, 407-08 (1994). In that regard, during a March 2013 VA dermatology clinic evaluation, xerotic eczema was shown to involve a more extensive area than indicated during the January 2011 VA examination, and involved both arms, the chest, and the back. VA treatment records show that the Veteran continues to be treated with TAC ointment, a hydrophilic ointment, and additionally, she was started on an antihistamine and phototherapy was considered. For these reasons, the Board finds that the January 2011 VA examination does not reflect actual change in the severity of the Veteran's disability and did not disclose material improvement in service-connected xerotic eczema. Resolving doubt in favor of the Veteran, from January 1, 2011, the Board finds that the restoration of a 30 percent rating for xerotic eczema is warranted. See 38 U.S.C.A. § 5107(b); 38 C.F.R. §§ 4.3, 4.7. The Board finds that for the entire rating period, from September 20, 2002 to November 14, 2008, and from January 1, 2011, xerotic eczema was treated with topical therapy and treatment did not approximate constant or near-constant use of systemic therapy during any 12-month period to warrant the next higher 60 percent rating under Diagnostic Code 7806. See 38 C.F.R. § 4.118. In May 2013 Board hearing testimony, the Veteran contends that she is treated with topical corticosteroids. VA treatment records and examinations and prescriptions dated in November 2008 show that the Veteran was prescribed with fluocinonide topical solution and TAC ointment, both identified as corticosteroids. The Board finds, however, that the constant or near constant use of a topical corticosteroid does not approximate a rating based on constant or near constant "systemic therapy" under Diagnostic Code 7806. In that regard, topical treatments are not characterized as "systemic," as they do not reach cells through the bloodstream, and Diagnostic Code 7806 specifically provides for a 0 percent, noncompensable evaluation, based on treatment with "no more than topical therapy" required. During a September 2010 DRO hearing, the Veteran reported that she was treated with immunosuppressive drugs and she contends in May 2013 Board hearing testimony that she is currently receiving allergy shots. An October 2009 letter from the Veteran's private physician and private treatment reports reflect treatment with immunotherapy allergy shots for seasonal allergies and pollen allergies, and the Veteran was prescribed an oral corticosteroid in August 2010 for treatment of respiratory symptoms, to include asthma. The weight of the evidence shows that the Veteran's immunotherapy and allergy shots were for treatment of respiratory allergies and symptoms and not for the service-connected xerotic eczema; therefore, such treatment may not be considered in rating the service-connected xerotic eczema. See 38 C.F.R. § 4.14 (rating of the same manifestation under different diagnoses is to be avoided). For these reasons, the Board finds that the Veteran did not receive constant or near constant systemic therapy for treatment of xerotic eczema. Moreover, the Veteran's xerotic eczema is not shown to involve 40 percent or more of the entire body area at any time during the relevant appeal periods, nor does the Veteran contend such. Instead she has testified that 20 percent of the body surface was affected by xerotic eczema, and she was able to maintain her condition with medication treatment. For these reasons, the Board finds that from September 20, 2002 to November 14, 2008, and from January 1, 2011, a higher 60 percent evaluation is not warranted under Diagnostic Code 7806. See 38 C.F.R. §§ 4.3, 4.7. A disability under Diagnostic Code 7806 may also be rated based on scars (Diagnostic Codes 7801-7805) depending on the predominant disability. See 38 C.F.R. § 4.118. The Board finds that a compensable evaluation is not warranted under Diagnostic Codes 7801, 7802, 7803, or 7804, where xerotic eczema has not been shown to result in scars that are deep, causing limited motion; scars covering an 144 square inches or greater; scars that are unstable; or scars that are painful on examination at any time during the relevant rating periods. See 38 C.F.R. § 4.118. Xerotic eczema did not result in any functional limitation to the affected parts, such as limitation of motion; thus, a rating based on limitation of function is not warranted under Diagnostic Code 7805. See 38 C.F.R. § 4.118. For these reasons, the Board finds that the criteria for an initial evaluation in excess of 30 percent from September 20, 2002 to November 14, 2008, and in excess of 30 percent from January 1, 2011, are not met or more nearly approximated. See 38 C.F.R. § 4.130. Because the Veteran has withdrawn the aspects of the appeal that encompassed an increased rating in excess of 30 percent from September 20, 2002 to November 14, 2008, and from January 1, 2011, the Board finds that further discussion of these issues is not necessary. Extraschedular Consideration The Board has considered whether referral for an extraschedular evaluation is warranted. In exceptional cases an extraschedular rating may be provided. 38 C.F.R. § 3.321 (2012). 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, there must be a comparison between the level of severity and symptomatology of the claimant's service-connected disability with the established criteria found in the rating schedule for that disability. Thun v. Peake, 22 Vet. App. 111 (2008). Under the approach prescribed by VA, if the criteria reasonably describe the claimant's disability level and symptomatology, then the claimant's disability picture is contemplated by the rating schedule, the assigned schedular evaluation is, therefore, adequate, and no referral is required. In the second step of the inquiry, however, if the schedular evaluation does not contemplate the claimant's level of disability and symptomatology and is found inadequate, the RO or Board must determine whether the claimant's exceptional disability picture exhibits other related factors such as those provided by the regulation as "governing norms." 38 C.F.R. 3.321(b)(1) (related factors include "marked interference with employment" and "frequent periods of hospitalization"). When the rating schedule is inadequate to evaluate a claimant's disability picture and that picture has related factors such as marked interference with employment or frequent periods of hospitalization, then the case must be referred to the Under Secretary for Benefits or the Director of the Compensation and Pension Service for completion of the third step-a determination of whether, to accord justice, the claimant's disability picture requires the assignment of an extraschedular rating. Id. The Board finds that the symptomatology and impairment caused by the Veteran's xerotic eczema, to include the extent of the area affected and treatment required, is specifically contemplated by the schedular rating criteria, and no referral for extraschedular consideration is required. The schedular rating criteria, including Diagnostic Codes 7806 specifically provides for disability ratings based on the extent of the area affected by eczema and required treatment. See 38 C.F.R. § 4.118. In this case, considering the lay and medical evidence, the Veteran's disability has affected at approximately 20 percent of total body area and was treated with topical therapy only. These symptoms and impairment are part of or similar to symptoms listed under the schedular rating criteria. See 38 C.F.R. § 4.20 (2012) (schedular rating criteria provides for rating by analogy based on similar functions, anatomical location, and symptomatology). The schedule is intended to compensate for average impairments in earning capacity resulting from service-connected disability in civil occupations. 38 U.S.C.A. § 1155 (2012). " 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. In this case, the problems reported by the Veteran, such as seasonal flare-ups or exacerbations with various exposures, are specifically contemplated by the criteria discussed above, including the effect on her occupation and daily life, and her 30 percent rating was granted based on the extent of xerotic eczema during such flare-ups. In the absence of exceptional factors associated the Veteran's disability, the Board finds that the criteria for submission for assignment of an extraschedular rating pursuant to 38 C.F.R. § 3.321(b)(1) are not met. See Bagwell v. Brown, 9 Vet. App. 337 (1996); Shipwash v. Brown, 8 Vet. App. 218, 227 (1995). Additionally, the 30 percent full grant of benefits also moots any extraschedular referral questions. ORDER For the period from January 1, 2011, restoration of a 30 percent evaluation for xerotic eczema is granted. For the period from September 20, 2002 to November 14, 2008, a higher initial 30 percent rating for xerotic eczema is granted. REMAND Increased Rating for Allergic Rhinitis and Service Connection for Depression In an August 2012 rating decision, the RO denied service connection for depression and denied increased ratings for allergic rhinitis and asthma. While the Veteran submitted a substantive appeal (VA Form 9) in April 2013 addressing allergic rhinitis and depression, a prior notice of disagreement is not of record, and the RO has not issued a statement of the case addressing an increased rating for allergic rhinitis or service connection for depression. The Board has liberally construed the April 2013 "substantive appeal" as a timely notice of disagreement to the August 2012 denial of an increased rating for allergic rhinitis and service connection for depression. The filing of a notice of disagreement places a claim in appellate status. A statement of the case is required, and a remand order is necessary in such cases where a notice of disagreement has been received. See 38 C.F.R. §§ 19.9, 20.200, 20.201 (2012); Manlincon, 12 Vet. App. at 238; Godfrey v. Brown, 7 Vet. App. 398 (1995); Archbold v. Brown, 9 Vet. App. 124 (1996). The purpose of the remand is to give the RO an opportunity issue a statement of the case. Thereafter, the RO should return the claims file to the Board only if the Veteran perfects in a timely manner the appeal for an increased rating for allergic rhinitis and service connection for depression. See Smallwood v. Brown, 10 Vet. App. 93, 97 (1997); see also In re Fee Agreement of Cox, 10 Vet. App. 361, 374 (1997) (holding that if the claims file does not contain a notice of disagreement, a statement of the case and a VA Form 9 (substantive appeal), the Board is not required and has no authority to decide the claim). Accordingly, the issue of entitlement to an increased rating for allergic rhinitis is REMANDED for the following action: The RO/AMC should issue a statement of the case addressing the issues of an increased rating for allergic rhinitis and service connection for depression. The Veteran should be given an opportunity to perfect the appeal by submitting a timely substantive appeal. The RO/AMC should advise the Veteran that the claims file will not be returned to the Board for appellate consideration of this issue following the issuance of the statement of the case unless she perfects her appeal. 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). J. PARKER JONATHAN B. KRAMER Veterans Law Judge, Veterans Law Judge, Board of Veterans' Appeals Board of Veterans' Appeals K. ALIBRANDO Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs