Citation Nr: 1332979 Decision Date: 10/22/13 Archive Date: 10/24/13 DOCKET NO. 11-24 928 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in San Diego, California THE ISSUE Whether the Veteran's countable income was excessive for the purpose of receipt of nonservice-connected pension benefits. REPRESENTATION Appellant represented by: California Department of Veterans Affairs ATTORNEY FOR THE BOARD S. Keyvan, Counsel INTRODUCTION The Veteran served on active duty from June 1951 to May 1954. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a November 2010 rating decision by the Department of Veterans Affairs (VA) Pension Management Center (PMC) in St. Paul, Minnesota. In that decision, the PMC denied the Veteran's request to reinstate his nonservice-connected pension benefits. (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 Board notes that the Veteran requested a hearing before a Veterans Law Judge at the RO and was scheduled for a Board hearing on August 8, 2013. However, he subsequently cancelled his hearing request and requested that his file be sent to the Board for adjudication. Accordingly, the Veteran's hearing request is considered withdrawn. See 38 C.F.R. §20.704(e) (2013). REMAND The Board finds that further evidentiary development is necessary before a decision can be reached on the merits of the Veteran's claim. At the outset, the Board notes the Veterans Claims Assistance Act of 2000 (VCAA), Pub. L. No. 106-475, 114 Stat. 2096 (2000). See 38 U.S.C.A. §§ 5100, 5102, 5103, 5103A, and 5107 (West 2002 & Supp. 2013). To implement the provisions of the law, VA promulgated regulations codified at 38 C.F.R. §§ 3.102, 3.156(a), 3.159, 3.326(a) (2013). The VCAA and its implementing regulations include, upon the submission of a substantially complete application for benefits, an enhanced duty on the part of VA to notify a claimant of the information and evidence needed to substantiate a claim, as well as the duty to notify the claimant of what evidence will be obtained by whom. 38 U.S.C.A. § 5103(a); 38 C.F.R. § 3.159(b). In addition, they define the obligation of VA with respect to its duty to assist a claimant in obtaining evidence. 38 U.S.C.A. § 5103A; 38 C.F.R. § 3.159(c). A brief historical overview reflects that the PMC stopped payment of the Veteran's nonservice-connected pension benefits, effective May 1, 2005, on account of excessive income. This was done by way of a February 2008 letter. The Veteran did not appeal the termination of his nonservice-connected pension benefits. Rather, in a claim dated in October 2009, and date stamped as received on November 2, 2009, the Veteran requested that payment of a nonservice-connected pension benefits be reinstated. This claim was denied by the PMC in January 2010. Subsequent requests to reinstate his pension benefits were made in March 2010 and October 2010, and these requests were followed by denials dated in September 2010 and November 2010, respectively. After receiving notice of the November 2010 denial of pension benefits, the Veteran filed a notice of disagreement (NOD) with this decision and proceeded to perfect his appeal in September 2011. In this case, the PMC failed to satisfy the duty to notify the Veteran as required by the VCAA. In so finding, the Board notes that the PMC did not provide the Veteran with a notice document at any point in the adjudication of his claim. The Veteran has thus not been provided with notice of the elements necessary to establish entitlement to the claimed benefit, or notice regarding the assignment of effective dates. Thus, the Board finds action is required to satisfy the notification provisions of the VCAA. See Disabled American Veterans v. Secretary of Veterans Affairs, 327 F.3d 1339 (Fed. Cir. 2003); Pelegrini v. Principi, 18 Vet. App. 112 (2004); see also Dingess/Hartman v. Nicholson, 19 Vet. App. 473 (2006), aff'd, Hartman v. Nicholson, 483 F.3d 1311 (Fed. Cir. 2007). Accordingly, the agency of original jurisdiction (AOJ) must, prior to re-adjudication in accordance with this remand, issue the Veteran a supplemental notice letter that specifically addresses his claim, to include the information and evidence needed to substantiate the claim, as well as notification of what evidence will be obtained by VA and what evidence the Veteran is responsible for submitting. 38 U.S.C.A. § 5103(a); 38 C.F.R. § 3.159(b) (2013); see also Overton v. Nicholson, 20 Vet. App. 427 (2006). The AOJ must also provide notice concerning the assignment of effective dates pursuant to Dingess/Hartman, supra. After providing the required notice, the AOJ must again attempt to obtain any pertinent outstanding evidence for which the Veteran provides sufficient information and, if necessary, authorization. See 38 U.S.C.A. § 5103A(a), (g); 38 C.F.R. § 3.159. See also Charles v. Principi, 16 Vet. App. 370 (2002); Quartuccio v. Principi, 16 Vet. App. 183, 187 (2002). The Board further finds that a remand is necessary to determine whether the Veteran's annual household countable income has been correctly calculated. In determining annual income, all payments of any kind or from any source (including salary, retirement or annuity payments, or similar income, which has been waived) shall be included during a 12-month annualization period in which received, except for listed exclusions. 38 U.S.C.A. § 1503(a); 38 C.F.R. §§ 3.271(a). Social Security Administration (SSA) income is not specifically excluded under 38 C.F.R. § 3.272; nor is the income of a spouse. In fact, the Veteran's annual income includes the annual income of the Veteran, his dependant spouse, and children in the Veteran's custody or to whose support the Veteran is reasonably contributing. 38 C.F.R. § 3.23(d)(4). Such incomes are therefore included as countable income. Unreimbursed medical expenses in excess of 5 percent of the maximum annual pension rate (MAPR), which have been paid, may be excluded from an individual's income for the same 12-month annualization period to the extent they were paid. 38 C.F.R. § 3.272(g)(1)(iii). In order to be excluded from income, these medical expenses must be paid during the time period at issue, regardless of when they were incurred. In addition, they must be out-of-pocket expenses, for which the Veteran received no reimbursement, such as through an insurance company. However, medical insurance premiums themselves, as well as the Medicare deduction, may be applied to reduce countable income. In reviewing the Veteran's claims file, the Board notes that the Veteran has submitted additional documentation since the most recent Supplemental Statement of the Case (SSOC) dated in January 2012. These documents include a Financial Status Report that summarizes the total amount of the Veteran's medical expenses as a result of hospitalizations for various medical procedures dating from 2011 to 2013. These particular expenses are categorized by the original amount of the debt, the unpaid balance, and the monthly amount due. Along with the Financial Status Report, the Veteran also submitted medical expense reports dated from 2010 through 2013, all of which include itemized lists of medical expenses accrued by the Veteran and his spouse during the aforementioned calendar years. In calculating the Veteran's family income for the November 2009 through November 2010 annualization period, the RO appears to have allowed a deduction for medical expenses, which is the Veteran's spouse's monthly premium for Medicare Part B, as shown on Social Security Administration (SSA) Inquiry printouts in the amount of $96.50 per month. The Board notes, however, that the RO has not had an opportunity to review the more recent evidence and provide calculations which take into consideration a more current and detailed itemized list of medical expenses for the designated annualization period as provided by the Veteran in the recently submitted medical expense form. In addition, on a separate piece of paper, the Veteran submitted a handwritten list of medical expenses accumulated by his family for the 2009 calendar year. It does not appear that the RO allowed a deduction for medical expenses accrued during the relevant annualization period - namely in November 2009 and December 2009 - when calculating the Veteran's countable income. Furthermore, in determining the Veteran's eligibility for payment of nonservice-connected pension benefits, the RO has submitted two separate Eligibility for Basic Pension summary forms pertaining to the relevant annualization period, both of which include a deduction in the amount of $96.40 for the Veteran's spouse's monthly Medicare Part B deduction. This deduction amount conflicts with the amount reflected in the SSA Inquiry printouts ($96.50), and the Medicare Part B deductions made by the RO when readjudicating the Veteran's claim in the August 2011 Statement of the Case (SOC). Moreover, the Board observes that when calculating the Veteran's medical expenses, the RO arrived at different amounts in the November 2010 rating decision and August 2011 SOC ($1,289.00), and the two separate Eligibility for Basic Pension forms ($1,294.87 and $1,152.00). Moreover, as previously noted, medical expense forms dated in 2011, 2012, and 2013 also included separate, and at times lengthy, itemized lists of medical expenses incurred by the Veteran and his spouse throughout each year. Although the Veteran has waived RO consideration of the additional evidence, the Board finds that in light of the internal inconsistency as to the medical expenses incurred by the Veteran's family during the annualization period, and given the lack of clarity as to the method in which the RO accounted for the Veteran's medical expenses for the period from November 2, 2009 through November 30, 2010, the Veteran's claim should be remanded so the AOJ can provide a more detailed accounting of how it determined the Veteran's countable income and his pension entitlement for the 2010 and 2011 years. A remand of the claim will also provide the AOJ with an opportunity to review the additional evidence submitted with regard to subsequent years. Accordingly, the case is REMANDED for the following action: 1. Send the Veteran a VCAA-compliant notice letter requesting that he provide sufficient information and, if necessary, authorization to enable VA to obtain any additional pertinent evidence not currently of record. The AOJ must explain the type of evidence VA will attempt to obtain as well as the type of evidence that is his ultimate responsibility to submit. The Veteran must be specifically provided with notice concerning the information and evidence needed to substantiate the claim on appeal. This includes issuing letters to the Veteran and obtaining any additional financial or other evidence as deemed appropriate. 2. Review the calculation of countable income, to include the calculation of the deduction of unreimbursed medical expenses (Medicare Part B premiums) for the period from November 2, 2009 to November 30, 2010, to determine its accuracy. Ensure that the Medicare Part B deductions for the annualization period and the 2011, 2012, and 2013 calendar years is the same as that reflected in the appropriate SSA Inquiry printouts. If there are any facts or figures that need clarification or supporting documentation by the Veteran, he should be contacted and requested to provide what is needed. In a detailed summary, the RO must provide a clear explanation for all figures used so that the Board is able to understand where it derived the amounts used in calculating the Veteran's countable income for the annualization period (November 2, 2009 through November 30, 2010) and the following 2011, 2012 and 2013 calendar years and why such amounts were used, citing to appropriate authority where applicable. 3. Following any additional argument or evidence submitted by the Veteran, and after undertaking any other development deemed appropriate, the claim on appeal must be readjudicated in light of all pertinent evidence and legal authority. If any benefit sought is not granted, the Veteran and his representative should be furnished with a supplemental statement of the case and afforded an opportunity to respond. 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 case must be afforded expeditious treatment. The law requires that all claims that are remanded by the Board or by the United States Court of Appeals for Veterans Claims (Court) for additional development or other appropriate action must be handled in an expeditious manner. See 38 U.S.C.A. §§ 5109B, 7112 (West Supp. 2013). ________________________________ MARK F. HALSEY Veterans Law Judge, Board of Veterans' Appeals Under 38 U.S.C.A. § 7252 (West 2002), only a decision of the Board is appealable to the Court. This remand is in the nature of a preliminary order and does not constitute a decision of the Board on the merits of your appeal. 38 C.F.R. § 20.1100(b) (2013).