Citation Nr: 1415026 Decision Date: 04/07/14 Archive Date: 04/15/14 DOCKET NO. 10-39 051 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office and Insurance Center in Philadelphia, Pennsylvania THE ISSUES 1. Whether the reduction of the appellant's nonservice-connected death pension benefits, effective January 1, 2009, was proper. 2. Whether the reduction of the appellant's nonservice-connected death pension benefits, effective December 1, 2009, was proper. REPRESENTATION Appellant represented by: Disabled American Veterans ATTORNEY FOR THE BOARD A. Haddock, Associate Counsel INTRODUCTION The Veteran served on active duty from November 1940 to June 1945. The Veteran died in November 2008; the appellant is the Veteran's surviving spouse. These matters come before the Board of Veterans' Appeals (Board) on appeal from a June 2009 decision by the Philadelphia, Pennsylvania Department of Veterans Affairs Regional Office and Insurance Center (RO). The Board has not only reviewed the Veteran's physical claims file but also the Veteran's file on the "Virtual VA" and "VBMS" systems to insure a complete review of the evidence. FINDINGS OF FACT 1. As of January 1, 2009, the appellant's countable income, accounting for deductions for burial and medical expenses, was $11,971.00. 2. As of December 1, 2009, the appellant's countable income, accounting for deductions for medical expenses, was $12,216.00 2. For the entire period on appeal, the appellant reported that her unreimbursed medical expenses totaled $1,156.00 per year. CONCLUSIONS OF LAW 1. Reduction of VA death pension benefits effective January 1, 2009, was proper. 38 U.S.C.A. §§ 1502, 1503, 1521, 1541 (West 2002); 38 C.F.R. §§ 3.23, 3.271, 3.272, 3.273, 3.660 (2013). 2. Reduction of VA death pension benefits effective December 1, 2009, was proper, but the monthly payment from that date was not properly calculated. 38 U.S.C.A. §§ 1503, 1541 (West 2002); 38 C.F.R. §§ 3.3, 3.23, 3.262, 3.271, 3.272, 3.273 (2013). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS I. Duties to Notify and Assist Upon receipt of a substantially complete application for benefits, VA must notify the claimant what information or evidence is needed in order to substantiate the claim and it must assist the claimant by making reasonable efforts to get the evidence needed. 38 U.S.C.A. §§ 5103(a) , 5103A; 38 C.F.R. § 3.159(b); see Quartuccio v. Principi, 16 Vet. App. 183, 187 (2002). The notice required must be provided to the claimant before the initial unfavorable decision on a claim for VA benefits, and it must (1) inform the claimant about the information and evidence not of record that is necessary to substantiate the claim; (2) inform the claimant about the information and evidence that VA will seek to provide; and (3) inform the claimant about the information and evidence the claimant is expected to provide. 38 U.S.C.A. §§ 5103(a); 38 C.F.R. § 3.159(b)(1); Pelegrini v. Principi, 18 Vet. App. 112, 120 (2004). The notice requirements of 38 U.S.C.A. § 5103(a) and 38 C.F.R. § 3.159(b) apply to all five elements of a service connection claim. Those five elements include: 1) veteran status; 2) existence of a disability; 3) a connection between the veteran's service and the disability; 4) degree of disability; and 5) effective date of the disability. Dingess/Hartman v. Nicholson, 19 Vet. App. 473 (2006). Upon receipt of an application for a service-connection claim, 38 U.S.C.A. § 5103(a) and 38 C.F.R. § 3.159(b) require VA to review the information and the evidence presented with the claim and to provide the claimant with notice of what information and evidence not previously provided, if any, will assist in substantiating or is necessary to substantiate the elements of the claim as reasonably contemplated by the application. Additionally, this notice must include notice that a disability rating and an effective date for the award of benefits will be assigned if service connection is awarded. In December 2008, the appellant was provided with a notice letter that explained how to substantiate her claim for VA non-service connected death pension benefits. The letter addressed all of the notice elements and was sent prior to the initial decision by the RO in June 2009. The duty to assist was also met in this case. All necessary financial information pertaining to the claim for death pension benefits was associated with the claims files and was reviewed by both the RO and the Board in connection with the claims. Significantly, neither the appellant nor her representative has identified, and the record does not otherwise indicate, any additional existing evidence that is necessary for a fair adjudication of the claim that has not been obtained. Hence, no further notice or assistance to the appellant is required to fulfill VA's duty to assist in the development of her claim. Smith v. Gober, 14 Vet. App. 227 (2000), aff'd 281 F.3d 1384 (Fed. Cir. 2002); Dela Cruz v. Principi, 15 Vet. App. 143 (2001); see also Quartuccio v. Principi, 16 Vet. App. 183 (2002). II. Legal Criteria and Analysis The appellant is claiming as the surviving spouse of a Veteran who had qualifying wartime service; as such, she is eligible for a rate of pension set by law, reduced by the amount of her countable income. 38 U.S.C.A. § 1541 (West 2002); 38 C.F.R. § 3.23 (2013). The appellant's payment of death pension benefits was reduced, effective from January 1, 2009, and reduced a second time, effective from December 1, 2009, because the RO determined that her countable income had increased. Death pension benefits are generally available for surviving spouses as a result of the Veteran's nonservice-connected death. 38 U.S.C.A. § 1541(a). A higher rate of death pension is available for a surviving spouse who is in need of regular aid and attendance. 38 U.S.C.A. § 1541(d)(1); 38 C.F.R. § 3.23(d)(2). An appellant is entitled to such benefits if the Veteran served for 90 days or more, part of which was during a period of war; or, if the Veteran served during a period of war and was discharged from service due to a service-connected disability or had a disability determined to be service-connected, which would have justified a discharge for disability; and, if the claimant meets specific income and net worth requirements. 38 U.S.C.A. § 1541; 38 C.F.R. § 3.3(b)(4). The Board notes that income eligibility for pension, and the amount of any pension payable, is determined by subtracting the surviving spouse's annual countable family income from the maximum annual pension rate (MAPR) applicable to the surviving spouse's circumstances. In determining the surviving spouse's annual countable family income or IVAP, payments of any kind from any source shall be counted as income during the twelve-month annualization period in which received, including old age and survivor's insurance and disability insurance under Title II of the Social Security Act which will be considered income as a retirement benefit. 38 U.S.C.A. § 1503(a); 38 C.F.R. § 3.271(a); 38 C.F.R. § 3.262(f) (2013). Unreimbursed medical expenses in excess of five percent of the MAPR may be excluded from an individual's income for the same 12-month annualization period to the extent that the medical expenses were paid. 38 C.F.R. § 3.272(g)(2)(iii) (2013). 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 surviving spouse 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. Burial expenses paid by a surviving spouse (to the extent such burial expenses are not reimbursed by VA) during the calendar year following that in which death occurred may be deducted from annual income for the 12-month annualization period in which they were paid, or from annual income for any 12-month annualization period which begins during the calendar year of death, whichever is to the appellant's advantage. Otherwise, such expenses are deductible only for the 12-month annualization period in which they were paid. 38 C.F.R. § 3.272(h). The rates of death pension benefits (MAPR) are published in tabular form in appendix B of Veterans Benefits Administration Manual M21-1 (M21-1) and are given the same force and effect as if published in the Code of Federal Regulations. 38 C.F.R. § 3.21. In December 2008, the appellant filed a claim of entitlement to dependency and indemnity compensation (DIC), death pension, and accrued benefits. In a June 2009 letter, the appellant was notified that her claims for DIC and accrued benefits had been denied, as she did not meet the criteria for such claims; those denials are not currently on appeal. The June 2009 letter notified that the appellant had been awarded death pension with aid and attendance, in an April 2009 rating decision.. The June 2009 letter provided a detailed discussion of how the RO had calculated the appellant's monthly death pension payments, which became effective December 1, 2008. As an initial matter, the Board finds that the initial benefit amounts, effective December 1, 2008 and January 1, 2009, of $676.00 and $59.00, respectively, were properly calculated by the RO based on the evidence of record. The appellant's countable income prior to December 2008 was noted to be $4,807.00 after deductions for medical and burial expenses, which included Social Security Administration (SSA) benefits. When subtracted from the applicable MAPR of $12,681.00, the RO arrived at, $7,874.00, which when divided into 12 monthly payments, totaled $656.00. As such, the appellant was properly found to be entitled to a monthly death pension payment of $656.00, effective December 1, 2008. After an inquiry to SSA, it was determined that the appellant's SSA benefits increased which was reflected in her annual countable income. From December 1 2008 to December 1, 2009, the Veteran's countable income was noted to be $11,971.00, after reductions for medical and burial expenses. When her countable income was subtracted from the MAPR, $12,681.00, the RO arrived at a total of $709.00, which equates to 12 monthly payments of $59.00. As such, the appellant was properly determined to be entitled to a monthly death pension payment of $59.00, effective January 1, 2009. As to the question of the adjustment of the appellant's nonservice-connected death pension benefits from December 1, 2009, a decrease in the appellant's monthly benefits was warranted, but only to $39.00 a month. The appellant's countable income had remained the same; however, she was no longer entitled to take a reduction for burial benefits. See 38 C.F.R. § 3.272(h). As such, after deductions for medical expenses, the appellant's countable income was calculated at $12,216.00. She was notified to inform VA if she incurred any additional medical expenses; however, there is no indication from the record that such expenses were incurred. When her countable income was subtracted from the MAPR of $12,681.00, a total of $465.00 remained, which equates to a monthly payment of $38.75 or $39.00, instead of a monthly payment of $38.00 as improperly calculated by the RO. In a July 2011 Supplemental Statement of the Case (SSOC) the RO noted that the appellant's medical expenses had been reported as $1,156.00. However, it was explained that only expenses totaling over and above 5 percent of the MAPR could be deducted from an appellant's countable income, which would be $379.00. As such, the total of the Veteran's deductible medical expenses was $759.00. Based on the foregoing discussion, the Board has determined that the RO's calculations were proper with regard the reduction of the appellant's death pension benefits, effective January 1, 2009, and while a further reduction effective December 1, 2009 was proper, an error occurred in computing the appellant's monthly death pension payment from December 1, 2009. While nominal, the adjustment of the appellant's nonservice-connected death pension benefits, effective December 1, 2009, was inaccurate and entitlement to an amount of nonservice-connected death pension benefits in the amount of $39.00 per month from December 1, 2009, is warranted. [Continued on next page] ORDER Reduction of the appellant's death pension benefits, effective January 1, 2009 based on her countable income was proper; to this extent the appeal is denied. Reduction of the appellant's death pension benefits, effective December 1, 2009, based on her countable income was proper, to this extent the appeal is denied; however, adjustment of the appellant's nonservice-connected death pension benefits, effective December 1, 2009, was not properly calculated and entitlement to an amount of nonservice-connected death pension benefits of $39.00 per month from December 1, 2009 is warranted. ____________________________________________ MATTHEW D. TENNER Acting Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs