Citation Nr: 1605159 Decision Date: 02/10/16 Archive Date: 02/18/16 DOCKET NO. 15-07 769 ) DATE ) ) On appeal from the Department of Veterans Affairs Regional Office in San Diego, California THE ISSUE Entitlement to nonservice-connected pension payments. REPRESENTATION Veteran represented by: Disabled American Veterans ATTORNEY FOR THE BOARD P. Childers, Counsel INTRODUCTION This appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2015). 38 U.S.C.A. § 7107(a)(2) (West 2014). On August 19, 2015, the Veteran's representative faxed, on behalf of the Veteran, a new VA Form 21-0516-1 (Improved Pension Eligibility Verification Report). To the extent that was intended to initiate a claim, it has not been adjudicated by the Agency of Original Jurisdiction (AOJ). Therefore, the Board does not have jurisdiction over it, and it is referred to the AOJ for appropriate action. 38 C.F.R. § 19.9(b) (2015). The Veteran served on active duty from June 1945 until June 1946. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a decision by a Department of Veterans Affairs (VA) Regional Office (RO). FINDING OF FACT The Veteran served on active duty during World War II and was over age 65 at the time of his initial (November 2009) claim for VA pension payments; however, his income has been excessive for receipt of VA pension. CONCLUSION OF LAW The criteria for nonservice-connected pension payments are not met. 38 U.S.C.A. § 1521 (West 2014); 38 C.F.R. §§ 3.3, 3.23, 3.271, 3.272, 3.400, 3.660(a)(2) (2015). REASONS AND BASES FOR FINDING AND CONCLUSION I. Duties to Notify and Assist VA has a duty to notify the Veteran of the information and evidence necessary to substantiate the claims submitted, the division of responsibilities in obtaining evidence, and assistance in developing evidence, pursuant to the Veterans Claims Assistance Act of 2000 (VCAA). See 38 U.S.C.A. § 5103(a); 38 C.F.R. § 3.159(b). The notice requirements were accomplished in letters dated in December 2009 and February 2012. Mayfield v. Nicholson, 444 F.3d 1328, 1333 (Fed. Cir. 2006). The Veteran was apprised of the eligibility requirements for pension and the information and evidence needed to substantiate his claim, and of the information and evidence that he needed to submit. Additionally, all known and available records relevant to the issue of entitlement to pension have been obtained and associated with the Veteran's claims file. The Veteran also was offered the opportunity to testify regarding his claim in a Board hearing, which he initially accepted, but later withdrew. In sum, the Veteran was provided with a meaningful opportunity to participate in the claims process and he has done so. Accordingly, the Board concludes that all reasonable efforts have been made by VA to obtain evidence necessary to substantiate the claim resolved in this decision, and no further assistance to develop evidence is required. See Pelegrini, 18 Vet. App. at 121; Conway, 353 F.3d. at 1374, Dingess, 19 Vet. App. 473; see also ATD Corp. v. Lydall, Inc., 159 F.3d 534, 549 (Fed. Cir. 1998). Merits Basic entitlement to an improved monthly pension exists if a veteran served in the active military, naval or air service for 90 days or more during a period of war (38 U.S.C. 1521(j)); meets the net worth requirements under §3.274; does not have an annual income in excess of the applicable maximum annual pension rate; and is age 65 or older or is permanently and totally disabled from nonservice-connected disability not due to the veteran's own willful misconduct. 38 C.F.R. § 3.3(a)(3). For VA pension purposes, net worth includes assets such as bank accounts, stocks, bonds, mutual funds, annuities, and any property other than residence and a reasonable lot area. See M21-1, Part V, Subpart iii, Chapter 1, Section A.1.c. See also 38 C.F.R. §§ 3.274 and 3.275. If a claimant's assets are large enough that the claimant could use these assets to pay living expenses for a reasonable period of time, net worth is considered a bar. M21-1, Part V, Subpart iii, Chapter 1, Section A.1.e. Pension benefits are paid at the maximum annual rate reduced by the amount of annual income received by the veteran. 38 C.F.R. § 3.23(b). Countable income includes income from most sources as well as from any eligible dependents, and generally includes earnings, disability and retirement payments, interest and dividend payments from annuities, and net income from farming or a business. Some expenses, such as unreimbursed medical expenses, may reduce countable income. See 38 U.S.C.A. § 1503(a); 38 C.F.R. §§ 3.260, 3.261, 3.262, 3.271(a), 3.272. Effective December 1, 2008, yearly income for a single veteran with no dependents had to be less than the maximum annual pension rate (MAPR) of $11,830.00; and to be deducted, medical expenses had to exceed 5 percent of the MAPR, or $591.00. Effective December 1, 2009, yearly income for a single veteran with no dependents had to be less than the MAPR of $11,830.00; and to be deducted, medical expenses had to exceed 5 percent of MAPR, or $591.00. Effective December 1, 2012, yearly income for a single veteran with no dependents had to be less than the MAPR of $12,465.00; and to be deducted, medical expenses had to exceed 5 percent of MAPR, or $623.00. Effective December 1, 2013, yearly income for a single veteran with no dependents had to be less than the MAPR of $12,652.00; and to be deducted, medical expenses had to exceed 5 percent of MAPR, or $632.00. Effective December 1, 2014, yearly income for a single veteran with no dependents had to be less than the MAPR of $12,868.00; and to be deducted, medical expenses had to exceed 5 percent of MAPR, or $643.00. Unreimbursed medical expenses will be excluded when all of the following requirements are met: (i) they were or will be paid by a veteran or spouse for medical expenses of the veteran, spouse, children, parents and other relatives for whom there is a moral or legal obligation of support; (ii) they were or will be incurred on behalf of a person who is a member or a constructive member of the veteran's or spouse's household; and (iii) they were or will be in excess of five percent of the applicable maximum annual pension rate or rates for the veteran as in effect during the 12-month annualization period in which the medical expenses were paid. 38 C.F.R. § 3.272(g). If the case involves an original or reopened claim, the initial annualization period extends from the date of pension entitlement through the end of the month that is 12 months from the month during which entitlement arose. M21-1, Part V, Subpart iii, Chapter 1, Section A.1.c. If the case involves a running award, the income reporting period for all years after the initial year of an original or new award is based on the calendar year. Id. Facts and Analyses The Veteran, who is unmarried with no dependent children, served on active duty during World War II. In November 2009 he filed his first claim for VA benefits, at his age of 82. He accordingly meets the service and age requirements for improved pension payments; without regard to disability. The issue then is whether he meets the net worth requirements under 38 C.F.R. § 3.274 and does not have annual income in excess of the applicable maximum annual pension rate specified in 38 C.F.R. § 3.23. As far as the Veteran's net worth, the Board notes that in his November 2009 claim the Veteran reported cash, non-interest bearing bank account assets of $694.00, and an interest bearing bank account/cd of $55,000.00. However, as the agency of original jurisdiction did not deny the claim on the grounds of excessive net worth in the first instance (see M21-1, Part V, Subpart iii, Chapter 1, Section A.1.f.; and M21-1, Part V, Subpart iii, Chapter 1, Section A.41.b. and c.), the Board must conclude that net worth is not prohibitive and will proceed to the next step of the inquiry; that is, whether the Veteran's countable annual income is excessive for VA pension purposes. A. November 24, 2009, claim Facts In his November 24, 2009, claim for compensation the Veteran reported that his only income was $1,028.00 per month [$12,336.00 per annum] from Social Security. In correspondence dated in January 2010 the Veteran reported that he had had 2009 medical expenses of $3,300.00; that his annual income was approximately $13,900.00; and that his rent was $772.00 per month [$9,264.00 per annum]. The Board notes that rent is not excludable from countable income. In January 2010 the Veteran submitted a Social Security payment record, which shows that beginning January 2, 2009, the Veteran was receiving Social Security payments of $1,124.40 per month ($13,492.80 per annum), from which Social Security deducted $96.40 per month ($1,156.80 per annum) for Medicare medical insurance. In a decision by letter dated November 7, 2010, the RO advised the Veteran that he was ineligible for nonservice-connected pension because his annual income of $13,488.00 exceeded the annual income limit of $11,830.00. In December 2010 the Veteran submitted a Medical Expense Report (VA Form 21-8416), upon which he reported total year 2009 expenses as follows: $ 1,028.00 Medicare Part B $ 105.66 Private medical insurance [accident] $ 2,476.20 Dental $ 400.61 Pharmacy $ 142.00 Vision $ 270.00 Chiropractic $ 279.35 Mental Health Doctor visits $ 200.00 mileage, to & from offices Along with the December 2010 Medical Expense Report (VA Form 21-8416), the Veteran submitted the following documents: o a Social Security Benefit Statement dated December 2, 2010, which shows "Benefits for 2009" of $13,492.80 ($12,336.00 plus $1,156.80 for Medicare Part B); o a record of his (The Hartford) Life Insurance premiums, which reflects a premium amount of $6.60 a month [for a total of 79.20 per annum]; o a record of his (The Hartford) Health Insurance premiums, which reflects a premium amount of $8.20 a month [for a total of 98.40 per annum]; o a December 8, 2010, itemized printout of dental charges, which shows that the Veteran made the following payments: $ 99.00 September 25, 2009 $ 50.20 September 2, 2009 $ 65.00 July 15, 2009 $ 790.00 May 13, 2009 $ 572.00 April 8, 2009 $ 465.00 March 25, 2009 $ 305.00 March 11, 2009 $ 65.00 January 28, 2009 $ 65.00 January 21, 2009 o A December 3, 2010, itemized printout of pharmacy charges, which shows that the Veteran made the following payments: $ 7.00 July 14, 2009 $ 28.00 January 20, 2009 $ 28.00 April 27, 2009 o a VA HRC printout dated December 3, 2010, which shows that the Veteran made the following payments: $ 80.00 January 12, 2009 $ 130.00 February 12, 2009 $ 45.00 March 23, 2009 $ 80.00 April 10, 2009 $ 30.00 May 12, 2009 $ 15.00 May 15, 2009 $ 5.00 May 18, 2009 $ 45.00 June 8, 2009 $ 65.00 July 24, 2009 $ 60.00 August 14, 2009 $ 60.00 September 14, 2009 $ 15.00 October 13, 2009 o a December 2, 2010, printout of vision care charges, which shows that the Veteran paid $142.00 for services rendered on August 14, 2009. o a December 2, 2010, itemized printout of chiropractic charges, which shows that the Veteran made the following payments: $ 30.00 February 2, 2009 $ 30.00 February 26, 2009 $ 60.00 May 11, 2009 $ 3 0.00 July 2, 2009 $ 30.00 August 13, 2009 $ 30.00 August 27, 2009 $ 30.00 September 21, 2009 $ 30.00 October 8, 2009 o an itemized printout from MPMG (a physicians medical group), which shows that the Veteran made the following payments: $ 10.00 January 6, 2009 $ 10.00 January 15, 2009 $ 10.00 January 20, 2009 $ 25.00 March 2, 2009 $ 10.00 March 2, 2009 $ 10.00 March 30, 2009 $ 10.00 April 20, 2009 $ 25.00 May 12, 2009 $ 25.00 May 21, 2009 $ 25.00 May 22, 2009 $ 10.00 July 6, 2009 $ 10.00 July 14, 2009 $ 19.35 August 3, 2009 $ 10.00 August 20, 2009 $ 25.00 August 31, 2009 $ 10.00 September 29, 2009 $ 25.00 October 6, 2009 $ 10.00 November 2, 2009 and o a December 20, 2001, Vocational Rehabilitation Eligibility Certification record In documentation dated February 9, 2011, the Social Security Administration notified VA that the Veteran was receiving $1,124.50 per month (which equates to $13,494.00 per annum), less $96.50 per month for Supplementary Medical Insurance (SMI); and that he had been since December 2008. In a decision by letter dated February 14, 2011, the RO advised the Veteran that he was ineligible for nonservice-connected pension because his annual income of $ 12, 749.40 exceeded the annual income limit of $11,830.00. The RO added that it could not consider medical expenses incurred prior to the date of the Veteran's November 2009 claim. Analysis Preliminarily, the Board notes that the applicable timeframe for consideration for the claim for pension submitted by the Veteran on November 24, 2009, is the twelve months following receipt of claim; which, in this case, is November 24, 2009, through November 24, 2010. The maximum annual pension rate (MAPR) was $11,830.00. According to the Veteran, he had income in November 2009 of $13,492.80 from Social Security. Although no medical expenses dated after November 24, 2009, were reported, the Board finds it reasonable that, in addition to monthly Medicare Part-B payments of $96.50 ($1,156.80 per annum), the Veteran had recurring medical expenses of $ 98.40 per annum ($8.20 a month) to The Hartford for Health Insurance premiums. Accordingly, based on the evidence of record the Veteran's income was excessive for the receipt of VA pension at the time of his November 24, 2009, initial claim for pension. At that time he reported income of $13,492.80; and qualifying unreimbursed medical exclusions of $664.20 ($1,156.80 in Medicare Part-B payments per annum [$96.40 per month], plus $98.40 in The Hartford health insurance premiums per annum [$8.20 a month], minus $591.00 [5 percent of the applicable MAPR of $11,830.00]), for countable annual income for VA pension purposes, during the applicable timeframe August 31, 2011, to August 31, 2012, of $12,828.60. {13492.80 - [(1156.80+98.40) - 591]=12828.60}. As the Veteran's countable annual income of $12,828.60 exceeded the applicable MAPR of $11,830.00, the criteria for VA improved pension payments were not met. B. August 31, 2011, Improved Pension Eligibility Verification Report Facts On August 31, 2011, the Veteran submitted a VA Form 21-0516-1 (Improved Pension Eligibility Verification Report) which reflects total income of $13,308.00 ($1,028.00 per month from Social Security plus an $81.00 monthly annuity). No medical expenses were reported. In a rating decision dated in April 2013, the RO denied entitlement to pension. Analysis First, as the Veteran's August 31, 2011, Improved Pension Eligibility Verification Report (VA Form 21-0516-1) was not submitted in support of a running award for VA pension, it is a reopened claim, so the applicable timeframe for consideration of this new claim is the twelve months following the date of pension entitlement; which, in this case, is August 31, 2011, through August 31, 2012. See M21-1, Part V, Subpart iii, Chapter 1, Section A.3.c. The MAPR was $11,830.00. Next, the Board notes that the $1,028.00 per month in Social Security payments reported by the Veteran in his August 31, 2011, Improved Pension Eligibility Verification Report is not the actual amount of his monthly Social Security payments, as it does not reflect the $96.50 withheld each month by Social Security for Medicare Part-B payments. See February 9, 2011, Social Security Administration benefit document, which reflects that the Veteran was being paid $1,124.50 per month, from which the agency was deducting $96.50 per month in SMI, for a net distribution to the Veteran of $1,028.00. Additionally, while no medical expenses were reported in conjunction with the August 31, 2011, submission, based on the evidence received from the Veteran in 2010 and the information from Social Security, it may be concluded than in addition to Medicare Part-B payments, the Veteran had recurring medical expenses of $98.40 per annum ($8.20 a month) to The Hartford for Health Insurance premiums. With regard to the other medical expenditures (primary care physician co-pays, dental, pharmacy, vision care, chiropractic, and mental health care) reported by the Veteran in December 2010, they are not recurrent because, unlike the Social Security and private health insurance premiums, they are not fixed in amount and occurrence. As for the life insurance premiums reported by the Veteran in December 2010, these do not qualify as a medical expense for VA pension purposes, as the pension program is not intended to protect substantial assets or build up the beneficiary's estate for the benefit of heirs. See M21-1, Part V, Subpart iii, Chapter 1, Section A.1.e. Accordingly, based on the evidence of record, the Veteran had annual income at the time of his August 31, 2011, submission of $13,802.80 ($1,124.40 per month from Social Security [$13,492.80 per annum] plus $81.00 per month [$972.00 per annum] from a private annuity); and qualifying unreimbursed medical exclusions of $662.20 ($1,156.80 per annum [$96.40 per month] in Medicare Part-B payments, plus $98.40 per annum [$8.20 a month] to The Hartford for health insurance premiums, minus $591.00 [5 percent of the applicable MAPR of $11,830.00]), for countable annual income for VA pension purposes, during the applicable timeframe August 31, 2011, to August 31, 2012, of $13,929.40. As the Veteran's countable annual income of $13,929.40 exceeded the applicable MAPR of $11,830.00, the criteria for VA improved pension payments were not met. C. March 14, 2014, Improved Pension Eligibility Verification Report Facts On March 14, 2014, the Veteran submitted another VA Form 21-0516-1 (Improved Pension Eligibility Verification Report), in which he reported income of $1,080.00 per month from Social Security, plus $81.29 from a private monthly annuity; annual interest income of $162.00 from January 1, 2013, to December 31, 2013; and annual interest income from January 1, 2014, to December 31, 2014, of $162.00. He also reported the following medical payments: $ 200.00 for Urgent Care/Emergency ambulance on June 25, 2013 $ 84.83 per month for Medicare Part B [$1,017.96 per annum]; $ 25.95for pharmacy "Maintenance medications-1," dating from January to May 2013 $ 37.00 per month for pharmacy, "Maintenance medications-2," dating from May to December 2013 $ 257.00 x 5, in dental fees, dating from January through March 2013 $ 15.00 x 4, in chiropractic fees, dating from June through September 2013 a single $10.00 payment, and eleven $5.00 payments, in personal physician fees, dating from January through December 2013 $ 46.00 for eyewear repair in October 2013 $ 512.00 for a hearing aide device in April 2013 $ 50.00 in Urgent Care Hospital fees in May 2013 $ 200.00 for inpatient hospital fees in July 2013 $ 58.80 for an audio test fee in February 2013 In or around December 2013, the Social Security Administration notified VA that the Veteran was receiving $1,202.90 per month (which equates to $14,434.80 per annum), less $104.90 per month for SMI; and that he had been since December 2013. In a decision by letter dated April 17, 2014, the RO advised the Veteran that he was ineligible for nonservice-connected pension because his annual income of exceeded the annual income limit. Analysis Since the Veteran's March 14, 2014, Improved Pension Eligibility Verification Report (VA Form 21-0516-1) was not submitted in support of a running award for VA pension, it is a reopened claim, so the applicable timeframe for consideration of this new claim is the twelve months following the date of pension entitlement; which, in this case, is March 14, 2014, through March 14, 2015. See M21-1, Part V, Subpart iii, Chapter 1, Section A.3.c. The MAPR was $12,652.00. Next, while none of the medical expenditures reported by the Veteran in his March 2014 submission occurred during the timeframe March 14, 2014, to March 14, 2015, based on the information from the Social Security Administration (which informs of monthly Medicare Part-B payments), it may be concluded that the Veteran had recurring medical expenses of $104.90 per month in Medicare Part-B payments between March 14, 2014, to March 14, 2015; for a total of $1,258.80. Accordingly, based on the evidence of record, the Veteran had annual income at the time of his March 14, 2014, submission of $15,572.28 ($1,202.90 per month [$14,434.80 per annum] from Social Security; plus $81.29 per month [$975.48 per annum] from a private annuity; plus annual interest income of $162.00); and qualifying unreimbursed medical exclusions of $626.80 ($104.90 per month [$1,258.80 per annum] in Medicare Part-B payments, minus $632.00 [5 percent of the applicable MAPR of $12,652.00]), for countable annual income for VA pension purposes, during the applicable timeframe March 14, 2014, to March 14, 2015, of $14,945.48. As the Veteran's countable annual income of $14,945.48 exceeded the applicable MAPR of $12,652.00, the criteria for VA improved pension payments were not met. D. May 12, 2014, Improved Pension Eligibility Verification Report Facts On May 12, 2014, the Veteran submitted another VA Form 21-0516-1 (Improved Pension Eligibility Verification Report), in which he reported Social Security income of $1,080.00 per month, plus $81.29 per month from a private annuity; plus $162.00 annual interest income from January 1, 2013, to December 31, 2013; and annual interest income from January 1, 2014, to December 31, 2014, of $162.00. He reported recurrent medical expenses of $84.83 per month [$1,017.96 per annum] for Medicare Part B He also submitted the following: o an invoice showing that the Veteran had paid $200 for ambulance transport on March 17, 2013 o an April 30, 2014, pharmacy record, which shows that the Veteran made total payments of $222.78 during the date range January 1, 2013, to December 31, 2013. o a May 1, 2014, itemized printout of dental charges, which shows that the Veteran made the following payments: $ 370.00 March 19, 2013 $ 670.00 March 26, 2013 $ 75.00 September 18, 2013 $ 170.00 October 11, 2013 o a May 5, 2014, itemized printout of chiropractic charges, which shows that the Veteran made the following payments: $ 15.00 January 17, 2013 $ 15.00 April 17, 2013 $ 15.00 July 3, 2013 $ 15.00 September 24, 2013 o a receipt for $46.00 for eyewear repair on October 21, 2013 o an invoice showing that the Veteran had paid $405.00 for a hearing aide device in April 2013 o an invoice showing that the Veteran had paid $50.00 payment for hospital stay from March 17, 2013 to March 19, 2013 o an April 30, 2014, itemized printout of doctor visits, which shows that the Veteran made the following payments: $ 5.00 February 5, 2013 $ 5.00 February 12, 2013 $ 5.00 February 19, 2013 $ 5.00 March 22, 2013 $ 5.00 May 28, 2013 $ 10.00 May 29, 2013 $ 5.00 July 15, 2013 $ 5.00 August 8, 2013 $ 5.00 August 16, 2013 $ 5.00 August 29, 2013 $ 5.00 October 11, 2013 $ 5.00 November 12, 2013 $ 5.00 November 26, 2013 $ 5.00 December 2, 2013 $ 5.00 December 19, 2013 $ .37 December 19, 2013 $ 5.00 January 13, 2014 $ 5.00 February 14, 2014 o an invoice showing that the Veteran had paid $58.80 for a hearing aid evaluation in March 2013 In a decision by letter dated July 18, 2014, the RO advised the Veteran that he was ineligible for nonservice-connected pension because his annual income exceeded the annual income limit. Analysis Although the May 12, 2014, Improved Pension Eligibility Verification Report (VA Form 21-0516-1) was not submitted in support of a running award for VA pension, it was submitted within two months after the March 14, 2014, submission, and may be considered in connection with that. For this period, the applicable MAPR is $12,652.00. Apart from recurrent Medicare Part-B payments, none of the medical expenditures reported by the Veteran in his May 12, 2014, Improved Pension Eligibility Verification Report occurred after March 14, 2014; much less after May 2014. Moreover, despite the Veteran's report of $1,080.00 per month in Social Security payments, the Social Security Administration advises that the Veteran has had monthly payments of $1,202.90 per month (which equates to $14,434.80 per annum), less $104.90 per month for SMI, since December 2013. Accordingly, based on the evidence of record, the Veteran had annual income at the time of his May 12, 2014, Improved Pension Eligibility Verification Report (VA Form 21-0516-1) submission of $15,572.28 ([$1,202.90 per month [$14,434.80 per annum] from Social Security; plus $81.29 per month [$975.48 per annum] from a private annuity; plus annual interest income of $162.00); and qualifying unreimbursed medical exclusions of $626.80 ($104.90 per month [$1,258.80 per annum] in Medicare Part-B payments, minus $632.00 [5 percent of the applicable MAPR of $12,652.00]), for countable annual income for VA pension purposes, during the applicable timeframe March 14, 2014, to March 14, 2015, of $14,945.48. As the Veteran's countable annual income of $14,945. 48 exceeded the applicable MAPR of $12,652.00, the criteria for VA improved pension payments were not met. III. Summary In sum, the Veteran meets the service and age requirements for a VA nonservice-connected improved pension; however, based on the evidence of record, VA pension income limits requirements were not met during the timeframes under review in this decision. ORDER Entitlement to VA nonservice-connected improved pension payments is denied. ____________________________________________ MICHAEL E. KILCOYNE Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs