Citation Nr: 1715310 Decision Date: 05/08/17 Archive Date: 05/22/17 DOCKET NO. 16-05 762 ) DATE ) ) On appeal from the Pension Management Center in St. Paul, Minnesota THE ISSUE Entitlement to a higher rate of special monthly pension. ATTORNEY FOR THE BOARD R. Behlen, Associate Counsel INTRODUCTION The appellant served on active duty in the Army from January 1945 to November 1948. This matter comes to the Board of Veterans' Appeals (Board) from a June 2015 rating decision of the Department of Veterans Affairs (VA) Pension Management Center (PMC) in Milwaukee, Wisconsin, which granted special monthly pension based on the need for aid and attendance, effective May 11, 2015. The effective date was changed to April 8, 2014, in October 2015. The appellant filed a timely Notice of Disagreement (NOD), received in September 2015, in which he explained that he had expected a larger monthly pension payment. The Agency of Original Jurisdiction (AOJ) issued a Statement of the Case (SOC) in November 2015. The appellant timely filed a VA Form 9, received in February 2016. A motion to advance this appeal on the Board's docket has been raised by the Board's Acting Vice Chairman. The undersigned is granting the motion and advancing the appeal on the docket based upon advanced age. 38 C.F.R. § 20.900(c) ("advanced age" is defined as 75 or more years of age). FINDINGS OF FACT 1. The appellant has been awarded special monthly pension based on the need for aid and attendance, effective April 8, 2014. 2. The rate of the appellant's special monthly pension was awarded at the Maximum Annual Pension Rate minus his annualized countable family reduced by unreimbursed medical expenses. CONCLUSION OF LAW The rate of the appellant's special monthly pension based on the need for aid and attendance is the maximum amount allowable under law. 38 U.S.C.A. §§ 501, 1503, 1521, 1541, 5109A, 5312, 7105(d) (West 2012); 38 C.F.R. §§ 3.3(a) (3), 3.21, 3.23, 3.271, 3.272, 3.273. 3.2600 (2016). REASONS AND BASES FOR FINDINGS AND CONCLUSION I. Veterans Claims Assistance Act of 2000 (VCAA) As a preliminary matter, the Board finds that no further notice or development action is necessary in order to satisfy VA's duties to the appellant under the VCAA. The appellant has not argued otherwise. Scott v. McDonald, 789 F.3d 1375 (Fed. Cir. 2015). The appellant's claim for pension, filed as a Fully Developed Claim, was received in May 2015. However, because the RO determined that the appellant's claim required additional information, it sent the appellant a letter in May 2015 that notified the appellant of the information and evidence that was still required in order to make a determination on the claim. Further, the appellant's claim was granted in full. The Board also notes that, in the November 2015 SOC, the appellant was provided with an explanation of how the rate of pension is calculated. Under the VCAA, VA also has a duty to assist claimants in obtaining evidence needed to substantiate a claim, unless no reasonable possibility exists that such assistance would aid in substantiating the claim. 38 U.S.C.A. § 5103A; 38 C.F.R. § 3.159(c). In this case, the record indicates that the appellant was found eligible for pension for aid and attendance with no dependents, the highest level of pension available to the appellant. Moreover, as set forth in more detail below, the pertinent facts in this case are not in dispute, and the appeal must be denied as a matter of law. Thus, any deficiency in VA's notice or development action is harmless error. Pratt v. Nicholson, 20 Vet. App. 252 (2006); Dela Cruz v. Principi, 15 Vet. App. 143 (2001) (holding that the VCAA is not applicable to matters in which the law, and not the evidence, is dispositive). II. Applicable Law A. Pension Pursuant to 38 U.S.C.A. § 1521(a), pension is payable to a veteran of a period of war who is permanently and disabled from nonservice-connected disability not the result of his or her own willful misconduct. Basic entitlement exists if, among other things, such veteran's income is not in excess of the applicable Maximum Annual Pension Rate specified in 38 C.F.R. § 3.23. See 38 U.S.C.A. §§ 1503, 1521; 38 C.F.R. §§ 3.3, 3.23. Payments of VA nonservice-connected pension benefits are made at the specified maximum annual rate, reduced on a dollar-for-dollar basis by annualized countable family income. Payments of any kind, from any source, shall be counted as income during the 12-month annualization period in which received, unless specifically excluded. 38 C.F.R. §§ 3.271, 3.272. Unreimbursed medical expenses, which were paid within the twelve-month annualization period regardless of when incurred, are excluded from annual countable income to the extent that the amount paid exceeds five percent of the regular maximum annual rate payable to a single veteran (excluding increased pension because of the need for aid and attendance). 38 C.F.R. § 3.272. The rates of pension are published in tabular form in Appendix B of the Veterans Benefits Administration Manual M21-1, and are given the same force and effect as if published in the Code of Federal Regulations. The Maximum Annual Pension Rate is adjusted from year to year. 38 C.F.R. § 3.21. The applicable Maximum Annual Pension Rate is higher if the claimant is in need of the regular aid and attendance of another person. See 38 U.S.C.A. § 1541(a) (West 2002); 38 C.F.R. § 3.3(b) (2016); see also Veterans Benefits Administration Manual M21-1, Part I, Appendix B. B. Purpose of Pension The nonservice-connected disability pension program is an income-based benefit. It is not intended to protect substantial gains in income or assets. By law VA must reduce pension benefits by the gross amount of countable family income received. As described above, VA is able to reduce countable family income by unreimbursed family medical expenses. Pension is based upon severity of disability only insofar as there is a higher rate available for a housebound veteran or a veteran who requires aid and attendance. The number of dependents that a veteran has also affects the amount of pension received. Conversely, compensation for disability evaluations for service-connected disabilities is determined by the application of a schedule of ratings which is based on average impairment of earning capacity. 38 U.S.C.A. § 1155; 38 C.F.R. Part 4. If a veteran has been 1) granted entitlement to service connection for a disability and been assigned a particular rating; and 2) that veteran believes that the service-connected disability has increased in severity or was not rated properly; then 3) the rating may be appealed, or a claim for an increased rating may be filed, depending upon how long the rating has been in effect. C. Maximum Annual Pension Rates Effective December 1, 2013, the Maximum Annual Pension Rate for a veteran with no dependents was $12,652. Effective December 1, 2014, the Maximum Annual Pension Rate for a veteran with no dependents was $12,868. Effective December 1, 2016, the Maximum Annual Pension Rate for a veteran with no dependents was $12,907. See M21-1, Part I, Appendix B. Effective December 1, 2013, the Maximum Annual Pension Rate for a housebound veteran with no dependents was $15,462. Effective December 1, 2014, the Maximum Annual Pension Rate for a housebound veteran with no dependents was $15,725. Effective December 1, 2016, the Maximum Annual Pension Rate for a housebound veteran with no dependents was $15,773. See Id. Effective December 1, 2013, the Maximum Annual Pension Rate for a veteran requiring aid and attendance with no dependents was $21,107. Effective December 1, 2014, the Maximum Annual Pension Rate for a veteran requiring aid and attendance with no dependents was $21,466. Effective December 1, 2016, the Maximum Annual Pension Rate for a veteran requiring aid and attendance with no dependents was increased to $21,531. See Id. D. Calculation of Maximum Annual Pension Rate The Maximum Annual Pension Rate for a veteran requiring aid and attendance with no dependents would be paid to an eligible veteran with no other source of income. As explained above, annualized countable income, which includes monthly payments from SSA, is subtracted from the Maximum Annual Pension Rate in order to determine how much a veteran's pension will be for a given year. For example, the Maximum Annual Pension Rate for aid and attendance for a veteran with no dependents who received $5,000 annually from SSA would receive $16,531 annually. The Maximum Annual Pension Rate for aid and attendance for a veteran with no dependents who received $20,000 annually from SSA would receive $1,531 annually. As discussed above, if a veteran has unreimbursed medical expenses paid within the twelve-month annualization period, the total expenses in excess of five percent of the maximum annual rate payable to a veteran ($12,907 for a veteran with no dependents, five percent of which is $645, effective Dec. 1, 2016) are excluded from annual countable income. For example, if a veteran requiring aid and attendance with no dependents received $5,000 annually from SSA and had unreimbursed medical expenses of $600, he would receive $16,531. This is because $600 of unreimbursed medical expenses is less than five percent of the maximum annual rate payable to a single veteran ($645). If a veteran requiring aid and attendance with no dependents received $5,000 annually from SSA and had unreimbursed medical expenses of $1,000, he would receive $16,886. The veteran's annual countable income would be $4,645, the difference of the $5,000 from SSA and $355 of unreimbursed medical expenses (itself the difference of the $1,000 of unreimbursed medical expenses and $645). The sum of the $16,886 pension and the $4,645 annual countable income is $21,531, the Maximum Annual Pension Rate. Just as unreimbursed medical expenses are credited against annual countable income, the cost of Medicare is credited as well. See M21-1, Part I, Appendix B. Effective December 1, 2012, the Standard Medicare Deduction was $104.90 per month. Effective December 1, 2016, the Standard Medicare Deduction is determined by SSA based on individual income. III. Background The appellant submitted an application for VA pension benefits, received in May 2015. In this application, the appellant reported his net worth and his expected income, including his monthly SSA payment and interest income. The AOJ, after verifying the appellant's income, awarded special monthly pension based on the need for aid and attendance at the rate of $757 monthly. The rate was calculated by subtracting the appellant's countable family income, reduced by unreimbursed medical expenses exceeding five percent of the MAPR, from the MAPR. VA notified the appellant in a July 2015 letter of the amount of his monthly pension payment. This letter also explained that the payment would begin the first day of the month following the effective date, in this case June 1, 2015. In September 2015, the appellant disagreed with the AOJ's determination, stating, in pertinent part, that he believed that he was eligible for a larger monthly pension payment than received. He explained that he had been previously advised that he would be eligible for approximately $1700 monthly. In October 2015, entitlement to an earlier effective date, April 8, 2014, for aid and attendance benefits was granted by the AOJ. Income verification was also performed in October 2015. The results were identical to the July 2015 verification. The AOJ sent the appellant a letter in October 2015 notifying him of changes to the monthly pension amount based on a cost of living adjustment, changes to the appellant's countable income, and changes to his net worth. An SOC was issued in November 2015, in which the AOJ explained that the disability pension program is an income-based benefit. By law VA must reduce pension benefits by the gross amount of countable family income received, minus unreimbursed family medical expenses in excess of five percent of the MAPR. The AOJ then explained in detail how it calculated the appellant's monthly payments, taking into account the appellant's SSA monthly payments, annual interest income, and family medical expenses in excess of the standard five percent deduction (at that time $643). The appellant submitted a VA Form 9, received in February 2016, in which he noted that he believed his health had deteriorated to that point that he was 100 percent disabled, needed further financial assistance, and that his private physician had requested a motorized wheelchair for him. He also included a copy of the 2014 VA Improved Pension Payment Table, on which he noted that his annual payment was less than the total amount listed for a veteran requiring aid and attendance with no dependents. IV. Analysis As discussed above, the Maximum Annual Pension Rate is only the amount of pension a veteran will receive if he has no other income for VA purposes. The Maximum Annual Pension Rate for a veteran requiring aid and attendance with no dependents ($21,531 effective Dec. 1, 2016) is higher than that for a veteran with no dependents ($12,907) or for a housebound veteran with no dependents ($15,725). A review of the record indicates that the appellant is being paid as a veteran requiring aid and attendance with no dependents. This is the most beneficial nonservice-connected pension for which the appellant is eligible. The appellant reported his monthly SSA payment amount, interest income, and unreimbursed medical expenses to VA. VA verified this income with SSA. VA totaled his income, deducted his Medicare premium, and credited him for his unreimbursed medical expenses in excess of the five percent regular maximum annual rate payable to a single veteran in order to determine his annualized countable family income. Then VA subtracted the appellant's annualized countable family income from the Maximum Annual Pension Rate to calculate the appellant's pension. As noted above, the appellant's annual countable income would be the same whether Medicare Part B costs were included with the SSA payment and later deducted or omitted entirely, as the appellant had done. The record does not show, nor does the appellant contend, that the AOJ's calculations were incorrect. Rather, the confusion in this case appears to stem from the difference between compensation for service-connected disability and nonservice-connected pension. Compensation for a service-connected disability is determined by the application of a schedule of ratings which is based on average impairment of earning capacity. Nonservice-connected pension is not based upon average impairment of earning capacity; rather, it is a needs-based program based on countable family income. The appellant is receiving nonservice-connected pension at the aid and attendance rate. He is receiving the most beneficial nonservice-connected pension for which he is eligible. His annualized countable family income, the amount of which is not in dispute, is by law subtracted from the Maximum Annual Pension Rate in order to determine his pension payment, as discussed above. In other words, there is no legal basis upon which to award a higher rate of pension based on the undisputed facts in this case. Although a Veteran needing aid and attendance who had no income from any source would, in fact, be eligible for approximately $1700 in special monthly pension (i.e. the MAPR divided by 12), because the appellant receives interest income and SSA income, such income must be subtracted from the MAPR in calculating his monthly rate. To the extent the appellant argues that he is entitled to a higher rate of pension because he was advised by a VA employee that he was eligible to receive $1700 monthly, the U.S. Court of Appeals has held that erroneous advice given by a government employee cannot be used to estop the government from denying benefits. Thus, even assuming that the appellant was given incorrect information by a VA employee regarding the rate of his pension, that fact does not provide a basis on which to grant the appeal. See Harvey v. Brown, 6 Vet. App. 416, 424 (1994); see also Shields v. Brown, 8 Vet. App. 346, 351 (1995) (holding that inaccurate advice does not create any legal right to benefits where such benefits are otherwise precluded); McTighe v. Brown, 7 Vet. App. 29, 30 (1994) (holding that erroneous advice given by a government employee cannot be used to estop the government from denying benefits). Rather, the Board is bound by the applicable law and regulations and is without authority to grant benefits on an equitable basis. 38 U.S.C.A. §§ 503, 7104(c) (West 2014). No equities, no matter how compelling, can create a right to payment out of the United States Treasury that has not been provided for by Congress. See OPM v. Richmond, 496 U.S. 414, 434 (1990). The Board notes the appellant's statements regarding his deteriorating health. If the appellant contends that any of the disabilities from which he currently suffers were caused by or incurred in his active duty service, he may file a claim of entitlement to service connection on the proper form. The appellant may wish to discuss his options with a representative from a Veterans Service Organization. ORDER Entitlement to a higher rate of special monthly pension is denied. ______________________________________________ K. Conner Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs