Citation Nr: 1803148 Decision Date: 01/17/18 Archive Date: 01/29/18 DOCKET NO. 16-22 704 ) DATE ) ) On appeal from the Department of Veterans Affairs Pension Management Center in St. Paul, Minnesota THE ISSUE Whether VA was correct to deny entitlement to death pension with aid and attendance based on countable income from April 1, 2010 to February 1, 2015. REPRESENTATION Appellant represented by: [REDACTED], Representative ATTORNEY FOR THE BOARD N. Robinson, Associate Counsel INTRODUCTION The Veteran served on active duty from February 1941 to November 1945. The appellant is his surviving spouse. This matter is before the Board of Veterans' Appeals (Board) on appeal from a March 2015 rating decision by the Phoenix, Arizona Department of Veterans Affairs (VA) Regional Office (RO), which granted entitlement to aid and attendance allowance effective January 26, 2015, and an April 2015 decisional letter which denied benefits based on excessive income. This matter is now before the Pension Management Center (PMC) in St. Paul, Minnesota. In August 2017, the Board remanded this matter for additional development. In September 2017, the PMC granted death pension and aid and attendance benefits effective February 1, 2015. This appeal has been advanced on the Board's docket pursuant to 38 C.F.R. § 20.900(c) (2017). 38 U.S.C. § 7107(a)(2) (2012). FINDINGS OF FACT 1. From March 23, 2010 to March 31, 2010, the appellant received $13,650 in Social Security Administration (SSA) income, and $1258.80 of reported medical expenses; her countable income for VA purposes exceeds the limit for that year. 2. In the 2011 calendar year, the appellant received $13,650 in SSA income, and $1258.80 of reported medical expenses; her countable income for VA purposes exceeds the limit for that year. 3. In the 2012 calendar year, the appellant received $14,134.80 in SSA income, and $1258.80 of reported medical expenses; her countable income for VA purposes exceeds the limit for that year. 4. In the 2013 calendar year, the appellant received $14,374.80 in SSA income, and $1258.80 of reported medical expenses; her countable income for VA purposes exceeds the limit for that year. 5. There are sufficient grounds to find that "custodial care," as a defined under VA regulations, was needed from July 2014 forward. Therefore, independent living facility fees paid are reimbursable medical expenses, and the appellant's countable income does not exceed the pension limit from calendar year 2014 forward. 6. Prior to July 23, 2014, the evidence does not reasonably show that the appellant needed assistance with activities of daily living (ADLs), was housebound or bedridden, was in a nursing home, or had vision worse than 5/200 in both eyes. CONCLUSIONS OF LAW 1. From March 23, 2010 to March 31, 2011, and throughout the calendar years 2011, 2012, and 2013, the appellant's countable income exceeded the eligibility limit for pension benefits, and she did not meet the criteria for housebound status or aid and attendance. 38 U.S.C. §§ 101, 501, 1151, 1503, 1541 (2012); 38 C.F.R. §§ 3.2, 3.3, 3.23, 3.271, 3.272, 3.274, 3.275, 3.351, 3.352 (2017). 2. From July 2014 forward, the appellant's expenses in an independent living facility are custodial care and excludable from countable annual income for death pension benefits purposes. Accordingly, from January 1, 2014 forward, death pension is warranted. 38 U.S.C. §§ 101, 501, 1151, 1503, 1541 (2012); 38 C.F.R. §§ 3.2, 3.3, 3.23, 3.271, 3.272, 3.274, 3.275, 3.351, 3.352 (2017). 3. From July 23, 2014, the appellant is entitled to aid and attendance in addition to death pension. 38 U.S.C. §§ 101, 501, 1151, 1503, 1541 (2012); 38 C.F.R. §§ 3.2, 3.3, 3.23, 3.271, 3.272, 3.274, 3.275, 3.351, 3.352 (2017). REASONS AND BASES FOR FINDINGS AND CONCLUSIONS Neither the appellant nor her representative has raised concerns with the duty to notify. See 38 U.S.C. §§ 5102, 5103, 5103A (2012); 38 C.F.R. § 3.159; see also Scott v. McDonald, 789 F.3d 1375 (Fed. Cir. 2015). In January 2015, VA sent the appellant a letter requesting her to submit an aid and attendance examination report and explaining the requirements for death pension and increased benefits based on the need for aid and attendance. The Board notes that the appellant was afforded ample information regarding the applicable law and requirements for substantiating her claim in the April 2015 decisional letter, the April 2016 statement of the case (SOC), and the October 2017 supplemental statement of the case (SSOC). There also was the required compliance, certainly acceptable substantial compliance, with the Board's previous remand directives. See Stegall v. West, 11 Vet. App. 268 (1998) (where the remand orders of the Board are not complied with, the Board itself errs as a matter of law when it fails to ensure compliance); but see also D'Aries v. Peake, 22 Vet. App. 97, 105 (2008) (holding that "substantial" rather than strict compliance with the Board's remand directives is required under Stegall); accord Dyment v. West, 13 Vet. App. 141, 146-47 (1999). Legal Criteria Death pension is an incremental cash award provided to a family member of a deceased Veteran who had qualifying active service. The appellant is entitled to such if the Veteran served for 90 days or more AND if she meets specific income and net worth requirements. See 38 U.S.C. § 1541(a); 38 C.F.R. § 3.3(b)(4). Because the Veteran served on active duty for more than 90 days during World War II, death pension benefits are warranted if the appellant meets the income threshold requirements. A surviving spouse who meets the above-referenced requirements will be paid the maximum rate of death pension, reduced by the amount of countable income. 38 U.S.C. §1541; 38 C.F.R. § 3.23. "Countable family income" includes income from most sources, including any eligible dependents, received during the 12-month annualization period. Generally, it 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 that are in excess of five percent of the annual MAPR, may reduce countable income. 38 U.S.C. 1503(a); 38 C.F.R. §§ 3.260, 3.261, 3.262. The MAPRs are specified in 38 U.S.C. § 1521 and 1542, as increased from time to time under 38 U.S.C. § 5312. An additional amount is paid to a surviving spouse in need of aid and attendance. 38 C.F.R. § 3.23(a)(6). Regarding deductible medical expenses, independent living facility expenses may be deducted in certain circumstances. Specifically, the claimant must be rated for special monthly pension and the custodial care requirement (CCR) must be met. The CCR may be satisfied in one of two ways; either the claimant receives regular assistance with two or more activities of daily living (ADLs) or the claimant receives regular supervision because she has a physical, mental, developmental, or cognitive disorder requiring care and assistance on a regular basis to be protected from hazards or dangers of her daily environment. VA's M21-1 Adjudication Procedures Manual M21-1, V.iii.1.G.3.e. Under M21-1, V.iii.1.G.3.f., ADLs are basic self-care activities, consisting of: bathing or showering; dressing; eating; getting in or out of bed or a chair, etc. ADLs do not include Instrumental Activities of Daily Living (IADLs). IADLs are activities other than basic self-care that are needed for independent living. Examples of IADLs include shopping; food preparation; housekeeping; laundering; handling medication, and using the telephone. I. Deduction of Independent Living Facility Expenses Factual Background The appellant has asserted that she is entitled to death pension benefits prior to February 1, 2015. The critical issue is whether her payments to her independent living facility may be deducted from her income. In other words, the question is whether she needed custodial care prior to February 1, 2015. A June 2010 note from Dr. W. S. states that she was seen in the office and may need help getting up. The note is difficult to read and not accompanied by a detailed examination report, list of medications, or diagnoses. During her March 2011 VA aid and attendance examination, the appellant reported maintaining hygiene without assistance, eating in the facility's dining area, and participating in scheduled group activities. The examiner found that the appellant could perform all self-care functions. She did not use an orthopedic or prosthetic appliance or need aid with ambulation. She reported walking up to 1/2 mile unassisted and was unrestricted in leaving home. Regarding her ability to protect herself from daily hazards, she denied dizziness, memory loss, or imbalance that affected her walking. On examination, her gait was normal and her vision was not worse than 5/200 in both eyes. She did have normal age-related cervical and thoracolumbar spine loss of motion. Her upper and lower extremity function was normal. She was capable of managing her financial affairs. Her medical diagnosis was high blood pressure. The examiner summarized, "other than prepared meals provided by the facility, [the appellant] functions relatively independently." During her July 2014 Board hearing on entitlement to accrued benefits, the appellant and her representative (her daughter) also provided lay evidence relevant to the issue on appeal here. The representative testified that the appellant was living in an independent living facility but received laundry service, cleaning service, and transportation for shopping and doctor's appointments. In a typical day, she eats three meals in the facility's dining room. She is sometimes a little unsteady on her feet, especially after an ankle fracture, so holds the railings while walking to the dining room. The representative denied noting any cognitive impairment. Overall, the representative indicated that the appellant's health was worse than it was during her March 2011 aid and attendance examination, and that while "her mind is still there, she cannot live on her own." Her medical conditions included high blood pressure and skin cancer. In a January 2015 letter, VA advised the appellant of the evidentiary requirements for death pension and aid and attendance claims. During her January 2015 private medical examination for aid and attendance purposes, the clinician noted the appellant was alert and oriented, appropriately dressed, and clean. Her musculoskeletal examination was notable for normal age-related deterioration of muscle size and girth. Her upper extremity strength was 3/5 with markedly decreased coordination. She could not firmly grasp with either hand. Her gait was steady. She was able to remember and answer questions appropriately. She was able to feed herself and is independent in toileting and grooming. She required assistance in dressing and bathing, and was unable to cook for herself. Her diagnoses were depression and hypertension. In a March 2015 rating decision, the RO granted entitlement to aid and attendance effective January 26, 2015, the date of her examination; however, the RO found that the appellant did not qualify for benefits because her income exceeded the death pension limit. In September 2017, the PMC granted death pension and aid and attendance benefits effective February 1, 2015 because the January 2015 examination report showed need for custodial care and recent VA guidance allows independent living facility expenses to be deducted from countable income if custodial care is needed. The October 2017 SSOC denied entitlement to these benefits prior to February 1, 2015 because the evidence did not show the appellant needed custodial care prior to the January 26, 2015 examination report. Analysis At the outset, the Board finds that the evidence summarized above reasonably supports a finding that the appellant needed custodial care as of the July 23, 2014 Board hearing. During the hearing, the appellant's representative testified that her mother's health had deteriorated since her prior VA aid and attendance examination. This testimony was substantiated by the January 2015 aid and attendance examination report showing need for assistance with bathing and dressing. See Swain v. McDonald, 27 Vet. App. 219 (2015) (holding that the effective date for an increased rating is based on when it is factually ascertainable that the disability worsened and not on the date of the examination that documented the worsening). Accordingly, the appellant's payments to her independent living facility may be deducted from her 2014 income for death pension purposes, which reduces her countable income to below the threshold needed to receive pension and aid and attendance. Therefore, a grant of death pension effective January 1, 2014 is warranted. In addition, aid and attendance is warranted, effective July 23, 2014 (the date the evidence reasonably shows the appellant's need for aid and attendance). Prior to July 23, 2014, the Board finds that the evidence does not reasonably show that the appellant needed custodial care or qualified for aid and attendance. The evidence from this period includes the June 2010 physician note and the 2011 VA examination report. The examination report, as summarized in detail above, indicates that the appellant was independent with activities of daily living and lived essentially independently except for eating meals in the facility's dining hall. Specifically, the physician noted that she was independent with hygiene, dressing, bathing, and feeding. In addition, the examiner opined, based on the examination and interview, that she did not need protection from the hazards of her environment. The examiner found her cognitively intact and overall stated that she was living independently except for meal preparation. The June 2010 physician's note appears to indicate that the appellant may have needed assistance getting up, but this note is not accompanied by a detailed physical examination, and this finding is not shown in the 2011 VA examination. In contrary, the VA examiner found that the appellant had a normal gait, did not need assistance walking, and was unrestricted in leaving home. Therefore, the Board assigns more probative weight to the VA examination report and finds that the evidence does not show required custodial care prior to July 2014. The Board also finds that the evidence does not show need for aid and attendance prior to July 2014 because there is no evidence the appellant was bedridden, a patient in a nursing home, or had vision limited to 5/200 or less in both eyes. Accordingly, her independent living expenses may not be deducted from her income for calendar years 2013 and earlier. In summary, the Board is granting death pension, effective January 1, 2014, and aid and attendance, effective July 23, 2014. II. Pension Eligibility prior to Calendar year 2014 The remaining issue is whether the appellant otherwise qualifies for pension based on her documented income and deductible medical expenses prior to January 1, 2014. Although her independent living facility expenses may not be deducted, the appellant could still qualify for pension if her countable income is below the annual pension limit. After a careful review of the evidence, the Board finds that the appellant's income exceeds the maximum set by law and therefore that entitlement to a death pension and aid and attendance prior to July 1, 2014 must be denied. The Initial Year: March 23, 2010 to March 30, 2011 The evidence shows her monthly income from SSA was $1137.50, equaling $13,650 annually. Her Medicare monthly premium rate was $104.90, equaling $1258.80 annually. Accordingly, $1258.80 - $397 (five percent of the MAPR) = $861 may be deducted from her countable income, equaling $12,789. Her countable income is further decreased by reported final expenses of $1150.00 ($1450 minus the $300 VA burial benefit). Therefore, her countable income for the initial year is $11,639 and exceeds the pension limit of $7933. Calendar Year 2011 The evidence shows that her monthly income from SSA was $1137.50, equaling $13,650 annually. Her Medicare month premium rate was $104.90, equaling $1258.80, annually. Accordingly, $1258.80 - $410 (five percent of MAPR) = $848.80 may be deducted from her countable income. Therefore, her countable income is $13,650 - $848.80 = $12,801.20 and exceeds the pension limit of $8219. Calendar Year 2012 The evidence shows that her monthly income from SSA was $1177.90, equaling $14,134.80 annually. Her Medicare monthly premium rate was $104.90, equaling $1258.80 annually. Accordingly $1258.80 - $417 (five percent of MAPR) = $841.80 may be deducted from her countable income. Therefore, her countable income is $14,134.80 - $841.80 = $13,293 and exceeds the pension limit of $8359. Calendar Year 2013 The evidence shows that her monthly income from SSA was $1197.90, equaling $14,374.80 annually. Her Medicare monthly premium rate was $104.90, equaling $1258.80 annually. Accordingly, $1258.80 - $424 (five percent of MAPR) = $834.80 may be deducted from her countable income. Therefore, her countable income is $14,374.80 - $834.80 = $13,540 and exceeds the pension limit of $8485. Calendar Year 2014 The evidence shows that her monthly income from social security was $1214.90, equaling $14,578.80 annually. Her Medicare monthly premium rate was $104.90, equaling $1258.80 annually. In addition, pursuant to the Board's analysis above, the July through December monthly payments ($1950 x 6 months = $11,700) at her facility may be deducted. Therefore, her total deductible expenses of $12,958- $431 (five percent of MAPR) = $12,527 may be deducted from her income, equaling $2051.80 of countable income. The evidence shows that she may have also been in receipt of a separate $495 monthly civil service retirement benefit (although this has not been confirmed by the appellant); however, even so (and this benefit should be confirmed by the PMC before her pension amount is calculated) , her income would fall below the pension limit for this year. As discussed above, she therefore qualifies for death pension for this year. Pursuant the analysis above, she does not qualify for aid and attendance until July 23, 2014 because the medical evidence does not show that she was housebound or otherwise qualified for aid and attendance until that date. January 2015 Death pension and aid and attendance are warranted for January 2015 because the appellant may deduct her $2030 independent living facility fee from her income. Accordingly, her countable income is below the required limit, and pension and aid and attendance are also granted for this month. In August 2017, the Board remanded this matter in part to allow the appellant to submit additional documentation of her medical expenses. No additional information was submitted. Accordingly, the evidence supports a grant of death pension, effective January 1, 2014, and aid and attendance, effective July 23, 2014, but does not support an earlier grant of either benefit due to the appellant's income exceeding the VA pension limit for those years. (CONTINUED ON NEXT PAGE) ORDER Entitlement to death pension is granted effective January 1, 2014, subject to the laws and regulations governing the award of monetary benefits. Entitlement to aid and attendance is granted effective July 23, 2014, subject to the laws and regulations governing the award of monetary benefits. Entitlement to death pension prior to January 1, 2014 and aid and attendance prior to July 23, 2014 is denied. ____________________________________________ VICTORIA MOSHIASHWILI Veterans Law Judge, Board of Veterans' Appeals Department of Veterans Affairs