Citation Nr: 18140160 Decision Date: 10/02/18 Archive Date: 10/02/18 DOCKET NO. 15-15 553 DATE: October 2, 2018 ORDER Entitlement to payment of death pension benefits is denied. FINDING OF FACT The appellant’s countable income exceeded applicable maximum annual pension rates. CONCLUSION OF LAW The criteria for entitlement to payment of death pension benefits based on the appellant’s countable income have not been met. 38 U.S.C. § 1541 (2012); 38 C.F.R. §§ 3.3, 3.23, 3.271, 3.272, 3.273 (2018). REFERRED The issue of entitlement to Special Monthly Pension based on the need for regular aid and attendance of another person was raised by a December 2013 examination and by an October 2014 statement and is referred to the Agency of Original Jurisdiction (AOJ) for adjudication. REASONS AND BASES FOR FINDING AND CONCLUSION Entitlement to death pension benefits Basic entitlement to pension exists if, among other things, the claimant’s income is not in excess of the maximum annual pension rate (MAPR) specified in 38 C.F.R. § 3.23. 38 U.S.C. § 1541 (2012); 38 C.F.R. § 3.3 (a)(3). The MAPR is published in Appendix B of the VA Adjudication Procedures Manual M21-1 and is given the same force and effect as if published in VA regulations. 38 C.F.R. § 3.21. The MAPR is revised every December 1st and is applicable for the following 12-month period. The MAPR shall be reduced by the amount of the countable annual income of the surviving spouse. 38 U.S.C. §§ 1503, 1521; 38 C.F.R. §§ 3.3, 3.23(b). 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 the 12-month annualization period in which received, except for listed exclusions. 38 U.S.C. § 1503 (a); 38 C.F.R. § 3.271 (a). Income from the Social Security Administration (SSA) is not specifically excluded under 38 C.F.R. § 3.272. Such income is therefore included as countable income. For purposes of calculating pension benefits, total income may be reduced by amounts equal to amounts paid by a claimant for unreimbursed medical expenses that were “in excess of 5 percent of the applicable maximum annual pension rate or rates... as in effect during the 12-month annualization period in which the medical expenses 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 surviving spouse received no reimbursement, such as through an insurance company. However, the medical insurance premiums themselves, as well as the Medicare deduction, may be applied to reduce countable income. For the purpose of determining initial entitlement, or resuming payments on an award that was previously discontinued, the monthly rate of pension shall be computed by reducing the applicable maximum pension rate by the countable income on the effective date of entitlement and dividing the remainder by twelve. 38 C.F.R. § 3.273 (a). In essence, VA subtracts the total amount of countable income in one year, less excluded income, from the MAPR for that year; then, if a positive amount remains, the rest is divided by twelve to determine the monthly death pension benefit. When a change in the MAPR occurs, the Board repeats the calculation with the new MAPR as the starting amount. 38 C.F.R. § 3.273 (b)(1). When a change in income occurs, the MAPR will be reduced by the new annualized income effective on the date that the increased income began. 38 C.F.R. § 3.273 (b)(2). The appellant filed a claim for death pension benefits on November 16, 2011. The MAPR for a surviving spouse with no dependents effective December 1, 2011 was $8,219.00. The applicable MAPR was increased to $8,359.00 effective December 1, 2012; to $8,485.00 effective December 1, 2013; to $8,630.00 effective December 1, 2014; and to $8,656.00 from December 1, 2016. In her November 2011 claim, the appellant identified receiving income from Social Security in the amount of $1,032.00 monthly. An SSA inquiry, however, shows that the appellant began receiving $1,168.90 monthly from December 2011. The Board will, therefore, use the updated amount reported by the SSA in calculating the appellant’s income. The Board finds that for the appeal period beginning on November 16, 2011, the appellant had an annual income of $14,026.80. Countable income may be reduced by medical expenses in excess of five percent of the applicable MPAR, which in this case is $411.00. On her November 2011 claim, the appellant identified payment of Medicare premiums in the amount of $1,156.80 annually. While she also identified payment for doctor’s bills, this was stated to have been paid from November 1, 2010 to November 1, 2011, prior to the current appeal period. No additional medical expenses were reported for the appeal period from November 16, 2011. The Board finds that medical expenses in the amount of $745.80 may be subtracted from countable income. Therefore, the appellant had a countable income of $13,281.00. The Board finds that her countable income exceeded applicable MAPR of $8,219.00 and is a bar to the receipt of death pension benefits. (Continued on the next page)   An SSA inquiry shows that the appellant received SSA benefits in the amount of $1,188.90 a month from December 1, 2012. From December 1, 2012, the appellant had an annualized income of $14,266.80. Updated medical expenses were not submitted, but the Board will count the earlier identified Medicare premiums in the amount $1,156.80 annually. Countable income may be reduced by medical expenses in excess of five percent of the applicable MAPR, which was $418.00 from December 1, 2012. Therefore, medical expenses in the amount of $738.80 may be subtracted from countable income. The Board finds that the appellant had a countable income of $13,528.00 from December 1, 2012. Her income continued to exceed the applicable MAPR of $8,359.00 and is a bar to the receipt of death benefits. The record shows that for the entire appeal period, the appellant’s SSA income exceeded applicable maximum annual pension rates, and therefore, payment of death pension benefits is not warranted. K. PARAKKAL Veterans Law Judge Board of Veterans’ Appeals ATTORNEY FOR THE BOARD Christine C. Kung