Citation Nr: 20004228 Decision Date: 01/17/20 Archive Date: 01/16/20 DOCKET NO. 17-66 796 DATE: January 17, 2020 ORDER Accrued benefits are denied. FINDING OF FACT At the time of his death, the Veteran was not due any accrued benefits. CONCLUSION OF LAW The criteria for an award of accrued benefits have not been met. 38 U.S.C. §§ 1503, 1521, 5121; 38 C.F.R. §§ 3.3, 3.23, 3.29, 3.271, 3.272, 3.273, 3.1000. REASONS AND BASES FOR FINDING AND CONCLUSION The Veteran served on active duty in the United States Army from May 1953 to April 1955. He died in December 2016. The appellant is the Veteran’s surviving spouse. The case is on appeal from a July 2017 rating decision. The Board has limited the discussion below to the relevant evidence required to support its finding of fact and conclusion of law, as well as to the specific contentions regarding the case as raised directly by the Veteran and those reasonably raised by the record. See Scott v. McDonald, 789 F.3d 1375, 1381 (Fed. Cir. 2015); Robinson v. Peake, 21 Vet. App. 545, 552 (2008). Legal Criteria Basic entitlement to accrued benefits exists and periodic monetary benefits authorized under VA laws, to which a payee was entitled at his or her death under existing ratings or decisions or those based on evidence in the file at date of death, and due and unpaid will, upon the death of such person, be paid upon the death of a veteran to the living person first listed as follows: (i) His or her spouse; (ii) His or her children (in equal shares); (iii) His or her dependent parents (in equal shares) or the surviving parent; (2) Upon the death of a surviving spouse or remarried surviving spouse, to the veteran’s children; (3) Upon the death of a child, to the surviving children of the veteran entitled to death pension, compensation, or dependency and indemnity compensation; (4) Upon the death of a child claiming benefits under chapter 18 of this title, to the surviving parents; and (5) In all other cases, only so much of the accrued benefit may be paid as may be necessary to reimburse the person who bore the expense of last sickness or burial. 38 U.S.C. § 5121(a); 38 C.F.R. § 3.1000(a). 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. § 1521; 38 C.F.R. § 3.3(a)(3). The MAPR shall be reduced by the amount of the countable annual income of the Veteran. 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), interest and dividends, and spousal pensions are included as countable income as they are not specifically excluded under 38 C.F.R. § 3.272. 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, dividing the remainder by twelve, and then rounding down to the nearest dollar. 38 C.F.R. §§ 3.29, 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, VA 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). Analysis The Veteran was in receipt of a pension. In November 2012, the pension was terminated as of November 1, 2012 because he was no longer eligible due to an income change. The Veteran applied for reinstatement of benefits in March 2014 and submitted a list of medical expenses. In March 2016, the Veteran submitted an eligibility verification report with income for the year 2015. The income report listed monthly SSA income for the Veteran of $1,350.90 and annual interest and dividends of $275 as well as monthly pension income for the appellant of $151.13. The Veteran also submitted medical expenses for the year 2015. In November 2016, the Veteran was awarded pension benefits for the year 2015 in the amount of $4,704. The notification letter stated that, for 2015, the Veteran’s income was $13,450 from the SSA and $275 from another source, the appellant’s income was $1,813, and that the countable income was reduced by $7,235 in unreimbursed medical expenses for a countable income of $12,145. The letter also lists a second incorrect lower figure for unreimbursed medical expenses of $1,258 and an incorrect higher countable income figure of $18,122. However, the Veteran was awarded $392.00 per month for 2015 and disbursed funds in the amount of $4,704. Later in November 2016, the Veteran submitted a statement disagreeing with the pension amount awarded for 2015 based on mathematical errors in the notification letter. Thereafter, in January 2017, the appellant filed a request for reimbursement of the Veteran’s burial expenses. In April 2017, the RO granted the $1,049 in burial benefits and denied entitlement to accrued benefits. Later in April 2017, the appellant submitted a statement showing the Veteran’s funeral expenses were in excess of $12,000. The appellant also submitted a statement disputing the amount awarded for the Veteran’s 2015 pension benefits. In October 2017, the RO sent the appellant a statement of the case (SOC). The RO acknowledged typos in the November 2016 notification letter. However, the RO stated that the correct amount of $4,704 was awarded to the Veteran for his 2015 pension based on the corrected amounts of $16,450 in SSA income, medical expenses of $7,235, and a 5 percent of MAPR reduction of medical expenses of $842. Subsequently, in December 2017, the appellant submitted a VA Form 9 that explained her disagreement with the 2015 pension calculation. She stated that in 2015 the Veteran’s SSA income was $16,450.80 and he had medical expenses of $7,235. She subtracted $842 from the medical expense amount to get $6,393 and then subtracted that figure from the SSA income amount to get $10,057. Based on this calculation, the appellant stated that the 2015 pension income should have been $10,057 rather than $4,704. Despite errors in the November 2016 notification letter, the Board finds that the amount disbursed to the Veteran for his 2015 pension was correctly calculated as $4,704 by the RO. The MAPR for 2015 for a Veteran with one dependent was $16,851.00, with medical expenses in excess of $842 deductible from income. See Survivors Pension Rate Tables-Effective 12/1/14, https://www.benefits.va.gov/PENSION/rates_veteran_pen14.asp. Using the Veteran’s March 2016 income statement totals, the 2015 household income total is calculated as $16,450 (Veteran’s SSA income annualized) plus $275 (Veteran’s interest and dividends income) plus $1,813 (appellant’s pension annualized) for a 2015 total income of $18,538. The appellant does not dispute the 2015 medical expense amount of $7,235 or that $842 (5 percent of the MAPR) is subtracted for a total medical expense deduction of $6,393. The 2015 income total of $18,538 minus the total expense deduction of $6,393 leaves a final countable income total of $12,145. Therefore, the Veteran’s 2015 pension award is calculated as the 2015 MAPR of $16,851 minus $12,145 countable income for a total of $4,706. $4,706 is then divided by twelve and rounded down to the nearest dollar to calculate a 2015 monthly pension rate for the Veteran of $392. As noted above, in November 2016, the Veteran was disbursed $4,704, or 12 months of the calculated monthly pension rate for 2015. Although the Board is sympathetic to the appellant’s loss of her husband and recognizes his honorable service in the United States Army, it is bound by the law as passed by Congress. As set forth above, accrued benefits are not warranted here, as the Veteran was not due any accrued benefits at his death. The law pertaining to the appellant’s entitlement to accrued benefits is clear and her claim must be denied as a matter of law. Sabonis v. Brown, 6 Vet. App. 426, 430 (1994). JEREMY J. OLSEN Acting Veterans Law Judge Board of Veterans’ Appeals Attorney for the Board D. Jimerfield The Board’s decision in this case is binding only with respect to the instant matter decided. This decision is not precedential, and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.