Citation Nr: 21066229 Decision Date: 10/29/21 Archive Date: 10/29/21 DOCKET NO. 16-33 558 DATE: October 29, 2021 ORDER The debt in the amount of $3,578 based on an adjustment of Department of Veterans Affairs (VA) compensation benefits paid on August 1, 2013 and September 1, 2013 was properly created; the appeal is denied. FINDINGS OF FACT 1. The Veteran was paid both retirement pay as well as VA compensation benefits on August 1, 2013 and September 1, 2013. The total amount paid was $3,578 ($1,789 per payment). 2. The Veteran was also paid via the Concurrent Retirement and Disability Payment (CRDP) a retroactive payment that included the same August 1, 2013 and September 1, 2013 time periods, so $3,578 was properly recouped out of the total payment out of $6,069. CONCLUSION OF LAW The debt in the amount of $3,578 was properly created. 38 U.S.C. §§ 5304, 5305' . 38 C.F.R. § 3.750. REASONS AND BASES FOR FINDINGS AND CONCLUSION The Veteran served on active duty from July 1978, to April 1981 and from November 1998, to June 2013. The Veteran's DD Form 214 for the second period of service reflects that she retired with permanent disability. The service records reflect that the Veteran had service in the Army National Guard between the two periods of service. Following retirement, a July 2013 rating decision granted service connection for multiple disabilities at a combined disability rating of 90 percent effective from June 29, 2003, with the date of payment commencing effective from July 1, 2013. In general, there is a prohibition on the concurrent payment of military retired pay and VA disability compensation pay without a waiver of a portion of the retired pay. 38 U.S.C. §§ 5304, 5305. However, a Veteran who is entitled to military retired pay and disability compensation for a service-connected disability rated 50 percent or more, or a combination of service-connected disabilities rated 50 percent or more, under the schedule for rating disabilities is entitled to receive both payments per other considerations of this regulation. 38 C.F.R. § 3.750 (b)(1). Retirees with more than 20 years of service are generally eligible for consideration of concurrent pay, but retirees with less than 20 years of service are not eligible for concurrent payment. 38 C.F.R. § 3.750 (b) (2) and (3). The veterans who are entitled to receive some measure of concurrent payments for both their retired military pay and their VA disability compensations are provided such payment under two applicable programs are known as Combat Related Special Compensation (CRSC) and CRDP. CRDP is a program that is available to some Chapter 61 disability retirees restores some or all of the military retired pay that was deducted due to receipt of VA service-connected disability compensation. Retirees must be rated 50 percent or more disabled by VA and have served a minimum of 20 years creditable service, including service in the National Guard and Reserves. Unlike CRSC, the disabilities do not have to be combat-related. 38 U.S.C. §§ 1414, 5304, 5305; 38 C.F.R. § 3.750. Retirees are not required to apply for this benefit; enrollment is automatic. The CDRP also applies to individuals who retired with less than 20 years of creditable service, under the Temporary Early Retirement Authority (TERA), who are rated 50 percent or more disabled by VA. See https://www.dfas.mil/retiredmilitary/disability/crdp.html and 38 C.F.R. § 3.750. In a July 2013 letter, the Veteran was notified of her award of service-connected disability benefits. She was advised that she was not allowed to receive full military retired pay and full VA compensation at the same time. She was told that if her VA compensation is less than her retired pay, she would receive compensation payments. The military service department would pay her the difference between her compensation and her retired pay. Alternatively, if her VA compensation is greater than her retired pay, VA would pay her compensation, and she would not receive retired pay. For now, she was informed that VA must withhold all of her compensation until August 1, 2013 in order to prevent a double payment. She was told that her DD Form 214 indicated she may be entitled to military retired pay, so VA had withheld her retroactive compensation benefits in order to avoid a possible overpayment of benefits. At that time, Defense Finance and Accounting Services (DFAS) did not have her retirement account established, therefore VA was unable to obtain the gross amount of retired pay she was entitled to receive. Once her gross retired pay amount was received and verified, VA would review her award and determine if any adjustments were necessary. She was told that she may be eligible for full or partial concurrent receipt of VA compensation and military retired pay under the CRSC and/or CRDP programs. Her retired pay center (RPC) had been notified of the award of VA compensation. If her RPC determined the withholdings from her VA compensation should be retroactively adjusted due to CRSC/CRDP eligibility; VA would be notified and would adjust her VA compensation accordingly. The Board notes that eligibility for those programs is not a VA determination. In sum, the Veteran's VA compensation benefits awarded pursuant to the July 2013 rating decision was paid at the rate of $1,789 a month effective from July 1, 2013. This amount was lower than her monthly military retirement benefit. VA expected that the Veteran's retired pay needed to offset her VA compensation would be withheld on August 1, 2013. So, VA withheld the Veteran's full VA compensation of $1,789 for July 1, 2013 and began paying her full VA compensation of $1,789 effective August 1, 2013. However, VA then received information from the DFAS indicating that they did not offset the Veteran's VA compensation on August 1, 2013; rather, the DFAS did not begin withholding benefits to offset her compensation until October 1, 2013. As such, the Veteran was informed by letter dated September 20, 2013 that VA proposed to recoup the $1,789 paid on August 1, 2013 and September 1, 2013 because DFAS did not make the adjustment for her VA compensation until October 1, 2013. The September 2013 letter informed the Veteran that her benefit would not be reduced for 60 days to allow time for her to show the reduction was not warranted. Since the Veteran did not respond to this letter, on November 25, 2013, VA notified the Veteran that her VA compensation award had been adjusted to reflect receipt of her military retired pay from July 1, 2013 to October 1, 2013. The Veteran's VA compensation was already withheld on July 1, 2013. Therefore, this action created an overpayment of $3,578 for the $1,789 of VA compensation that was paid on both August 1, 2013 and on September 1, 2013 ($1,789 plus $1,789 equals the amount of $3,578). A December 7, 2013, letter from the VA Debt Management Center DMC notified the Veteran of the overpayment of $3,578 and of her right to dispute the validity of this debt and request a waiver thereof. This letter indicated that the debt would be recouped by way of withholding VA benefits that were to begin in March 2014. Thereafter, the Veteran was notified by letter dated February 5, 2014 that she was entitled to a retroactive payment of CRDP in the amount of $6,069 for the period from July 1, 2013, through November 30, 2013. This period included the August through September 2013 timeframe where the Veteran was paid both VA compensation and retirement pay, causing the overpayment. It is apparent that the DFAS calculated the Veteran's cumulative service time as 20 years or more such that she was eligible for CDRP payment. In April 2017, the Veteran indicated that the provisions of 38 C.F.R. § 3.750 with respect to her award of retroactive CRDP compensation had not been applied to her debt. She also argued in earlier July 2016 correspondence and in the April 2017 statement that the matter of her indebtedness had been resolved by way of the retroactive award of CRDP compensation. In January 2019, the Board remanded this case to the AOJ for additional development to determine whether the debt in question was, in effect, resolved by way of the award of $6,069 in CRDP compensation benefits for the period from July 1, 2013, through November 30, 2013; and whether there would be a balance due to the Veteran if the recoupment of the debt in question based on her award of VA benefits in August and September 2013 VA payment exceeded the pro-rated share of the CRDP payment for August and September 2013. On remand, an audit was conducted and additional VA documentation was obtained which showed that a portion ($3,578) of the Veteran's retroactive payment for the CRDP payment was recouped to eliminate the $3,578 overpayment. The Veteran was retroactively paid $6,069. Specifically, $6069 less $3578 equals $2491, which is what the Veteran was paid. The $3,578 was recouped because although the Veteran was entitled to receive both the retirement pay and the VA benefits for the two months in question, the Veteran had been paid the retirement pay and had also been paid the VA compensation. The CDRP payment then was paying again for those two months, so the $3,578 was recouped. Therefore, the debt was properly created, but has been recouped, so the Veteran does not owe any further monies. S. L. Kennedy Veterans Law Judge Board of Veterans' Appeals Attorney for the Board J. Connolly, Counsel 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.