Citation Nr: 21030629 Decision Date: 05/19/21 Archive Date: 05/19/21 DOCKET NO. 17-36 347 DATE: May 19, 2021 ORDER Revision of the July 2015 rating decision assigning a 50 percent disability rating for a left knee meniscal tear with anterior cruciate ligament (ACL) tear, degenerative joint disease, and a Baker's Cyst (hereinafter, a left knee disability) based on clear and unmistakable error (CUE) was warranted. Revision of the July 2015 rating decision assigning a 50 percent disability rating for a right knee meniscal tear with ACL tear, degenerative joint disease, and loose bodies (hereinafter, a right knee disability) based on CUE was warranted. The reduction of the disability rating for the left knee disability to 10 percent from August 1, 2016, was improper. The reduction of the disability rating for the right knee disability to 10 percent from August 1, 2016, was improper. FINDINGS OF FACT 1. Although the correct facts, as they were known at the time, were before the adjudicator in July 2015, the statutory or regulatory provisions then extant were not correctly applied, and the failure to correctly apply those laws and regulations manifestly changed the outcome of the July 2015 rating decision that assigned 50 percent disability ratings for the Veteran's right and left knee disabilities. 2. At the time of the May 2016 rating decision, improvement of the Veteran's right and left knee disabilities under the ordinary conditions of life and work had not been demonstrated. CONCLUSIONS OF LAW 1. The criteria for revision or reversal of the July 2015 rating decision assigning a 50 percent disability rating for the left knee disability from January 8, 2015, based on CUE have been met. 38 U.S.C. § 5109A; 38 C.F.R. §§ 3.105, 3.2600, 4.71a, Diagnostic Code 5010, 5261. 2. The criteria for revision or reversal of the July 2015 rating decision assigning a 50 percent disability rating for the right knee disability from January 8, 2015, based on CUE have been met. 38 U.S.C. § 5109A; 38 C.F.R. §§ 3.105, 3.2600, 4.71a, Diagnostic Code 5010, 5261. 3. The rating reduction for the left knee disability from 20 percent to 10 percent from August 1, 2016, was not proper. 38 U.S.C. §§ 1155, 5107, 5109A, 5112; 38 C.F.R. § 3.105, 4.71a, Diagnostic Codes 5010, 5260, 5261. 4. The rating reduction for the right knee disability from 20 percent to 10 percent from August 1, 2016, was not proper. 38 U.S.C. §§ 1155, 5107, 5109A, 5112; 38 C.F.R. § 3.105, 4.71a, Diagnostic Codes 5010, 5260, 5261. REASONS AND BASES FOR FINDINGS AND CONCLUSIONS The Veteran served on active duty in the United States Marine Corps from March 1973 to March 1977. This matter comes before the Board of Veterans' Appeals (Board) on appeal from a March 2016 rating decision finding that there was CUE in a July 2015 rating decision that assigned 50 percent ratings for right and left knee disabilities and finalizing proposed reductions to 10 percent for both knee disabilities, effective from August 1, 2016. In January 2021, the Veteran testified before the undersigned at a hearing via videoconference. A transcript of his testimony has been associated with the claims file. At the outset, the Board notes that the issue certified to the Board was whether revision or reversal of the July 2015 rating decision assigning 50 percent ratings for the right and left knees was warranted due to CUE. In the May 2016 rating decision on appeal, however, the RO not only found that there was CUE in the July 2015 rating decision, but also implemented a rating reduction to 10 percent from August 1, 2016, for each knee disability. As such, the Board has recharacterized the issues on appeal as (1) whether revision or reversal of the July 2015 rating decision that assigned a 50 percent rating for each knee was warranted due to CUE, and (2) whether the rating reduction to 10 percent from August 1, 2016, in each knee was proper. The Board also notes that, although the Veteran filed a January 2015 claim for increased ratings for his bilateral knee disabilities, the issue of whether increased ratings are warranted is not properly before the Board at this juncture. The issue of entitlement to restoration of a reduced rating is distinct from the issue of entitlement to an increased rating for the same disability. See, e.g., Peyton v. Derwinski, 1 Vet. App. 282, 286 (1991). In this case, the RO did not adjudicate whether an increased rating was warranted in the May 2016 rating decision on appeal. Accordingly, the Board will refer the issue of whether increased ratings are warranted for his right and left knee disabilities to the RO for adjudication in the first instance. CLEAR AND UNMISTAKABLE ERROR By way of background, the Veteran filed a claim for increased disability ratings for his bilateral knee disabilities in January 2015. At the time, his right and left knee disabilities were rated at 20 percent disabling under diagnostic code 5010-5260. Additionally, he had been assigned separate ratings in both knees for knee instability. The Veteran underwent a VA examination to determine the current severity of his knee disabilities before a July 2015 rating decision was issued. In that rating decision, the RO increased his disability ratings to 50 percent in each knee from January 8, 2015. More specifically, the RO increased the rating in the right knee to 50 percent pursuant to diagnostic code 5261 for limitation of extension, while the RO increased the rating in the left knee to 50 percent for limitation of extension under diagnostic code 5010-5261. The ratings for right and left knee instability that were previously in effect were continued. Subsequently, in January 2016, the RO issued a proposed rating decision that stated that the RO's July 2015 rating decision contained CUE to the extent that it assigned 50 percent ratings for the right and left knee disabilities because extension had been normal on his last VA examination. Additionally, the RO proposed to reduce his ratings from 50 percent for limitation of extension to 10 percent for limitation of flexion and painful motion, based on the VA examination findings. The Veteran was notified of the proposed rating decision in a January 2016 notification letter. Subsequently, in a May 2016 rating decision, the RO issued a rating decision finding that there was CUE in the July 2015 rating decision to the extent it assigned the 50 percent ratings for the bilateral knee disabilities. In the May 2016 rating decision, the RO also reduced his disability evaluation in each knee from 50 percent to 10 percent, effective August 1, 2016. Notably, the 10 percent ratings were assigned under diagnostic code 5010-5261, for limitation of extension and painful motion, in the left knee, and diagnostic code 5261, for limitation of extension, in the right knee. (The ratings for right and left knee instability were not discussed by the May 2016 rating decision.) In May 2016, the Veteran filed a notice of disagreement in response to the May 2016 rating decision. This appeal followed. By operation of law, a previous rating decision by an agency of original jurisdiction is binding and will be accepted as correct in the absence of CUE. 38 C.F.R. §§ 3.104(a), 3.105(a). Generally, the issue of CUE arises when claimants allege that there is a clear and unmistakable error in a prior, final rating decision. However, an RO can also seek to reverse or revise a prior rating decision on the grounds of CUE. 38 C.F.R. § 3.2600(e). CUE is a very specific and rare kind of "error." It is the kind of error, of fact or of law, that when called to the attention of later reviewers compels the conclusion, to which reasonable minds could not differ, that the result would have been manifestly different but for the error. Fugo v. Brown, 6 Vet. App. 40, 43-44 (1993). The error must be of a type that is outcome-determinative, and subsequently developed evidence may not be considered in determining whether an error existed in the prior decision. See Porter v. Brown, 5 Vet. App. 233, 235-36 (1993). Where evidence establishes CUE, the prior decision will be reversed or amended. 38 C.F.R. § 3.105(a). For the purpose of authorizing benefits, the rating or other adjudicatory decision which constitutes a reversal of a prior decision on the grounds of CUE has the same effect as if the corrected decision had been made on the date of the reversed decision. Id. CUE is established when the following conditions are met: (1) either (a) the correct facts in the record were not before the adjudicator, or (b) the statutory or regulatory provisions in existence at the time were incorrectly applied; (2) the alleged error must be "undebatable," not merely "a disagreement as to how the facts were weighed or evaluated"; and (3) the commission of the alleged error must have "manifestly changed the outcome" of the decision being attacked on the basis of CUE at the time that decision was rendered. Evans v. McDonald, 27 Vet. App. 180, 185 (2014), aff'd, 642 F. App'x 982 (Fed. Cir. 2016). The Board must determine whether the July 2015 rating decision that assigned 50 percent ratings for the right and left knee disabilities under diagnostic code 5261 and 5010-5261, respectively, from January 8, 2015, was clearly and unmistakably erroneous. The impact of finding that the July 2015 rating decision contained CUE would be to revise the July 2015 rating decision that assigned 50 percent disability ratings and treat it as if it had not assigned 50 percent ratings in the first place. First, the Board will review the relevant evidence before the RO at the time of the July 2015 rating decision. This includes the Veteran's fully developed claim, received on January 8, 2015, as well as an April 2015 disability benefits questionnaire completed at a VA examination and VA treatment records. In his January 2015 claim, the Veteran indicated that he was seeking increased ratings for his bilateral knee disabilities. His claim indicated that he had degenerative arthritis with internal derangement in the right and left knees, as well as difficulty standing and knee pain. He indicated that he had been receiving monthly chiropractic care at the Sepulveda VA Medical Center in California in 2013 and 2014. In April 2015, the Veteran was afforded a VA examination with respect to his knees. At the VA examination, he described a history of degenerative joint disease in the left knee with a Baker's cyst associated with degenerative arthritis with internal derangement, as well as degenerative arthritis with internal derangement in the right knee. He reported chronic pain in both knees, which was rated at 5-6/10 and was treated by a chiropractor, who adjusted his legs to relieve the pain in his knees. He stated that several doctors had recommended knee replacement but that he was reluctant to have the surgery. Additionally, he described flare-ups that occurred approximately twice a week that he characterized as dull pain relieved with pain medication. He reported that his ability to squat, kneel, or walk longer than one block was impaired. On initial range of motion evaluations, flexion in the right knee was from 0 to 75 degrees and extension was from 75 to 0 degrees, while flexion in the left knee was from 0 to 80 degrees and extension was from 80 to 0 degrees. There was evidence of pain on flexion, as well as pain on weight-bearing in both knees. The examiner opined that pain, lack of endurance, and incoordination significantly limited functional ability with repeated use over a period of time and with flare-ups. In terms of degrees, he estimated that right knee flexion would be limited to 0 to 70 degrees and right knee extension from 70 to 0 degrees, while left knee flexion would be limited to 0 to 75 degrees and left knee extension from 75 to 0 degrees. No ankylosis was noted on examination. The Veteran reported that he used a brace and cane regularly. In the portion of the examination report on functional impact, the examiner indicated that the Veteran's bilateral knee condition impacted his ability to walk longer than one walk without increasing pain and that he avoided going up and down stairs or inclines or walking on uneven surfaces due to increased pain. VA treatment records generated prior to the date of the July 2015 rating decision are consistent with the Veteran's reports that he saw a chiropractor at the VA Medical Center in Sepulveda to adjust his legs and relieve knee pain. They also indicate that the Veteran's gait had been altered by the arthritis in his knees and that his chronic pain prevented walking longer than a couple of blocks. The VA treatment records also reflected that he was taking Tramadol as needed for knee pain. However, the VA treatment records do not describe the limitation of motion in the knees in terms of degrees. Having reviewed the relevant evidence then before the RO in July 2015, the Board will review the relevant governing law and regulations. Prior to the July 2015 rating decision, the Veteran had been assigned a 20 percent disability rating for the left knee disability under diagnostic code 5010-5260 from March 24, 2006 (not including a temporary 100 percent disability rating from July 15, 2008, to September 31, 2008, under 38 C.F.R. § 4.30). Additionally, he had been assigned a 20 percent disability rating for the right knee disability under diagnostic code 5010-5260 from February 10, 2000. With regard to degenerative or traumatic arthritis, the then-extant rating schedule provided that such conditions would be rated on the basis of limitation of motion under the appropriate diagnostic codes for the specific joints involved. See 38 C.F.R. § 4.71a, Diagnostic Codes 5003, 5010 (2015). Here, those codes were those for limitation of flexion and limitation of extension of the knee under diagnostic codes 5260 and 5261, respectively. When the limitation of motion of the specific joint involved was noncompensable under those codes, a 10 percent rating would be assigned for each major joint (including the knee) affected by limitation of motion. See id. Here, the record shows that Veteran had previously been diagnosed with arthritis in both knees by x-ray. Then, as now, diagnostic code 5260, for limitation of flexion of the leg, provided that a noncompensable rating was warranted when flexion was limited to 60 degrees, while a 10 percent rating was warranted for limitation of flexion to 45 degrees, a 20 percent rating for limitation of flexion not 30 degrees, and a 30 percent rating for limitation of flexion to 15 degrees. 38 C.F.R. § 4.71a (2015), Diagnostic Code 5260. At the time of the July 2015 rating decision, as now, diagnostic code 5261, for limitation of extension of the leg, provided for a noncompensable rating when extension was limited to 5 degrees, a 10 percent rating when extension was limited to 10 degrees, a 20 percent rating when extension was limited to 15 degrees, a 30 percent rating when extension was limited to 20 degrees, a 40 percent rating when extension was limited to 30 degrees, and a 50 percent rating when extension was limited to 45 degrees. 38 C.F.R. § 4.71a (2015), Diagnostic Code 5261. In 2015, as now, when VA evaluated joint disabilities, it had to consider granting a higher rating in cases in which functional loss due to pain, weakness, excess fatigability, or incoordination was demonstrated, and those factors were not contemplated in the relevant rating criteria. See 38 C.F.R. §§ 4.40, 4.45, 4.59 (2015); DeLuca v. Brown, 8 Vet. App. 202 (1995). The United States Court of Appeals for Veterans Claims (Court) clarified that although pain may be a cause or manifestation of functional loss, limitation of motion due to pain is not necessarily rated at the same level as functional loss where motion is impeded. See Mitchell v. Shinseki, 25 Vet. App. 32 (2011); cf. Powell v. West, 13 Vet. App. 31, 34 (1999); Hicks v. Brown, 8 Vet. App. 417, 421 (1995). Instead, the Mitchell Court explained that pursuant to 38 C.F.R. §§ 4.40 and 4.45, the possible manifestations of functional loss include decreased or abnormal excursion, strength, speed, coordination, or endurance, as well as less or more movement than is normal, weakened movement, excess fatigability, and pain on movement (as well as swelling, deformity, and atrophy) that affects stability, standing, and weight-bearing. See 38 C.F.R. §§ 4.40, 4.45 (2015). Thus, functional loss caused by pain had to be rated at the same level as if the functional loss were caused by any of the other factors cited above (collectively, "DeLuca factors"). In sum, the governing laws and regulations required for VA to determine the overall functional impairment due to these factors when evaluating the severity of a joint disability. Here, the evidence before the adjudicator at the time of the July 2015 rating decision indicated that although the Veteran's flexion was limited to 70 and 75 degrees during flare-ups and with repeated use over time in the right and left knees, respectively, extension was nevertheless to 0 degrees in each knee, even when considering the DeLuca factors. Despite this evidence, the RO assigned 50 percent ratings based on limitation of extension of the legs. As such, it appears that the RO failed to correctly apply the rating criteria in 38 C.F.R. § 4.71a in its July 2015 rating decision. Indeed, the April 2015 VA examination report clearly indicated that the Veteran's extension was to 0 degrees in both knees, even when accounting for pain, lack of endurance, and incoordination with repeated use over time or flare-ups. Although the evidence before the RO suggested that the Veteran had difficulty squatting, kneeling, or walking certain distances due to the pain in his knees, no other evidence before the RO, including his VA treatment records, suggested that the Veteran's extension was limited to 45 degrees in either knee. To that end, although the Veteran's bilateral knee flexion was limited, reasonable minds would agree that flexion was not limited to 45 degrees, even when accounting for the DeLuca factors. In other words, this error was undebatable, and of the sort which, if it had not been made, would have manifestly changed the outcome at the time it was made. Indeed, had the RO not misapplied the rating criteria, a 50 percent rating would not have been assigned under diagnostic code 5010-5261 or 5261 in either knee from January 8, 2015. As such, the July 2015 rating decision must be revised so that the 50 percent ratings were never assigned. REDUCTIONS The Board notes that although the RO was correct in finding that CUE existed in the July 2015 rating decision that assigned 50 percent disability ratings from January 8, 2015, the RO did not properly implement its own finding of CUE. This is evident because the RO kept the 50 percent rating assigned in the July 2015 rating decision in place until August 1, 2016. Stated differently, the RO correctly found that revision of the July 2015 rating decision was warranted but failed to act as if it had reversed or revised the July 2015 rating decision. Indeed, if it had actually implemented its finding of CUE in the July 2015 rating decision, the RO would have corrected the decision. The impact of doing so would have been to restore the previous disability ratings that were in effect (i.e., the 20 percent ratings that had been in effect for over five years in each knee under diagnostic code 5010-5260) as if the 50 percent rating had never been assigned in the first place. Indeed, under Pirkl v. Shinseki, 718 F.3d 1379 (Fed. Cir. 2013) (Pirkl I), the implementation of a CUE finding in an earlier rating decision requires renewed consideration of subsequent rating decisions to determine the extent to which the CUE finding changes the legal or factual basis of the later evaluations. In Pirkl v. Shinseki, 906 F.3d 1371 (Fed. Cir. 2018) (Pirkl II), the Court of Appeals for the Federal Circuit explained this reconsideration should be conducted as if the corrected decision was implemented at the time of the original decision. As such, for purposes of determining whether the rating reduction effectuated in the May 2016 rating decision was proper, the Board must proceed as if the RO had never assigned a 50 percent rating from January 8, 2015, and instead must address whether it was proper to reduce his disability ratings from 20 percent under diagnostic code 5010-5260 to 10 percent under diagnostic codes 5010-5261 and 5261 from August 1, 2016. Pursuant to 38 C.F.R. § 3.105(e), where a reduction in evaluation of a service-connected disability is considered warranted and the lower evaluation would result in a reduction or discontinuance in compensation payments currently being made, a rating proposing the reduction will be prepared. The beneficiary will be notified of the proposed reduction and furnished reasons therefor and given 60 days for the presentation of additional evidence. Id. If no additional evidence is received during that period, the reduction will be made effective the last day of the month in the which a 60-day period from the date of the notice to the payee expires. Id. Here, the procedural requirements of 38 C.F.R. § 3.105(e) were met. To that end, the Veteran was informed of the proposal to reduce his rating for both knee disabilities in a January 2016 notification letter, to which a January 2016 proposed rating decision was attached. In the notification letter, the RO informed him that he had 60 days to present additional evidence and 30 days to request a pre-determination hearing. The May 2016 rating decision that reduced the ratings for limitation of motion in each knee to 10 percent, effective August 1, 2016, was issued more than 60 days after he was notified of the proposed rating reduction. As such, the procedural requirements of 38 C.F.R. § 3.105(e) were satisfied. The chief question for the Board is thus whether the rating reduction was proper. Congress has provided that a veteran's disability will not be reduced unless an improvement in the disability is shown to have occurred. 38 U.S.C. § 1155. Specific requirements must be met in order for VA to reduce certain ratings assigned for service-connected disabilities. See 38 C.F.R. § 3.344. To that end, although material improvement in a physical condition is clearly reflected in an examination, the rating agency must consider whether the evidence makes it reasonably certain that the improvement will be maintained under the ordinary conditions of life. 38 C.F.R. § 3.344(a). In cases where doubt remains, after according due consideration to all evidence developed under paragraph (a), the rating agency will continue the rating in effect. 38 C.F.R. § 3.344(b). In Brown v. Brown, 5 Vet. App. 413, 421 (1993), the Court held that the provisions of 38 C.F.R. § 3.344(a) and (b) applied to all rating reductions, even if the rating had not been in effect for five years at the time. The Court also held that the veteran need not demonstrate the retention of the higher evaluation is warranted; rather, VA must show by a preponderance of the evidence that the reduction was warranted. See id. at 418. In sum, a rating reduction is not proper unless a veteran's disability shows actual improvement in his or her ability to function under the ordinary conditions of life and work. See Faust v. West, 13 Vet. App. 342, 349 (2000). In considering the propriety of a reduction, the Board must focus on the evidence available to the RO at the time the reduction was effectuated, although post-reduction medical evidence may be considered in the context of determining whether actual improvement was demonstrated. Dofflemeyer v. Derwinski, 2 Vet. App. 277, 281-82 (1992). After careful consideration of the evidence of record, the Board concludes that the RO's decision to reduce the Veteran's rating to 10 percent from August 1, 2016, was improper. As such, restoration of the 20 percent evaluations previously in effect from August 1, 2016, is warranted. In this regard, the Board notes that the RO appears to have largely based its decision to reduce his disability ratings to 10 percent in each knee on the results of the Veteran's April 2015 VA examination, an examination that the RO itself found problems with (indicating that it did not provide the basis for the 50% rating). To that end, although the April 2015 VA examination described findings based on active range of motion testing and in weight-bearing, the examiner did not test for pain on passive motion or in non-weight-bearing. As such, the examination does not comport with the holding in Correia v. McDonald, 28 Vet. App. 158 (2016), which requires testing for pain on both active and passive motion and in weight-bearing and non-weight-bearing, consistent with 38 C.F.R. § 4.59. Moreover, it was unclear whether the Veteran had taken Tramadol or other pain-relieving medication on the day of his April 2015 VA examination. In this respect, the examiner also failed to estimate the Veteran's functional ability in the absence of medication. See Jones v. Shinseki, 26 Vet. App. 56, 64 (2012). Accordingly, the April 2015 VA examination was inadequate for rating purposes, providing no basis for the increase or the decrease rating. When a reduction of disability is based on an inadequate examination, the reduction is void ab initio. See Greyzck v. West, 12 Vet. App. 288, 292 (1999). Even assuming arguendo that the April 2015 VA examination were in fact adequate, the reduction still would not have been proper. To reiterate, a rating reduction is warranted when a veteran's disability shows actual improvement in his or her ability to function under the ordinary conditions of life and work, as opposed to when they demonstrate that they should retain a higher evaluation. Here, even if the results of the April 2015 VA examination sufficiently demonstrated that the Veteran's knee disabilities fell within the criteria for a 10 percent rating, that fact alone would not justify the reduction. As set forth above, the Veteran informed the VA examiner that his ability to squat, kneel, or walk more than a few blocks was impaired due to knee pain. He had limited flexion of both knees, which was exacerbated during flare-ups and with repeated use over time. This is consistent with the Veteran's VA treatment records, which reflect that he took Tramadol as needed for knee pain. Indeed, subsequent evidence, such as the Veteran's January 2021 hearing testimony, suggests that his knee disabilities have worsened over time and that he still requires surgery. Essentially, the evidence is not sufficient to support a finding that this disability had actually improved as of August 1, 2016, resulting in an improvement in his ability to function under the ordinary conditions of life and work. As noted above, it clearly did not provide a basis for a higher rating, but also did not provide a clear basis for a lower rating as well. In sum, the RO reduced the Veteran's rating based on medical information that did not clearly show that any improvement observed at the time would result in the improvement in his ability to function under ordinary conditions. The burden is on VA to show that a rating reduction is warranted, and, as set forth above, VA has failed to meet this burden. As such, the 20 percent ratings for the right and left knee disabilities under diagnostic code 5010-5260 must be restored from August 1, 2016. See Dofflemeyer, 2 Vet. App. at 277 (holding that where VA has reduced a veteran's disability rating without observing the applicable law and regulations, such a rating is void ab initio and restoration is required). (Continued on the next page) The Board apologies to the Veteran regarding the perplexity in this case. J. Crowley Veterans Law Judge Board of Veterans' Appeals Attorney for the Board E. Rademacher, Associate 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.