Citation Nr: 22012243 Decision Date: 03/03/22 Archive Date: 03/03/22 DOCKET NO. 17-45 678 DATE: March 3, 2022 REMANDED Entitlement to accrued benefits in excess of $1,562 is remanded. REASONS FOR REMAND The Veteran served on active duty from May 1951 to December 1952 and died in December 2008. The appellant is the daughter of the Veteran's surviving spouse, who died in August 2015. This case comes to the Board of Veterans' Appeals (Board) on appeal from a July 2016 administrative determination of a Department of Veterans Affairs (VA) Regional Office (RO), which granted the appellant accrued benefits in the amount of $1,562 to reimburse her for the amount of funeral/burial expenses she bore upon the death of the surviving spouse. The appellant appealed for a greater sum of accrued benefits. In October 2021, the appellant testified at a videoconference hearing before the undersigned. At the hearing, a discussion ensued regarding whether the matter before the Board was essentially an accrued benefits issue or whether it may encompass an appeal for benefits under a VA caregiver program. Notably, under 38 U.S.C. § 1720G and 38 C.F.R. § 71.40, the law provides a program of assistance for family caregivers, but it is a VA program of assistance and support services for caregivers of "eligible veterans." Thus, it is not applicable in the appellant's case because there are no specific provisions relating to assistance for caregivers of surviving spouses of veterans. Entitlement to accrued benefits in excess of $1,562 The appellant claims that she is entitled to additional accrued benefits beyond the $1,562 that were awarded to her. Essentially, she asserts that she should be reimbursed for the expenses she bore for the last illness of the surviving spouse. Factual Background The Veteran's surviving spouse filed a claim for death pension benefits in May 2014, claiming benefits at the (higher) aid and attendance rate. In her application, she indicated that her sole source of income was Social Security Administration (SSA) benefits and that her medical expenses consisted of Medicare (Parts B and D), supplemental health insurance, assisted living facility fees, and in-home health care services. Specifically, and with additional supporting documentation, monthly SSA benefits were shown to be $1,459, and monthly expenses were reported to consist of $152.30 (Medicare), $222.25 (supplemental health insurance), $4,966 (assisted living facility fee), and $1,200 (total amount covering two individuals who furnished in-home health care). She indicated that a long-term care insurance policy (from Genworth), which paid her $5,026.50 monthly, covered her fee at the assisted living facility. An August 2014 rating decision granted the surviving spouse death pension benefits and awarded her the higher rate of pension that included an additional allowance for aid and attendance. The VA also determined (per her request and a medical evidence of record) that she was not competent to handle the disbursement of VA funds. The award was effective June 12, 2014. After further development (including witness statements), the VA in a March 2015 VA letter informed the surviving spouse of her pension award, consisting of monthly payments of $1,130 effective from the payment date of July 1, 2014 through November 2014, and of $1,149 effective December 1, 2014 (due to a cost-of-living adjustment). She was informed that the VA was withholding back pay from July 2014 through February 2015, pending the appointment of a VA fiduciary to handle her VA affairs. Also, in March 2015, a form for requesting the appointment of a fiduciary was completed, naming the appellant as the fiduciary; on the form, it was noted that the total amount of benefits to which the surviving spouse was entitled but unpaid to date amounted to $9,097. Then, based on notification of the surviving spouse's death in August 2015, the VA indicated in a September 2015 letter (to the estate of the surviving spouse) that pension benefits were suspended, effective September 1, 2015. In December 2015, the VA received the appellant's application for the accrued amounts due a deceased beneficiary, whereon she stated that at the time of her mother's death she had been awaiting a retroactive award of pension pending the completion of the process to appoint a fiduciary. The appellant indicated that she had paid the surviving spouse's medical/last illness and burial expenses prior to and after her mother's death. She furnished documentation that she paid burial expenses of $1,562 and in-home health care expenses totaling $9,693 for the period of June 29, 2014 to March 2, 2015. (She indicated the surviving spouse also left other debts of a medical nature totaling $1,144.84.) In a July 2016 letter to the appellant, the VA awarded her accrued benefits of $1,562, as reimbursement for funeral related costs, and informed her that otherwise the expenses she paid in 2014 and 2015 could not be considered "last expenses" when determining the amount of accrued benefits that were due to her. In statements received in August 2015, June 2017, and September 2017, the appellant indicated that the 2014-15 expenses she bore were directly related to her mother's death because she had suffered a progressive, prolonged illness and required the daily attendance of another person. She stated that she paid the cost of such extra care because it was necessary and beyond her mother's financial means. At an October 2021 Board hearing, the appellant testified about the nature and amounts of expenditures she made on behalf of her mother's care from the time of the filing of the pension application until her death. She indicated that for the 8-month period before pension payments were made beginning in March 2015, she had about $10,000 in out-of-pocket expenses. On the same day as the hearing, the appellant's representative submitted a request for an audit of the surviving spouse's account. The VA in October 2021 sent the appellant the requested audit, which shows the following: from July 1, 2014 through July 2015, the surviving spouse was due a total of $14,842 in death pension benefits; she was paid a total of $5,745 for the period from March 1, 2015 through July 31, 2015; an amount of $9,097 was withheld; and $1,562 was an accrued amount that was paid out in July 2016. Remand Considerations The law provides for payment of certain accrued benefits upon death of a beneficiary. 38 U.S.C. § 5121. Periodic monetary benefits under laws administered by the Secretary 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 a surviving spouse, be paid to the veteran's children [a "child" for VA purposes is very specific and includes those under the age of 18 years of age or who became permanently incapable of self-support before reaching 18 years of age; see 38 C.F.R. § 3.57 ]. 38 U.S.C. § 5121(a)(3); 38 C.F.R. § 3.1000(a)(2). In all other cases, only so much of the accrued benefits may be paid as may be necessary to reimburse the person who bore the expense of last sickness and burial. 38 U.S.C. § 5121(a)(6); 38 C.F.R. § 3.1000(a)(5). Unfortunately, this case presents inconsistencies that must be reconciled before a Board decision may be made. As the VA audit of the surviving spouse's account does not clarify matters, an amended audit should be conducted. The October 2021 audit, as well as other evidence in the file, indicates that death pension benefits at the maximum allowable rate were paid to the surviving spouse for the period beginning March 1, 2015 but that benefits in the maximum allowable amount, totaling $9,097 for the period of July 1, 2014 through February 2015, were withheld pending a fiduciary appointment. (It is unclear why funds were released beginning in March 2015 if the fiduciary matter had not been resolved by that time.) The audit, however, does not square with the reasons and bases for the denial of accrued benefits greater than $1,562, which were given by the VA in the statement of the case (SOC) issued to the appellant in August 2017. The audit reflects that the surviving spouse was due/entitled to the maximum allowable amount of death pension (at the aid and attendance rate) for the entire period from July 1, 2014 through July 2015 [inexplicably, the period does not end on August 31, 2015, as previously indicated in a September 2015 VA letter in regard to the suspension of the pension benefits effective September 1, 2015]. However, the explanation given by the VA in the August 2017 SOC indicates that a recalculation of the surviving spouse's entitlement to death pension shows that she was not actually owed the maximum allowable amount and instead was owed far fewer benefits (i.e., monthly payments of $13.50). The VA stated that it needed to recalculate the pension award because it had used the caregiver [in-home health care] fees as a monthly medical expense to reduce her income to zero so as to allow her to receive the maximum allowable amount. (The VA also stated it could not use the assisted living fees as a medical expense because it was paid by her long-term care insurance.) The VA provided no reason for not deeming the monthly in-home health care fees a valid medical expense. [Under the law, the maximum annual rate of death pension payable to a surviving spouse is based on the amount of countable income received. Pension is payable at a specified annual maximum rate, which is reduced on a dollar-for-dollar basis by income on a 12-month annualized basis. 38 U.S.C. §§ 1503, 1541; 38 C.F.R. §§ 3.3, 3.23. For purposes of calculating pension benefits, total income may be reduced by amounts equal to the amounts paid by a surviving spouse for unreimbursed medical expenses (to the extent that such amounts exceed five percent of the applicable maximum annual pension rate for the surviving spouse as in effect during the 12-month annualization period in which medical expenses were paid). 38 U.S.C. § 1503(a)(8); 38 C.F.R. § 3.272(g). The maximum annual rate of death pension for a surviving spouse with aid and attendance (and no dependents) is $13,563 effective December 1, 2013 and $13,794 effective December 1, 2014.] The October 2021 audit, unfortunately, does not show how the VA calculated the amounts due and paid, in addition to only considering the period through July 2015 rather than through August 2015. It is noted that in the March 2015 award letter, the VA awarded the maximum allowable pension because it calculated the surviving spouse's countable income as $0 after finding that her medical expenses ($31,068 annually) exceeded her annual income (from SSA benefits). It is not clear how the VA calculated such medical expenses. The foregoing questions, including an inquiry into why pension benefits were paid from March 2015 when a fiduciary appointment was still evidently pending, should be addressed in an amended audit. The matter is REMANDED for the following action: (Continued on the next page) Prepare an amended audit of the surviving spouse's death pension benefits account for the period of June 2014 through August 2015, which reflects the total amounts due and paid to her and includes the amounts of income considered in determining pension entitlement as well as the unreimbursed medical expenses used to reduce countable income. Regarding medical expenses, the audit should specifically indicate what expenses may be used to reduce income and provide a full explanation if any of the reported expenses (e.g., any in-home health care fees) are not used. Further, provide an explanation for why pension benefits were paid effective from March 1, 2015 (see the October 2021 audit) when the process to appoint a fiduciary had evidently not been completed by the time of the surviving spouse's death in August 2015 (as reflected by the withheld pension totaling $9,097 from July 2014 through February 2015 in the audit). Furnish the appellant a copy of the audit and afford her an opportunity to respond. L. B. CRYAN Veterans Law Judge Board of Veterans' Appeals Attorney for the Board Debbie Breitbeil, 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.