BVA9401487 DOCKET NO. 90-23 331 ) DATE ) ) ) THE ISSUE Entitlement to accrued benefits based upon the veteran's entitlement to increased disability pension benefits during the income reporting year immediately prior to his death, due to an exclusion from countable income of unreimbursed medical expenses. REPRESENTATION Appellant represented by: David L. Nash, Attorney WITNESSES AT HEARING ON APPEAL Appellant and her niece ATTORNEY FOR THE BOARD S. L. Kennedy, Associate Counsel INTRODUCTION The veteran who served on active duty from March 11, 1942, to October 19, 1945, died on June [redacted] 1989. The appellant in this case is his surviving spouse. This matter came before the Board of Veterans' of Appeal (Board) on appeal from an October 18, 1989, denial letter of the Department of Veterans Affairs (VA), Winston-Salem, North Carolina, Regional Office (RO), which denied the appellant's claim for accrued benefits based upon unreimbursed medical expenses paid by the veteran during the year immediately preceding his death. The appellant's notice of disagreement was received by the RO on November 15, 1989. A statement of the case was issued on December 7, 1989. A substantive appeal was received on December 19, 1989. The appellant was afforded a personal hearing on April 24, 1990. The case was transferred to the Board, received on June 8, 1990, and docketed on June 14, 1990. The appellant's accredited representative at the time, The American Legion, submitted additional written argument to the Board on October 1, 1990. On November 27, 1990, the Board entered a decision, denying the appellant's appeal. In this decision, the Board concluded that accrued benefits were not created as the result of unreimbursed medical expenses paid prior to the veteran's death. Thereafter, the appellant appealed the November 1990 Board decision to the United States Court of Veterans Appeals (Court). In an August 14, 1992, order of the Court, the appellant's case was consolidated with another appeal which was before the Court, [citation redacted]. In this August 14, 1992, order, the Court, in pertinent part, vacated the November 27, 1990, Board decision, and remanded the case to the Board for full readjudication. [citation redacted]. On September 1, 1992, the Board received a power of attorney executed in favor of David L. Nash, Attorney, which authorized Mr. Nash to represent the appellant in the remand of her case to the Board by the August 14, 1992, order of the Court. Following this remand to the Board, Mr. Nash submitted "Appellant's Brief on Remand," received at the Board on November 3, 1992. By letter dated August 20, 1993, the appellant through her attorney, was provided opportunity for review and comment in response to an Opinion of the General Counsel(GC) of the VA which had been requested by the Board. On October 18, 1993, the Board received the "Appellant's Response to Opinion of General Counsel." REMAND This case is currently before the Board following an August 14, 1992, order of the Court which vacated, in pertinent part, a November 27, 1990, decision of the Board and remanded the case to the Board for full readjudication. The case at bar essentially involves a claim for accrued benefits by a surviving spouse on the basis of a pension eligibility verification report (EVR) detailing unreimbursed medical expenses for the period preceding the death of the veteran, but filed after the date of the death. Evidence in the record indicates that the veteran had been in receipt of nonservice-connected pension benefits from January 1977 with an award of special monthly pension based on aid and attendance from May 1986. The record indicates that his EVR reporting period ran from September 1 to August 31, annually. The record also reflects that the veteran had filed an EVR on an annual basis in each of the two years prior to his death, and based on the unreimbursed medical expenses paid by the veteran during the income reporting period, his countable annual income for each relevant period was adjusted accordingly on a retroactive basis. The veteran died on June [redacted] 1989, and the appellant, his surviving spouse, submitted the EVR for the annualized period from September 1, 1988, to August 31, 1989, claiming certain unreimbursed medical expenses, and which was received by the RO approximately 1 month after the veteran's death. Pursuant to the authority prescribed by 38 U.S.C.A. § 7104(c) (West 1991) and 38 C.F.R. 20.901(c) (1993), the Board requested an opinion from the General Counsel (GC) of the VA on the legal questions involved in the consideration of this appeal and the companion case which was also remanded to the Board by the Court's August 1992 order. On August 9, 1993, the GC issued an opinion on the following two questions presented by the facts of the consolidated cases: a) Under what circumstances, if any, may information contained in an eligibility verification report filed after a beneficiary's death be considered in determining eligibility for accrued benefits under 38 U.S.C. § 5121(a)? b) May an award of accrued benefits under 38 U.S.C. § 5121(a) be based on logical inferences from information of record at the date of the beneficiary's death? VA O.G.C. Prec. Op. No. 6-93 (Aug. 9, 1993), __ Fed. Reg. __, (a copy of which has been associated with the claims file). In response to these questions, the GC held that: a) Information contained in an eligibility verification report submitted after the beneficiary's death may not be considered "evidence in the file at date of death" for purposes of an award of accrued pension benefits under 38 U.S.C. § 5121(a). b) An award of accrued benefits under 38 U.S.C. § 5121(a) may be based on logical inferences from information in the file at the date of the beneficiary's death. VA O.G.C. Prec. Op. No. 6-93 (Aug. 9, 1993), __ Fed. Reg. __ . The Board is bound in its decisions by applicable statutes, VA regulations, instructions of the Secretary, and precedent opinions of the GC, except to the extent that they are inconsistent with binding judicial decisions. 38 U.S.C.A. § 7104(c) (West 1991); 38 C.F.R. § 19.5 (1993); Bernard v. Brown, 4 Vet.App. 384, 394 (1993). As the GC has essentially determined that the information contained in an EVR submitted by the appellant after the beneficiary's death may not be considered to "evidence in the file at date of death" pursuant to 38 U.S.C.A. § 5121 (West 1991), the remaining question for purposes of accrued benefits which must be addressed by the RO should focus on the logical inferences which may be made based on information in the file at the date of the veteran's death. The RO essentially must determine whether the unreimbursed medical expenses claimed by the appellant in the EVR submitted after the veteran's death were reasonably estimable, based the evidence on file at the date of his death, to include income and medical expense information contained in prior reports. In addition to determining whether there existed in the file at the date of the veteran's death prima facie evidence of the expenses related to unreimbursed medical expenses during the annualized period immediately preceding his death, the RO must also determine whether the prima facie evidence has been corroborated by satisfactory evidence of actual expenses paid during the annualized period in question. In this respect, the RO should not only consider the provisions of 38 U.S.C.A. §§ 1503(a)(8),1521, 5121 (West 1991) and 38 C.F.R. §§ 3.23, 3.271(a), 3.272(g), 3.273, 3.1000 (1993) in readjudicating the appellant's claim but also consider the applicability of the guidance as provided in the pertinent provisions of the VA Adjudication Procedure Manual relating to improved pension and accrued benefits including M21-1, Part IV, ch. 16, para. 16.31(e), regarding award action to allow medical expenses prospectively, and M21-1, Part IV, ch. 27, para. 27.08(b), relating to evidence in the file at the date of death (38 C.F.R. § 3.1000(d)(4) (1993)). VA Adjudication Procedure Manual, M21-1, Part IV, ch.16, para. 16.31(e)(Mar. 29, 1993); VA Adjudication Procedure Manual, M21-1, Part IV, ch.27, para. 27.08(b) (Apr. 3, 1992). In this regard, the Board has determined that the RO as the agency of original jurisdiction should readjudicate the appellant's case in light of the recently issued binding legal authority as presented in the August 1993 Precedent Opinion of the GC. Due to the precedential weight to be accorded this opinion, we find that a remand is required to safeguard the appellant's statutory and regulatory rights. It is important to note that this case involves a complex legal issue with binding legal authority recently issued. In order to assure procedural fairness to the appellant, she must be afforded notice and an opportunity to be heard in the course of its development. Accordingly, the Board has determined that no legal recourse is feasible other than remand to the RO for readjudication. In view of the foregoing, we have determined that a remand in this case is necessary to adjudicate the appellant's claim on the merits, and to provide adequate notice and opportunity to respond on behalf of the appellant. Accordingly, the case is REMANDED to the RO for the following action: 1. The RO should consider the appellant's claim for accrued benefits based upon the veteran's entitlement to increased disability pension benefits during the income reporting year from September 1, 1988, to August 31, 1989, with consideration of VA O.G.C. Prec. Op. No. 6-93 (Aug. 9, 1993), __ Fed. Reg. __. The RO should specifically consider the provisions of 38 U.S.C.A. §§ 1503(a)(8), 1521, 5121 (West 1991) and 38 C.F.R. §§ 3.23, 3.271(a), 3.272(g), 3.273, 3.1000 (1993) in readjudicating the appellant's claim and also consider the applicability of the guidance as provided by VA Adjudication Procedure Manual, M21-1, Part IV, ch.16, para. 16.31(e) (Mar. 29, 1993) and VA Adjudication Procedure Manual, M21-1, Part IV, ch.27, para. 27.08(b) (Apr. 3, 1992). 2. In readjudicating the appellant's claim under 38 U.S.C.A. § 5121(a) (West 1991), the RO must determine whether an award of accrued benefits may be based on logical inferences from information in the file at the date of the veteran's death on June [redacted] 1989, such as income and medical expense information submitted prior to the annualized period immediately preceding the date of the veteran's death. The RO must determine: (a) whether the unreimbursed medical expenses at issue, if any, may be considered to have been of a recurring nature in amounts reasonably estimable based upon evidence of record at the date of the veteran's death; (b) whether the evidence in the file at the date of death is prima facie evidence that similar unreimbursed medical expenses would be incurred during the annualized period immediately preceding the veteran's death; and (c) whether this prima facie evidence was corroborated by consistent evidence of actual unreimbursed medical expenses submitted after the veteran's death. 3. The RO should issue a formal decision detailing which claimed unreimbursed medical expenses in connection with the appellant's accrued benefits claim, if any, may be considered to be in the nature of unreimbursed medical expenses that were recurring, predictable, and reasonably estimable, based on the evidence of record at the date of the veteran's death and detailing whether those expenses are satisfactorily confirmed by corroborating evidence submitted by the appellant after the date of the veteran's death. If the determination remains adverse to the appellant, she should be provided a supplemental statement of the case that fully addresses the issue as outlined by paragraphs 1 and 2 above. This should contain a summary of additional evidence submitted and considered, citations of applicable laws and regulations, and the reasons for the decision. The appellant and her representative should be afforded an opportunity to respond thereto. Following completion of the above action, the case should be returned to the Board for further appellate action. The purpose of this REMAND is to afford the appellant due process of law. The Board intimates no opinion, either factual or legal, as to the ultimate conclusion warranted in this case. BOARD OF VETERANS' APPEALS WASHINGTON, D.C. 20420 E. M. KRENZER C. D. ROMO 38 U.S.C.A. § 7102(a)(2)(A) (West 1991) permits a Board of Veterans' Appeals Section, upon direction of the Chairman of the Board, to proceed with the transaction of business without awaiting assignment of an additional member to the Section when the Section is composed of fewer than three Members due to absence of a Member, vacancy on the Board or inability of the Member assigned to the Section to serve on the panel. The Chairman has directed that the Section proceed with the transaction of business, including the issuance of decisions, without awaiting the assignment of a third Member. Under 38 U.S.C.A. § 7252 (West 1991), only a decision of the Board of Veterans' Appeals is appealable to the United States Court of Veterans Appeals. This remand is in the nature of a preliminary order and does not constitute a decision of the Board on the merits of your appeal. 38 C.F.R. § 20.1100(b) (1993).