Rating Reduction or Sever Service – Veterans Affairs Proceedings

The following is from the Veterans Benefits Manual by NVLSP.

5.10  VA PROCEEDINGS TO REDUCE A RATING

5.10.1  The Requirement of Sustained Improvement to Reduce a Rating Level That Has Been in Effect for Five or More Years

5.10.2  Protections against Reductions after Twenty Years of Continuous Rating at a Particular Level

5.10.3  Rules Regulating the Reduction of Total (100 Percent) Disability Evaluations

5.10.4  Rating Reduction in Unprotected Cases (Cases Involving Disabilities Where the Veteran Does Not Have Either a Total Disability or a Disability Rating That Has Been in Effect for Five Years or More)

5.10.5  Protection against Reductions Based on Revision of the Schedule for Rating Disabilities

5.10.6  The Remedy for Violation of the Rules Regulating Reductions in Disability Ratings Is Reinstatement of the Rating

5.10.7  The Process by Which Running Awards of Compensation Are Reduced

The VA reexamination process discussed in the previous Section sometimes results in a determination that the veterans disability has decreased in severity. Sometimes the VA seeks to reduce a veterans disability rating, or to terminate service-connected status entirely. 520 Unlike other administrative actions, a reduction in a veterans disability evaluation is not permitted merely because a later adjudicator has a different opinion on how the evidence or the rating schedule should be interpreted. A reduction in a veterans disability rating is permitted only where certain circumstances exist and where particular legal guidelines have been satisfied. 521 Before any existing disability evaluation can be lawfully reduced, VA is obligated to satisfy a variety of legal requirements. Moreover, the VA bears the burden of proof in establishing, by a preponderance of the evidence, that a reduction is warranted under the relevant regulations. 522

In some situations, the veterans rating, or even the service-connected status of a disability, is protected. In these situations, the VA is entirely prohibited by statute or regulation from reducing a rating unless fraud was involved. A veteran with a protected rating that was obtained without fraud is guaranteed benefits at a certain minimum level for the rest of the veterans life.

In other situations, the VA must ensure that certain requirements are met before it may lawfully reduce a disability rating level. If the requirements are not met, the improperly reduced benefits must be reinstated. For example, veterans who have been assigned 100 percent schedular evaluations or 100 percent evaluations based on individual unemployability, or veterans who have had ratings that have been in effect for five years or more, receive special protection. The various rules that protect veterans against reductions in ratings are discussed below.

Footnotes

  1. 520. For information on the severance of service connection, see Section 11.
  2. 521See Dofflemyer,   2 Vet. App. at 280 (There is no question that a disability rating may be reduced; however, the circumstances under which rating reductions can occur are specifically limited and carefully circumscribed by regulations promulgated by the Secretary.).
  3. 522See Hayes,   9 Vet. App. at 73; Kitchens v. Brown,   7 Vet. App. 320, 325 (1995); Brown v. Brown,   5 Vet. App. 413, 421 (1993).

5.10.1  The Requirement of Sustained Improvement to Reduce a Rating Level That Has Been in Effect for Five or More Years 

Any rating evaluation that has stabilized, that is, continued for [a] long period[] at the same level (five years or more), 523 whether it is at the 10 percent or 100 percent level, may not be reduced unless all the evidence of record shows sustained improvement in the disability. 524

Because 38 C.F.R. 3.344(a) requires that all the evidence of record support the conclusion that sustained improvement in the disability has occurred, the VA cannot view the single examination upon which the reduction is proposed in isolation from the rest of the record. 525 In other words, the entire medical history of the disability must always be considered in conjunction with any rating examination upon which a reduction is proposed. 526 In Schafrath v. Derwinski, the court explained the purpose of this rule as follows:

These requirements for evaluation of the complete medical history of the claimants condition operate to protect claimants against adverse decisions based on a single, incomplete or inaccurate report and to enable VA to make a more precise evaluation of the level of the disability and of any changes in the condition. These considerations are especially strong in a ratings reduction case. 527

It is precisely because a disability is stabilized that the VA must take care when proposing to reduce the rating evaluation assigned to it. Because [s]uch disabilities are considered stabilized, . . . the regulation thus requires a high degree of accuracy in decisions reducing those ratings. 528

There are several other rules the VA must follow before reducing a rating that has been in effect for five years or more. The VA must review the entire record of examinations and the medical-industrial history . . . to ascertain whether the recent examination [upon which the VA is relying to reduce the rating] is full and complete. 529 Any examination that is less full and complete than that examination on which payments were authorized or continued may not be used as a basis of reduction. 530 If the disability is subject to temporary and episodic improvement, it will not be reduced on any one examination, except in those circumstances in which all the evidence of record clearly warrants the conclusion that sustained improvement has been demonstrated. 531 Even though material improvement in the physical or mental condition is clearly demonstrated, the VA will [consider] whether the evidence makes it reasonably certain that the improvement will be maintained under the ordinary conditions of life. 532

Footnotes

  1. 523.38 C.F.R. 3.344(c) (2007).
  2. 524. 3.344(a).
  3. 525.Schafrath,   1 Vet. App. at 594.
  4. 526.Id.; see alsoBrown,   5 Vet. App. at 421.
  5. 527.Id.
  6. 528.Id.
  7. 529.Brown,   5 Vet. App. at 419(citing 38 C.F.R. 3.344(a)).
  8. 530.38 C.F.R. 3.344(a) (2007); see alsoBrown,   5 Vet. App. at 419.
  9. 531.38 C.F.R. 3.344(a) (2007); see alsoBrown,   5 Vet. App. at 419.
  10. 532.38 C.F.R. 3.344(a) (2007); see alsoBrown,   5 Vet. App. at 419.

 


5.10.2  Protections against Reductions after Twenty Years of Continuous Rating at a Particular Level

 If a disability has been continuously rated at or above a particular rating level for twenty or more years, the VA cannot reduce the rating below that level unless it discovers that the rating was based on fraud. 533 For example, if a veteran is granted compensation based upon an original rating of 30 percent and for the next twenty years the rating varies between 30 percent and 100 percent, the rating cannot thereafter be reduced below 30 percent in the absence of fraud. The twenty-year protection rule applies even to rating levels that are assigned retroactively because a previous final decision is revised based on a finding of clear and unmistakable error (CUE). That is, if a rating is retroactively increased [based on a finding of CUE] and the effective date of such increase is more than twenty years in the past, the revised disability percentage is protected by the twenty-year protection rule. 534 (The concept of clear and unmistakable error is discussed in Section 14.4 of this Manual.)

Footnotes

  1. 533.38 U.S.C.S.  110; 38 C.F.R. 3.951(b)(2007); SeeColayong,   12 Vet. App. at 531-32 (veterans 60 percent rating for Potts disease that has been in effect for at least twenty years is preserved by operation of law); C Dofflemyer v. Derwinski,   2 Vet. App. 277, 280 (1992) (a rating twenty days short of having been in effect for twenty years was not protected from reduction by 3.951(b)).
  2. 534. Gen. Coun. Prec. 68-91(Sept. 26, 1991).

5.10.3  Rules Regulating the Reduction of Total (100 Percent) Disability Evaluations

 Advocates unfamiliar with veterans law might logically think that when the VA considers reducing a total (100 percent) rating, the issue to be decided is whether the veterans current symptomatology is equal to the symptomatology needed for the 100 percent evaluation. 535 However, in the absence of clear error in its previous total disability rating, the issue the VA must decide is whether there has been material improvement in the physical or mental condition evaluated as 100 percent disabling. 536 Without an examination that confirms such improvement, the VA is prohibited from reducing the veterans rating. 537

The VA must compare the evidence it relied on in its most recent decision to continue the 100 percent evaluation with the evidence it intends to rely upon to reduce the 100 percent evaluation. 538 In Karnas v. Derwinski539 the CAVC ruled that if there has been no improvement at all since the date of the last examination continuing the 100 percent rating, a reduction is prohibited. When deciding whether there has been improvement in the veterans condition, the CAVC has held that the VA may look at both medical and nonmedical evidence to determine whether a veterans condition has materially improved. 540

**Advocacy Tip** In some instances, the evidence reveals some improvement in the service-connected disability. If this is the case, advocates are advised to compare the most recent evidence with the earlier evidence used to continue or establish the 100 percent evaluation. If feasible, the advocate should argue that there has been no improvement. Alternatively, the advocate should argue that even though there has been some improvement in the service-connected condition, this is not significant enough to constitute material improvement because some improvement does not constitute material improvement.

The regulations also preclude a reduction unless the improvement was attained under the ordinary conditions of life, i.e., while working or actively seeking work. 541 A private medical opinion stating that the claimant has not medically improved since the 100 percent evaluation was assigned or continued can be crucial in these cases. A common tactical advocacy error is to argue that the severity of the veterans service-connected condition still meets the definition of 100 percent in the rating schedule. As stated earlier, the issue is not what percentage evaluation the current symptomatology warrants but whether the service-connected condition has materially improved. Therefore, advocates should refer to the rating schedule but not rely on it exclusively.

Even if the VA is justified in reducing a total rating after applying the rating reduction rules described above, an additional rule applies that may result in the preservation of the veterans entitlement to benefits at the total rating level. If the VA determines that a reduction in a total schedular rating (100 percent) is warranted, but the record reflects that the veteran is unable to engage in substantially gainful employment by virtue of his or her service-connected disability, the veteran must be awarded a total (100 percent) rating based on the individual unemployability (TDIU) provisions of 38 C.F.R. 4.16. 542 Moreover, once a veteran is in receipt of benefits at the total rating level based on TDIU, the VA may not reduce the benefits unless clear and convincing evidence establishes that the veteran is capable of actual employability. 543

Footnotes

  1. 535.SeeDofflemyer,   2 Vet. App. at 279-80 (The BVA incorrectly phrased the issue in terms of whether appellant was entitled to an increased rating; in fact and in law, the issue presented to the BVA, and to this Court, is not whether the veteran was entitled to an increase but whether the reduction of appellants rating from 100% to 10% was proper.); Peyton,   1 Vet. App. at 286 (This is a rating reduction case, not a rating increase case).
  2. 536.38 C.F.R. 3.343(a) (2007).
  3. 537. 38 C.F.R. 3.343(a) (2007). Temporary 100 percent ratings are not subject to the general rule established by 38 C.F.R. 3.343(a) that reductions of a total rating be based on material improvement.See38 C.F.R. 4.28, 4.29, 4.30 (2007) (regulations governing prestabilization ratings and total ratings assigned because the veteran is hospitalized or convalescing).
  4. 538.SeeTernus v. Brown,   6 Vet. App. 370, 376 (1994); Dofflemyer,   2 Vet. App. at 280; Hohol v. Derwinski,   2 Vet. App. 169, 173 (1992).
  5. 539. 1 Vet. App. 308(1991).
  6. 540.Faust v. West,   13 Vet. App. 342, 349-50 (2000).
  7. 541.38 C.F.R. 3.343(a) (2007); seeTernus,   6 Vet. App. at 376; Dofflemyer,   2 Vet. App. at 280; Hohol,   2 Vet. App. at 173; Karnas,   1 Vet. App. at 308.
  8. 542.Hohol,   2 Vet. App. 169, 173 (1992); Gleicher v. Derwinski,   2 Vet. App. 26, 28 (1991); Karnas,   1 Vet. App. at 311; seealso Manual M21-1MR, Part III, subpart iv, 8.D.14(b).
  9. 543.38 C.F.R. 3.343(c) (2007). SeeFaust,   13 Vet. App. at 356. In that case, the CAVC held that evidence that indicates that a veteran is engaged in substantially gainful employment establishes that the veteran is capable of actual employability.Id.  See Section 5.1 for a discussion of substantially gainful employment.

5.10.4  Rating Reduction in Unprotected Cases (Cases Involving Disabilities Where the Veteran Does Not Have Either a Total Disability or a Disability Rating That Has Been in Effect for Five Years or More)

 Although the protections discussed above are limited to total (100 percent) disabilities and disabilities where the rating has been in effect for five years or more, 544 the advocate may still wish to argue that other VA regulations and substantive rules protect a disability rating from being reduced. In Faust v. West545 the CAVC made clear that the VA is required to comply with several general VA regulations regardless of the rating level or the length of time that the rating has been in effect. For example:

Any proposed reduction must be based upon review of the entire history of the veterans disability;

The VA must determine whether there has been an actual change in the disability;

Any improvement must reflect an improvement in the veterans ability to function under the ordinary conditions of life and work; and

Examination reports reflecting any such change must be based on thorough examinations.

**Advocacy Tip** The following argument includes boilerplate language that an advocate may wish to use in such a case.

VA regulations impose a duty on the VA to make an explicit finding that the preponderance of evidence shows that there has been improvement in any disability rating that the VA proposes to reduce. Specifically, 38 C.F.R. 4.1 (2007) states that [i]t is . . . essential, both in the examination and in the evaluation of the disability, that each disability be viewed in relation to its history. Similarly, 38 C.F.R. 4.2 (2007) establishes that [i]t is the responsibility of the rating specialist to interpret reports of examination in light of the whole recorded history, reconciling the various reports into a consistent picture so that the current rating may accurately reflect the elements of disability present. These provisions impose a clear requirement that VA rating reductions, as with all VA rating decisions, be based upon review of the entire history of the veterans disability. . . . Furthermore, 38 C.F.R. 4.13 (2007) provides: When any change in evaluation is to be made, the rating agency should assure itself that there has been an actual change in the conditions, for better or worse, and not merely a difference in [the] thoroughness of the examination or in use of descriptive terms.

Pursuant to these provisions, it is obvious that in any rating-reduction case, the RO and BVA are required to ascertain, based upon review of the entire recorded history of the condition, whether the evidence reflects an actual change in the disability and whether the examination reports reflecting such change are based upon thorough examinations. 546

Thus, the VA is required to review the entire evidence of record and to determine and make an explicit finding as to whether the evidence shows that there is an actual improvement in a veterans disability since the last rating decision which either granted or continued the disability rating before the VA may reduce the disability rating.

In addition to these VA regulations, Manual M21-1MR, Part III, subpart iv, 8.D.12(b) requires the VA to make findings that the evidence demonstrates improvement before a rating reduction is made. Specifically, it states that the VA must:

   outline the time period in which application of 38 C.F.R. 3.344 (stabilization of disability evaluations) is based cite evidence of sustained improvement after one review examination, or a preponderance of evidence showing sustained improvement based on more than one examination and explain why it is reasonably certain that improvement will be maintained under the ordinary conditions of life. Therefore, the VA may not lawfully reduce a disability rating unless it addresses whether the condition has actually improved since the time it was either granted or continued.

Footnotes

  1. 544.SeeSmith (Raymond L.) v. Brown,   5 Vet. App. 335, 339 (1993).
  2. 545.13 Vet. App. 342, 349 (2000).
  3. 546.Brown v. Brown,   5 Vet. App. 413, 420-21 (1993). See alsoLehman v. Derwinski,   1 Vet. App. 339, 342-43 (finding that the Board violated 38 C.F.R. 4.1, 4.2 where the Board relied upon one medical report which drastically differed from all other evidence of record without reconciling the evidence).

5.10.5  Protection against Reductions Based on Revision of the Schedule for Rating Disabilities

 The VA is required by statute to readjust the Schedule for Rating Disabilities from time to time . . . in accordance with experience. 547 However, this statute also requires that in no event shall such a readjustment . . . cause a veterans disability rating in effect on the effective date of the readjustment to be reduced unless an improvement in the veterans disability is shown to have occurred. 548

The VAs application of this requirement, made binding by a precedent opinion of the VA General Counsel, is that it must continue to apply the old rating criteria to a veterans disability if application of new rating criteria would cause the veterans rating level to be reduced. 549 Therefore, if an examination reveals any improvement in a veterans condition and application of the new rating criteria would result in a reduction in the veterans disability rating, before reducing the rating the VA must also apply and consider the old rating criteria. If application of the old rating criteria would not result in a reduction of the rating, the rating may not be reduced. 550 However, the VA General Counsel has held that when an improvement in a disability sufficient to warrant a reduction under the old criteria occurs. . . the new rating criteria should be applied. The new criteria should be applied, even in cases where their application will result in a rating reduction greater than would result from application of the old rating criteria. 551

Footnotes

  1. 547.38 U.S.C.S.  1155.
  2. 548. Id.
  3. 549. Gen. Coun. Prec. 19-92(Sept. 29, 1992).
  4. 550. Id. at 5.
  5. 551. Id.

5.10.6  The Remedy for Violation of the Rules Regulating Reductions in Disability Ratings Is Reinstatement of the Rating

 A reduction of a veterans rating generally may not be valid if the VA fails to comply with the rating reduction rules described above. The CAVC has held that rating reductions made without observance of law require reinstatement of the rating, retroactive to the date of the erroneous reduction. 552 The court reasons that the original reduction decision in such cases is void from the start (void ab initio) because of the VAs failure to follow the requirements that control rating reductions. 553 Because the veteran should not be subjected to the effects of an unlawful rating reduction, such a reduction must be vacated and the prior rating restored. 554 However, in Faust v. West, 555 the Court recently affirmed a rating reduction in a case even though the Court had found that the BVA had reduced the veterans 100 percent disability rating for a psychiatric condition without applying pertinent regulations. The Court reasoned that the BVAs failure to explicitly discuss relevant rating reduction regulations was harmless error because the Boards decision contained findings that essentially met the criteria of the regulations and there was overwhelming evidence to indicate that the veterans disability rating was properly reduced. 556 

Footnotes

  1. 552.SeeGreyzck v. West,   12 Vet. App. 288, 292 (1999); Kitchens v. Brown,   7 Vet. App. 320, 325 (1995); Murincsak v. Derwinski,   2 Vet. App. 363, 369 (1992); Schafrath,   1 Vet. App. at 595 (1991);Dofflemyer,   2 Vet. App. at 282; Hohol,   2 Vet. App. at 173; Schafrath,   1 Vet. App. at 595-96; Lehman,   1 Vet. App. at 342.
  2. 553.Dofflemyer,   2 Vet. App. at 282; Schafrath,   1 Vet. App. at 596.
  3. 554.Schafrath,   1 Vet. App. at 596; see alsoHayes,   9 Vet. App. at 73; Kitchens,   7 Vet. App. at 325; Brown,   5 Vet. App. at 422.
  4. 555.13 Vet. App. 342(2000).
  5. 556.Id. at 352-53.

5.10.7  The Process by Which Running Awards of Compensation Are Reduced

 Special due process protections apply in cases where the VA proposes to reduce running awards of disability compensation. First, a claimant facing such a reduction must be given prior notice of the proposed adverse action. 557 The notice must be specific enough to satisfy the regular notice of decision requirements. 558 Moreover, the claimant must then be given at least 60 days after the notice within which to submit evidence for the purpose of showing that the adverse action should not be taken. 559 If the claimant does not submit evidence within the 60-day period, a final rating decision will be prepared. 560 The veteran is notified of the final rating decision and the award of benefits will be reduced. 561 A new 60-day period begins from the date of the final decision. The reduction goes into effect on the last day of the month on which the new 60-day period expires. 562

There are a few important exceptions to the prereduction notice requirement. 563 According to a precedent opinion of the VA General Counsel, the VA is not obligated to comply with the advance notice requirements set out at 38 C.F.R. 3.105(e) when proposing to reduce a compensation award if the actual amount of compensation paid is not reduced as a result of the proposed rating reduction. 564 In addition, if the claimant provides oral or written statements that are factual, and contain unambiguous information about income, net worth, dependency, or marital status with knowledge or notice that the information will be used to calculate benefits, no prior notice is required. 565 Instead, the VA must only give contemporaneous notice of the reduction or termination. 566 Also, contemporaneous, rather than prior, notice of an adverse decision is permitted if evidence reasonably indicates that a claimant is deceased. 567

Another important protection in cases where the VA proposes a reduction of a running award of compensation is the claimants right to a predetermination hearing. 568 The hearing must be requested within 30 days from the date of the notice of the proposed adverse action. 569 The regulation providing for the predetermination hearing specifies that the hearing will be conducted by VA personnel who did not participate in the proposed adverse action. 570 If a claimant requests a hearing within the 30-day period, the proposed decision will not be implemented, if at all, until after the hearing takes place and the VA considers the evidence presented or developed as a result of the hearing and issues a final determination concerning the proposed action. 571

A benefit of asking for a hearing within the 30-day period is that implementation of any reduction of benefits is delayed. In compensation cases, the adverse action will never be implemented until at least 60 days after notice of the final action is sent to the claimant. 572 Thus, a claimant requesting a hearing can buy at least two months of benefits at the level in effect at the time of the notice.

**Advocacy Tip** Claimants faced with a proposed reduction of a running award of compensation should always ask for a hearing within thirty days of the date of the notice of the proposed decision. This request will work to prevent implementation of the reduction for the longest possible period, because the adverse action will not be final until after the hearing.

** Advocacy Tip** Advocates are advised to argue that if a rating decision retroactively establishes an evaluation at a certain percentage, that evaluation is protected and thus the VA should apply and consider all protective regulations 573 before the evaluation is reduced. Note, however, that this issue was not addressed in Fenderson, 574 nor has it been litigated before the CAVC.

The Veterans Claims Assistance Act of 2000 (VCAA or Act) impacts the type of notice that is sent to claimants when the VA proposes to reduce the veterans disability rating. The VCAA requires the VA to notify all claimants and their representatives of any information, and any medical or lay evidence, not previously provided to the Secretary that is necessary to substantiate the claim. In addition, the VA is required to explain to the claimant what evidence the claimant must obtain and what evidence the VA will attempt to obtain. Therefore, when the VA proposes to reduce a disability rating, the notice required by the VCAA should include advice as to the type of evidence, both medical and lay, that the veteran should submit to avoid a reduction in the disability rating.

Footnotes

  1. 557.38 C.F.R. 3.103(b)(2), 3.105(e) (2007); see alsoManual M21-1MR, Part III, subpart ii, 3.A (due process procedures for reductions and severance of service connection).
  2. 558.38 U.S.C.S.  5104; 38 C.F.R. 3.103(b)(2) (2007).
  3. 559.;See also 38 C.F.R. 3.103(b)(2), 3.105(d),(f) (2007).
  4. 560.38 C.F.R. 3.105(d), (f) (2007).
  5. 561.Id.
  6. 562.Id. 3.105(d)(e).
  7. 563.Id. 3.103(b)(3).
  8. 564. Gen. Coun. Prec. 71-91(Nov. 7, 1991). In the particular case that produced this VA General Counsel opinion, the claimants compensation payment at the 100 percent level was unaffected even though his rating for residuals of gunshot wounds was reduced from 20 percent to 0 percent. This result occurred because another of the claimants disability ratings was increased from 70 percent to 100 percent, thus leaving the overall amount of compensation paid to him unaffected.
  9. 565.VA regulations specify the procedures that the VA is to follow when it receives oral information from a claimant. See38 C.F.R. 3.217(b) (2007). The VA may not take action based on oral information or statements unless the VA employee receiving the information follows certain procedures. For example, during the conversation with the claimant, the VA employee must identify himself or herself to the claimant as a VA employee who is authorized to take the action. The VA employee must verify the identity of the claimant by obtaining information that can be verified from the claimants VA records such as social security number, date of birth, branch of military service, or dates of military service. 38 C.F.R. 3.217(b)(1)(i)-(ii) (2007). The VA employee must inform the claimant that the information or statement will be used for calculating benefits. 38 C.F.R. 3.217(b)(1)(iii) (2007). Finally, the VA employee must document the conversation in the claimants VA records by recording the specific information or statement that was provided, the date that statement or information was provided, the identity of the claimant or person who provided the information, the steps taken to verify the identity of the claimant, and that the VA employee advised the claimant that the information would be used for purposes of calculating benefit amounts. 38 C.F.R. 3.217(b)(2) (2007).
  10. 566.38 C.F.R. 3.103(b)(3)(i) (2007).
  11. 567.Id. 3.103(b)(3)(iii).
  12. 568.Id. 3.105(i).
  13. 569.Id.
  14. 570.Id.
  15. 571.
  16. 572.Id. 3.105(h)(2)(i).
  17. 573.See 38 C.F.R. 3.327(b)(2), 3.343(a), 3.44(a) (2007).
  18. 574.12 Vet. App. 119(1999).

5.11  VA PROCEEDINGS TO SEVER SERVICE CONNECTION

 5.11.1  Severance of Service Connection Due to Fraud

5.11.2  Severance of Service Connection Due to Clear and Unmistakable Error in the Decision That Granted Service Connection

Sometimes, the VA seeks to sever (terminate) the veterans previously granted service connection entirely. This could be for a number of reasons, the most common being: (1) fraud and (2) clear and unmistakable error in the original service connection determination. 575 Both of these will be explored below. The process for severing service connection is identical to that for reduction of benefits, and the due process protections are the same. 576 For a description of that process, see Section 5.10.7.

As with reduction of benefits, certain grants of service connection are protected due to their longevity. For example, after ten years of the veterans (or DIC recipients) continuous receipt of service-connected disability or death benefits, the VA cannot sever the benefits (that is, terminate service-connected status) unless there was fraud involved in obtaining the rating or the VA discovers that the veteran did not have the required length or character of service. 577

Footnotes

  1. 575.Service connection may also be severed because of a change in law or VA issue, or a change in interpretation of a law or VA issue (in which case 38 C.F.R. 3.114applies), 38 C.F.R. 3.105(d) (2007).
  2. 576.Compare 38 C.F.R. 3.105(d) (2007) with 38 C.F.R. 3.105(e), (f), (g) and (h) (2007).
  3. 577.38 U.S.C.S.  1159; 38 C.F.R. 3.957(2007).

5.11.1  Severance of Service Connection Due to Fraud

 38 U.S.C.S.  6103 provides that a person who knowingly makes a false or fraudulent statement concerning any claim for VA benefits forfeits his or her rights to VA benefits. The decision as to whether the evidence warrants formal consideration of forfeiture is made by the Regional Counsel in most VAROs, and by the Veterans Service Center Manager in the VARO in Manila, Phillippines. 578

The VA regulations that govern the adjudicative procedures for rendering forfeiture decisions provide specific procedural protections to an affected claimant. 579 The VA will not declare a forfeiture until the VARO has sent the affected claimant a written notice containing the following: (1) a statement of the specific charges, (2) a detailed statement of evidence supporting the charges, (3) notice of the right to submit evidence or a statement in rebuttal or explanation within 60 days, (4) citation and discussion of the applicable statute, and (5) notice of the right to a hearing and representation by counsel. 580

If the affected claimant receives an adverse decision from the VARO, he or she may appeal this decision to the Board of Veterans Appeals, and if the Board denies the claim, an appeal may be taken to the Court of Appeals for Veterans Claims. 581 The Court reviews Board determinations of forfeiture under the clearly erroneous standard of review. 582

Footnotes

  1. 578.71 Fed. Reg. 52290 (Sept. 5, 2006).
  2. 579.See38 C.F.R. 3.900 through 3.905 (2007).
  3. 580.See38 C.F.R. 3.905(b); see also Trilles v. West,   13 Vet. App. 314 (2000) (good discussion of the law and procedures governing forfeiture).
  4. 581.See Trilles,   13 Vet. App. at 319.
  5. 582.Flores v. Nicholson,   19 Vet. App. 516(2006).

5.11.2  Severance of Service Connection Due to Clear and Unmistakable Error in the Decision That Granted Service Connection

 According to 38 C.F.R. 3.105(d), service connection will be severed only where evidence establishes that it is clearly and unmistakably erroneous. The burden of proof is on the Government.

Although clearly and unmistakably erroneous is the standard, there are several important distinctions between a severance case and a CUE case. 583 The most important is that, in severance cases, the inquiry does not stop with the information available to the VA at the time of the decision which granted service connection. 584 A post-decisional change in diagnosis may be accepted as a basis for severance action if the examining physician certifies that, in the light of all accumulated evidence, the diagnosis on which service connection was predicated is clearly erroneous. This certification must be accompanied by a summary of the facts, findings, and reasons supporting the conclusion. 585

There is an exception to the requirement that service connection have been clearly and unmistakably erroneous in order for it to be severed. This exception exists when the evidence establishes that service connection was clearly illegal. 586 An example of this situation can be found in the case of Allen v. Nicholson587 In Allen, two members of the New Mexico Army National Guard, appellant Allen and appellant Key, had been service connected for injuries they had sustained while quelling a state prison riot, for which purpose they had been called into duty by the Governor of New Mexico. 588 The Court affirmed the Boards severance of service connection, stating that the two Guardsmen were not legally eligible for benefits, since they had been called into the service of the State rather than the Federal government. 589 Because service connection was clearly illegal, the Court held, the Secretary no longer had the burden of proving clear and unmistakable error in the decision granting service connection. 590 Service connection was properly severed. 591

Footnotes

  1. 583.See Section 2.3of this Manual.
  2. 584.Allen (and Key) v. Nicholson,   21 Vet. App. 54, 59 (2007) (postdecisional evidence is relevant in determining whether the granting of service connection was clearly and unmistakably erroneous) (citing Daniels v. Gober,   10 Vet. App. 474, 480 (1997)); Stallworth v. Nicholson,   20 Vet. App. 482, 488 (2006) (the Secretary is not limited to the law and the record that existed at the time of the original decision).
  3. 585.38 C.F.R. 3.105(d) (2007).
  4. 586.38 C.F.R. 3.105(2007).
  5. 587.21 Vet. App. 54(2007).
  6. 588.at 55.
  7. 589.at 61.
  8. 590.at 58 (citing Venturella v. Gober,   10 Vet. App. 340, 342 (1997)).
  9. 591.Allen,   21 Vet. App. at 63.