VA PROCEEDINGS TO REDUCE A RATING OR SEVER SERVICE
From NVLSP Veterans Benefits Manual 2002 edition. Current versions available Here
5.9.1 Protections against Reductions after Ten and Twenty Years of Continuous Benefits or Rating at a Particular Level
5.9.2 Rules Regulating the Reduction of Total (100%) Disability Evaluations
5.9.3 The Requirement of Sustained Improvement to Reduce a Rating Level That Has Been in Effect for Five or More Years
5.9.4 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)
5.9.5 Protection against Reductions Based on Revision of the Schedule for Rating Disabilities
5.9.6 The Remedy for Violation of the Rules Regulating Reductions in Disability Ratings Is Reinstatement of the Rating
5.9.7 The Process by Which Running Awards of Compensation Are Reduced or Terminated
The VA reexamination process discussed in the previous Section sometimes results in a determination that the veteran’s disability has decreased in severity. Sometimes the VA seeks to reduce a veteran’s disability rating, or to terminate service-connected status entirely.428 In some situations the veteran’s rating, or even the service-connected status of a disability, is “protected.” In some situations the VA is completely prohibited by statute or regulation from reducing a rating or severing (terminating) service connection unless fraud was involved. A veteran with a protected rating or protected service connection that was obtained without fraud is guaranteed benefits at a certain minimum level for the rest of the veteran’s 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. The various rules that protect veterans against reductions in ratings or severance of service connection are discussed below. For example, veterans who have been assigned 100 percent schedular evaluations, 100 percent evaluations based on individual unemployability, or veterans who have had ratings that have been in effect for 5 years or more receive special protection.
Footnotes
428.38 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 VA regulations that govern the adjudicative procedures for rendering forfeiture decisions provide specific procedural protections to an affected claimant. See 38 C.F.R. §§ 3.900 through 3.905 (2002). 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. See 38 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). 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. See Trilles, 13 Vet. App. at 319.
5.9.1 Protections against Reductions after Ten and Twenty Years of Continuous Benefits or Rating at a Particular Level
If a rating level or benefit has been continuously in effect for a certain length of time, it may be protected by law from reduction or severance. For example, after ten years of the veterans 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.429 Similarly, 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.430 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.431 (The concept of clear and unmistakable error is discussed in Section 14.4 of the Manual.)
Footnotes
429. 38 U.S.C.S. § 1159; 38 C.F.R. § 3.957 (2002).
430. 38 U.S.C.S. § 110; 38 C.F.R. § 3.951(b) (2002); See Colayong v. West, 12 Vet. App. 524, 531-32(1999) (veteran’s 60 percent rating for Pott’s disease that has been in effect for at least twenty years is preserved by operation of law) cf. 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)).
431. Gen. Coun. Prec. 68-91 (September 26, 1991).
5.9.1 Protections against Reductions after Ten and Twenty Years of Continuous Benefits or Rating at a Particular Level
If a rating level or benefit has been continuously in effect for a certain length of time, it may be protected by law from reduction or severance. For example, after ten years of the veterans 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.429 Similarly, 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.430 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.431 (The concept of clear and unmistakable error is discussed in Section 14.4 of the Manual.)
Footnotes
429. 38 U.S.C.S. § 1159; 38 C.F.R. § 3.957 (2002).
430. 38 U.S.C.S. § 110; 38 C.F.R. § 3.951(b) (2002); See Colayong v. West, 12 Vet. App. 524, 531-32(1999) (veteran’s 60 percent rating for Pott’s disease that has been in effect for at least twenty years is preserved by operation of law) cf. 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)).
431. Gen. Coun. Prec. 68-91 (September 26, 1991).
5.9.2 Rules Regulating the Reduction of Total (100%) Disability Evaluations
Unlike other administrative actions, a reduction in a veteran’s 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 veteran’s disability rating is permitted only where certain circumstances exist and where particular legal guidelines have been satisfied.432 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.433
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 veteran’s current symptomatology is equal to the symptomatology needed for the 100 percent evaluation.434 However, in the absence of clear error in its previous total disability rating, the issue it must decide is whether there has been material improvement in the physical or mental condition evaluated as 100 percent disabling.435 Without an examination that confirms such improvement, the VA is prohibited from reducing the veteran’s rating.436
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.437 In Karnas v. Derwinski,438 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. In deciding whether there has been improvement in the veteran’s condition, the CAVC has held that the VA may look at both medical and nonmedical evidence to determine whether a veteran’s condition has materially improved.439
**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.”440 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 veteran’s service-connected condition still meets the definition of 100 percent in the rating schedule. However, 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 veteran’s 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 substantial 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 (IU) provisions of 38 C.F.R. § 4.16.441 Moreover, once a veteran is in receipt of benefits at the total rating level based on IU, the VA may not reduce the benefits unless “clear and convincing evidence” establishes that the veteran is capable of “actual employability.”442
Footnotes
432. See 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”).
433. See Hayes v. Brown, 9 Vet. App. 67, 73 (1996); Kitchens v. Brown, 7 Vet. App. 320, 325 (1995); Brown v. Brown, 5 Vet. App. 413, 421 (1993).
434. See Dofflemyer v. Derwinski, 2 Vet. App. 277, 279-80 (1992) (“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 appellant’s rating from 100% to 10% was proper.”); Peyton v. Derwinski, 1 Vet. App. 282, 286 (1991) (“This is a rating reduction case, not a rating increase case”).
435. 38 C.F.R. § 3.343(a) (2002).
436.38 C.F.R. § 3.343(a) (2002). Temporary 100% 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.” See 38 C.F.R. §§ 4.28, 4.29, 4.30 (2002) (regulations governing prestabilization ratings and total ratings assigned because the veteran is hospitalized or convalescing).
437. See Ternus v. Brown, 6 Vet. App. 370, 376 (1994); Dofflemyer, 2 Vet. App. at 280; Hohol v. Derwinski, 2 Vet. App. 169, 173 (1992).
438.1 Vet. App. 308 (1991).
439. Faust v. West, 13 Vet. App. 342, 349-50 (2000).
440. 38 C.F.R. § 3.343(a) (2002); see Ternus, 6 Vet. App. at 376; Dofflemyer, 2 Vet. App. at 280; Hohol, 2 Vet. App. at 173; Karnas, 1 Vet. App. at 308.
441. Hohol, 2 Vet. App. 169, 173 (1992); Gleicher v. Derwinski, 2 Vet. App. 26, 28 (1991); Karnas, 1 Vet. App. at 311; see also Manual M21-1, Part VI, ¶ 9.03(l).
442. 38 C.F.R. § 3.343(c) (2002). See Faust, 13 Vet. App. at 356. In that case, the CAVC held that evidence that indicates that a veteran is engaged in substantial gainful employment establishes that the veteran is capable of “actual employability.” Id. The Court then adopted a definition for the term substantial gainful employment for the purposes of determining whether the veteran was capable of “actual employability.” The Court concluded that substantial gainful employment must be employment that is more than marginal. The Court determined that substantial gainful employment is “[an occupation] that provides annual income that exceeds the poverty threshold for one person, irrespective of the number of hours or days that the veteran actually works and without regard to the veteran’s earned annual income prior to his having being awarded a 100% rating based on individual unemployability.” Id.; Olson v. Brown, 5 Vet. App. 430, 434 (1993).
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