Phillips: Narrowing of TDIU Effective Dates post-AMA

Phillips v. McDonough, Case Number 22-2575, decided July 30, 2024 is a decision by the Veterans Court regarding the impact of the AMA on Rice and TDIU.

The Court ordered a panel review to “to address how this Court's existing precedent about TDIU—chiefly Rice v. Shinseki, 22 Vet.App. 447, 452 (2009)— interacts with the claims system in our new Veterans Appeals Improvement and Modernization Act (AMA) world.”  Id. at *1-2.

The Court determined “that Rice remains viable in AMA but that the different choices created by AMA for seeking review of adverse decisions can make dealing with TDIU more complicated.”  Id. at *2.  And, “reaffirm the central holding of Rice: TDIU is not a separate claim, it is a rating option available whenever a claimant attempts to get service connection or a higher rating from VA and the record includes evidence of unemployability.”  Id. at *2.

The Court explained: “TDIU can come up basically any time VA is rating a disability, VA may need to address it as part of separate claim streams when it is rating different disabilities. Put another way, TDIU is not its own separate benefit that VA can grant or deny unmoored from the underlying service-connection claim or rating. See Harper, 30 Vet.App. at 360; see also Rice, 22 Vet.App. at 454. Instead, TDIU is part of that underlying claim—as an option for a potential rating—and the eventual effective date depends on the specific claim VA is then adjudicating.”  Id. at *9.

However, the Court foreclosed the veterans argument for an earlier effective date stating: “What Mr. Phillips appears to want is for TDIU to be its own unique "super claim." Not a standalone claim when raising the issue, but its own solo claim when figuring out effective dates. The problem is, that's simply not what TDIU is. TDIU is a potential rating for the veteran's disability. If you don't qualify for a 100% rating but you can't work, TDIU may be an option. Thus, the Board needed to, and did, consider TDIU when it rated Mr. Phillips's disabilities. But when the case got to the Board, there was no separate standalone TDIU claim with its own effective date going back to 2002.”  Id. at *11.

The court admitted TDIU was reasonably raised as part of his 2002, 2009 and 2021, but then states “That Mr. Phillips put TDIU in play as part of his other claims but did not receive a decision resolving TDIU for all of them at the same time is a product of the choices built into the AMA system. This choice is a feature, not a bug, of the system. "Central to the AMA's many reforms, claimants may now choose from three procedural lanes to obtain review of their claim within one year of the initial decision (in contrast to the legacy system's single pathway for appeal to the Board)."  Id. at *11.  The Court admitted under the legacy system that TDIU likely would have been in play as of 2002.  Id.  But, then stated: “In the end, that is not the case we have here. We're dealing with the AMA world. In this world, Mr. Phillips's claims stemmed from his April 2021 application. By his own choice, the only disability he brought to the Board was his request for a higher rating for PTSD before April 2021 when he filed an NOD seeking to appeal his PTSD rating effective date and TDIU but not his skin rating. The potential effective date for that increased rating was controlled by his April 2021 application. And one option for that higher rating—and it's the option he ultimately won with— was TDIU. Thus, the potential effective date for TDIU was also controlled by his April 2021 claim.”  Id. at *13.

Chief Judge Bartley wrote a well-reasoned and impassioned dissent.  She noting “the majority's take on TDIU post-AMA would require veterans to appeal rating decisions they actually agree with to protect their earliest effective date for TDIU, clogging an already overstretched VA claims process and harming veterans who may not know to file protective appeals. Therefore, I respectfully dissent.”  Id. at *13.  She essentially argued the majority ignored the intent of Rice, which “that an assertion of unemployability within 1 year of a decision that grants service connection and assigns an initial evaluation abates that decision's finality, potentially affording veterans entitlement to TDIU as part of their initial award of benefits.  In other words, a veteran's potential earliest effective date for TDIU was the date of the claim for service connection, id. at 453, and not, as VA believed prior to Rice, limited to 1 year before the veteran submitted the TDIU application. The Court's holding was to expand VA's prior understanding of TDIU as only being raised when the formal TDIU application was filed—and it was corrective of VA's then-prevalent view that TDIU was unable to be raised by the evidence of record when a veteran filed a claim for service connection.”  Id. at *14.

She then states the majority “turns TDIU into an ordinary individual increased evaluation claim and fails to reckon with TDIU's unique characteristics under the governing regulation, 38 C.F.R. § 4.16. In so doing, the majority limits a claimant’s potential recovery and sanctions a claim prosecution view for TDIU that gives outsize impact to a claimant's inexpert medical and vocational decision about which service-connected disability or disabilities are causing or contributing to unemployability, which evaluation decision to appeal, and which lane to choose.”  Id. at *14-15.  She explained: “But let's be clear: this result is contrary to the Court's intent in Rice and to Congressional intent in creating the AMA system to streamline an already burdened system while maintaining a paternalistic process designed to maximize veterans benefits.”  Id. at *15.  She argues: “the majority does not explain how or why AMA, a process and procedure change, would result in such dramatic substantive entitlement changes when there has been no change to the entitlement requirements of 38 C.F.R. § 4.16, the TDIU regulation.”  Id. She then notes: “This precedent will apply to unemployable veterans who had no warning that they should have appealed each and every initial and increased evaluation decision for every one of their service-connected conditions, irrespective of their agreement with those decisions. As noted earlier, these veterans most likely assumed that since § 4.16 remained untouched by the AMA, its process and procedure changes would not affect TDIU entitlement. Unfortunately, this decision tells these veterans that they were wrong. Five years after AMA's effective date veterans find out, with the issuance of this decision, that the rules of engagement regarding TDIU and TDIU effective dates have changed.”  Id. at *16.

This case is a dramatic sea change in the law that will narrow the availability of TDIU under the AMA system without warning to veterans or advocates.  It will create more appeals and more burden on the VA and complication for advocates who have to tease out claim streams and maintain due to the possibility of TDIU.  I can only hope the advocates who took this case are willing to invest in appealing it to the Federal Circuit.

Decision by Judge Falvey and joined in by Judge Allen.  Dissent by Chief Judge Bartley.  

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Banschbach: Separate Ratings for Paralysis, neuritis, and neuralgia.

Banschbach v. McDonough, Case Number 22-6609, decided July 26, 2024 is a decision by the Veterans Court regarding different and separate nerve ratings.

The veteran is service connected for paralysis of the ilio-inguinal nerve under diagnostic code 8530 as a residual of his in-service hernia repair.  The appeal concerned the Board’s failure to address reasonably raised issues of separate ratings for neuritis of his left ilio-inguinal nerve under diagnostic code 8630 and for neuralgia of his left ilio-inguinal nerve under diagnostic code 8730.  The VA argued the paralysis rating encompassed neuritis and neuralgia symptoms, so separate ratings for all three conditions are prohibited by the rule against pyramiding.

The Court determined “the relevant diagnostic codes should not be read to prohibit separate ratings for paralysis, neuralgia, and neuritis,” and determined as a result that “it is premature to consider what role, if any, the rule against pyramiding may play in this case” because  the record raised the issue.  Id. at *2.

The Court found it “discern[ed] nothing in the rating schedule or related regulations that prohibits consideration of separate ratings for neuritis or neuralgia of a peripheral nerve when a veteran is rated for paralysis of the same nerve under § 4.124a. If VA wishes that to be the case, it has regulatory power at its disposal to enact such a change.”  Id. at *8.

This case has important implications and raises the possibility of multiple ratings for paralysis, neuritis and neuralgia that could lead to real benefits for veterans.

Decision by Judge Toth and joined in by Judges Pietsch and Falvey. 

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De Hart: Scope of An NOD in a Radiculopathy Case and a Reframing of Chavis

De Hart v. McDonough, Case Number 21-6247, decided July 23, 2024 is a decision by the Veterans Court regarding an earlier effective date for radiculopathy.

The claim began related to a noncompensable rating for the veteran spine, during the claim the RO granted a higher rating for the spine and also granted service connection for bilateral lower extremity radiculopathy in a 2019 decision.  The veteran did not file a NOD as to that decision, but the spine rating issue returned to the Board resulting in the Board decision on appeal.

The Board decision noted the grant of service connection for radiculopathy but did not otherwise discuss the award or effective date.  The veteran sought an earlier effective date from the Court and argued “that the issue of an earlier effective date for her right leg radiculopathy was before the Board in 2021 by virtue of the 2009 NOD because, as a neurological complication, radiculopathy must always be considered part and parcel of her spine condition.”  Id. at *1-2.

The Court disagreed and determined: “that once radiculopathy is recognized by VA as a distinct service-connected disability with its own rating criteria, it is subject to the same general rules that would govern the appeal of any other separately adjudicated issue. To that end, we hold that, although neurological complications secondary to a spine condition claim must be considered and properly compensated by VA when they are raised by a veteran or reasonably raised by the record, they do not as a legal matter remain part and parcel of the spine claim once they have been separately addressed and adjudicated in a VA decision. And because the veteran did not file an NOD as to the effective date for right leg radiculopathy assigned by the RO in its 2019 decision, the issue was not before the Board in June 2021, and the Board had no obligation to address it. This result follows naturally from our caselaw, which regards "downstream" issues that have yet to be decided as beyond the scope of an NOD that appeals an "upstream" issue.”  Id. at *2.

Judge Jaquith wrote a powerful and pointed dissent.  He argued the opinion violated the holding found in Chavis v. McDonough, 34 Vet.App. 1 (2021) and the only way to overrule Chavis was an en banc court’s decision.  Id. at *14.  He assailed the majority’s decision to characterize Chavis as factbound, noting its argument really just echoed the dissent in Chavis.  He then asserted: “The circumstances in this case are not meaningfully different from those in Chavis. Though it is true that the Chavismajority left "for another day the question whether issues of higher evaluations for radiculopathy are always part of claims seeking higher evaluations for the underlying spine disability," 34 Vet.App. at 15 n. 17, that footnote does not render the Chavis opinion nonprecedential and is not a license to reverse it in the nearly identical circumstances here. And that is what is happening. Under the guise of addressing an unanswered question, the majority opinion is nullifying the Chavis holding and elevating the Chavis dissent. If that flip-flop is warranted, it must be accomplished by the en banc Court.”  Id. at *15.

I would expect to see a motion to reconsider and find Judge Jaquith's dissent a powerful indictment against a decision that seems to simply change the result of a precedential decision. 

Decision by Judge Toth and joined in by Judge Pietsch.  Dissent by Judge Jaquith. 

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Bolds: Secretary Waiver Allows for New Evidence on Remand

Bolds v. McDonough, Case Number 22-2484, decided July 11, 2024 concerns what happens a case is remanded from the Court to the Board and the remand language allows for new evidence. 

The AMA allows for Board review under three options, this case involves where the veteran sought the hearing docket which allows for new evidence at the hearing or within 90 days after the hearing.  The case was appealed and a joint motion for remand was agreed to by the parties.  In the JMR the parties agreed the veteran can submit additional evidence on remand.

On remand, the Board then rejected the claim and rejected medical records the veteran had submitted to the Board on remand.  The Court noted the limitations of presenting new evidence but found those limits “are claims processing rules that may be waived by the Secretary” and that they were waived.

This decision is an artifact from the transition to AMA and will likely have limited impact.

Decision by Chief Judge Bartley and joined by Judges Pietsch and Greenberg.

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Cardoza: NOD Rejection is Appealable

Cardoza v. McDonough, Case Number 20-6380, decided July 10, 2024 concerns whether a Board letter refusing to accept an NOD was a final order. 

A June 2019 RO decision granted service connection for PTSD and granted a 50% rating and June 2018 effective date.

The veteran filed an HLR as to the rating and a NOD as to the effective date.  A month later, the VA informed the veteran the Board received the NOD, but because of the HLR request the Board could not review the case because “You can only choose one review option for each issue.”

Subsequently the HLR was denied and the veteran filed a notice of appeal from the Board letter.  The Secretary moved to dismiss saying there was no final Board decision.

The veteran argued the Board letter “is an adverse final decision of the Board over which the Court can exercise jurisdiction under 38 U.S.C. § 7266.”

The Court held “that it has jurisdiction to consider this appeal and that the May 19, 2020, letter is a final decision of the Board because in the letter the Board denied the appellant entitlement to the relief sought. See 38 U.S.C. § 7104(d). By refusing to docket the appellant's April 2020 VA Form 10182 in which the appellant sought an earlier effective date for service connection for a psychiatric condition, the Board denied an earlier effective date; this action has the same procedural impact as a dismissal of the appeal, rendering the effective date assigned in the June 2019 rating decision final.”  Id. at *4.  It Court noted: “The May 2020 letter satisfies the requirements of section 7104(d) because the letter (1) is in writing; (2) contains the Board's finding and conclusion, i.e., that the Board could not process the appellant's appeal; (3) contains a statement of reasons or bases explaining that the appellant can choose only one review option per issue; and (4) denied an earlier effective date by refusing to docket his appeal. What's more, Mr. Arnold—the Vice Chairman of the Board and a Board member himself—inspected appellant's VA Form 10182 within the procedural context—meaning that Mr. Arnold assessed the facts and then concluded that the Board could not review appellant's case. So Mr. Arnold provided a legal conclusion. He adjudicated whether the Board had jurisdiction and, through his dismissal, decided a legal question.”  Id. at *3-4.

The order took aim at the dissent by Judge Falvey noting it is incorrect and that its offer of a possible writ of mandamus is no option at all.  It appears the dissent focuses too narrowly on whether a benefit is granted or denied and comes to the conclusion that rejecting a NOD is not a denial.  Ultimately, the dissent seems to object to the idea of “splitting” a claim in terms of separating the issues of effective date and rating.

Decision by Judge Greenberg and joined by Judge Laurer.  Dissent by Judge Falvey.

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