Moody: How to Combined Ratings to Determine Entitlement to Schedular

Moody v. Wilkie, Opinion No. 16-1707, decided November 8, 2018 relies heavily on Gazelle v. Shulkin, 868 F.3d 1006 (Fed. Cir. 2017) to discuss how ratings are combined to determine entitlement to scheduler TDIU and determine that the VA’s combined ratings table is used.

The Court explained:

Under § 4.16(a), the Board may award schedular TDIU in the first instance when a veteran meets specified rating criteria, such as having a single service-connected disability rated 60% or higher. This regulation also provides that certain kinds of disabilities—for example, those originating from the same event—"will be considered as one disability." 38 C.F.R. § 4.16(a) (2018). The issue here is whether the quoted language directs the method by which multiple disability ratings are aggregated to determine whether a claimant exceeds the 60% threshold necessary to claim schedular TDIU.

We conclude that § 4.16(a) unambiguously requires VA to use its combined ratings table when aggregating disabilities for the purpose of considering them "as one disability" and that the Board, therefore, correctly concluded that it could not consider schedular TDIU at that time.

Id. at *1-2.

It this case, the Board determined the veteran’s disabilities shared a common origin and should be deemed a single disability for TDIU purposes.  Specifically, they involved a 40% lumbar disability and two 10% disabilities for the sciatic nerve.  Using the combined rating table, these would add up to a 50% rating whereas simply adding them would result in a 60% rating.  The Board used the combined rating table and determined the veteran did not qualify for scheduler TDIU.  Id. at *5.  On appeal, the veteran argued the combined rating table should not be used and if added, he would qualify for scheduler TDIU.  This was particularly important as the Board actually determined the veteran was unemployable due to his service connected disabilities.

The Court focused on a statutory interpretation of the term in 4.16(a) “will be considered as one disability” for scheduler TDIU purposes.  The Court noted the language of the specific regulation does not identify the method by which disabilities are to be combined or aggregated into one disability.  Id. at *8.  However, the Court then looked at the overall regulatory scheme and was informed by the Gazelle decision.  Gazelle involved the special monthly compensation (SMC) statute and there the Federal Circuit determined the regulation did not identify the method on how to rate multiple disabilities and instead turned to the overall scheme relevant to SMC.  The Federal Circuit said the only method of rating multiple disabilities was to use the combine ratings table.  In this case, the Court concluded:

A similar analysis here leads to the same conclusion. As already noted, the phrase "will be considered as one disability" initially appeared in a 1941 promulgation from VA and has remained unaltered through the current version of § 4.16(a). Yet, the combined ratings table has an even earlier origin. In 1917, Congress instructed VA to set up a schedule for evaluating reductions in earning capacity resulting from "injuries or combinations of injuries," and the agency responded with the first combined ratings table in 1925. Gazelle II, 868 F.3d at 1011. Since then, a combined ratings table has been continuously reauthorized by Congress and employed by VA to aggregate multiple service-connected disabilities. Thus, in the regulatory context in which VA first used the phrase "will be considered as one disability," the combined ratings table was plainly and unambiguously the only method for combining disabilities to determine whether they qualified as one 60% or one 40% disability for schedular TDIU purposes.

Id. at *9 (internal citations omitted).

The Court addressed the veteran’s arguments, principally that (1) Gazelle concerned with a statute as opposed to a regulation and (2) the combined ratings table is only relevant to aggregating service connected disabilities when calculating the amount of compensation to be paid.  Id. at *9.  The Court thought the first argument was a difference without distinction.  Regarding the second, it determined the combined rating table is

meant to capture the dynamic where additional disabilities accrue in a person already functioning at less than 100% earning capacity.  In such circumstances, the sum is not simply the combination of each isolated part, as if those parts presented themselves alone in a person of otherwise optimal ability.  Rather, each additional disability further limits the earning capacity of a person already functioning at less than 100% by virtue of other disabilities. Once the reasoning behind the approach of the combined ratings table is understood, it is clear why simply adding multiple disability ratings in any VA context—not simply when calculating VA compensation payments—would likely overstate a

veteran's actual disability level and could even result in disability assessments greater than 100%.

Id. at *10 (emphasis added).

However, it appears there was evidence of a higher sciatic rating that might push the veteran over the 60% required rating and the Board committed a reasons and bases error by not addressing it and that there was evidence the service connected disabilities might cause or aggravate the veteran’s depression and the Board should have considered whether a medical opinion was necessary to answer the question.  Id. at *11-14.  Therefore, the Court remanded the case to the Board.

The panel included Judges Schoelen, Pietsch, and Toth and the opinion was by signed per curiam.  However, Judges Pietsch and Toth wrote concurrences and dissents.  Judge Pietsch agreed with the reasoning regarding the use of the combined ratings table, but thought the remand essentially mooted the need to discuss this issue and it was perhaps not the best use of judicial resources to render the opinion. 

Judge Toth wrote to state he agreed with the discussion regarding the use of the combined ratings table, but that the reasoning regarding the possible need for a medical examination for depression was incorrect.  He argued the Board’s findings are reviewed under a clear error standard but that the Court essentially conducted its own review of the record.  He focused on the majority view that the general lay statements made to a medical practitioner were enough to require a full discussion by the Board, but believes the Board addressed them plausibly and there was nothing to determine its conclusion was clearly erroneous.  Judge Toth is clearly arguing for more practical deference to the factual findings of the Board. 

This is an issue that has been in play for years and now appears to be settled.  The result in Gazelle probably made this foreordained and I do not believe review by the Federal Circuit will result in any change.

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