[Federal Register Volume 71, Number 173 (Thursday, September 7, 2006)]
[Rules and Regulations]
[Pages 52744-52747]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E6-14835]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 3

RIN 2900-AI42


Claims Based on Aggravation of a Nonservice-Connected Disability

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is amending its 
adjudication regulations concerning secondary service connection. This 
amendment is necessary because of a court decision that clarified the 
circumstances under which a veteran may be compensated for an increase 
in the severity of an otherwise nonservice-connected condition which is 
caused by aggravation from a service-connected condition. The intended 
effect of this amendment is to conform VA regulations to the court's 
decision.

DATES: Effective Date: October 10, 2006.

FOR FURTHER INFORMATION CONTACT: Bill Russo, Chief, Regulations Staff, 
Compensation and Pension Service, Department of Veterans Affairs, 810 
Vermont Avenue, NW., Washington, DC 20420, (202) 273-7211.

SUPPLEMENTARY INFORMATION: VA published in the Federal Register (62 FR 
30547) a proposed rule to amend 38 CFR 3.310 by adding a new paragraph 
to implement a decision of the United States Court of Veterans Appeals 
(now the United States Court of Appeals for Veterans Claims) (CAVC) in 
the case of Allen v. Brown, 7 Vet. App. 439 (1995), that provided for 
establishing service connection for that amount of increase in an 
otherwise nonservice-connected condition which was caused by 
aggravation from a service-connected condition (Allen aggravation). We 
received comments from the Disabled American Veterans and the Vietnam 
Veterans of America, Inc. Based on the rationale set forth in the 
proposed rule and in this document, we are adopting the provisions of 
the proposed rule as a final rule with the changes indicated below.
    One commenter expressed the opinion that VA should establish 
service connection for the entire aggravated injury or disease, but 
only pay compensation for that part of the condition that is due to 
aggravation by an already service-connected condition. The commenter 
opined that 38 U.S.C. 1110 and 1131 do not allow VA to establish 
service connection for part of a condition. The same commenter stated 
that it has been the policy of VA to compensate the entire disability 
where a service-connected condition and a nonservice-connected 
condition affect a single organ, body system, or function, and the two 
conditions have common symptoms that cannot be separated. This 
commenter felt that the policy was an acknowledgment by VA that the 
symptoms cannot be separated to allow proportioning the disability 
attributable to each organ, body system, or function. We do not agree 
with this proposed amendment to the rule.
    In Allen v. Brown, 7 Vet. App. 439 (1995), the CAVC held that 38 
U.S.C. 1110 requires VA to pay compensation for the aggravation of the 
nonservice-connected disability but did not, we believe, express a 
specific view on whether VA would be required or permitted to grant 
``service connection'' for all or only part of the nonservice-connected 
disease. Section 1110 does not directly speak to awards of ``service 
connection,'' but merely authorizes compensation for ``disability,'' 
which the CAVC in Allen construed to mean ``impairment of earning 
capacity.'' Section 1110 further requires that the disability have been 
caused by an injury or disease incurred or aggravated in service. This 
is consistent with the proposed rule, which requires that the 
``disability'' (the increased severity of the nonservice-connected 
condition) must be caused by a service-connected injury or disease. 
Accordingly, section 1110 does not support the commenter's position. In 
its holding in Tobin v. Derwinski, 2 Vet. App. 34 (1991), the CAVC 
apparently interpreted 38 CFR 3.310 to require VA to grant ``service 
connection'' for the portion of the nonservice-connected disability 
attributable to aggravation by the service-connected condition. Thus, 
when read in tandem, the CAVC's rulings require VA to service connect 
the degree of aggravation of a nonservice-connected condition by a 
service-connected disability and to pay compensation for that level of 
disability attributable to such aggravation. Although Sec.  3.310 
reasonably provides that any disability proximately caused by a 
service-connected disease will be considered part of the service-
connected condition, for purposes of authorizing service connection and 
compensation, there is no clear basis for awarding service connection 
for the entire nonservice-connected condition, including aspects of 
that condition that are not attributable to a service-connected 
condition.
    Although 38 U.S.C. 1110 neither uses nor defines the term 
``service-connected,'' that term is defined in 38 U.S.C. 101(16) to 
mean, in pertinent part, that a ``disability was incurred or aggravated 
* * * in line of duty in the active military, naval, or air service.'' 
Nothing in that definition requires or authorizes VA to grant service 
connection for the entirety of a disease or injury that was not 
incurred or aggravated in service.
    Both commenters expressed concerns about the difficulties in 
establishing the degree of aggravation that is to be compensated. 
However, VA believes that, if medical evidence is adequately developed, 
computation of the degree of aggravation should be attainable. The 
degree of aggravation would be assessed based upon the objective 
medical evidence of record.
    Both commenters objected to the proposed rule's requirement of 
``medical evidence extant before the aggravation sufficient to 
establish the pre-aggravation severity of the disability.'' They 
suggested that a current medical opinion should be sufficient to 
establish the fact of aggravation.
    Aggravation is a comparative term meaning that a disability has 
worsened from one level of severity to another. In order to establish 
the degree to which aggravation has occurred, it is necessary to 
compare the current level of severity to a prior level of severity. In 
cases of disabilities which pre-existed service, in standard 
aggravation claims under 38 U.S.C. 1153, the pre-service level of 
severity is generally established by a service entrance examination. If 
no disabilities are noted on that examination, the veteran is presumed 
to have been in sound condition when he or she entered service. If 
disabilities are noted on the entrance examination, the examiner should 
include sufficient findings to permit a determination of the degree of 
disability. If the findings indicate severe disability, the person 
would not be allowed on active duty. If the findings indicate mild to 
moderate disability, an assessment of fitness for duty would be made. 
If the person were allowed on active duty, there should be sufficient 
findings for a later assessment of the pre-service level of disability, 
which would be deducted from the post-service level of disability in a

[[Page 52745]]

standard aggravation claim. It is the Government's responsibility to 
conduct the entrance examination and to create and maintain a record of 
that examination. If the Government fails to conduct the examination or 
fails to provide sufficient findings for assessing the level of pre-
service disability, or if the record of the examination is lost or 
destroyed, that should not operate to the disadvantage of the veteran. 
That is the reason for the language in 38 CFR 3.322 and 4.22, which 
requires deduction of the pre-service level of disability from the 
current level of disability only if the pre-service level of disability 
is ``ascertainable.''
    The requirement for proof of baseline disability is much different 
in an Allen aggravation case. The threshold requirement for entitlement 
under Sec.  3.310(a) is evidence demonstrating an increase in 
disability of a nonservice-connected disability that is proximately due 
to or the result of service. Thus, evidence of baseline disability is 
first necessary to establish entitlement to service connection. Plainly 
stated, such evidence of aggravation would necessarily include some 
demonstration of baseline disability in order to show an increase in 
severity. Once entitlement has been established, such evidence would 
also be necessary for purposes of determining the level of 
compensation. In so doing, the veteran would demonstrate that the 
nonservice-connected disability has increased in severity because of 
aggravation from a service-connected condition. Unlike the standard 
aggravation claim pursuant to 38 U.S.C. 1153 where the baseline level 
of severity (referred to in the text of the proposed rule as ``the pre-
aggravation severity'') is based on an entrance examination, there is 
no Government responsibility to create and maintain medical records on 
nonservice-connected conditions for purposes of determining the 
baseline level of severity in Allen aggravation claims. The veteran 
must ``support'' the claim with medical evidence of the baseline level 
of severity of a nonservice-connected condition which can then be 
compared to the current level of severity to establish the fact of 
aggravation and the degree of disability for which the veteran will be 
compensated.
    One commenter stated it would be unreasonable for VA to require 
proof of a baseline level of disability as a condition for granting 
service connection for aggravation. To illustrate, the commenter 
suggested that if a physician opined that a service-connected condition 
aggravated a nonservice-connected condition, VA would be required to 
concede aggravation, in the absence of any contrary evidence, even if 
there were no evidence of a baseline level of pre-aggravation 
disability.
    This comment is premised upon the incorrect assumption that there 
is necessarily a difference under Allen between the issue of service 
connection and the degree of disability. As indicated, the evidence of 
baseline disability satisfies the initial requirement of additional 
disability necessary to establish entitlement, but also is necessary to 
demonstrate the level of disability due to aggravation. Because we 
cannot service connect the entire nonservice-connected condition, only 
the degree of disability resulting from aggravation may be service 
connected. Therefore, evidence concerning the degree of disability is 
essential to establish service connection in Allen aggravation claims 
and it is reasonable for VA to require claimant's to submit proof of a 
baseline disability level. Such a requirement is in accordance with 
VA's authority under 38 U.S.C. 501 to specify the types of proof that 
are necessary to establish a benefit.
    Finally, in the example suggested by the commenter, if a physician 
determines that a service-connected condition has aggravated a 
nonservice-connected condition, it is reasonable to expect that that 
medical opinion would be based on evidence of the baseline and the 
current level of disability of the nonservice-connected condition. 
Thus, the requirement to provide proof of a baseline level of 
disability is not as onerous as contemplated and suggested by this 
commenter.
    We have, however, reconsidered the requirement of ``medical 
evidence extant before the aggravation'' to establish the baseline 
level of severity when computing the degree of aggravation. It could be 
difficult for some claimants to identify the date of onset of the 
aggravation and then to locate medical evidence created before that 
date to establish the baseline. Thus, limiting the medical evidence for 
baseline calculation to that which existed prior to the onset of 
aggravation could likely result in unfavorable decisions in several 
claims. Obviously, if such records were available, they would establish 
the lowest baseline level of severity and, hence, the greatest degree 
of aggravation when compared to the current level of severity. However, 
since aggravation is generally an ongoing process, medical evidence 
establishing the aggravation could be created at any time between the 
onset of aggravation and the date of the current claim. VA's acceptance 
of medical evidence created at any time between the onset of 
aggravation and the date of the current claim for purposes of 
establishing the baseline level of severity would be more favorable to 
claimants, although claims granted in this regard would likely result 
in findings of smaller degrees of aggravation and less compensation. We 
are, therefore, amending the proposed rule to allow the acceptance, for 
baseline purposes, of medical evidence created at any time between the 
onset of aggravation and the receipt of medical evidence establishing 
the current level of severity. The earlier medical evidence will 
establish the baseline level of severity for comparison with the 
current level of severity to determine the degree of aggravation that 
may be service-connected and compensated. For example, if the onset of 
aggravation was sometime in 1996, but the veteran can only produce 
medical evidence from 1999, the 1999 medical evidence would be accepted 
for purposes of establishing the baseline level of severity. The rule 
will also state that VA will also accept, for baseline purposes, 
medical evidence created before the onset of aggravation.
    One commenter suggested that the provisions of 38 CFR 3.322 with 
regard to in-service aggravation of pre-service disabilities should 
have equal application in Allen aggravation claims. Specifically, Sec.  
3.322 provides that no deduction for the pre-service level of 
disability may be made unless that pre-service level is 
``ascertainable.'' It also provides that no deduction is to be made if 
the aggravated disability becomes totally disabling. We do not agree 
with this suggestion. As mentioned earlier, when a pre-service level of 
disability is not ascertainable, the Government has failed to discharge 
its responsibility to conduct, and/or maintain a record of, an adequate 
entrance examination. That failure should not be allowed to 
disadvantage the veteran in any way. In Allen aggravation claims the 
Government has no such responsibility. The responsibility for 
establishing a baseline level of disability in such claims rests with 
the veteran. If no baseline can be established, no aggravation can be 
demonstrated, and the deduction issue would be moot.
    With respect to the provision concerning no deduction when the 
aggravated disability is totally disabling, we believe such action is 
prohibited by the Allen decision itself. There the Court stated with 
parenthetical emphasis that ``such veteran shall be compensated for the 
degree of disability (but only that degree) over and above the degree 
of disability existing prior to

[[Page 52746]]

the aggravation.'' Based on that language it is clear that only the 
incremental increase in disability is to be compensated. To hold 
otherwise could lead to absurd results. For example, if, 20 years after 
service, a Vietnam veteran developed a nonservice-connected psychosis 
which was 70 percent disabling but also had a service-connected 
disability that aggravated the psychosis causing it to be totally 
disabling, then the application of 38 CFR 3.322 would require payment 
of compensation at the 100 percent rate for a 70 percent nonservice-
connected condition, when the aggravated percentage is 30 percent. Such 
a result could not have been intended by the Allen court, and we 
decline to apply Sec.  3.322 to Allen aggravation claims in the manner 
suggested.
    Both commenters suggested that it would be difficult, if not 
impossible, for VA to determine, for deduction purposes, the degree of 
increase in a nonservice-connected condition that is attributable to 
``the normal progression of the disability'' and that perhaps that 
provision in the proposed rule should just be deleted on the basis of 
workload considerations. While we agree that it could be difficult to 
establish the degree of increased disability due to ``normal 
progression,'' that does not relieve VA of the responsibility to 
consider such evidence if it exists. In Allen aggravation claims VA can 
only pay compensation for the increased disability attributable to 
aggravation from a service-connected condition. Any increase 
attributable to other causes is beyond the scope of Allen and may not 
be compensated unless specifically authorized by statute. While 
authoritative medical evidence on the degree of increase due to 
``normal progression'' of a disease is rare, if it exists in an 
individual case, VA cannot ignore it and cannot adopt the suggestion to 
delete this provision in the proposed rule.
    However, in analyzing and responding to the above suggestion, we 
noted that the proposed rule uses language different from that found in 
38 U.S.C. 1153 and 38 CFR 3.306. The proposed rule uses the phrase 
``normal progression of the disability'' whereas the cited statute and 
regulation dealing with aggravation use the phrase ``natural progress 
of the disease.'' Although the choice of words in the proposed rule is 
slightly different from the statutory phrasing, no change in meaning 
was intended. For purposes of clarity, however, we will incorporate the 
statutory phrasing in the first and last sentences of 3.310(b). The 
proposed rule also uses the term ``disability'' to mean ``disease or 
injury'', in four other instances. The term ``disability'' is used in 
38 U.S.C. 1153 and 38 CFR 3.306 to mean the level of disability, rather 
than the disease or injury itself. To avoid any possible confusion 
about our intent (to refer to the disease or injury), we believe it 
will provide greater clarity to use the term ``disease or injury'' 
instead of disability in 3.310(b). We are also changing ``rather than'' 
to ``and not due to'' to provide a more parallel structure for the 
first sentence of 3.310(b).
    One commenter urged VA to include in this regulation some 
directions to field personnel on how to evaluate the ``natural 
progress'' of a disease including the effects of such variables as 
race, age, gender and geographic location on such ``progress.'' The 
commenter also opined that VA was incapable of providing adequate 
directions on this subject.
    We do not believe that special instructions for evaluating 
``natural progress'' are necessary. Any evidence of ``natural 
progress'' of a disease would be in the form of medical evidence. Since 
our field personnel are already charged with assessing the credibility 
and weight of such evidence with regard to other issues in a claim, it 
would not be appropriate to have a separate set of instructions for 
assessing the credibility and weight of medical evidence relating to 
``natural progress'' of a disease. The variables mentioned by the 
commenter would be considered by the medical professional who was 
providing the evidence of ``natural progress.'' Therefore, no changes 
in the proposed rule are warranted based on this comment.
    One commenter noted that VA has taken a pro-veteran approach to 
allowing a veteran to claim the aggregate disability caused by a 
service-connected and nonservice-connected condition, demonstrated by 
Sec.  4.127, which provides that a veteran with a mental retardation or 
a personality disorder may also have a mental disorder that may be 
service-connected. Section 4.127 states that a veteran may have co-
existing mental disorders, one service-connectable and the other 
congenital or developmental, and that the service-connectable disorder 
should not be overlooked because of the congenital or developmental 
disorder. Nothing in Sec.  4.127 provides for granting service 
connection for the co-existing mental retardation or personality 
disorder.
    While VA will compensate overlapping symptoms as if the overlapping 
symptoms were all due to the effects of the service-connected 
condition, we do this in specific situations where it is impossible for 
a medical examiner to distinguish which symptoms are due to the 
service-connected disability and which are due to the nonservice-
connected disability, such as where two separate disabilities share 
common symptoms. Where various symptoms affecting a single body part or 
system can be separated into those attributable to the service-
connected disability and those attributable to the nonservice-connected 
disability, VA evaluates for compensation only those symptoms 
attributable to the service-connected disability.
    While VA agrees that the provision referred to by the commenter is 
pro-veteran, it does not stand for the proposition that VA grants 
service connection for conditions not related to military service. No 
changes are warranted based on this comment.
    One commenter also referenced the principle codified in 38 U.S.C. 
1160 and 38 CFR 3.383, which provide for special consideration when a 
specified degree of disability is service-connected in certain organs 
or extremities and there is a nonservice-connected disability affecting 
the corresponding paired organ or extremity. In this situation, VA is 
authorized to pay disability compensation as if the combination of 
disabilities in those paired organs or extremities were service-
connected. The commenter expressed the opinion that this demonstrates 
that VA will grant service connection for a nonservice-connected 
disability.
    Section 3.383 does not authorize a grant of service connection for 
the disability affecting the nonservice-connected paired organ or 
extremity. Rather, the disability of the nonservice-connected paired 
organ or extremity remains nonservice-connected but is compensated as 
if it was service-connected. Further, section 3.383 merely reiterates 
statutory provisions in 38 U.S.C. 1160 and in no way suggests that VA 
has general authority to grant service connection for nonservice-
connected conditions. Thus, this comment is not directly relevant to 
the subject of the proposed rule. We make no changes based on this 
comment.
    One commenter opined that the determinations of the level of 
disability must be made by medical personnel and not Rating Veterans 
Service Representatives. This commenter urged VA to include in the 
Adjudication Manual a provision stating this.
    We make no changes based on this suggestion. While the Adjudication 
Manual may need to be amended to reflect the procedures necessary to 
implement this regulatory change, the

[[Page 52747]]

suggestion itself is beyond the scope of this rulemaking.
    Based on our review of the proposed amendment, we are making a 
minor change in wording. In the first sentence of new paragraph (b), we 
are changing ``shall'' to ``will'' to reflect VA's current efforts to 
write regulations in plain language.

Executive Order 12866

    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity). The Order 
classifies a rule as a significant regulatory action requiring review 
by the Office of Management and Budget if it meets any one of a number 
of specified conditions, including: Having an annual effect on the 
economy of $100 million or more, creating a serious inconsistency or 
interfering with an action of another agency, materially altering the 
budgetary impact of entitlements or the rights of entitlement 
recipients, or raising novel legal or policy issues. VA has examined 
the economic, legal, and policy implications of this final rule and has 
concluded that it is a significant regulatory action under Executive 
Order 12866 because it materially alters the rights of entitlement 
recipients based upon a court decision.

Paperwork Reduction Act

    This document contains no provisions constituting a collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3521).

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in an expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector of $100 million or more (adjusted annually for 
inflation) in any given year. This rule would have no such effect on 
State, local, and tribal governments, or on the private sector.

Regulatory Flexibility Act

    The Secretary hereby certifies that this regulatory amendment will 
not have a significant economic impact on a substantial number of small 
entities as they are defined in the Regulatory Flexibility Act, 5 
U.S.C. 601-612. The reason for this certification is that these 
amendments would not directly affect any small entities. Only VA 
beneficiaries and their survivors could be directly affected. 
Therefore, pursuant to 5 U.S.C. 605(b), these amendments are exempt 
from the initial and final regulatory flexibility analysis requirements 
of sections 603 and 604.

Catalog of Federal Domestic Assistance

    The Catalog of Federal Domestic Assistance program numbers are 
64.109, Veterans Compensation for Service-Connected Disability, and 
64.110, Veterans Dependency and Indemnity Compensation for Service-
Connected Death.

List of Subjects in 38 CFR Part 3

    Administrative practice and procedure, Claims, Disability benefits, 
Health care, Pensions, Radioactive materials, Veterans, Vietnam.

    Approved: May 26, 2006.
Gordon H. Mansfield,
Deputy Secretary of Veterans Affairs.

    Editorial Note: This document was received at the Office of the 
Federal Register on September 1, 2006.


0
For the reasons set forth in the preamble, VA is amending 38 CFR part 3 
as set forth below:

PART 3--ADJUDICATION

Subpart A--Pension, Compensation, and Dependency and Indemnity 
Compensation

0
1. The authority citation for part 3, subpart A, continues to read as 
follows:

    Authority: 38 U.S.C. 501(a), unless otherwise noted.


0
2. Section 3.310 is amended by revising the section heading; by 
redesignating paragraph (b) as paragraph (c); and by adding a new 
paragraph (b) to read as follows:


Sec.  3.310  Disabilities that are proximately due to, or aggravated 
by, service-connected disease or injury.

* * * * *
    (b) Aggravation of nonservice-connected disabilities. Any increase 
in severity of a nonservice-connected disease or injury that is 
proximately due to or the result of a service-connected disease or 
injury, and not due to the natural progress of the nonservice-connected 
disease, will be service connected. However, VA will not concede that a 
nonservice-connected disease or injury was aggravated by a service-
connected disease or injury unless the baseline level of severity of 
the nonservice-connected disease or injury is established by medical 
evidence created before the onset of aggravation or by the earliest 
medical evidence created at any time between the onset of aggravation 
and the receipt of medical evidence establishing the current level of 
severity of the nonservice-connected disease or injury. The rating 
activity will determine the baseline and current levels of severity 
under the Schedule for Rating Disabilities (38 CFR part 4) and 
determine the extent of aggravation by deducting the baseline level of 
severity, as well as any increase in severity due to the natural 
progress of the disease, from the current level.

(Authority: 38 U.S.C. 1110 and 1131)
* * * * *
 [FR Doc. E6-14835 Filed 9-6-06; 8:45 am]
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