[Federal Register Volume 87, Number 182 (Wednesday, September 21, 2022)]
[Rules and Regulations]
[Pages 57602-57609]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2022-20271]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 71

RIN 2900-AR28


Extension of Program of Comprehensive Assistance for Family 
Caregivers Eligibility for Legacy Participants and Legacy Applicants

AGENCY: Department of Veterans Affairs.

ACTION: Interim final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is amending its 
regulations that govern VA's Program of Comprehensive Assistance for 
Family Caregivers (PCAFC) by extending eligibility for legacy 
participants, legacy applicants and their Family Caregivers, and the 
applicable benefits afforded to such Family Caregivers, to include the 
monthly stipend, by three years. VA is also making non-substantive 
technical amendments to the regulations.

DATES: 
    Effective date: This interim final rule is effective September 21, 
2022.
    Comment date: Comments must be received on or before November 21, 
2022.

ADDRESSES: Comments must be submitted through www.Regulations.gov. 
Comments received will be available at regulations.gov for public 
viewing, inspection or copies.

FOR FURTHER INFORMATION CONTACT: Colleen Richardson, PsyD, Executive 
Director, Caregiver Support Program, Patient Care Services, Veterans 
Health Administration, Department of Veterans Affairs, 810 Vermont Ave. 
NW, Washington, DC 20420, (202) 461-7337. (This is not a toll-free 
telephone number.)

SUPPLEMENTARY INFORMATION:

I. Background

    In 2010, section 1720G of title 38 of the United States Code 
(U.S.C.) was codified when it was enacted as part of the Caregivers and 
Veterans Omnibus Health Services Act of 2010. Public Law (Pub. L.) 111-
163, 124 Stat. 1130 (2010). As originally enacted, section 1720G 
required VA, in part, to establish a Program of Comprehensive 
Assistance for Family Caregivers (PCAFC) for Family Caregivers of 
eligible veterans who have a serious injury incurred or aggravated in 
the line of duty in the active military, naval, or air service on or 
after September 11, 2001. VA implemented PCAFC through its regulations 
in part 71 of title 38, Code of Federal Regulations (CFR). PCAFC 
provides certain benefits such as training, respite care, counseling, 
technical support, beneficiary travel (to attend required caregiver 
training and for an eligible veteran's medical appointments), access to 
health care (if qualified) through the Civilian Health and Medical 
Program of the Department of Veterans Affairs (CHAMPVA), and a monthly 
stipend. 38 U.S.C. 1720G; 38 CFR 71.25(d), 71.40.
    In 2018, section 161 of the John S. McCain III, Daniel K. Akaka, 
and Samuel R. Johnson VA Maintaining Internal Systems and Strengthening 
Integrated Outside Networks Act of 2018 (VA MISSION Act of 2018), 
Public Law 115-182, 132 Stat. 1393 (2018), amended 38 U.S.C. 1720G by 
expanding PCAFC to Family Caregivers of eligible veterans who incurred 
or aggravated a serious injury in the line of duty before September 11, 
2001, in a phased approach, establishing new benefits for designated 
Primary Family Caregivers of eligible veterans, and making other 
changes affecting program eligibility and VA's evaluation of PCAFC 
applications. To incorporate these and other necessary changes to 
improve and expand VA's PCAFC, VA amended 38 CFR part 71. 85 Federal 
Register (FR) 46226 (July 31, 2020). These changes took effect on 
October 1, 2020. Id. As part of that rulemaking, VA revised the 
eligibility criteria for PCAFC in Sec.  71.20, identified a legacy 
cohort (i.e., legacy applicants, legacy participants, and their Family 
Caregivers, as those terms are defined in Sec.  71.15) who were 
approved for PCAFC under the previous eligibility criteria, and created 
a one-year transition period whereby the legacy cohort would continue 
to remain eligible for PCAFC while VA reassessed whether the legacy 
cohort would continue to be eligible for PCAFC under the new 
eligibility criteria.
    When VA established the initial one-year transition period for the 
legacy cohort, VA intended to establish a transition plan for legacy 
participants and legacy applicants who may or may not meet the new 
eligibility criteria and whose Primary Family Caregivers could have 
their stipend amount impacted by changes to the stipend payment 
calculation. 85 FR 13356 (March 6, 2020). The one-year period was 
intended to provide a reasonable amount of time for VA to conduct 
reassessments, minimize disruption to those individuals, including 
disruptions that would result from the changes to the stipend payment 
calculation, and provide a fair and reasonable time for transition. 85 
FR 46253. VA intended that all legacy applicants, legacy participants, 
and their Family Caregivers would have the same transition period, 
regardless of when the reassessment was completed during the one-year 
transition period. Id. This transition period was intended to ensure 
equitable treatment for all legacy applicants, legacy participants, and 
their Family Caregivers. Id.
    On September 22, 2021, VA published an interim final rule (First 
PCAFC Extension for Legacy Cohort) which amended 38 CFR part 71, by 
extending the one-year transition period and timeline for VA to conduct 
all necessary reassessments of the legacy cohort for one additional 
year (that is, until September 30, 2022). 86 FR 52614 (September 22, 
2021). A targeted discussion explaining why VA created the legacy 
cohort and the initial one-year transition period is more fully 
described in the First PCAFC Extension for Legacy Cohort, and that 
description is adopted by reference into this preamble. See id. at 
52615.
    On March 25, 2022, the U.S. Court of Appeals for the Federal 
Circuit issued a decision that set aside certain PCAFC criteria that VA 
established as part of the July 31, 2020 rulemaking. Veteran Warriors, 
Inc. v. Sec'y of Veterans Affairs, 29 F.4th 1320 (Fed. Cir. 2022). The 
court's decision applies to cases and claims initiated on or after the 
date of the decision, as well as any PCAFC

[[Page 57603]]

determination still open on direct review before VA as of that date. 
Matters still open on direct review include determinations concerning 
stipend decreases or discharges for the legacy cohort made in the 
course of reassessments completed before March 25, 2022. As a result, 
VA must repeat certain reassessments of the legacy cohort to account 
for the court's interpretation, as explained in more detail below.
    For the reasons explained in the subsequent discussion below, VA is 
extending the transition period and timeline for VA to complete 
reassessments of the legacy cohort by three additional years (that is, 
until September 30, 2025). Accordingly, VA is amending 38 CFR 71.20(b) 
and (c) regarding program eligibility; Sec.  71.30(e) regarding 
reassessments; and Sec.  71.40(c)(4)(i)(B) through (D), 
(c)(4)(ii)(C)(2)(i) and (ii), and the note to (c)(4)(ii)(C)(2) 
regarding the stipend methodology, to account for the additional three-
year period through September 30, 2025.
    Additionally, VA is making technical amendments to correct the 
citation in the definition of ``General Caregiver'' in Sec.  71.15; and 
in Sec. Sec.  71.20(a)(2)(ii) and (iii) and 71.25(a)(3)(ii)(A) and (B), 
VA is making technical amendments to reflect the date VA submitted to 
Congress a certification that VA fully implemented the information 
technology (IT) system required by section 162 of the VA MISSION Act of 
2018 (i.e., October 1, 2020) and the date that is two years after the 
Secretary submitted such certification to Congress (i.e., October 1, 
2022).

II. Extension of Transition Period for Legacy Cohort

    VA published the First PCAFC Extension for Legacy Cohort because VA 
was unable to conduct all reassessments of the legacy cohort within the 
one-year period provided in the July 31, 2020 rulemaking. 86 FR 52616. 
Since the First PCAFC Extension for Legacy Cohort was published, VA has 
made significant progress in completing reassessments of the legacy 
cohort. As stated in the First PCAFC Extension for the Legacy Cohort, 
as of July 1, 2021, VA had only completed four percent of the estimated 
19,800 reassessments needed for the legacy cohort. Id. As of August 3, 
2022, VA has completed approximately 95 percent of the reassessments 
needed for the legacy cohort; \1\ however, as discussed below, the 
outcome of the Veteran Warriors decision has impacted VA's ability to 
rely on certain determinations made during many of the reassessments 
that were completed. Therefore, VA believes an additional three-year 
transition period is necessary while VA completes the remaining 
reassessments and repeats certain reassessments that were completed 
before the Veteran Warriors decision.
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    \1\ Reassessment data provided in this rulemaking come from the 
Caregiver Record Management Application (CARMA) system. CARMA 
provides a snapshot in time, as of the point when the report was 
run. This data is agile due to factors such as delayed data entry 
and data corrections, and therefore this data should be considered 
an estimate.
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A. Veteran Warriors, Inc. v. Sec'y of Veterans Affairs (Veteran 
Warriors)

    In the July 31, 2020 rulemaking, VA added a ``need for supervision, 
protection, or instruction'' as a basis upon which VA could determine 
that a veteran or servicemember is in need of personal care services 
under 38 CFR 71.20(a)(3). VA defined the term, ``need for supervision, 
protection, or instruction,'' to mean ``an individual has a functional 
impairment that directly impacts the individual's ability to maintain 
his or her personal safety on a daily basis.'' 38 CFR 71.15. This term 
and its definition were intended to implement the two criteria in 38 
U.S.C. 1720G(a)(2)(C)(ii) and (iii) (that is, ``a need for supervision 
or protection based on symptoms or residuals of neurological or other 
impairment or injury'' and ``a need for regular or extensive 
instruction or supervision without which the ability of the veteran to 
function in daily life would be seriously impaired'', respectively). 
The term ``need for supervision, protection, or instruction'' is also 
referenced in the definition of ``unable to self-sustain in the 
community'' in 38 CFR 71.15, which is applied for purposes of 
determining the applicable stipend level in Sec.  71.40(c)(4)(i)(A).
    In Veteran Warriors, several parts of the July 31, 2020 rulemaking 
were challenged, including VA's definition of need for supervision, 
protection, or instruction. On March 25, 2022, the U.S. Court of 
Appeals for the Federal Circuit set aside VA's definition of ``need for 
supervision, protection, or instruction'' because it determined that 
the definition was inconsistent with the statutory language. Veteran 
Warriors at 1342-43. The court dismissed or denied the petition for 
review with respect to the other regulatory provisions challenged. 
Thus, none of the other PCAFC criteria or requirements in 38 CFR part 
71 were impacted by the court's decision.
    As a result of the court's decision, effective March 25, 2022, VA 
is required to apply clauses (ii) and (iii) of 38 U.S.C. 1720G(a)(2)(C) 
in place of the regulatory definition at 38 CFR 71.15 when making 
determinations under the PCAFC regulations that became effective on 
October 1, 2020. Further, in addition to cases and claims initiated on 
or after March 25, 2022, the judicial interpretation in Veteran 
Warriors also applies to any PCAFC determination (e.g., claim, case, 
appeal) ``still open on direct review'' before VA as of March 25, 2022, 
in any future decision that will be issued as part of that direct 
review. See George v. McDonough, 142 S. Ct. 1953, 1962 (2022) (citing 
the general rule from Harper v. Virginia Dept. of Taxation, 509 U.S. 
86, 97 (1993) that the new interpretation of a statute can only 
retroactively affect decisions still open on direct review).
    In general, new judicial interpretations apply to cases pending 
when the judicial interpretation is issued, but do not provide a basis 
to reopen final decisions. See generally Jordan v. Nicholson, 401 F.3d 
1296, 1298-99 (Fed. Cir. 2005) (citing Reynoldsville Casket Co. v. 
Hyde, 514 U.S. 749, 752 (1995) as an example of the United States 
Supreme Court denying an attempt to reopen a final decision); Disabled 
Am. Veterans v. Gober, 234 F.3d 682, 698 (Fed. Cir. 2000) (citing 
Harper, 509 U.S. at 97 (1993), in stating that ``new interpretation of 
a statute can only retroactively effect decisions still open on direct 
review, not those decision[s] that are final''); Rivers v. Roadway 
Express, 511 U.S. 298, 311-13 (1994) (discussing retroactive 
application of statutes). In general, cases are pending when no 
decision containing language ``from which a claimant could deduce that 
the claim was adjudicated'' has been issued. Ingram v. Nicholson, 21 
Vet. App. 232, 243 (2007).
    In the context of PCAFC, VA interprets ``still open on direct 
review'' to mean that, as of March 25, 2022, VA had not issued the last 
notice of decision that it intends to issue or provide the claimant on 
a PCAFC determination. This includes decisions pertaining to joint 
applications, reassessments, discharges, revocations, and stipend 
changes. Matters ``still open on direct review'' also encompass 
determinations for which VA had, as of March 25, 2022, issued advanced 
notice of its findings, but not ``final notice'' as that term is used 
in 38 CFR 71.40(c)(4)(ii)(C)(1)(ii) and (c)(4)(ii)(C)(2)(ii) and 
71.45(b)(1)(ii)(A). Under those provisions, VA provides a 60-day 
advanced notice period before

[[Page 57604]]

issuing a final notice in the case of a stipend decrease based on a 
reassessment or a discharge based on the eligible veteran not meeting 
the eligibility criteria in Sec.  71.20(a)(1) through (4). As a result, 
for those determinations involving the ``need for supervision, 
protection, or instruction'' definition that were still pending 
issuance of a last notice of decision on March 25, 2022, VA must re-
evaluate such determinations based on the Veteran Warriors decision, as 
such determinations are considered ``still open on direct review.''
    For the legacy cohort, the 60-day advanced notice period for 
stipend decreases under Sec.  71.40(c)(4)(ii)(C)(2)(ii) and discharges 
under Sec.  71.45(b)(1)(i)(A) (because the eligible veteran does not 
meet the requirements of Sec.  71.20) cannot begin until October 1, 
2022, by regulation, and thus, could not have been issued before March 
25, 2022. Prior to March 25, 2022, when a reassessment of a member of 
the legacy cohort under Sec.  71.30(e) resulted in a decision to 
decrease the stipend or discharge the individual, VA provided such 
preliminary findings to the individual, with the intent of adopting 
those findings in its advanced notice of findings to be provided on 
October 1, 2022. However, because final notice of VA's decision 
regarding stipend decreases or discharges for the legacy cohort cannot 
be issued before 60 days after October 1, 2022, those cases or claims 
are ``still open on direct review'' by VA. Moreover, because VA's 
preliminary findings regarding stipend decreases and discharges made in 
the course of reassessments under Sec.  71.30(e) for the legacy cohort 
were based, at least in part, on VA's definition for need for 
supervision, protection, or instruction that was invalidated by the 
decision in Veteran Warriors, VA can no longer rely on those 
preliminary findings.
    In contrast, for any PCAFC decision in which VA had issued a final 
decision notice before March 25, 2022, VA is not required to 
proactively reopen the matter and adjudicate the decision again in 
accordance with Veteran Warriors. See Jordan, 401 F.3d at 1298-99; 
Disabled Am. Veterans, 234 F.3d at 698; Rivers, 511 U.S. at 311-13. 
Such decisions include those in which members of the legacy cohort 
received notice of a decision that was favorable before March 25, 2022 
(i.e., a reassessment that resulted in a determination of continued 
eligibility for PCAFC under 38 CFR 71.20(a) with the same monthly 
stipend payment or an increased monthly stipend payment). Upon making 
such determinations, VA provides written notice of the decision. When a 
reassessment results in an increase in the monthly stipend payment for 
a Primary Family Caregiver of a legacy applicant or legacy participant, 
the increase takes effect as of the date of the reassessment. 38 CFR 
71.40(c)(4)(ii)(C)(2)(i). Such determination is considered final and is 
not subject to the 60-day advanced notice period for stipend decreases 
under Sec.  71.40(c)(4)(ii)(C)(2)(ii) and discharges under Sec.  
71.45(b)(1)(i)(A). Therefore, VA would not repeat reassessments for the 
legacy cohort that resulted in a favorable determination before March 
25, 2022. However, this would not preclude a claimant from requesting a 
review of or appealing a PCAFC decision issued before March 25, 2022, 
to the extent authorized by law.
    Prior to the Veteran Warriors decision on March 25, 2022, VA had 
completed approximately 80 percent of the reassessments for the legacy 
cohort. As a result of those reassessments, VA determined that 
approximately 12,970 of the legacy participants and legacy applicants 
in the legacy cohort that were reassessed were no longer eligible for 
PCAFC, and approximately 360 legacy participants and legacy applicants 
that were reassessed would remain eligible but their Primary Family 
Caregiver's monthly stipend would be reduced based on the stipend level 
criteria in Sec.  71.40(c)(4)(i)(A). Each of these approximately 13,330 
individuals was provided preliminary findings from VA following their 
reassessments.
    Since VA cannot rely on preliminary findings regarding stipend 
decreases and discharges for the legacy cohort that were based on VA's 
definition for need for supervision, protection, or instruction that 
was invalidated by the decision in Veteran Warriors, VA must repeat 
reassessments for such members of the legacy cohort who were reassessed 
using the definition of need for supervision, protection, or 
instruction (hereinafter referred to as ``repeat reassessments''). In 
light of the short timeframe between the date Veteran Warriors was 
decided and September 30, 2022, VA will not be able to complete the 
remaining reassessments and repeat reassessments before the transition 
period for the legacy cohort is set to end under VA's current 
regulations. In order to maintain equity and parity within the legacy 
cohort, VA believes it is prudent to extend the eligibility for the 
entire legacy cohort until all members of the legacy cohort have been 
reassessed using the same eligibility criteria.\2\
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    \2\ Changes to 38 CFR part 71 that are required as a result of 
Veteran Warriors will be addressed in a separate rulemaking.
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B. Duration of Extension

    VA believes that a three-year extension is necessary to complete 
remaining reassessments and repeat reassessments, particularly as the 
second phase of PCAFC expansion begins on October 1, 2022, when VA 
anticipates an influx of an unknown quantity of applications. VA 
expects the surge in new applications associated with the second phase 
of PCAFC expansion will impact its ability to timely complete the 
remaining reassessments and repeat reassessments.
    The VA MISSION Act of 2018 amended 38 U.S.C. 1720G by expanding 
eligibility for PCAFC to Family Caregivers of eligible veterans who 
incurred or aggravated a serious injury in the line of duty before 
September 11, 2001, in a two-phase approach. As described in the First 
PCAFC Extension for Legacy Cohort, VA received a dramatic increase in 
PCAFC applications at the onset of the first phase of expansion. VA 
anticipates the second phase of expansion, which takes effect October 
1, 2022, will also result in a surge in new applications. VA believes 
it has adequately prepared for the influx of applications that will be 
received beginning on October 1, 2022, through staffing enhancements, 
streamlining processes, and continuing to provide Caregiver Support 
Program staff with focused trainings. VA increased the number of 
approved Caregiver Support Program positions by over 350 in fiscal year 
2022, bringing the total number of positions to 2,325. As of August 30, 
2022, 89 percent of all positions have been filled. VA has streamlined 
its approach to the PCAFC assessment process by eliminating 
redundancies in assessments and evaluations, where possible. Targeted 
trainings have been provided to PCAFC staff focused on the process of 
conducting evaluations of PCAFC eligibility to build consistency and 
standardization in decision making, as well as delivery of PCAFC 
services. Trainings have reinforced a holistic approach in evaluating 
not only eligibility for PCAFC but also identifying opportunities for 
referrals to supports and services beyond PCAFC that are available 
through VA and outside VA. Each of these initiatives has positioned VA 
to improve the experience of those already participating in PCAFC, 
those who are

[[Page 57605]]

applying for PCAFC currently, and individuals who will apply as a 
result of second phase of expansion.
    While VA has planned and prepared for a surge in new applications 
as a result of this long-awaited second phase of expansion, similar to 
the surge in applications VA received as a result of the first phase of 
expansion, VA did so based on the presumption that all necessary 
reassessments of the legacy cohort would have already been completed 
before October 1, 2022. VA does not know the exact quantity of 
applications VA will receive under the second phase of expansion, but 
VA anticipates that completing necessary reassessments of the legacy 
cohort while also adjudicating a surge in PCAFC applications received 
on and after October 1, 2022, will be challenging. Thus, to mitigate 
delay in new Family Caregivers obtaining PCAFC benefits, VA anticipates 
focusing our resources initially on evaluating these new applications 
received at the onset of the second phase of expansion, which will mean 
that additional time is needed to complete necessary reassessments and 
repeat reassessments of the legacy cohort.
    This current scenario closely mirrors the scenario when the first 
phase of PCAFC expansion began in 2020. At that time, VA experienced a 
surge of new applications but also had to conduct reassessments of the 
legacy cohort. VA found that two years were needed (from October 1, 
2020, to September 30, 2022) to complete most of the legacy cohort 
reassessments under 38 CFR 71.30(e), as explained in the First PCAFC 
Extension for Legacy Cohort. See 86 FR 52615.
    While VA has planned and prepared for a surge in new applications 
starting October 1, 2022, it needs to extend the transition period for 
three additional years to complete reassessments and repeat 
reassessments of the legacy cohort. While VA acknowledges that it 
determined two years were needed under the previous expansion, VA 
believes that three years will be needed during phase two of expansion 
to accommodate unforeseen circumstances or barriers that could 
interfere with VA's ability to complete reassessments and repeat 
reassessments.
    For those reasons explained above, VA is now extending the 
transition period for three additional years (until September 30, 2025) 
for the legacy cohort while VA completes the remaining reassessments 
and repeat reassessments. This extension will ensure that all members 
of the legacy cohort have the same transition period and the same 
effective date for any termination or reduction in benefits, regardless 
of whether the reassessment was completed before or after the Veteran 
Warriors decision.
    Without this extension, the current regulations would require VA to 
proceed in one of two ways starting October 1, 2022, both of which 
would be harmful to a portion of legacy applicants, legacy 
participants, and their Family Caregivers. First, VA could carry out 
the stipend decreases and discharges based on the determinations 
regarding the legacy cohort that were made before Veteran Warriors 
using the ``need for supervision, protection, or instruction'' 
regulatory definition. However, that would be unfair and inequitable to 
those legacy participants, legacy applicants, and their Family 
Caregivers because they would not have the benefit of being reassessed 
under the same criteria as those reassessed after Veterans Warriors 
(under the statutory criteria in 38 U.S.C. 1720G(a)(2)(C)(ii) and 
(iii)), and the outcome of their determinations may be different if VA 
applied the statutory criteria in section 1720G(a)(2)(C)(ii) and (iii).
    In the alternative, VA could set aside the stipend decreases and 
discharges based on the determinations that were made before Veterans 
Warriors using the ``need for supervision, protection, or instruction'' 
regulatory definition, but proceed in carrying out the stipend 
decreases and discharges that were determined after Veteran Warriors, 
as those determinations correctly used the statutory criteria in 
section 1720G(a)(2)(C)(ii) and (iii). However, this too would be unfair 
and inequitable to those legacy participants, legacy applicants, and 
their Family Caregivers with determinations made after Veteran Warriors 
because it would mean that they would have a shorter transition period 
than those for whom VA initiates repeat reassessments after October 1, 
2022, because their determinations were made before Veterans Warriors. 
This is because the legacy applicants, legacy participants, and their 
Family Caregivers who are reassessed and found to be no longer eligible 
for PCAFC, or eligible but with a reduced stipend amount, would be 
impacted at different times. Some legacy participants, legacy 
applicants, and their Family Caregivers would experience negative 
impacts before others within this same cohort based on when they are 
reassessed. The varying impact would result from no reason other than 
that VA reassessed certain individuals prior to the Veterans Warriors 
decision and needed to conduct a repeat reassessment at a later date 
after October 1, 2022, than those individuals who were reassessed after 
Veterans Warriors under the statutory criteria in 38 U.S.C. 
1720G(a)(2)(C)(ii) and (iii) before that date.

C. Stipend Payment Provisions

Special Rule for Primary Family Caregivers Subject to Decrease Because 
of Monthly Stipend Rate

    The initial one-year transition period for the legacy cohort was 
intended to establish a transition plan for the legacy cohort who may 
or may not meet the new eligibility criteria and whose Primary Family 
Caregivers could have their stipend amount impacted by changes to the 
stipend payment calculation. 85 FR 13356 (March 6, 2020). VA intended 
for the stipend amount for Primary Family Caregivers of legacy 
participants and legacy applicants to remain generally unchanged during 
the transition period, unless it is to their benefit, and so long as 
the eligible veteran did not relocate. 85 FR 13387. To this end, 38 CFR 
71.40(c)(4)(i)(D) permits the Primary Family Caregiver of an eligible 
veteran who meets the requirements of Sec.  71.20(b) (i.e., legacy 
participants) to receive a monthly stipend that is not less than the 
amount the Primary Family Caregiver was eligible to receive as of the 
day before October 1, 2020 (based on the eligible veteran's address on 
record with PCAFC on such date), so long as the eligible veteran 
resides at the same address on record with PCAFC as of the day before 
October 1, 2020. VA believed that this special rule would provide 
legacy participants and their Primary Family Caregivers time to adjust 
to the proposed changes in PCAFC eligibility and the stipend payment 
methodology. Id. at 13385. When VA published the First PCAFC Extension 
for Legacy Cohort, VA continued for an additional year this special 
rule, and VA believes it is necessary to continue this special rule for 
an additional three years while VA completes reassessments and repeat 
reassessments for the legacy cohort.
    VA believes this is necessary as the transition period for the 
legacy cohort is intertwined with the special rule in Sec.  
71.40(c)(4)(i)(D). VA never anticipated that the transition period 
associated with the special rule would be any different than the 
transition period authorized in other provisions of part 71 concerning 
the legacy cohort. VA's transition plan was intended to mitigate 
potentially negative impact on the legacy cohort based on changes VA 
made to the PCAFC eligibility criteria and stipend payment methodology. 
85 FR 46268, 46270, and 46275. It was

[[Page 57606]]

never VA's intention to remove the special rule in Sec.  
71.40(c)(4)(i)(D) before the conclusion of the transition period for 
the legacy cohort in other provisions of part 71 and doing so could 
cause hardship to the Primary Family Caregivers still receiving 
stipends under the special rule.
    Moreover, CARMA, which is the workflow management tool used within 
the Caregiver Support Program and which automates the stipend payment 
calculation, intricately intertwines the transition period and the 
special rule. The workflow functionality within CARMA allows a Primary 
Family Caregiver to be transitioned off the special rule only if the 
legacy participant relocates to a new address or if the Primary Family 
Caregiver is eligible for a higher monthly stipend level as a result of 
a reassessment under Sec.  71.30(e)(1) or as a result of Office of 
Personnel Management (OPM) updates to the General Schedule (GS). This 
functionality is by design, and bifurcating this functionality would 
require additional development, time, and resources. In the future, if 
VA determines that it is appropriate to uncouple the special rule from 
the transition period associated with the legacy cohort, VA will do so 
in a future rulemaking.
Adjustments to Stipend Payments
    When VA established the initial one-year transition period for the 
legacy cohort, Sec.  71.40(c)(4)(ii) was revised to address adjustments 
to stipend payments. 85 FR 46297. Section 71.40(c)(4)(ii)(C)(2) focuses 
on adjustments to monthly stipends pursuant to reassessments conducted 
by VA under Sec.  71.30 for eligible veterans who meet the requirements 
of Sec.  71.20(b) or (c) (i.e., legacy participants and legacy 
applicants) whose Primary Family Caregivers received monthly stipends 
pursuant to Sec.  71.40(c)(4)(i)(B) or (D). Section 
71.40(c)(4)(ii)(C)(2)(i) focuses on reassessments that result in an 
increase in the monthly stipend, sets forth the effective date of this 
increase, and authorizes retroactive payments because of this increase. 
Under Sec.  71.40(c)(4)(ii)(C)(2)(i), VA provides retroactive payments 
back to October 1, 2020 in recognition that not all legacy participants 
and legacy applicants are reassessed at one time but rather are 
reassessed at different points during the transition period. 
Retroactive payments ensure that the Primary Family Caregivers of all 
legacy participants and legacy applicants meeting the requirements of 
Sec.  71.20(a) receive the benefit of any stipend increase as of 
October 1, 2020, regardless of when the reassessment is completed 
during the transition period.
    Further, Sec.  71.40(c)(4)(ii)(C)(2)(i) states that if more than 
one reassessment is completed during the two-year period beginning on 
October 1, 2020, the retroactive payment would only apply if the first 
reassessment during the two-year period beginning on October 1, 2020 
results in an increase in the monthly stipend payment, and retroactive 
payments only apply as a result of the first reassessment. VA believed 
that any subsequent reassessment completed after the initial 
reassessment of a legacy participant or legacy applicant would likely 
be based on changes in the circumstances of the legacy participant or 
legacy applicant, such that retroactive payments back to a date before 
a previous reassessment would not be warranted. 85 FR 13389.
    However, as a result of Veteran Warriors, VA must initiate repeat 
reassessments for purposes unrelated to the specific circumstances of 
the legacy participant or legacy applicant. As discussed above, the 
repeat reassessments are needed because the definition of need for 
supervision, protection, or instruction that was relied upon by VA 
during reassessments completed before Veteran Warriors, was invalidated 
by the court's decision. VA cannot rely on preliminary findings 
regarding stipend decreases and discharges for the legacy cohort that 
were based on VA's definition of need for supervision, protection, or 
instruction that was invalidated by the decision in Veteran Warriors. 
Since this decision, VA has applied 38 U.S.C. 1720G(a)(2)(C)(ii) and 
(iii) in place of this definition when making PCAFC eligibility and 
stipend level determinations.
    To maintain equity among members of the legacy cohort, VA believes 
that those who will require a repeat reassessment as a result of 
Veteran Warriors should be eligible to receive a retroactive payment 
under 38 CFR 71.40(c)(4)(ii)(C)(2)(i) if the repeat reassessment 
results in a stipend increase. For example, a reassessment of a legacy 
participant and their Primary Family Caregiver could have been 
completed in February 2022 applying the definition of need for 
supervision, protection, or instruction, among other applicable 
criteria, which resulted in a determination of continued eligibility 
under Sec.  71.20(a), but at a reduced monthly stipend amount. If a 
repeat reassessment is completed in November 2022 applying 38 U.S.C. 
1720G(a)(2)(C)(ii) and (iii) in place of the definition of need for 
supervision, protection, or instruction, which results in a 
determination of continued eligibility, but at the higher monthly 
stipend level, which is more than the monthly stipend amount the 
Primary Family Caregiver was receiving before the repeat reassessment, 
VA believes the Primary Family Caregiver should be eligible for the 
retroactive increase back to October 1, 2020, which is presumably what 
would have been authorized had VA applied section 1720G(a)(2)(C)(ii) 
and (iii) in place of the definition of need for supervision, 
protection, or instruction during the first reassessment.
    Therefore, VA adds a sentence to the end of 38 CFR 
71.40(c)(4)(ii)(C)(2)(i) explaining that notwithstanding the previous 
sentence (i.e., the last sentence in the current paragraph), if the 
first reassessment during the five-year period beginning on October 1, 
2020 was completed by VA before March 25, 2022, and such reassessment 
did not result in an increase in the monthly stipend payment, the 
retroactive payment described in this paragraph applies to the first 
reassessment initiated by VA on or after March 25, 2022 that applies 
the criteria in 38 U.S.C. 1720G(a)(2)(C)(ii) and (iii) in place of the 
definition of need for supervision, protection, or instruction that was 
invalidated by Veteran Warriors, if such reassessment results in an 
increase in the monthly stipend payment, and only as a result of such 
reassessment.

III. Changes to 38 CFR Part 71

    For the reasons explained above, VA amends its regulations codified 
in 38 CFR 71.20 regarding program eligibility, Sec.  71.30 regarding 
reassessments, and Sec.  71.40 regarding caregiver benefits, to extend 
the transition period for legacy applicants, legacy participants, and 
their Family Caregivers from two years to five years (that is, until 
October 1, 2025) and to extend the time period for VA to conduct 
reassessments of such individuals from two years to five years (that 
is, until October 1, 2025).
    VA amends Sec.  71.20 by removing the words ``two years'' in Sec.  
71.20(b) and (c), and adding, in their place, the words ``five years''.
    VA amends Sec.  71.30 by removing the words ``two-year'' in 
paragraphs (e)(1) and (2) and adding, in their place, the words ``five-
year''.
    VA also amends Sec.  71.40 by removing the words ``two years'' in 
paragraphs (c)(4)(i)(B) through (D) and adding, in their place, the 
words ``five years''. VA similarly amends paragraph (c)(4)(ii)(C)(2)(i) 
by removing the words ``two-year'' and adding, in their place, the 
words ``five-year''. Additionally, VA

[[Page 57607]]

revises paragraph (c)(4)(ii)(C)(2)(i) by adding a sentence to the end 
of the paragraph explaining that notwithstanding the previous sentence 
(i.e., the last sentence in the current paragraph), if the first 
reassessment during the five-year period beginning on October 1, 2020 
was completed by VA before March 25, 2022, and such reassessment did 
not result in an increase in the monthly stipend payment, the 
retroactive payment described in this paragraph applies to the first 
reassessment initiated by VA on or after March 25, 2022 that applies 
the criteria in section 1720G(a)(2)(C)(ii) and (iii) in place of the 
definition of need for supervision, protection, or instruction that was 
invalidated by Veteran Warriors, if such reassessment results in an 
increase in the monthly stipend payment, and only as a result of such 
reassessment. Lastly, VA amends paragraph (c)(4)(ii)(C)(2)(ii) and the 
note to paragraph (c)(4)(ii)(C)(2) by removing the words ``October 1, 
2022'', and adding, in their place, the words ``October 1, 2025''.

IV. Technical Amendments

    The VA MISSION Act of 2018 amended 38 U.S.C. 1720G by expanding 
eligibility for PCAFC to Family Caregivers of eligible veterans who 
incurred or aggravated a serious injury in the line of duty before 
September 11, 2001, in a two-phase approach. The first phase expanded 
PCAFC to eligible veterans who incurred or aggravated a serious injury 
(including traumatic brain injury, psychological trauma, or other 
mental disorder) in the line of duty on or before May 7, 1975, and 
began on the date the Secretary submitted a certification to Congress 
that VA fully implemented a required IT system required by section 
162(a) of the VA MISSION Act of 2018. 38 U.S.C. 1720G(a)(2)(B)(ii). The 
second phase will begin two years after the date the Secretary 
submitted such certification to Congress. Id. at 1720G(a)(2)(B)(iii). 
As part of the July 31, 2020 rulemaking, VA referenced these dates of 
certification required by the VA MISSION Act of 2018 in 38 CFR 
71.20(a)(2)(ii) and (iii) and 71.25(a)(3)(ii)(A) and (B) by using the 
phrases ``date specified in a future Federal Register document'' and 
``date published in a future Federal Register document''. 85 FR 46295-
96. Section 71.20(a)(2)(ii) and (iii) refer to the time periods within 
which the individual's serious injury must have been incurred or 
aggravated for purposes of the first and second phases of expansion, 
respectively. Section 71.20(a)(3)(ii)(A) and (B) refer to the dates VA 
will begin approving joint applications pursuant to Sec.  
71.20(a)(2)(ii) and (iii), respectively.
    On October 7, 2020, VA published a Federal Register Notice (FRN) 
announcing that, in accordance with the requirements of the VA MISSION 
Act of 2018, the Secretary submitted to Congress on October 1, 2020, a 
certification that VA fully implemented the IT system required by the 
Act. 85 FR 63358 (October 7, 2020). This certification enabled VA to 
begin the first phase of the PCAFC expansion on October 1, 2020, and 
the second phase will begin on October 1, 2022. VA is amending 
Sec. Sec.  71.20(a)(2)(ii) and (iii) and 71.25(a)(3)(ii)(A) and (B), to 
reflect these dates.
    Thus, Sec.  71.20(a)(2)(ii) is amended to replace ``on the date 
specified in a future Federal Register document'' with ``October 1, 
2020''. Section 71.20(a)(2)(iii) is amended to replace ``two years 
after the date specified in a future Federal Register document as 
described in paragraph (a)(2)(ii) of this section'' with ``October 1, 
2022''. Section 71.25(a)(3)(ii)(A) is amended to replace ``the date 
published in a future Federal Register document that is specified in 
such section'' and ``the date published in a future Federal Register 
document that is specified in Sec.  71.20(a)(2)(ii)'' with ``October 1, 
2020''. Section 71.25(a)(3)(ii)(B) is amended to replace ``the date 
that is two years after the date published in a future Federal Register 
document that is specified in Sec.  71.20(a)(2)(ii)'' each time it 
appears with ``October 1, 2022''.
    These are non-substantive technical amendments that will reflect 
the publication of the October 7, 2020 FRN and add clarity to the 
regulation but will have no impact on PCAFC eligibility criteria nor 
VA's administration of PCAFC.
    Additionally, in the July 31, 2020 rulemaking, VA redesignated 
Sec.  71.30, which pertained to the Program of General Caregiver 
Support Services (PGCSS), as Sec.  71.35. 85 FR 46296. The definition 
for general caregiver under Sec.  71.15 refers to an individual who 
meets the requirements of PGCSS; however, the cross-reference in the 
definition directs readers to Sec.  71.30, which now pertains to 
reassessments of eligible veterans and Family Caregivers. Accordingly, 
the definition for general caregiver is amended to include the correct 
cross-reference to Sec.  71.35.
    Further, in Sec.  71.40 in the note to paragraph (c)(4)(ii)(C)(2), 
VA is redesignating the note as ``Note 1 to paragraph 
(c)(4)(ii)(C)(2)''. The Office of Federal Register has directed that 
even if there is only one note in a section, it must still be 
designated as ``Note 1.'' Therefore, we are redesignating the note 
accordingly.

Administrative Procedure Act

    The Secretary of Veterans Affairs finds that there is good cause 
under 5 U.S.C. 553(b)(B) to publish this rule without prior notice and 
opportunity for public comment, as notice and comment would be 
impracticable and contrary to public interest. Generally, VA would seek 
notice and comment in advance of issuing a final rule. However, in this 
circumstance, VA does not have sufficient time to provide the public 
with the opportunity for prior notice and comment and have the 
amendments effective by October 1, 2022. To provide such opportunity 
would cause harm to the eligible veterans and Family Caregivers who 
greatly benefit from and rely on PCAFC. As discussed earlier, due to 
the Veteran Warriors case, for those determinations involving the 
``need for supervision, protection, or instruction'' definition in 38 
CFR 71.15 that were still pending issuance of a last notice of decision 
on March 25, 2022, VA must re-evaluate such determinations based on the 
Veteran Warriors decision. VA cannot rely on preliminary findings 
regarding stipend decreases and discharges for the legacy cohort that 
were based on VA's regulatory definition for need for supervision, 
protection, or instruction, and therefore these reassessments must be 
repeated. At the time of the court's decision, VA had already completed 
approximately 80 percent of assessments for the legacy cohort. However, 
VA will not be able to repeat reassessments that were completed prior 
to the Veteran Warriors decision in addition to completing remaining 
reassessments that have yet to be completed by October 1, 2022. The 
time period is much too short for VA to be able to repeat and complete 
all these reassessments.
    Therefore, absent regulatory action, as mentioned earlier, the 
current regulations would require VA to proceed in one of two ways, 
both of which would be harmful to a portion of legacy applicants, 
legacy participants, and their Family Caregivers. First, VA could carry 
out the stipend decreases and discharges based on the determinations 
regarding the legacy cohort that were made before Veteran Warriors 
using the ``need for supervision, protection, or instruction'' 
regulatory definition. In the alternative, VA could set aside the 
stipend decreases and discharges based on the determinations that were 
made before Veterans Warriors using the ``need for supervision, 
protection, or instruction''

[[Page 57608]]

regulatory definition, but proceed in carrying out the stipend 
decreases and discharges that were determined after Veteran Warriors, 
as those determinations correctly used the statutory criteria in 
section 1720G(a)(2)(C)(ii) and (iii). However, as explained earlier, 
neither option would be fair and equitable to all members of the legacy 
cohort.
    Therefore, extending the transition and reassessment period in 
advance of October 1, 2022, is necessary to provide time for VA to 
repeat reassessments that were completed prior to the Veterans Warriors 
decision (in addition to complete remaining reassessments) in order to 
maintain equity and parity among the legacy applicants, legacy 
participants, and their Family Caregivers. Otherwise, certain eligible 
veterans and Family Caregivers may be harmed, which would be contrary 
to public interest.
    Notwithstanding the need to publish these amendments as an interim 
final rule, VA invites public comments on the amendments and will fully 
consider and address any comments received.
    For the reasons stated above, the Secretary also finds good cause 
under 5 U.S.C. 553(d)(3) to make this interim final rule effective on 
the date of its publication in the Federal Register.

Executive Orders 12866 and 13563

    Executive Orders 12866 and 13563 direct agencies to assess the 
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 effects, and other advantages; distributive impacts; 
and equity). Executive Order 13563 (Improving Regulation and Regulatory 
Review) emphasizes the importance of quantifying both costs and 
benefits, reducing costs, harmonizing rules, and promoting flexibility. 
The Office of Information and Regulatory Affairs has determined that 
this rule is a significant regulatory action under Executive Order 
12866. The Regulatory Impact Analysis associated with this rulemaking 
can be found as a supporting document at www.regulations.gov.

Regulatory Flexibility Act

    The Secretary hereby certifies that this interim final rule 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). This interim final rule extends the time for VA to 
conduct reassessments of legacy applicants, legacy participants, and 
their Family Caregivers and the transition period for such individuals. 
This rule will have no impact on small entities. Therefore, pursuant to 
5 U.S.C. 605(b), the initial and final regulatory flexibility analysis 
requirements of 5 U.S.C. 603 and 604 do not apply.

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 the 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 one year. This interim final rule will have no such 
effect on State, local, and tribal governments, or on the private 
sector.

Paperwork Reduction Act

    This interim final rule contains no provisions constituting a 
collection of information under the Paperwork Reduction Act of 1995 (44 
U.S.C. 3501-3521).

Congressional Review Act

    Pursuant to Congressional Review Act) (5 U.S.C. 801 et seq.), the 
Office of Information and Regulatory Affairs designated this rule as 
not a major rule, as defined by 5 U.S.C. 804(2).

List of Subjects in 38 CFR Part 71

    Administrative practice and procedure, Claims, Health care, Health 
facilities, Health professions, Mental health programs, Public 
assistance programs, Travel and transportation expenses, Veterans.

Signing Authority

    Denis McDonough, Secretary of Veterans Affairs, approved this 
document on August 19, 2022, and authorized the undersigned to sign and 
submit the document to the Office of the Federal Register for 
publication electronically as an official document of the Department of 
Veterans Affairs.

Consuela Benjamin,
Regulations Development Coordinator, Office of Regulation Policy & 
Management, Office of General Counsel, Department of Veterans Affairs.

    For the reasons stated in the preamble, the Department of Veterans 
Affairs amends 38 CFR part 71 as follows:

PART 71--CAREGIVERS BENEFITS AND CERTAIN MEDICAL BENEFITS OFFERED 
TO FAMILY MEMBERS OF VETERANS

0
1. The authority citation for part 71 continues to read as follows:

    Authority:  38 U.S.C. 501, 1720G, unless otherwise noted.

    Section 71.40 also issued under 38 U.S.C. 111(e), 1720B, 1782.
    Section 71.47 also issued under 31 U.S.C. 3711; 38 U.S.C. 5302, 
5314.
    Section 71.50 also issued under 38 U.S.C. 1782.


Sec.  71.15  [Amended]

0
2. Amend Sec.  71.15 by, in the definition of ``General Caregiver'', 
removing ``Sec.  71.30'' and adding in its place ``Sec.  71.35''.


Sec.  71.20  [Amended]

0
3. Amend Sec.  71.20 by:
0
a. In paragraph (a)(2)(ii), removing ``on the date specified in a 
future Federal Register document'' and adding in its place ``October 1, 
2020''.
0
b. In paragraph (a)(2)(iii), removing ``two years after the date 
specified in a future Federal Register document as described in 
paragraph (a)(2)(ii) of this section'' and adding in its place 
``October 1, 2022''.
0
c. In paragraphs (b) and (c), removing ``two years'' and adding in its 
place ``five years''.


Sec.  71.25  [Amended]

0
4. Amend Sec.  71.25 by:
0
a. In paragraph (a)(3)(ii)(A), removing ``the date published in a 
future Federal Register document that is specified in such section'' 
and ``the date published in a future Federal Register document that is 
specified in Sec.  71.20(a)(2)(ii)'' and adding in their places 
``October 1, 2020''.
0
b. In paragraph (a)(3)(ii)(B), removing ``the date that is two years 
after the date published in a future Federal Register document that is 
specified in Sec.  71.20(a)(2)(ii)'' each time it appears and adding in 
its place ``October 1, 2022''.


Sec.  71.30  [Amended]

0
5. Amend Sec.  71.30(e)(1) and (2) by removing ``two-year'' and adding 
in its place ``five-year''.

0
6. Amend Sec.  71.40 by:
0
a. In the introductory text of paragraph (c)(4)(i)(B), removing ``two 
years'' and adding in its place ``five years''.
0
b. In paragraphs (c)(4)(i)(C) and (D), removing ``two years'' and 
adding in its place ``five years''.
0
c. In paragraph (c)(4)(ii)(C)(2)(i):

[[Page 57609]]

0
i. Removing ``two-year'' each time it appears and adding in its place 
``five-year''.
0
ii. Adding a sentence to the end of the paragraph.
0
d. In paragraph (c)(4)(ii)(C)(2)(ii), removing ``October 1, 2022'' each 
time it appears and adding in its place ``October 1, 2025''.
0
e. In the note to paragraph (c)(4)(ii)(C)(2):
0
i. Redesignating the note as note 1 to paragraph (c)(4)(ii)(C)(2).
0
ii. Removing ``October 1, 2022'' each time it appears and adding in its 
place ``October 1, 2025''.
    The revision reads as follows:


Sec.  71.40   Caregiver benefits.

* * * * *
    (c) * * *
    (4) * * *
    (ii) * * *
    (C) * * *
    (2) * * *
    (i) * * * Notwithstanding the previous sentence, if the first 
reassessment during the five-year period beginning on October 1, 2020 
was completed by VA before March 25, 2022, and such reassessment did 
not result in an increase in the monthly stipend payment, the 
retroactive payment described in this paragraph (c)(4)(ii)(C)(2)(i) 
applies to the first reassessment initiated by VA on or after March 25, 
2022 that applies the criteria in 38 U.S.C. 1720G(a)(2)(C)(ii) and 
(iii) in place of the definition of ``need for supervision, protection, 
or instruction'' that was invalidated by Veteran Warriors, Inc. v. 
Sec'y of Veterans Affairs, 29 F.4th 1320, 1342-43 (Fed. Cir. 2022), if 
such reassessment results in an increase in the monthly stipend 
payment, and only as a result of such reassessment.
* * * * *
[FR Doc. 2022-20271 Filed 9-20-22; 8:45 am]
BILLING CODE 8320-01-P