## Chapter 2. Automobile and Adaptive Equipment Allowance Under 38 U.S.C. Chapter 39

#### Table of Contents

> 1\. Eligibility for Automobile and Adaptive Equipment Allowance 2-1
>
> 2\. Application for Automobile and Adaptive Equipment Allowance 2-4
>
> 3\. Rating Claims for Automobile and Adaptive Equipment Allowance 2-6
>
> 4\. Notifying Claimants 2-7
>
> 5\. Processing Claims for Automobile and Adaptive Equipment Allowance
> 2-9
>
> 6\. Processing and Paying Eligibility Requests and Certificates of
> Eligibility 2-14
>
> 7\. Processing Notice of Disagreements (NODs) or Substantive Appeals
> 2-17

## Chapter 2. Automobile and Adaptive Equipment Allowance Under 38 U.S.C. Chapter 39

#### 1. Eligibility for Automobile and Adaptive Equipment Allowance

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on the eligibility    |
| troduction | > requirements for automobile and adaptive equipment    |
|            | > allowance, including information on                   |
|            |                                                         |
|            | -   · the eligibility requirements for financial        |
|            |     assistance for a conveyance                         |
|            |                                                         |
|            | -   · issuing a certificate of eligibility              |
|            |                                                         |
|            | -   · the eligibility requirements for adaptive         |
|            |     equipment                                           |
|            |                                                         |
|            | -   · the definition of the term ***adaptive            |
|            |     equipment***                                        |
|            |                                                         |
|            | -   · eligibility for disability acquired after         |
|            |     discharge, and                                      |
|            |                                                         |
|            | -   · eligibility for 38 U.S.C. Chapter 31              |
|            |     beneficiaries.                                      |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > To be eligible for financial assistance in purchasing |
|  a. Eligib | > a new or used automobile (or other conveyance), a     |
| ility Requ | > veteran or serviceperson must possess one of the      |
| irements f | > following disabilities as a result of injury or       |
| or Financi | > disease incurred or aggravated during activity        |
| al Assista | > military service:                                     |
| nce for a  |                                                         |
| Conveyance | -   · loss, or permanent loss of use, of one or both    |
|            |     feet                                                |
|            |                                                         |
|            | -   · loss, or permanent loss of use, of one or both    |
|            |     hands, or                                           |
|            |                                                         |
|            | -   · permanent impairment of vision in both eyes with  |
|            |     a                                                   |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   \- central visual acuity of 20/200 or less in the   |
|            |     better eye with corrective glasses, or              |
|            |                                                         |
|            | -   \- central visual acuity of more than 20/200 if     |
|            |     there is a field defect in which the peripheral     |
|            |     field has contracted to such an extent that the     |
|            |     widest diameter of visual field has an angular      |
|            |     distance no greater than 20 degrees in the better   |
|            |     eye.                                                |
|            |                                                         |
|            | > ***Reference***: For more information on the          |
|            | > eligibility requirements for the automobile allowance |
|            | > and adaptive equipment, see 38 U.S.C. Chapter 39.     |
+------------+---------------------------------------------------------+

Continued on next page

1\. Eligibility for Automobile and Adaptive Equipment Allowance,
Continued

+------------+---------------------------------------------------------+
| #####      | > A certificate of eligibility for financial assistance |
|  b. Issuin | > in the purchase of a new or used automobile or other  |
| g a Certif | > conveyance (such as a van, truck, jeep, or station    |
| icate of E | > wagon) may be made to a veteran                       |
| ligibility |                                                         |
|            | -   · once in his/her lifetime                          |
|            |                                                         |
|            | -   · in an amount not exceeding the amount specified   |
|            |     in 38 U.S.C. 3902, and                              |
|            |                                                         |
|            | -   · if the eligibility requirements are met.          |
|            |                                                         |
|            | > ***Note***: The law prohibits Department of Veterans  |
|            | > Affairs (VA) from making payments for automobile      |
|            | > grants directly to veterans. VA is required to pay    |
|            | > the benefit to the seller of the automobile.          |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > A veteran or serviceperson who qualifies for the      |
| c. Eligibi | > automobile allowance also qualifies for adaptive      |
| lity Requi | > equipment. To be eligible to receive *only* adaptive  |
| rements fo | > equipment (as opposed to the automobile allowance),   |
| r Adaptive | > the veteran or serviceperson must be entitled to      |
|  Equipment | > disability compensation for ankylosis of one (or      |
|            | > both) knees or hips.                                  |
|            | >                                                       |
|            | > The adaptive equipment benefit may be paid more than  |
|            | > once, and it may be paid to either the seller or the  |
|            | > veteran.                                              |
|            | >                                                       |
|            | > ***Reference***: For more information on ankylosis of |
|            | > one (or both) knees or hips, see 38 U.S.C.            |
|            | > 3902(b)(2).                                           |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### d.   | > The term ***adaptive equipment*** includes, but is    |
| Definition | > not limited to                                        |
| : Adaptive |                                                         |
|  Equipment | -   · power steering                                    |
|            |                                                         |
|            | -   · power brakes                                      |
|            |                                                         |
|            | -   · power window lifts                                |
|            |                                                         |
|            | -   · power seats, and                                  |
|            |                                                         |
|            | -   · special equipment necessary to assist the         |
|            |     eligible person into and out of the automobile or   |
|            |     other conveyance.                                   |
+------------+---------------------------------------------------------+

Continued on next page

1\. Eligibility for Automobile and Adaptive Equipment Allowance,
Continued

+------------+---------------------------------------------------------+
| ##### e. E | > A veteran does *not* qualify for adaptive equipment   |
| ligibility | > if any of the following conditions are applicable:    |
|  for Disab |                                                         |
| ility Acqu | -   · the disability is acquired after discharge from   |
| ired after |     service as a result of treatment in a VA medical    |
|  Discharge |     facility (38 U.S.C. 1151), or                       |
|            |                                                         |
|            | -   · the disability is acquired as a result of         |
|            |     training under 38 U.S.C. Chapter 31, even though    |
|            |     compensation is payable under 38 CFR 3.800(a), and  |
|            |                                                         |
|            | -   · he/she is entitled to compensation for paired     |
|            |     service-connected (SC) or nonservice-connected      |
|            |     (NSC) organs or extremities under 38 U.S.C. 1160.   |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### f.   | > Automobile adaptive equipment may be furnished to a   |
| Eligibilit | > beneficiary under 38 U.S.C. Chapter 31 if the         |
| y for 38 U | > Vocational Rehabilitation and Employment (VR&E)       |
| .S.C. Chap | > determines that the equipment is necessary to         |
| ter 31 Ben |                                                         |
| eficiaries | -   · overcome an employment handicap to which a SC     |
|            |     disability materially contributes, and              |
|            |                                                         |
|            | -   · achieve the goals of the program of               |
|            |     rehabilitation.                                     |
|            |                                                         |
|            | > ***Reference***: For more information on eligibility, |
|            | > see 38 CFR 21.216(a)(3).                              |
+------------+---------------------------------------------------------+

#### 2. Application for Automobile and Adaptive Equipment Allowance

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on applications for   |
| troduction | > automobile and adaptive equipment allowance,          |
|            | > including information on                              |
|            |                                                         |
|            | -   · applying for automobile allowance                 |
|            |                                                         |
|            | -   · applying for adaptive equipment, and              |
|            |                                                         |
|            | -   · handling incomplete applications.                 |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##         | > A formal claim on *VA Form 21-4502, Application for   |
| ### a. App | > Automobile or Other Conveyance and Adaptive           |
| lying for  | > Equipment* is required if the veteran or              |
| Automobile | > serviceperson is applying for the automobile          |
|  Allowance | > allowance.                                            |
|            | >                                                       |
|            | > The application for an automobile or other conveyance |
|            | > is considered an application for the adaptive         |
|            | > equipment specified for the claimant's disability by  |
|            | > directive of the Chief Medical Director. The          |
|            | > instructions on the *VA Form 21-4502* contain a list  |
|            | > of adaptive equipment that have been preapproved for  |
|            | > particular disabilities.                              |
|            | >                                                       |
|            | > ***Note***: There is no time limit for filing a       |
|            | > claim.                                                |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > A formal claim on a *VA Form 10-1394, Application for |
|  b. Applyi | > Adaptive Equipment -- Motor Vehicle* is required if   |
| ng for Ada | > the veteran is entitled to adaptive equipment only.   |
| ptive Equi | > Typically this form is provided by the outpatient     |
| pment Only | > clinic to the veteran for forwarding to finance       |
|            | > activity, or submitted by the prosthetics department  |
|            | > on his/her behalf to the local finance activity.      |
|            | >                                                       |
|            | > A *VA Form 10-1394* is also required for approval of  |
|            | > equipment not specified on the *VA Form 21-4502* for  |
|            | > the veteran's particular disability.                  |
|            | >                                                       |
|            | > ***Note***: There is no time limit for filing a claim |
|            | > for adaptive equipment based on ankylosis.            |
+------------+---------------------------------------------------------+

Continued on next page

2\. Application for Automobile and Adaptive Equipment Allowance,
Continued

+------------+---------------------------------------------------------+
| #          | > If an application from a person on active duty is     |
| #### c. Ha | > incomplete in any essential part or the medical       |
| ndling Inc | > evidence or service status is insufficiently          |
| omplete Ap | > documented                                            |
| plications |                                                         |
|            | -   · return the application to the VA prosthetics      |
|            |     department, if it is responsible for the            |
|            |     deficiency; otherwise                               |
|            |                                                         |
|            | -   · advise the servicemember of the deficiency, and   |
|            |                                                         |
|            | -   · ask him/her to obtain the necessary evidence.     |
+------------+---------------------------------------------------------+

#### 3. Rating Claims for Automobile and Adaptive Equipment Allowance

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on rating claims for  |
| troduction | > automobile or adaptive equipment allowance, including |
|            | > information on                                        |
|            |                                                         |
|            | -   · referring claims to the rating activity           |
|            |                                                         |
|            | -   · when to prepare a rating decision, and            |
|            |                                                         |
|            | -   · the rating conclusion.                            |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### a.   | > If prior rating decisions do *not* establish the      |
|  Referring | > existence of qualifying SC disability, refer the      |
|  Claims to | > claim to the rating activity after any necessary      |
|  the Ratin | > development.                                          |
| g Activity | >                                                       |
|            | > ***Result***: If a claim for other VA benefits has    |
|            | > not been filed, the rating activity prepares a        |
|            | > memorandum rating.                                    |
|            | >                                                       |
|            | > ***Reference***: For more information on preparing a  |
|            | > memorandum rating, see M21-1MR, Part IX, Subpart ii,  |
|            | > 2.1 (TBD) or M21-1, Part VI, Chapter 4.08.            |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##         | > Prepare a rating decision whenever                    |
| ### b. Whe |                                                         |
| n to Prepa | -   · a claim for automobile or adaptive equipment is   |
| re a Ratin |     received from a veteran or a serviceperson and the  |
| g Decision |     issue has not been previously considered, or        |
|            |                                                         |
|            | -   · the issue of eligibility for automobile or        |
|            |     adaptive equipment is inferred from a disability    |
|            |     rating that fulfills the applicable disability      |
|            |     criteria.                                           |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### c. T | > RBA 2000 will generate the codesheet with the         |
| he Rating  | > decision(s) regarding entitlement to automobile and   |
| Conclusion | > adaptive equipment or adaptive equipment only, on all |
|            | > original or reopened claims where the requirements of |
|            | > 38 U.S.C. 3901 (38 CFR 3.808(b)) or 38 U.S.C.         |
|            | > 3902(b)(2) are initially met.                         |
+------------+---------------------------------------------------------+

#### 4. Notifying Claimants

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on notifying          |
| troduction | > claimants of awards and denials, including            |
|            | > information on                                        |
|            |                                                         |
|            | -   · potential eligibility, and                        |
|            |                                                         |
|            | -   · the reason for the denial.                        |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ###        | > Use the table below to inform the claimant of         |
| ## a. Noti | > potential eligibility after receiving the rating      |
| fying Clai | > decision.                                             |
| mants of P |                                                         |
| otential E |                                                         |
| ligibility |                                                         |
+------------+---------------------------------------------------------+

+----------------------------------+-----------------------------------+
| If the veteran or serviceperson  | Then ...                          |
| is eligible for ...              |                                   |
+----------------------------------+-----------------------------------+
| the automobile allowance         | -   · furnish *VA Form 21-4502*   |
|                                  |     in duplicate, if one is not   |
|                                  |     of record, and                |
|                                  |                                   |
|                                  | -   · instruct the claimant to    |
|                                  |     complete and return both      |
|                                  |     copies of the form.           |
+----------------------------------+-----------------------------------+
| adaptive equipment only          | -   · furnish *VA Form 10-1394*,  |
|                                  |     if available, and             |
|                                  |                                   |
|                                  | -   · instruct the claimant to    |
|                                  |                                   |
|                                  | ```{=html}                        |
|                                  | <!-- -->                          |
|                                  | ```                               |
|                                  | -   \- complete all items in      |
|                                  |     Section I, except items 5 and |
|                                  |     6                             |
|                                  |                                   |
|                                  | -   \- specify the disability     |
|                                  |     upon which the claim is based |
|                                  |     in item 7E, and               |
|                                  |                                   |
|                                  | -   \- return the completed form  |
|                                  |     to the nearest VA medical     |
|                                  |     facility.                     |
|                                  |                                   |
|                                  | ***Note***: If *VA Form 10-1394*  |
|                                  | is not available, refer the       |
|                                  | claimant to the nearest VA        |
|                                  | prosthetics department.           |
+----------------------------------+-----------------------------------+

Continued on next page

4\. Notifying Claimants, Continued

+------------+---------------------------------------------------------+
| ###        | > If an application is *not* approved, fully inform the |
| ## b. Noti | > claimant of the                                       |
| fying Clai |                                                         |
| mants of t | -   · evidence considered, and                          |
| he Reason  |                                                         |
| for Denial | -   · reason for denial.                                |
|            |                                                         |
|            | > ***Reference***: For more information on notice of    |
|            | > disagreements (NODs), see M21-1MR, Part IX, Subpart   |
|            | > i, 2.7.                                               |
+------------+---------------------------------------------------------+

#### 5. Processing Claims for Automobile and Adaptive Equipment Allowance

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on processing claims  |
| troduction | > for automobile and adaptive equipment allowance,      |
|            | > including information on                              |
|            |                                                         |
|            | -   · making a favorable determination of entitlement   |
|            |                                                         |
|            | -   · applying for "other" types of conveyance          |
|            |                                                         |
|            | -   · processing applications for "other" types of      |
|            |     conveyance                                          |
|            |                                                         |
|            | -   · releasing *VA Form 21-4502* and *VA Form 10-1394* |
|            |     to the applicant for a conveyance                   |
|            |                                                         |
|            | -   · processing a completed *VA Form 21-4502* to       |
|            |     determine if prior payment has been made            |
|            |                                                         |
|            | -   · entitlement based on vehicle lease, and           |
|            |                                                         |
|            | -   · determining whether the vehicle is purchased or   |
|            |     leased.                                             |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### a    | > Follow the steps in the table below when the          |
| . Favorabl | > entitlement criteria of 38 CFR 3.808 are met as       |
| e Determin | > confirmed by the rating decision and a *VA Form       |
| ation of E | > 21-4502* with Section I, *Application*, completed by  |
| ntitlement | > the veteran.                                          |
+------------+---------------------------------------------------------+

+-------+--------------------------------------------------------------+
| Step  | Action                                                       |
+-------+--------------------------------------------------------------+
| 1     | Complete *VA Form 21-4502*, Section II, *Certificate of      |
|       | Eligibility* by entering all the qualifying disabilities.    |
+-------+--------------------------------------------------------------+
| 2     | Have *VA Form 21-4502* signed by the Veterans Service Center |
|       | Manager (VSCM) or by a designee no lower than coach.         |
+-------+--------------------------------------------------------------+
| 3     | Release the original *VA Form 21-4502* to the applicant      |
|       | unless referral to an outpatient clinic is required.         |
|       |                                                              |
|       | ***Reference***: For more information on the requirement of  |
|       | referring claims to an outpatient clinic, see M21-1MR, Part  |
|       | IX, Subpart i, 2.6.f.                                        |
+-------+--------------------------------------------------------------+
| 4     | Place a copy of the form in the claims folder.               |
+-------+--------------------------------------------------------------+

Continued on next page

5\. Processing Claims for Automobile and Adaptive Equipment Allowance,
Continued

+------------+---------------------------------------------------------+
| ##### b.   | > Prior to taking any action on the application, if the |
| Applying f | > Type of Conveyance Applied For field on *VA Form      |
| or "Other" | > 21-4502* is checked "Other," make a determination of  |
|  Types of  | > approval or disapproval of the type of conveyance in  |
| Conveyance | > the form of an administrative decision in the format  |
|            | > prescribed in M21-1MR, Part III, Subpart v, 1.A.2     |
|            | > (TBD) or M21-1, Part IV, Chapter 11.30 for the        |
|            | > approval of the VSCM or a designee not lower than a   |
|            | > coach.                                                |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > Follow the steps in the table below when the          |
|  c. Proces | > applicant is found eligible for a conveyance other    |
| sing Appli | > than an automobile or similar vehicle and has         |
| cations fo | > submitted a VA Form 21-4502 with Section I,           |
| r "Other"  | > *Application*, completed.                             |
| Types of C |                                                         |
| onveyances |                                                         |
+------------+---------------------------------------------------------+

  -------- --------------------------------------------------------------
  Step     Action

  1        Complete and approve Section II, *Certificate of Eligibility*,
           of *VA Form 21-4502*.

  2        Refer the form to the outpatient clinic with a copy of the
           rating decision.

  3        Annotate the copy of *VA Form 21-4502* to show the date and
           place of referral.

  4        File a copy of *VA Form 21-4502* in the claims folder.
  -------- --------------------------------------------------------------

+------------+---------------------------------------------------------+
| #          | > After determination of any adaptive equipment for a   |
| #### d. Re | > conveyance other than an automobile or similar        |
| leasing VA | > vehicle, the outpatient clinic must release *VA Form  |
|  Forms 21- | > 21-4502* and supplemental authorization on *VA Form   |
| 4502 and 1 | > 10-1394* to the applicant. The applicant must send    |
| 0-1394 to  | > the forms to finance activity for payment.            |
| the Applic |                                                         |
| ant for a  |                                                         |
| Conveyance |                                                         |
+------------+---------------------------------------------------------+

Continued on next page

5\. Processing Claims for Automobile and Adaptive Equipment Allowance,
Continued

+------------+---------------------------------------------------------+
| ##### e    | > Follow the steps in the table below to process a      |
| . Processi | > completed *VA Form 21-4502* (Sections I, II, and III) |
| ng Complet | > and determine if prior payment was made.              |
| ed VA Form |                                                         |
|  21-4502 a |                                                         |
| nd Determi |                                                         |
| ning if Pr |                                                         |
| ior Paymen |                                                         |
| t Was Made |                                                         |
+------------+---------------------------------------------------------+

+-------+--------------------------------------------------------------+
| Step  | Action                                                       |
+-------+--------------------------------------------------------------+
| 1     | Review *VA Form 21-4502* with the claims folder to determine |
|       | if the veteran or serviceperson is entitled.                 |
+-------+--------------------------------------------------------------+
| 2     | Is the veteran or serviceperson entitled?                    |
|       |                                                              |
|       | -   · If *yes*                                               |
|       |                                                              |
|       | ```{=html}                                                   |
|       | <!-- -->                                                     |
|       | ```                                                          |
|       | -   \- review the Benefits Delivery Network (BDN)/Share M15  |
|       |     screen to determine if prior payment has been made, and  |
|       |                                                              |
|       | -   \- go to Step 3.                                         |
|       |                                                              |
|       | ```{=html}                                                   |
|       | <!-- -->                                                     |
|       | ```                                                          |
|       | -   · If *no*, refer the claim to the rating activity for    |
|       |     consideration.                                           |
+-------+--------------------------------------------------------------+
| 3     | Is "*Y*" displayed in the Auto Allowance Paid field and      |
|       |                                                              |
|       | the terminal digit of the year in which the last payment was |
|       | made displayed in the Auto Adaptive Equipment field?         |
|       |                                                              |
|       | -   · If *yes,* go to Step 4.                                |
|       |                                                              |
|       | -   · If *no*, forward the application to finance activity.  |
+-------+--------------------------------------------------------------+
| 4     | Does the claims folder contain a copy of *VA Form 21-4502*   |
|       | annotated by the finance activity indicating payment?        |
|       |                                                              |
|       | -   · If *yes*, and a prior payment was made, go to Step 5.  |
|       |                                                              |
|       | -   · If *no*, forward the file to finance activity to       |
|       |     determine the date of prior payment and the identity of  |
|       |     the regional office (RO) that processed it.              |
+-------+--------------------------------------------------------------+

Continued on next page

5\. Processing Claims for Automobile and Adaptive Equipment Allowance,
Continued

  -----------------------------------------------------------------------
  e\. Processing Completed VA Form 21-4502 and Determining if Prior
  Payment Was Made (continued)

  -----------------------------------------------------------------------

+-------+--------------------------------------------------------------+
| Step  | Action                                                       |
+-------+--------------------------------------------------------------+
| 5     | If the claim is for                                          |
|       |                                                              |
|       | -   · the automobile or conveyance                           |
|       |                                                              |
|       | ```{=html}                                                   |
|       | <!-- -->                                                     |
|       | ```                                                          |
|       | -   \- prior payment disqualifies the application, and       |
|       |                                                              |
|       | -   \- inform the veteran accordingly, and                   |
|       |                                                              |
|       | ```{=html}                                                   |
|       | <!-- -->                                                     |
|       | ```                                                          |
|       | -   · adaptive equipment                                     |
|       |                                                              |
|       | ```{=html}                                                   |
|       | <!-- -->                                                     |
|       | ```                                                          |
|       | -   \- prior payment does *not* necessarily disqualify the   |
|       |     application, and                                         |
|       |                                                              |
|       | -   \- forward the claim to finance activity.                |
+-------+--------------------------------------------------------------+

+------------+---------------------------------------------------------+
| ###        | > The transfer of possession of a vehicle under a       |
| ## f. Enti | > contract amounting to a lease does *not* qualify for  |
| tlement Ba | > the automobile allowance under 38 U.S.C. 3902(a).     |
| sed on Veh |                                                         |
| icle Lease |                                                         |
+------------+---------------------------------------------------------+

Continued on next page

5\. Processing Claims for Automobile and Adaptive Equipment Allowance,
Continued

+------------+---------------------------------------------------------+
| ###        | > Use the table below to determine whether the vehicle  |
| ## g. Dete | > is purchased or leased.                               |
| rmining Wh |                                                         |
| ether the  |                                                         |
| Vehicle Is |                                                         |
|  Purchased |                                                         |
|  or Leased |                                                         |
+------------+---------------------------------------------------------+

+----------------------------------+-----------------------------------+
| When the ...                     | Then the agreement is a ...       |
+----------------------------------+-----------------------------------+
| veteran and vendor are           | purchase.                         |
| absolutely bound at the outset   |                                   |
| to a purchase and sale           |                                   |
+----------------------------------+-----------------------------------+
| -   · veteran                    | lease.                            |
|                                  |                                   |
| ```{=html}                       |                                   |
| <!-- -->                         |                                   |
| ```                              |                                   |
| -   \- retains the option of     |                                   |
|     considering the payments as  |                                   |
|     rent, and                    |                                   |
|                                  |                                   |
| -   \- is not obligated to       |                                   |
|     purchase the vehicle at the  |                                   |
|     end of the lease period, or  |                                   |
|                                  |                                   |
| ```{=html}                       |                                   |
| <!-- -->                         |                                   |
| ```                              |                                   |
| -   · dealer retains the right   |                                   |
|     to take the car back even    |                                   |
|     after the veteran meets all  |                                   |
|     the payments due             |                                   |
+----------------------------------+-----------------------------------+

#### 6. Processing and Paying Eligibility Requests and Certificates of Eligibility

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on processing and     |
| troduction | > paying eligibility requests and certificates of       |
|            | > eligibility, including information on                 |
|            |                                                         |
|            | -   · making payment if the vehicle was purchased       |
|            |     before adjudicative action established eligibility  |
|            |                                                         |
|            | -   · receiving eligibility requests for vehicles       |
|            |     acquired prior to receipt of allowance              |
|            |                                                         |
|            | -   · processing eligibility requests for vehicles      |
|            |     acquired prior to receipt of allowance              |
|            |                                                         |
|            | -   · finance activity's recording and reporting on     |
|            |     claims                                              |
|            |                                                         |
|            | -   · preventing duplicate payment, and                 |
|            |                                                         |
|            | -   · referring adaptive equipment claims to the        |
|            |     finance activity.                                   |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > Ordinarily, an application on *VA Form 21-4502* is    |
| a. Payment | > completed and approved by authorization activity to   |
|  if the Ve | > certify eligibility before the claimant takes         |
| hicle was  | > possession of, or title to, the vehicle.              |
| Purchased  | >                                                       |
| Before Adj | > However, payment of the automobile allowance is *not* |
| udicative  | > precluded if the vehicle was purchased before the     |
| Action Est | > adjudicative action establishing eligibility,         |
| ablished E | > provided the claimant was actually eligible on the    |
| ligibility | > date on which the claimant signed the sales contract. |
|            | > The claimant's eligibility is controlled by the       |
|            | > effective date of the qualifying disability.          |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #          | > The Veterans Service Center (VSC) receives requests   |
| #### b. Re | > in duplicate for eligibility data for reimbursement   |
| ceiving El | > of adaptive equipment for a vehicle acquired prior to |
| igibility  | > receipt of the automobile allowance from the medical  |
| Requests f | > center or outpatient clinic.                          |
| or Vehicle | >                                                       |
| s Acquired | > The request identifies the claimant and the reason    |
|  Prior to  | > for the request.                                      |
| Receipt of | >                                                       |
|  Allowance | > ***Example***: *"Was claimant eligible under 38       |
|            | > U.S.C. 3902 on* **\[Date expense was incurred for     |
|            | > purchase, installation, repair, or reinstallation of  |
|            | > adaptive equipment\]***?*"                            |
+------------+---------------------------------------------------------+

Continued on next page

6\. Processing and Paying Eligibility Requests and Certificates of
Eligibility, Continued

+------------+---------------------------------------------------------+
| ##         | > After receiving eligibility requests for vehicles     |
| ### c. Pro | > acquired prior to receipt of the automobile           |
| cessing El | > allowance, use the table below to determine           |
| igibility  | > eligibility.                                          |
| Requests f |                                                         |
| or Vehicle |                                                         |
| s Acquired |                                                         |
|  Prior to  |                                                         |
| Receipt of |                                                         |
|  Allowance |                                                         |
+------------+---------------------------------------------------------+

+----------------------------------+-----------------------------------+
| If ...                           | Then ...                          |
+----------------------------------+-----------------------------------+
| the claimant has *not*           | determine basic eligibility as    |
| previously filed a claim for the | described in M21-1MR, Part IX,    |
| automobile allowance and         | Subpart i, 2.1.                   |
| adaptive equipment               |                                   |
+----------------------------------+-----------------------------------+
| -   · there is evidence of       | -   · determine the eligibility   |
|     entitlement or               |     of the claimant for an        |
|     nonentitlement on record, or |     automobile allowance on the   |
|                                  |     date furnished by the medical |
| -   · a determination of basic   |     facility                      |
|     eligibility has already been |                                   |
|     made                         | -   · annotate the request form   |
|                                  |     to show *"Claimant (was) (was |
|                                  |     not) eligible on* **\[date    |
|                                  |     furnished by the medical      |
|                                  |     facility\]***"*               |
|                                  |                                   |
|                                  | -   · file the copy of the        |
|                                  |     eligibility request in the    |
|                                  |     claims folder, and            |
|                                  |                                   |
|                                  | -   · return the original to the  |
|                                  |     requester.                    |
+----------------------------------+-----------------------------------+
| > a request for eligibility for  | > review the claims folder to     |
| > adaptive equipment only is     | > determine if the veteran is     |
| > received (based on SC          | > entitled.                       |
| > ankylosis)                     |                                   |
|                                  | -   · If the veteran is entitled, |
|                                  |     annotate the request to show  |
|                                  |                                   |
|                                  | ```{=html}                        |
|                                  | <!-- -->                          |
|                                  | ```                               |
|                                  | -   \- eligibility because of SC  |
|                                  |     ankylosis (loss of use) of    |
|                                  |     one or both knees or hips, or |
|                                  |                                   |
|                                  | -   \- that the veteran is not    |
|                                  |     eligible, and                 |
|                                  |                                   |
|                                  | ```{=html}                        |
|                                  | <!-- -->                          |
|                                  | ```                               |
|                                  | -   · if eligibility is *not*     |
|                                  |     established, furnish a copy   |
|                                  |     of the rating decision.       |
+----------------------------------+-----------------------------------+

Continued on next page

6\. Processing and Paying Eligibility Requests and Certificates of
Eligibility, Continued

+------------+---------------------------------------------------------+
| ###        | > When the original *VA Form 21-4502* with Section III  |
| ## d. Fina | > completed by the claimant is returned and scheduled   |
| nce Activi | > for payment, the finance activity                     |
| ty Respons |                                                         |
| ibility to | -   · prominently annotates the copy of the application |
|  Record an |     in the claims folder to show the                    |
| d Report t |                                                         |
| he Payment | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   \- date                                             |
|            |                                                         |
|            | -   \- amount authorized for payment, and               |
|            |                                                         |
|            | -   \- initials of the voucher auditor                  |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   · records the payment in the master record, and     |
|            |                                                         |
|            | -   · forwards a copy of the completed *VA Form         |
|            |     21-4502* to the outpatient clinic of jurisdiction.  |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### e    | > The VSC permanently retains the annotated copy of *VA |
| . Preventi | > Form 21-4502* in the award section of the claims      |
| ng Duplica | > folder to prevent duplicate payment in the event a    |
| te Payment | > subsequent claim is received.                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### f.   | > Refer all claims for adaptive equipment to the        |
|  Referring | > finance activity. It will determine if the adaptive   |
|  Adaptive  | > equipment is preapproved for reimbursement based upon |
| Equipment  | > the effective date of entitlement, the veteran's SC   |
| Claims to  | > disability, or if it is specifically authorized by    |
| the Financ | > the local VA outpatient clinic. If it is not, then    |
| e Activity | > the finance activity will forward the claim to the    |
|            | > outpatient clinic serving the applicant\'s residence. |
|            | > The designee of the Chief Medical Director will       |
|            | > consider the claim. The prosthetic department will    |
|            | > signify its approval by completing *VA Form 10-1394*. |
|            | > This form is then returned to finance for payment.    |
|            | >                                                       |
|            | > These claims may be independent of any initial        |
|            | > application for an automobile, and may involve        |
|            | > repair, replacement, or reinstallation of adaptive    |
|            | > equipment.                                            |
+------------+---------------------------------------------------------+

#### 7. Processing Notice of Disagreements (NODs) or Substantive Appeal

+------------+---------------------------------------------------------+
| ##### C    | > November 16, 2004                                     |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### a.   | > Use the table below to determine the next steps when  |
|  Processin | > the claimant files an NOD or substantive appeal       |
| g an NOD o | > relating to the denial of a claim for automobile and  |
| r Substant | > adaptive equipment allowance.                         |
| ive Appeal |                                                         |
+------------+---------------------------------------------------------+

+----------------------------------+-----------------------------------+
| If ...                           | Then ...                          |
+----------------------------------+-----------------------------------+
| the disallowance resulted from   | authorization furnishes the       |
| the denial of basic eligibility  | statement of the case (SOC) and   |
|                                  | certifies the appeal when the     |
|                                  | substantive appeal is received.   |
+----------------------------------+-----------------------------------+
| -   · the claimant has           | -   · authorization transfers the |
|     established basic            |     claims folder to the medical  |
|     eligibility to the           |     facility for preparation of   |
|     automobile allowance and     |     an SOC, and                   |
|     adaptive equipment, and      |                                   |
|                                  | -   · the medical facility        |
| -   · the issue is the result of |     returns the SOC and claims    |
|     disallowance by the medical  |     folder to authorization for   |
|     activity for certain         |     release of the SOC.           |
|     adaptive equipment           |                                   |
+----------------------------------+-----------------------------------+
| a substantive appeal is filed    | authorization forwards the claims |
| because of disallowance by the   | folder to the medical activity    |
| medical activity                 | for processing and certification  |
|                                  | of the appeal.                    |
+----------------------------------+-----------------------------------+