### Section A. General Authorization and Claimant Notification Issues

#### Overview

+------------+---------------------------------------------------------+
| #          | > This section contains the following topics:           |
| #### In th |                                                         |
| is Section |                                                         |
+------------+---------------------------------------------------------+

  ------------ ---------------------------------------------- ------------
  Topic        Topic Name                                     See Page

  1            Locations of Information Pertaining to General 3-A-2
               Authorization and Claimant Notification Issues 

  2            Reduction or Discontinuance of Compensation    3-A-4
               Resulting From Clear and Unmistakable Error or 
               Severance of Service Connection                

  3            Reductions in Disability Evaluations Under 38  3-A-13
               CFR 3.105(e)                                   

  4            Awards Under Graduated Tuberculosis (TB)       3-A-23
               Ratings                                        
  ------------ ---------------------------------------------- ------------

#### 1. Locations of Information Pertaining to General Authorization and Claimant Notification Issues

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on the locations of   |
| troduction | > information pertaining to general authorization and   |
|            | > claimant notification issues. It includes the         |
|            | > locations of information on                           |
|            |                                                         |
|            | -   the award and denial process                        |
|            |                                                         |
|            | -   due process                                         |
|            |                                                         |
|            | -   effective dates for new awards and increases        |
|            |                                                         |
|            | -   compensation for an adult helpless child            |
|            |                                                         |
|            | -   Special Monthly Compensation (SMC), and             |
|            |                                                         |
|            | -   potential entitlement to vocational rehabilitation. |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > September 29, 2006                                    |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ###        | > For more information on the award and denial process, |
| ## a. Awar | > see M21-1MR, Part III, Subpart v, 2.                  |
| d and Deni |                                                         |
| al Process |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### b. D | > For general information on due process, see M21-1MR,  |
| ue Process | > Part I, 2.A.                                          |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ###        | > For information on effective dates for new awards and |
| ## c. Effe | > increases, see                                        |
| ctive Date |                                                         |
| s for New  | -   [38 U.S.C.                                          |
| Awards and |     5110](http://straylight.law.cornell.edu             |
|  Increases | /uscode/html/uscode38/usc_sec_38_00005110----000-.html) |
|            |                                                         |
|            | -   [38 CFR                                             |
|            |     3.157](http://                                      |
|            | www.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_157.DOC) |
|            |                                                         |
|            | -   [38 CFR                                             |
|            |     3.400](http://w                                     |
|            | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_400.DOC), |
|            |     and                                                 |
|            |                                                         |
|            | -   [38 CFR                                             |
|            |     3.401](http://w                                     |
|            | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_401.DOC). |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### d.   | > For information on compensation for an adult helpless |
| Compensati | > child, see M21-1MR, Part III, Subpart iii, 7.3 (TBD)  |
| on for an  | > or [M21-1, Part IV,                                   |
| Adult Help | > 15.04](htt                                            |
| less Child | p://www.warms.vba.va.gov/admin21/m21_1/part4/ch15.doc). |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##         | > For information on Special Monthly Compensation       |
| ### e. SMC | > (SMC), see                                            |
|            |                                                         |
|            | -   M21-1MR, Part IV, Subpart ii, 2.H, and              |
|            |                                                         |
|            | -   M21-1MR, Part IV, Subpart ii, 2.I.                  |
+------------+---------------------------------------------------------+

Continued on next page

1\. Locations of Information Pertaining to General Authorization and
Claimant Notification Issues, Continued

+------------+---------------------------------------------------------+
| ##### f.   | > For information on notifying veterans of potential    |
| Potential  | > entitlement to vocational rehabilitation under [38    |
| Entitlemen | > U.S.C. Chapter                                        |
| t to Vocat | > 31](http://assembler.law.cornell.edu                  |
| ional Reha | /uscode/html/uscode38/usc_sup_01_38_10_III_20_31.html), |
| bilitation | > see M21-1MR, Part IX, Subpart i, 1.A.6.               |
+------------+---------------------------------------------------------+

#### 2. Reduction or Discontinuance of Compensation Resulting From Clear and Unmistakable Error or Severance of Service Connection 

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on reduction or       |
| troduction | > discontinuance of compensation resulting from clear   |
|            | > and unmistakable error (CUE) or severance of service  |
|            | > connection. It includes information on                |
|            |                                                         |
|            | -   rating activity action to reduce an evaluation      |
|            |     based on CUE                                        |
|            |                                                         |
|            | -   who has authority to sign the rating decision       |
|            |                                                         |
|            | -   the location of relevant information pertaining to  |
|            |     this topic                                          |
|            |                                                         |
|            | -   withdrawing a proposal to reduce an evaluation      |
|            |     under 38 CFR 3.105(a)                               |
|            |                                                         |
|            | -   the jurisdiction of the rating activity over        |
|            |     severance of service connection                     |
|            |                                                         |
|            | -   the jurisdiction of the authorization activity over |
|            |     severance of service connection                     |
|            |                                                         |
|            | -   the responsibility of the Veterans Service Center   |
|            |     Manager (VSCM)                                      |
|            |                                                         |
|            | -   due process periods and effective dates             |
|            |                                                         |
|            | -   the process to sever service connection after VSCM  |
|            |     approval                                            |
|            |                                                         |
|            | -   what to include in the notice of proposed adverse   |
|            |     action                                              |
|            |                                                         |
|            | -   the effective dates in a decision to sever service  |
|            |     connection                                          |
|            |                                                         |
|            | -   the action to take on a rating decision to sever    |
|            |     service connection under 38 CFR 3.105(a), and       |
|            |                                                         |
|            | -   notification of Chapter 31 Vocational               |
|            |     Rehabilitation and Employment (VR&E) and Veterans   |
|            |     Health Administration (VHA).                        |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > September 29, 2006                                    |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### a.   | > When the reduction or discontinuance of a veteran's   |
|  Rating Ac | > compensation results from a finding of clear and      |
| tivity Act | > unmistakable error (CUE) in the determination of the  |
| ion to Red | > disability evaluation, the rating activity prepares a |
| uce an Eva | > rating that                                           |
| luation Ba |                                                         |
| sed on CUE | -   proposes the change                                 |
|            |                                                         |
|            | -   cites all the material facts and justification for  |
|            |     the proposed action, and                            |
|            |                                                         |
|            | -   includes the                                        |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   legend "PROPOSAL TO REDUCE UNDER 38 CFR 3.105(a)    |
|            |     and 3.105(e)"                                       |
|            |                                                         |
|            | -   proposed evaluation of the disability in question,  |
|            |     and                                                 |
|            |                                                         |
|            | -   proposed combined evaluation, if applicable.        |
|            |                                                         |
|            | > ***Reference***: For the regulation governing CUE,    |
|            | > see [38 CFR                                           |
|            | > 3.105(a)](http://w                                    |
|            | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC). |
+------------+---------------------------------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| ####       | > The rating decision proposing reduction or            |
| # b. Who H | > discontinuance of benefits under [38 CFR              |
| as Authori | > 3.105(a)](http://                                     |
| ty to Sign | www.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC) |
|  the Ratin | > must be signed by the Veterans Service Center Manager |
| g Decision | > (VSCM) or a supervisory designee no lower than coach. |
|            | >                                                       |
|            | > The final rating decision does not require the        |
|            | > signature or approval of the VSCM or VSCM-designee    |
|            | > unless new evidence has been received since the       |
|            | > proposed decision was approved.                       |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##         | > Use the information in M21-1MR, Part IV, Subpart ii,  |
| ### c. Loc | > 3.A.3 when                                            |
| ation of P |                                                         |
| ertinent I | -   determining the effective date                      |
| nformation |                                                         |
|            | -   considering                                         |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   the submission of evidence, and                     |
|            |                                                         |
|            | -   hearing requests, and                               |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   notifying the veteran.                              |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### d.   | > The actions required to withdraw a proposal to reduce |
|  Withdrawi | > an evaluation resulting from CUE depend upon who      |
| ng a Propo | > withdraws the proposal.                               |
| sal to Red | >                                                       |
| uce an Eva | > Use the information below to determine the action to  |
| luation Ba | > take to withdraw a proposal to reduce an evaluation   |
| sed on CUE | > under [38 CFR                                         |
|            | > 3.105(a)](http://w                                    |
|            | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC). |
+------------+---------------------------------------------------------+

+-----------------------------------+-----------------------------------+
| If the ...                        | Then the ...                      |
+-----------------------------------+-----------------------------------+
| rating activity withdraws the     | -   rating activity prepares a    |
| proposal to reduce an evaluation  |     rating decision that confirms |
|                                   |     and continues (C&C rating)    |
|                                   |     the prior evaluation, and     |
|                                   |                                   |
|                                   | -   VSCM or designee *must*       |
|                                   |     approve the C&C rating.       |
+-----------------------------------+-----------------------------------+
| Decision Review Officer (DRO)     | -   DRO prepares a DRO decision,  |
| withdraws the proposal to reduce  |     and                           |
| an evaluation                     |                                   |
|                                   | -   VSCM or designee *must*       |
|                                   |     approve the DRO decision,     |
|                                   |     *unless* it is an issue on    |
|                                   |     appeal.                       |
+-----------------------------------+-----------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| ##### e    | > As indicated in M21-1MR, Part III, Subpart iv,        |
| . Jurisdic | > 8.E.17, the rating activity typically initiates       |
| tion of Ra | > action to sever service connection. However,          |
| ting Activ | > authorization activity may do so in certain           |
| ity Over S | > circumstances per M21-1MR, Part IV, Subpart ii,       |
| everance o | > 3.A.2.f.                                              |
| f Service  | >                                                       |
| Connection | > The rating activity may reverse a previous award of   |
|            | > service connection under [38 CFR                      |
|            | > 3.105(d)](http://                                     |
|            | www.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC) |
|            | > if it finds that service connection was awarded based |
|            | > on CUE. This means that the original grant had no     |
|            | > plausible basis in the law or particular facts of the |
|            | > case. The error must be undebatable and not a mere    |
|            | > difference in judgment between decision-makers.       |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### f.   | > The authorization activity                            |
|  Jurisdict |                                                         |
| ion of the | -   initiates action to sever service connection if a   |
|  Authoriza |     CUE was made in a decision concerning               |
| tion Activ |                                                         |
| ity Over S | ```{=html}                                              |
| everance o | <!-- -->                                                |
| f Service  | ```                                                     |
| Connection | -   character of discharge                              |
|            |                                                         |
|            | -   line of duty, or                                    |
|            |                                                         |
|            | -   willful misconduct, and                             |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   refers the case to the rating activity for          |
|            |     appropriate action under M21-1MR, Part III, Subpart |
|            |     iv, 8.E.18.                                         |
|            |                                                         |
|            | > ***Note***: Take action as shown in M21-1MR, Part     |
|            | > III, Subpart iv, 8.E.17 even if severance of service  |
|            | > connection would not result in a reduction or         |
|            | > termination of benefits.                              |
|            | >                                                       |
|            | > ***References***: For more information on decisions   |
|            | > concerning                                            |
|            |                                                         |
|            | -   character of discharge, see M21-1MR, Part III,      |
|            |     Subpart v, 1.B                                      |
|            |                                                         |
|            | -   line of duty, see M21-1MR, Part III, Subpart v,     |
|            |     1.D, and                                            |
|            |                                                         |
|            | -   willful misconduct, see M21-1MR, Part III, Subpart  |
|            |     v, 1.D.                                             |
+------------+---------------------------------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| #####      | > As indicated in M21-1MR, Part III, Subpart iv,        |
|  g. Respon | > 8.E.17, the VSCM *must* approve any proposal to sever |
| sibility o | > service connection.                                   |
| f the VSCM | >                                                       |
|            | > ***Important***: Do *not* inform the veteran or       |
|            | > veteran's power of attorney (POA) of a proposed       |
|            | > severance before it is approved by the VSCM.          |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### h.   | > Department of Veterans Affairs (VA) is required to    |
|  Due Proce | > provide the veteran 60 days                           |
| ss Periods |                                                         |
|  and Effec | -   to respond to the notice of proposed reduction or   |
| tive Dates |     discontinuance of benefits (referred to as the "due |
|            |     process" period), and                               |
|            |                                                         |
|            | -   after a final decision is made and final notice is  |
|            |     sent before effectuating the reduction or           |
|            |     discontinuance.                                     |
+------------+---------------------------------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| ####       | > The table below describes the process to sever        |
| # i. Proce | > service connection after VSCM approval.               |
| ss to Seve |                                                         |
| r Service  |                                                         |
| Connection |                                                         |
|  After VSC |                                                         |
| M Approval |                                                         |
+------------+---------------------------------------------------------+

+-----+-----------------+---------------------------------------------+
| St  | Who Is          | Description                                 |
| age | Responsible     |                                             |
+-----+-----------------+---------------------------------------------+
| 1   | Authorization   | -   Sends the notice of proposed adverse    |
|     | activity        |     action to the veteran                   |
|     |                 |                                             |
|     |                 | -   continues the existing end product (EP) |
|     |                 |     control, and                            |
|     |                 |                                             |
|     |                 | -   establishes an EP 600 with a suspense   |
|     |                 |     date 65 days from the date the notice   |
|     |                 |     is released.                            |
|     |                 |                                             |
|     |                 | ***Reference***: For the information to     |
|     |                 | include in the notice of proposed adverse   |
|     |                 | action, see M21-1MR, Part IV, Subpart ii,   |
|     |                 | 3.A.2.k.                                    |
+-----+-----------------+---------------------------------------------+
| 2   | Authorization   | Refers the case to the rating activity      |
|     | activity        |                                             |
|     |                 | -   as soon as the veteran submits evidence |
|     |                 |     within the time allowed for a response  |
|     |                 |     in accordance with M21-1MR, Part III,   |
|     |                 |     Subpart iv, 8.E.17.g, or                |
|     |                 |                                             |
|     |                 | -   at the end of the time period allowed   |
|     |                 |     for a response if the veteran does      |
|     |                 |     *not* submit any evidence.              |
+-----+-----------------+---------------------------------------------+
| 3   | Rating activity | -   Makes a determination                   |
|     |                 |                                             |
|     |                 | -   prepares a final rating decision, and   |
|     |                 |                                             |
|     |                 | -   forwards the decision to the            |
|     |                 |     authorization activity for action.      |
+-----+-----------------+---------------------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| ##         | > After the VSCM approves a proposal to sever service   |
| ### j. Inf | > connection, notify the veteran by a locally-generated |
| ormation t | > letter of the proposed adverse action. The letter     |
| o Include  | > must                                                  |
| in the Not |                                                         |
| ice of Pro | -   thoroughly explain the                              |
| posed Adve |                                                         |
| rse Action | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   proposed action                                     |
|            |                                                         |
|            | -   reason for it, and                                  |
|            |                                                         |
|            | -   proposed effective date per M21-1MR, Part IV,       |
|            |     Subpart ii, 3.A.2.k                                 |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   contain statements concerning the veteran's rights  |
|            |     to                                                  |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   present evidence                                    |
|            |                                                         |
|            | -   request a hearing, and                              |
|            |                                                         |
|            | -   have representation                                 |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   advise the veteran that the present payment will    |
|            |     continue during the time allowed for him/her to     |
|            |     exercise those rights                               |
|            |                                                         |
|            | -   include information concerning possible pension     |
|            |     entitlement *if* the evidence shows such            |
|            |     entitlement may exist, and                          |
|            |                                                         |
|            | -   request any dependency, employment, and income      |
|            |     information considered necessary.                   |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > The effective date on a decision to sever service     |
| k. Effecti | > connection is the *first* day of the month following  |
| ve Dates i | > 60 days from the notice of the final rating action.   |
| n a Decisi |                                                         |
| on to Seve | > The effective date for severance is the last day of   |
| r Service  | > the month following 60 days from the date of final    |
| Connection | > notice to the veteran.                                |
|            |                                                         |
|            | > ***Example***: Given a final reduction notification   |
|            | > date of April 22, then                                |
|            |                                                         |
|            | -   60 days following that date is June 22, and         |
|            |                                                         |
|            | -   the first day of the next month is July 1.          |
+------------+---------------------------------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| ####       | > Use the table below to determine what action to take  |
| # l. Actio | > if the service connection is finally severed.         |
| n to Take  | >                                                       |
| on a Ratin | > ***Reference***: For a list of reason codes to use in |
| g Decision | > an amended award to reduce or discontinue payments,   |
|  to Sever  | > see [M21-1, Part I, Appendix C, Table                 |
| Service Co | > F](htt                                                |
| nnection U | p://www.warms.vba.va.gov/admin21/m21_1/part1/appc.doc). |
| nder 38 CF |                                                         |
| R 3.105(a) |                                                         |
+------------+---------------------------------------------------------+

+---------------+-----------------+-----------------------------------+
| If service    | And ...         | Then ...                          |
| connection is |                 |                                   |
| severed under |                 |                                   |
| 38 CFR        |                 |                                   |
| 3.105(a) ...  |                 |                                   |
+---------------+-----------------+-----------------------------------+
| for the only  | \-\--           | -   prepare an amended award      |
| or all        |                 |     discontinuing payment for the |
| serv          |                 |     disability(ies) no longer SC, |
| ice-connected |                 |     effective the first day of    |
| (SC)          |                 |     the month, 60 days after the  |
| disabilities  |                 |     veteran is notified of the    |
|               |                 |     final decision, per [38 CFR   |
|               |                 |     3.500(r                       |
|               |                 | )](http://www.warms.vba.va.gov/re |
|               |                 | gs/38CFR/BOOKB/PART3/S3_500.DOC), |
|               |                 |     and                           |
|               |                 |                                   |
|               |                 | -   under [38 CFR                 |
|               |                 |     3.500(r                       |
|               |                 | )](http://www.warms.vba.va.gov/re |
|               |                 | gs/38CFR/BOOKB/PART3/S3_500.DOC), |
|               |                 |     and                           |
|               |                 |                                   |
|               |                 | -   send a notice of proposed     |
|               |                 |     adverse action to inform the  |
|               |                 |     veteran of the                |
|               |                 |                                   |
|               |                 | ```{=html}                        |
|               |                 | <!-- -->                          |
|               |                 | ```                               |
|               |                 | -   proposed action, and          |
|               |                 |                                   |
|               |                 | -   right to appeal               |
|               |                 |                                   |
|               |                 | ```{=html}                        |
|               |                 | <!-- -->                          |
|               |                 | ```                               |
|               |                 | -   suppress the Benefits         |
|               |                 |     Delivery Network              |
|               |                 |     (BDN)-generated letter        |
|               |                 |                                   |
|               |                 | -   issue the required personal   |
|               |                 |     computer generated letter     |
|               |                 |     (PCGL)                        |
|               |                 |                                   |
|               |                 | -   enter the rating data on the  |
|               |                 |     BDN 301 screen, and           |
|               |                 |                                   |
|               |                 | -   complete the 403 screen,      |
|               |                 |     using reason code 06.         |
+---------------+-----------------+-----------------------------------+
| for one or    | the veteran's   | amend the veteran's award, using  |
| more          | benefits are    | reason code 34 (or reason code    |
| compensable   | reduced,        | 30, if the veteran is entitled to |
| disabilities, | perhaps         | pension), showing the reduced     |
| but *not* for | including a     | entitlement and rating data       |
| all           | conversion to   | reflecting the severance on the   |
| compensable   | pension in      | 301 screen.                       |
| disabilities  | accordance with |                                   |
|               | M21-1MR, Part   | ***Reference***: For more         |
|               | III, Subpart v, | information on the final rating   |
|               | 4.A.2 (TBD).    | decision, see M21-1MR, Part III,  |
|               |                 | Subpart iv, 8.E.17.g.             |
+---------------+-----------------+-----------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

  -----------------------------------------------------------------------
  l\. Action to Take on a Rating Decision to Sever Service Connection
  Under 38 CFR 3.105(a) (continued)

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

+---------------+-------------------+---------------------------------+
| If service    | And ...           | Then ...                        |
| connection is |                   |                                 |
| severed under |                   |                                 |
| 38 CFR        |                   |                                 |
| 3.105(a) ...  |                   |                                 |
+---------------+-------------------+---------------------------------+
| for one or    | the combined      | -   amend the veteran's award   |
| more SC       | evaluation of the |     authorizing increased       |
| disabilities  | remaining         |     benefits effective the date |
|               | disabilities (for |     of receipt of the claim for |
|               | which service     |     increase or the date of     |
|               | connection        |     entitlement, whichever is   |
|               | remains in        |     later, per [38 CFR          |
|               | effect) is        |     3.400(o)](                  |
|               | increased         | http://www.warms.vba.va.gov/reg |
|               |                   | s/38CFR/BOOKB/PART3/S3_400.DOC) |
|               |                   |                                 |
|               |                   | -   authorize payment of        |
|               |                   |     increased compensation, and |
|               |                   |                                 |
|               |                   | -   notify the veteran of the   |
|               |                   |                                 |
|               |                   | ```{=html}                      |
|               |                   | <!-- -->                        |
|               |                   | ```                             |
|               |                   | -   severance action, and       |
|               |                   |                                 |
|               |                   | -   increased evaluation.       |
+---------------+-------------------+---------------------------------+
| for one or    | an increased      | -   enter the rating data by    |
| more SC       | evaluation of the |     amended award processing    |
| disabilities  | remaining SC      |                                 |
|               | disabilities does | -   notify the veteran of each  |
|               | *not* change the  |     decision, including         |
|               | combined          |     reduction, severance, and   |
|               | evaluation        |     increases by letter, and    |
|               |                   |                                 |
|               |                   | -   advise him/her of the right |
|               |                   |     to appeal the decision.     |
+---------------+-------------------+---------------------------------+

Continued on next page

2\. Reduction or Discontinuance of Compensation Resulting From Clear and
Unmistakable Error or Severance of Service Connection, Continued

+------------+---------------------------------------------------------+
| ##### m.   | > Send a copy of the notice of proposed adverse action  |
|  Notificat | > to the                                                |
| ion of VR& |                                                         |
| E and VHA  | -   Vocational Rehabilitation and Employment (VR&E)     |
|            |     activity for appropriate action, if evidence        |
|            |     indicates the veteran receives training under [38   |
|            |     U.S.C. Chapter                                      |
|            |     31](http://straylight.law.cornell.edu               |
|            | /uscode/html/uscode38/usc_sup_01_38_10_III_20_31.html), |
|            |     and                                                 |
|            |                                                         |
|            | -   Chief, Medical Administration Service or            |
|            |     equivalent, at the clinic servicing the regional    |
|            |     office (RO) for updating treatment eligibility      |
|            |     records, as a change in the veteran's status may    |
|            |     affect his/her eligibility for treatment.           |
|            |                                                         |
|            | > If the veteran is hospitalized at VA expense, see     |
|            | > *AMIE User Guide* for instructions. Send the hospital |
|            | > a completed *VA Form 21-653*, *Notice of Change in    |
|            | > Status of Beneficiary Receiving Hospital or           |
|            | > Domiciliary Care.*                                    |
|            | >                                                       |
|            | > ***Important***: Reduction of an SC evaluation or     |
|            | > severance of service connection *may* affect          |
|            | > entitlement under another VA program.                 |
+------------+---------------------------------------------------------+

#### 3. Reductions in Disability Evaluations Under 38 CFR 3.105(e)

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on reductions in      |
| troduction | > disability evaluations. It includes information on    |
|            |                                                         |
|            | -   what determines the appropriate award action        |
|            |                                                         |
|            | -   when 38 CFR 3.105(e) applies                        |
|            |                                                         |
|            | -   initial rating activity action                      |
|            |                                                         |
|            | -   when 38 CFR 3.105(e) does not apply                 |
|            |                                                         |
|            | -   the correct notification action for proposed        |
|            |     reductions                                          |
|            |                                                         |
|            | -   initial notification                                |
|            |                                                         |
|            | -   the action taken if the veteran files a notice of   |
|            |     disagreement (NOD) before the final decision is     |
|            |     made                                                |
|            |                                                         |
|            | -   the action taken based on the response from the     |
|            |     veteran                                             |
|            |                                                         |
|            | -   withdrawing a proposal to reduce an evaluation      |
|            |     under 38 CFR 3.105(e)                               |
|            |                                                         |
|            | -   the action taken on final ratings prepared under 38 |
|            |     CFR 3.105(e)                                        |
|            |                                                         |
|            | -   providing notification to the veteran               |
|            |                                                         |
|            | -   handling evidence received after the final rating   |
|            |     is prepared, and                                    |
|            |                                                         |
|            | -   providing notification to adjust military retired   |
|            |     pay.                                                |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### C    | > September 29, 2006                                    |
| hange Date |                                                         |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ###        | > Rating decisions govern the type of award action, if  |
| ## a. What | > any, taken by authorization.                          |
|  Determine | >                                                       |
| s the Appr | > ***Reference***: For information explaining rating    |
| opriate Aw | > procedures for reducing a previously assigned         |
| ard Action | > evaluation, see                                       |
|            |                                                         |
|            | -   M21-1MR, Part III, Subpart iv, 8.B                  |
|            |                                                         |
|            | -   M21-1MR, Part III, Subpart iv, 8.C, and             |
|            |                                                         |
|            | -   M21-1MR, Part III, Subpart iv, 8.D.                 |
+------------+---------------------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ##### b    | > [38 CFR                                               |
| . When 38  | > 3.105(e)](http://                                     |
| CFR 3.105( | www.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC) |
| e) Applies | > and the information in this topic apply *only* to     |
|            | > reductions in compensation in running awards when a   |
|            | > reduction or discontinuance of compensation results   |
|            | > from                                                  |
|            |                                                         |
|            | -   the reduction in the evaluation of an SC            |
|            |     disability, or                                      |
|            |                                                         |
|            | -   loss of entitlement to a total rating based on      |
|            |     individual unemployability.                         |
|            |                                                         |
|            | > ***Example***: If one or more disability evaluations  |
|            | > is increased or service connection is granted for a   |
|            | > new disability, *but* the combined evaluation is      |
|            | > reduced because of a reduction in the evaluation of   |
|            | > another disability, then                              |
|            |                                                         |
|            | -   award the increase from the applicable effective    |
|            |     date, and                                           |
|            |                                                         |
|            | -   apply the provisions of [38 CFR                     |
|            |     3.105(e)](http://                                   |
|            | www.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC) |
|            |     to propose reduction of the combined evaluation.    |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### c.   | > The rating activity prepares a rating decision        |
|  Initial R | > proposing changes in the evaluation(s) assigned to SC |
| ating Acti | > disabilities resulting in the reduction or            |
| vity Actio | > discontinuance of benefits. This rating decision sets |
| n {#c.-ini | > forth all material facts and reasons for the action.  |
| tial-ratin |                                                         |
| g-activity | > The legend in the rating decision "*PROPOSAL TO       |
| -action .u | > REDUCE EVALUATION(S)--38 CFR 3.105(e)*" identifies    |
| nnumbered} | > the proposed evaluation and (if applicable) the       |
|            | > proposed combined evaluation.                         |
+------------+---------------------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ####       | > Use the table below to determine when [38 CFR         |
| # d. When  | > 3.105(e)](http://                                     |
| 38 CFR 3.1 | www.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC) |
| 05(e) Does | > does not apply and the appropriate action in three    |
|  Not Apply | > different situations.                                 |
+------------+---------------------------------------------------------+

+-------------------------------+--------------------------------------+
| If ...                        | Then ...                             |
+-------------------------------+--------------------------------------+
| the award is suspended        | -   reduce or discontinue the award  |
|                               |     in accordance with facts found,  |
|                               |     but not earlier than the date of |
|                               |     suspension, and                  |
|                               |                                      |
|                               | -   notify the veteran of the change |
|                               |     in the evaluation of the SC      |
|                               |     disability(ies).                 |
+-------------------------------+--------------------------------------+
| -   the evaluation of one or  | -   take no further award action,    |
|     more SC disabilities is   |     and                              |
|     decreased, *but*          |                                      |
|                               | -   notify the veteran of the change |
| -   the combined evaluation   |     in the evaluation of the SC      |
|     remains the same          |     disability(ies).                 |
+-------------------------------+--------------------------------------+
| -   the evaluation of one or  | -   award the increase from the      |
|     more SC disabilities is   |     appropriate effective date, and  |
|     decreased, *but*          |                                      |
|                               | -   notify the veteran of the change |
| -   the combined evaluation   |     in the evaluation of the SC      |
|     is increased because of   |     disability(ies).                 |
|     an offsetting increase in |                                      |
|     the evaluation of another |                                      |
|     SC disability             |                                      |
+-------------------------------+--------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ##### e. C | > Use the table below to determine the correct          |
| orrect Not | > notification action for proposed reductions or        |
| ification  | > discontinuances.                                      |
| Action for |                                                         |
|  Proposed  |                                                         |
| Reductions |                                                         |
|  or Discon |                                                         |
| tinuances  |                                                         |
+------------+---------------------------------------------------------+

+----------------------------------+-----------------------------------+
| If ...                           | Then ...                          |
+----------------------------------+-----------------------------------+
| a proposed rating would result   | send notice of the proposed       |
| in reduced disability            | adverse action under [38 CFR      |
| compensation                     | 3.105(                            |
|                                  | e)](http://www.warms.vba.va.gov/r |
|                                  | egs/38CFR/BOOKB/PART3/S3_105.DOC) |
|                                  | during the same month the rating  |
|                                  | is signed, to ensure reduction or |
|                                  | termination in the month proposed |
|                                  | in the rating decision.           |
+----------------------------------+-----------------------------------+
| -   a proposed rating would      | -   send the veteran notice of    |
|     reduce or terminate the      |     the proposed adverse action,  |
|     veteran's disability         |     and                           |
|     compensation, and            |                                   |
|                                  | -   simultaneously request any    |
| -   the evidence shows a         |     dependency, employment, and   |
|     probability of pension       |     income evidence necessary to  |
|     entitlement as the greater   |     determine entitlement to      |
|     or sole benefit              |     pension.                      |
|                                  |                                   |
|                                  | ***Reference***: For more         |
|                                  | information on establishing       |
|                                  | entitlement to pension, see       |
|                                  | M21-1MR, Part V, Subpart i, 2.    |
+----------------------------------+-----------------------------------+

+-----------------------------------------------------------------------+
| > ***Reference***: For more information on notifying a beneficiary of |
| > a proposed adverse action, see M21-1MR, Part I, 2.B.                |
+-----------------------------------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ##### f.   | > Send a cover letter with the rating decision to the   |
| Initial No | > veteran at the latest address of record informing     |
| tification | > him/her of the                                        |
|            |                                                         |
|            | -   proposed action and giving detailed reasons for the |
|            |     action                                              |
|            |                                                         |
|            | -   60-day period in which he/she may present new       |
|            |     evidence as to why the proposed action should not   |
|            |     be taken, and                                       |
|            |                                                         |
|            | -   proposed date of the reduction which is the last    |
|            |     day of the month, 60 days after the veteran is      |
|            |     notified of the final rating decision.              |
|            |                                                         |
|            | > ***Note***: Do not include language about minimizing  |
|            | > the overpayment, because no overpayment will be       |
|            | > created by the award action.                          |
|            | >                                                       |
|            | > ***Reference***: For information on how               |
|            | > apportionments may be affected by reductions under    |
|            | > [38 CFR                                               |
|            | > 3.105(e)](http://w                                    |
|            | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC), |
|            | > see M21-1MR, Part III, Subpart v, 3.                  |
+------------+---------------------------------------------------------+

+------------+---------------------------------------------------------+
| ##### g. A | > Proposals may not be appealed. Only final actions may |
| ction Take | > be appealed.                                          |
| n If a Vet | >                                                       |
| eran Files | > If a veteran files a notice of disagreement (NOD)     |
|  an NOD Be | > before a final decision is made, explain in a letter  |
| fore a Fin | > that only final actions, not proposed actions, may be |
| al Decisio | > appealed. If the NOD is received during the last 10   |
| n Is Made  | > days of the 60-day due process period, explain this   |
|            | > in the final notice rather than sending a separate    |
|            | > letter.                                               |
|            | >                                                       |
|            | > ***Important***: If the veteran submits supporting    |
|            | > evidence with an NOD, refer the evidence to the       |
|            | > rating activity. There is no need to explain the NOD  |
|            | > is premature until the rating activity makes a        |
|            | > decision on the new evidence.                         |
+------------+---------------------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ##### h. A | > Use the information below to determine the action to  |
| ction Take | > take based on the veteran's response to the notice of |
| n Based on | > proposed action.                                      |
|  the Respo |                                                         |
| nse From t |                                                         |
| he Veteran |                                                         |
|  {#h.-acti |                                                         |
| on-taken-b |                                                         |
| ased-on-th |                                                         |
| e-response |                                                         |
| -from-the- |                                                         |
| veteran .u |                                                         |
| nnumbered} |                                                         |
+------------+---------------------------------------------------------+

+----------------------------------+-----------------------------------+
| If the veteran ...               | Then ...                          |
+----------------------------------+-----------------------------------+
| -   presents new evidence, or    | the rating activity will          |
|                                  |                                   |
| -   requests a hearing within 30 | -   not prepare a final rating    |
|     days of the date of the      |     until the evidence is         |
|     notice of proposed adverse   |     considered, the hearing is    |
|     action                       |     held, or the 60-day due       |
|                                  |     process period elapses        |
|                                  |     (whichever is later), and     |
|                                  |                                   |
|                                  | -   take final rating action      |
|                                  |     reducing the award effective  |
|                                  |     the last day of the month in  |
|                                  |     which the 60-days after the   |
|                                  |     veteran is notified of the    |
|                                  |     final action, if a reduction  |
|                                  |     is still warranted.           |
+----------------------------------+-----------------------------------+
| submits evidence that            | -   request the examination, and  |
| establishes a reasonable basis   |                                   |
| for reexamination                | -   wait until the examination    |
|                                  |     report has been received and  |
|                                  |     considered before taking      |
|                                  |     final action under M21-1MR,   |
|                                  |     Part III, Subpart iv, 8.D.11. |
+----------------------------------+-----------------------------------+
| -   does not submit additional   | take final rating action.         |
|     evidence within 60 days, and |                                   |
|                                  |                                   |
| -   does not request a hearing   |                                   |
+----------------------------------+-----------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ##         | > The actions required to withdraw a proposal to reduce |
| ### i. Wit | > an evaluation depend upon who withdraws the proposal. |
| hdrawing a | >                                                       |
|  Proposal  | > Use the information below to determine the action to  |
| to Reduce  | > take to withdraw a proposal to reduce an evaluation   |
| an Evaluat | > under [38 CFR                                         |
| ion Under  | > 3.105(e)](http://w                                    |
| 38 CFR 3.1 | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC). |
| 05(e) {#i. |                                                         |
| -withdrawi |                                                         |
| ng-a-propo |                                                         |
| sal-to-red |                                                         |
| uce-an-eva |                                                         |
| luation-un |                                                         |
| der-38-cfr |                                                         |
| -3.105e .u |                                                         |
| nnumbered} |                                                         |
+------------+---------------------------------------------------------+

  ----------------------------------- -----------------------------------
  If the ...                          Then the ...

  rating activity decides to withdraw rating activity prepares a rating
  the proposal to reduce an           that confirms and continues (C&C
  evaluation                          rating) the prior evaluation.

  Decision Review Officer (DRO)       DRO prepares a DRO decision
  decides to the withdraw the         confirming the prior evaluation.
  proposal to reduce an evaluation    
  ----------------------------------- -----------------------------------

+------------+---------------------------------------------------------+
| ##### j.   | > Use the information below to determine the actions to |
| Action Tak | > take on final ratings prepared under [38 CFR          |
| en on Fina | > 3.105(e)](http://w                                    |
| l Ratings  | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_105.DOC). |
| Prepared U | >                                                       |
| nder 38 CF | > ***Reference***: For a list of reason codes to use in |
| R 3.105(e) | > an amended award to reduce or discontinue payments,   |
|            | > see [M21-1, Part I, Appendix C, Table                 |
|            | > F](htt                                                |
|            | p://www.warms.vba.va.gov/admin21/m21_1/part1/appc.doc). |
+------------+---------------------------------------------------------+

+------------------------+---------------------------------------------+
| If ...                 | Then ...                                    |
+------------------------+---------------------------------------------+
| the evaluation is      | enter the                                   |
| reduced but remains at |                                             |
| a compensable level    | -   future rating data on the 301 screen as |
|                        |     part of the amended award, and          |
|                        |                                             |
|                        | -   reduced rate, effective as of the       |
|                        |     future date established by the rating,  |
|                        |     which is the first day of the month 60  |
|                        |     days after the veteran is notified of   |
|                        |     the final rating action, using reason   |
|                        |     code 34 (reduced evaluation or          |
|                        |     severance) on the first award line.     |
|                        |                                             |
|                        | ***Note***: If benefits cannot be reduced   |
|                        | without creating an overpayment, return the |
|                        | case to the rating activity for adjustment  |
|                        | of the effective date.                      |
+------------------------+---------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

  -----------------------------------------------------------------------
  j\. Action Taken on Final Ratings Prepared Under 38 CFR 3.105(e)
  (continued)

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

+------------------------+---------------------------------------------+
| If ...                 | Then ...                                    |
+------------------------+---------------------------------------------+
| the evaluation is      | -   enter the rating data on the 301 screen |
| reduced to a           |     as part of the amended award, and       |
| noncompensable level   |                                             |
|                        | -   complete the 403 screen, using reason   |
|                        |     code 05 (disability 0 percent or less   |
|                        |     than 10 percent), effective the first   |
|                        |     day of the month in which the reduced   |
|                        |     evaluation is effective.                |
+------------------------+---------------------------------------------+
| -   the rating         | prepare the amended award using reason code |
|     involves           | 34.                                         |
|                        |                                             |
| ```{=html}             | ***Reference***: For more information on    |
| <!-- -->               | severance of service connection, see        |
| ```                    | M21-1MR, Part IV, Subpart ii. 3.A.2.        |
| -   severance of       |                                             |
|     service connection |                                             |
|     under [38 CFR      |                                             |
|     3.105(             |                                             |
| d)](http://www.warms.v |                                             |
| ba.va.gov/regs/38CFR/B |                                             |
| OOKB/PART3/S3_105.DOC) |                                             |
|                        |                                             |
| -   a reduction under  |                                             |
|     [38 CFR            |                                             |
|     3.105(e            |                                             |
| )](http://www.warms.vb |                                             |
| a.va.gov/regs/38CFR/BO |                                             |
| OKB/PART3/S3_105.DOC), |                                             |
|     and                |                                             |
|                        |                                             |
| ```{=html}             |                                             |
| <!-- -->               |                                             |
| ```                    |                                             |
| -   the combined       |                                             |
|     evaluation is      |                                             |
|     reduced to a       |                                             |
|     noncompensable     |                                             |
|     level              |                                             |
+------------------------+---------------------------------------------+

+------------+---------------------------------------------------------+
| #####      | > When the rating activity makes the final decision     |
| k. Providi |                                                         |
| ng Notific | -   send the beneficiary written notice, even if the    |
| ation to t |     proposed action is not taken                        |
| he Veteran |                                                         |
|            | -   clearly explain the                                 |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   decision                                            |
|            |                                                         |
|            | -   effective date, and                                 |
|            |                                                         |
|            | -   reason for the decision                             |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   provide procedural and appellate rights, and        |
|            |                                                         |
|            | -   send a copy of the letter to the VR&E activity for  |
|            |     appropriate action if evidence indicates that the   |
|            |     veteran is receiving training under [38 U.S.C.      |
|            |     Chapter                                             |
|            |     31](http://straylight.law.cornell.edu               |
|            | /uscode/html/uscode38/usc_sup_01_38_10_III_20_31.html). |
+------------+---------------------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ####       | > Use the table below to determine what steps to take   |
| # l. Handl | > if evidence is received after the final rating is     |
| ing Eviden | > prepared but *prior to* the effective date of         |
| ce Receive | > reduction.                                            |
| d After Fi |                                                         |
| nal Rating |                                                         |
|  Prepared  |                                                         |
+------------+---------------------------------------------------------+

+-----------------------+----------------------------------------------+
| If the rating         | Then ...                                     |
| activity ...          |                                              |
+-----------------------+----------------------------------------------+
| decides the evidence  | -   prepare an amended award to              |
| establishes a need    |                                              |
| for a reexamination   | ```{=html}                                   |
|                       | <!-- -->                                     |
|                       | ```                                          |
|                       | -   continue the rate previously in effect   |
|                       |     (use reason code 00), and                |
|                       |                                              |
|                       | -   correct the rating data on the 301       |
|                       |     screen, and                              |
|                       |                                              |
|                       | ```{=html}                                   |
|                       | <!-- -->                                     |
|                       | ```                                          |
|                       | -   maintain EP control for receipt of the   |
|                       |     examination report.                      |
+-----------------------+----------------------------------------------+
| prepares a new rating | -   prepare an amended award to cancel the   |
| decision restoring    |     scheduled reduction                      |
| the prior             |                                              |
| evaluation(s)         | -   use as the effective date the earlier of |
|                       |     either the first day of the              |
|                       |                                              |
|                       | ```{=html}                                   |
|                       | <!-- -->                                     |
|                       | ```                                          |
|                       | -   current month, or                        |
|                       |                                              |
|                       | -   month the canceled reduction was         |
|                       |     scheduled                                |
|                       |                                              |
|                       | ```{=html}                                   |
|                       | <!-- -->                                     |
|                       | ```                                          |
|                       | -   use                                      |
|                       |                                              |
|                       | ```{=html}                                   |
|                       | <!-- -->                                     |
|                       | ```                                          |
|                       | -   reason code 33 if taking the award       |
|                       |     action after the effective date of the   |
|                       |     canceled rating, or                      |
|                       |                                              |
|                       | -   reason code 00 in all other cases, and   |
|                       |                                              |
|                       | ```{=html}                                   |
|                       | <!-- -->                                     |
|                       | ```                                          |
|                       | -   annotate the award document "*New        |
|                       |     rating* **\[date\]** *cancels prior      |
|                       |     rating* **\[date\]**."                   |
+-----------------------+----------------------------------------------+
| prepares a new rating | > reduce the award effective the last day of |
| decision partially    | > the month, 60 days after the veteran is    |
| restoring the prior   | > notified of the *final* rating action.     |
| evaluation(s)         |                                              |
+-----------------------+----------------------------------------------+

Continued on next page

3\. Reductions in Disability Evaluations Under 38 CFR 3.105(e),
Continued

+------------+---------------------------------------------------------+
| ##         | > If the veteran waived all, or a portion of, military  |
| ### m. Pro | > retired pay to receive disability compensation, the   |
| viding Not | > military retired pay is adjusted or resumed           |
| ification  | > accordingly by the retired pay center upon receipt of |
| to Adjust  | > the data exchange transaction generated by the award  |
| Military R | > action.                                               |
| etired Pay | >                                                       |
|            | > ***Note***: Using special law (SL) code 06 in the     |
|            | > award automatically generates a notice to the retired |
|            | > pay center.                                           |
+------------+---------------------------------------------------------+

#### 4. Awards Under Graduated Tuberculosis (TB) Ratings

+------------+---------------------------------------------------------+
| ##### In   | > This topic contains information on awards under       |
| troduction | > graduated tuberculosis (TB) ratings. It includes      |
|            | > information on                                        |
|            |                                                         |
|            | -   the repeal of graduated ratings for inactive TB     |
|            |                                                         |
|            | -   the definition of ***graduated rating***            |
|            |                                                         |
|            | -   handling ratings involving a reduced evaluation for |
|            |     inactive TB                                         |
|            |                                                         |
|            | -   the action to take when the graduation reaches 0    |
|            |     percent, and                                        |
|            |                                                         |
|            | -   notification of Department of Veterans Affairs (VA) |
|            |     outpatient clinics.                                 |
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| ##### C    | > September 29, 2006                                    |
| hange Date |                                                         |
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| ##         | > *Public Law (PL)* *90-493* repealed sections 38       |
| ### a. Rep | > U.S.C. 314(q) and 38 U.S.C. 356 that provided         |
| eal of Gra | > graduated ratings for inactive tuberculosis (TB).     |
| duated Rat | >                                                       |
| ings for I | > ***Important***: The repealed sections *still* apply  |
| nactive TB | > to any veteran who was receiving, or entitled to      |
|            | > receive, compensation for TB on August 19, 1968,      |
|            | > under [38 CFR                                         |
|            | > 3.959](http://w                                       |
|            | ww.warms.vba.va.gov/regs/38CFR/BOOKB/PART3/S3_958.DOC). |
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| ##### b    | > A ***graduated rating*** is a gradual reduction in a  |
| . Definiti | > disability evaluation for a disease that has moved    |
| on: Gradua | > from the active to the inactive stage.                |
| ted Rating |                                                         |
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| ##         | > If a rating decision reduces a veteran's evaluation   |
| ### c. Han | > for SC TB because it is inactive                      |
| dling Rati |                                                         |
| ngs Involv | -   prepare an amended award to input the               |
| ing a Redu |                                                         |
| ced Evalua | ```{=html}                                              |
| tion for I | <!-- -->                                                |
| nactive TB | ```                                                     |
|            | -   two-year, 100-percent evaluation, and               |
|            |                                                         |
|            | -   graduated or residual evaluations assigned for the  |
|            |     future                                              |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   use the first day of the current month for the      |
|            |     first entry of current award data, and              |
|            |                                                         |
|            | -   inform the veteran of the award action and that the |
|            |     100-percent evaluation may be reduced at an earlier |
|            |     date if he/she fails to                             |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   report for an examination scheduled by the          |
|            |     Department of Veterans Affairs (VA), and/or         |
|            |                                                         |
|            | -   follow the prescribed treatment.                    |
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Continued on next page

4\. Awards Under Graduated Tuberculosis (TB) Ratings, Continued

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| #          | > The monthly rate reduces to \$67 (or \$54 for the     |
| #### d. Ac | > peacetime era (PTE) rate if prior to July 1, 1973) on |
| tion to Ta | > the effective date of graduation to the 0 percent     |
| ke When th | > evaluation. Use                                       |
| e Graduati |                                                         |
| on Reaches | -   SMC code 36 in the rating data on the 301 screen    |
|  0 Percent |     with the 0 percent evaluation effective date, and   |
|            |                                                         |
|            | -   reason code 34 for the award line on the 403        |
|            |     screen.                                             |
|            |                                                         |
|            | > If other noncompensable disabilities exist, notify    |
|            | > the veteran that when the evaluation reduces to 0     |
|            | > percent, he/she may submit evidence from a private    |
|            | > physician to show that the tuberculosis warrants a    |
|            | > compensable evaluation.                               |
|            | >                                                       |
|            | > ***Rationale***: VA cannot grant compensation in lieu |
|            | > of the protected amount unless the disabilities       |
|            | > combine to provide an evaluation of at least 10       |
|            | > percent.                                              |
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| #####      | > If a veteran is granted the                           |
| e. Notific |                                                         |
| ation of V | -   two-year, 100-percent evaluation for inactive TB,   |
| A Outpatie |     notify the Chief, Medical Administration Services   |
| nt Clinics |     or equivalent, of the outpatient clinic responsible |
|            |     for the veteran's follow-up care, or                |
|            |                                                         |
|            | -   one-year, 100-percent evaluation for inactive TB,   |
|            |     then                                                |
|            |                                                         |
|            | ```{=html}                                              |
|            | <!-- -->                                                |
|            | ```                                                     |
|            | -   send the outpatient clinic responsible for the      |
|            |     veteran's follow-up care a copy of the rating       |
|            |     initially granting service connection for TB, and   |
|            |                                                         |
|            | -   do *not* send any other notice to the Chief,        |
|            |     Medical Administration Services, of the outpatient  |
|            |     clinic responsible for the veteran's follow-up      |
|            |     care.                                               |
|            |                                                         |
|            | > ***Reference***: For more information on TB, see      |
|            | > M21-1MR, Part III, Subpart iv, 4.D.17.                |
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