Supplemental Statement of the Case, 40745-40748 [E8-16238]

Agencies

• DEPARTMENT OF VETERANS AFFAIRS

[Federal Register Volume 73, Number 137 (Wednesday, July 16, 2008)]
[Rules and Regulations]
[Pages 40745-40748]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-16238]


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DEPARTMENT OF VETERANS AFFAIRS

38 CFR Parts 19 and 20

RIN 2900-AM49


Supplemental Statement of the Case

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: The Department of Veterans Affairs (VA) is amending its 
regulations to adjust the time period for filing a response to a 
Supplemental Statement of the Case in appeals to the Board of Veterans' 
Appeals (Board) from 60 days to 30 days. The purpose of this adjustment 
is to improve efficiency in the appeals process and reduce the time 
that it takes to resolve appeals while still providing appellants with 
a reasonable period to respond to a Supplemental Statement of the Case.

DATES: Effective Date: This rule is effective July 16, 2008.
    Applicability Date: VA will apply this rule to appeals pending 
before VA after a period of 90 days from the effective date of this 
rule.

FOR FURTHER INFORMATION CONTACT: Steven L. Keller, Senior Deputy Vice 
Chairman, Board of Veterans' Appeals (012), Department of Veterans 
Affairs, 810 Vermont Avenue, NW., Washington, DC 20420, (202) 565-5978. 
(This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: The Board is an administrative body within 
VA that decides appeals from denials by Agencies of Original 
Jurisdiction (AOJ) of claims for veterans' benefits, as well as a 
limited class of cases of original jurisdiction. The Board is under the 
administrative control and supervision of a Chairman who is directly 
responsible to the Secretary of Veterans Affairs. 38 U.S.C. 7101(a).
    On March 26, 2007, VA published in the Federal Register (72 FR 
14056) a Notice of Proposed Rulemaking (NPRM) that proposed to reduce 
the time limit for filing a response to a Supplemental Statement of the 
Case from 60 days to 30 days. Interested persons were invited to submit 
written comments on or before May 25, 2007.
    Eight comments were received, all of which disagreed with the 
proposed rule for reasons summarized below. At least three commenters 
argued that 30 days was simply not enough time to respond to a 
Supplemental Statement of the Case. Those commenters also questioned 
the purpose of the time reduction, arguing that this action would not 
serve the stated purpose of expediting appeals adjudication. One 
commenter indicated that the proposed rule would add further confusion 
regarding the various time periods within which claimants must respond 
to VA documents. Another commenter expressed concern that the proposed 
rule did not consider individuals who have appeals pending and yet 
reside outside of the United States. Two commenters expressed concern 
over the process of requesting an extension for filing a response to a 
Supplemental Statement of the Case. Finally, several commenters 
provided general suggestions for improving the VA adjudication system.
    A recurring theme among the comments received was that 30 days was 
simply not enough time to prepare a response to a Supplemental 
Statement of the Case. One commenter noted that many veterans are 
represented by veterans service organizations that are overworked and 
understaffed, which results in veterans having to wait 3 to 4 weeks 
just to get an appointment with their representative. Thus, the 
commenter concluded, 30 days would be an insufficient amount of time in 
which to prepare a response. The commenter also suggested that VA was 
implementing this time reduction in hopes of receiving fewer responses 
to Supplemental Statements of the Case. A second commenter noted that 
if additional medical evidence, such as a rebuttal medical opinion, was 
required to respond to evidence outlined in the Supplemental Statement 
of the Case, a 30-day response period leaves little time to obtain such 
evidence. Yet another commenter remarked that Supplemental Statements 
of the Case often contain only a brief description of the evidence 
added to the record, thus, requiring claimants to request complete 
copies of such evidence from the AOJ in order to prepare a response. 
The commenter argued that this process alone can take more than 30 
days.
    Although VA recognizes and appreciates the concerns expressed by 
these commenters, we believe that the 30-day response time offered 
under the proposed rule does in fact afford appellants a reasonable 
opportunity to meaningfully respond to a Supplemental Statement of the 
Case, and we decline to make any changes to the response time outlined 
in the proposed rule based on these comments. As explained in the NPRM, 
Supplemental Statements of the Case are issued at a late stage in the 
appellate process, often the last formal step prior to certification of 
an appeal to the Board. By that stage in the appeal period, appellants 
have already had extensive opportunity to gather evidence, including 
supportive medical opinions, for submission to the AOJ. Unlike a 
Statement of the Case, which must contain specific information about 
the evidence and issues in the case, the applicable laws and 
regulations, and the reasons for each determination, a Supplemental 
Statement of the Case is not required to contain the same degree of 
detail. As its name implies, a Supplemental Statement of the Case is a 
supplement to the Statement of the Case. The purpose of this document 
is to inform the appellant of any material changes in, or additions to, 
the information included in the Statement of the Case or any prior 
Supplemental Statement of the Case. 38 CFR 19.31(a). In no case will a 
Supplemental Statement of the Case be used to announce AOJ decisions on 
issues that were not previously addressed in a Statement of the Case. 
38 CFR 19.31(a). Therefore, due to the limited purpose of a 
Supplemental Statement of the Case, less time should be needed to 
respond to a Supplemental Statement of the Case as compared to the 
Statement of the Case. Significantly, a response to a Supplemental 
Statement of the Case is optional and generally is not required to 
perfect an appeal. 38 CFR 20.302(c).
    To the extent that certain cases involve a degree of medical or 
legal complexity so as to require additional time to craft an 
appropriate response to a Supplemental Statement of the Case, 
appellants can easily request an extension of the 30-day period for 
responding to a Supplemental Statement of the Case under the provisions 
of 38 CFR 20.303. Section 20.303 provides that an extension of the 
period for filing a response to a Supplemental Statement of the Case 
may be granted for good cause. Although good cause is not specifically 
defined by that regulation, it seems logical that a request for an 
extension on the basis that additional medical evidence was being 
sought would indeed be good cause for such an extension. Moreover, in 
response to one commenter's concern that the extension request may not 
be granted, the rule provides that a denial of a request for extension 
is appealable to the Board. 38 CFR 20.303.
    We will, however, make one minor revision to the extension 
provisions of 38 CFR 20.303 to ensure that they have

[[Page 40746]]

broad applicability. Currently, Sec.  20.303 allows for an extension of 
the period to respond to a Supplemental Statement of the Case based on 
good cause only when a response to the Supplemental Statement of the 
Case ``is required.'' As noted above, however, in the vast majority of 
cases, a response to a Supplemental Statement of the Case is merely 
optional and is not mandatory to perfect an appeal. 38 CFR 20.302(c). A 
response to a Supplemental Statement of the Case is only ``required'' 
when a Substantive Appeal has not been submitted and the statutory 
period to file the same has not expired. Id. Because Supplemental 
Statements of the Case are typically issued after a Substantive Appeal 
has been filed, a response is rarely needed to perfect the appeal. 
Thus, as currently written, the extension request provisions of Sec.  
20.303 have narrow applicability in that they only apply in the rare 
case where a Substantive Appeal has not been filed and a response to a 
Supplemental Statement of the Case is required to perfect an appeal.
    To ensure that all appellants are able to request an extension of 
the period to respond to a Supplemental Statement of the Case based on 
good cause, regardless of whether such response is required to perfect 
the appeal, we will delete the phrase ``when such a response is 
required'' from the first sentence of 38 CFR 20.303. This minor 
revision will ensure that all appellants will have a mechanism to 
request an extension, regardless of the procedural posture of their 
cases.
    Even in the absence of an approved extension request, the appellant 
still has an additional opportunity to submit evidence and argument in 
his or her appeal. As noted in the NRPM, in addition to the 30-day 
period to respond to the Supplemental Statement of the Case, once an 
appeal has been certified and transferred to the Board, the appellant 
typically still has 90 days to submit further evidence. 38 CFR 
20.1304(a). Although 38 CFR 20.1304(a) states that the appellant has 90 
days or until the Board promulgates a decision to submit evidence, as a 
practical matter, with the exception of a limited class of cases, such 
as cases advanced on the Board's docket pursuant to 38 U.S.C. 
7107(a)(2), the Board generally does not decide cases until after the 
90-day period has passed. This effectively provides the vast majority 
of appellants with the full 90 days to submit additional evidence. 
Moreover, under 38 CFR 20.1304(b), even after the 90-day period expires 
an appellant may still move to submit additional evidence if he or she 
can demonstrate good cause for the delayed submission.
    One commenter expressed concern that the aforementioned extension 
procedure imposes an ``additional burden'' upon appellants to request 
an extension of time and show good cause, which ``suggests hostility 
toward their claims and is inconsistent with the notion of a veteran-
friendly VA system.'' VA respectfully disagrees with this comment for 
several reasons. First, the commenter is presupposing that this 
rulemaking will have adverse effects for veterans and other claimants 
seeking veterans' benefits. On the contrary, we believe that this 
rulemaking will add efficiency to the appeals process and lessen the 
time needed at the AOJ level to resolve appeals. Currently, due in part 
to the fact that a response to a Supplemental Statement of the Case is 
usually optional, many appellants choose not to file a response. 
However, VA must wait until the current 60-day time period expires 
before taking any further action in the appeal. Although a waiver form 
is sometimes used to ask appellants if they wish to waive this 60-day 
period, responses are not always received to that request. Therefore, 
the result is cases that sit without any action, simply waiting for a 
regulatory time period to expire. By shortening the turn-around time 
provided for a response to a Supplemental Statement of the Case, 
appeals can be certified and transferred to the Board sooner, thereby 
allowing that tribunal to adjudicate the claim sooner than if the 
claims file was allowed to linger at the AOJ for an additional 30 days.
    VA emphasizes that the purpose of this rulemaking is not to saddle 
appellants with an additional obligation to make extension requests, 
but rather to streamline the appeals process for the vast majority of 
appellants who either need little time to formulate a response to a 
Supplemental Statement of the Case or who wish to submit no response at 
all.
    In response to the criticism that this reduced time period will not 
serve the stated purpose of expediting appeals or that VA is taking 
this action in the hopes that few responses will be received, that is 
simply not true. The VA claims and adjudication process has grown 
tremendously over the years both regarding the volume of claims and 
appeals, and the legal and medical complexity of the cases. Along with 
this high volume has come an increased appeals resolution time. VA is 
closely examining its systems to determine where time can be reduced. 
Although this 30-day reduction may be small in the scheme of the 
average appeal, it is an initial step in the right direction. Reducing 
unnecessary wait times encourages efficiency and promotes case 
movement. There is no adverse effect on the appellant, as a process 
exists for requesting an extension, if one is desired. That extension 
request is itself an appealable issue, thus ensuring legal protection 
of the appellant's right to respond to a Supplemental Statement of the 
Case.
    While an extension request may be needed in more complex cases or 
where extenuating circumstances are present, such cases constitute a 
relatively small percentage of the overall number of appeals in the VA 
system. We do not believe that requiring appellants to request an 
extension in these cases represents an overly burdensome task. The 
extension procedure is already an integral part of 38 CFR 20.303. This 
rulemaking merely reduces to 30 days, as opposed to 60, the period 
during which the extension request must be made. It also liberalizes 
the extension request procedure by allowing all appellants to make an 
extension request, regardless of whether a response to the Supplemental 
Statement of the Case is required to perfect the appeal. As outlined 
above, at the Supplemental Statement of the Case stage, the appellant 
has already been afforded ample opportunity to submit evidence and 
argument in support of his or her claim. In the relatively small number 
of cases where a 30-day response period may be inadequate to respond to 
the Supplemental Statement of the Case, an extension request provides 
an uncomplicated means to allow for the submission of additional 
evidence and argument. Again, should the AOJ deny such request, that 
denial is itself appealable to the Board. Moreover, as noted above, 
there is still generally a minimum period of 90 days for evidence 
submission after the appeal is certified and transferred to the Board. 
We therefore make no changes based on these comments.
    Another commenter also expressed concern that a 30-day response 
time was inadequate for those individuals who have appeals pending but 
reside outside the United States. The commenter argued that a 
Supplemental Statement of the Case mailed to an address overseas 
presumably takes longer to be delivered than mail being delivered to an 
address close to the AOJ. While VA acknowledges that mail delivered to 
destinations at a distance from the AOJ may take longer to reach the 
intended recipient, we do not believe that such consideration warrants 
any change to the proposed rule. In fact, no other VA regulations 
pertaining to claims

[[Page 40747]]

adjudication allow different time periods for overseas mailings. We do 
note, however, that while mailing to a distant destination may delay 
the appellant's actual receipt of the Supplemental Statement of the 
Case, it will not affect the timeliness of the response. The 
regulations currently provide that a response postmarked prior to the 
expiration of an applicable time limit will be accepted as having been 
timely filed. 38 CFR 20.305. In the event that the postmark is not of 
record, the postmark date will be presumed to be 5 days prior to the 
date of the receipt of the document by VA. Id. Thus, if a claimant's 
response to a Supplemental Statement of the Case is postmarked prior to 
the expiration of the 30-day period, it will be considered timely, even 
if the response is not received by VA within the 30-day period 
(including due to mailing delays). Accordingly, VA makes no change 
based on this comment.
    As outlined above, Supplemental Statements of the Case are limited 
in scope and are issued for the sole purpose of informing the appellant 
of material changes in or additions to information found in the 
Statement of the Case or a prior Supplemental Statement of the Case. We 
again note that Supplemental Statements of the Case are issued well 
into the appeals process and after claimants have had adequate 
opportunity to submit or identify favorable evidence. Due to the 
limited purpose of a Supplemental Statement of the Case and its 
occurrence late in the appeals process, little time should be required 
to respond in most cases. Thus, most appellants should be able to 
timely respond even in situations where the Supplemental Statement of 
the Case is not immediately received by a claimant due to mailing 
delays. As with other cases, should 30 days prove insufficient, an 
extension may be granted where good cause is shown. In certain 
circumstances, good cause may include those situations where an 
appellant's response time is truncated due to mail delays.
    Another commenter expressed concern that the change to a 30-day 
response period would ``add further confusion regarding the time 
periods with which claimants must respond to VA documents.'' We 
respectfully disagree. The revised period is not misleading or 
difficult to calculate. The 30-day response period established in this 
rulemaking is not inherently more confusing than the current 60-day 
period. Nor do we find confusing a 30-day period among other periods 
for responding to other documents. Response periods and filing 
deadlines are a necessary part of any regulatory system, including that 
governing the response to Supplemental Statements of the Case. While 
claimants and their representatives will need to adjust to a shortened 
time frame to craft a response to a Supplemental Statement of the Case, 
we believe that this change is quite straightforward in application. 
Therefore, we make no change based on this comment.
    Finally, we acknowledge the comments containing general suggestions 
for improving the VA claims adjudication system. While VA welcomes any 
input regarding improvements in the system, these particular comments 
do not directly concern the subject of this rulemaking, and therefore, 
this document is not an appropriate venue to address such comments. 
Thus, VA makes no changes to the NPRM based on those comments.
    Based on the rationale stated above, as well as the rationale 
outlined in the NPRM, the proposed rule is adopted with the minor 
change to 38 CFR 20.303 outlined above.

Paperwork Reduction Act

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

Regulatory Flexibility Act

    The Secretary hereby certifies that this final rule will not have a 
significant economic impact on a substantial number of small entities 
as they are defined in the Regulatory Flexibility Act, 5 U.S.C. 601-
612. By reducing the period allowed for submitting an optional response 
to a Supplemental Statement of the Case to 30 days, this final rule 
will affect claimants for VA benefits who appeal to the Board. It may 
also affect a few small organizations appealing to the Board, including 
attorneys appealing the cancellation of their accreditation by the VA 
General Counsel and accredited attorneys appealing decisions affecting 
payment of their fees out of past-due benefits awarded to VA claimants. 
This final rule may also affect a few small governmental jurisdictions 
appealing to the Board, such as state agencies appealing VA decisions 
on per diem payments for services provided to veterans in state homes.
    However, reducing the period permitted for submitting an optional 
response to a Supplemental Statement of the Case would not have a 
significant economic impact on a substantial number of these small 
entities. Rather, it will expedite the processing of their appeals to 
the Board. Therefore, pursuant to 5 U.S.C. 605(b), this final rule is 
exempt from the initial and final regulatory flexibility analysis 
requirement of 5 U.S.C. 603 and 604.

Executive Order 12866

    Executive Order 12866 directs agencies to assess all costs and 
benefits of available regulatory alternatives and, when regulation is 
necessary, to select regulatory approaches that maximize net benefits 
(including potential economic, environmental, public health and safety, 
and other advantages; distributive impacts; and equity). The Executive 
Order classifies a ``significant regulatory action,'' requiring review 
by the Office of Management and Budget (OMB) unless OMB waives such 
review, as any regulatory action that is likely to result in a rule 
that may: (1) Have an annual effect on the economy of $100 million or 
more or adversely affect in a material way the economy, a sector of the 
economy, productivity, competition, jobs, the environment, public 
health or safety, or State, local, or tribal governments or 
communities; (2) Create a serious inconsistency or otherwise interfere 
with an action taken or planned by another agency; (3) Materially alter 
the budgetary impact of entitlements, grants, user fees, or loan 
programs or the rights and obligations of recipients thereof; or (4) 
Raise novel legal or policy issues arising out of legal mandates, the 
President's priorities, or the principles set forth in the Executive 
Order.
    The economic, interagency, budgetary, legal, and policy 
implications of this final rule have been examined and it has been 
determined to be a significant regulatory action under Executive Order 
12866.

Unfunded Mandates

    The Unfunded Mandates Reform Act of 1995 requires, at 2 U.S.C. 
1532, that agencies prepare an assessment of anticipated costs and 
benefits before issuing any rule that may result in an expenditure by 
State, local, and tribal governments, in the aggregate, or by the 
private sector of $100 million or more (adjusted annually for 
inflation) in any 1 year. This final rule would have no such effect on 
State, local, and tribal governments, or on the private sector.

Catalog of Federal Domestic Assistance Numbers

    The Catalog of Federal Domestic Assistance program numbers and 
titles for this proposal are 64.100, Automobiles and Adaptive Equipment 
for Certain Disabled Veterans and Members of the Armed Forces; 64.101,

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Burial Expenses Allowance for Veterans; 64.102, Compensation for 
Service-Connected Deaths for Veterans' Dependents; 64.103, Life 
Insurance for Veterans; 64.104, Pension for Non-Service-Connected 
Disability for Veterans; 64.105, Pension to Veterans' Surviving 
Spouses, and Children; 64.106, Specially Adapted Housing for Disabled 
Veterans; 64.109, Veterans Compensation for Service-Connected 
Disability; 64.110, Veterans Dependency and Indemnity Compensation for 
Service-Connected Death; 64.114, Veterans Housing-Guaranteed and 
Insured Loans; 64.115, Veterans Information and Assistance; 64.116, 
Vocational Rehabilitation for Disabled Veterans; 64.117, Survivors and 
Dependents Educational Assistance; 64.118, Veterans Housing-Direct 
Loans for Certain Disabled Veterans; 64.119, Veterans Housing-
Manufactured Home Loans; 64.120, Post-Vietnam Era Veterans' Educational 
Assistance; 64.124, All-Volunteer Force Educational Assistance; 64.125, 
Vocational and Educational Counseling for Servicemembers and Veterans; 
64.126, Native American Veteran Direct Loan Program; 64.127, Monthly 
Allowance for Children of Vietnam Veterans Born with Spina Bifida; and 
64.128, Vocational Training and Rehabilitation for Vietnam Veterans' 
Children with Spina Bifida or Other Covered Birth Defects.

List of Subjects in 38 CFR Parts 19 and 20

    Administrative practice and procedure, Claims, Veterans.

    Approved: April 25, 2008.
Gordon H. Mansfield,
Deputy Secretary of Veterans Affairs.

0
For the reasons set forth in the preamble, 38 CFR parts 19 and 20 are 
amended as follows:

PART 19--BOARD OF VETERANS' APPEALS: APPEALS REGULATIONS

0
1. The authority citation for part 19 continues to read as follows:

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

Subpart B--Appeals Processing by Agency of Original Jurisdiction


Sec.  19.38  [Amended]

0
2. Section 19.38 is amended by removing ``60-day'' and adding, in its 
place, ``30-day''.

PART 20--BOARD OF VETERANS' APPEALS: RULES OF PRACTICE

0
3. The authority citation for part 20 continues to read as follows:

    Authority: 38 U.S.C. 501(a) and as noted in specific sections.

Subpart D--Filing


Sec.  20.302  [Amended]

0
4. Section 20.302(c) is amended by removing ``60'' and adding, in its 
place, ``30''.


Sec.  20.303  [Amended]

0
5. Section 20.303 is amended by removing the phrase ``or the 60-day 
period for responding to a Supplemental Statement of the Case when such 
a response is required'' and adding, in its place, ``or the 30-day 
period for responding to a Supplemental Statement of the Case''.

[FR Doc. E8-16238 Filed 7-15-08; 8:45 am]
BILLING CODE 8320-01-P