Servicemembers' Group Life Insurance Traumatic Injury Protection Program, 71926-71935 [E8-28114]

Agencies

• DEPARTMENT OF VETERANS AFFAIRS

[Federal Register Volume 73, Number 229 (Wednesday, November 26, 2008)]
[Rules and Regulations]
[Pages 71926-71935]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: E8-28114]


=======================================================================
-----------------------------------------------------------------------

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 9

RIN 2900-AN00


Servicemembers' Group Life Insurance Traumatic Injury Protection 
Program

AGENCY: Department of Veterans Affairs.

ACTION: Interim final rule.

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

SUMMARY: The Department of Veterans Affairs (VA) is issuing this 
interim final rule to amend the Servicemembers' Group Life Insurance 
traumatic injury protection program (TSGLI) regulations in order to add 
losses that would be covered under the program and to define terms 
relevant to these new losses. This rulemaking also clarifies language 
in and reorganizes existing provisions.

DATES: This interim final rule is effective November 26, 2008. Comments 
must be received on or before December 26, 2008.
    Applicability Date: VA will apply this rule to injuries incurred in 
Operation Enduring Freedom or Operation Iraqi Freedom on or after 
October 7, 2001, through and including November 30, 2005, and to all 
qualifying injuries incurred on or after December 1, 2005.

ADDRESSES: Written comments may be submitted through https://
www.Regulations.gov; by mail or hand-delivery to Director, Regulations 
Management (02REG), Department of Veterans Affairs, 810 Vermont Ave., 
NW., Room 1068, Washington, DC 20420; or by fax to (202) 273-9026. 
Comments should indicate that they are submitted in response to ``RIN 
2900-AN00.'' Copies of comments received will be available for public 
inspection in the Office of Regulation Policy and Management, Room 
1063B, between the hours of 8 a.m. and 4:30 p.m., Monday through Friday 
(except holidays). Please call (202) 461-4902 for an appointment. (This 
is not a toll-free number.) In addition, during the comment period, 
comments are available online through the Federal Docket Management 
System (FDMS) at https://www.Regulations.gov.

FOR FURTHER INFORMATION CONTACT: Jeanne King, Attorney-Advisor, 
Department of Veterans Affairs Regional Office and Insurance Center 
(310/290B), P.O. Box 8079, Philadelphia, Pennsylvania 19101, (215) 842-
2000, ext. 4839. (This is not a toll-free number.)

SUPPLEMENTARY INFORMATION: TSGLI was established by Congress in May 
2005 to provide monetary assistance to severely injured service members 
who suffer a loss, such as the loss of a hand, as a direct result of a 
serious traumatic injury in order to help the member and the member's 
family through an often long and arduous treatment and rehabilitation 
period. VA codified regulations to implement TSGLI at 38 CFR 9.1(k)-(q) 
and 9.20. See 70 FR 75940 (Dec. 22, 2005); 72 FR 10362 (Mar. 8, 2007).
    VA conducted an extensive review of the TSGLI program at the end of 
the first year of the program's operation (``Year-One Review'') to 
ensure that the program was operating effectively and that it was 
meeting the intent of Congress. The report was published on the VA Web 
site on July 17, 2008. https://www.insurance.va.gov/miscellaneous/
index.htm. Many of the amendments made by this interim final rule, 
particularly the losses that we propose to add to the Schedule of 
Losses in Sec.  9.20, are derived from the recommendations and findings 
of the TSGLI Year-One Review.
    Congress has expressed its intent to provide TSGLI benefits 
retroactively. Section 1032(c)(1) of the ``Emergency Supplemental 
Appropriations Act for Defense, the Global War on Terror, and Tsunami 
Relief, 2005,'' Public Law 109-13, which established the TSGLI program 
effective December 1, 2005, also provided for the payment of TSGLI 
benefits to service members who experienced a traumatic injury between 
October 7, 2001, when Operation Enduring Freedom began, and December 1, 
2005, the effective date of section 1032 of Public Law 109-13, if the 
loss was a direct result of injuries incurred in Operation Enduring 
Freedom or Operation Iraqi Freedom. VA as well has made its regulations 
implementing the TSGLI program retroactive. In 2007, VA applied changes 
to the TSGLI program made by the Veterans' Housing Opportunity and 
Benefits Improvement Act of 2006, Public Law 109-233, section 
501(a)(3), 120 Stat. 397, 413, to claims filed or injuries suffered 
prior to the date of the change in the law because it was consistent 
with the objectives of the TSGLI provisions authorizing payments based 
on injuries preceding the program's creation. 72 FR 10362, 10363 
(2007). We believe that the same holds true with regard to the changes 
made by this rulemaking. Further, because TSGLI is intended to provide 
a source of income for expenses during periods of treatment and 
convalescence following a loss due to traumatic injury, we believe the 
application of these regulations is more directly connected to those 
persistent circumstances than to the past date on which an injury or 
loss was incurred or a claim was filed. Id. We also note that these 
regulatory amendments would not have affected conduct prior to the date 
of publication, nor would the regulations upset any settled 
expectations in any meaningful way. See Landgraf v. USI Film Prods., 
511 U.S. 244, 280 (1994); Princess Cruises, Inc. v. United States, 397 
F.3d 1358, 1362-63 (Fed. Cir. 2005). The service member's traumatic 
injury, the scheduled loss due to the injury, and the resulting 
economic burdens on the service member were not within any party's 
control and obviously actions were not taken in reliance on prior 
regulations. Although application of the regulations will increase the 
Government's economic burden, we believe the additional burden is 
countered in this instance by the other considerations discussed above.
    We are amending 38 CFR 9.1(b) to provide the current address of the 
Office of Servicemembers' Group Life Insurance (OSGLI), which is 80 
Livingston Avenue, Roseland, New Jersey 07068.
    We are moving the definitions from 38 CFR 9.1(k)-(q), which pertain 
only to TSGLI, to 38 CFR 9.20(e)(6)(vi)-(xii) for purposes of 
administrative convenience and to make it easier for the public to 
locate the rules. We are expanding the definition of ``medical 
professional'' at Sec.  9.20(e)(6)(xii) to include a ``licensed 
practitioner of the healing arts acting within the scope of his or her 
practice.'' We have broadened the definition in order to encompass a 
wider range of licensed medical professionals who are qualified to 
certify eligibility for TSGLI.
    We are revising 38 CFR 9.20(b)(3) to state that the term 
``traumatic event'' does not include a medical procedure or a surgical 
procedure in and of itself. Current Sec.  9.20(b)(3) only refers to a 
surgical procedure. The revision makes the regulation consistent with 
VA's current practice of not providing TSGLI payments for an injury 
that directly results from either a medical or surgical procedure. The 
publication of this revision to the current rule will not result in any 
deviation from already established guidelines or processes. Further, 
the revised definition is consistent with current 38 CFR 
9.20(e)(3)(i)(C), which excludes payment for a scheduled loss due to a

[[Page 71927]]

traumatic injury caused by either medical treatment or surgical 
treatment of an illness or disease.
    We are adding a new paragraph at the end of 38 CFR 9.20(d) with 
regard to the eligibility requirements for a TSGLI payment. The 
governing statute for the TSGLI program, 38 U.S.C. 1980A(h), states 
that ``[c]overage for loss resulting from traumatic injury provided 
under this section shall cease at midnight on the date of the 
termination of the member's duty status in the uniformed services that 
established eligibility for Servicemembers' Group Life Insurance.'' New 
Sec.  9.20(d)(5) specifies that a member would be covered by TSGLI if 
the member has a traumatic injury prior to midnight on the date of 
termination, even if the member's scheduled loss does not occur until 
after the member's termination date. We are making this revision to the 
regulation because in some cases there is a long period between the 
date of a member's traumatic injury and the date on which the scheduled 
loss actually occurs. For example, a member who suffers a severe leg 
injury from an explosion in service may not undergo amputation of the 
leg until after separating from service. This amendment to Sec.  
9.20(d) would clarify that, under such circumstances, the member would 
be eligible for TSGLI.
    Currently, 38 CFR 9.20(e)(3)(i)(C) provides that TSGLI is not 
payable if a traumatic injury is caused by medical or surgical 
treatment of an illness or disease. We are revising that paragraph to 
explain that TSGLI also is not payable if a traumatic injury is caused 
by diagnostic procedures or any complications arising from such 
procedures or from medical or surgical treatment for an illness or 
disease. The commercial industry's Accidental Death and Dismemberment 
(AD&D) policies provide a model for the TSGLI program. 70 FR 75940. 
Under commercial AD&D policies, neither diagnostic complications nor 
post-surgical complications due to medical or surgical treatment 
usually constitute a covered loss. We are therefore revising Sec.  
9.20(d)(5) to make it consistent with commercial policies. We are also 
revising Sec.  9.20(e)(3)(i)(C) to explain that TSGLI is not payable if 
a traumatic injury is caused by preventive medical procedures such as 
inoculations.
    We are amending 38 CFR 9.20(e)(3)(i)(D), which currently excludes 
payment of TSGLI for a scheduled loss due to a traumatic injury caused 
by willful use of a controlled substance unless administered or 
consumed on the advice of a ``medical doctor.'' We are deleting the 
term ``medical doctor'' and inserting in its place ``medical 
professional,'' because prescriptions for controlled substances may be 
dispensed by a caregiver other than a medical doctor (e.g., a nurse 
practitioner). This revision will clarify that a member who receives a 
lawful controlled substance from a medical professional who is legally 
authorized to provide such a controlled substance will be eligible for 
a TSGLI payment. Also, use of the term ``medical professional'' is 
consistent with the terminology in the TSGLI procedural guide, https://
www.insurance.va.gov/sgliSite/TSGLI/TSGLI.htm, and the TSGLI 
application form.
    We are amending 38 CFR 9.20(e)(6) to correct a misstatement 
concerning the scope of its application. Current 38 CFR 9.20(e)(6) 
states that the definitions apply ``[f]or purposes of this paragraph 
(e)(6)--.'' We have corrected this to read, ``For purposes of this 
section--.''
    We also are adding to Sec.  9.20(e)(6) definitions of terms 
relevant to qualifying losses under the existing TSGLI Schedule of 
Losses and to other losses that we are adding to that schedule in this 
rulemaking. Because of the interrelated nature of the definitions and 
schedule losses, we will discuss the definitions in conjunction with 
the relevant amendments for each loss.
    In the Schedule of Losses, we are making several non-substantive 
changes that will make it easier to use. These non-substantive changes 
include moving the schedule from Sec.  9.20(e)(7) to Sec.  9.20(f) and 
replacing the Roman numerals preceding each loss with Arabic numerals. 
Another non-substantive change involves the types of losses listed in 
the schedule. The current schedule lists both single losses (e.g., 
total and permanent loss of speech) and combinations of losses (e.g., 
total and permanent loss of speech and loss of thumb and index finger 
on the same hand). We are removing all losses involving a combination 
of losses and instead explain how the different individual losses may 
be combined for purposes of calculating the TSGLI benefit that is 
payable. For losses listed in paragraphs (f)(1) through (18) of Sec.  
9.20, payment may be made for multiple losses resulting from a single 
traumatic event (except where noted otherwise); however, the total 
payment amount may not exceed $100,000 for losses resulting from a 
single traumatic event. Payments for losses listed in paragraphs 
(f)(19) through (20) of Sec.  9.20 may not be made in addition to 
payments for losses under paragraphs (f)(1) through (18)--only the 
higher amount will be paid. The total payment amount may not exceed 
$100,000 for multiple losses resulting from a single traumatic event.
    Payment for total and permanent loss of sight is required by 38 
U.S.C. 1980A(b)(1)(A). In Sec.  9.20(e)(6)(xiv), consistent with 
current VA practice, we are defining ``total and permanent loss of 
sight,'' which is included in the Schedule of Losses at Sec.  
9.20(f)(1), as: (1) Visual acuity in the eye of 20/200 or less (worse) 
with corrective lenses lasting at least 120 days; (2) visual acuity in 
the eye of greater than 20/200 with corrective lenses and a visual 
field of 20 degrees or less lasting at least 120 days; or (3) 
anatomical loss of the eye. These visual-acuity standards are similar 
to the eligibility criteria for automobiles and adaptive equipment for 
certain disabled veterans, 38 U.S.C. 3901(1)(A)(iii), and to the 
definition of ``blindness'' for purposes of Social Security disability 
benefits. 42 U.S.C. 1382c(2).
    We are incorporating the temporal requirement of ``at least 120 
days'' in the definition of ``permanent and total loss of sight'' for 
the benefit of medical professionals who are responsible for certifying 
TSGLI eligibility of an injured service member. Staff members at the 
branches of service who process TSGLI claims reported for purposes of 
the Year-One Review that medical professionals were sometimes unwilling 
to certify that loss of sight was ``permanent,'' even when the loss of 
sight had already existed for a rather lengthy period of time and even 
when it required substantial rehabilitation on the part of the member, 
because the member might regain some sight due to surgery (e.g., 
corneal transplants) at a later date. Year-One Review at 24.
    We are combining the losses for total and permanent loss of hearing 
in one ear and both ears at 38 CFR 9.20(f)(2). We are defining the term 
``total and permanent loss of hearing'' at 38 CFR 9.20(e)(6)(xvi) to 
mean average hearing threshold sensitivity for air conduction of at 
least 80 decibels that is clinically stable and unlikely to improve and 
based upon hearing measured at 500, 1000, and 2000 Hertz. According to 
the American Speech-Language-Hearing Association, a hearing loss is 
considered ``profound'' if it measures at 80 decibels. https://
www.asha.org/public/hearing/testing/assess.htm. We are adding this 
definition to provide an objective standard for determining whether a 
hearing loss is total and permanent for purposes of TSGLI.
    In Sec.  9.20(e)(6)(xv), we are defining the term ``total and 
permanent loss of speech,'' used in Sec.  9.20(f)(3), as ``organic loss 
of speech or the ability to express oneself, both by voice and whisper,

[[Page 71928]]

through normal organs for speech, notwithstanding the use of an 
artificial appliance to simulate speech.'' The loss of speech must be 
clinically stable and unlikely to improve in order to be compensable. 
We are adding this objective definition to assist the medical 
professionals who evaluate injured service members for purposes of 
entitlement to TSGLI.
    We are adding uniplegia as a qualifying loss for TSGLI at Sec.  
9.20(f)(7) and defining ``uniplegia'' at 38 CFR 9.20(e)(6)(iv) as ``the 
complete and irreversible paralysis of one limb of the body.'' The 
Year-One Review states that research shows that the impact of 
rehabilitation and recovery for uniplegia is similar to the 
rehabilitation and recovery from severance of a hand or foot, which 
Congress included as a scheduled loss under 38 U.S.C. 1980A(b)(1)(B). 
Year-One Review at 24. The AD&D policies of the commercial sector, upon 
which TSGLI was modeled, also often cover uniplegia. We are therefore 
including uniplegia as a scheduled loss for purposes of TSGLI. Because 
uniplegia involves paralysis of one limb only, and is therefore less 
severe a loss than paralysis that involves more than one limb, and 
because of the reported similar effect of the amputation of one hand or 
foot, the payment for this loss is $50,000, which is the amount of 
TSGLI payable for amputation of one hand or one foot. However, we note 
in the Schedule that a payment for uniplegia cannot be combined with 
the payments for amputation or limb salvage, as the initial payment for 
the uniplegia loss provides payment to the service member during the 
rehabilitation period.
    We are adding a definition of ``complete and irreversible 
paralysis'' to aid in understanding the definitions of quadriplegia, 
paraplegia, hemiplegia, and uniplegia. ``Complete and irreversible 
paralysis'' is defined in Sec.  9.20(e)(6)(v) as total loss of 
voluntary movement resulting from damage to the spinal cord or 
associated nerves, or to the brain, that is deemed clinically stable 
and unlikely to improve.
    In Sec.  9.20(e)(6)(xvii) and (f)(8), we are expanding TSGLI 
coverage from third degree or worse burns covering at least 30 percent 
of the body or 30 percent of the face to second degree or worse burns 
covering at least 20 percent of a service member's body or at least 20 
percent of the face. Although 38 U.S.C. 1980A(b)(1)(G) states that the 
Schedule of Losses prescribed by the Secretary of Veterans Affairs must 
include ``[b]urns greater than second degree, covering 30 percent of 
the body or 30 percent of the face,'' the statute also authorizes the 
Secretary of Veterans Affairs to prescribe additional losses by 
regulation. We therefore believe that VA has authority to add other 
kinds of burns to the TSGLI Schedule of Losses.
    Second degree burns, also called partial thickness burns, are less 
severe than third degree burns, also called full thickness burns. 
Nevertheless, burn specialists at Brooke Army Medical Center and VA 
physicians indicated that a second degree burn to at least 20 percent 
of the face or body would be considered to be a severe burn. Year-One 
Review at 26. They also reported that patients with second degree burns 
require as much rehabilitation as those with third degree burns. Id. We 
are therefore providing a TSGLI payment of $100,000 for second degree 
burns or worse covering at least 20 percent of the body or at least 20 
percent of the face. The definition of burns in Sec.  9.20(e)(6)(xvii) 
states explicitly that the body includes the face and head. The 
percentage of the body burned will be determined by using the Rule of 
Nines, which is a chart dividing the body surface into areas, each of 
which represents 9 percent, or another method for estimating the extent 
of a member's burns that is generally accepted within the medical 
profession.
    We are replacing the phrase ``loss of'' hand or foot in the 
schedule with ``amputation of,'' and we define ``amputation'' in Sec.  
9.20(e)(6)(xx) to mean ``severance or removal of a limb or part of a 
limb resulting from trauma or surgery.'' We also explain that, ``[a]n 
amputation above a joint means a severance or removal that is closer to 
the body than the specified joint is.'' (Emphasis added.)
    TSGLI coverage under the schedule will be expanded with respect to 
amputation of part of a limb. For amputation of part of the hand, we 
are adding at Sec.  9.20(f)(10) amputation of the thumb or the other 
four fingers at or above the metacarpophalangeal joint, for which 
$50,000 in TSGLI is payable. For amputation of part of the foot, we are 
adding at Sec.  9.20(f)(12) amputation at or above the 
metatarsophalangeal joints of all toes on one foot, for which the TSGLI 
payment is $50,000, and at Sec.  9.20(f)(13) amputation of the big toe 
or the four other toes, for which the TSGLI payment is $25,000.
    We are expanding both the hand and foot scheduled losses because 
the TSGLI Year-One Review Team found that there have been cases of 
significant injuries involving loss of part of a hand or foot that did 
not qualify for payment under the current TSGLI Schedule of Losses. 
Year-One Review at 25. Currently, the schedule provides a payment for 
loss of an entire hand or foot or for loss of an index finger and thumb 
of the same hand. Interviews and medical research indicated that 
amputations involving four fingers on one hand, a thumb, four toes on 
one foot, or a big toe required at least short-term rehabilitation. Id. 
Interviews with the branches of service TSGLI administrative office 
staff, as well as staff at National Naval Medical Center, Walter Reed 
Army Medical Center, and Brooke Army Medical Center all documented the 
significance of these losses. Id. The medical literature affirms the 
key role that the thumb and other fingers play in activities of daily 
living that require grasping and other fine motor skills. Id. The toes 
function similarly in terms of balance and propulsion for walking. Id. 
Additionally, many AD&D policies in the commercial sector now typically 
include coverage for loss of fingers and toes. Id.
    We are adding limb salvage of an arm or leg to the Schedule of 
Losses at Sec.  9.20(f)(14) and (15) and defining the term `` limb 
salvage'' at Sec.  9.20(e)(6)(xix) as ``a series of operations designed 
to save an arm or leg with all of its associated parts rather than 
amputate it.'' Eligibility for TSGLI based on salvage of an arm or leg 
will require a surgeon's certification that the option of amputation of 
the limb was a medically justified alternative to salvage and that the 
service member chose to pursue salvage. The TSGLI payment for salvage 
of an arm or leg is $50,000, the same amount payable under the schedule 
for loss of a hand or foot. According to the Year-One Review, surgeons 
at the National Naval Medical Center and Brooke Army Medical Center 
stated that limb salvage requires more significant rehabilitation than 
an amputation. Year-One Review at 25-26. These medical professionals 
also raised the issue that providing a TSGLI payment for amputations 
but not limb salvage could create a monetary incentive that would 
unintentionally encourage a service member to proceed with amputation 
rather than attempt to save the limb. Id. By adding limb salvage as a 
covered loss, the TSGLI program will obviate this possibility and also 
recognize the severity of the rehabilitation that members undergo when 
they elect to pursue limb salvage.
    We are adding facial reconstruction to the Schedule of Losses at 
Sec.  9.20(f)(16). Consultation with medical experts in the field of 
oral and maxillofacial surgery during the Year-One Review indicated 
that 20-25 percent of all injuries to members serving in Operation 
Enduring Freedom/Operation Iraqi Freedom occur to the head, face,

[[Page 71929]]

and neck. Year-One Review at 29. The experts also opined that these 
injuries are significantly more severe than in the civilian world 
because they often result in severe functional losses, including 
impairment in areas such as eating, breathing, digestion, vision, and 
salivation that require significant recovery and rehabilitation but do 
not result in a loss of the member's ability to carry out activities of 
daily living that would be covered in the current Schedule of Losses. 
Id. New Sec.  9.20(f)(16) provides a graduated scale of payments for 
facial reconstruction, starting at $25,000, with a maximum payment of 
$75,000. The amount of the payment for facial reconstruction is based 
on the location and severity of the injury. The regulation, however, 
excludes TSGLI for relatively minor injuries to the face, such as the 
loss of the tip of the nose, because TSGLI is intended for traumatic 
injuries that require complex surgeries and rehabilitation, as 
evidenced by the losses prescribed at 38 U.S.C. 1980A(b)(1).
    In Sec.  9.20(e)(6)(xviii), we are defining ``coma,'' as used in 
Sec.  9.20(f)(17) to mean ``a state of profound unconsciousness that is 
measured at a Glasgow Coma Score of 8 or less.'' The Glasgow Coma Score 
is a neurological scale comprised of the combined score on tests of a 
patient's eye, verbal, and motor responses and ranges between 3 
(indicating deep unconsciousness) and 15 (widely awake). https://
www.unc.edu/~rowlett/units/scales/glasgow.htm. The scale is applicable 
to acute medical and trauma patients and is also used for chronic 
conditions. https://www.bt.cdc.gov/masscasualties/gscale.asp. Use of the 
Glasgow Coma Score will provide a reliable, objective way of assessing 
the conscious state of a service member.
    We are adding to the schedule at Sec.  9.20(f)(18) and (20) a 
$25,000 TSGLI payment for hospitalization due to traumatic brain injury 
(TBI) or other traumatic injury (OTI) if the service member's TBI or 
OTI results in 15 consecutive days of inpatient hospitalization, and we 
define ``hospitalization'' in Sec.  9.20(e)(6)(xiii) to mean an 
inpatient stay in a facility that is: (1) Accredited by the Joint 
Commission or its predecessor, the Joint Commission on Accreditation of 
Healthcare Organizations (JCAHO), or accredited or approved by a 
program of the qualified governmental unit in which such institution is 
located if the Secretary of Health and Human Services has found that 
the accreditation or comparable approval standards of such qualified 
governmental unit are essentially equivalent to those of the Joint 
Commission or JCAHO; (2) used primarily to provide, by or under the 
supervision of physicians, to inpatients' diagnostic services and 
therapeutic services for medical diagnosis, treatment, and care of 
injured, disabled, or sick persons; (3) requires every patient to be 
under the care and supervision of a physician; and (4) provides 24-hour 
nursing services rendered or supervised by a registered professional 
nurse and has a licensed practical nurse or registered nurse on duty at 
all times. The definition of hospitalization also includes any Armed 
Forces medical facility that is authorized to provide inpatient and/or 
ambulatory care to eligible service members. The definition is intended 
to exclude facilities that do not provide traditional hospital-level 
care unless the limitation on the level of care is a result of military 
necessity. The requisite consecutive 15-day hospitalization period 
includes the dates on which the member is transported from the injury 
site to a facility described above, admitted to the facility, 
transferred between such facilities, and discharged from the facility.
    A service member is not entitled to receive both a TSGLI payment 
for a 15-day hospitalization due to TBI under Sec.  9.20(f)(18) and a 
$25,000 TSGLI payment for TBI that causes the inability to perform at 
least two activities of daily living under Sec.  9.20(f)(17). Also, a 
service member is not entitled to receive both a TSGLI payment for a 
15-day hospitalization due to OTI under Sec.  9.20(f)(20) and a $25,000 
payment for a traumatic injury causing the inability to perform at 
least two activities of daily living under Sec.  9.20(f)(19).
    By adding this loss, we will allow injured service members whose 
inability to perform activities of daily living cannot be documented in 
the early stages following their traumatic injury to nonetheless 
establish the consequences of the injury via easily obtainable 
information regarding the length of their hospital stay. We also 
believe that establishing this scheduled loss will result in more 
consistent decisions and more rapid payments in cases involving TBI. In 
considering the Schedule of Losses award for TBI, we considered not 
only the length of the loss of the activities of daily living, but the 
fact that there was an underlying injury to the brain.
    Hospitalization for 15 consecutive days or more in today's health 
care environment generally indicates a rather severe injury. Such a 
severe injury usually requires the member's family or other caregivers 
to assist the member in their recovery.
    In 38 CFR 9.20(h)(1)(i), (ii), and (iii) and (2) we refer to an 
``Application for TSGLI Benefits Form,'' rather than the 
``Certification of Traumatic Injury Protection Form,'' in order to 
conform to the current name of the document. In 38 CFR 9.20(h)(1)(ii) 
we are adding ``agent'' in order to broaden the types of persons who 
may receive a TSGLI payment on behalf of a member, and we are changing 
``attorney in fact'' to ``attorney.''
    We are amending 38 CFR 9.20(h)(1)(ii) and 38 CFR 9.20(j) to 
implement 38 U.S.C. 1980A(k), which provides:

    The Secretary [of the appropriate branch of service], in 
consultation with the Secretary [of Veterans Affairs], shall develop 
a process for the designation of a fiduciary or trustee of a member 
of the uniformed services who is insured against traumatic injury 
under [the TSGLI program]. The fiduciary or trustee so designated 
would receive a payment for a qualifying loss under [the TSGLI 
program] if the member is medically incapacitated (as determined 
pursuant to regulations prescribed by the Secretary [of the 
appropriate branch of service] in consultation with the Secretary 
[of Veterans Affairs]) or experiencing an extended loss of 
consciousness.

Section 602 of title 37, United States Code, authorizes the Secretary 
of a military department to designate a person to receive amounts due a 
member ``who is mentally incapable of managing his affairs * * * 
without the appointment in judicial proceedings of a committee, 
guardian, or other legal representative.'' In Sec.  9.20(j)(2) we are 
adding a new paragraph that provides that, if a member does not have a 
guardian or agent (also known as ``attorney-in-fact'') who is 
authorized to act as the member's legal representative, then a trustee 
appointed under 37 U.S.C. 602 may be authorized to receive a TSGLI 
payment on behalf of the member and is also obligated to render a full 
accounting of any disbursements made from the TSGLI benefit in 
accordance with Department of Defense regulations implementing section 
602. See 37 U.S.C. 603. In order to achieve Congress' obvious intent in 
enacting 38 U.S.C. 1980A(k) of providing TSGLI to legally incapacitated 
service members and their families who are entitled to the payment as 
soon as possible, we are amending 38 CFR 9.20(h)(1)(ii) to provide that 
a military trustee may apply for and receive TSGLI on behalf of a 
legally incapacitated member.

Administrative Procedure Act

    In accordance with 5 U.S.C. 553(b)(3)(B), the Secretary of Veterans 
Affairs finds that there is good cause to

[[Page 71930]]

dispense with the opportunity for prior notice and opportunity for 
public comment with respect to this rule, which explains how the TSGLI 
program will be amended. The Secretary finds that it is impracticable 
to delay this regulation for the purpose of soliciting prior public 
comment because service members and their families need the payment 
provided by TSGLI as soon as possible following a traumatic injury in 
order to reduce the financial burden that results from the severe 
losses covered by the schedule. The amendments would be applied 
retroactively for losses previously not covered that result from 
injuries that occurred on or after October 1, 2001. As a result, we 
estimate that approximately 1640 service members who were not 
previously eligible for TSGLI would now be entitled to a payment under 
these amended rules and are in need of these payments as soon as 
possible. For these reasons, the Secretary of Veterans Affairs is 
issuing this rule as an interim final rule. The Secretary of Veterans 
Affairs will consider and address comments that are received within 30 
days of the date this interim final rule is published in the Federal 
Register.

Unfunded Mandates

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

Paperwork Reduction Act

    OMB assigns a control number for each collection of information it 
approves. Except for emergency approvals under 44 U.S.C. 3507(j), VA 
may not conduct or sponsor, and a person is not required to respond to, 
a collection of information unless it displays a currently valid OMB 
control number. This interim final rule expands the collection of 
information under the Paperwork Reduction Act (44 U.S.C. 3501-3521) 
(the Act). Accordingly, under section 3507(d) of the Act, VA will 
submit a copy of the amended TSGLI form (titled Application for TSGLI 
Benefits Form) to OMB for its review of the collections of information 
concurrent with the publication of this interim final rule.

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 proposed rule have been examined, and it has been 
determined to be a significant regulatory action under the Executive 
Order 12866.

Regulatory Flexibility Act

    The Secretary of Veterans Affairs hereby certifies that this 
interim final rule will not have a significant economic impact on a 
substantial number of small entities as they are defined in the 
Regulatory Flexibility Act, 5 U.S.C. 601 et seq. This interim final 
rule will directly affect only individuals and will not directly affect 
small entities. Therefore, pursuant to 5 U.S.C. 605(b), this amendment 
is exempt from the initial and final regulatory flexibility analysis 
requirements of sections 603 and 604.

Catalog of Federal Domestic Assistance Number and Title

    The Catalog of Federal Domestic Assistance Program number and title 
for this regulation is 64.103, Life Insurance for Veterans.

List of Subjects in Part 9

    Life insurance, Military personnel, Veterans.

    Approved: October 10, 2008.
James B. Peake,
Secretary of Veterans Affairs.

0
For the reasons stated in the preamble, the Department of Veterans 
Affairs is amending 38 CFR part 9 as follows:

PART 9--SERVICEMEMBERS' GROUP LIFE INSURANCE AND VETERANS' GROUP 
LIFE INSURANCE

0
1. The authority citation for part 9 is revised to read as follows:

    Authority: 38 U.S.C. 501, 1965-1980A, unless otherwise noted.


0
2. Section 9.1 is amended by:
0
a. Revising paragraph (b).
0
b. Removing paragraphs (k) through (q).
    The revision reads as follows:


Sec.  9.1  Definitions.

* * * * *
    (b) The term administrative office means the Office of 
Servicemembers' Group Life Insurance, located at 80 Livingston Avenue, 
Roseland, New Jersey 07068.
* * * * *

0
3. Section 9.20 is amended by:
0
a. Revising paragraph (b)(3).
0
b. Adding paragraph (d)(5).
0
c. Revising paragraphs (e)(3)(i)(C) and (D).
0
d. Removing paragraph (e)(5)(ii) and redesignating paragraph 
(e)(5)(iii) as new paragraph (e)(5)(ii).
0
e. Revising paragraphs (e)(6)(i) through (iii).
0
f Adding paragraphs (e)(6)(iv), through (xx).
0
g. Removing paragraph (e)(7).
0
h. Redesignating paragraphs (f) through (j) as (g) through (k), 
respectively.
0
i. Adding new paragraph (f).
0
j. Revising newly designated paragraph (h).
0
k. Revising newly designated paragraph (j)(1).
0
l. Redesignating newly redesignated paragraph (j)(2) as (j)(3) and 
adding a new paragraph (j)(2).
0
m. Revising the authority citation.
    The revisions and additions read as follows:


Sec.  9.20  Traumatic injury protection.

* * * * *
    (b) * * *
    (3) A traumatic event does not include a medical or surgical 
procedure in and of itself.
* * * * *
    (d) * * *
    (5) You must suffer a traumatic injury before midnight on the date 
of termination of your duty status in the

[[Page 71931]]

uniformed services that established eligibility for Servicemembers' 
Group Life Insurance. For purposes of this section, the scheduled loss 
may occur after the date of termination of your duty status in the 
uniformed services that established eligibility for Servicemembers' 
Group Life Insurance.
    (e)* * *
    (3) * * *
    (i) * * *
    (C) Diagnostic procedures, preventive medical procedures such as 
inoculations, medical or surgical treatment for an illness or disease, 
or any complications arising from such procedures or treatment;
    (D) Willful use of an illegal substance or a controlled substance 
unless administered or consumed on the advice of a medical 
professional; or
* * * * *
    (6) Definitions. For purposes of this section--
    (i) The term quadriplegia means the complete and irreversible 
paralysis of all four limbs.
    (ii) The term paraplegia means the complete and irreversible 
paralysis of both lower limbs.
    (iii) The term hemiplegia means the complete and irreversible 
paralysis of the upper and lower limbs on one side of the body.
    (iv) The term uniplegia means the complete and irreversible 
paralysis of one limb of the body.
    (v) The term complete and irreversible paralysis means total loss 
of voluntary movement resulting from damage to the spinal cord or 
associated nerves, or to the brain, that is deemed clinically stable 
and unlikely to improve.
    (vi) The term inability to carry out activities of daily living 
means the inability to independently perform at least two of the six 
following functions:
    (A) Bathing.
    (B) Continence.
    (C) Dressing.
    (D) Eating.
    (E) Toileting.
    (F) Transferring in or out of a bed or chair with or without 
equipment.
    (vii) The term pyogenic infection means a pus-producing infection.
    (viii) The term contaminated substance means food or water made 
unfit for consumption by humans because of the presence of chemicals, 
radioactive elements, bacteria, or organisms.
    (ix) The term chemical weapon means chemical substances intended to 
kill, seriously injure, or incapacitate humans through their 
physiological effects.
    (x) The term biological weapon means biological agents or 
microorganisms intended to kill, seriously injure, or incapacitate 
humans through their physiological effects.
    (xi) The term radiological weapon means radioactive materials or 
radiation-producing devices intended to kill, seriously injure, or 
incapacitate humans through their physiological effects.
    (xii) The term medical professional means a licensed practitioner 
of the healing arts acting within the scope of his or her practice. 
Some examples include a licensed physician, optometrist, nurse 
practitioner, registered nurse, physician assistant, or audiologist.
    (xiii) The term hospitalization means an inpatient stay in a 
facility that is:
    (A)(1) Accredited by the Joint Commission or its predecessor, the 
Joint Commission on Accreditation of Healthcare Organizations (JCAHO), 
or accredited or approved by a program of the qualified governmental 
unit in which such institution is located if the Secretary of Health 
and Human Services has found that the accreditation or comparable 
approval standards of such qualified governmental unit are essentially 
equivalent to those of the Joint Commission or JCAHO;
    (2) Used primarily to provide, by or under the supervision of 
physicians, to inpatients diagnostic services and therapeutic services 
for medical diagnosis, treatment, and care of injured, disabled, or 
sick persons;
    (3) Requires every patient to be under the care and supervision of 
a physician; and
    (4) Provides 24-hour nursing services rendered or supervised by a 
registered professional nurse and has a licensed practical nurse or 
registered nurse on duty at all times; or
    (B) Any Armed Forces medical facility that is authorized to provide 
inpatient and/or ambulatory care to eligible service members.
    (xiv) The term total and permanent loss of sight means:
    (A) Visual acuity in the eye of 20/200 or less (worse) with 
corrective lenses lasting at least 120 days;
    (B) Visual acuity in the eye of greater (better) than 20/200 with 
corrective lenses and a visual field of 20 degrees or less lasting at 
least 120 days; or
    (C) Anatomical loss of the eye.
    (xv) The term total and permanent loss of speech means organic loss 
of speech or the ability to express oneself, both by voice and whisper, 
through normal organs for speech, notwithstanding the use of an 
artificial appliance to simulate speech. Loss of speech must be 
clinically stable and unlikely to improve.
    (xvi) The term total and permanent loss of hearing means average 
hearing threshold sensitivity for air conduction of at least 80 
decibels, based on hearing acuity measured at 500, 1,000, and 2,000 
Hertz, that is clinically stable and unlikely to improve.
    (xvii) The term burns means 2nd degree (partial thickness) or worse 
burns covering at least 20 percent of the body, including the face and 
head, or 20 percent of the face alone. Percentage of the body burned 
may be measured using the Rule of Nines or any means generally accepted 
within the medical profession.
    (xviii) The term coma means a state of profound unconsciousness 
that is measured at a Glasgow Coma Score of 8 or less.
    (xix) The term limb salvage means a series of operations designed 
to save an arm or leg with all of its associated parts rather than 
amputate it. For purposes of this section, a surgeon must certify that 
the option of amputation of the limb(s) was a medically justified 
alternative to salvage, and the patient chose to pursue salvage.
    (xx) The term amputation means the severance or removal of a limb 
or part of a limb resulting from trauma or surgery. An amputation above 
a joint means a severance or removal that is closer to the body than 
the specified joint is.
* * * * *
    (f) Schedule of Losses.

[[Page 71932]]

[GRAPHIC] [TIFF OMITTED] TR26NO08.009


[[Page 71933]]


[GRAPHIC] [TIFF OMITTED] TR26NO08.010


[[Page 71934]]


[GRAPHIC] [TIFF OMITTED] TR26NO08.011

* * * * *
    (h) How does a member make a claim for traumatic injury protection 
benefits? (1)(i) A member who believes he or she qualifies for 
traumatic injury protection benefits must complete Part A of the 
Application for TSGLI Benefits Form and sign the form.
    (ii) If a member is unable to sign the Application for TSGLI 
Benefits Form due to the member's physical or mental incapacity, the 
form must be signed by the member's guardian; if none, the member's 
agent or attorney acting under a valid Power of Attorney; if none, the 
member's military trustee.
    (iii) If a member suffered a scheduled loss as a direct result of 
the traumatic injury, survived seven full days from the date of the 
traumatic event, and then died before the maximum benefit for which the 
service member qualifies is paid, the beneficiary or beneficiaries of 
the member's Servicemembers' Group Life Insurance policy should 
complete an Application for TSGLI Benefits Form.
    (2) If a member seeks traumatic injury protection benefits for a 
scheduled loss occurring after submission of a completed Application 
for TSGLI Benefits Form for a different scheduled loss, the member must 
submit a completed Application for TSGLI Benefits Form for the new 
scheduled loss and for each scheduled loss that occurs thereafter and 
for each increment of a scheduled loss that occurs thereafter. For 
example, if a member seeks traumatic injury protection benefits for a 
scheduled loss due to coma from traumatic injury and/or the inability 
to carry out activities of daily living due to traumatic brain injury 
(Sec.  9.20(f)(17)), or the inability to carry out activities of daily 
living due to loss directly resulting from a traumatic injury other 
than an injury to the brain (Sec.  9.20(f)(19)), a completed 
Application for TSGLI Benefits Form must be submitted for each 
increment of time for which TSGLI is payable. Also, for example, if a 
service member suffers a scheduled loss due to a coma, a completed 
Application for TSGLI

[[Page 71935]]

Benefits Form should be filed after the 15th consecutive day that the 
member is in the coma, for which $25,000 is payable. If the member 
remains in a coma for another 15 days, another completed Application 
for TSGLI Benefits Form should be submitted and another $25,000 will be 
paid.
* * * * *
    (j) Who will be paid the traumatic injury protection benefit? The 
injured member who suffered a scheduled loss will be paid the traumatic 
injury protection benefit in accordance with title 38 U.S.C. 1980A 
except under the following circumstances:
    (1) If a member is legally incapacitated, the member's guardian or 
agent or attorney acting under a valid Power of Attorney will be paid 
the benefit on behalf of the member.
    (2) If no guardian, agent, or attorney is authorized to act as the 
member's legal representative, a military trustee who has been 
appointed under the authority of 37 U.S.C. 602 will be paid the benefit 
on behalf of the member. The military trustee will report the receipt 
of the traumatic injury benefit payment and any disbursements from that 
payment to the Department of Defense.
* * * * *

(Authority: 37 U.S.C. 602, 603; 38 U.S.C. 501(a), 1980A)

[FR Doc. E8-28114 Filed 11-25-08; 8:45 am]
BILLING CODE 8320-01-P