Veterans' Benefits Improvements Act of 1996

DEPARTMENT OF VETERANS AFFAIRS

38 CFR Part 3

RIN 2900-AI66

Veterans' Benefits Improvements Act of 1996

AGENCY: Department of Veterans Affairs.

ACTION: Final rule.

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SUMMARY: This document amends Department of Veterans Affairs (VA)

adjudication regulations concerning: The clothing allowance based on

certain service-connected disabilities; the dates of the Vietnam era;

the payment of benefits to a surviving spouse for the month in which

the veteran dies; the period for which accrued benefits are payable;

and burial allowance eligibility. The intended effect of this amendment

is to bring VA regulations into conformance with statutory revisions

contained in the Veterans' Benefits Improvements Act of 1996.

DATES: Effective Date: October 9, 1996, except for amendments to

Secs. 3.2(f) and 3.307(a)(6), which are effective January 1, 1997.

Applicability: The amendments to 38 CFR 3.20 apply to the deaths of

compensation and pension recipients that occur after December 31, 1996.

The Amendment to 38 CFR 3.1000 applies to claims for accrued benefits

based on deaths that occurred before October 9, 1996, and that were not

finally decided before then, as well as to claims based on deaths that

occurred after then.

FOR FURTHER INFORMATION CONTACT: John Bisset, Jr., Consultant,

Regulations Staff, Compensation and Pension Service, Veterans Benefits

Administration, 810 Vermont Avenue, NW, Washington, DC 20420, telephone

(202) 273-7230.

SUPPLEMENTARY INFORMATION: Under the provisions of 38 U.S.C. 1162, VA

pays a clothing allowance to each veteran who, because of a service-

connected disability, either wears or uses a prosthetic or orthopedic

appliance which tends to wear out or tear the veteran's clothing, or

uses a medication prescribed for a skin condition due to a service-

connected disability and which causes irreparable damage to the

veteran's outer clothing. Although 38 U.S.C. 5313 limits the amount of

compensation or dependency and indemnity compensation that is payable

to any person who is incarcerated in a Federal, State, or local penal

institution for a period in excess of 60 days for conviction of a

felony, there was no such restriction on payment of the clothing

allowance.

Section 502 of the Veterans' Benefits Improvements Act of 1996,

Public Law 104-275, amended 38 U.S.C. Chap. 53 to reduce the amount of

the clothing allowance payable under 38 U.S.C. 1162 to veterans who are

incarcerated in a Federal, State, or local penal institution for a

period in excess of 60 days and who are furnished clothing without

charge by the institution. Under this amendment, VA is required to

reduce the amount of the clothing allowance by an amount equal to 1/365

of the amount of the allowance otherwise payable for each day on which

the veteran was incarcerated during the 12-month period preceding the

date on which payment of the clothing allowance would be due. VA is

amending 38 CFR 3.810 to reflect this statutory change.

The Vietnam era was defined as the period August 5, 1964, through

May 7, 1975, inclusive (See 38 CFR 3.2(f)). Section 505 of Public Law

104-275 amended 38 U.S.C. 101(29) to expand the Vietnam era to the

period beginning on February 28, 1961, and ending on May 7, 1975, but

only for veterans who served in the Republic of Vietnam during that

period. Public Law 104-275 also amended 38 U.S.C. 1116(a) to expand the

period during which veterans must have served in Vietnam to be entitled

to the application of certain presumptions relating to exposure to

certain herbicide agents and the service connection of associated

diseases to the period beginning January 9, 1962, and ending on May 7,

1975. VA is amending 38 CFR 3.2(f) and 3.307(a)(6) to reflect these

statutory changes, which are effective January 1, 1997.

Under the provisions of 38 U.S.C. 5310, a veteran's surviving

spouse who

[[Page 35422]]

is entitled to death benefits for the month of the veteran's death gets

an amount not less than the amount which the veteran would have

received for that month but for his or her death. Section 506 of Pub.

L. 104-275 revised 38 U.S.C. 5310 to allow a surviving spouse who is

not entitled to death benefits for the month of the veteran's death to

receive a benefit in an amount equal to the amount which the veteran

would have received for that month but for his or her death. It further

provided that a compensation or pension payment issued to a veteran for

the month of death shall be treated as being payable to a surviving

spouse who is entitled to this new benefit and that if the payment is

negotiated or deposited it will be considered as the benefit due the

surviving spouse. However, if the payment is less than the amount the

veteran would have received for the month of death, the statute

requires that the unpaid amount be treated as an accrued benefit (See

38 U.S.C. 5121 and 38 CFR 3.1000). The changes made by section 506 of

Public Law 104-275 apply to deaths occurring after December 31, 1996.

VA is amending 38 CFR 3.20 to reflect these statutory changes.

Under the provisions of 38 U.S.C. 5121, when an individual eligible

for VA periodic monetary benefits dies, the amount of benefits due but

unpaid at death may be paid either to certain survivors or as a

reimbursement to the person who bore the expense of the individual's

last illness and burial. The amount of accrued benefits payable was

limited to the amount due for a period not to exceed one year prior to

the date of death. Section 507 of Public Law 104-275 revised this to

the amount due for a period not to exceed two years prior to the date

of death. VA is amending 38 CFR 3.1000(a) to reflect this statutory

change.

Under the provisions of 38 U.S.C. 2303, VA pays burial benefits on

behalf of a veteran who dies in a VA facility to which he or she was

admitted for hospital, nursing home, or domiciliary care, or who dies

in an institution at which he or she was receiving hospital or nursing

home care at the expense of the United States at the time of death.

Section 212 of Public Law 104-275 amended 38 U.S.C. 2303 to provide

burial benefits for certain veterans who die in State nursing homes. VA

is amending 38 CFR 3.1600(c) to reflect this statutory change, to

correct an obsolete reference to 38 U.S.C. 1701(4), and to include

within the scope of the term ``hospitalized by VA'' contract hospital

care under 38 U.S.C. 1703. These amendments merely conform the

regulations to the governing statutory provisions.

VA is issuing a final rule to make the above described amendments.

Because these amendments merely reflect statutory changes, publication

as a proposal for public comment is unnecessary.

Because no notice of proposed rulemaking was required in connection

with the adoption of this final rule, no regulatory flexibility

analysis is required under the Regulatory Flexibility Act (5 U.S.C.

601-612). Even so, 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.

The Catalog of Federal Domestic Assistance program numbers are

64.104, 64.105, 64.109, and 64.110.

List of Subjects in 38 CFR Part 3

Administrative practice and procedure, Claims, Disability benefits,

Health care, Pensions, Veterans, Vietnam.

Approved: April 28, 1997.

Jesse Brown,

Secretary of Veterans Affairs.

For the reasons set forth in the preamble, 38 CFR part 3 is amended

as follows:

PART 3--ADJUDICATION

Subpart A--Pension, Compensation, and Dependency and Indemnity

Compensation

1. The authority citation for part 3, subpart A, continues to read

as follows:

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

2. In Sec. 3.2, paragraph (f) is revised to read as follows:

Sec. 3.2 Periods of war.

* * * * *

(f) Vietnam era. The period beginning on February 28, 1961, and

ending on May 7, 1975, inclusive, in the case of a veteran who served

in the Republic of Vietnam during that period. The period beginning on

August 5, 1964, and ending on May 7, 1975, inclusive, in all other

cases.

(Authority: 38 U.S.C. 101(29))

* * * * *

3. In Sec. 3.20, paragraph (c) is added to read as follows:

Sec. 3.20 Surviving spouse's benefit for month of veteran's death.

* * * * *

(c)(1) Where a veteran receiving compensation or pension dies after

December 31, 1996, the surviving spouse, if not entitled to death

compensation, dependency and indemnity compensation, or death pension

for the month of death, shall be entitled to a benefit for that month

in an amount equal to the amount of compensation or pension the veteran

would have received for that month but for his or her death.

(2) A payment issued to a deceased veteran as compensation or

pension for the month in which death occurred shall be treated as

payable to that veteran's surviving spouse, if the surviving spouse is

not entitled to death compensation, dependency and indemnity

compensation or death pension for that month and, if negotiated or

deposited, shall be considered to be the benefit to which the surviving

spouse is entitled under paragraph (c)(1) of this section. However, if

such payment is in an amount less than the amount of the benefit under

paragraph (c)(1) of this section, the unpaid difference shall be

treated in the same manner as an accrued benefit under Sec. 3.1000 of

this part.

(Authority: 38 U.S.C. 5310(b))

Sec. 3.307 [Amended]

4. In Sec. 3.307, paragraphs (a)(6)(i) and (a)(6)(iii) are amended

by removing ``during the Vietnam era'' wherever it appears, and adding,

in its place, ``during the period beginning on January 9, 1962, and

ending on May 7, 1975'', and by adding an authority citation at the end

of paragraph (a)(6)(i) and by revising the authority citation to

paragraph (a)(6)(iii) to read as follows:

Sec. 3.307 Presumptive service connection for chronic, tropical or

prisoner-of-war related disease, or disease associated with exposure to

certain herbicide agents; wartime and service on or after January 1,

1947.

(a) * * *

(6) * * *

(i) * * *

(Authority: 38 U.S.C. 1116(a)(4))

* * * * *

(iii) * * *

(Authority: 38 U.S.C. 501(a) and 1116(a)(3))

* * * * *

Sec. 3.810 [Amended]

5. In Sec. 3.810, paragraph (a), the first sentence, is amended by

removing ``A'' and adding, in its place, ``Except as provided in

paragraph (d) of this section a''; and paragraph (d) is added after the

authority citation following paragraph (c) to read as follows:

[[Page 35423]]

Sec. 3.810 Clothing allowance.

* * * * *

(d) If a veteran is incarcerated in a Federal, State, or local

penal institution for a period of more than 60 days and is furnished

clothing without charge by the institution, VA shall reduce the amount

of the annual clothing allowance by 1/365th of the amount otherwise

payable for each day the veteran was incarcerated during the 12-month

period preceding the anniversary date for which entitlement is

established. No reduction shall be made for the first 60 days of

incarceration.

(Authority: 38 U.S.C. 5313A)

Sec. 3.1000 [Amended]

6. In Sec. 3.1000, the introductory text of paragraph (a) is

amended by removing ``1 year'' and adding, in its place, ``2 years'',

and by adding an authority citation to read as follows:

Sec. 3.1000 Under 38 U.S.C. 5121.

(a) * * *

(Authority: 38 U.S.C. 5121(a)

* * * * *

Sec. 3.1600 [Amended]

7. In Sec. 3.1600, paragraph (c), the second sentence is amended by

removing ``(as defined in 38 U.S.C. 1701(4))'' and adding, in its

place, ``(as described in 38 U.S.C. 1701(3))''; by removing ``1711(a),

or'' and adding, in its place, ``1711(a); admission (transfer) to a

non-VA facility (as described in 38 U.S.C. 1701(4)) for hospital care

under the authority of 38 U.S.C. 1703;'' and by removing ``United

States.'' and adding, in its place, ``United States; or admission

(transfer) to a State nursing home for nursing home care with respect

to which payment is authorized under the authority of 38 U.S.C.

1741.''.

[FR Doc. 97-17226 Filed 6-30-97; 8:45 am]

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