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Some Rules For Reduction In Compensation




VA is required to comply with several general VA regulations applicable to all rating-reduction cases, regardless of the rating level or the length of time that the rating has been in effect. 38 C.F.R. §§ 4.1, 4.2, 4.10, 4.13 (2008); see also Brown v. Brown, 5 Vet. App. 413, 420 (1993).

These provisions impose a clear requirement that VA rating reductions be based upon review of the entire history of the veteran's disability. See Schafrath v. Derwinski, 1 Vet. App. 589, 594 (1991).

Such review requires VA to ascertain, based upon review of the entire recorded history of the

condition, whether the evidence reflects an actual change in the disability and whether the examination reports reflecting such change are based upon thorough examinations.

Thus, in any rating-reduction case, to include SMC, not only must it be determined that an improvement in a disability has actually occurred but also that that improvement actually

reflects an improvement in the veteran's ability to function under the ordinary conditions of life

and work. See Faust v. West, 13 Vet. App. 342, 350 (2000).

In certain rating reduction cases, VA benefits recipients are to be afforded greater protections, set forth in 38 C.F.R. § 3.344 (2008).

That section provides that rating agencies will handle cases affected by change of medical findings or diagnosis, so as to produce the greatest degree of stability of disability evaluations consistent with the laws and VA regulations governing disability compensation and pension.

However, the provisions of 38 C.F.R. § 3.344 specify that ratings on account of diseases subject to temporary or episodic improvement, such as, psychiatric disorders will not be reduced on any one examination, except in those instance where all the evidence of record clearly warrants the

conclusion that sustained improvement has been demonstrated.

The regulations provide further, that these considerations are required for ratings which have continued for long periods at the same level (five years or more), and that they

do not apply to disabilities which have not become stabilized and are likely to improve.

Reexaminations disclosing improvement, physical or mental, in these disabilities will

warrant a reduction in rating.

The law provides that where a rating reduction was made without observance of law, although a remand for compliance with that law would normally be an adequate remedy, in a rating reduction case the erroneous reduction must be vacated and the prior rating restored. Schafrath, 1 Vet. App. at


Under 38 C.F.R. § 3.344, the RO must find the following:


based on a review of the entire record, the examination forming the basis for the reduction is full and complete, and at least as full and complete as the examination upon which the rating was originally based;

(2) the record clearly reflects a finding of material improvement; and

(3) it is reasonably certain that the material improvement found will be maintained under the ordinary conditions of life. See Kitchens v. Brown, 7 Vet. App. 320 (1995); Brown, 5 Vet. App.

413, 419 (1993).

Generally, when reduction in the evaluation of a service-connected disability is contemplated and the lower evaluation would result in a reduction or discontinuance of compensation payments, a rating proposing the reduction or discontinuance will be prepared setting forth all material facts and reasons.

The beneficiary must be notified at his or her latest address of record of the contemplated action and furnished detailed reasons therefore. The beneficiary must be given 60 days for the presentation of additional evidence to show that compensation payments should be continued at the present level. 38 C.F.R. § 3.105(e) (2008).

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