| Veterans Disability Benefits
Legislation was passed in Late 2006 allows veterans to hire an attorney or “agent” for representation in benefits claims before the Veterans Administration (VA). The Veterans Benefits, Health Care, and Information Technology Act of 2006, Pub. L. No. 109-461, § 101. The new law allows veterans to hire an attorney (or agent) after the VA “Notice of Disagreement” (similar to requesting reconsideration in SSA claims) is filed after an initial denial. The new provision for fees will apply to services provided in cases where the VA Notice of Disagreement is filed on or after June 20, 2007, which is 180 days after the date of enactment, December 22, 2006.
What are the qualifications of Attorney Agents?
Under the new law, the VA is authorized to set qualifications and standards of conduct for attorneys and agents. Also the VA will set “reasonable” restrictions on the amount of fees that can be charged.
How much will my fees be?
The law provides that a fee will be presumed to be “reasonable” if it does not exceed 20% of past due benefits. If the fee is withheld from past due benefits and directly paid to the representative, the VA may assess a “user fee” equal to 5% of the attorneys fee. The “user fee” is capped at $100. The VA has issued proposed regulations to implement the law. 72 Fed. Reg. 25930 (May 7, 2007).
What are the key provisions of the law?
Key provisions include:
Accreditation
* Only accredited attorneys and “agents” are allowed to receive fees from claimants.
* Accreditation is a two-step process:
First, there is a “character and fitness” determination. Information about any court or agency where the person seeking accreditation is admitted to practice must be submitted. This includes certification that an attorney is in good standing in every jurisdiction where admitted to practice. As required by law, this information must be provided annually.
* Second, the individual must take a written examination with a score of 75 or above. Examinations will be administered at the office of a VA Regional Counsel or the VA Central Office.
* To request accreditation, an application is filed with the VA. If denied, it can be appealed.
* Standards of conduct are established, as required by the law. Attorneys also must conform to the higher standards of conduct for the state(s) where they are admitted to practice.
Under what legal provision am I entitled to help to obtain my VA benefits?
The Veterans Claims Assistance Act of 2000 (commonly referred to as the “VCAA”) was passed to help disabled military veterans work their way through the complicated process of applying for Veterans Disability benefits. Under previous law, the Department of Veterans Affairs (“VA”) often did little to aid veterans in understanding the claim process or obtaining the evidence that is necessary to prove a disability claim. The VCAA provided Congressional recognition to the principle that the VA is supposed to be “claimant friendly” in the context of its “non-adversarial system” by providing a “substantial amount of assistance” to veteran claimants. 146 CONG. REC. At H9913 (Oct. 17, 2000). However, even after the passage of the VCAA, it was common for the VA to give nothing more than vague guidance, if any, to disabled veterans seeking benefits. Recently, the Court of Appeals for the Federal Circuit breathed new life into the VCAA’s requirements when it decided Sanders v. Nicholson, 487 F.3d 881 (Fed. Cir. 2007).
What was Sanders v. Nicholson, 457 F.3d 881 (Fed. Cir. 2007)
Prior to the enactment of the VCAA, the VA only had to assist in the full development of a veteran’s claim if the veteran could provide enough information to the VA to prove his or her claim was “well-grounded” or plausible. The VCAA eventually eliminated the well-grounded claim requirement in 38 U.S.C. §5103 (see also 146 Cong. Rec. H. 9912, H9917). It also created a duty to assist all claimant’s when a claim for benefits is filed, Id. This includes the VA notifying claimants how to substantiate their claim, Id. According to the VCAA, if a claim is denied, the VA must provide the claimant with a statement of the evidence considered and reasons for its decision, 38 U.S.C. § 5104(b). If the claimant disagrees, he/she then files a Notice of Disagreement (the first appeal in the VA claim system), the VA also must provide the claimant with reasons for the denial, the evidence considered, and relevant statutes and regulations relied upon 38 U.S.C. §7105(d)(1). The claimant may also appear and present evidence before the Board of Veterans Appeals. The VA personnel conducting the hearing must “suggest the submission” of exculpatory evident, 38 C.F.R. §3.103©)(2).
Why is Sanders vs. Nicholson important to me?
In Sanders v. Nicholson, the Circuit Court of Appeals for the Federal Circuit considered an appeal from the U.S. Court of Appeals for Veterans Claims and explained that the notice requirement set forth in the VCAA can be divided into four separate elements:
1. Notice of what information or evidence is necessary to substantiate the claim;
2. Notice of what subset of the necessary information or evidence, if any, that the claimant is to provide;
3. Notice of what subset of the necessary information or evidence, if any, that the VA will attempt to obtain; and
4. A general notification that the claimant may submit any other evidence he or she has in his or her possession that may be relevant to the claim.
487 F.3d at 887. The significance of the Sanders decision lies in its recognition of these discreet notice requirements, and its shift in the burden of proof from the veteran to the VA in demonstrating that the failure to comply with the VCAA notice requirements did not affect the essential fairness of the process requiring reversal.
Before Sanders, a veteran was generally required to prove that the he or she “would have provided or requested the Secretary (of the VA) to obtain “specific evidence if proper notice had been given by the VA, Id.; see also Sanders v. Nicholson, 20 Vet. 143 (2006) and Mayfield v. Nicholson, 19 Vet. App. 103 (2005). The veteran had the burden to show “how the lack of notice and evidence affected the essential fairness” of the claim, id. For example, the veteran may have asked the VA to obtain medical records from a particular doctor or direct the VA to obtain service records demonstrating that the veteran was injured while on duty if the VA explained what type of records could support a claim.
Sanders overruled earlier U.S. Court of Appeals for Veterans Claims’ decisions, which required the veteran to bear the burden of providing prejudice when proper notice was not given. Sanders, 487 F.3d at 889. The Federal Circuit held that after the claimant proves a violation of any of the four notice requirements, the burden shifts to the Secretary to prove defective notice was not prejudicial, Id. The court held that a violation of the notice requirement was inherently prejudicial, and a violation creates a rebuttable presumption of prejudice, Id. To prove the defective notice was not prejudicial and avoid a reversal and remand, the court held that the VA must persuade the reviewing court that the purpose of the notice was not frustrated e.g., by demonstrating (1) that any defect was cured by actual knowledge on the part of the claimant, (2) that a reasonable person could be expected to understand from the notice what was needed, or (3) that a benefit could not have been awarded as a matter of law, Id.
Sanders has caused a sea of change in veterans law by imposing a presumption of prejudice when the VA fails to act as directed by the VCAA. As a practical matter, it is hoped that compliance with the VCAA will force the VA to help veterans develop better claim files. Because veterans are prohibited by law from hiring and paying attorneys at the initial stage of their claim, it is common for the “record” found in claim files to be incomplete and insufficient on appeal. By placing this burden on the VA, it is hoped that more veterans’ claims will be properly developed.
What is the Benefit of Sanders?
Should a veteran have to file a Notice of Disagreement after a claim is denied by the VA, practitioners will benefit from the more fully developed record that hopefully will result from requiring the VA to fulfill the intent of the VCAA. It should also reduce the need to develop as much evidence while the appeal is pending before the Board of Veterans Appeals. Finally, in Sanders, the Court of Appeals for the Federal Circuit provided a roadmap to presenting improper notice under 38 U.S.C. §5103 and 38 C.F.R. §3.159 as an issue on appeal before the U.S. Court of Appeals for Veterans Claims.
Why does my appeal take so long?
View PDF Flow Chart here.
Fees
Fees may be received only for services provided after the claimant files a Notice of Disagreement to the VA’s initial decision.
* Fees must be “reasonable”. They can be based on a fixed fee, hourly rate, percentage of benefits recovered, or combination. A list of factors can also be used in determining the reasonableness of the attorney’s ultimate hourly rate if it is not otherwise agreed to us writing by the veterans.
* Fees are presumed reasonable if not more than 20% of past due benefits. The presumption can be rebutted by applying the “reasonableness” factors.
* Fee agreements must be signed by the claimant and attorney/agent and filed wit the VA Office of General Counsel within 30 days of signing. If it includes direct payment from the claimant’s past due benefits, it also must be filed with the VA office that is handling the original claim.
* A fee agreement that provides for fees exceeding 20% of past due benefits is not considered a “direct-pay” fee agreement and the attorney/agent would be responsible for collecting fees from the client.
* The VA can collect a “user fee” equal to 5% of the fee amount, but capped at $100
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