Authorization Under the Nehmer Stipulation

Overview

In This Section

This section contains the topic, “ Authorization Under the Nehmer Stipulation.”

1. Authorization Under the Nehmer Stipulation

Introduction

This topic contains information on authorization actions under the Nehmer stipulation, including

• determining the proper survivor of a Nehmer class member for payment purposes
• identifying the appropriate survivor of a Nehmer class member
• actions to take when the appropriate survivor of a Nehmer class member cannot be located
• requirement to document efforts taken to identify a potential payee
• identifying other survivors of a Nehmer class member before awarding benefits to an identified payee
• considering entitlement to additional allowances for a surviving spouse
• awards to Nehmer class members who receive(d) military retired pay (MRP)
• payment of Dependency and Indemnity Compensation (DIC) to the surviving spouse of a Veteran who died prior to January 1, 1993
• authorization activity responsibility to determine the effective date of an award of DIC
• awards of retroactive benefits of $10,000 or more to incompetent beneficiaries
• applying a retroactive payment under the Nehmer court order to a debt
• annotating an award of retroactive benefits under the Nehmer court order, and
• second signature requirement for award actions taken under the Nehmer court order.

Change Date

May 25, 2023

VIII.i.2.C.1.a. Determining the Proper Survivor of a Nehmer Class Member for Payment Purposes

If a Nehmer class member entitled to retroactive benefits under 38 CFR 3.816(c) and (d) dies before receiving the payment of retroactive benefits, the Department of Veterans Affairs (VA) will, consistent with 38 CFR 3.816(f), award the unpaid benefits to the first individual or entity in existence at the time of payment in the following order:

• spouse at the time of death, regardless of current marital status
• child or children, divided into equal shares if more than one child exists, regardless of age or marital status
• parents, with half of the retroactive benefits owed paid to each parent, regardless of dependency status, or
• the class member’s estate.

Note: The survivor or estate of a Nehmer class member is not required to file an application in order to receive unpaid benefits.

Important: Under the Nehmer claims process, if a Veteran dies while the claim is pending, the surviving spouse is automatically substituted as the claimant or payee by virtue of being a “class member” entitled to retroactive compensation.

Reference: For more information on determining eligibility to retroactive payment under the Nehmer stipulation, see M21-1, Part VIII, Subpart i, 2.B.

VIII.i.2.C.1.b. Identifying the Appropriate Survivor of a Nehmer Class Member

Review the entire claims folder to determine eligible survivor payees. Some sources of this information include, but are not limited to,

• benefit applications
• statements from the Veteran
• Compensation and Pension Record Interchange records
• Share inquiries and corporate database review
• claims-processing system notes
• Participant Profile
• CLEAR reports, and
• contact with, if known or applicable,
• authorized representatives of record
• individuals who provided first notice of death, and
• funeral homes that provided funeral/burial services.

VIII.i.2.C.1.c. Actions to Take When the Appropriate Survivor of a Nehmer Class Member Cannot Be Located

Use the table below to determine the actions to take when the appropriate survivor of a deceased Nehmer class member cannot be located.

Scroll sideways to see the full table.

VIII.i.2.C.1.d. Requirement to Document Efforts Taken to Identify a Potential Payee

Document all efforts taken to identify a potential payee on VA Form 27-0820, Report of General Information, for inclusion in the claims folder.

• On the VA Form 27-0820, summarize the actions taken to identify a potential payee.
• If retroactive benefits are not payable to the potential payee, describe on the form the reason(s) why.

Important:

• Prepare a separate VA Form 27-0820 for each potential payee with whom contact is attempted or made.
• Claims processors must take the actions described in this block, as the Nehmer court order mandates that VA notify class counsel for National Veterans Legal Services Program if VA is unable to identify a payee.

VIII.i.2.C.1.e. Identifying Other Survivors of a Nehmer Class Member Before Awarding Benefits to an Identified Payee

Before awarding benefits to an identified payee, ask the payee to state whether or not there are any other survivors of the Nehmer class member who may have an equal or greater entitlement to unpaid benefits.

If it appears other survivors exist that may be eligible for unpaid benefits, send letters to all dependents of record, requesting their

• names
• addresses, and
• telephone numbers.

Notes:

• If potential entitlement to burial benefits and/or Dependency Indemnity Compensation (DIC) exists, invite a claim by sending a survivor the proper prescribed claim form(s) identified in M21-1, Part II, Subpart iii, 1.A.1.a.
• As noted in M21-1, Part XII, Subpart i, 4.B.1.h, a service-connected (SC) burial allowance may be awarded to a surviving spouse without a claim when DIC is otherwise granted.

Important:

• A rating decision must be completed even in cases where no payee has been identified.
• Proof of a familial relationship to the Nehmer class member must be of record before VA may pay retroactive benefits to a survivor. Undertake development to obtain birth certificates, marriage certificates, or other documentary proof of a familial relationship, as applicable.

VIII.i.2.C.1.f. Considering Entitlement to Additional Allowances for a Surviving Spouse

When preparing an award of unpaid benefits to the surviving spouse of a deceased Nehmer class member, consider any additional allowances to which the surviving spouse may be entitled, including, but not limited to, an additional allowance

• for dependents
• because the class member was totally disabled due to SC disabilities for a continuous period of at least eight years prior to death, and the surviving spouse was married to the class member during the same time period, and/or
• because the surviving spouse requires the aid and attendance of another person.

VIII.i.2.C.1.g. Awards to Nehmer Class Members Who Receive(d) MRP

Use the table below when taking award action under Nehmer on a Veteran who received military retired pay (MRP).

Scroll sideways to see the full table.

VIII.i.2.C.1.h. Payment of DIC to the Surviving Spouse of a Veteran Who Died Prior to January 1, 1993

If a Veteran died prior to January 1, 1993, VA pays DIC to the surviving spouse based on whichever of the following provisions provides the greatest benefit:

• 38 U.S.C. 1311(a)(3), which is based on the Veteran’s pay grade, or
• 38 U.S.C. 1311(a)(1) and 38 U.S.C. 1311(a)(2), which is based on
• the basic rate of DIC, and
• any additional allowance payable due to the Veteran being
• rated as totally disabled for at least eight continuous years prior to death, and
• married to the surviving spouse for the same period of time.

Important:

• Grant entitlement to DIC when a disability for which VA granted service connection (SC) on a presumptive basis was the primary, secondary, or a contributory cause of death.
• The pay grade of Veterans that died prior to January 1, 1993, must be verified with service documents.
• Verification of a Veteran’s pay grade is not required when awarding DIC
• to children or parents, or
• if the Veteran died on or after January 1, 1993.

VIII.i.2.C.1.i. Authorization Activity Responsibility to Determine the Effective Date of an Award of DIC

The authorization activity has sole jurisdiction in determining the effective date for DIC awards.

If VA receives a claim for DIC within one year of the Veteran’s death, the proper effective date for the corresponding award is the first day of the month of the Veteran’s death. Otherwise, the proper effective date is the first of the month following the date VA received the claim.

Exception: Per 38 CFR 3.816(d)(2), if a survivor’s claim for DIC was either pending before VA on May 3, 1989, or was received by VA between that date and the effective date of the statute or regulation that established a presumption of SC for the covered herbicide disease that caused death, the effective date of entitlement is the later of the following dates:

• the date VA received the claim (making the first of the month following the date VA received the claim the effective date of the corresponding award, after the application of 38 CFR 3.31), or
• the date of the Veteran’s death (making the first day of the month of the Veteran’s death the effective date of the corresponding award, according to 38 CFR 3.816(d)(3)).

VIII.i.2.C.1.j. Awards of Retroactive Benefits of $10,000 or More to Incompetent Beneficiaries

Carefully follow the procedures found in M21-1, Part X, Subpart ii, 6.E.1.f-j, upon identification of an award of retroactive benefits under the Nehmer court order that

• is payable to an incompetent beneficiary (through a fiduciary or supervised direct pay), and
• will equal or exceed $10,000.

VIII.i.2.C.1.k. Applying a Retroactive Payment Under the Nehmer Court Order to a Debt

Prior to releasing a retroactive payment under the Nehmer court order, use the table below to determine whether it is appropriate to apply the payment to a debt.

Scroll sideways to see the full table.

VIII.i.2.C.1.l. Annotating an Award of Retroactive Benefits Under the Nehmer Court Order

After generating an award of retroactive benefits under the Nehmer court order, claims processors must enter Nehmer retroactive payment based in the

• Remarks section of the award print (in the Veterans Service Network), or
• PRINT REMARKS dialog box (in the Veterans Benefits Management System - Awards).

VIII.i.2.C.1.m. Second Signature Requirement for Award Actions Taken Under the Nehmer Court Order

All award actions taken and notices of decision prepared under the Nehmer court order require review by and the second signature of an authorizing subject matter expert prior to finalization.