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M21-1, Part III, Subpart iv, Chapter 6, Section E – Coded Conclusion

Overview


In This Section

This section contains the following topics:
Topic
Topic Name
1
2
3
4
5
6
7
8
9

1.  General Information on the Coded Conclusion


Introduction

This topic contains general information on the coded conclusion, including

Change Date

December 19, 2014

III.iv.6.E.1.a.  Definition:  Coded Conclusion

coded conclusion is the section of the Codesheet of a rating decision which contains
  • a summary of information on the status of benefits, and
  • all decided issues.
Reference:  For more information on generating a coded conclusion in Veterans Benefits Management System – Rating (VBMS – R), see the VBMS-R User Guide.

III.iv.6.E.1.b.  Coding Subsequent Ratings

Subsequent ratings automatically bring forward the coding for all disabilities previously rated whenever coding directly affecting compensation or pension entitlement is added or changed.

III.iv.6.E.1.c.  Decisions Not Requiring a Coded Conclusion

No coded conclusion is required when the sole issue is
  • denial of special monthly compensation, or
  • a finding of not new and material evidence.
There are no codes applicable to the disposition of these issues.

2.  DCs


Introduction

This topic contains information about DCs, including

Change Date

August 28, 2017

III.iv.6.E.2.a.  Using Analogous Codes

Use analogous codes to evaluate disabilities not listed in 38 CFR Part 4, VA Schedule for Rating Disabilities (the rating schedule) based on
  • function(s) affected
  • anatomical location, and
  • symptomatology.
Reference:  For more information on analogous ratings, see 38 CFR 4.20.

III.iv.6.E.2.b. Components of an Analogous Code

An analogous code consists of two diagnostic codes (DCs) separated by a hyphen.  The first DC of an analogous code is a four-digit code as follows:
  • the first two digits refer to the body system involved in the rating, and
  • the second two digits are always 99.
The second DC of an analogous code is composed of a four-digit code that
  • is taken from the rating schedule, and
  • identifies the criteria used to evaluate the claimed disability.
Example:  Use 6599-6516 for postoperative tonsillectomy if the condition is evaluated under the criteria for chronic laryngitis.
Note:  A DC may not end in 99 unless
  • it is the first four digit code in an analogous code, or
  • service connection (SC) for the disability has been denied and it has not been evaluated for pension.
Example:  The image below demonstrates the use of the 99 modifier on a rating decision Codesheet when SC only was considered and denied for a nonspecific arm condition.
Image showing the use of the 99 modifier on a rating decision Codesheet.
Reference:  For more information on listing pension rating codes, see M21-1, Part III, Subpart iv, 6.E.7.

III.iv.6.E.2.c.  Using Hyphenated Codes to Rate Residual Conditions

Hyphenated codes do not necessarily denote analogous ratings.  A hyphenated DC may be used to identify the proper evaluation of a disability or a residual from disease.
The first DC of a hyphenated code identifies the diagnosed disease or condition.  The second DC of a hyphenated code identifies the criteria in the rating schedule used to evaluate the disability.
Example:  Ankylosis of the wrist from rheumatoid arthritis would be rated as 5002-5214.

III.iv.6.E.2.d.  Rating Multiple Disabling Manifestations From the Same Disease

When rating multiple disabling manifestations resulting from the same disease, such as arthritis, multiple sclerosis, or cerebrovascular accident, code each disability separately as follows:
  • show the DC of the disease as the lead DC of the hyphenated codes
  • follow the lead code with a code for the body system of the most severely affected disorder
  • code the involvement of the other body systems under the DC for the disability on which the evaluation is determined, and
  • identify the basic disease entity in the diagnoses of the disabilities involved.
Example:  Multiple disabling manifestations of Parkinson’s disease (DC 8004) would result in the following hyphenated codes:
  • 8004-8520 sciatic nerve condition due to Parkinson’s disease as the most severely affected residual, followed by less disabling residuals of
  • 8515 median nerve condition due to Parkinson’s disease
  • 9434 major depressive disorder due to Parkinson’s disease, and
  • 7203 esophageal stricture due to Parkinson’s disease.
Reference:  For more information on rating multiple disabling manifestations from the same disease, see the VBMS-R User Guide.

3.  Evaluations and Effective Dates


Introduction

This topic contains information about evaluations and effective dates, including

Change Date

August 23, 2018

III.iv.6.E.3.a.  Required Evaluations and Effective Dates for SC Disabilities

The coded conclusion on the Codesheet must contain the following information for all service-connected (SC) disabilities, both individually and as combined totals:
  • current percentage evaluation
  • current effective date
  • future percentage evaluation, if applicable, and
  • future effective date, if applicable.
Important:  The rating activity should carefully review the coded conclusion and backfill all historical disability information in the master record as necessary.
Note:  An effective date of pension entitlement is required only next to rating code 2.
Reference:  For more information on backfilling the master record, see the VBMS-R User Guide.

III.iv.6.E.3.b.  Evaluations and Effective Dates for NSC Disabilities

Effective dates are not required for non-service-connected (NSC) disabilities.
Use the table below to determine when evaluations for NSC disabilities are required.
If rating a claim for … Then evaluations for NSC disabilities …
compensation only
are not required.
Exception:  If the claimant is currently in receipt of pension, but claiming – and being disallowed – entitlement to compensation, then evaluations for NSC disabilities are required.
pension only are required.
compensation and pension are required.

III.iv.6.E.3.c.  Recording Evaluations

For each SC disability, record
  • the evaluation in effect
  • the new evaluation assigned, if indicated, and
  • future evaluation(s), if indicated.
Note:  Show only one line of entitlement after the SC condition whenever there is a retroactive increase or reduction.
Example:  A Veteran has been entitled to 30 percent from 01/01/1993 and 50 percent from 01/01/1994. A retroactive increase of 70 percent from 01/01/1994 has been awarded.  The coded conclusion should only show the 30-percent evaluation from 01/01/1993 and the 70-percent evaluation from 01/01/1994.

III.iv.6.E.3.d.  Showing Evaluations in Ratings That Apply 38 CFR 3.105(e)

When applying the provisions of 38 CFR 3.105(e) in a final reduction rating, the coded conclusion should show the
  • current evaluation in effect, and
  • future reduced evaluation.

4.  Combined Evaluations


Introduction

This topic contains information about combined evaluations, including

Change Date

August 23, 2018

III.iv.6.E.4.a. Combined Evaluations Contained on the Coded Conclusion

The coded conclusion contains the
  • current combined evaluation
  • historical combined evaluation(s), and
  • the effective date(s) for each combined evaluation.
The COMBINED EVALUATION FOR COMPENSATION field is populated whenever there is at least one SC or 38 U.S.C. 1151-awarded disability.
The COMBINED EVALUATION FOR PENSION field is populated with the combined evaluations of both the NSC and SC disabilities whenever a claim for pension has been decided.
Exception:  Proposed evaluations, such as under the Integrated Disability Evaluation System program or proposed reductions, are not reflected in the combined evaluation.
Note:  VBMS-R automatically calculates each combined evaluation effective date based on the issues established and effective dates entered.

III.iv.6.E.4.b. Applying the Bilateral Factor

38 CFR 4.26 provides for a bilateral factor whenever there are compensable disabilities affecting the use of
  • both arms
  • both legs, or
  • paired skeletal muscles.
The ratings for the disabilities of the right and left sides will be combined as usual, and 10 percent of this value will be added (i.e., not combined) before proceeding with further combinations of non-bilateral disabilities, or converting to degree of disability.  This is known as the bilateral factor.
Important:
  • The bilateral factor only applies when there are qualifying disabilities of the left and right sides.
  • When a specific DC provides one evaluation for a bilateral condition, only apply the bilateral factor if there is an independently ratable condition in one of the involved extremities such as in the case of a 20-percent evaluation for left leg muscle damage under DC 5311 in addition to 30-percent evaluation for bilateral flat feet under DC 5276.
Reference:  For more information on when the bilateral factor may not be applied to skin conditions, see M21-1, Part III, Subpart iv, 4.L.1.g.

III.iv.6.E.4.c.  Rounding Combined Evaluations

Rounding combined evaluations is the last step in determining the combined degree of disability under 38 CFR 4.25, and is to be done only once per rating.
Use the table below to determine how to round actual combined evaluations.
If an actual combined evaluation ends in a …
Then round …
fraction from 0.1 to 0.4
down to the nearest whole degree.
fraction from 0.5 to 0.9
up to the nearest whole degree.
whole number from 1 to 4
down to the nearest number divisible by 10.
whole number from 5 to 9
up to the nearest number divisible by 10.

5.  Benefit Withholdings


Introduction


Change Date

 August 23, 2018

III.iv.6.E.5.a.  General Information on VBMS-R’s Withholding Functionality

VBMS-R includes functionality that facilitates offsets to Department of Veterans Affairs (VA) benefit awards when beneficiaries have received certain concurrent payments
  • of disability severance pay
  • under the Radiation Exposure Compensation Act (RECA)
  • in connection with tort awards, or
  • of Office of Workers’ Compensation Programs (OWCP) benefits.
When review of the evidentiary record reveals that a beneficiary received one of the above-referenced payment types for an SC disability, use the WITHHOLDING INFORMATION field in VBMS-R’s DISABILITY DECISION INFORMATION (DDI) screens in order to identify the
  • type of concurrent payment for which VA benefit withholding is necessary and,
  • if applicable, the percentage of VA benefit withholding needed.
Exception:  Do not enter the withholding information attributes described in this block if a Veteran received disability severance pay for one or more SC disabilities incurred in a combat zone or during the performance of duty in combat-related operations, as discussed in M21-1, Part III, Subpart v, 4.B.3.e and f.  Instead, identify such disability(ies) by following the procedures in M21-1, Part III, Subpart iv, 6.E.5.b.
References:  For more information on

III.iv.6.E.5.b. Identifying Disabilities for Which Combat-Related Disability Severance Pay Was Awarded

When awarding SC for disabilities that were incurred in a combat zone, or during the performance of duty in combat-related operations, and resulted in an award of disability severance pay, as discussed in M21-1, Part III, Subpart v, 4.B.3.e and f, identify each such disability by selecting Enhanced Disability Severance Pay from the SPECIAL ISSUE INFORMATION drop-down menu in VBMS-R.

III.iv.6.E.5.c. Identifying Periods of Service for Which Separation Benefits Were Awarded

As is discussed in M21-1, Part III, Subpart v, 4.B.2.i, identification of the period(s) of service during which SC disabilities had their onset can often materially influence award actions to recoup separation benefits (other than disability severance pay) awarded by the Department of Defense at the time of discharge.
  • Compensation payable for SC disabilities incurred during any period of service that preceded the discharge for which separation benefits were paid is subject to recoupment.
  • Compensation payable for SC disabilities incurred during a period of service that followed the discharge for which separation benefits were paid is not subject to recoupment.
When awarding SC to a Veteran who received a separation benefit other thandisability severance pay, follow the steps in the table below to properly identify the periods of service during which all SC disabilities were incurred, as necessary.
Step
Action
1
Has the Veteran performed multiple periods of service?
  • If yes, proceed to the next step.
  • If no, disregard the remaining steps in this table.  No form of annotation or service-period differentiation is required, as all payable compensation is subject to the recoupment of separation benefits.
2
Did the Veteran incur one or more SC disabilities during a period of service that followed the discharge for which separation benefits were paid?
  • If yes, proceed to the next step.
  • If no,
    • use the SPECIAL NOTATION field on VBMS-R’s PROFILE screen to include a Codesheet annotation that reads, All SC disabilities subject to recoupment, and
    • disregard the remaining steps in this table.
3
Use the SPECIAL NOTATION field on VBMS-R’s PROFILE screen to include a Codesheet annotation that identifies
  • each SC disability, and
  • the period of service during which it was incurred.
Notes:
  • Examples of the above-referenced Codesheet annotations are shown in M21-1, Part III, Subpart iv, 6.E.5.d.
  • If all SC disabilities were incurred during one single period of service, a summary annotation to that effect (e.g. All SC disabilities incurred during period of service spanning 06/11/2007-08/25/2011) is sufficient.
Exception:  If the authorization activity is able to confirm that separation benefits have already been recouped in full, inclusion of the annotations and service-period differentiation discussed in this block is not required.
References:  For more information on

III.iv.6.E.5.d. Examples:  Separation Benefit Codesheet Annotations

Scenario 1:  A Veteran served from February 13, 1985, to September 26, 1991, and again from October 28, 1992, to December 4, 1996.  He received separation benefits at the end of the first period of service.  SC is established for right shoulder impingement syndrome, left hip bursitis, bronchial asthma, gastric ulcer, and bilateral testicular atrophy.  Analysis of service treatment records (STRs) shows that the shoulder, hip, and gastric ulcer were incurred during the first period of service.  The testicular atrophy and asthma had their onset during the second period of service.
Outcome:  A sufficient Codesheet annotation is shown below.
     -Right shoulder impingement syndrome, left hip bursitis, and gastric ulcer
were incurred during period of service spanning 02/13/85-09/26/91.
     -Testicular atrophy and bronchial asthma were incurred during period of
service spanning 10/28/92 – 12/04/96.
Scenario 2:  A Veteran served from March 18, 2001, to November 9, 2009, and again from May 30, 2011, to April 18, 2016.  She received separation benefits at the end of the second period of service.  SC is established for status-post total abdominal hysterectomy, scarring alopecia, and bilateral plantar fasciitis.  Analysis of STRs shows that the hysterectomy was performed during the first period of service, while the alopecia and plantar fasciitis manifested during the second.
Outcome:  A sufficient Codesheet annotation is shown below.
     –All SC disabilities subject to recoupment.
Scenario 3:  A Veteran served from September 22, 2003, to December 15, 2007; from April 17, 2009, to September 18, 2014; and from January 7, 2016, to May 2, 2018.  He received separation benefits at the end of the second period of service.  SC is established for migraine headaches, thoracolumbar strain, and temporomandibular joint dysfunction (TMD).  Analysis of STRs shows that the thoracolumbar strain and TMD were incurred during the first period of service, while the migraine headaches manifested during the third.
Outcome:  A sufficient Codesheet annotation is shown below.
     -Back strain and TMD were incurred during the period of service
spanning 9/22/03 – 12/15/07.
     -Headaches were incurred during the period of service spanning 1/7/16 –
5/2/18.

6.  Other Coding Issues


Introduction

This topic contains information about other coding issues, including

Change Date

August 23, 2018

III.iv.6.E.6.a.  Denying IU

When the issue of entitlement to individual unemployability (IU) is denied for the first time, a formal, coded rating is required.

III.iv.6.E.6.b.  Denying SMP

A summary of past coding pertaining to compensation or pension entitlement is not required when there is no entitlement to special monthly pension (SMP), unless the decision has changed.
Include the denial of SMP in any future ratings that bring forward compensation or pension coding.

III.iv.6.E.6.c.  Coding Competency

The coded conclusion should show all determinations of incompetency and restored competency.  Include competency determinations in any future ratings that bring forward compensation or pension coding.
If a previously incompetent Veteran has regained competency
  • prepare a rating to show
    • that the Veteran is competent, and
    • the effective date of the determination, and
  • furnish a copy of the rating to the fiduciary activity.
Important:  Do not furnish a copy of the rating to the fiduciary activity in the case of a VA institutionalized Veteran without a spouse, child, or fiduciary if VA Form 21-592Request for Appointment of a Fiduciary, Custodian, or Guardian, was not furnished earlier under the provisions of M21-1, Part III, Subpart v, 6.E.2.
Reference:  For more information on the process for making competency determinations, see M21-1, Part III, Subpart iv, 8.A.3.

III.iv.6.E.6.d. Removing Active Duty Discontinuance Coding

As is discussed in M21-1, Part III, Subpart v, 4.C.7.c, preparation of a rating decision that reflects loss of entitlement to benefits based on a Veteran’s return to active duty is not necessary.
Similarly, as discussed in M21-1, Part III, Subpart v, 4.C.7.g, rating action to reinstate benefits following a Veteran’s release from active duty is not necessaryunless the Veteran’s award was originally discontinued by rating decision.
When deciding the claim of a Veteran whose prior Codesheet(s) reflect the loss of SC during a period of active duty, use the MASTER RECORD tab and/or DDI screens to remove all previous Active Duty – Discontinue selections and corresponding discontinuance dates from all affected SC disabilities.  The authorization activity will recreate all necessary adjustments by award action.

7.  Listing Compensation Rating Codes


Introduction

This topic contains information about listing compensation rating codes, including

Change Date

August 23, 2018

III.iv.6.E.7.a.  Grouping SC Disabilities

Group all disabilities subject to compensation under code 1, showing the
  • disabilities by current evaluation in descending order, and
  • DC followed by the diagnosis.
Note:  In VBMS-R, disabilities are grouped automatically and carried forward from rating to rating.

III.iv.6.E.7.b.  Using Diagnostic Terminology

Use the diagnostic terminology provided by the medical examiner (or other alternative medical evidence) in the rating decision.
Notes:
  • Do not attempt to translate the examiner’s terms into schedular terminology unless citation is required by way of explanation, such as when rating by analogy.
  • Do not cite a lengthy diagnosis in full.  Instead, retain its essential elements in the decision.
  • Do not cite residuals of diseases or therapeutic procedures without reference to the underlying disease.
  • Do not include unnecessary descriptive words in the diagnosis.  For example, state the diagnosis as hypertension, and not severe hypertension.
  • Do not follow the diagnosis with parenthetical annotations that include the terminology used by the claimant to describe his/her condition on his/her application (e.g. tinnitus (claimed as ringing in the ears)) on theCodesheet.  Instead, as instructed in M21-1, Part III, Subpart iv, 6.C.3.d, limit use of such annotations to the rating decision Narrative alone.

III.iv.6.E.7.c.  Coding Compensation Awards

When first establishing SC for a particular disability, include the following under each diagnosis:

  • percentage evaluation
  • effective date
  • period of service, and
  • appropriate basis for each award
    • INCURRED
    • AGGRAVATED
    • PRESUMPTIVE
    • SECONDARY
    • 38 CFR 3.383 (PAIRED EXTREMITY), or
    • AGGRAVATED NSC.
Note:  Some decision basis selections will require additional information.  For example, if the selected decision basis is SECONDARY, an associated disability must be selected from the ASSOCIATED DISABILITY drop-down menu.
Reference:  For more information on coding compensation awards, see theVBMS-R User Guide.

III.iv.6.E.7.d.  Coding New Awards of Previously-Considered Issues

Use the table below when awarding SC for an issue that was previously
  • denied SC, or
  • rated in order to support entitlement to another non-compensation benefit, such as
    • pension
    • vocational rehabilitation, or
    • SC for treatment purposes under 38 U.S.C. 1702.
If the newly-awarded disability was previously …
Then add the issue to the Service Connectedsection of the Codesheet, and …
denied SC
remove its associated entry from the Not Service Connected/Not Subject to Compensation section of the Codesheet.
rated in order to support entitlement to another non-compensation benefit
  • remove its associated entry from the other respective section of the Codesheet, or
  • if possible, edit the existing Codesheetentry to include a closure date that is equivalent to the effective date of the new award of SC.
Reference:  For more information on editing and deleting existing disability decisions, see the VBMS-R User Guide.

8.  Listing Pension Rating Codes


Change Date

December 13, 2005

III.iv.6.E.8.a. Handling Disabilities That Result From Willful Misconduct

Code all claimed and noted disabilities, and show the evaluation of each disability, as appropriate, unless the disabilities have been held to be due to the claimant’s own willful misconduct by rating or by an administrative decision.
When intoxication from alcohol or drugs results proximately and immediately in disability or death, it is due to willful misconduct.  However, organic diseases which are caused by the chronic use of alcohol are not considered of willful misconduct origin under 38 CFR 3.301(c)(2), and should be provided an evaluation if pension is claimed.
Example:  Cirrhosis of the liver due to chronic alcohol abuse may form the basis for an award of NSC pension.
Note:  Disabilities that result from the use of alcohol or drugs may not be SC because they cannot be deemed to have been incurred in the line of duty.
References:  For more information on

9.  Coding Denials of NSC Conditions


Introduction

This topic contains information about coding denials of NSC conditions, including


Change Date

December 16, 2016

III.iv.6.E.9.a.  Showing Reasons for Denial of NSC Conditions

When a claim is initially disposed of, the reasons for denial are shown after the diagnosis on the rating Codesheet.  For example
  • not incurred/caused by service
  • constitutional/developmental abnormality
  • willful misconduct, injury, or
  • not in line of duty.
These denial reasons will remain on the Codesheet for subsequent ratings unless
  • a new reason for denial is required, or
  • SC is awarded.
Note:  VBMS-R automatically performs these functions if all the issues are correctly entered into the program.

III.iv.6.E.9.b.  Reflecting the Date of Original Denial

If a disability was previously denied SC, VBMS-R will reflect the date of the prior decision in the ORIGINAL DATE OF DENIAL field in all subsequent rating decisions.  This date is listed in the coded conclusion after the diagnosis on the rating Codesheet.
Note:  This date is not populated on the Codesheet if the current decision is the initial denial.
When deciding a claim for a previously denied disability, decision makers must ensure the correct date of the initial denial of the claim is reflected in the ORIGINAL DATE OF DENIAL field.  Follow the steps in the table below to update the ORIGINAL DATE OF DENIAL field in VBMS-R.
Step
Action
1
Navigate to the MASTER RECORD tab.
2
  • On the DISABILITY DECISIONS tab, locate the relevant disability, and
  • select VIEW/EDIT.
3
  • Navigate to the DIAGNOSIS INFORMATION tab, and
  • select EDIT.
4
  • Locate the ORIGINAL DATE OF DENIAL field
  • enter the appropriate date, and
  • select SAVE CHANGES.
Reference:  For more information on backfilling the master record, see
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