IN THE CASE OF:	  

		BOARD DATE:	  23 April 2015

		DOCKET NUMBER:  AR20140012517 


THE BOARD CONSIDERED THE FOLLOWING EVIDENCE:

1.  Application for correction of military records (with supporting documents provided, if any).

2.  Military Personnel Records and advisory opinions (if any).


THE APPLICANT'S REQUEST, STATEMENT, AND EVIDENCE:

1.  The applicant requests disenrollment from the Survivor Benefit Plan (SBP) and reimbursement for all premiums paid to date.

2.  The applicant states that he was not afforded the opportunity to complete a DA Form 2656 (Data for Payment of Retired Pay) because of the Army’s neglect in completing his Physical Evaluation Board (PEB).  He also states that the Air Force completed his PEB and medical discharge and he does not want this deduction or to participate in the SBP.  

3.  The applicant provides copies of his approval by the Department of Defense Physical Disability Board of Review (DoD PDRB) and the back page of his DD Form 2656 dated 29 January 2014.

CONSIDERATION OF EVIDENCE:

1.  The applicant was serving as a United States Army Reserve sergeant first class (E-7) in the Active Guard Reserve program when a PEB convened at Fort Lewis, Washington on 16 July 2004 to consider his diagnosed conditions of neck pain from cervical spondylosis and degenerative disc disease, thoracalumbar back pain with old t-7 compression fracture, and sleep apnea.  The PEB recommended that he be granted a 20% disability rating for cervical spondylosis and degenerative disc disease and 0% for the remaining diagnosis.  The PEB recommended that he be given severance pay and forfeit his non-regular retirement benefits or waive severance pay and elect transfer to the Retired Reserve until age 60.
2.  The applicant agreed with the findings and recommendations of the PEB and waived severance pay for transfer to the Retired Reserve to await his non-regular retired pay.

3.  On 15 August 2004, he was honorably released from active duty.

4.  The applicant appealed his case to the DoD PDRB and that board recommended that his separation be recharacterized as a permanent disability retirement with a combined disability rating of 70% effective the date of his original separation.  The Deputy Assistant Secretary (Army Review Boards) approved the findings and recommendation of the DoD PDRB on 19 October 2011.

5.  On 22 May 2012, the U.S. Army Physical Disability Agency (PDA) provided the applicant a DD Form 2656 and advised him to proceed to the nearest Retirement Services Officer (RSO) for assistance in completing the form.  The PDA also provided a phone number he could call for assistance if needed.

6.  The only DD Form 2656 on file at the DFAS is dated 1 January 2014 and is incorrectly prepared.  Information received from the DFAS indicates that the applicant was enrolled under the automatic coverage provisions of the SBP.  The form does, however, include the service member’s spouse’s notarized signature which is only required when the intent is to decline coverage.

7.  It appears that the applicant was charged back premiums for SBP coverage as he received a bill for SBP due in the amount of $10,718.22.  However, there is no evidence to show that he was counseled or informed that he would incur such a debt as a result of enrollment in the SBP.

8.  SBP is a life insurance program that pays an annuity to eligible beneficiaries upon the death of covered former service members.  As a Federal Government insurance program, mainly subsidized by participant premiums, it is strictly governed by Federal statutes that set forth rules for its operation, including eligibility for enrollment, designation of beneficiaries, and authorized changes to beneficiaries.  Retirees do not earn SBP through their service – they earn the right to participate in SBP.  

9.  Public Law 92-425, enacted 21 September 1972, established the SBP.  The SBP provides that military members on active duty could elect to have their retired pay reduced to provide for an annuity after death to eligible surviving family members.  An election, once made, is irrevocable except in certain circumstances.   Public Law 99-145, enacted 8 November 1985, but effective
1 March 1986, required a spouse’s written concurrence for a retiring member's election that provides less than the maximum spouse coverage.

10.  Title 10, U.S. Code, section 1448 provides, in pertinent part, that effective
1 March 1986, a married member is enrolled in SBP with spouse coverage based on full retired pay at the time of retirement unless that spouse has concurred in writing to another election requested by the member pursuant to Department of Defense Financial Management Regulation, Volume 7B, Chapter 43.  When the spouse's concurrence is required, the signature indicating concurrence must be corroborated by one or more witnesses.  This chapter also states, in pertinent part, that the Secretary of the Military Department concerned (or designee) may correct any election or any change or revocation of an election when the Secretary considers it necessary to correct an administrative error.

11.  Public Law 105-85, enacted 18 November 1997, established the option to terminate SBP participation.  Retirees have a 1-year period, beginning on the second anniversary of the date on which their retired pay started, to withdraw from SBP.  The spouse's concurrence is required.  No premiums will be refunded to those who opt to disenroll.

DISCUSSION AND CONCLUSIONS:

1.  The applicant’s contention that he should be disenrolled from the SBP because he does not want the deduction has been noted and appears to have merit.

2.  The evidence of record shows that the applicant was originally determined to be 20% disabled and was recommended for discharge with severance pay or transfer to the Retired Reserve to await his non-regular retired pay.  In 2004, he elected transfer to the Retired Reserve to await his non-regular retired pay. 

3.  The applicant appealed his case to the DoD PDRB who granted him a 70% disability rating which was approved on 19 October 2011 with an effective date of 15 August 2004.

4.  The applicant was provided the appropriate form and was advised to consult with the nearest RSO for assistance in completing the form or calling the number provided.  However, it appears that he did not comply and although his spouse provided a notarized concurrence the form was otherwise incorrectly prepared.  As a result he was enrolled under the automatic provisions of SBP and his premiums were computed back to 15 August 2004, resulting in an instant debt of $10,718.22 for back premiums.

5.  It appears, based on the available evidence, that the applicant was not afforded proper counseling in regards to his enrollment in the SBP as he was not informed that as a result of his enrollment, he would incur a debt for back premiums for coverage that in essence did not exist.

6.  Therefore, as a matter of equity, the applicant’s records should be corrected to show that he declined to participate in the SBP with his spouse’s concurrence. 

BOARD VOTE:

____X____  ___X_____  ___X_____  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

________  ________  ________  DENY APPLICATION

BOARD DETERMINATION/RECOMMENDATION:

The Board determined that the evidence presented was sufficient to warrant a recommendation for relief.  As a result, the Board recommends that all Department of the Army records of the individual concerned be corrected by showing that the applicant properly elected to decline participation in the SBP and reimbursing all SBP premiums paid.




      _______ _   __X_____   ___
       	   CHAIRPERSON
      
I certify that herein is recorded the true and complete record of the proceedings of the Army Board for Correction of Military Records in this case.



ABCMR Record of Proceedings (cont)                                         AR20140012517





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ABCMR Record of Proceedings (cont)                                         AR20140012517



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