IN THE CASE OF:  	  

		BOARD DATE:  15 October 2015	  

		DOCKET NUMBER:  AR20150003130 


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 the Department of Defense reimburse him 28 years of Survivor Benefit Plan (SBP) premiums. 

2.  The applicant states his wife died on 10 June 2014.  After 28 years (of paying SBP premiums) he was notified that if he died first, she would never receive 
55 percent of his retired pay.  He never participated in the SBP because he was payed as a retiree.  When his wife died, he wrote in reference to the SBP and other issues.  He received a letter from the Mr. JWR, Chief, Army Retirement Services that explained the SBP program to him.  He never received his retired pay since he retired under Title 10, chapter 61, for disability.  A gross injustice occurred here.  He never participated in the SBP since he never received retired pay.  He never gave anybody permission to reduce the compensation he received from the Department of Veterans Affairs (VA).  The SBP is under the Department of the Army.  Had he died instead of his wife, who passed away on 10 June 2014, she would never have received 55 percent of his retired pay since he was never retired and there were no SBP benefits. 

3.  The applicant provides a letter, dated 27 January 2015, from Army Retirement Services. 

CONSIDERATION OF EVIDENCE:

1.  The applicant's records show he was born in April 1925. 

2.  He enlisted in the Regular Army (RA) 5 April 1943 and served in the European Theater of Operations.  He was honorably separated on 1 November 1945. 

3.  He again enlisted in the RA on 11 September 1950.  He served in Korea for 9 months and 12 days from around October 1950 to around June 1951.  He was wounded in action on 24 June 1951.  He sustained shell fragment wounds to the right leg and foot, right flank area, and right forearm. 

4.  He was evacuated through the 12th Evacuation Hospital to Tokyo, Japan, on 26 June 1951 and to Murphy Army Hospital, Waltham, MA, on or about 31 July 1951.  He underwent treatment, evaluations, and therapy.  

5.  He was presented to a medical evaluation board for various diagnosis (wounds, fractures, ankyloses) and declared to have partial permanent disability of right lower extremity.  The board determined that although he was not physically qualified for retention on active duty due to permanent partial disability, it was believed he could render satisfactory service in an assignment with special consideration.  

6.  On 14 April 1953, he requested retention on active duty.  A board met and recommended his retention on active duty with assignment as a unit supply specialist.  He was assigned to the 1124th Headquarters, Boston Army Base. 

7.  He was honorably discharged from active duty on 10 September 1956.  His DD Form 214 shows he completed 6 years of active duty during this period. 

8.  His service records show he received service-connected disability compensation from the VA.  His rate increased over the years.  

9.  His retired pay records at the Defense Finance and Accounting Service (DFAS) show: 

* he is authorized military retired pay (unknown effective date) but he elected to receive a full VA waiver
* his original SBP election was spouse coverage, effective 9 January 1990
* his SBP premiums were suspended due to the death of his spouse in June 2014 

10.  He provided a copy of his spouse's death certificate.  This certificate shows his spouse, Pauline, died on 10 June 2014. 

11.  His July 2014 SBP/RSFPP (Retired Serviceman's Family Protection Plan) Statement shows he receives a monthly statement of his current remittance account that advises him of the current status of his SBP or RSFPP.  It shows a premium payment in the amount of $48.39 was deducted from his VA disability pay. 

12.  On 27 January 2015 he received a letter from Mr. JWR, Chief, Army Retirement Service, in response to his (the applicant's) letter to the President of the United States concerning Concurrent Retired and Disability Pay (CRDP) and the military SBP.  It reads: 

	a.  Congress passed two laws, CRDP and Combat Related Special Compensation (CRSC) to provide compensation to military retirees who have an offset of military retired pay by VA disability compensation.  By law, to receive CRDP, a retiree must qualify for a length of service retirement and have a VA disability rating of 50 percent or higher.  A review of his retired pay records revealed that he has less than the 20 years of service required for a length of service retirement.  Changing the requirements to receive CRDP would require Congress to pass and the President to sign a bill into law.  As of this date, Congress has not passed a bill changing the requirements to receive CRDP. However, he is qualified to receive CRSC and his retired pay files show he currently receives it.  

	b.  When his spouse passed away, his spouse SBP coverage was suspended.  SBP was established by Congress in 1972 to allow military retirees to elect to receive a reduced amount of retired pay in order to provide an annuity for qualified survivors.  SBP is a government subsidized program with the retired Soldier paying a portion of the SBP cost through a monthly premium.  Currently the government subsidizes over 40 percent of the SBP program cost.  The SBP premiums he paid were for SBP coverage received and, by law, there is no refund of SBP premiums when the beneficiary dies before the retiree.

13.  Public Law 92-425, enacted 21 September 1972, established the SBP.  The SBP provided that military members on active duty could elect to have their retired pay reduced to provide for an annuity after death to surviving dependents. An election, once made, was irrevocable except in certain circumstances.  

14.  According to the official DFAS website (dfas.mil), there are other methods of paying for SBP coverage and the member elects the method that is most convenient for them: deductions from retired pay, deductions from VA pay, direct remittance, or paid up status (retirees who reached 70 years of age and have paid 360 monthly payments).

	a.  The normal method of paying for SBP coverage is by an automatic deduction from a retiree’s retirement pay.  However, if a member has been ruled severely disabled by the VA and his/her VA compensation exceeds his/her retired pay, the member does not receive retired pay from DFAS.  As a result, DFAS cannot automatically deduct SBP premiums from the member's monthly pay.  In this case, the best way to pay for SBP coverage is to have payments deducted from the member's VA compensation and forwarded to DFAS Retired and Annuitant Pay by the VA.

	b.  Direct remittance is only for those retired members who do not receive retired pay from DFAS or who do not receive enough retired pay to pay for SBP premiums.  Direct remittance members who choose not to have their SBP payments deducted from their VA pay must remit SBP premium payments directly to DFAS.  Any delinquent amounts carried over into a new billing month will accrue an interest fee calculated at 6 percent Annual Percentage Yield.

15.  Title 10, U.S. Code, section 1450 deals with payment of SBP annuity to beneficiaries.  

	a.  Sub-section 1450(c) (Offset for amount of dependency and indemnity compensation (DIC)) states if, upon the death of a person to whom section 1448 of Title 10 applies, the surviving spouse or former spouse of that person is also entitled to DIC under section 1311(a) of Title 38, the surviving spouse or former spouse may be paid an annuity under this section, but only in the amount that the annuity otherwise payable under this section would exceed that compensation.  A reduction in an annuity under this section required by paragraph (1) shall be effective on the date of the commencement of the period of payment of such DIC under Title 38. 

	b.  Sub-section 1450(e) (Refund of Amounts Deducted From Retired Pay When DIC Offset as Applicable) states in 1450(e)(1) (Full refund:  When DIC is greater than SBP annuity) if an annuity under this section is not payable because of subsection (c), any amount deducted from the retired pay of the deceased under section 1452 of this title shall be refunded to the surviving spouse or former spouse, and in 1450(e)(2) (Partial refund when SBP annuity reduced by DIC) if, because of subsection (c), the annuity payable is less than the amount established under section 1451 of this title, the annuity payable shall be recalculated under that section.  The amount of the reduction in the retired pay required to provide that recalculated annuity shall be computed under section 1452 of this title, and the difference between the amount deducted before the computation of that recalculated annuity and the amount that would have been deducted on the basis of that recalculated annuity shall be refunded to the surviving spouse or former spouse.
DISCUSSION AND CONCLUSIONS:

1.  The applicant made an SBP election for spouse coverage effective 9 January 1990.  He appears to have opted to suspend his retired pay in order to receive VA compensation as the monthly pay, since it appears it was greater than his retired pay.  Because he elected enrollment in the SBP, a direct remittance account was established deducting his SBP premiums from his VA compensation.  These circumstances did not invalidate his SBP election.

2.  If he had died any time after his enrollment in the SBP, his beneficiary (widow) would have been entitled to the SBP annuity at the rate of 55 percent of his retired pay with a potential offset based on receipt of DIC. 

3.  His spouse died on 14 June 2014.  A member with spouse coverage, who subsequently loses that spouse to death, may elect to suspend coverage.  Death does not permanently terminate SBP spouse coverage.  Coverage and costs are simply suspended pending future events.  

4.  The statute governing the refund of SBP premiums when DIC exceeds the SBP annuity applies to the veteran's surviving spouse.  It is not applicable to veterans in cases where the spouse dies before the veteran.  As such, this statute does not provide a basis for returning SBP premiums to him.  

5.  While he may now be dissatisfied with his decision to elect SBP coverage for his spouse, that alone is not evidence of an error.  If he can provide evidence showing his voluntary SBP election for spouse coverage was improper, he may submit a request for reconsideration.  

BOARD VOTE:

________  ________  ________  GRANT FULL RELIEF 

________  ________  ________  GRANT PARTIAL RELIEF 

________  ________  ________  GRANT FORMAL HEARING

____X___  ____X___  ____X___ DENY APPLICATION






BOARD DETERMINATION/RECOMMENDATION:

The evidence presented does not demonstrate the existence of a probable error or injustice.  Therefore, the Board determined that the overall merits of this case are insufficient as a basis for correction of the records of the individual concerned.



      ___________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)                                         AR20150003130



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ABCMR Record of Proceedings (cont)                                         AR20150003130



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