effect on the party's performance and requirements which may be imposed on the naval service to maintain and protect him during future duty assignments. The determination of physical disability is not based on such factors as a party's inability to meet the physical standards for enlistment or appointment; or his pending voluntary or involuntary retirement, discharge, or release; or that he does not meet the needs of the service for his special skills; or that he is not physically qualified for specialized duties, such as duty involving flying or duty aboard a submarine; or that he is not physically qualified for transfer to another service or another component or category within the naval service. DOD DIRECTIVE 1332.18 sets forth medical conditions and physical defects which normally render a part physically unfit for further duty. When there is reasonable doubt whether a party is fit or unfit, or as to the nature of the condition causing unfitness, these matters should be resolved on the basis of further clinical investigation and observation, and such other evidence as may be adduced. If after further clinical investigation and observation a reasonable doubt whether a party is fit or unfit still exists, that doubt shall be resolved in favor of the party.

(d) Finding Two: Incurred/Aggravated:

(1) Form of Finding Two. Finding Two of the PEB will be as follows:

That such disability (was) (was not) incurred while entitled to receive basic pay; or That such disability was aggravated while entitled to receive basic pay.

(2) Discussion—(i) Service incurred. "Incurred while entitled to basic pay" is defined in § 725.216 supra. For parties on active duty for more than 30 days, the PEB must determine whether each ratable condition was incurred while entitled to receive basic pay. "While entitled to receive basic pay" encompasses all types of duty which entitled the party concerned to receive active duty pay and any duty without pay, which may be counted the same as like duty with pay. A party is presumed to have been in sound mental and physical condition upon entering active service, except as to physical disabilities noted and recorded at the

time of entrance. Any disease or injury discovered after a party enters active service is presumed to have been incurred while entitled to receive basic pay, in the absence of clear evidence to the contrary. Determinations concerning the inception of disease or injury, not noted at the time of entry, should not be based on medical judgment alone, as distinguished from accepted medical principles, or on history alone, without regard to clinical factors pertinent to the basic character, origin, and development of such disease or injury. This determination should be based on a thorough analysis of the entire evidentiary showing in the individual case and a careful correlation of all material facts, with due regard to accepted medical principles pertaining to the history, manifestations, clinical course, and character of such disease or injury.

(ii) Service aggravated. “Aggravation by service" is defined in § 725.206 supra. When, by clear evidence, it is determined that a condition originated before entry on active military service, the PEB must further consider whether the condition was aggravated by military service. Any additional disability resulting from the preexisting physical condition will be presumed to have been caused by service aggravation and, as required by § 725.231 only specific findings of "natural progression" of the preexisting disease or injury based on accepted medical principles, as distinguished from medical opinion alone, are sufficient to overcome the presumption of service aggravation. However, in the case of parties with more than 3 years' service, any increase in the severity of a preexisting disease or injury will be considered as evidence of service aggravation, provided that such increase in severity is not due to the party's intentional misconduct or willful neglect or was not incurred during a period of unauthorized absence.

(e) Finding Three: Misconduct or willful neglect/unauthorized absence:

(1) Form of Finding Three. Finding Three of the PEB shall be as follows: That such disability (is) (is not) due to intentional misconduct or willful neglect and

(was) (was not) incurred during a period of unauthorized absence.

(2) Discussion. The PEB is responsible for recommending a finding as to whether or not the disability is the result of the party's intentional misconduct or willful neglect, and whether or not the disability was incurred during a period of unauthorized absence. "Misconduct" is defined in § 725.223 supra, and "unauthorized absence" is defined in § 725.241, supra. The law presumes that any disease or injury was incurred in line of duty, unless there is clear and convincing evidence of intentional misconduct or willful neglect, or that it was incurred during a period of unauthorized absence. Any reasonable doubt will be resolved in favor of the party. The JAG Manual, Chapter VIII, prescribes the manner in which the Line of Duty determinations are made. Evidence received in Line of Duty determinations made in accordance with the JAG Manual, Chapter VIII, is material evidence to be considered by the PEB in arriving at their findings. The record of proceedings in all cases, other than disabilities incurred as a result of enemy action, shall contain documentation which explains the circumstances surrounding the incurrence of the disability. The documentation may be either the report of a fact-finding body (formal or informal), an Injury Report Form, NAVJAG 5800/15, depositions, statements, or testimony elicited at a formal hearing. When a disability is incurred at any time during a period of unauthorized absence, regardless of whether the absence interfered with the member's military duties, the member is excluded from receiving benefits under 10 U.S.C. chapter 61.

(f) Finding Four: Proximate result/ line of duty:

(1) Form of Finding Four. Finding Four of the PEB shall read as follows:

(i) That such disability (is) (is not) the proximate result of active duty (because of aggravation), or

(ii) That such disability (was) (was not) incurred in line of duty in time of war or national emergency, or

(iii) The party has at least 8 years of active service.

(2) Discussion. Unless the party has 8 or more years' active service, the PEB must determine whether each diagnosis listed, which constitutes the party's disability, was the proximate result of the performance of active duty, or that such disability was incurred in line of duty in time of war or national emergency. Disease or injury incurred by naval personnel on active duty for more than 30 days, while serving on active service, is considered to have been incurred in line of duty unless one of the exceptions listed in this 725.218 applies. A finding regarding proximate result (defined in § 725.232 supra) must be made in injury cases when the member is on active duty orders for 30 days or less, on training duty under 10 U.S.C. 270(b), or on inactive duty training orders.

(g) Finding Five: Permanency of disability:

(1) Form of Finding Five. Finding Five of the PEB shall be as follows:

That accepted medical principles indicate that such disability (is) (may be) permanent.

(2) Discussion. The PEB will determine for each diagnosis listed, whether the disability "is permanent" or "may be permanent" and record its finding for each (see § 725.230). A disability will be considered as "may be permanent" when, based on medical experience in like cases, it is considered that:

(i) The party may become fit to perform the duties of his office, grade, rank, or rating within 5 years from retirement or separation, or

(ii) The compensable percentage rating may, if less than 80 percent, change within said 5 years, or

(iii) The compensable percentage rating, if 80 percent or more, may reduce below 80 percent during said 5 years.

(h) Finding Six: Percentage ratings: (1) Form of Finding Six. Finding Six of the PEB shall be as follows:

That such disability is ratable at ( ) percent under the standard Schedule for Rating Disabilities in current use by the Veterans' Administration, as follows: (tabulate method for determining percentage).

(2) Discussion. The law provides for the use of the Veterans' Administration Schedule for Rating Disabilities (VASRD) in determining the percentage of disability of a party who is found to be unfit because of physical disability and is otherwise eligible for disability benefits. The VASRD does not prescribe standards under which fitness for military duty may be determined. A party may have a disability which is ratable in the VASRD, but which is not considered to be of sufficient importance to render him unfit for duty. Therefore, the VASRD is not to be used until the party has been found unfit to perform his duties. The board members and reviewers must be familiar with the entire contents of the VASRD, including the general policies, introductory paragraphs to sections, and italicized footnotes. Failure to adhere to criteria of the Schedule, except as provided in DOD DIRECTIVE 1332.18, will result in error and consequent delay in disability processing. Some of the rules more commonly used in applying the Schedule are as follows:

(i) Degree of severity. The basis of disability evaluation, and of the assessment of degrees of severity of disabilities, is the ability of the individual as a whole, to function under the circumstances of ordinary activity; that is, in daily life under normal environment. In this connection, it must be remembered that an individual may be too ill, weak, or otherwise disabled, to engage in work, although he may be up and about and fairly comfortable at home or upon limited activity.

(ii) Disabilities not listed. In view of the number of atypical instances, it is not expected that every disability evaluated will show all of the symptoms and signs described in the various Veterans Administration ratings. Since the codes merely mention the most common ones, sign and symptoms of closely related disabilities will be considered by analogy. Findings sufficiently characteristic to identify the disability and its degree of severity and, above all, coordination of the rating with the impairment of function must be made in all instances.

(iii) Reasonable doubt. When, after careful consideration of all evidence, a

reasonable doubt arises regarding the degree of severity of a disability, such doubt shall be resolved in favor of the party.

(iv) Pyramiding. Evaluation and rating of the same disability under more than one diagnosis (pyramiding) shall be avoided.

(v) Zero rating. Occasionally a disability is of such mild degree that it does not meet the criteria even for the lowest rating provided in the VASRD under the applicable diagnostic code number. A zero percent rating may be applied in such cases although the lowest listed rating is 10 percent or more. However, in instances in which the VASRD specifies a "minimum rating," a rating no lower than the prescribed minimum shall be assigned.

(vi) Amputation rule. The combined permanent rating for disabilities of an extremity shall not exceed the rating for the amputation level next higher than the site of the injury. A disability of an extremity shall not be given a higher rating that would be given if the limb were amputated at the most distal of the customary amputation sites which would include the affected area (region) in the part removed.

(vii) Interpolation of VA ratings. Although rating scales in the VASRD have been carefully constructed and tested to reflect proper ratings for varying degrees of severity of a disability based on the nature of the disease and the progression of its manifestations, in many instances ratings cannot be graduated in precise increments of 10, but will range from 20 percent to 40 and 80, or from 30 percent to 60 and 80. Interpolation of these ratings shall not be attempted by Navy adjudicative bodies in the disability system.

(viii) Combined compensable rating. If the party is found to be physically unfit and eligible for disability benefits, the percentages of all compensable disabilities are combined in the manner prescribed in paragraph 25 of the VASRD.

(a) Combined compensable ratings will be converted to the nearest number divisible by 10, and combined ratings ending in 5 will be adjusted upward.

(b) When a partial disability results from disease or injury, of both arms, or both legs, or paired skeletal muscles, or there is a bilateral involvement of peripheral nerves, 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 (not combined) before proceeding with further combinations or converting to the combined compensable rating. For example, if ratings for disabilities in paired extremities are combined to equal 59 percent, 5.9 percent (10 percent bilateral factor) will be added to the 59 percent to total 64.9 percent which is then converted to 65 percent and, in accordance with the same rule, is converted to 70 percent. This is proper even though the combined rating was less than 65 percent and underwent two upward conversions.

(ix) Prescribed VA Codes in accordance with the VASRD will be assigned to each diagnosis listed on NAVSO 6100/16. In selecting appropriate codes, consider the following:

(a) Description of functional impairment in medical records must be checked against the VASRD name of the disease or injury and its modifying terms.

(b) Related diagnoses should be merged for rating purposes when the VASRD provides a single code covering all their manifestations. This prevents pyramiding and reduces chance of overrating.

(i) Basis of recommended findings: It is essential that the record clearly reflect facts sufficient to form the basis for the recommended findings. Accordingly, the board should state in the record its basis for conclusions on issues where the record presents substantial evidence for more than one conclusion on such issues. In any case where the board makes a finding of misconduct or not in line of duty which conflicts with the approved findings of any other fact-finding body of which the board has knowledge, the board shall state in the record the basis for its conclusions.

§ 725.520 Recommended findings, inactive duty training.

The board shall use the same phraseology in its recommended findings as prescribed in § 725.519, except the words "inactive duty training" shall be substituted for the words "active duty" in recommended findings § 725.518(f)(1)(i).

NOTE: For §§ 725.519 and 725.520: If not the result of an injury, no additional recommended findings are required. If the result of an injury, then the subsequent recommended findings shall relate only to disability resulting from the injury and a recommended finding whether the disability is the approximate result of performing such duty shall be made under finding (4)a of § 725.518(a).

arising under 10 U.S.C. sections 1004 and 1163.

(a) Boards acting in cases arising under 10 U.S.C. 1004 and 1163 shall make the following recommended findings:

It is recommended that (name of party) be found (physically qualified) (not physically qualified) for active duty in the (U.S. Naval Reserve) (U.S. Marine Corps Reserve).

(b) If it is recommended that the party be found not physically qualified, the board shall set forth the disqualifying defect or disability, and the diagnostic nomenclature number (ICDA number) therefor, and give an opinion as follows:

Such disability (is) (is not) due to intentional misconduct or willful neglect.

(c) In determining the party's physical qualifications for active duty, the impairment of function suffered will be correlated with the requirements of

the duties to which he may reasonably expect to be assigned if recalled to active duty in his current rank or rate.

§ 725.522 Recommended findings, cases arising under 10 U.S.C. section 6331. Boards acting in cases arising under 10 U.S.C. 6331 shall make the following recommended findings only:

It is recommended that (name of party) be found (physically qualified) (not physically qualified) for active duty in the (Fleet Reserve) (Fleet Marine Corps Reserve).

If it is recommended that the party be found not physically qualified, the board shall set forth the disqualified defect or disability and the diagnostic nomenclature number (ICDA number) therefor.

The party or his counsel shall be advised of the board's recommended findings and shall be afforded 5 days, exclusive of Saturdays, Sundays, and holidays, after receipt of a copy of the record of proceedings of the board, in which to file a rebuttal. A rebuttal will set forth, specifically, the recommended findings of the board with which the party or his counsel does not concur, together with proposed alternate recommended findings which are acceptable to the party. It is not mandatory, but desirable, that a brief, setting forth the legal and factual basis for such nonconcurrence or any other request for relief, be included in the

rebuttal. In any case where a PEB is directed to conduct a new hearing or proceedings in revision and the party or his counsel files a rebuttal to the recommended findings arrived at in such proceedings, the rebuttal shall operate to afford the party an automatic appeal to the Naval Physical Disability Review Board, provided:

(a) The recommended findings of such PEB differ in a material respect, detrimental to the party, from any prior recommended findings made in the case by a PEB; and

(b) The proposed substitute findings thereafter made by the Physical Review Council differ in a material respect, detrimental to the party, from the relief sought in his rebuttal.

§ 725.526 Preparation and authentication of proceedings.

The record of proceedings of a PEB shall be prepared in accordance with this Manual.

§ 725.527 Forwarding of record of proceedings.

(a) The complete record of proceedings of the PEB, together with all documents which were before the board, shall be submitted to the PRC. An original and four/five (as appropriate) copies of the record of proceedings shall be prepared by the PEB and distributed as follows:

(1) Original to Office of Naval Disability Evaluation (PRC)

(2) Copy 1 to be retained at PEB (3) Copy 2 to the party (NAVSO 6100/16 only) in informal hearings

NOTE: When it would be deleterious to party's health to receive his copy, this copy shall be filed in the original record of proceedings, unless specifically requested by the legal representative.

(4) Copy 3 to be filed in Health Record

(5) Copy 4 to DESC (NAVSO 6100/ 16 only)

(6) Copy 5 to counsel for the party (formal hearings only)

(b) Proceedings of the PEB's will be recorded on NAVSO Form 6100/16. Erasures and corrections must be initialed by the counsel for the board, or the Recorder, as appropriate.