SCAR(S) UNSTABLE OR PAINFUL

L. STEPANICK · 2026 · Case ID: 26005031

MIXED

Summary

The veteran, who served from January 12, 2000, to April 1, 2005, with a second period of service characterized as Other Than Honorable (OTH), appeals the denial of service connection for burn scars and seeks an increased rating for pseudofolliculitis barbae. The Board previously denied service connection for burn scars in May 2016, finding the injury occurred during a dishonorable period of service. However, new evidence, including the veteran's September 2025 testimony and medical evidence related to a psychiatric disorder, has been submitted, raising a reasonable possibility of substantiating the burn scar claim. The Board found this new and material evidence sufficient to reopen the claim. Regarding pseudofolliculitis barbae, the veteran sought an increased rating from January 2, 2018. The Board reviewed the case under both prior and current rating criteria for skin conditions. Evidence indicated the veteran's pseudofolliculitis barbae required constant or near-constant use of topical hydrocortisone cream, a factor for a 60 percent rating under the applicable criteria. The Board found the veteran's testimony credible regarding his use of corticosteroid creams. Consequently, the Board granted a 60 percent rating for pseudofolliculitis barbae effective January 2, 2018. The case is remanded for readjudication of the burn scar claim and a new determination on the character of discharge, considering recent regulatory changes and new evidence regarding the veteran's mental state at the time of misconduct.

Rationale

New and material evidence submitted since May 2016 Board decision; Testimony regarding mental state and injuries; Medical evidence of psychiatric disorder relates to service and injuries

Special Benefit

NO SPECIAL BENEFIT

Docket No.

20-29 956A

Full Decision Text

Citation Nr: 26005031
Decision Date: 04/29/26 Archive Date: 04/29/26

DOCKET NO. 20-29 956A
DATE: April 29, 2026

ORDER

New and material evidence having been received, the claim for service connection for burn scars is reopened.

A 60 percent rating, but no higher, for pseudofolliculitis barbae is granted effective January 2, 2018.

REMANDED

Whether the character of the Veteran's discharge from service for the period from January 13, 2003, to April 1, 2005, constitutes a bar to the receipt of Department of Veterans Affairs (VA) compensation benefits is remanded.

Entitlement to service connection for burn scars is remanded.

FINDINGS OF FACT

1. A May 2016 Board decision denied service connection for burn scars and was not appealed or reconsidered.

2. Some of the evidence received since the May 2016 Board decision relates to an unestablished fact necessary to substantiate the previously denied claim.

3. For the period on appeal beginning January 2, 2018, and thereafter, the evidence addressing whether the Veteran's pseudofolliculitis barbae has required constant or near-constant systemic therapy including corticosteroids is at least approximately balanced.

CONCLUSIONS OF LAW

1. The May 2016 Board decision that denied service connection for burn scars is final. 38 U.S.C. § 7103; 38 C.F.R. § 20.1100.

2. New and material evidence has been received to reopen the claim for service connection for burn scars. 38 U.S.C. § 5108; 38 C.F.R. § 3.156(a).

3. Resolving reasonable doubt in the Veteran's favor, from January 2, 2018 through August 19, 2020, the criteria for a 60 percent evaluation, but no higher, for pseudofolliculitis barbae disability are met. 38 U.S.C. §§ 1155, 5107; §§ 4.1, 4.3, 4.118, Diagnostic Code 7813.

REASONS AND BASES FOR FINDINGS AND CONCLUSIONS

The Veteran served on active duty from January 12, 2000, to January 12, 2003, and from January 13, 2003, to April 1, 2005. The Veteran was discharged with an Other than Honorable (OTH) discharge for his second period of service due to several acts of misconduct. VA has determined that VA compensation is not payable for any service-connected conditions for his second period of service. The character of the Veteran's discharge is a part of this appeal, as discussed below.

This matter comes before the Board of Veterans' Appeals (Board) on appeal from February 2018 rating decisions of the Department of Veterans Affairs (VA) Regional Office (RO), the Agency of Original Jurisdiction (AOJ).

In an April 2024 decision, the Board granted an increased rating of 60 percent for pseudofolliculitis barbae, effective August 20, 2020. The Board also denied the Veteran's request to reopen a claim for service connection for burn scars and entitlement to a compensable rating for pseudofolliculitis barbae prior to August 20, 2020. The Veteran then appealed the Board's unfavorable determination to the United States Court of Appeals for Veterans Claims (CAVC). Pursuant to a Joint Motion for Partial Remand, the CAVC issued a January 2025 Order that vacated the April 2024 denial of the request to reopen the claim for service connection for burn scars and the denial of entitlement to a compensable rating for pseudofolliculitis barbae prior to August 20, 2020, and remanded the underlying claims to the Board to afford the Veteran with a Board hearing and readjudication of his claims.

The Veteran was subsequently afforded a hearing before the undersigned Veterans Law Judge in September 2025. A transcript of the hearing is associated with the claims file.

As an initial matter, "Veteran status" is an element of a claim for service connection. See D'Amico v. West, 209 F.3d 1322, 1326 (2000) ("[a] claim for veteran's disability benefits has five elements: (1) veteran status; (2) existence of a disability; (3) service connection of the disability; (4) degree of disability; and (5) effective date of the disability").

The AOJ determined that the Veteran's burn scar disabilities were not subject to compensation because they occurred during
was subsequently afforded a hearing before the undersigned Veterans Law Judge in September 2025. A transcript of the hearing is associated with the claims file.

The AOJ determined that the Veteran's burn scar disabilities were not subject to compensation because they occurred during the period of service that is currently characterized as dishonorable for VA purposes.

In his appeal, the Veteran sought compensation for burn scars, which had been denied on the basis of his character of discharge. In his appeal, the Veteran challenged the finding that his character of discharge constituted a bar to VA compensation benefits for his second period of service. Therefore, under D'Amico, the Board finds that the Veteran is also appealing the regulatory bar to VA compensation benefits based on his character of discharge. As such, the issue has been added to this decision and is addressed below.

Regarding the Veteran's increased rating claim for pseudofolliculitis barbae, the Board notes that new VA-created evidence has been associated with the claims file since issuance of the last supplemental statement of the case, and the Veteran has not waived AOJ consideration of this evidence. However, to the extent this evidence is relevant to the issue adjudicated herein (which the Board again notes is entitlement to a higher rating for pseudofolliculitis barbae prior to August 20, 2020, only) as the Board is granting the benefit sought, the Veteran will not be deprived due process and remanding the issue would result in an unnecessary burden on VA without further benefiting the Veteran. See Soyini v. Derwinski, 1 Vet. App. 540, 546 (1991) (holding that unnecessary burdens should not be imposed on VA without a benefit flowing to the veteran).

New and Material Evidence

Generally, a claim that has been denied by an unappealed AOJ decision or an unappealed Board decision may not thereafter be reopened. 38 U.S.C. §§ 7104(b), 7105(c). An exception to this rule exists for cases in which new and material evidence is presented or secured with respect to a claim that has been disallowed, in which case the claim must be reopened and the former disposition reviewed. 38 U.S.C. § 5108.

"New" evidence means evidence not previously submitted to agency decisionmakers, and "material" evidence means evidence that, by itself or when considered with previous evidence of record, relates to an unestablished fact necessary to substantiate the claim. New and material evidence can be neither cumulative nor redundant of the evidence of record at the time of the last denial of the claim sought to be reopened and must raise a reasonable possibility of substantiating the claim. 38 C.F.R. § 3.156(a). This is a "low threshold" in which the phrase "raises a reasonable possibility" should be interpreted as "enabling rather than precluding reopening." Shade v. Shinseki, 24 Vet. App. 110, 121 (2010). The credibility of the newly submitted evidence is presumed, although not blindly accepted as true if patently incredible. Justus v. Principi, 3 Vet. App. 510 (1992

1. Whether new and material evidence has been received to reopen the claim for service connection for burn scars.

The Veteran seeks to reopen his claim of entitlement to service connection for burn scars.

In an August 2014 rating decision, the AOJ denied the Veteran's claim for service connection for burn scars. The Veteran filed a timely appeal of the August 2014 rating decision, and, in a May 2016 decision, the Board denied the burn scars claim because the Veteran's burn injury had occurred in September 2004, during a period of service that was found to be dishonorable for VA purposes. The May 2016 Board decision is final.

At the time of the prior Board decision in May 2016, the record included third- party lay statements, the Veteran's military personnel and service treatment records, and post-service VA and private treatment records. The service treatment records were absent complaints of, or treatment for, burn scars prior to January 13, 2003.

In January 2018, the Veteran applied to reopen his claim of entitlement to service connection for burn scars. To reopen the previously denied claim, the evidence submitted since the last final denial (May 2016) must be new and material.

occurred in September 2004, during a period of service that was found to be dishonorable for VA purposes. The May 2016 Board decision is final.

The pertinent question is whether the Veteran has submitted new and material evidence since the May 2016 Board decision that, when viewed alongside the evidence already of record, raises a reasonable possibility of substantiating the claim of entitlement to service connection for burn scars.

After a thorough review of the entire record, the Board concludes that new and material evidence sufficient to reopen the claim of entitlement to service connection for burn scars has been submitted.

Here, in the February 2018 rating decision on appeal, the AOJ found that readjudication was not warranted because no new and material evidence had been received. However, the Board notes that in September 2025, the Veteran provided testimony before the Board regarding this condition. The facts within his testimony go to whether the act leading to the claimed injuries was willful misconduct, and thus not incurred in the line of duty. Additionally, the Veteran submitted evidence related to his mental state in service. Furthermore, medical evidence of a psychiatric disorder has been obtained which relates to his service and claimed injuries.

Therefore, the Board finds that new and material evidence has been received sufficient to readjudicate the claim of entitlement to service connection for burn scars. Readjudication of the claim is warranted. The underlying claims are addressed in the Remand portion of this decision, below.

Increased Rating

Disability ratings are determined by applying the criteria set forth in the VA Schedule for Rating Disabilities (rating schedule), found in 38 C.F.R. Part 4. The Board attempts to determine the extent to which a veteran's service-connected disability adversely affects his or her ability to function under the ordinary conditions of daily life, and the assigned rating is based, as far as practicable, upon the average impairment of earning capacity in civil occupations. 38 U.S.C. § 1155; 38 C.F.R. §§ 4.1, 4.10.

When a reasonable doubt arises regarding the degree of disability, such doubt will be resolved in favor of the claimant. 38 C.F.R. § 4.3. If there is a question as to which evaluation to apply to a veteran's disability, the higher evaluation will be assigned if the disability picture more nearly approximates the criteria for that rating. Otherwise, the lower rating will be assigned. 38 C.F.R. § 4.7.

A Veteran's entire history is to be considered when making disability evaluations. See 38 C.F.R. 4.1, 4.2; Schafrath v. Derwinski, 1 Vet. App. 589 (1995). Where the issue involves the assignment of a disability rating following the initial award of service connection for that disability, as is the case here, the entire history of the disability must be considered, and separate ratings can be assigned for separate periods of time based on the facts found, a practice known as "staged" ratings. Fenderson v. West, 12 Vet. App. 119, 126 (1999).

In making all determinations, the Board must fully consider the lay assertions of record. A Veteran is competent to report on that of which he or she has personal knowledge. Layno v. Brown, 6 Vet. App. 465, 469 (1994). When considering whether lay evidence is competent, the Board must determine on a case by case basis whether a veteran's particular disability is the type of disability for which lay evidence may be competent. See Kahana v. Shinseki, 24 Vet. App. 428, 435 (2011); see also Jandreau v. Nicholson, 492 F.3d 1372, 1376 -77 (Fed. Cir. 2007).

The Board must assess the credibility and weight of all the evidence, including the medical evidence, to determine its probative value, accounting for evidence that it finds to be persuasive or unpersuasive, and providing reasons for rejecting any evidence favorable to the claimant. See Wilson v. Derwinski, 2 Vet. App. 614, 618 (1992); Hatlestad v. Derwinski, 1 Vet. App
be competent. See Kahana v. Shinseki, 24 Vet. App. 428, 435 (2011); see also Jandreau v. Nicholson, 492 F.3d 1372, 1376 -77 (Fed. Cir. 2007).

The Board must assess the credibility and weight of all the evidence, including the medical evidence, to determine its probative value, accounting for evidence that it finds to be persuasive or unpersuasive, and providing reasons for rejecting any evidence favorable to the claimant. See Wilson v. Derwinski, 2 Vet. App. 614, 618 (1992); Hatlestad v. Derwinski, 1 Vet. App. 164 (1991). Equal weight is not necessarily accorded to each piece of evidence contained in the record; not every item of evidence necessarily has the same probative value.

2. A 60 percent rating, but no higher, for pseudofolliculitis barbae is granted effective January 2, 2018.

The Veteran is seeking a higher rating for his pseudofolliculitis barbae with residual scarring based on the severity of his skin symptoms. Specifically, the Veteran seeks an increased rating from January 2, 2018, the date that he filed his supplemental claim for an increased rating. See September 2025 Board hearing.

For the reasons discussed below, the Board finds that a rating of 60 percent, but no higher, is warranted effective January 2, 2018.

As an initial matter, the Board notes that the appeal period is from January 2, 2018, the date of the Veteran's increased rating claim, plus the one-year "look back" period. 38 C.F.R. § 3.400(o)(2); Gaston v. Shinseki, 605 F.3d 979, 982 (Fed. Cir. 2010).

The Veteran's pseudofolliculitis barbae is rated under Diagnostic Code 7813, for dermatophytosis.

VA amended the criteria for rating skin disabilities effective from August 13, 2018. These new regulations apply to all applications for benefits received by VA or that are pending before the agency of original jurisdiction on or after August 13, 2018. Claims pending prior to the effective date will be considered under both the old and new rating criteria, and whatever criteria is more favorable to the veteran will be applied. The Board may not apply a current regulation prior to its effective date, unless the regulation explicitly provides otherwise. Kuzma v. Principi, 341 F.3d 1327 (Fed. Cir. 2003). However, the Board is not precluded from applying prior versions of the applicable regulation to the period on or after the effective dates of the new regulation if the prior version was in effect during the pendency of the appeal.

Prior to August 13, 2018, Diagnostic Code 7813 instructed to rate as disfigurement of the head, face, or neck (DC 7800) or scars (DCs 7801, 7802, 7803, 7804, or 7805), or dermatitis (7806) depending on the predominant disability. 38 C.F.R. § 4.118 (2018).

Here, the evidence of record demonstrates that the predominant disability is pseudofolliculitis barbae.

Prior to August 13, 2018, under Diagnostic Code 7806, a maximum 60 percent rating is assigned for more than 40 percent of the entire body or more than 40 percent of exposed areas affected, or; constant or near-constant systemic therapy such as corticosteroids or other immunosuppressive drugs required during the past 12- month period. Or rate as disfigurement of the head, face, or neck (DC 7800) or scars (DC's 7801, 7802, 7803, 7804, or 7805), depending on the predominant disability. 38 C.F.R. § 4.118, Diagnostic Code [7806, 7815, 7816, 7821, 7822].

Effective August 13, 2018, a new General Rating Formula for the Skin applies to Diagnostic Codes 7806, 7809, 7813 to 7816, 7820 to 7822, and 7824. See 38 C.F.R. § 4.118.

Under this formula, a noncompensable rating is assigned for no more than topical therapy required over the past 12-month period and at least one of the following: characteristic lesions involving less than 5 percent of the entire body affected;
the predominant disability. 38 C.F.R. § 4.118, Diagnostic Code [7806, 7815, 7816, 7821, 7822].

Effective August 13, 2018, a new General Rating Formula for the Skin applies to Diagnostic Codes 7806, 7809, 7813 to 7816, 7820 to 7822, and 7824. See 38 C.F.R. § 4.118.

Under this formula, a noncompensable rating is assigned for no more than topical therapy required over the past 12-month period and at least one of the following: characteristic lesions involving less than 5 percent of the entire body affected; or characteristic lesions involving less than 5 percent of exposed areas affected.

A 10 percent rating is assigned for at least one of the following: characteristic lesions involving at least 5 percent, but less than 20 percent, of the entire body affected; or at least 5 percent, but less than 20 percent, of exposed areas affected; or intermittent systemic therapy including, but not limited to, corticosteroids, phototherapy, retinoids, biologics, photochemotherapy, PUVA, or other immunosuppressive drugs required for a total duration of less than 6 weeks over the past 12- month period.

A 30 percent rating is assigned at least one of the following: characteristic lesions involving more than 20 to 40 percent of the entire body or 20 to 40 percent of exposed areas affected; or systemic therapy including, but not limited to, corticosteroids, phototherapy, retinoids, biologics, photochemotherapy, PUVA, or other immunosuppressive drugs required for a total duration of 6 weeks or more, but not constantly, over the past 12-month period.

A 60 percent rating is assigned for at least one of the following: characteristic lesions involving more than 40 percent of the entire body or more than 40 percent of exposed areas affected; or constant or near-constant systemic therapy including, but not limited to, corticosteroids, phototherapy, retinoids, biologics, photochemotherapy, psoralen with long-wave ultraviolet-A light (PUVA), or other immunosuppressive drugs required over the past 12-month period. Or rate as disfigurement of the head, face, or neck (DC 7800) or scars (DC's 7801, 7802, 7803, 7804, or 7805), depending on the predominant disability. 38 C.F.R. § 4.118, General Rating for the Skin for DCs 7806, 7809, 7813-7816, 7820-7822, and 7824.

As noted above, in this case the predominant disability is pseudofolliculitis barbae.

Treatment notes from January 2018 indicate the Veteran was prescribed a 1% hydrocortisone cream for his skin condition with instructions to apply a "small amount topically twice a day as needed." See January 2018 CAPRI Records.

A February 2018 VA examination documents that the Veteran's pseudofolliculitis barbae affected less than five percent of the total body area and less than five percent of the exposed areas. The examiner noted that the Veteran had been prescribed a topical antibiotic, clindamycin phosphate solution, for a period of less than six weeks in duration due to a facial rash. However, there was no finding that corticosteroid or immunosuppressive medication was prescribed. See February 2018 Disability Benefits Questionnaire (DBQ).

Treatment records from April 2018 and thereafter indicate that the Veteran has had prescriptions for daily use of hydrocortisone cream throughout the period on appeal. His providers mention both his service-connected pseudofolliculitis barbae (also claimed as eczema) and non-service-connected dermatitis.

On August 20, 2020, the Veteran had another VA skin examination. The VA examiner diagnosed pseudofolliculitis barbae, seborrheic dermatitis, and burns with skin grafting (see above). Physical examination documented that the Veteran's pseudofolliculitis barbae had affected less than five percent of the total body area and less than five percent of the exposed areas. The VA examiner, however, found that the Veteran's treatment included constant or near-constant corticosteroids or other immunosuppressive medications. Specifically, the Veteran had treated with topical hydrocortisone cream used for both his pseudofolliculitis barbae and his seborrheic dermatitis. The VA examiner remarked that seborrheic dermatitis
examination. The VA examiner diagnosed pseudofolliculitis barbae, seborrheic dermatitis, and burns with skin grafting (see above). Physical examination documented that the Veteran's pseudofolliculitis barbae had affected less than five percent of the total body area and less than five percent of the exposed areas. The VA examiner, however, found that the Veteran's treatment included constant or near-constant corticosteroids or other immunosuppressive medications. Specifically, the Veteran had treated with topical hydrocortisone cream used for both his pseudofolliculitis barbae and his seborrheic dermatitis. The VA examiner remarked that seborrheic dermatitis was an additional condition unrelated to the service-connected pseudofolliculitis barbae.

The Board notes that the VA examiner noted constant or near-constant corticosteroids or other immunosuppressive medications, which had been prescribed on a continuous basis throughout the period on appeal.

The VA examiner, however, made no distinction between the required treatment for the Veteran service- and non-service-connection skin disorders. Therefore, the Board will not either. It is not clear from the VA examination report whether it was the Veteran's pseudofolliculitis barbae or his seborrheic dermatitis that required constant or near-constant hydrocortisone cream. A review of the relevant medical records does not answer this question.

However, the record indicates that the Veteran has had prescriptions for daily use of hydrocortisone cream throughout the period on appeal.

What is clear is that as his symptoms have increased, his use of the cream appears to have increased as well. For example, in August 2017, his medication was discontinued at least for a time because he was not using it. Hydrocortisone was not mentioned in the February 2018 VA examination report. However, the Veteran's treatment records indicate active continuous prescriptions for corticosteroid cream throughout the period on appeal.

Furthermore, the Veteran credibly testified that he uses corticosteroid creams two to three times per day, with diminishing results, to manage his pseudofolliculitis barbae. See September 2025 Board Hearing.

Based on the evidence of record and resolving reasonable doubt in the Veteran's favor, the Board finds that the evidence supports that his pseudofolliculitis barbae has required constant or near-constant systemic therapy including corticosteroids for the period on appeal.

As such, the Board finds that entitlement to an increased rating of 60 percent, but no higher, for pseudofolliculitis barbae is warranted for the period on appeal.

The Board has considered whether an increased rating may be effective during the one-year lookback period prior to the date of his claim for increase, but the Board has determined that it is not factually ascertainable that an increase in severity specifically took place during that time period. The Veteran does not specifically assert the worsening of his symptoms occurred during the one-year period prior to filing his claim, and the evidence does not indicate such an increase occurred during that time period. The evidence indicates that the Veteran discontinued regular use of a corticosteroid in August 2017 and there are no treatment records related to his dermatological conditions in the "lookback period." The Board finds that the record does not show any competent findings of worsening in the one-year period preceding his claim for an increased rating.

As noted above, under the General Rating Formula for the Skin applicable to Diagnostic Code 7813, a 60 percent rating is assigned for at least one of the following: (1) characteristic lesions involving more than 40 percent of the entire body or more than 40 percent of exposed areas affected; or (2) constant or near-constant systemic therapy including, but not limited to, corticosteroids, phototherapy, retinoids, biologics, photochemotherapy, psoralen with long-wave ultraviolet-A light (PUVA), or other immunosuppressive drugs required over the past 12-month period. That is the highest schedular rating under Diagnostic Code 7813. The Board has considered whether any other Diagnostic Codes related to disabilities of the skin would provide for a higher disability evaluation. However, the evidence does not reflect that the pseudofolliculitis barbae would warrant a higher rating under a different diagnostic code. See 38 C.F.R. § 4.118.

Accordingly, the Board is granting an increased rating of 60 percent, but no higher, for the Veteran's pseudofolliculitis barbae effective January 2, 2018.

In reaching the above conclusions, the Board has considered the benefit of the doubt doctrine and has applied it in assigning a 60 percent rating throughout the period under review. However
schedular rating under Diagnostic Code 7813. The Board has considered whether any other Diagnostic Codes related to disabilities of the skin would provide for a higher disability evaluation. However, the evidence does not reflect that the pseudofolliculitis barbae would warrant a higher rating under a different diagnostic code. See 38 C.F.R. § 4.118.

Accordingly, the Board is granting an increased rating of 60 percent, but no higher, for the Veteran's pseudofolliculitis barbae effective January 2, 2018.

In reaching the above conclusions, the Board has considered the benefit of the doubt doctrine and has applied it in assigning a 60 percent rating throughout the period under review. However, as to the remaining aspects of the claim, the evidence is persuasively against assignment of higher or separate ratings, and the doctrine is not applicable.

REASONS FOR REMAND

1. Whether the character of the Veteran's discharge from service for the period from January 13, 2003, to April 1, 2005, constitutes a bar to the receipt of VA compensation benefits is remanded.

2. Entitlement to service connection for burn scars is remanded.

The Board has determined that readjudication of the claim for service connection for burn scars is warranted, but the AOJ did not adjudicate that issue on the merits. In order to preserve the Veteran's right to one review on appeal under 38 U.S.C. § 7104, remand is required so that these issues may be considered on the merits by the AOJ in the first instance. Hickson v. Shinseki, 23 Vet. App. 394, 399 (2010).

Regarding the character of the Veteran's discharge, specifically, when a person is seeking VA benefits, it first must be shown that the service member, upon whose service such benefits are predicated, has attained the status of a 'veteran' for VA purposes. Holmes v. Brown, 10 Vet. App. 38, 40 (1997). "The term veteran means a person who served in the active military, naval or air service, and who was discharged or released therefrom under conditions other than dishonorable." 38 U.S.C. § 101(2). VA benefits are not payable unless the period of service upon which the claim is based was terminated by discharge or release under conditions other than dishonorable. 38 U.S.C. § 5303; 38 C.F.R. § 3.12(a). In certain cases, as here, VA healthcare benefits may be furnished for disabilities arising from service to servicemembers with discharges under other than honorable conditions. 38 C.F.R. § 3.360(b).

During the pendency of this appeal, in June 2024, amendments to the regulation governing character of discharge went into effect, expanding the compelling circumstances exception to include discharges involving willful and persistent misconduct.

The amendments to the regulation governing character of discharge went into effect while the Veteran's claim was being developed and provided for an exception that is applicable in this case. See 38 C.F.R. § 3.12(d)(2). Further, the development of the service connection claim generated evidence indicating that the Veteran was experiencing psychiatric symptoms at the time of the misconduct leading to discharge, as detailed above.

As status as a veteran is a threshold determination in each service connection claim, see D'Amico v. West, 209 F.3d 1322, 1326 (2000), and the regulatory framework for a character of discharge determination changed during the pendency of this appeal, the AOJ should reconsider the Veteran's status as a veteran for his second period of service.

The matters are REMANDED for the following action:

1. Review the claims file and issue a new character of discharge determination using the revised provisions of the regulation. See 38 C.F.R. § 3.12.

2. Conduct a de novo review of the claims file and readjudicate the issue of entitlement to service connection for burn scars on the merits.

L. STEPANICK

Veterans Law Judge

Board of Veterans' Appeals

Attorney for the Board M. O'Connor, Counsel

The Board's decision in this case is binding only with respect to the instant matter decided. This decision is not precedential and does not establish VA policies or interpretations of general applicability. 38 C.F.R. § 20.1303.

of entitlement to service connection for burn scars on the merits.

L. STEPANICK

Veterans Law Judge

Board of Veterans' Appeals

Attorney for the Board M. O'Connor, Counsel

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