IN THE CASE OF: BOARD DATE: 3 December 2021 DOCKET NUMBER: AR20210008212 APPLICANT REQUESTS: * correction of his Survivor Benefit Plan (SBP) to show he elected a lower SBP coverage based on the threshold amount in effect on the date of his retirement * reimbursement of the difference in premium payments APPLICANT'S SUPPORTING DOCUMENTS CONSIDERED BY THE BOARD: DD Form 149 (Application for Correction of Military Record under the Provisions of Title 10, U.S. Code, Section 1552). FACTS: 1. The applicant states he elected SBP coverage based on the threshold amount upon his retirement and had his DD Form 2656 (Data for Payment of Retired Personnel) notarized. However, he was automatically enrolled in the SBP based on his full gross pay before his DD Form 2656 was processed. a. He inquired about the status numerous times as the form was being processed. Once he was informed that there was an issue with the form. He forgot to check a box. He was directed to complete a supplemental form and send that in to move the process forward. As he continued to inquire about the status, he was informed multiple times it had been approved and he should see the change reflected in his monthly earnings statement. b. After several months without a change in his election coverage, he inquired and was told the change had been denied and he needed to contact a Retirement Services Officer for correction. He contacted a Retirement Services Officer who inquired as to the reason the supplemental form with the corrected information was not accepted. The Retirement Services Officer was not given a reason. c. He was instructed to submit a DD Form 149 to the Army Board for Correction of Military Records. 2. U.S. Army Physical Disability Agency Orders 326-08, 22 November 2019, retired him by reason of permanent physical disability and placed him on the Retired List effective 27 December 2019. 3. His DD Form 2656 (Data for Payment of Retired Personnel), 12 December 2019, shows in: * item 29a (Spouse) – M____ * item 33 (Reserve Component Only) – he elected "Option C" – previously elected or defaulted to immediate Reserve Component-SBP Coverage (Do not make an election in Block 34, you have already elected coverage). Note: If you were married at the time you were notified of eligibility for non-regular retirement and did not complete a DD Form 2656-5, you defaulted to full coverage under Option C – do not make an election in Block 34 * item 34 (SBP Beneficiary Categories) – "No Entry" * item 35 (SBP Level of Coverage) – he elected item d (I Elect Coverage Based on the Threshold Amount in Effect on the Date of Retirement) (Spouse concurrence in required in Part V) * Part V (Spouse SBP Concurrence) – his spouse concurred and a notary public witnessed her signature on 12 December 2019 4. His DD Form 2656-8 (SBP – Automatic Coverage Fact Sheet), 2 April 2020, shows his marital and dependency status to correctly establish and maintain an accurate account of his retired pay account. His handwritten entries in the top margin state: * * Please note I am electing coverage for Spouse Only * * Elected Threshold amount, not full gross pay BOARD DISCUSSION: After reviewing the application, all supporting documents, and the evidence found within the military record, the Board found that relief was warranted. The applicant’s contentions, the military record, and regulatory guidance were carefully considered. The Board agreed members retiring due to a disability may not receive appropriate SBP counseling and offered to complete the DD Form 2656 in a timely manner. Based upon a preponderance of the evidence, the Board determined the applicant’s record should be corrected to show the he elected the threshold amount prior to retirement. BOARD VOTE: Mbr 1 Mbr 2 Mbr 3 :XX :XX :XX GRANT FULL RELIEF : : : GRANT PARTIAL RELIEF : : : GRANT FORMAL HEARING : : : DENY APPLICATION BOARD DETERMINATION/RECOMMENDATION: The Board determined the evidence presented is 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 show he completed a DD Form 2656-8 on 23 December 2019, electing spouse coverage at the threshold amount, and his request was received and approved by the appropriate HRC/DFAS office in a timely manner. The result of this correction should also provide him with back pay of the difference between premiums. 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. REFERENCES: 1. 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. The election must be made before the effective date of retirement or coverage defaults to automatic spouse coverage. 2. 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 provided less than maximum spouse coverage. 3. Department of Defense Instruction 1332.42 (Survivor Benefit Plan) establishes policy, assigns responsibilities, and provides procedures for administration of the SBP program, RCSBP program, Special Survivor Indemnity Allowance, and SBP Advisory Group. Section 8 (Base Amount and Threshold Amount) states the base amount is the amount of retired pay to which a member is or was entitled when first becoming eligible for that pay or later became entitled due to any post-retirement adjustments. The reduction in retired pay to pay SBP and RCSBP premiums is generally predicated on this base amount. The threshold amount is an alternative to the base amount that may be used to calculate the reduction in retired pay. The original threshold amount established on 1 October 1985 was $300. This amount has been increased by the same percentage as the annual increase in basic military pay for each year subsequent to 1985. 4. The Office of the Assistant Secretary of Defense memorandum (Adjustment to Military Retired and Retainer Pay, Survivor Annuities, and Premiums), 4 November 2020, provides detailed guidance regarding cost-of-living adjustments and other computational procedures applicable to military retired and retainer pay and survivor annuities. Retired pay and survivor entitlements are adjusted and computed as prescribed. The increase in the SBP Low-Cost Premium Threshold states: a. Previous amounts with respect to which the 2.5-percent factor of the SBP premium (cost) formula apply will be adjusted effective 1 December 2020 in conjunction with the adjustments in retired pay. The Defense Finance and Accounting Service will perform necessary calculations to determine actual premiums based on the individual circumstances of each case. b. The amount with respect to which the 2.5-percent factor of the SBP premium (cost) is applied will be increased to 3.0 percent effective 1 January 2021, from $869 to $895. The threshold premium is $22.38. Therefore, the Low-Cost Threshold premium is $22.38 plus 10 percent of the difference between retired pay and the threshold amount. //NOTHING FOLLOWS// ABCMR Record of Proceedings (cont) AR20210008212 4 ARMY BOARD FOR CORRECTION OF MILITARY RECORDS RECORD OF PROCEEDINGS 1