Barry v. McDonough: Federal Court Ruling Expands VA Special Monthly Compensation
CCK Law: Our Vital Role in Veterans Law
Barry v. McDonough, 101 F.4th 1348, 1350 (Fed. Cir. 2024), is a 2024 Federal Court decision that changed how Special Monthly Compensation (SMC) is calculated by the Department of Veterans Affairs (VA) for veterans with multiple severe service-connected disabilities.
In short, if you qualify for more than one intermediate-rate SMC increase under 38 CFR § 3.350(f), VA must now consider each of your qualifying conditions individually, rather than capping you at just one intermediate rate increase.
In this article, you will learn more about what this means and how it can lead to higher monthly payments for your SMC claim.
Key points of this article include:
- The old rule—In the past, VA would only apply one intermediate SMC rate increase no matter how many additional serious disabilities a veteran had.
- The new rule—In Barry v. McDonough, the Federal Circuit said VA must now apply a separate rate increase for each qualifying disability, rather than just one.
- Who this affects—Veterans receiving SMC who have additional service-connected disabilities rated at 50 percent or higher, or a single disability rated at 100 percent, that are separate and distinct from the condition(s) originally qualifying them for SMC.
- Potential impact—Veterans whose prior SMC decisions applied the old cap may be entitled to higher ongoing benefits or retroactive compensation, depending on the status of their claim.
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What Happened in Barry v. McDonough?
Barry v. McDonough was a 2024 court case that went before the U.S. Court of Appeals for the Federal Circuit. This case directly addressed how VA applies intermediate-rate SMC increases under 38 CFR § 3.350(f)(3).
The case was brought by Daniel D. Barry, an Army Veteran who suffered severe combat injuries, including an above-the-knee amputation of his right leg. He also had many other serious service-connected conditions, such as PTSD and severe arthritis in both shoulders.
VA had awarded Barry SMC based on his most severe physical injuries but refused to apply multiple intermediate-rate increases for his other qualifying conditions. Barry argued that 38 CFR § 3.350(f)(3) entitled him to an increase for each additional disability or combination of disabilities independently rated at 50 percent or more, not just one increase total.
The Board of Veterans’ Appeals (BVA) and then the Court of Appeals for Veterans Claims (CAVC) both ruled against Barry. They concluded that the regulation permitted only a single SMC increase regardless of the number of qualifying disabilities. However, the Federal Circuit reversed that decision.
“In Barry v. McDonough, the U.S. Court of Appeals for the Federal Circuit held that VA regulations clearly allow more than one intermediate rate increase for Special Monthly Compensation,” says Bradley Hennings, partner at CCK Law. “That may sound technical, but it is a meaningful win for veterans with multiple severe service-connected disabilities.”
Watch CCK Law Partner Bradley Hennings discuss Barry v. McDonough:
What Is the Impact of Barry v. McDonough?
To understand why Barry v. McDonough matters, it helps to know how VA’s SMC system works.
Special Monthly Compensation (SMC) provides monthly payments for disabled veterans at rates higher than the standard rating schedule of 0 to 100 percent would typically allow. SMC is generally only considered if a veteran’s service-connected conditions are particularly severe or debilitating.
Under 38 USC § 1114, SMC is paid at a series of lettered rates (e.g., L, M, N, O, etc.) each tied to specific disability combinations, such as loss of use of a limb, blindness, or the need for Aid and Attendance.
Within this system, there are also “half-step” increases — called “intermediate rates” — that sit between the main levels (e.g. L ½ sits between levels L and M). These half-steps are available to veterans who have additional serious disabilities on top of the ones that originally qualified them for SMC.
For decades, VA interpreted the rules to mean a veteran could only receive one of these half-step increases, no matter how many additional serious disabilities they had. A veteran with three or four additional qualifying conditions got the same one increase as a veteran with just one additional qualifying condition.
In Barry v. McDonough, however, the Federal Circuit threw this interpretation out, forcing VA to recognize that these intermediate rate increases are a “mandatory entitlement” that apply separately for each qualifying disability or combination of disabilities, rather than as a single one-time benefit.
How Does Barry v. McDonough Help Veterans Pursuing SMC?
“In Barry, the Court held that VA’s regulation is unambiguous and does not limit veterans to only one intermediate rate increase,” says Bradley Hennings. “If a veteran separately qualifies for multiple increases under the regulation, VA must consider each one.”
Essentially, this means that if a veteran is suffering from several distinct conditions that each qualify that veteran for an intermediate increase in their SMC tier-level, VA is now required to take each of these into account, potentially bumping the veteran up by several SMC tiers and increasing their monthly compensation accordingly.
For example:
- Say a Veteran is receiving SMC Level L for service-connected Parkinson’s disease (PD). Later in life, the Veteran also develops service-connected diabetes (rated at 60 percent), PTSD (70 percent), and ischemic heart disease (60 percent).
- Before Barry v. McDonough, this Veteran would only have been able to receive one intermediate increase to their SMC level from these additional conditions. For instance, VA may have assigned them an intermediate rate increase for their diabetes alone, bumping the Veteran up to SMC(l ½).
- After Barry v. McDonough, VA must now consider each of these additional conditions separately and apply intermediate rate increases accordingly. In this case, the Veteran’s diabetes, PTSD, and heart disease would each individually qualify for an intermediate increase to the Veteran’s SMC level, potentially raising it to SMC(m ½).
- This new ruling allows for the possibility of a significant increase in monthly compensation. In 2026, SMC(l ½) was paid out at a monthly rate of $5,154, while SMC(m ½) was paid out at a rate of $5,780. That’s a difference of over $600 for one month alone.
Want to learn more about SMC(l)? Check out the video below, where CCK Law Attorney Brittani Howell and Managing Advocate Michelle DeTore cover the essentials:
Who Qualifies for Higher SMC After Barry v. McDonough?
“This decision is especially relevant for veterans with complex SMC fact patterns,” says Bradley Hennings. “You should pay close attention if you already receive SMC at the L level or higher and have multiple separate service-connected disabilities involving loss of use, paralysis, blindness, or the need for Aid and Attendance, and VA previously told you that you were limited to a single intermediate rate increase.”
More specifically, Barry may apply to veterans who:
- Are receiving SMC (most commonly at SMC levels L through N).
- Have additional service-connected disabilities (rated at 50 percent or more) that are separate and distinct from the conditions used to establish the base SMC award and involve different anatomical segments or bodily systems.
- Have a single additional disability independently rated at 100 percent, which may support a full-step increase under § 3.350(f)(4).
- Were previously told by VA that they could only receive one intermediate-rate SMC increase, or had an SMC claim denied or underpaid on that basis.
What Does Barry v. McDonough Mean for Pending and Past SMC Claims?
“Barry applies to veterans whose claims are currently pending at VA, the Board of Veterans Appeals, or any of the courts, or previously denied or underpaid because VA capped intermediate rate increases,” says Bradley Hennings. “In some cases, this decision may support higher ongoing SMC payments or retroactive benefits depending on the procedural posture of the claim.”
Since Barry v. McDonough now applies as a binding precedent from the Federal Circuit, veterans whose claims are currently pending may be able to raise Barry directly in those proceedings.
- Veterans with currently pending claims — raise Barry in the existing proceeding.
- Veterans with a final decision within the last year — file a Supplemental Claim (VA Form 20-0995), Higher-Level Review (VA Form 20-0996), or Board appeal (VA Form 10182).
- Veterans with a final decision more than a year old — the path forward is narrower and more fact-dependent (Supplemental Claim with new and relevant evidence, or potential CUE motion in limited circumstances). This is the group most in need of professional help. Contact CCK Law to tell us about your case.
CCK Law Partner Michael Lostritto goes over the 2026 COLA increase and new rates:
Disagree With a VA Decision? Contact CCK Law
If you disagree with a VA decision, consider contacting Chisholm Chisholm & Kilpatrick. An experienced, VA-accredited law firm may offer significant tools and resources in support of your appeal.
While past results do not guarantee future outcomes, CCK Law has had favorable outcomes in 98.5% of its actions before VA and a 95% win rate before the U.S. Court of Appeals for Veterans Claims (federal court). We have recovered over $1 billion in compensation for 36,000+ clients to date.
Contact us online or at 800-544-9144 to tell us about your case.
Frequently Asked Questions
How Do I File or Reopen a Claim Based on Barry v. McDonough?
The right path depends on where your SMC claim currently stands. Three scenarios cover most veterans.
If your claim is currently pending at VA, the Board, or a court. Raise Barry directly in your existing proceeding. For VA-level claims, this typically means submitting a written argument identifying each additional service-connected disability (or combination of disabilities) independently rated at 50 percent or more, and citing Barry v. McDonough, 101 F.4th 1348 (Fed. Cir. 2024). For Board appeals, the argument is submitted as part of the appellant brief or in supporting statements.
If your VA decision became final within the last year. You have three appeal options under the Appeals Modernization Act:
- Supplemental Claim (VA Form 20-0995)—File this if you have new and relevant evidence (for example, a private medical opinion documenting an additional severe disability not previously considered for SMC).
- Higher-Level Review (VA Form 20-0996)—File this if you believe VA misapplied the law to the existing record. Because Barry corrected a longstanding misinterpretation of § 3.350(f)(3), Higher-Level Review is often a strong fit.
- Board Appeal (VA Form 10182)—File this to take your case directly to the Board of Veterans’ Appeals, where Board judges have been actively applying Barry since 2024.
All three lanes have a one-year filing deadline from the date on the decision letter.
If your VA decision became final more than a year ago. Your options are narrower. A Supplemental Claim is still possible with new and relevant evidence, but the effective date will generally shift to the filing date rather than relating back to your original claim. In limited circumstances, a Clear and Unmistakable Error (CUE) motion may apply, though CUE has a high bar and is fact-specific. Consult a VA-accredited representative before deciding which path to pursue.
What is VA Special Monthly Compensation?
Special Monthly Compensation (SMC) is a benefit that provides the possibility for higher compensation rates than those offered on the standard 0 to 100 percent rating schedule. Typically, VA pays SMC to veterans whose service-connected disabilities are especially severe.
SMC is paid at a series of lettered rates (e.g., SMC(l), SMC(m), SMC(n), etc.) each corresponding to specific disability combinations such as blindness or the amputation of limbs.
What is an intermediate rate under 38 CFR § 3.350(f)?
An intermediate rate is a half-step increase between two adjacent lettered SMC levels. For instance, SMC(l ½) is the intermediate level between SMC(l) and SMC(m). SMC(m ½) is the intermediate level between SMC(m) and SMC(n), and so on.
Under 38 CFR § 3.350(f)(3), a veteran may receive an intermediate-rate increase for each additional service-connected disability or combination of disabilities that is independently rated at 50 percent or more, as long as those disabilities are separate and distinct from the ones forming the base SMC entitlement.
A full-step increase is also available under 38 CFR § 3.350(f)(4) for an additional single disability rated at 100 percent.
What are the SMC-L benefits?
As of 2026, SMC(l) awards veterans monthly compensation of $4,900.83, while SMC(l ½) awards $5,154.
SMC(l) is one of the most commonly awarded SMC levels. A veteran may qualify for SMC(l) based on conditions such as loss of use of certain limbs, being permanently bedridden, and more.
Because Barry v. McDonough most commonly applies to veterans at the L through N levels, veterans receiving SMC(l) who have additional qualifying disabilities should review whether the ruling may entitle them to a higher rate.
What is SMC(r), and how is it different from Aid and Attendance?
SMC(r) is a higher-tier SMC level available to veterans who require a greater level of daily assistance than standard Aid and Attendance.
While Aid and Attendance benefits can be available at several SMC levels (including through SMC(l)), SMC(r1) and (r2) are reserved for veterans who already qualify for SMC at the O level or its equivalent and additionally need regular or frequent Aid & Attendance.
Because Barry v. McDonough can, in some cases, move a veteran through the L-through-N levels toward SMC(o), the ruling may help establish the SMC(o) threshold required for SMC(r) eligibility. A veteran would still need to separately demonstrate the daily-assistance requirements of 38 CFR § 3.352(b).
What are the current SMC rates?
VA adjusts SMC rates annually based on federal cost-of-living adjustments (COLA). Read more about the 2026 SMC rates here:
