Re: I refuse to use CPAP now.What will happen
First, from my interactions with PEB Medical Board members, the common reaction to the situation you describe is that the issue is proper fitting and titration of the CPAP. I do not say this to agree or disagree with your decision, just what I think their response would be.
I think that the outcome, if your sleep apnea, untreated by CPAP use, is unfitting, would be separation without benefits due to "unreasonable refusal of treatment." Not that I am saying your decision is unreasonable, just what the theory would be to deny you benefits. However, if your back pain is separately rated, you may yet get to severance pay or retirement, depending on the facts.
The other thing to consider is that current experience shows that the PEBs are very unlikely to find Sleep apnea based on CPAP use. I do not agree that this de facto policy/common outcome is correct, just that in many cases your use or non-use of CPAP may not change the compensation outcome at the PEB (fit vs. unfit, but non-compensable).This is not to say you would not have a case on appeal, it is just to offer my observation on recent outcomes at the PEB. The issues are complicated, and if you want to get legal advice on your specific situation (which I do not give in posts) you should talk to an attorney. Your JAG may be able to help you with this issue.
The question regarding the VA outcome is more complicated and I would not want to offer a guess as to how this would play out. The only thing I would say is that the VA would clearly rate you at 50% if you used the CPAP.
I hope you get a good outcome at the PEB. Best of luck.
__________________ Jason
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