VA regulations provide for referring a case for extraschedular consideration when a claimant demonstrates an "exceptional or unusual disability picture with such related factors as marked interference with employment or frequent periods of hospitalization as to render impractical the application of regular schedular standards." 38 C.F.R. § 3.321(b)(1). Consideration of referral for an extraschedular rating must begin with "a comparison between the level of severity and symptomatology of the claimant's service-connected disability [and] the established criteria found in the rating schedule for that disability." Thun v. Peake, 22 Vet. App. 111, 115 (2008). VA must evaluate whether "the rating schedule is inadequate to evaluate a claimant's disability picture." Id. at 116. The disability picture includes all of a claimant's service-connected disabilities. See 38 C.F.R. § 3.321(b)(1) (goal of extraschedular consideration is to arrive at "an extra-schedular evaluation commensurate with the average earning capacity impairment due exclusively to the service-connected disability or disabilities").
The award of an extraschedular disability rating is the result of a three-step inquiry the responsibility for which may be shared among the RO, the Board, and the Under Secretary for Benefits or the Director, Compensation and Pension Services. Thun, 22 Vet. App. at 115. The first step is to compare the level of severity and symptomatology of the appellant's disability with the established criteria in the rating schedule. Id. If these criteria "reasonably describe the claimant's disability level and symptomatology" then the regular schedular rating system is adequate and extraschedular referral is not warranted. Id.
If the rating schedule does not contemplate the claimant's level of disability and symptomatology and is found inadequate, then "the RO or Board must determine whether the claimant's exceptional disability picture exhibits other related factors," such as "marked interference with employment" or "frequent periods of hospitalization." 38 C.F.R. § 3.321(b)(1). When an analysis of the first two steps reveals that the rating schedule is inadequate to evaluate a claimant's disability picture, then the case must be referred to the Undersecretary for Benefits or the director of the Compensation and Pension Service to complete the third step which is to determine whether to assign an extraschedular disability rating in order to "accord justice." Thun, 22 Vet. App. at 116; 38 C.F.R. § 3.321(b)(1).
The Board must consider referral for an extraschedular rating when either a claimant or the evidence of record suggests that a schedular rating may be inadequate. See Thun v. Peake, 22 Vet. App. 111, 115 (2008). "The governing norm in these exceptional cases is: A finding that the case presents such an exceptional or unusual disability picture with such related factors as marked interference with employment or frequent periods of hospitalization as to render impractical the application of the regular schedular standards." 38 C.F.R. § 3.321(b). The effects of medications for service-connected conditions can warrant an extraschedular rating referral. Fisher v. Principi, 4 Vet. App. 57 (1993). Where the Board did not address whether referral for extraschedular consideration was warranted, the Court's review is "limited to whether the evidence of record sufficiently raises the possibility that this regulation is applicable, such that the Board was required to discuss whether referral was warranted [under section 3.321(b)(1)]." Barringer v. Peake, 22 Vet. App. 242, 245 (2009).