Understanding VA Pension and VA Pension with Aid and Attendance
"Aid and attendance" is a commonly used term for a little-known
veterans’ disability
income. The official title of this benefit is
"Pension." The reason for using "aid and attendance" to refer to
Pension is that many veterans or their single surviving spouses can
become eligible if they have a regular need for the aid and attendance
of a caregiver or if they are housebound. Evidence of this need for
care must be certified by VA as a "rating." With a rating, certain
veterans or their surviving spouses can now qualify for Pension.
Pension is also available to low income veteran households without a
rating, but it is a lesser dollar amount.

Pension is an Underused Benefit

There are different income categories for Pension, but the highest
could pay as much as $1,800 a month in disability income to a
qualifying veteran household. A study commissioned by VA in 2001
estimated, over the next 14 years, only about 30% of eligible veterans
would apply for Pension. The conclusion was most veterans simply don’t
know about it. In fact, according to the National Care Planning
Council, about a third of all seniors in this country, over the age of
65, could become eligible for pension under the right circumstances.
That’s how many elderly war veterans or their surviving spouses there
are. VA does not do a good job of educating eligible veterans about how
to obtain this benefit.

         

Eligibility Rules for Pension
To receive Pension, a veteran must have served on active duty, at least
90 days, during a period of war. There must be an honorable discharge.
Single surviving spouses of such veterans are also eligible. If younger
than 65, the veteran must be totally disabled. If age 65 and older,
there is no requirement for disability. There is no disability
requirement for a single surviving spouse.

         

The
veteran household cannot have income — adjusted for medical expenses
— exceeding the Maximum Allowable Pension Rate– MAPR — for that
veteran’s pension income category. If the adjusted income exceeds MAPR,
there is no benefit. If adjusted income is less than the MAPR, the
veteran receives a Pension income that is equal to the difference
between MAPR and the household income adjusted for medical expenses.
The pension income is calculated, based on 12 months of future
household income, but paid monthly.

              The Special Case for Long Term Care Costs
A special provision for calculating Pension income, allows household
income to be reduced by 12 months worth of future, recurring medical
expenses. Normally, income is only reduced by medical expenses incurred
in the month of application. These allowable, annualized medical
expenses are such things as insurance premiums, the cost of home care,
the cost of paying adult children to provide care, the cost of adult
day care, the cost of assisted living and the cost of a nursing home
facility. In most cases, these expenses are only deductible if there is
a rating.
             

         

This
special provision can allow veteran households earning more than the
annual MAPR to qualify for pension. As an example, a veteran household
earning $6,000 a month could still qualify for Pension if the veteran
is paying $4,500 to $6,000 a month for nursing home costs. The
applicant must submit appropriate evidence for a rating and for
recurring costs in order to qualify for this special provision. VA
normally does not tell applicants about this special treatment of
medical expenses or how to qualify for it.

         

Dealing with Assets That May Disqualify the Applicant
There is also an asset test to qualify for pension. Any asset or
investment that could be easily converted into income might disqualify
the claimant. An asset ceiling of $80,000 is often cited in the media
as being the test. The $80,000 has to do with VA internal filing
requirements and is not an actual test. In reality, there is no dollar
amount for the test and any level of assets could block the award. The
asset test ultimately becomes a subjective decision made by the
veterans service representative, processing the application.

         

A
home, used as a residence, vehicles and difficult-to-sell property are
generally excluded from the asset test. VA will allow assets to be
transferred or converted to income in order to meet the asset test.
There is no look back penalty for transferring assets as there is with
Medicaid. There are specific rules governing transfers of assets and
what constitutes income from assets and it must be done correctly.

         

A Qualified Consultant Can Provide the Necessary Advice for a Successful Award
Most VA employees understand the Pension claims process regarding low
income or disqualifying assets, but they generally do not understand
the special-case application process required for aid and attendance
and long term care costs. Evidence exists that VA employees who deal
with the public, may even be turning away long term care applicants,
telling them their income is too high. Of course, this is not true.

         

The
application form provides no information on the existence of this
special treatment for annualized medical expenses. If the initial
application, involving annualized costs, is not done correctly, delays
in record gathering could force the award decision to take up to a year
or the eventual award could be substantially reduced or even denied.
The applicant must wait another full year to reapply or go through a
time-consuming appeals process to correct any unfavorable decisions.

The Importance of a Using a Knowledgeable Consultant
Getting the aid and attendance benefit is a slow process even for those
applicants who know what they are doing. On the other hand, for those
who blindly submit a claim without the proper support documents, it can
take 8 to 12 months for a decision from VA. A poorly documented claim
may also result in a denial.

         

A
knowledgeable consultant can shorten the award decision to possibly 3
to 4 months. In addition, a consultant will make sure that all
deductible expenses are applied in order to maximize the award.
Finally, and most importantly, the consultant will provide guidance to
prevent denial of the claim.

         

The
secret for receiving a successful award for aid and attendance or
housebound ratings is not in filling out the form but in knowing what
documents and evidence must be submitted with the application.
Knowing the secrets for a successful award — with the special case of
long term care recipients — is 95% of the battle. Filling out and
filing a claim is a formality.

         

A
knowledgeable consultant can provide information to shorten VA’s
decision window of 6 to 12 months to possibly 3 or 4 months. The
consultant also understands how to maximize the benefit or avoid a
denial. The consultant can also provide guidance for meeting the asset
test. Finally, the consultant can provide the actual strategies for
transferring assets and he or she can arrange for trusts or income
conversions to allow for the best possible transfer of assets to
beneficiaries thus avoiding taxes, family disputes and Medicaid
penalties.

Professionals at the Morton Law Firm are knowledgeable about Veterans benefits and can assist families in qualifying for those benefits, as part of a comprehensive estate and asset protection plan.