Helping Veterans Pay for Long-Term Care
March 1st, 2023
There are currently over eighteen million veterans living in the United States and approximately one-half are age sixty-five or older. Many of these veterans and their surviving spouses are receiving long-term care or will need some type of long-term care in the near future.
There are funds available from the Department of Veterans Affairs (“VA”) to help pay for these expensive long-term care services. Unfortunately, many of those who are eligible have no idea that any type of benefits exist for them or that an attorney can help them become eligible for those benefits.
VA Benefits in Nursing Homes
Veterans who have a service-connected disability rating of 70% or higher can receive free care in nursing homes operated by the VA. In Maine, the only VA-operated nursing home is Togus, located in Augusta. There are also a limited number of community nursing homes that have contracts with the VA whereby a veteran with a 70% disability rating can receive free care.
In conjunction with the states, the VA has built and supported state veterans homes, including the Maine Veterans’ Homes in Bangor, Augusta, Machias, Caribou, Scarborough, and South Paris. State veterans homes are not free, but there is a subsidy of $127.17 a day (as of October 2022) for nursing home care for each veteran, which reduces the expense. Most of these facilities offer nursing home care, and some offer assisted living and day care. They are generally available to any veteran and sometimes to spouses of veterans and gold star parents.
The VA provides a monthly benefit to veterans with at least a 10% disability rating that is the result of a disease or injury incurred or aggravated during active military service. The disability can be a physical condition or mental health condition such as post-traumatic stress disorder. The benefit amount increases according to the degree of the veteran’s disability and the number of dependents.
To be eligible for disability compensation, the veteran must: have served in the Uniformed Services on active duty, active duty for training, or inactive duty training; have been discharged under other than dishonorable conditions; and have at least a 10% disability rating by an injury or disease that was incurred in or aggravated during service. There is no length of service, income, or asset requirement.
Improved Pension Benefits
There are also three types of benefits available that provide a monthly cash payment to veterans who have long-term health care and financial needs: basic service pension, pension with housebound allowance, and pension with aid and attendance.
Basic Pension. The VA provides a basic pension to veterans and surviving spouses that meet the below service and financial eligibility requirements.
Housebound Allowance. A slightly higher monthly payment is available to wartime veterans or surviving spouses who meet the same service requirements as the basic service pension, but who are confined to their homes for medical reasons. The VA defines housebound as being substantially confined to the home or immediate premises due to a disability that will likely remain throughout the claimant’s lifetime.
Aid and Attendance. The highest monthly benefit is available when a wartime veteran or surviving spouse can show, through medical evidence provided by a primary care physician or facility, that the claimant requires the aid and attendance of another person to perform activities of daily living. The VA defines the need for aid and attendance as: requiring the aid of another person to perform at least two activities of daily living, such as eating, bathing, dressing, or undressing; being blind or nearly blind; or being a patient in a nursing home. This benefit, often referred to simply as “Aid and Attendance,” is the most widely known and talked-about benefit as it offers the highest possible monthly payment.
These improved pension benefits are available whether or not there was a service-connected disability, but the following criteria must be met:
- The veteran must have been discharged under other than dishonorable conditions.
- The veteran must have served ninety days of active duty with at least one day beginning or ending during a period of war. After September 1, 1980, the active duty requirement increased to 180 days.
- The claimant (either the veteran or the surviving spouse applying for the benefit) must be permanently and totally disabled, or age sixty-five or older. Permanent and total disability includes a claimant who is:
- In a nursing home or assisted living facility,
- Determined disabled by the Social Security Administration,
- Unemployable and reasonably certain to continue so throughout life, or
- Suffering from a disability that makes it impossible for the average person to stay gainfully employed.
To receive an improved pension benefit, the claimant must also meet certain financial requirements. The VA published a comprehensive set of rules governing the financial requirements for the improved pension benefit, which became effective on October 18, 2018.
A veteran or surviving spouse must have an Income for VA Purposes (IVAP) that is less than the benefit for which he or she is applying. IVAP is a claimant’s gross income from all sources, less countable medical expenses—that is, recurring, out-of-pocket medical expenses that can be expected to continue. If the claimant’s IVAP is equal to or greater than the annual benefit amount, the veteran or surviving spouse is not eligible for benefits.
Unreimbursed medical expenses will reduce a claimant’s income dollar-for-dollar after a small copay (5% of the annual pension amount) is met. But to be eligible for a special monthly pension for being housebound, the claimant’s IVAP must be less than the annual income threshold.
- Net Worth
As of October 18, 2018, the VA implemented a net worth limit. The net worth limit is $150,538 as of December 1, 2022. The net worth limit is the same regardless of whether the veteran is married. Net worth includes countable annual income plus countable assets. The primary residence (including two acres), a vehicle, and household goods are not countable assets.
- Lookback and Transfer Penalty
The VA also implemented an asset look-back rule on October 18, 2018. When a veteran applies for pension benefits, the VA will “look back” three years and penalize uncompensated transfers that occurred during that time. This transfer penalty can be as long as five years. However, transfers made prior to October 18, 2018 do not violate this new look-back rule. Additionally, if the applicant transferred assets but never had a net worth in excess of $150,538, those transfers do not violate the look-back rule.
The Application Process
While the application process for pension benefits can be agonizingly slow—some applications take over a year before the VA makes a decision—the benefit is retroactive to the month after submission of the application. Having the proper documentation in place at the time of application (for example, discharge papers, medical evidence, proof of medical expenses, death certificate, marriage certificate, and a properly completed application) can reduce the processing time.
Time is of the essence for veterans or surviving spouses who may be eligible for VA benefits. It is imperative for those who work with veterans or surviving spouses of veterans to be aware of these benefits and to help potential claimants obtain legal help to qualify for pension benefits. You should consult an elder law attorney to determine what benefits best meets your needs and concerns and how qualifying for benefits will impact your other long-term care planning objectives.
This article is intended to provide information of a general nature only. It does not provide or replace professional legal advice, and it does not establish an attorney-client relationship with the Maine Elder Law Firm. Please consult an attorney for advice regarding your specific circumstances.