By Cheryl Chapman Henderson, Attorney and Counselor at Law
Mrs. Evans suffers from debilitating arthritis and lives in an assisted living community. She was in danger of having to move from the community she calls home because she had depleted her savings, and her income alone was not enough to cover her living expenses.
Tom Barker, who at 89 lives independently in his home, needed in-home health services because of a heart condition. He did not have enough income to afford these services and was concerned that he might ultimately have to go to a nursing home.
Mary Mills quit her high-level job to care for her elderly parents. As painful as it was for her parents to depend on their daughter for care, it was even more painful to them that they could not help ease the financial burden that she had undertaken.
Today, Mrs. Evans remains in the assisted living community she calls home thanks to $1,056 in additional income she receives every month. Tom Barker continues to live independently now that he receives an additional $1,644 per month that pays for in-home health services. Mary’s parents are delighted that they can pay Mary at least $2,000 a month to ease the financial toll.
Where did this money come from? From a little known and underused benefit called VA Aid and Attendance. Mrs. Evans is the widow of a Korean War veteran. Both Tom and Mary’s fathers served in World War II. They were each able to qualify for the benefit. Not only did they receive the monthly income – TAX FREE, but the veterans were eligible for certain VA services such as free pharmacy services, home-based primary care, contract home health care, adult day health care, homemaker services, respite care and home hospice care and home rehabilitation grant of $1,200. Access to home healthcare and short-term community residential care is also available, which may be subject to charge.
The VA Aid and Attendance benefit has been around for years, but few people know about it and those who did know, didn’t know how to apply for it.
So who can apply? A veteran or a veteran’s single surviving spouse can apply. For ease of use, both are referred to as “claimants.” There are essentially four requirements for a claimant to qualify:
1. The veteran must have served at least one day in the military during World War II, Korean War, Vietnam War, and the Gulf Wars. The veteran does not have to have served in a combat zone. The veteran must have been on active duty at least 90 days; and after 1980, at least 24 months. The veteran cannot have been dishonorably discharged.
2. The claimant must have a medical condition that requires assistance or supervision. Mrs. Evans has difficulty walking and bathing without assistance. Tom Barker needs assistance with meals, medication, bill paying and house cleaning. Mary’s father suffers with dementia and needs supervision. They all qualify medically for aid and attendance. (If the claimant were 65 or younger, there must proof that he or she was totally and permanently disabled.)
3. The claimant cannot have more household income for VA purposes than the maximum benefit amount that he or she qualified for. Mrs. Evans, for example, has a gross monthly income of $2,500. As a surviving spouse, her maximum benefit amount is $1,056. Ostensibly she does not qualify; however, VA allows her to deduct from her income her assisted living expenses of $3,500 a month. Because her expenses exceed her income, her income is zero for VA purposes, and she therefore qualifies.
There are times when the claimant has to do some pre-planning to qualify for the benefit. Mary’s parents, for example, were not paying for their care. Mary was providing her services for free. Since they did not have significant expenses to offset income, they were not eligible to qualify. However, once Mary and her parents agreed to pay Mary using a special care agreement that her parents’ estate planning attorney prepared, Mary’s father was easily able to qualify for the benefit.
4. The claimant cannot have too much net worth. The residence, reasonable household contents, and a car do not count in determining net worth. So what is too much? There is no fixed amount, and decisions are made on a case-by-case basis. However, it is generally considered that the net worth should be well below $80,000.
So what if there is too much net worth? Here again, pre-planning can allow the claimant to qualify for the much deserved benefit. That’s what Tom Barker did. He had far more than $80,000 in net worth. But because he went to see a knowledgeable estate planning and VA accredited attorney, he was able to reduce his net worth to enable him to qualify.
A few words of caution: No one should take steps to reduce income or net worth without consulting a knowledgeable estate planning and VA accredited attorney. With proper planning, the veteran or surviving spouse can qualify for the benefit while preserving assets, independence and peace of mind.
Lastly, timing is critical. If you or someone you know may qualify for the VA Aid and Attendance benefit, once all of the necessary information is gathered, apply as soon as possible. Every month of delay is a month of benefit loss that can never be recovered!
For more about the VA Aid and Attendance benefit, please contact Cheryl Chapman Henderson, at (202) 276-2862, or visit her website. She is an experienced Estate Planning and Elder Law Attorney and an Accredited Attorney for the Department of Veteran’s Affairs.
© Cheryl Chapman Henderson 2011