The Veterans Administration (V.A.) Pension program provides monthly benefit payments to certain Veterans and their survivors who demonstrate financial need. These VA programs are: Pension, Aid and Attendance (A&A) and Homebound.
The Aid and Attendance Pension gives benefits for veterans and surviving spouses who need the regular care of another individual to assist in routine daily personal care, including eating, bathing, dressing and undressing or bathroom assistance.
Eligibility for A&A extends to persons who are blind or individuals who are in a nursing home due to physical or mental incapacity. Persons who must reside in assisted living facilities also qualify for the assistance.
Qualifying for A&A
Eligible Veterans can receive an A&A pension as high as $1,732 per month. A surviving spouse is eligible for $1,113 per month and couples $2,054 per month. Veterans who seek A&A must be qualified by their physician that they need day-to-day assistance of another person to dress, undress, cook, eat, and remove prosthetics, run errands and other daily activities.
It is not necessary to require assistance in every area of one’s life. However, your doctor must provide sufficient medical evidence that you cannot carry out these functions on your own.
In recent months, the V.A. has come under intense pressure to reduce the backlog of more than 600,000 A&A disability claims, which can runs into delays of 8 to 18 months before Veterans receive an answer. According to the V.A., the reason for the backlog has to do with their efforts to discourage “pension poachers.”
Who are pension poachers?
Senator Ron Wyden (Democrat, Oregon) describes pension poachers as individuals who are “preying on veterans.” Financial and estate-planning professionals are “submitting thousands of claims” on the behalf of Veterans who are not eligible for A&A benefits.
According to a report released by the Government Accountability Office (GAO) these predators charge Veterans fees as high as $10,000 to for annuities and trusts that will hide assets and help Veterans meet the A&A eligibility requirements. Veterans can than qualify to receive money to pay assisted living expenses. In some cases, assisted living personnel referred Veterans to the pension poachers.
These poachers are not doing anything illegal, but are taking advantage of a loophole in the system that enables them to “hide” these assets up to the day before applying for A&A benefits. In contrast, to determine eligibility for Medicaid nursing home assistance, administrators “look back” 60 months for assets.
Scheme can work against Veterans
Unlike Medicaid and similar benefit programs, the V.A. does not have a policy that prohibits this practice. Senator Wyden and Senator Richard Burr (Republican, North Carolina) have introduced legislation that will eliminate this abuse and eventually the backlog.
In the meantime, the practice of transferring and hiding assets to qualify for A&A can go wrong. If the V.A. ends up denying the application, the Veteran may end up in a position where they cannot use their assets to provide for their living needs. In addition, many of these vets could fail to qualify for Medicaid to pay for their long-term care at a later date.
The GAO recommends that Veterans steer clear of financial professionals and others who advise you to put assets into annuities and trusts before applying for A&A or appealing a decision. Instead, review your income, expenses and assets to determine if you meet requirements for the pension.