New VA Aid and Attendance Eligibility Requirements go into Effect this Week
The Veterans Administration has announced changes to the eligibility requirements for Veterans to receive Aid and Attendance benefits.
The two most significant changes the VA has added is a gifting penalty and a 36-month look-back period for gifts an uncompensated transfers. These changes go in effect October 18, 2016
Overview of VA Aid and Attendance Benefits
Aid and Attendance is a Veterans program that pays up to $2,169 per month to an eligible veteran (or up to $1,178 per month to the widow of a veteran) who is in need of aid and attendance from a health care provider. This amount of money is an important income stream to be added to the veteran’s other incomes sources to allow them to receive care at home or other desirable setting.
Eligibility Requirements of VA Aid and Attendance Benefits
There are four main components for Aid and Attendance (A&A) eligibility:
First, the veteran (or widow) must be older than 65 and be in need of aid and attendance from another person. If the veteran can drive and/or take care of him/herself, then the veteran will not be eligible. It is allowable for the aid and attendance to be provided by a child as long as there is a written caregiver agreement between the parent and child.
Second, the veteran must have been discharged from the military other than dishonorably and served at least 90 days of active duty, with at least one of those days being during wartime.
Third, there is an income limitation. The veteran’s (and spouse’s) income minus unreimbursed medical expenses (like the cost of a caregiver) is subtracted from the A&A benefit to be received. If this net income exceeds the A&A benefits, then there is no benefit. However, the cost of the caregiver usually exceeds the veteran’s income.
Finally, there is an asset limit. The veteran (and spouse) is allowed to have $123,600 of countable assets plus annual income in excess of unreimbursed medical expenses (if any). Not all assets are “countable” towards this limit, such as a residence plus up to two acres of land around the residence, household furniture and a vehicle. This asset limit is tied to Medicaid’s Community Spouse Resource Allowance and will increase in the future in accordance with Medicaid.
Impact of New Eligibility Requirements
The VA’s new rules will impose a three-year look-back period for gifts and uncompensated transfers. This will limit the planning options for Veteran’s to maximize their benefits and preserve assets for their long-term care needs. The prior lack of a look-back period allowed wartime veterans the ability to leave property or some other assets to their children while still being able to get help to pay for home care or assisted living. The new rule mirrors a similar look-back period for Medicaid eligibility requirements.
In light of this three-year look back period, Veteran’s and their families are encouraged to meet with their estate planning attorney well before the need arises, so resources can be maximized for the benefit of the Veteran’s long term care.