The U.S. Department of Veterans Affairs has a little known tax-free pension available to help qualified veterans, spouses, and their surviving spouses to pay for home health care, assisted living, or nursing home care. The VA Aid & Attendance & Housebound Pension is designed to provide qualified veterans and their un-remarried surviving spouses with financial benefits outside of the traditional VA residential system. With a pension in hand, veterans are able to afford the care they need and are provided a choice.
Unfortunately, On January 23rd, 2015 the VA issued proposed regulations that may preclude a substantial amount of applicants from qualifying if they haven’t already planned ahead for this need. The majority of these rules pertain to Net Worth, Asset Transfer, and Income Restrictions, which may result in a large population of Veterans and their Surviving Spouses no longer qualifying for this benefit.
The VA’s stated policy is to “ensure that wartime veterans and their families receive the highest level of care possible while simultaneously being mindful of the interests of the taxpayers.” These proposed regulations, however, are not going to accomplish these goals for many reasons.
The proposed regulations will result in a Surviving Spouse incurring nearly twice the penalty as a Veteran would, and will prove to create a hardship for Veterans, Surviving Spouses, and Taxpayers alike. Veterans and Surviving Spouses who have not prepared for this change will be forced to make the decision of whether to pay for the care they need and risk depleting their assets or to delay paying for care and risk a slip and fall which may create a domino effect with their health care needs.
Sadly, millions of Veterans and Surviving Spouses will no longer have access to this benefit to help pay for their care. This change will inevitably result in the depletion of estates and the need for MediCal to pay for care needs as a last option, at a substantial cost to the taxpayers.
Unfortunately, no effective date for the implementation of these changes has been given as of yet and there is no language addressing a grandfather provision for pending claims. These proposed regulations are currently under scrutiny and therefore Veterans and their families can comment on these proposed regulations before March 24, 2015 by visiting www.regulations.gov and typing AO73 in the search box.
While there are no guarantees that these proposed regulations will be implemented, if you are a Veteran or a family member of a Veteran, you should contact an Accredited VA attorney to discuss how best to plan for these changes so you are prepared for what the future holds in regards to VA benefits.
Please note that this article is a general summary of law and omits many important details, footnotes, and caveats. It is no substitute for legal advice from a lawyer based on your particular circumstances.
For more information, call Gabriel Lenhart, your local Veteran’s Advocate and VA-Accredited Attorney, at (530) 268-5485, or email Gabriel@LenhartLawOffices.com.