Earlier this year the Department of Veterans Affairs (VA) introduced proposed regulations relating to the Aid and Attendance program. These proposed regulations are a substantial modification to current VA policy and the consequences will be far-reaching, placing additional barriers between wartime veterans and the benefits they have earned.
The proposed VA regulations are designed to bring the Aid and Attendance program more in line with current policy and regulations relating to Medicaid. The regulations propose a 3-year look-back, the imposition of a penalty period of up to 10 years for sanctioned transfers, the creation of bright-line net worth standard for income and assets, the denial of expenses accrued at an independent living facility, and a prohibition on a veteran holding property exceeding two acres.
WHAT IS AID AND ATTENDANCE?
The Aid and Attendance program is a needs-based benefits program offered to veterans who require the assistance of another person in order to perform activities of daily living. In order to qualify a veteran must require the support mentioned above, have served 90 days or more of active military service with at least one day during a wartime period, and must have received a military discharge other than dishonorable.
The Aid and Attendance Program is designed to assist veterans and survivors in helping offset unreimbursed medical expenses. Aid and Attendance is also means-based, meaning that each qualifying veteran must meet certain income and asset restrictions in order to qualify for the dispersal of the full award amount. To qualify, the veteran must meet both income and asset inquiries.
Under current VA regulations, a veteran’s qualified medical expenses are subtracted from the veteran’s monthly income. This figure was then subtracted from the maximum monthly benefit to provide the veteran with his or her Aid and Attendance Award. If a veterans qualified medical expenses were more than his or her income, then the Veteran would qualify for the full Aid and Attendance Award.
VA regulations relating to the Aid and Attendance program do not currently have a bona fide asset limit. Most practitioners are hesitant to apply for Aid and Attendance benefits if the veteran has assets above $30,000, but because the VA did not draw a line in the side in terms of an asset limit, some applications were approved with substantially more than the $30,000.
Summary of Proposed Changes in VA Policy
3 YEAR LOOK BACK
VA does not currently have a look-back period in connection with asset transfer. A 'look-back' period is the time in which a governmental agency like the VA can investigate transfers of assets in determining your eligibility for benefits. The longer the look-back, the more onerous the application process. The VA proposes to implement a look-back period of three years. Absent clear and convincing evidence, VA presumes that asset transfers made during the look-back period were made to establish VA entitlement.
In connection with the assessment of a 3-year look-back, the VA would impose a penalty period for transfers in violation of the look-back. The penalty period would be calculated based on the total assets transferred during the look-back period to the extent they would have made net worth excessive of the asset limit. The penalty period would begin the first day of the month that follows the last asset transfer.
NET WORTH STANDARD
VA does not currently have a bona fide net worth limit. The proposed VA regulations implement the same maximum community spouse resource allowance figure utilized in Medicaid rules. This figure, $119,220 in 2015 and adjusted for inflation every year, is the “net worth” of the veteran and provides the maximum allowable dollar amount a veteran is able to maintain while still being eligible for the Aid and Attendance benefit. A claimant’s net worth will be determined by adding annual income to his or her non-excludable assets.
VA does not currently have a restriction on the amount of acreage a claimant may exclude from asset calculation. The proposed VA regulation still allows a veteran to exclude his or her primary residence from net worth, but imposes a restriction upon acreage surrounding the residence. A veteran may only exclude a “reasonable amount of land.” The rest is subject to be calculated under the new Net Worth Standard.
Major changes are afoot in the realm of Veterans Affairs Aid and Assistance benefits. The proposed VA regulations were instrumented after repeated failed attempts by the United States Congress to enact similar legislation. Because the VA itself is the genesis of these proposed rule changes, it is more likely than not that they will result in valid administrative law by the end of the calendar year. It is incumbent on all those associated with the application of VA benefits to become aware of such revisions. And for veterans to move quickly in applying for benefits before the landscape changes drastically.
*While this blog post was written by an attorney, the content is for informational purposes only and does not create an attorney-client relationship and is not intended to be an avenue for legal advice*