The Veterans’ Pension, Aid and Attendance, and the Department of Human Services
A two part series by Anthony Marone, Esq. of McAndrews Law Offices, P.C.
The VA Pension provides monthly payments to veterans who are disabled or over the age of 65. This payment may provide crucial funds to be used for the care of a veteran in the community. However, when the same veteran applies for Medical Assistance Long-Term Care benefits to assist with his or her medical care, he or she will find that the money received from the Department of Veterans’ Affairs causes serious complexities for receipt of those benefits. Part I of this article explains how to qualify for the VA Pension and why the veteran’s receipt of pension income could disqualify him or her from receiving Medical Assistance Long-Term Care benefits. Part II examines how conserved, lump-sum or overpaid VA Pension income could run afoul of the Medical Assistance Program’s resource limits.
The VA Pension and the intractable income issue of Medical Assistance
What are the “VA Pension” and Aid and Attendance?
The VA Pension is a “needs-based” government benefit that provides a monthly cash payment to eligible veterans or their surviving dependents (“claimants”). To be eligible for the VA Pension, also known as the “Improved Pension,” a veteran of the United States Armed Forces must:
(1) have been discharged under other than dishonorable conditions;
(2) served 90 days or more of active duty with at least 1 day during a period of war;
(3) have countable income and net worth below established thresholds, and;
(4) either be permanently and totally disabled or age 65 or older.
The surviving spouse or unmarried child of a deceased veteran may also be eligible to receive the VA Pension, which is often called the “Death Pension.” To be eligible for the VA Pension, the surviving spouse or unmarried child must have countable income and net worth below established thresholds and the deceased veteran must have met the criteria under conditions (1) and (2), above. The amount of the monthly payments under the VA Pension varies based on the financial and medical need of the claimant.
The VA Pension benefits are designed to provide eligible claimants with a minimum level of financial security and are not intended to protect substantial assets or build up his or her estate for his or her heirs. Therefore, a claimant with a “net worth” in excess of $80,000.00 will likely not qualify for the VA Pension. Assuming the claimant’s net worth is less than the established limits for the VA Pension, the Department of Veterans’ Affairs (“VA”) will determine the amount of the benefit based on the claimant’s income, need, and expenses. If the claimant does qualify for the VA Pension, the claimant will receive a payment equal to the difference of his or her maximum annual pension rate (“MAPR”), which is a figure established by the VA, and his or her income for VA purposes (“IVAP”), minus expenses.
The calculation of the VA Pension amount will vary if the claimant is severely disabled. The VA provides for two “add-ons” to the amount of the VA Pension. The first add-on, “Aid and Attendance” (“A&A”), is for a claimant who establishes he or she is so helpless as to require the aid and attendance of another person. If a claimant has visual acuity of 5/200 or less, or is a patient in a nursing facility, or establishes a need based on the totality of the circumstances, he or she may be eligible for the payment of A&A. If the claimant cannot establish the need for A&A, he or she may qualify for “Housebound” benefits (“HB”), which pays a lesser rate than A&A. Eligibility for HB can be established if the claimant can show he or she is substantially confined to his or her home because of disabilities that are reasonably certain to continue throughout the claimant’s lifetime. The difference in the rates from the yearly basic pension amount to the amount for A&A is significant:
|Veteran Family Status||Basic Pension
|Aid & Attendance
|Veteran with no dependents||$12,907||$15,773||$21,531|
|Veteran with a spouse or child*||$16,902||$19,770||$25,525|
|Surviving spouse / death pension||$8,656*||$10,580||$13,836|
*Add $2,205 for each additional child
See, http://www.benefits.va.gov/PENSION/current_rates_veteran_pen.asp and http://www.benefits.va.gov/PENSION/current_rates_survivor_pen.asp for a full list of the VA Pension rates by each MAPR group for veterans and surviving dependents.
However, a claimant may require assistance from more than one needs-based benefit. Medical Assistance Long-Term Care benefits (“MA-LTC”), for example, are needs-based benefits that provide expansive medical care as well as nursing facility and in-home care. Eligibility is based on both medical need and strict income and resource limits. Many persons with disabilities and persons over the age of 65 rely on MA-LTC to provide for their medical care. Payments from the VA Pension may exceed the strict income and resource limits of the Medical Assistance program, possibly disqualifying the claimant.
Medical Assistance Long-Term Care and the VA Pension.
The VA Pension can provide much needed income to a veteran or his or her surviving dependents (referred to as “veterans” for the remainder of the article). It could also provide enough income or resources to disqualify a veteran for other needs-based benefits, such as MA-LTC. To qualify for MA-LTC, the veteran will normally need to have resources less than $8,000.00. This resource limit does not include the value of exempt resources such as the residence or one vehicle. The income limit for MA-LTC is based on gross monthly income. That amount cannot exceed $2,205.00 per month.
The VA Pension and the MA-LTC Income limit.
Initially, it is important to note that only the VA Pension portion of the monthly payment to the veteran is considered income for the purpose of eligibility for MA-LTC. The A&A and HB portion of a veteran’s benefit is not considered income. 55 Pa. Code § 181.81(9). However, when the VA awards benefits, it does not usually distinguish which portion of the payment is income and which portion is for HB benefits or A&A. The Department of Human Services (“DHS”) will attempt to verify which portion of a benefit to include as income by contacting the VA. See, Medical Assistance Long-Term Care Handbook, Chapter 450, Appendix B. If a single veteran with no dependents receives the maximum VA benefit of $1,794.00 per month, the Department will consider $719.00 as the excluded A&A portion. Id.
A veteran who is disabled or over age 65 may also receive income from both the VA Pension and from Social Security, in the form of Social Security Disability Income (“SSDI”) or Social Security Retirement. The combination of SSDI and the VA Pension income, for example, may exceed the strict income limit for the veterans’ MA-LTC eligibility. This is usually only an issue when the veteran remains in the community and attempts to qualify for the MA-LTC’s in-home care benefits, known as “Waiver” Services. If the veteran has gross monthly income of $1.00 in excess of the $2,205.00 income limit for MA-LTC, he or she will find it extremely difficult to access the Waiver Services.
The complexity of the MA-LTC income spend-down issue is beyond the scope of this article. Suffice it to say, the veteran in this situation cannot access Waiver benefits without doing a complex and draconian income spend-down each month he or she receives the Waiver benefits. The monthly spend-down would require spending all income, in excess of $735.00 per month (or $425.00 for a married veteran), on medical expenses. The veteran would have only $735.00 each month to pay for his or her food, shelter, and other living expenses. In other words, to access Waiver benefits to remain in the community, the veteran may need to spend his or her income down to an amount where he or she could not afford to live in the community. This issue does not apply to veterans who are receiving long-term care in a nursing facility.
When the veteran enters a nursing facility for long-term care, the maximum VA benefit he or she can receive is $90.00 per month if he or she receives Medical Assistance and has no spouse or dependent child in the community. The $90.00 is considered A&A by the Department and is not treated as income payable to the nursing facility to defray the veteran’s cost of care. See, Medical Assistance Long-Term Care Handbook, Chapter 450.3(1). However, while the $90.00 is not considered income in the month it is received, it will be considered a resource in the following months if it is not spent. Excess resources, just like excess income, can disqualify a veteran for MA-LTC.
Conclusion – Part I.
The VA Pension and the add-on HB and A&A benefits are crucially important to pay for the care of a veteran or a deceased veteran’s dependents. However, the VA Pension and MA-LTC are both needs-based government benefits with differing and conflicting eligibility criteria. An eligible veteran should always attempt to access the VA Pension and the add-on benefits but should also be aware of the potential complexity when he or she applies for the MA-LTC Waiver benefit. McAndrews Law Offices specializes in Elder law, Disability law and Veteran’s issues and is readily available to assist any veteran with these complex issues. For any questions, call 610-648-9300.