Month: January 2015

What is the Aid and Attendance Pension Benefit?

Filing a claim can be time-consuming and complicated. It’s important to get help.
Applications for Pension that involve a rating, evidence of prospective, recurring medical expenses, appointments for VA powers of attorney and fiduciaries, and an understanding of the actual application process should not be attempted without prior knowledge. We recommend you purchase our book to avoid lengthy delays in a decision or possible denials of the claim. Not only does the book help you understand how to shorten the decision process from VA and ensure a successful claim but the support forms we provide also help you present medical evidence and costs in a format familiar to VA service representatives. Applications that also involve reallocation of assets in order to qualify should not be attempted without the help of a qualified veterans aid and attendance benefit consultant.  

Understanding VA Pension and VA Pension with Aid and Attendance
“Aid and attendance” is a commonly used term for a little-known veterans’ disability income. The official title of this benefit is “Pension.” The reason for using “aid and attendance” to refer to Pension is that many veterans or their single surviving spouses can become eligible if they have a regular need for the aid and attendance of a caregiver or if they are housebound. Evidence of this need for care must be certified by VA as a “rating.” With a rating, certain veterans or their surviving spouses can now qualify for Pension. Pension is also available to low income veteran households without a rating, but it is a lesser dollar amount.

For information on ratings please go to the article entitled “Who is eligible for the aid and attendance Pension benefit?”

Pension Is One of Two Disability Income Benefits from VA
The Department of Veterans Affairs offers two disability income benefits for veterans who served on active duty.

The first of these benefits — Pension — is the subject of this website and is discussed briefly in a section above. The purpose of this benefit is to provide supplemental income to disabled or older veterans who have a low income. Pension is for war veterans who have disabilities that are not connected to their active-duty service. If the veteran’s income exceeds the Pension amount, then there is no award. However, income can be adjusted for unreimbursed medical expenses, and this allows veterans with household incomes larger than the Pension amount to qualify for a monthly benefit. There is also an asset test to qualify for Pension.

The second disability income benefit is called “Compensation” and it is designed to award the veteran a certain amount of monthly income to compensate for potential loss of income in the private sector due to a disability or injury or illness incurred in the service. In order to receive Compensation, a veteran has to have evidence of a service-connected disability. Most veterans who are receiving this benefit were awarded an amount based on a percentage of disability shortly after they left the service. There is generally no income or asset test for most forms of Compensation, and the benefit is nontaxable.

Some veterans may have record of being exposed to extreme cold, having an inservice, nondisabling injury, having tropical diseases or tuberculosis or other incidents or exposures that at the time may not have caused any disability but years later have resulted in medical problems. Most elderly veterans who never applied for compensation, may not realize they can apply many years after leaving the service. In fact, VA recognizes this issue and in 2006 conducted an outreach program to these veterans in five selected states with low elderly Compensation enrollment and ended up adding an additional 8,000 beneficiaries to the roles.

Some veterans may be receiving Compensation but their condition has worsened. They can reapply and get a larger amount based on a higher disability rating. In fact, in 2007, VA expects twice as many cases of existing compensation to be reopened for new consideration as new first-time claims. In 2007, VA anticipates 216,000 new claims for Compensation but will receive 448,000 claims for reconsideration of existing Compensation benefits.

Compensation and Pension claims are submitted on the same form and VA will consider paying either benefit. If a claimant is awarded both benefits, the claimant can only receive one of them. Generally, for applications associated with the cost of home care, assisted living or nursing home care, the Pension benefit results in more income.

Of the two benefits, Compensation provides 10 times more total income and covers 6 times more beneficiaries than Pension. In 2007, Compensation will pay 3,116,728 beneficiaries a total of $34,750,690,000 and Pension will pay 523,824 beneficiaries a total of $3,671,997,000.

Compensation is a rapidly growing program and VA estimates that approximately 35% of all veterans leaving the service will eventually submit a claim for Compensation benefits. Compensation is already a major government entitlement program and currently chews up 45% of the entire VA budget. In years to come, it will continue to become a larger proportion of the Veterans Affairs and federal budget.

We will devote little mention of Compensation benefits on this site. The application process is fairly clear and requires no additional knowledge to submit a claim. The balance of this site will be devoted almost exclusively to Pension since Pension fits very nicely with long term care costs.

There are also several death benefit variations of the two disability incomes for single surviving spouses or dependent minor children or adult dependent children. We will not discuss the death benefits related to service-connected disability but instead will discuss on this site only the Death Pension benefit.

Pension for Veterans with Low Income, Little Savings and Few Investments
Although the Veterans Administration does not differentiate between various Pension applicants, there are, in practice, two kinds of Pension applications. The first type of application or claim, as it’s called by VA, deals with veteran households that do not generally require the rating mentioned above in order to receive a benefit or as VA calls it, an award. These applicants will have household income less than the monthly allowable Pension rate. In addition, they will have very little in savings or investments. And, with no ratings, the size of their Pension awards will be much smaller.

It is our opinion that most veterans or their surviving spouses, receiving Pension, are in this category. We believe this is true for several reasons. One reason is that Veterans Service Representatives in the local regional office, who deal with the public, will tell callers that Pension is only available to veteran households with low income. VSR’s turn away a lot of potential applicants. This is probably because these employees are not trained sufficiently to understand the special case of veterans with higher income and high long term care costs. A second reason is that callers will be told — if they have significant savings or investments — they will not qualify as well. It is possible to give away assets in order to qualify for Pension. Naturally, Veterans Service Representatives will not mention this as an option. A third reason is that veterans with higher income and significant assets generally don’t know they can qualify for Pension under certain conditions. No one has ever told them. As a result, they never apply. A compelling fourth reason is that most people don’t know the aid and attendance Pension benefit (includes A&A allowance) can help cover home care costs paid to any person or professional providers. Most people don’t attempt to apply until they have become single and enter a nursing home where VA refuses to pay the benefit if the single claimant is eligible for Medicaid.

The table below, labeled “Exhibit 3.3,” is from a study conducted for VA to determine how many veterans might apply for Pension in coming years. The subjects of this report are most likely veterans with low household income and few assets. This group would be included because it is easy to research their demographics in government statistical reports. Those veteran households with higher income and high long term care costs would not show up in this report because it is difficult to predict how many veteran households will actually need long term care and what those costs might be.

It is apparent from the report that only about 28% of the eligible veteran households will actually apply for and receive Pension over the next seven years. It also appears from the study, that even for those households where Pension naturally fits, VA is not doing a good job of educating potential beneficiaries about this benefit or more would be applying.

In fact, the 2008 federal operating budget projected by Veterans Affairs shows a decline in the number of people applying for Pension; whereas, based on the table below, the program should be serving more than 3 1/2 times as many people as it does now.

VA wants to get the word out and in January of 2007, VA Secretary Jim Nicholson issued a news release that was carried by many major papers about this benefit. State Veterans Affairs departments also want the public to know about Pension, but lacking advertising budgets, they are not very effective at letting people know.

The table below does not reflect the number of surviving spouses of eligible veterans or their dependent children who are also eligible for a lesser Pension benefit called “Death Pension.” In 2005, approximately 207,000 of these eligible beneficiaries were also receiving Death Pension payments from VA, in addition to the 331,000 estimated living veteran beneficiaries. Since the 2005 numbers are now available, the actual number of living veteran beneficiaries in 2005, receiving Pension, was 336,000.

The following was taken from a survey by ORC Macro Economic Systems Inc., Hay Group, December 22, 2004 called “VA Pension Program Final Report” http://www1.va.gov/op3/docs/Pension.pdf

Pension for Veterans Who Require a Rating for “Aid And Attendance” or “Housebound” in Order to Receive an Award
This is the second type of VA application generally submitted for a claim. Claimants in this category often have income above the maximum Pension rate and they may also have significant savings or investments. Typically, this category of application requires a potential beneficiary to be paying for ongoing and expensive long term care or other medical costs.

For veteran households receiving expensive long term care services and whose incomes exceed maximum Pension rates, a rating is almost always necessary in order to receive a benefit. In most cases, without a rating, there is no benefit.

Because we believe the study above does not include an estimate for individuals requiring future VA disability ratings, we offer evidence that there is a significantly larger category of potential Pension beneficiaries. This group of eligible veterans or their survivors is about 10 times larger than the one million or so anticipated eligible beneficiaries covered by the study and expected to be awarded over the next seven years. On the other hand, this larger group of roughly 10 million Pension beneficiaries can only receive an award under certain special conditions and typically only if they receive a rating.

Receipt of a Pension benefit for this larger group is generally dependent upon whether these people have a need for long term care services. But, based on the incidence of long term care in an older population, at least 60% to 80% of this larger group might have a good chance of qualifying for Pension sometime during their remaining years.

For an explanation of the special annualized treatment of unreimbursed long term care costs and insurance premiums please go to the article entitled “Understanding the special case of long term care medical costs.”

The table below examines this sizable group of potential beneficiaries and also compares them to the smaller group in “Exhibit 3.3” above. Estimates of the number of survivor beneficiaries in the table below were based on the percentage of that group actually receiving benefits over the number of living veterans actually receiving the benefit. Data for this table were taken from the 2007 Statistical Abstract of the United States for the most recent years of 2005.

What is surprising about these numbers is that a third of all people — 33% — in this country, over the age of 65, have a potential for receiving a Pension benefit.That’s how many war veterans or their survivors there are in the US.

The potential for receiving a benefit is huge. But, in actuality, only 4.7% of this large population of potential beneficiaries is actually receiving a benefit. This is truly astounding and appalling! We are working to educate both veterans AND their families so many more will begin to receive this hard earned benefit!

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The Appeal of Living in a State Veterans Home

State veterans homes fill an important need for veterans with low income and veterans who desire to spend their last years with “comrades” from former active-duty. The predominant service offered is nursing home care. VA nursing homes must be licensed for their particular state and conform to skilled or intermediate nursing services offered in private sector nursing homes in that state. State homes may also offer assisted living or domiciliary care which is a form of supported independent living.

Every state has at least one veterans home and some states like Oklahoma have six or seven of them. There is a great demand for the services of these homes but lack of federal and state funding has created a backlog of well over 130 homes that are waiting to be built.

Unlike private sector nursing homes where the family can walk in the front door and possibly that same day make arrangements for a bed for their loved one, state veterans homes have an application process that could take a number of weeks or months. Many state homes have waiting lists especially for their Alzheimer’s long term care units.

No facilities are entirely free to any veteran with an income. The veteran must pay his or her share of the cost. In some state the veterans contribution rates are set and if there’s not enough income the family may have to make up the difference. Federal legislation, effective 2007, also allows the federal government to substantially subsidize the cost of veterans with service-connected disabilities in state veterans homes.

THE APPEAL OF LIVING IN A STATE VETERANS HOME

We believe most veterans or their families seek out residency in a state veterans nursing home because they believe this service is one more VA entitlement that should be available to them. But there is also a similar entitlement available to anyone in most private sector nursing homes–facilities that may be geographically closer to the family than the nearest veterans home. This is Medicaid. Veterans seeking long term care from VA programs generally don’t have the funds for private pay in a people in a private sector Medicaid certified facility. Most families who are seeking help for their loved ones, who are veterans, generally look to VA first before considering Medicaid. Or they are simply not aware of Medicaid. In many cases, Medicaid may be the better choice.

Aside from seeking long term care because of an expectation of entitlement are there any other reasons that veterans would prefer a state home? We ask this question of ourselves because we have noticed that in some states veterans homes are in distant rural areas. The fact that some of these homes are hundreds of miles from urban areas where the majority of veterans would tend to live, made us wonder why some veterans would move long distances to reside in these facilities.

To answer this question we contacted a number of rural state veterans homes on the phone and asked them why a veteran or his or her family would seek out their services as opposed to seeking services in a closer non-veterans facility under Medicaid. Almost unanimously the answer we got was that some veterans like the idea of sharing their living arrangement with other veterans. The facilities almost always referred to this as “camaraderie”– a band of brothers.

Statistically, private sector nursing homes are mostly populated by older women who are generally in poor health. Some men may not feel comfortable in an environment where the activities and the social atmosphere are centered on women. In contrast, veterans homes are almost exclusively populated by men. In addition, based on our observation, we suspect the population of state homes is younger and healthier than that of private sector facilities.

These demographics would suggest that activities and social atmosphere revolve around the needs of men not women. A younger, healthier population would also suggest veterans homes would offer more opportunity in the form of transportation or scheduled outings for the residents to be out in the community. One veterans home reported to us that they regularly scheduled fishing trips and outings to sporting events for their residents. These would be unheard of activities for the typical private nursing home.

The second most common reason reported to us why veterans seek out state homes is for financial reasons. In many states the cost of the home is subsidized for veterans who meet an income test. The vet’s income is considered sufficient to cover the cost. These veterans may own a home or other assets that they wish to protect from Medicaid and leave tot their family. The state veterans home will allow them to give these assets to the family without penalty. Medicaid would require a spend down of those assets or impose a penalty for gifting.

Another reason related to finances may be there are no available Medicaid beds in the veteran’s area. The veteran may be paying out of pocket ofr a nursing facility but have his name on a waiting list for a State Home where the out-of-pocket cost would be much less. When his name comes up he will move to the State home.

A financial incentive for the veteran is that all state veterans homes will apply for the pension benefit for those residents who are eligible. Federal law prohibits VA from paying any more than $90 a month to single veterans who are eligible for Medicaid in a non-veteran nursing home. State veterans homes are exempt from this rule and the single veteran can keep the entire pension amount although most of it will have to apply to the cost of care. For those state veterans homes that also accept Medicaid, pension represents additional disposable income.

Medicaid is not allowed to apply the aid and attendance allowance from pension towards the cost of care but must let the veteran retain that money. The fortunate veteran who has this additional #300-$500 a month can use this money for additional personal needs. One veterans home that has this dual arrangement with Medicaid and Va pension reports that the veterans receiving this benefit, pool the money with other veterans in the facility and it helps pay for dinner tickets, theatre tickets, expensive outings and other amenities that would not normally be available to private sector nursing home residents.

PER DIEM RATES

The Veterans Administration pays the state veterans homes an annually adjusted rate per day for each veteran in the home. This is called the per diem. In most states the per diem falls we short of this goal.

The per diem program and construction subsidies mean that State veterans homes can charge less money for their services than private facilities. Some states have a set rate, as an example, $1400/mo, and they may be relying on the pension benefit with aid and attendance plus the per diem to cover their actual costs. Other states may charge a percentage of the veterans income but be relying on other subsidies to cover the rest of the cost.

Most of the states with income-determined rates are selective about the veterans they accept. These states may rely on a variety of private and public sources to help fund the cost of care.

States without set rate subsidies may charge 50% to 70% of the rate of private facilities based on private or semi private room occupancy and if the veteran does not have enough income, these homes accept Medicaid or Medicare to make up the difference. In these state the veterans homes are Medicaid and possibly Medicare certified.

SERVICE AVAILABLE

Some state facilities offer assisted living or domiciliary care in addition to nursing care. Some states even build facilities devoted entirely for domiciliary. According to the Veterans Administration the definition of domiciliary care is as follows: “To provide the least intensive level of VA inpatient care for ambulatory veterans disabled by age or illness who are not in need of more acute hospitalization and who do not need the skilled nursing services provided in nursing homes. To rehabilitate the veteran in anticipation of his/her return to the community in a self-sustaining and independent or semi-independent living situation, or to assist the veteran to reach his/her optimal level of functioning in a protective environment.”

A domiciliary is a living arrangement similar to assisted living without substantial assistance, but is not intended as a permanent residence. Domiciliary rooms in veterans medical centers are designed around this concept and are used for rehabilitation recovery from surgery or accident, alcohol abuse, drug abuse, mental illness or depression.

The domiciliary concept does not work well in a state veterans home setting and in the context domiciliary is simply another name for assisted living without the  assistance. This represents a form of independent retirement living with a little more support where the veteran can stay as long as he or she needs to. A far as state veterans homes go you should think of domiciliary as a substitute for supported independent living retirement.

Many state veterans facilities have set aside a wing for Alzheimer’s patients. In some states this is the most popular service sought by veterans or their families and waiting lists could require a number of years before a bed opens up. A small number of facilities offer adult day care.

 

Using Aid and Attendance to Pay for a Nursing Home

This informative article will help you better understand how Aid an Attendance can help you cover the costs of a nursing home.

Using Aid and Attendance to Pay for a Nursing Home.