Exploring Veterans Pension Benefits - Veterans Pension, Aid & Attendance or Homebound Pensions

Over the last week, I've been exploring several eldercare options for my parents.  For 92 & 82, they are doing pretty well, but their abilities are decreasing and daily living is becoming more challenging.

They don't have long-term care insurance, and their retirement income from Social Security and my father's union pension is on the border of being eligible for some programs and not eligible for others.

In researching and visiting various area Assisted Living Facilities, I discovered that their income simply won't cover the monthly costs of those types of non-medical, private-pay communities.  Also, Medicare covers only medical necessities and not personal care of the type provided by Assisted Living Facilities and Home Care Aides and agencies. 

However, while delving into the costs of Assisted Living, I discovered some options that help families increase their income to cover those costs OR increase their income to be able to afford in-home care.

I have found the website PayingForSeniorCare.com to be an excellent resource.  That website offers descriptions and comparisons of the many senior care options in addition to providing guidance on myriad financial options including a comprehensive list of state-by-state programs.

Their page "Financial Aid & Care Resources For Long Term Senior Care" provides well over 100 links to additional information pages including eligibility and benefits for the various programs.  The information can seem overwhelming, but it also provides hope because there are so many possibilities that most people don't know about.

Certainly, I can't cover all of the options, but I'll cover a couple of them that apply in my parents' situation and may apply to several others.  In this post, I'll cover Veterans Pensions and in another post I'll cover LifeCare Funding, the conversion of life insurance policies to help pay for senior care.

Veterans & Survivors Pensions

The Veterans Administration (VA) offers pension benefits to "wartime" veterans and surviving spouses of "wartime" veterans that have financial needs.

These pensions are tax free and have no effect on Social Security earnings limitations.  They are also lifetime benefits as long as the conditions at the time of application continue.  The VA used to require an annual Eligibility Verification Report that was burdensome for elderly Veterans and their families, but that was eliminated in December 2012.  Now they acquire IRS and Social Security data to confirm the continued eligibility for the benefits.

Many vets are unaware of these benefits and only a fraction of those eligible ever apply.  The VA, according to just about every resource I've read, has done a terrible job of educating veterans about these benefits.  Also, many that inquire about these benefits are turned away or not properly counseled by local VA reps due to lack of knowledge or training.

We'll discuss surviving spouses later.  For now, we'll concentrate on the Veterans Pensions.  There are three designations of Veterans Pensions:

• Veterans Pension
• Aid & Attendance benefit
• Housebound benefit

Let's look at those three designations one by one including eligibility requirements and benefits. Most of the information below comes directly from the VA Website.

Veterans Pension

Eligibility (http://benefits.va.gov/PENSION/vetpen.asp)

Eligibility is important, because the Veteran must be eligible for this pension to be eligible for the other two benefits.

Minimum Service Requirements

• At least 90 days of active duty with at least one day of service during a wartime period (for those in service prior to September 7, 1980)
• At least 24 months OR the full tour of service for which you were called to duty with at least one day of service during a wartime period (for those entering active duty after September 7, 1980)
• Discharged from service under "other than dishonorable" conditions

 

Under current law, VA recognizes the following wartime periods to determine eligibility for VA Pension benefits: 

• World War I (April 6, 1917 – November 11, 1918)
• World War II (December 7, 1941 – December 31, 1946)
• Korean conflict (June 27, 1950 – January 31, 1955)
• Vietnam era (February 28, 1961 – May 7, 1975 for Veterans who served in the Republic of Vietnam during that period; otherwise August 5, 1964 – May 7, 1975)
• Gulf War (August 2, 1990 – through a future date to be set by law or Presidential Proclamation)

My Dad didn't serve long, but he was drafted in 1941 and served half of 1942 making him eligible as far as minimum service requirements.  Of course, those requirements will eliminate several veterans from Pension benefits, but I'm guessing many of our readers have parents that served during those periods.

In addition to meeting minimum service requirements, the Veteran must be:

• Age 65 or older, OR
• Totally and permanently disabled, OR
• A patient in a nursing home receiving skilled nursing care, OR
• Receiving Social Security Disability Insurance, OR
• Receiving Supplemental Security Income

Finally, there are income and net worth limitations.  

Income and Net Worth Limitations (http://benefits.va.gov/PENSION/pencalc.asp)

Countable income includes income from most sources as well as from any eligible dependents. It generally includes earnings, disability and retirement payments, interest and dividend payments from annuities, and net income from farming or a business. Some expenses, such as unreimbursed medical expenses, may reduce your countable income.

That last sentence is very important.  Those medical expenses may be the difference between qualifying and not. 

The Maximum Annual Pension Rates (MAPR) set by Congress also serve as the income limits.  For 2014, the MAPR for the basic Veterans Pension are:

• $12,652 - Veteran with no spouse or dependent children
• $16,569 - Veteran with one dependent (spouse or child)
• $16,569 - Two Veterans married to each other

However, Veterans with higher income levels may still qualify if they have significant unreimbursed medical expenses (medical expenses not reimbursed by Medicare or a private insurance plan).  You can deduct unreimbursed medical expenses that exceed 5% of the applicable MAPR to arrive at "countable income".

Calculation Example #1:

Veteran has no dependents and receives $10,000 per year in Social Security, the only income source.  The Veteran would be entitled to a Veterans Pension of $2,652 ($12,652 - $10,000) or $221 per month.

Calculation Example #2:

Now, let's assume the Veteran has unreimbursed medical expenses.  Unreimbursed medical expenses (those paid out of pocket by the veteran) that exceed 5% of the MAPR may be deducted from "countable income".

Veteran has no dependents and receives $10,000 per year in Social Security, the only income source.  However, the Veteran also has $8,000 per year in medical expenses.  Insurance pays for $6,000 but the Veteran has to pay $2,000 out of pocket (unreimbursed medical expenses).  The Veteran must have at least $632 in unreimbursed medical expenses (MAPR of $12,652 X 5%) for them to be deductible   The Veteran can deduct $1,368 ($2,000 - $632) from the income to arrive at $8,632 "countable income".  The Veteran would then be entitled to a Veterans Pension of $4,020 ($12,652 - $8,632) or $335 per month.

Calculation Example #3:

Veteran is married and the combined income of both is $18,000 (above the MAPR limit of $16,569).  However, they have $5,000 of unreimbursed medical expenses.  They must have at least $828 in unreimbursed medical expenses (MAPR of $16,569 X 5%) for them to be deductible.  They can deduct $4,172 ($5,000 - $828) from their income to arrive at $13,828 "countable income".  The Veteran would be entitled to a Veterans Pension of $2,741 ($16,569 - $13,828) or $228 per month. 

 

Now to discuss the Net Worth limitation.  Although the Veteran may have limited income that would qualify, having significant assets that can be converted into funds to pay for costs of living might disqualify the Veteran from Pension benefits.   

Net worth includes assets such as bank accounts, stocks, bonds, mutual funds, annuities, and any property other than your residence and a reasonable lot area. You should report all of your net worth. VA will determine whether your assets are of a sufficiently large amount that you could live off of them for a reasonable period of time.

Personal residences, cars, furniture, and personal items usually aren't included in the determiniation.  There is no set legal limit to the net worth.  However, there is an internally used number of $80,000 that is sort of a threshhold.  Still, benefits may be approved for net worths over $80,000 and they may be denied for net worths under $80,000.  Again, the decision about net worth is subjective.

Basically, since the Pension benefits are designed for lower income Veterans with financial need, excessive net worth may disqualify the applicant.  Much depends on the age, physical condition, life expectancy, and current care costs of the Veteran.

 

In conclusion, the "wartime" requirement disqualifies a lot of Veterans from this benefit and the low income and net worth requirements disqualify even more.  But, for those that qualify, a couple hundred bucks a month is well worth going through the hassle of making the application.

 

Aid & Attendance - THIS IS HUGE FOR WARTIME VETS

The Aid & Attendance benefit is available to those Veterans that:

• Are eligible for the basic Veterans Pension (see "Eligibility" above) AND
• That require the "aid and attendance" of another person

"Aid & Attendance" defined on the VA Website:

• You require the aid of another person in order to perform personal functions required in everyday living, such as bathing, feeding, dressing, attending to the wants of nature, adjusting prosthetic devices, or protecting yourself from the hazards of your daily environment
• You are bedridden, in that your disability or disabilities requires that you remain in bed apart from any prescribed course of convalescence or treatment
• You are a patient in a nursing home due to mental or physical incapacity
• Your eyesight is limited to a corrected 5/200 visual acuity or less in both eyes; or concentric contraction of the visual field to 5 degrees or less

The Veteran has to meet only one of the above definitions.  Physician examination and documentation is required.

A common misunderstanding is that there is a requirement that the Veteran was in a combat zone or that the Veteran's disability was caused during service.  Neither of those are requirements for these pension beneifts.

Here are two very important notes:

1. The Aid & Attendance benefit would be in addition to the basic Veterans Pension discussed previously
2. A Veteran not eligible for the basic Veterans Pension because of income levels MAY still be eligible for Aid & Attendance benefits

Huh?

Let me see if I can explain.  A Veteran may meet the minimum service requirements and the other eligibility criteria for the basic Veterans Pension, but get $0 pension because of the income limits.  However, because the Aid & Attendance benefit is in addition to the Veterans Pension benefit, even if the Pension benefit is $0, the Veteran can get the Aid & Attendance benefit due to higher income limits (see below) if they meet the "aid & attendance" definition.

The Maximum Annual Pension Rate (MAPR) is higher for those that need "aid & attendance"; therefore, Veterans with higher income levels can qualify. For 2014, the MAPR for the Aid & Attendance benefit are:

• $21,107 - Veteran with no spouse or dependent children
• $25,022 - Veteran with one dependent (spouse or child)
• $25,022 - Two Veterans married to each other (one with Aid & Attendance needs)
• $33,480 - Two Veterans married to each other (both with Aid & Attendance needs)
• $16,560 - Veteran still independent, but spouse needs Aid & Attendance

The same 5% of Veterans Pension MAPR applies regarding unreimbursed medical expenses to lower the "countable income".  Read that carefully - it's not 5% of the higher Aid & Attendance MAPR, the 5% is still based on the basic Veterans Pension MAPR from earlier (i.e. $12,652 for a Veteran with no dependents, or $16,569 for a Veteran with one dependent).

Discovering the Aid & Attendance benefit is what got me digging.  My parents' income isn't low enough to qualify for the basic Veterans Pension and they have a Medicare Advantage plan that pays for pretty much all of their medical expenses, so they don't have enough "unreimbursed medical expenses" to reduce their income into the Veterans Pension levels.

However, their income does fall in the range of the "Veteran with one dependent" for Aid & Attendance.

Okay, the math is pretty much the same as it was for the Veterans Pension except that we have higher MAPR for Aid & Attendance.

Let's use the same examples that we used above.    

Calculation Example #1:

Veteran has no dependents and receives $10,000 per year in Social Security, the only income source.  The Veteran meets the definition of "Aid & Attendance".  The Veteran would be entitled to an Aid & Attendance benefit of $11,107 ($21,107 - $10,000) or $925 per month in addition to the $221 Veterans Pension we calculated above.

Calculation Example #2:

Now, let's assume the Veteran has unreimbursed medical expenses.  Unreimbursed medical expenses (those paid out of pocket by the veteran) that exceed 5% of the Veterans Pension MAPR may be deducted from "countable income".

Veteran has no dependents and receives $10,000 per year in Social Security, the only income source.   The Veteran meets the definition of "Aid & Attendance".  However, the Veteran also has $8,000 per year in medical expenses.  Insurance pays for $6,000 but the Veteran has to pay $2,000 out of pocket (unreimbursed medical expenses).  The Veteran must have at least $632 in unreimbursed medical expenses (MAPR of $12,652 X 5%) for them to be deductible   The Veteran can deduct $1,368 ($2,000 - $632) from the income to arrive at $8,632 "countable income".  The Veteran would then be entitled to an Aid & Attendance benefit of $12,475 ($21,107 - $8,632) or $1,040 per month in addition to the $335 Veterans Pension we calculated above.

Calculation Example #3:

Veteran is married and the combined income of both is $18,000.   The Veteran meets the definition of "Aid & Attendance".  They have $5,000 of unreimbursed medical expenses.  They must have at least $828 in unreimbursed medical expenses (MAPR of $16,569 X 5%) for them to be deductible.  They can deduct $4,172 ($5,000 - $828) from their income to arrive at $13,828 "countable income".  The Veteran would be entitled to an Aid & Attendance benefit of $11,194 ($25,022 - $13,828) or $933 per month in addition to the $228 Veterans Pension we calculated above. 

 

So, we can see that Veterans that need assistance in their every day lives (Aid & Attendance) can receive some significant supplementary income to help pay for the cost of care whether it be at home, in Assisted Living, or in a Nursing Home.

The Great "Aid & Attendance" Benefit Secret

Ah, but there is more to this benefit.  There is a special provision in the law that allows the Veteran's household income to be reduced by twelve months of "future, recurring" medical expenses (with proof of course).  Those expenses include insurance premiums (Medicare, Medicare Supplements, Medicare Advantage, or private pay), the cost of in-home care, the cost of Assisted Living, the cost of Nursing Homes, and more.

This has a HUGE effect on who may be eligible for Aid & Attendance and it can easily allow lower income Veterans to receive the full maximum pension amount which I'm showing again here:

• $21,107 ($1,759 per month) - Veteran with no spouse or dependent children
• $25,022 ($2,085 per month) - Veteran with one dependent (spouse or child)
• $25,022 ($2,085 per month) - Two Veterans married to each other (one with Aid & Attendance needs)
• $33,480 ($2,790 per month) - Two Veterans married to each other (both with Aid & Attendance needs)
• $16,560 ($1,380 per month) - Veteran still independent, but spouse needs Aid & Attendance

The special "future, recurring" expenses provision can easily reduce a Veterans "countable income" to $0 which would allow for the payment of the full Aid & Attendance benefit.  And this is a provision that Veterans often aren't aware of.

Let's look at some more examples.

Example #1

Veteran has no dependents and household income of  $30,000 per year.  The Veteran meets the definition of "Aid & Attendance".  The Veteran has agreed with the family to move into an Assisted Living facility.  The average monthly cost of Assisted Living nationwide is $3,500 per month ($42,000 per year) and that's what their cost will be.

The Veteran has some assets, but only enough to cover the additional $1,000 per month above his/her income for two years.

During the Aid & Attendance application process, the Veteran can reduce his/her income by the twelve months of future, recurring costs of the Assisted Living facility (not below $0 of course).  So, the $30,000 household income gets reduced to $0 and the Veteran is therefore entitled to the full Aid & Attendance benefit of $1,759 per month.  With his/her fixed income ($30,000 or $2,500 per month) plus the Aid & Attendance benefit, the cost of the Assisted Living facility is fully covered and there is an additional $759 per month available to be set aside for future cost of care increases.

Example #2

Veteran is married and their household income is $80,000.  The Veteran meets the definition of "Aid & Attendance" due to a sudden, rapidly advancing medical issue.  The family had no choice but to put him/her in a Nursing Home.   The average monthly cost of a Skilled Nursing Facility nationwide is $6,360 per month ($76,320 per year) and that's what their cost will be.

They barely have enough assets to cover that cost for one year.

During the Aid & Attendance application process, the Veteran can reduce his/her income by the twelve months of future, recurring costs of the Skilled Nursing facility ($76,320).  So, the $80,000 household income gets reduced to $3,680 and the Veteran is therefore entitled to an Aid & Attendance benefit of $21,342 (MAPR $25,022 - $3,680), or $1,778 per month.  With the household income ($80,000) plus the $21,342 Aid & Attendance benefit, the monthly income is $8,445 and the cost of the Skilled Nursing facility is fully covered plus there is an additional $2,085 per month available for the spouse or to be set aside for future cost of care increases.

 

I've thrown in those examples to show that the Aid & Attendance benefit can still benefit wartime Veterans that have much higher incomes than the income "limits".  But many VA representatives aren't aware of the special "future, recurring" expenses provision, so they tell those that call in that they aren't eligible if their incomes are above those listed in the MAPR tables.

I've seen statistics showing that only 5% - 10% of Veterans that are eligible for Aid & Attendance benefits are getting them.

That tells me:

• There is a lack of education (The VA website mentions nothing about the "future, recurring" annualized expense provision that gets more Veterans qualified and gets them higher monthly benefits)
• Veterans are being dissuaded due to lack of knowledge or training of VA representatives
• Veterans are being told by someone that they aren't eligible (mostly due to the income or net worth tests)
• Veterans see the red tape of the application process as too difficult

 

Okay, so the "future, recurring" medical expenses are really easy to document for the application process when there is the all-in-one care cost of an Assisted Living or Skilled Nursing facility.  It gets a little more complicated and harder to document and quantify the costs of in-home care.  Basically, someone has to pay for necessary care and the caregiver can be a family member, a contracted caregiver, or an in-home care agency.

Often family members take care of their elderly relatives with no compensation because the money just doesn't exist.  The Aid & Attendance benefit can make things better for all involved.  Let's look at another example.

Example #3

Veteran is married and their retirement income totals $24,000.  The Veteran meets the definition of "Aid & Attendance".  Their house is paid for, they have no debt, and they are squeaking by on $1,800 per month ($21,600 per year).  But they are getting up in years and their health needs are increasing.  They can't afford an Assisted Living facility for either of them, and they prefer to stay in their home as long as possible.  Family members have been taking turns taking care of them without compensation.

Their maximum potential Aid & Attendance benefit is $25,022 or $2,085 per month.  But to get that maximum amount they need to have future, recurring medical costs of at least $25,022 per year to reduce their household income to $0, but they are only making $24,000 and their current medical-related costs are only about $12,000 or $1,000 per month.

The family decides it is in the best interest of all parties to create a "caregiver agreement" and to compensate the family caregivers at a rate of $10 per hour with a requirement that care be provided four hours each day seven days a week.  The total of paid care is ($10 per hour X 4 hours per day X 30 days a month) $1,200 per month or $14,400 a year.

Now to make the documentation easier for the VA application, the "caregiver agreement" combines the $1,200 per month with the already existing $1,000 per month recurring medical expenses for a total of $2,200 per month.  This amount is paid out of the Veteran's monthly income and available cash assets to the designated caregiver that is responsible for directing and scheduling care and paying all caregiving expenses.

For Aid & Attendance application purposes, the $2,200 per month can be annualized to $26,520 and used to reduce the household income to $0.  When approved, the Veteran would get the full benefit of $2,085 per month.

So, the Veteran and spouse would get $4,085 per month in income (fixed income of $2,000 plus Aid & Attendance benefit of $2,085).  They would pay out $2,200 per month for daily in-home care and medical expenses.  They would have $1,885 per month to use for personal expenses and to set aside for increased cost of care later.  Plus, the family caregivers are now being fairly compensated for their time and that compensation actually helped the Veteran receive the additional benefits.        

 

In the case of Aid & Attendance, there is actually incentive to spend more money on the care of aging Veterans in order to maximize the benefit which ultimately makes life better for all involved.

Net Worth Limitation

Okay, before we continue, we have to remind you that there is still a Net Worth or asset test.  Although, much higher incomes may still qualify for Aid & Attendance, the Veteran still cannot have a stash of cash or other assets that can be turned into cash that could be used for care making the Aid & Attendance benefit unnecessary.

Again, there is no set limit.  It's a subjective review based on age, care needs, life expectancy, current care costs, etc.

For example, if the Veteran has assets with values of five times the annual cost of an Assisted Living facility, chances are the benefit will be denied.  If he/she has a year or two of such costs, the benefit is more likely to be approved.  But every situation is different.

If you are concerned about denial of the Aid & Attendance benefit because of the Veteran's net worth, there are opportunities to shift assets or "spend down" much the way it is done for Medicaid Long Term Services & Supports (LTSS) planning purposes.  However, there currently is no "look back" period for VA Pensions like there is for Medicaid.

Medicaid has a five-year "look back" period in which assets transferred during that time can be included in determining Medicaid eligibility.  Of course, there are rumblings about establishing some type of "look back" period for VA Pensions as well, but as of the date of this writing, it doesn't exist.

UPDATE:  Proposed rules to establish a three-year look back period for Aid & Attendance are expected to go into effect at the end of the 2016 fiscal year.

Way back in 2006/2007 when my Mom was having health issues, we started a Medicaid planning process and transferred assets so that either of my parents would be eligible for Medicaid should there be a sudden need for Skilled Nursing Care.  That planning has turned out to be helpful now as we are pursuing the Aid & Attendance benefit.

Though the value of the Veteran's primary residence may be excluded from the Net Worth test, it's important to note that there could be issues should the house need to be sold when the Veteran goes into an Assisted Living or Skilled Nursing facility.  The proceeds from the sale of the house, could disqualify the Veteran from continued benefits under the Net Worth test.

That's why it's important to involve professionals in the process to make sure the chances for delays or denials of benefits are reduced, assets are protected, and future benefits aren't lost due to poor planning in the beginning.

 

Application Pitfalls

The following documents are needed for application:

• The 26-page Aid & Attendance application
• A detailed physician's statement is also required as evidence of the Veteran's condition and need for "aid & attendance"
• Original military discharge/separation (or certified copies) papers are required (DD-214)
• Marriage certificates are required for Veterans with spouses 
• Copy of Social Security Award letter
• Documentation of income
• Documentation of net worth
• Proof of health insurance payments and other unreimbursed medical expenses
• Copies of Assisted Living contracts, Nursing Home contracts, Home Care agency contracts, personal/family "caregiver agreements", etc.    

The approval of Aid & Attendance can take anywhere from a month to six months or even much longer.  I'm seeing average timeframes in my research of 4-6 months.  But you want to be sure you submit everything and that it is proper.  Major delays and even denials occur because of missing information or documents.

To take advantage of the special annualizing provision for "future, recurring" expenses, you MUST have those expenses in place BEFORE application.  Often the application is made before Assisted Living or Home Care or "Caregiver Agreements" are in place, so those expenses are speculative and can't be proven thus causing denial of the benefit (or at least long delays).

The other big problem for many people is that they have to spend more than their income during the application approval process (in order to reduce their "countable" income to $0 for the maximum benefit), and many don't have extra funds to cover costs during that 4- 6 month period.

The good news is that the VA date stamps the application when received, and they will backpay benefits in a lump sum if the Aid & Attendance is approved.  Everything is based on the first of the month, so you want to make sure the application gets there before the first and not on the second or you will have lost a month of benefits.

I understand this now better than most, but I'm still going to rely on professionals to guide me through.  I have met with a financial planner that specializes in these applications and an attorney that drafts legal documents as part of the process.  We only need a "caregiver agreement", but sometimes it is necessary to create a trust and other documents.  In our case, our prior Medicaid planning served us well, so our costs will be limited to about $500 to pursue the Aid & Attendance benefit.

I'd recommend using professionals, but be careful.  No one is allowed to charge a fee for assisting with the application process and only those that are "accredited" by the VA can offer this service.

"An individual  cannot advise a veteran or other eligible beneficiary about that person's specific claim for VA benefits unless that individual is accredited." 

Often, the only way an advisor can be compensated is by assisting with other financial/retirement planning.  However, there are those that use the "net worth" limitation to have assets transferred into shady investments or high commission investment products.  Again, be careful and make sure whoever you are working with is accredited.

  

Housebound

Like Aid & Attendance, Housebound benefits may not be paid without eligibility for Veterans Pension discussed earlier.

Like Aid & Attendance, Housebound benefits are in addition to Veterans Pensions benefits.  However, a Veteran cannot receive both Homebound and Aid & Attendance benefits - it's one or the other.  But Aid & Attendance has higher income limits and higher potential benefits.  

A veteran may be eligible for Housebound benefits when:

• The veteran has a single permanent disability evaluated as 100-percent disabling AND, due to such disability, he/she is permanently and substantially confined to his/her immediate premises, OR,
• The veteran has a single permanent disability evaluated as 100-percent disabling AND, another disability, or disabilities, evaluated as 60 percent or more disabling.

This does not mean the Veteran is permanently confined to his/her personal residence.  The Veteran could be in a facility or in someone else's home.

For 2014, the MAPR for the Housebound benefit are:

• $15,462 - Veteran with no spouse or dependent children
• $19,380 - Veteran with one dependent (spouse or child)
• $19,380 - Two Veterans married to each other (one Housebound)
• $22,188 - Two Veterans married to each other (both Housebound) 

 

Everything else is basically the same as for Aid & Attendance, so there is no need to rehash all the prior details.

It's hard to imagine how one could be eligible for Housebound benefits and not eligible for Aid & Attendance, but I suppose that could be the case.  If that is the case, the calculations for "countable income" and the benefits are the same except that the lower Housebound MAPR would be used.

 

Surviving Spouse Benefits

Before I get into surviving spouses, I'd like to quickly talk about the Aid & Attendance benefit for ill spouses of living, independent Veterans.

Although the Veteran may not qualify himself/herself for Aid & Attendance according to the criteria listed previously, he/she may still be able to apply for Aid & Attendance for the spouse as long as all other eligibility requirements are met.

If the total medical expenses to take care of the ill spouse exceed their combined income, they can get this benefit:

• $16,560 ($1,380 per month) - Veteran still independent, but spouse needs Aid & Attendance

This is another often-overlooked benefit.  The same Veteran eligibility requirements apply EXCEPT the disability and need for "aid & attendance" is for the spouse and therefore proof of medical necessity is for the spouse.

 

Death of the Veteran

Let's get this out of the way first.  All the pension benefits discussed previously end immediately with the death of the Veteran.  A surviving spouse may be able to keep the next payment received after the death of the Veteran, but all other payments would have to be returned.

What if the Veteran dies during the Pension application process?  Well, there is a substitution rule that allows an eligible family member (usually a surviving spouse) to be substituted for the Veteran to see the application process through as if the Veteran were still alive.

Remember that benefits start accruing as soon as the application is received by the VA, so there may be accrued benefits of several thousand dollars a surviving spouse might be entitled to.

Example

Veteran (with a spouse) applies for Aid & Attendance benefits in December 2013.  If approved the Veteran would receive $2,085 per month.  Benefit accrual starts January 1, 2014.  Application is still pending when the Veteran dies in July 2014.

The surviving spouse can apply to be "substituted" for the Veteran in order to see the application process through to the end.  The application finally gets approved in October 2014.

The surviving spouse would be entitled to the benefits that accrued from January through June - 6 months at $2,085 or $12,510.  However, the death of the Veteran in July cut off the accrual of any future benefits, and no monthly payments would ever be sent (in theory).          

 

Survivors Pension Benefits (formerly Death Benefits)

A surviving spouse of a wartime Veteran may be entitled to a lesser amount of the same benefits.  Eligibility starts with the Veteran's service period and discharge record as discussed previously. 

Minimum Service Requirements - (Applies to the Veteran)

 

• At least 90 days of active duty with at least one day of service during a wartime period (for those in service prior to September 7, 1980)
• At least 24 months OR the full tour of service for which you were called to duty with at least one day of service during a wartime period (for those entering active duty after September 7, 1980)
• Discharged from service under "other than dishonorable" conditions

 

 

 

Under current law, VA recognizes the following wartime periods to determine eligibility for VA Pension benefits: 

 

• World War I (April 6, 1917 – November 11, 1918)
• World War II (December 7, 1941 – December 31, 1946)
• Korean conflict (June 27, 1950 – January 31, 1955)
• Vietnam era (February 28, 1961 – May 7, 1975 for Veterans who served in the Republic of Vietnam during that period; otherwise August 5, 1964 – May 7, 1975)
• Gulf War (August 2, 1990 – through a future date to be set by law or Presidential Proclamation)

 

 

Once it is determined that the deceased Veteran would have qualified under the above criteria, the remaining eligibility requirements are based on the surviving spouse.

A "surviving spouse" must have been 1) married to the Veteran at the time of the Veteran's death AND 2) not remarried ... to get Survivors Pension benefits. 

There is an exception for the period of January 1, 1971 - October 31, 1990.  A spouse divorced from the Veteran during that period may still be able to get a Survivors Pension, BUT any remarriage terminates the spousal entitlement. 

Once we've gotten over all of those hurdles, the surviving spouse may be able to get:

• Basic Survivors Pension
• Aid & Attendance Survivors benefits
• Housebound Survivors benefits

The spouse must meet the income and net worth tests on their own, and the spouse must meet the definition of Aid & Attendance or Housebound to get one of those special benefits.

 

Let's look at the Maximum Annual Pension Rates (MAPR) for the various Survivors Pension scenarios:

 

Basic Survivors Pension - 2014 MAPR

• $8,485 ($707 per month) - Surviving Spouse without dependent child
• $11,107 ($925 per month) - Surviving Spouse with one dependent child
• $2,161 ($180 per month) - Each additional dependent child

Reminder:  Unreimbursed medical expenses over 5% of MAPR can be used to reduce income just like we did on the basic Veterans Pension. 

 

Aid & Attendance - 2014 MAPR

• $13,563 ($1,130 per month) - Surviving Spouse without dependent child
• $16,180 ($1,348 per month) - Surviving Spouse with one dependent child
• $2,161 ($180 per month) - Each additional dependent child

 

Housebound - 2014 MAPR  

• $10,371 ($864 per month) - Surviving Spouse without dependent child
• $12,988 ($1,082 per month) - Surviving Spouse with one dependent child
• $2,161 ($180 per month) - Each additional dependent child

 

Just like the Veterans Aid & Attendance and Housebound benefits, the special "future, recurring" medical expenses provision applies to the Survivors Aid & Attendance and Housebound calculations to determine eligibility and benefit level.

Under Aid & Attendance, the maximum spousal benefit would be $1,130 per month .... well worth going to the trouble of applying.

Note that the Survivors Pension benefits are completely independent of the Veterans Pensions. It doesn't matter that the Veteran was not receiving benefits.  And it doesn't matter if they were.  Once the Veteran passes away, survivors must submit their own applications. 

 

Conclusion

The main thing I hope to convey here is that there are significant VA benefits for many veterans and their spouses/surviving spouses that most people don't know about or understand.

For many of us full-time RVers that happen to have parents that served in the military during wartime, Aid & Attendance pension income may be exactly what we need to ensure the care of our elderly parents and provide some peace of mind.

If you think your parents (or yourself for that matter) may qualify for these benefits, read through this entry a few times slowly and then do some internet searches to confirm what we've told you.

These VA Veterans Pensions are not new.  They are considered "Non-Service Connected Pensions" and have been around since 1952.  However, as we mentioned numerous times, a very small percentage of Veterans know about these benefits.

It's quite possible that those that do know about these benefits were casually brushed off as not being eligible.  So, if you have checked into this before, you may very well have been given incorrect information.

I know this is a lot to take in, and it may only apply to a few.  But if it helps even one person get some additional benefits and care for loved ones, it's worth the hours I've spent on it.  :)

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Comments

[Timothy Fansler]

Wow! You must have spent many hours researching this. My head hurts from reading all this. I am a VietNam era veteran (USMC 1968-1972)and never heard of any of this. I'm retired now and getting by on Social Security, although I do have sizeable assets in an IRA that so far I haven't had to touch. Thanks to RV-Dreams my needs are pretty simple; downsizing and simplifying have made a big difference. I'm partially disabled now having to use a walker. I can still drive, when I can get to the car - swiveling my foot from the gas pedal to the brake pedal is pretty easy. When I can't do that any more it will be time for elder care, either in my home (which is paid for) or some kind of elder care facility. Thanks for the information. Can you put it on a separate page so it's easier to find?

[Janna]

Wow--thanks so much Howard for your research! Mike's Dad is also 92 and a WWII veteran. His net worth is probably too much to quality for any assistance but I'm going to do some checking. Not long ago a person affiliated with the VA came to their Senior Center where Nat has lunch every day and noticed Nat's inability to hear--Nat thought he was completing paperwork to help pay for a new hearing aid--no, Nat now gets a small pension each month to compensate him for his hearing loss which probably occurred while serving on B29 aircraft over the Pacific. Thanks again Howard for the great info!!

[Jim Wathen]

Wow, Howard! Your timing could not have been more perfect. We had just begun the arduous process of researching this as my Dad entered a Health Care Facility last month due to his advancing Alzheimer’s. His service as an Air Traffic Controller in the Air Force during the Korean conflict would make him eligible for benefits. I have forwarded your information to my Mom as well. We can’t thank you enough for your continual generous sharing.

Hugs, Jim (& Linda)

[Patty Hooley]

Awesome post. Mark & I are also facing disabled parents and this benefit is, as you say, HUGE! Thanks for your lengthy explanation and link info. It will help many of us.

[Bill and Jodee]

This is great information, thank you so much for sharing what you researched! This could make a huge difference for my MIL who, at 89, is having to make some decisions about her declining ability to live alone. As a surviving spouse she may indeed be eligible :-). You rock!!
Jodee

[John Huggins]

This a great article and contains real gold for eligible vets and spouses. I printed it out and we have it on permanent file. We will discuss this and refer back to your blog on this week's podcast.

[Marty & Roz]

Howard, you are definitely "the gift that keeps on giving." Throughout your RV tenure you have regularly provided valuable information to "your followers." This is probably the most significant piece of research provided to date. I am military retired but was not aware of the Survivors Benefit potential for the nonmilitary survivor till reading this.

You definitely have Barrister potential. Much appreciated.

Marty

[Charles Howard]

Great, detailed summary.
Pitfalls as you mention are the detailed applications. I did so for my Korean War Vet Father. After several months it came back for fixing some inadvertant ommisions. Then rejected as his income was just a little too high for the twice a week caregiver regimen we instituted while we traveled for a few months each year. Then his condition worsened and we ratained 5 day/week care and reapplied. Unfortunately he passed away before we were able to resolve that with the VA (He was spending all his income on the home care). I'm sure if we would have had to put him in a Nursing home we could have gotten his benefit, but alas that did not become necessary.
Service and response from the VA was slow, but acceptable.
If I had to do it over again I would retain a VA (like Social Security Disability) expert.

[Tracy Perkins]

Wonderful job Howard. As always impressed by the lengths you will go to to find the true information. My father is a Vietnam vet and although at current does not meet the income requirement, you never know what the future holds. Good to have this information in my back pocket.

[Jack Mayer]

Howard, do you know if a non-revocable trust serves as asset protection for this benefit?

[The Bear II]

Howard this post brought back memories of signing my dad up for VA benefits. I found out from a third party that my dad may be elegible for VA diasbility benefits. He served in the Army during WWII.
Long story short, due to the backlog, it took nearly two years for the benefits to begin flowing. The VA did retroactively pay from his start date which was set once the VA approved all of the submitted paprwork.

[Steve Banasky]

Thanks Howard.
Great information. I will certainly look into this. Much appreciated

[Howard]

Jack,

Check with an accredited agent or eldercare attorney, but I believe an irrevocable trust would be an acceptable transfer of assets for this benefit.

Howard

[Rhodium]

I am late to read this but it is clearly highly useful (although not to me). I am sure you have thought of this, but I would encourage you to expand it and turn this into an ebook to potentially increase the readership (and monetize it). You deserve to be compensated for all your hard work on this.
For those having troubles with the VA, some (but not all) congressional or senatorial offices have good constituent services that can help, and I will bet many offices will find new information in this post.

[Tioga Dan]

I am about to take the big FT plunge and already receive VA benefits. I am trying to find out what the VA residency requirements are. I wonder if they'll let me live in my RV, or should I just do a change in my address with one of the mail forwarding services?
I receive Social Security too, and don't want to get in trouble with either one. Thanks in advance for any comments or suggestions.

[Mary Morrison]

Howard, Thank you so much for all this information. I am former military retired and am single. This information will be invaluable when it comes time for me to need this extra care. I do not want to burden my family when I may be eligible for the necessary benefits that would take care of my needs. It is amazing that this information has come at this time. I have friends who are veterans from the Vietnam era who are in need of assistance. I am going to pass this on to my friends who are also veterans. Learned about this from John and Cathy's POD cast - Living the RV Dream.