Helping clients obtain benefits through the Veterans Administration (“VA”) is a rapidly growing area.  Estate planning and elder law attorneys alike are adding this to their repertoire of services to offer clients.   It is easy to understand why:  we are helping veterans who fought for our country to obtain much deserved benefits that many of them are currently unaware of.

Both veterans and surviving spouses may be eligible for monthly cash payments as a result of a veteran’s wartime service (referred to as “pension”) or because the veteran suffered a permanent debilitating injury as the result of their service (referred to as “compensation”).   Increased pension allowances (commonly referred to as “aid and attendance” or “housebound”) are available when a veteran or surviving spouse requires ongoing medical care to assist with activities of daily living.

Helping veterans or surviving spouses qualify for pension with an allowance for aid and attendance is a very rewarding practice area for attorneys.  This benefit provides a significant monthly cash payment to a veteran or surviving spouse.  But, there are income and asset restrictions that require similar analysis and planning just as if the client was trying to qualify for Medicaid.    However, Medicaid and VA Pension are two very different programs that require a great deal of technical knowledge and training.  And, any attorney who wants to assist a client in obtaining any benefit through the VA Pension must first become accredited.

There are a number of pitfalls for the unsuspecting attorney who enters the area of VA Benefits.

• Failing to understand the distinction between compensation and pension. A veteran who is eligible for compensation could receive a higher monthly payment than a pension claim, depending on the disability rating of the veteran.  If the attorney advising the veteran is not aware of the available monthly payment for compensation and only discusses pension, the result is the veteran has now had his or her assets and income reduced needlessly and could receive a smaller monthly payment than if a claim for compensation had been made.
• Failing to provide proper documentation when submitting a pension claim. If a claim is submitted and necessary paperwork or information is missing, it will either delay the claim for many months or result in the client missing out on several month’s payments totaling thousands of dollars.

Perhaps the most damaging pitfall has nothing to do with planning in this area, but rather deals with a lack of knowledge on the part of the attorney.  The following is a situation that unfortunately happens more often than it should.

A son and his mother come visit an attorney regarding his father (and her husband) who is a World War II Veteran.  The father is currently at home with a caregiver that comes in eight hours every day.   The expense is getting to be too much.  The son and his mother were told to consult an attorney to see if anything could be done before the couple runs out of money completely.

Medicaid in this particular state does not pay for in-home care or assisted living care so the attorney informs them that the only way to get any type of financial help is to move the husband into a nursing home and qualify him for Medicaid.  The son and his mother are distraught as they had hoped to keep the father at home or at least in assisted living.

In this scenario, a huge opportunity was missed.  With proper planning, the veteran could have received up to $1,949 each month to help pay for the in-home care.  Unfortunately, the attorney was not aware of the pension benefit available through the VA.

Even if you do not intend to practice in this area, these pitfalls can seriously impact your law practice.

To learn more about pitfalls to be aware of and how to avoid them, be sure to join me August 12th in Chicago.  I will be presenting a live breakout session with James Swain entitled, “Pitfalls to Avoid When Planning for Clients Who Are Veterans.”

Valerie L. Peterson

Valerie is the Executive Director of ElderCounsel, LLC , an organization that provides document drafting software, education and support to elder law and special needs attorneys across the United States.  Valerie is a frequent lecturer on elder law and Veterans Benefits.

What happens when a veteran or surviving spouse receiving Aid and Attendance goes into a nursing home?  A reduction in benefits may occur but only after the veteran or surviving spouse becomes eligible for Medicaid while in the nursing home.  When this happens, an unmarried veteran or surviving spouse’s Aid and Attendance pension benefit will be reduced to $90.  See 38 CFR §3.551(i).

However, if the veteran is married or has a dependent child living at home the reduction is not automatic.  If the spouse or dependent child has unreimbursed medical expenses then the veteran may continue to receive all or a part of the Aid and Attendance payment, even after entering a nursing home and qualifying for Medicaid.  Why is this the case?  The VA counts household income and deducts recurring household out-of-pocket medical expenses when determining eligibility for Aid and Attendance pension.  Even though the veteran is in a nursing home, the spouse’s income and out-of-pocket recurring medical expenses are counted when determining eligibility.

The lesson to be learned here:  Do not allow the VA to automatically reduce a married veteran’s Aid and Attendance award to $90 if the spouse at home has recurring out-of-pocket medical expenses.   Instead, submit evidence of the spouse’s recurring medical expenses once the veteran is approved for Medicaid, and the VA will recalculate the veteran’s eligibility for Aid and Attendance and could approve an amount over $90 per month.

ElderCounsel hosts educational events to train attorneys on Veterans Benefits.  To find the next class or to order the recording and materials from a prior class, please visit our Education Calendar and  Marketplace on our website.

Valerie L. Peterson

Valerie is the Executive Director of ElderCounsel, LLC , an organization that provides document drafting software, education and support to elder law and special needs attorneys across the United States.  Valerie is a frequent lecturer on elder law and Veterans Benefits.