VA Proposes Major Changes to Aid and Attendance Program

The Department of Veterans Affairs (VA) is proposing significant changes to needs-based benefit programs, including an asset limit, a look-back period, asset transfer penalties, and deductible medical expenses, as follows:

  • Look-bank Period/Penalty Period: The new rules would establish a 36-month look-back period and a penalty period of up to 10 years for those who dispose of assets to qualify for a VA pension. The penalty period would be calculated based on the total assets transferred during the look-back period to the extent they would have exceeded a new net worth limit that the rules also establish.
  • Net Worth Limit: The proposed net worth limit would be equal to Medicaid’s maximum community spouse resource allowance (CSRA) prevailing at the time the final rule is published (In 2015 this amount is $119,220) and would be indexed for inflation as the CSRA is – by adjusting it at the same time and by the same percentage as cost-of-living increases provided to Social Security beneficiaries. The VA would not consider a claimant’s primary residence as an asset. However, if the residence is sold, proceeds from the sale would be assets unless used to purchase another residence within the calendar year of the sale. The same net worth limit would apply when a surviving spouse is seeking pension benefits.
  • Deductible Medical Expenses: The law would provide that VA may deduct a claimant’s out-of-pocket medical expenses from the claimant’s countable income to decrease the claimant’s income, thereby increasing the claimant’s benefit entitlement rate.

Read the proposed rules in 80 Federal Register 3840-3864 (23 Jan 2015).

It is a good time to apply for veteran’s benefits, such as Veteran’s Aid and Attendance, before the laws change. Here at the Farr Law Firm, we work with veterans and their spouses to evaluate whether they qualify for the Veterans Aid and Attendance Benefit and/or Medicaid, and we deal with all the paperwork. As an Accredited Attorney with the U.S. Dept. of Veterans Affairs, I understand both the Veterans Aid and Attendance Benefit and the Medicaid program and the interaction between both benefit programs. Please call us in Fairfax at 703-691-1888, in Fredericksburg at 540-479-1435, in Rockville, MD at 301-519-8041, or in Washington, DC at 202-587-2797 to make an appointment for a consultation.

P.S. Another benefit of being a veteran is a 15% discount off all services at the Farr Law Firm. We hope to see your family soon!

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About Evan H Farr, CELA, CAP

Evan H. Farr is a 4-time Best-Selling author in the field of Elder Law and Estate Planning. In addition to being one of approximately 500 Certified Elder Law Attorneys in the Country, Evan is one of approximately 100 members of the Council of Advanced Practitioners of the National Academy of Elder Law Attorneys and is a Charter Member of the Academy of Special Needs Planners.