If you are a veteran overwhelmed with the high cost of long-term elder care, such as paying for assisted living facilities, home care aids, adult daycare, or skilled nursing, the Veterans Aid and Attendance benefit could be the solution to help offset these rising care costs. A wartime veteran or their surviving spouse with limited income may be eligible to receive a non-service connected pension (this means that the need for care does not have to result from one’s military service). There are three levels of VA Pensions:
The Aid & Attendance and Housebound pensions provide additional monthly income over and above the Basic Monthly pension. To be eligible for either of these pensions, one must also meet the requirements for the Basic Pension.
In 2020, qualifying veterans and their spouses could be eligible for a VA Pension of approximately $2,266 per month to help cover the costs of elder care assistance.
The Aid and Attendance benefit is a monetary benefit that helps eligible veterans and their surviving spouses (widows / widowers) to pay for the assistance they need in everyday functioning (eating, bathing, dressing, and medication management).
Readers should know that the A&A benefit is often referred to by other names. One will sometimes hear the names “improved pension”, “VA assisted living benefit” or “veterans elder care benefits”. These are various names for the same program, which, as mentioned before, is an additional benefit added to the basic VA pension.
Receiving a VA pension may disqualify a veteran for Medicaid or VA disability compensation.
Veterans and their families should be aware of potential eligibility conflicts between pensions and other assistance from the Department of Veterans Affairs and / or other government programs.
A final note of good news is that veterans can receive both Aid and Attendance and Veterans Directed Home and Community Based Services.
Before we explain the complex financial considerations for Aid & Attendance eligibility, it’s important to note the general requirements—which must be met by the veteran or their surviving spouse.
1) Age – Veterans or their surviving spouses must be at least 65 or officially disabled if younger.
2) Period of Military Service – Veterans must be considered “wartime veterans” meaning they served at least 90 days and served at least 1 day during the wartime dates below, but not necessarily in combat.
3) Discharge Status – Veterans cannot have been dishonorably discharged.
4) Disability Status – Veterans are eligible without a disability, but a higher benefit is available to those who are disabled.
5) Marriage Rules: a surviving spouse must have been living with the veteran at the time of their death and must be single at time of claim.
The VA has both income and asset limits for the Aid & Attendance, Housebound, and the Basic Pensions.
A veteran’s and their spouse’s joint, countable income must be less than the pension amount for which they are eligible. For example, a married veteran in 2020 is eligible for $27,194 in A&A pension; if their countable income is $10,000, then they are eligible to receive an additional $17,194 / year in pension.
However, because the VA allows applicants to deduct certain expenses and forms of income from their “countable income”, the applicants’ actual income can be considerably higher than their countable income.
Veterans should deduct all of their unreimbursed, recurring medical-related expenses for themselves and their spouses that are greater than 5% of the Maximum Annual Pension Rate (MAPR). For example, for a married couple applying for Aid & Attendance, 5% of the MAPR is $1,360. Therefore, if a couple has an annual income of $30,000, and $25,000 in medical-related expenses, one would subtract $1,360 from $25,000, which means $23,640 of their medical expenses could be deducted from their income. Therefore, their countable income would be $6,360 vs. an actual income of $30,000.Medical-related expenses include the cost of care in skilled nursing, assisted living, adult day centers, and at home. Medicare and other insurance premiums, as well as prescriptions not covered by insurance, should also be included as medical-related expenses. Income from Supplemental Security Income (SSI) and welfare benefits should not be included as countable income. A detailed explanation of how the VA calculates income is available here. Assistance is available to help veterans determine their countable income, which will enable them to receive their maximum benefit amount. Read more.
2020 Basic / Housebound / Aid and Attendance Income Limits (effective 12/1/19 – 11/30/20)
Veteran Family Status
|Basic Pension Income Limit||Housebound Income Limit||Aid & Attendance Income Limit|
|Veteran with no dependents||
|Veteran with a spouse* or child**||$18,008||$21,063||
|Surviving spouse / death pension*||$9,223||$11,273||
*Presumes the spouse is not also a veteran **Add $2,313 for each additional child
Net Worth / Assets + Income Limit for Aid and Attendance and other Pensions
When calculating assets, the VA allows veterans to deduct the value of their home and vehicles.
To qualify for the Aid and Attendance benefit and other pensions, the VA will look at the applicant’s overall net worth, which includes both (assets) and annual income. Assets, according to the VA, includes assets in bank accounts, stocks, bonds, mutual funds, and property other than the veteran’s primary residence and vehicle. Other items that can be excluded when determining net worth are household goods and furnishings, as well as personal effects, such as clothing.
As of 10/18/18, the VA implemented a net worth limit of $123,600. However, this net worth limit has since increased to $127,061 and is projected to be $129,094 in 2020. Please note that this limit is the same for single and married applicants. Up until this time, there had been no hard limit to the asset threshold allowed. Rather, the VA had looked at whether one’s income and assets were substantial enough that the veteran or spouse could live off of them for a considerable amount of time. The VA had also taken in to account the veteran’s age, his or her care expenses, and life expectancy. However, this all changed with the implementation of the hard net worth limit.
As mentioned above, one’s net worth includes one’s annual income (after deducting unreimbursed medical expenses). Say a veteran has $12,000 in annual income after deducting eligible medical expenses, and has assets in the amount of $100,000. In this example, $12,000 in income would be added to the $100,000 in assets, equaling a total of $112,000 in net worth for the applicant.
The VA also has an asset look back rule that became effective on 10/18/18. This is similar to Medicaid’s asset test, which “looks back” at an applicant’s past asset transfers for up to 5 years preceding their application. However, the VA “look back” period is only for 3 years. During this timeframe, which immediately precedes one’s application date, the VA checks to ensure no assets were given away or sold under fair market value. If they find any such transfers, it is assumed the assets were gifted or sold in order to meet the 2020 net worth limit of $129,094. Therefore, there will be a period of VA pension ineligibility, up to 5 years. Please note that transfers made prior to 10/18/18 do not violate this new look back rule. Another exception is if the applicant transferred assets, but never had a net worth in excess of $129,094. If this is the case, these transfers do not violate the look back period.
If one’s net worth is above $129,094 in 2020, it is strongly recommended that they consult with a veterans’ pension planner prior to application to ensure the greatest possibility of acceptance.
VA Pensions are paid to the beneficiary monthly by check or direct deposit. Payments are made to the veteran or their surviving spouse, but are not paid directly to their care or service providers. The table below shows the VA’s Maximum Annual Pension Rates (MAPR) for each level.
Basic Pension / Housebound / Aid and Attendance MAPR for 2019 (effective 12/1/19)
|Veteran Family Status||Basic Pension Income Limit||Housebound Income Limit||Aid & Attendance Income Limit|
|Veteran with no dependents||$13,752||$16,805||$22,938|
|Veteran with a spouse* or child**||$18,008||$21,063||$27,194|
|Surviving spouse / death pension*||$9,223||$11,273||$14,761|
*Presumes the spouse is not also a veteran **Add $2,313 for each additional child
Many readers are unaware that VA Pensions can be used to pay a family member who is the caregiver of a veteran or survivor (with the exception of spouses). As mentioned previously, care expenses can be deducted from a Veteran or surviving spouse’s income, including payments made to family members, such as children or grandchildren. Beneficiaries can then receive an increased pension benefit equal to the amount they have paid to their family member for care.
Unfortunately, this method does not work for the veteran’s spouse since joint income is calculated as household income. Therefore, any salary the spouse received would be included as part of their household income, and would not be considered a deductible care expense.
If a veteran or a surviving spouse is eligible for the Aid and Attendance benefit, they may also be eligible for the retroactive benefits pension. If a veteran can prove their expenses on medical care in a period up to a year prior to the month for which they will have received the first pension, they can receive the retroactive benefit for that period. For example, if a veteran receives their first pension for the month of January 2020, they can receive the retroactive benefits pension for a period up to January 2019. A veteran is eligible for the retroactive benefits pension only if they had already been granted the regular pension. Furthermore, they have to provide proof that they needed assistance in everyday functioning before they started receiving the pension.
Many applicants wait 9 – 12 months to begin receiving their benefits. However, this does not have to be the case.
The application process is long and complicated. To apply, it is best to get help from a professional benefits advisor / planner. Working with an advisor can reduce the time to receive benefits by many months, increase the benefit amount, and provide other value. However, even in the very best cases, applicants will wait 3 months to begin receiving their benefits. Read more about working with an advisor.
Once approved, benefits are paid retroactively in a lump sum to the claim effective date. As a result of this, it is fairly easy to be approved for a loan that can pay for care during the application processing wait time (“determination period”). Repayment of the loan can be made from the lump sum. For families with an immediate financial need and who are seeking home care or assisted living, there is an organization that can both help with the application process and provide a loan while the application is being processed. Learn more here.
Having mentioned the pension claim backlog, it should be said that the VA has undertaken a major initiative to reduce it and is experiencing some success in doing so. They are also increasing transparency about their processing backlog as they are providing regular (though somewhat cryptic) reports which are available to the public.
There are no charges to apply for or to enroll in a VA Pension. Veterans benefits advisors are prohibited by law from charging their clients for their assistance with the application. However, they may charge clients for assistance in the structuring of their financial assets in preparation for the application.
Veterans who are certain they are eligible – If a veteran is highly confident that they meet ALL eligibility requirements, they can use the following application methods. Little or no human assistance will be available.
1. Apply online on the U.S. Department of Veterans Affairs website. Do not use online application if you:
2. Download and fill out the documents and send to one’s Pension Management Center.
3. Contact a Veterans Service Officer at a regional VA office or call toll free 1-800-827-1000
Veterans uncertain of their eligibility – If a veteran or their family members are uncertain about their eligibility or which type of compensation is most beneficial to their situation, it is strongly advised that they seek the counsel of a veterans’ benefits planner prior to application. Learn more or find a benefits planner.
Check the status of an existing claim by contacting the VA Pension Maintenance Center at 877-294-6380.