Aid and Attendance is an extremely valuable veterans benefit that is available to veterans and their spouses who are at least sixty-five years of age to assist them with the cost of in-home care, assisted living, and nursing home care. Aid and Attendance is perhaps most beneficial for veterans and their spouses in need of home care and assisted living since no other government program covers such care.
The 2018 monthly aid and attendance benefit is now
- 2,169 for a veteran and spouse,
- $1,830 for a single veteran, and
- $1,176 for the surviving spouse of a veteran
We have written for several years regarding the possibility of the VA imposing a 36-month look-back for VA Aid and Attendance. Well, it’s here!
Effective October 18, 2018 the VA will now count gifts made by the applicant or the applicant’s spouse within three
years of applying for Aid and Attendance. Gifts made within three years of application create a period of disqualification (measured in months) equal to the amount gifted divided by $2,169 (the maximum monthly pension rate for a veteran with a dependent).
Thus, for example, if a gift of $100,000 is made November 1, 2018, the veteran would be ineligible to apply for Aid and Attendance for a period of thirtysix months (the lesser of thirty-six months or forty-six months ($100,000 divided by $2,169)). The veteran could unwittingly create a period of disqualification longer than 36 months (up to sixty months) under the fact pattern above if she were to apply for Aid and Attendance prior to the expiration of the thirty-six month period. In such cases, the penalty period is the longer of thirty-six months or the actual penalty period (forty-six months in our example) up to sixty months.
Under the new rules, the primary residence remains exempt, unless sold, regardless of the value of the residence. The asset cap, in addition to the home, is the current CSRA (community spousal resource allowance) used by Medicaid of $123,600 for 2018 with an annual COLA to match the annual percentage increase for Social Security.
This latest move by the VA is likely to become a trend of tightening eligibility and lowering benefits for entitlement programs.
It has never been more important for seniors to plan in advance to protect their assets.
If you don’t yet need care, consider divesting excess assets into an Asset Protection Trust. The sooner you move assets the better as the three-year VA look-back and the five-year Medicaid look-back begin to run only after assets are transferred out of the senior’s name. Funding an asset protection trust prior to thirty-six months of application will avoid the new VA look back rule and start the clock running on the current five-year Medicaid look-back.