The Department of Veterans Affairs (VA) appears to have finally amended its regulations governing veterans’ eligibility for VA pensions and other needs-based benefit programs. The amended regulations establish new requirements for evaluating net worth and asset transfers for pensions and identify which medical expenses may be deducted from countable income for VA’s needs-based benefit programs.   This rule is effective October 18, 2018 despite some commentators indicating that the rule takes effect today, September 18.

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In a notice of proposed rulemaking published in the Federal Register on January 23, 2015 (80 FR 3840), VA proposed to amend its adjudication regulations governing its needs-based pension benefit for wartime veterans and for surviving spouses and children of wartime veterans, as well as its adjudication regulations governing its older pension programs and parents’ dependency and indemnity compensation (DIC).  Under the current pension statutes, pension is a benefit in which the annual amount of the benefit is reduced dollar-for-dollar by annual income received. See 38 U.S.C. 1521, 1541, and 1542. VA calculates annual income by deducting or excluding (not counting) amounts noted in 38 U.S.C. 1503 and other applicable statutes, such as a portion of unreimbursed medical expenses and educational expenses.

Some of the changes which will be going into effect regarding the Veterans Aid and Attendance benefit include:

• Setting the net worth limit at the maximum CSRA for Medicaid—which in 2018 is $123,600;
• VA’s treatment of a claimant’s residence for asset calculation purposes defines “residential lot area” to mean the lot on which a residence sits not to exceed 2 acres (87,120 square feet), unless the additional acreage is not marketable.  Additionally, if the residence is sold, any proceeds from the sale is an asset except to the extent the proceeds are used to purchase another residence within the same calendar year as the year in which the sale occurred;
• Establish a 36-month “look-back” period and a penalty period not to exceed 5 years for those who transfer assets during this look-back period to qualify for pension. The new rule also states that a transfer for less than fair market value means a voluntary asset transfer to, or purchase of, any financial instrument or investment that reduces net worth below the established threshold by transferring the asset to, or purchasing, the instrument or investment unless the claimant establishes that he or she has the ability to liquidate the entire balance of the asset for the claimant’s own benefit (i.e. certain trusts and annuities); however, excluding mandatory conversions.  VA will not review asset transfers that occurred before the effective date of this final rule.

These constitute some of the major changes to the existing regulations.  There are other details that are important in filing a claim for A&A; however, we thought you should have some basic understanding of the rule changes immediately.

If you have any questions regarding VA or Medicaid, call the experienced attorneys at Bratton Law Group for an appointment at 856 770 2744.

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