Although the Veterans Administration calls it a “Pension” Plan, this program is actually more similar to a needs based program, such as Medicaid and Supplemental Security Income.  The reason for this is because the Veterans’ Pension Plan has financial eligibility requirements, just like those programs do.  For those who do qualify, however, the benefits received can be a very useful source for paying the costs of long term care.

In order to be eligible for VA Pension Benefits a veteran must show that he or she:

• Was discharged from service under other than dishonorable conditions, and
• Served 90 days or more of active duty with at least 1-day of war time, and
• Had countable income and net worth below the established thresholds, and
• Is permanently and totally disabled, or
• Is age 65 or older

A dependent of a deceased wartime veteran is eligible to receive VA Pension benefits if he or she can prove very similar criteria.

If the applicant has met the war time service requirement then the Veterans Administration will look at his or her net worth.  The VA will not provide benefits if it determines that the applicant has sufficient resources to provide for his or her needs without VA assistance.  While there is no hard and fast dollar amount that will trigger the denial of benefits, VA caseworkers are required to conduct a formal administrative decision if the net worth exceeds $80,000.  It is unlikely that the VA will issue a denial if the applicant’s net worth is less than $80,000.

It should be noted that in making its determination, the Veterans Administration will also include the net worth of the applicant’s spouse.  However, household objects and possessions, motor vehicles used for transportation and the principal residence are not included in making the net worth determination.

Unlike the situation confronting those applying for Medical Assistance (Medicaid), the Veterans Administration does not look back to see if and when an applicant transferred assets prior to applying.  However, the VA will not consider assets to have been transferred (i.e., they are considered to still be in the possession of the applicant) if the transfer was made to someone in the household.  Furthermore, if the transfer was made to someone outside the household, the claimant must show that he or she has relinquished control of the asset.

Finally, the last requirement that an applicant must meet in order to be eligible for VA Pension Benefits is the income requirement.  In making this determination, the VA will first look at the applicant’s “maximum annual pension rate” (MAPR).  The MAPR is based on the applicant’s filing status (such as whether he or she is a veteran, surviving spouse or child), whether the applicant is eligible for housebound or aid and attendance (A & A) benefits and the number of dependants the applicant has.

The VA will then calculate the applicant’s countable income (IVAP).  This figure represents the applicant’s income projected over 12 months.  The difference between the claimant’s income (IVAP) and the MAPR is the amount of benefits that he or she is entitled to.  It is important to keep in mind that non reimbursed medical expenses are subtracted from the income figure in order to arrive at the applicant’s IVAP.

Here is an example: A veteran is determined to be sufficiently disabled that he is eligible for aid and attendance benefits is married and earns $25,000 a year and will have $18,000 in unreimbursed medical expenses (such has assisted living costs and home health costs).  His maximum allowable pension rate (MAPR) by law is $23,396.  The applicant’s IVAP is $7,000 (25,000-18,000).  Therefore he is entitled to $16,396 of VA pension benefits to be paid out over 12 months, or a monthly payment of $1,366.

Obviously, the determinations as to an applicant’s eligibility and the amount to which he or she is entitled can be very complicated.  Notwithstanding the complexities involved all veterans who have served within the Veterans Administration’s defined war time periods should look into whether they can receive this earned benefit.  These veterans should contact the Department of Military and Veterans Affairs (215-345-3307 in Bucks County, 610-278-3285 in Montgomery County) or a qualified Elder Law Attorney.