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Under the right circumstances, a little-known federal program will pay additional income to cover long term care costs for at least 1/3 of all U.S. households with a person 65 years of age or older.  But the provisions of this program are such a well-kept secret that less than 5% of eligible seniors are actually receiving the benefit. The great news about this program is the government will pay you to hire your family, friends or just about anyone to help take care of you. The program is called "VA Pension."

Life Care Planning, Estate Protection, Disability,
VA & Medicaid Assistance Lawyers

Hidden Government Program Pays the Cost of Home Care

What if you heard that 33% of all seniors in this country could receive up to $1,800 a month in additional income from the government to cover their long term care costs? Would you believe it?

 

Under the right circumstances, a little-known federal program will pay additional income to cover long term care costs for at least 1/3 of all U.S. households with a person 65 years of age or older.  But the provisions of this program are such a well-kept secret that less than 5% of eligible seniors are actually receiving the benefit. The great news about this program is the government will pay you to hire your family, friends or just about anyone to help take care of you. The program is called "VA Pension."

 

Some people may have heard about the Pension benefit; they may know that it will cover the costs of assisted living and, in some cases, cover nursing home costs as well. But the majority of those receiving long term care in this country are still residing in their homes.  Estimates are that approximately 70% to 80% of all long term care is being provided in the home - much of it by uncompensated family members.  All of the information generally available about Pension overlooks the fact that this benefit could be used to pay for home care.

 

It also may come as a surprise to most people that VA will allow veterans' households to include the annual cost of paying any person - such as family members, friends or hired help - for care when calculating the Pension benefit. This annual cost is deducted from household income and used to calculate a lower "countable income" which in turn enables families to receive this extra income from VA.  Even though VA claims the benefit is for low income families, because of the deduction for care costs, households earning between $3,000 and $6,000 a month can still qualify for a Pension.

 

This extra income can be a welcome benefit for families struggling to provide care for loved ones at home.  Under the right circumstances, payments for care made to family members, friends or any other person providing care, could create an additional household income of up to $976 a month for a single surviving spouse of a veteran, up to $1,520 a month for a single veteran or up to $1,800 a month for a couple.

 

The pension benefit is available to veterans or their surviving spouse - if the veteran served at least 90 days, with at least one day during war time, and was honorably discharged. The veteran does not have to have a service-related disability to qualify.

 

If the disabled care recipient has been rated "housebound" or in need of "aid and attendance" by VA, all fees paid to an in-home attendant will be allowed as long as the attendant provides some medical or nursing services for the disabled person. The attendant does not have to be a licensed health care professional. There is also no need to distinguish between medical and non-medical services - all are deductible.

 

Examples of medical or nursing services would be help with everyday activities (called activities of daily living) such as dressing, bathing, toileting, ambulating, feeding, or going to the bathroom. This includes individuals who are living at home, as well as those who are bedridden, blind, or residing in a care facility.  Other services might include medication reminders or supervision necessary to provide a protective environment for the care recipient - in the case of dementia or Alzheimer's.

 

For a disabled person who has been rated, a family member will be considered an in-home attendant, but that family member has to actually be paid for the services.   Documentation for the care must be provided to VA, and it is reasonable for VA to question whether the services being purchased from a family member living in the household are legitimate.  Such arrangements should be extensively documented and completely at arm's-length.

 

The care arrangements should be set forth in a formal written contract or agreement signed in advance.  In addition, there must be evidence, such as a letter from a physician, that this care is needed on an ongoing and regular basis.  There should be weekly or bi-weekly invoice billing for the care services, and payment for the care must actually be made prior to application.  In other words, money must exchange hands and there must be evidence of this, e.g. copies of checks and bank statements.  In addition, the care provider will need to report the income received on his or her income tax return.  All of this documentation must be provided as proof to VA when making application for the pension benefit.  Finally, costs for these services must be unreimbursed - meaning these costs are not paid by insurance, by contributions from the family or from other sources.

 

How it works. The amount a person receives depends on his or her income. The VA pays the difference between the veteran's income and the Maximum Annual Pension Rate (MAPR). John, a single veteran, has income from Social Security of $16,500 a year and a pension of $12,000 a year, so his total income is $28,500 a year. He pays $20,000 a year for home health care, $1,122 a year for Medicare Part B, and $1,788 a year for supplemental health insurance.  None of these costs are paid or reimbursed by Medicare or any other source.  So his total uncompensated medical expenses are $22,910.  Subtracting his uncompensated medical expenses from his gross income ($28,500 - $22,910), John's countable income for VA purposes (IVAP) is $5,590.  John could qualify for $12,644 ($18,234 - $5,590) in Aid and Attendance Pension benefits.

 

Richard Habiger is an elder law, VA benefits, and special needs planning attorney.  You may contact him at 618-549-4529 or Richard@HabigerElderLaw.com.

 

 


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Toll Free: 800-336-4529

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Phone: (618) 985-4529