Qualify Financially or Not?

Discussion in 'Eligibility Questions' started by 442 WW2 Vet, Mar 1, 2017.

  1. 442 WW2 Vet

    442 WW2 Vet Newbie

    My dad who is 93 years old, and a WW2 vet, is in a assisted living facility. I want to apply for A & A, but before I do all the work/research, I want to know about the Determining Countable Income. Specifically the $80,000 threshold. On the "How to Apply for Aid & Attendance" section, it states, "An applicant must have on average less than $80,000 in assets, but on another section (Determining Countable income) it's stated "As a rule of thumb, assets should not exceed $80,000". That amount drops depending on age of claimant.
    My dad is 93, so how much does it drop? Is there a age where there is no dollar threshold? Can I include my mothers independent living costs along with my fathers?
     
  2. Jandy

    Jandy Jr. Member

    Hi 442 WW2 Vet,
    The $80,000 asset limit (excluding primary home and vehicles) is not a bright-line threshold, just a general rule of thumb. In looking at an applicant's assets, the VA asks themselves (undoubtedly with some sort of actuarial support), how likely it is that the applicant will run through their assets under the circumstances. If the applicant is NOT likely to do so, the VA is less likely to approve benefits. This is where the age of the applicant is obviously important. A 70 year old applicant is more likely to outlive his assets than a 90 year old with the same amount of assets because, statistically, he has more years in front of him.

    HOWEVER note this: if the applicant's monthly care expenses are so high that his assets are rapidly depleted (for example, he has to heavily tap his assets every month to pay a high ALF bill), then that modifies the age considerations above. For example, an 80 year old applicant who has to use $3000 of his assets to pay his ALF bill every month might be regarded by the VA on the same footing as a 70 year old applicant with the same asset amount who only has to take $1000 from his assets. [Please note these numbers are for illustration only].

    As you can imagine then, there's no definite, exact dollar answer to the question "what is the asset limit?" It is a fact-dependent question, depending on the age of the applicant, his/her life expectancy, and monthly care expenses.

    As to your last question about the independent living costs of your mother. Someone else please clarify, but I believe(?) the VA has made it harder to count the costs of independent living facilities as an unreimbursed medical expense that you can deduct from your income. I think it hinges on whether the facility provides "custodial care" (assisting with 2 or more activities of daily living).....I did not encounter this issue with my father's application, so please--someone else jump in if I'm wrong here.
     
    Last edited: Mar 15, 2017
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  3. Kaylin

    Kaylin Hero Member Staff Member

    Jandy is absolutely right about the asset level. Thanks for explaining that! As for the independent living, it is harder to get approved for A&A with independent living. Like Jandy said you have to show the need for a caregiver to come in and help the veteran or spouse with some activities of daily living regularly. If the applicant lives in independent living but has a caregiver come in regularly than they could qualify.
     
  4. VA Legal Team

    VA Legal Team Full Member

    Interestingly, there is a VA Form called Corpus of Estate Determination. However, this form isn't actually found on the VA website. On this form, the VA takes the monthly shortfall and then multiples by 12 to get the annual shortfall. They then divide net worth by the annual shortfall. Once they have this number, the VA compares it to life expectancy. If the VA determines that net worth divided by annual shortfall is greater than life expectancy, then they definitely deny for net worth. The grey are comes into play when net worth divided by shortfall is less than life expectancy. As you say, in this situation, there doesn't appear to be a bright line number.

    My opinion is that the new ILF rules make it easier to qualify. Before, there was not a clear definition for when an ILF resident could count their room and board as a medical expense. The new rules establish clear guidelines that the VA follows.
     
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  5. Tory Davis

    Tory Davis Newbie

    I'm assisting my Grandmother apply for Death Pension/A&A and have a similar question as 442 WW2 Vet... she resides in an ALF and pays approximately $3,100/mo with Social Security Income of $11,000/yr. She sold her home last year before moving into the VLF and netted $130,000, which sits in a savings account at the moment, and additionally has a $69,000 annuity. Clearly, these assets far exceed the $80,000 tentative threshold for Net Worth, however, at the current rate, would spend down this net worth to zero in 7 yrs. These assets are actually in her Revocable Trust and felt it would protect her from having to claim them as part of her Net Worth, however, I've since read that they would need to be in an Irrevocable Trust to allow her not to claim those assets. In addition, I've read that the VA may be instituting a 3 yr. Look Back period this year. Any advice to the best course of action would be very welcome!!

    Thanks,
    Tory
     
  6. Jandy

    Jandy Jr. Member

    Hi Tory and welcome,
    You are correct about the proposed 3 year look back rule, but I'm not aware of a projected effective date. It's my understanding that the VA proposed the changes, there was a comment period, and now we are waiting on the final rules. I had heard that nothing would be coming before April 2017--next month--but I don't know if the change in administration has altered this.

    I should add that Medicaid definitely--right now-- has a look back rule (5 years), so that's important for many of us to keep in mind.

    I can't really advise you about the particulars of an irrevocable trust--I'm no financial expert and have no personal or family experience in the area. Also, it's my perception that this site generally does not make suggestions about restructuring assets in order to qualify for A&A. I believe the site tries to honor the spirit of the benefit itself: as a resource for those who cannot afford care without it.

    In any event, keep close tabs on your grandmother's expenses and resources. Once her assets are reduced to $80,000 (or another dollar limit, if the VA issues clearer rules on that), you can apply for A&A for her at that time.

    Best of luck to you!
     
    Last edited: Mar 22, 2017 at 1:29 PM
  7. Kaylin

    Kaylin Hero Member Staff Member

    Tory,
    My latest update on the 3 year lookback is we will not receive any updates on the status of it (and if it's being implemented) until at least Summer 2017.

    Jandy is right in that we do not make suggestions to restructure assets in order to qualify for A&A benefit and, in fact, we recommend you do not do so. If you ended up going with a financial advisor to restructure your assets it is seen as sort of "black hat" because they are - in a way - charging you for help in applying for the A&A benefit.

    I would recommend keeping up with the A&A benefit as much as you can and considering her costs vs. income over time to see when she might be ready to qualify.
     
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