Veterans and their spouses seeking benefits for in-home care, assisted living or nursing home expenses through the Department of Veterans Affairs (VA) are facing new eligibility requirements.
The changes to VA Aid and Attendance (A&A) eligibility, which went into effect in October, affect how the government calculates a veteran’s net worth and the maximum net worth allowed to qualify for benefits. Here’s what you need to know and how the new requirements may affect you and your family.
- Changes to maximum net worth. The new maximum net worth a veteran can have is $123,600, the equivalent of Medicaid’s Community Spouse Resource Allowance (CSRA). This amount will be adjusted annually for inflation. The amount may differ between states, however: Illinois’ current CSRA is $109,560.
- Determining your net worth. Under the new rules, your net worth now includes annual gross income as well as countable assets. That includes anything that is or can be liquidated, such as cash, savings accounts, and certain properties and vehicles.
- Exemptions from net worth. A homestead (primary residence) of up to two acres is not included in your eligible net worth. Residential lots exceeding two acres can be excluded if the additional acreage is deemed unmarketable by an independent third party. The VA also won’t count “personal effects suitable for and consistent with a reasonable mode of life” when calculating net worth.
- Selling your residence. If you sell your home, the sale proceeds will be considered an asset and may affect your eligibility, unless you use the proceeds to purchase another residence during the same calendar year as the sale.
- Look-back period. The VA has also instituted a new 36-month look-back period. Applicants who transfer any covered assets – countable and income – for less than fair market value three years prior to the A&A application are subject to a penalty period, during which they’re ineligible for coverage. The length of this period is determined in months by dividing the amount transferred by the applicable maximum pension rate. You can potentially avoid the penalty if you can prove the transfer was not made in an effort to qualify for A&A benefits. The VA also won’t count asset transfers that happened before October, when the new rule became final.
We know this stuff is complicated, but we deal with it all day, every day. We get how it works and can help you or your loved one maximize your benefits by guiding you through the eligibility process. It’s all a part of having a quality estate plan. If you’re a veteran, the spouse of a veteran or are curious about your veteran parent’s eligibility, contact our office to get started.