Ever heard of Aid and Attendance? This best-kept secret of the Department of Veterans Affairs is a little-known benefit that makes all the difference in long-term care planning and peace of mind.
Just as the name indicates, A&A is a non-service connected, tax-free lifetime pension for veterans and their surviving spouses who require the aid and attendance of another person to manage their daily living.
Most veterans or their families don’t even know they’re entitled to a monthly income to help pay for the overwhelming cost of senior care. Additionally, A&A is the only veterans benefit that’s extended to a spouse. Let’s dive in.
Aid and Attendance is also referred to as the A&A benefit, improved pension, VA assisted-living benefit, or veterans elder care benefit. Nevertheless, these interchangeable names all describe the same benefit.
A&A can be used for assisted living, home health care, adult day care, memory care, or a nursing home. This includes paying a family member who’s the caregiver of a veteran, with the exception of a spouse. Note: The housebound allowance is unrelated to A&A and is a completely separate benefit.
When referring to A&A, most people assume it’s about pensions, which isn’t the case. A&A is a medical rating and an additional amount of money available with all VA disability income benefits to help veterans cope with the added burden of helplessness.
As with any government program, A&A has a few layers of qualifications consisting of service requirements, medical necessity, and financial eligibility. If the applicant is the spouse or surviving spouse who hasn’t remarried, the qualifications apply to both the deceased veteran and the applicant, who must satisfy additional requirements of their own. These may seem like a lot, but they’re not as cumbersome as they appear.
To begin, a veteran must have been on active duty during any of the following dates:
Veterans must have an honorable or general discharge or apply for a discharge upgrade.
Next, the veteran must be receiving the basic VA pension, or an application for it can be submitted with the A&A application. To qualify for the VA basic pension, you must meet one of the following criteria:
Veterans of the reserves who weren’t called to active duty aren’t eligible for A&A. Even though you completed active-duty training, it doesn’t count for A&A eligibility.
Once the service, discharge status, and basic pension are cleared, then the meat of the A&A eligibility can be assessed. The clinical criteria are straightforward and requires only one of these requirements:
The financials are usually evaluated last. Veterans don’t need to be destitute to be awarded A&A.
The VA enacted a ceiling for the combination of a veteran’s net worth and income that excludes the primary residence, vehicle, and personal belongings. There’s also a three-year lookback period to examine if any assets were gifted to reduce net worth or were sold below market value, both of which might affect eligibility.
For income, what’s called countable income is offset by deducting unreimbursed medical bills, prescriptions, Medicare, or private health insurance premiums and deductibles, to name a few. There’s an extensive list of expenses of allowable deductions to reduce the countable income.
Currently, the combined limit, which is comprised of net worth and income, is set at $138,489, though it changes annually.
Note: It’s possible to have $138,489 in assets alone and still qualify. For example, let’s say you have $138,489 in assets; however, your income is $5,500, and the expenses are $5,800, leaving a negative net income. In that case, you’d still qualify financially.
As mentioned earlier, payments to a family caretaker, including children and grandchildren, can be deducted from the veteran’s or the surviving spouse’s income. Applicants can then receive an increased pension equal to the amount they’ve paid to their family member who provided care.
Unfortunately, this doesn’t work for the veteran’s spouse because joint income is calculated as household income. Therefore, the salary received by the spouse would be included as their household income and wouldn’t be considered a deductible care expense.
There are many strategies to legitimately cure being over-resourced. One way is to convert countable assets into noncountable assets.
Let’s say you have $300,000 in countable assets or are over-resourced by $161,511. To bring assets below the limit, you could:
The A&A program is a lifesaver for most veterans and their families; however, it’s important to be aware of potential conflicts between VA pensions and assistance from other government programs. Depending on the individual circumstances, applying for A&A could backfire.
Veterans can’t receive both A&A and VA disability payments; instead, they’d receive the higher benefit of the two, if they qualified.
A veteran’s surviving spouse receiving dependency and indemnity compensation who’s no longer able to independently manage their everyday living can qualify for additional assistance under A&A. That said, a surviving spouse can’t receive both DIC and a death pension. Note: DIC rates are determined by the deceased veteran’s pay grade if they passed prior to 1993.
Any recipient of VA pensions may be disqualified from Medicaid benefits. Often, the income from A&A will exceed the maximum allowable monthly income to receive Medicaid assistance.
Unfortunately, the application process can be quite lengthy, spanning anywhere from 9-12 months. Filing an intent-to-file document at the beginning of the application process establishes the start date that would pay retroactively if your claim is approved. If you’re considering an application for A&A, it’s a good idea to submit the intent to file form 21-0966 right away.
Once your claim is approved, benefits are paid in a lump sum from the effective date locked in on the intent to file. In some cases, veterans’ families have taken out a loan to cover the cost of care while waiting on the application process, thus allowing an accelerated repayment when the application is approved and the benefit payments begin.
For many families, the A&A benefit provides an increased buying power, which opens up more options in choosing a senior living community that best fits the veteran’s needs. More importantly, it gives the veteran the ability to remain in the community much longer than their original budget may have otherwise allowed.
The coveted peace of mind in caring for a loved one just might be the best benefit of Aid and Attendance.
