Sunday, November 20, 2011
Paying for Long-term Care: VA Benefits for Surviving Spouses
When she was approaching her 85th birthday, Sarah began to worry. Until that time, she believed she had plenty of money to last through her lifetime. Now, she saw her life’s savings slipping away.
It started when she realized she was forgetting things. First, she forgot to pay her utilities, and didn’t realize it until the power company threatened to turn off her power. Next, she was driving to the grocery store and forgot how to get back home. After that nice young man called her son to ask him where Sarah lived so he could help her get home, her son demanded that she give up her car keys. Once she gave up the car keys, she had to hire someone to take her to the grocery store and to the doctor. When she burned the soup on the stove, her family made her hire a caregiver to come in for eight hours every day. Sarah’s family was now talking about moving her into an assisted living facility so that she could be safe at night.
For the first time in her life, Sarah was spending more than her income every single month. She was dipping into her savings each month to pay the caregiver, and that scared her.
VA “Death Pension” for Surviving Spouses
When Sarah and her children came to see me, I told them that Sarah, the widow of a World War II veteran, could qualify for a Veteran’s Pension for surviving spouses – called a “Death Pension.” In 2012, when the VA makes a cost of living adjustment, the Death Pension can pay up to $1094.00 each month to the surviving spouse of a veteran who served during wartime.
The requirements for the Death Pension are that the veteran had to have served for 90 days on active duty, one day of which was during a declared war. The veteran had to have been discharged with an honorable, general, or medical discharge. The surviving spouse must have been married to the veteran for at least one year preceding death, still married at the time of death, and not remarried after the death.
There are some asset and income limitations, too. The asset limitations are not hard and fast, and depend on each individual circumstance. For most cases, the surviving spouse must have less than about $50,000 in his or her name, not including the car, the home, and the personal property inside the home. The VA uses a life expectancy chart and considers other information, such as cost of care, to determine acceptable asset amounts, so the VA can use a different asset limit for each applicant. Although assets can be transferred to achieve eligibility, I recommend that people see an attorney before doing any transfers. Asset transfers can affect Medicaid eligibility, and improper transfers can cause serious difficulties down the road.
The Death Pension is a three level pension, and the amount a surviving spouse may be eligible for depends on the level of care required. The basic pension is available to a surviving spouse over the age of 65, who otherwise meets the income and asset limitations. In 2012, the top rate for the basic Death Pension will be about $684.00 per month.
A higher level of pension is available to someone who is classified as “Housebound”. The VA defines housebound as being substantially confined to the home or immediate premises due to a disability that will likely remain throughout the claimant’s lifetime. In 2012, a surviving spouse with no dependent children who is housebound is eligible for benefits of up to $837 per month.
The highest level of pension, referred to as Aid and Attendance, is available when a surviving spouse requires the assistance of another person to perform activities of daily living, or is blind or nearly so, or is a patient in a nursing home. That monthly rate in 2012 will be about $1094.00.
Income Limitations
Income limitations apply, but the definition of income for VA purposes is all of the income received by the person applying for the benefit, minus recurring unreimbursed medical expenses. In Sarah’s case, her only income was her monthly Social Security plus a little bit of interest income she received on her savings. Every month, Sarah was spending her entire Social Security check, plus some of her savings, to pay for a caregiver to come into the home. So, for VA purposes Sarah had no income and, based on the fact that she now needed the assistance of another person on a regular basis, Sarah could qualify for the highest level of the Death Pension.
If Sarah decides to move into an assisted living facility, the cost of that facility will be considered an unreimbursed medical expense, too.
The process of applying for benefits can be daunting, and a decision from the VA can take quite a few months. However, once an application is filed, if the applicant is qualified, the benefit will be retroactive to the first day of the month following the application and the surviving spouse can get a lump sum for all of the months it has taken the VA to make that decision.
Sarah was relieved to know about the VA benefit and that $1094.00 each month will allow her to pay for homecare for a while longer, until she decides whether she wants to go into an assisted living. Then, that money, along with her social security, will allow her to choose a good and safe facility.