Improving The Quality Of Life  For Wartime Veterans

Improving The Quality Of Life For Wartime Veterans

There is a noteworthy benefit available for veterans to subsidize the cost of care as they age, but the majority of veterans do not know about the benefit or believe they do not qualify. Due to a lack of knowledge and information, many veterans miss out on what could be hundreds of thousands of dollars to help finance the increasingly expensive cost of custodial care. When a veteran or surviving spouse is able to take advantage of this benefit, the additional money can be used to pay for the care required to improve that person’s quality of life and keep the veteran or spouse safe.

VA Pension / VA Aid and Attendance

In 1952, Congress passed Title 38 of the United States Code authorizing specific benefits for veterans (Veterans’ Benefits, 1952). The Veterans Aid and Attendance pension was established by that law. It provides a monthly benefit, or pension, for qualified veterans and survivors. Veterans who need help (aid and assistance) with daily activities and those who are homebound may qualify. The benefit is unusual in that it does not require the veteran to have an injury that occurred while on active duty like many other benefits for service veterans. As a result, many veterans have not pursued this benefit, believing they would not qualify.

The Veterans Aid and Attendance pension have been available for decades, but the requirements can be confusing, sometimes leading to the rejection of applicants who actually qualify. When an applicant misunderstands the requirements and unintentionally

misrepresents his/her net worth on the application, the U.S. Department of Veterans Affairs (VA) charges a penalty period when the claimant is disqualified for the benefit. Applicants frequently err in calculating their income because they neglect to deduct the appropriate medical expenses. Another land mine in the application process results from an applicant transferring assets for less than fair market value within three years of applying for the benefit.

The most frequent blunder after an applicant has been qualified for the benefit occurs when the primary residence is sold. Because the primary residence is exempt in the initial calculations, many applicants erroneously believe it is exempt even when it is sold. Considering this benefit can be life-changing for eligible veterans and surviving spouses, advocates for older adults will benefit from becoming familiar with the nuances of qualifying for it.

Amount of the Benefit

The amount of the Aid and Assistance pension is significant enough to drastically change the quality of life for a recipient. A married veteran is eligible to receive up to $2,266 per month or $27,192 annually. A single veteran is eligible for $1,911 per month. A surviving spouse of a qualified veteran is eligible for $1,228 per month (U.S. Department of Veterans Affairs, 2020). An additional perk is that the benefit amount is tax-free. To compare, the average Social Security benefit for retired workers in May 2019 was only $1,412. (Yockim, 2018). An extra $1,911 per month can make the difference between trying to survive in an unsafe situation with inadequate care, to receiving the required care in a comfortable, safe environment.

Requirements for Eligibility

The qualifications for the benefit are dependent on a three-pronged test. The first factor is based on the veteran’s service record. The second factor is determined by the reasonably predictable unreimbursed annual medical expenses the veteran or surviving spouse is paying, and the third factor hinges on the veteran’s net worth. Each of these factors requires more detail for clarity.


The dates the veteran served our country and the type of discharge are required to answer the first factor. The veteran must have served ninety consecutive days with at least one day of that service occurring during wartime (Veterans of a Period of War, 2012). That qualification brings up the question of what is considered wartime service. For instance, during the conflict, Vietnam was not considered to be a war. Nonetheless, Congress has subsequently defined the following dates as official wartimes:

  • World War II: December 7, 1941 – December 31, 1946
  • Korean War: June 27, 1950 – January 31, 1955
  • Vietnam War (in Vietnam only): February 28, 1961 – August 4, 1964; (any location): August 5, 1964 – May 7, 1975
  • Gulf War: August 2, 1990 – End date not yet set, but for benefit purposes the war is ongoing.
  • Note that during the early years of the Vietnam War, from February 28, 1961 to August 4, 1964, the veteran had to actually be in Vietnam to meet the requirement of the first factor for the Aid and Attendance benefit. During all of the other wartime, including the later years of the Vietnam War, the veteran is not required to have been in battle or in a country where the fighting was occurring.

For example, one veteran who qualified for the VA Aid and Attendance pension played in a service orchestra during the Korean War. He spent his entire military career in the U.S. and was spared the horrors of the actual fighting. However, he was on active duty ninety consecutive days with several days occurring during the Korean War, and therefore, he meets the service date requirement.

The next part of the veteran’s service that has to be examined is the type of discharge the veteran was granted. While there are many different types of dis- charges, as long as the veteran did not receive a dis- honorable discharge or a discharge for bad conduct, the threshold is met.


The applicant must require assistance with at least two activities of daily living to qualify for Aid and Attendance. Activities of daily living for VA purposes include bathing, dressing, toileting (including incontinence), eating, transferring from a bed to a wheelchair, and moving around the person’s living area. Veterans may not realize they qualify for assistance. For example, needing a reminder to pick out clothes meets the bar, and so does needing stand-by assistance for bathing in case of a fall (Pool, 2017). Applicants confined to bed can also qualify for the benefit (U.S. Department of Veterans Affairs, 2020).

Veterans also meet the standard if:

  • They are in a nursing home due to mental or physical incapacity.
  • They have corrected visual acuity of 5/200 or less in both eyes.
  • They have a concentric contraction of the visual field to 5 degrees or less.

A physician must sign a form to validate the applicant requires the qualifying assistance.

Once a medical need has been established, all predictable, unreimbursed medical expenses can be included in the cost of care for the applicant (Criteria for Determining Need, 2018). Not all medical expenses are deductible; only the reasonably predictable unreimbursed annual medical expenses include the cost of assisted living, a home caregiver, Medicare premium, Medicare supplement premium, prescription medications, medical devices, etc. (Deductible Medical Expenses, 2018).


Determining eligibility for the third factor, the amount of the veteran’s net worth is more complex. If a veteran is married, the veteran and the spouse’s assets are jointly considered when calculating the amount of net worth. For 2020, the maximum amount of assets a veteran, married or single, or a surviving spouse may have is $129,094. This amount is adjusted annually for inflation.

The VA’s net worth calculation is different from the usual calculation of net worth in that the VA counts assets plus annual income. Annual income includes Social Security, other pensions, annuity payments, interest earned, dividends earned, withdrawals from individual retirement accounts (IRAs), 401(k) withdrawals, VA disability payments, and most other sources of money a veteran or surviving spouse receives on an annual basis (How VA determines the Asset Amount, 2018).

However, applicants should reduce the annual income gross total by the amount the applicant is paying for reasonably predictable unreimbursed annual medical expenses to arrive at the correct number.

For example, a veteran has a total annual income of $25,000. The veteran lives in an assisted living community where he pays $48,000 per year. When the cost of the veteran’s care is subtracted from his total annual income ($25,000 minus $48,000), the result is a negative number. Declaring a negative annual income number is not allowed by the VA, so this veteran’s total annual income is considered to be zero. Another example is a veteran with the same total annual income of $25,000 paying for a caregiver at home, which costs $15,000 annually. The annual cost of care is subtracted from the annual gross income ($25,000 minus $15,000). The total annual reportable income for the veteran is now $10,000.

After ascertaining the income of the veteran, the next step for the third factor is to calculate assets. Assets are all items owned by the veteran, such as a home, bank accounts, stocks, and bonds, etc. Their fair market value, or worth, is what a willing buyer would pay a willing seller for the item. The VA uses a variety of available information to determine fair market value: inspections, appraisals, public records, recent sales of similar property, etc. If the claimant has the ability to liquidate the entire balance of an annuity, IRA, 401(k), trust, or other financial instruments, the total value of the asset is included in the net worth calculation.

For example, how would the VA calculate the net worth for a veteran with an annual income of $25,000, $15,000 in annual home care costs, plus assets worth $135,000? The $15,000 would be subtracted from the $25,000 of income to equal a $10,000 balance of income. The balance of income is added to the $135,000 of assets for a total net worth of $145,000. The VA would deny the claim for Aid and Attendance pension because the net worth exceeds the maximum of $129,094. The claimant could spend the difference between the $145,000 and $129,094 on living expenses or medical expenses, then reapply for the benefit when the net worth is reduced to $129,094 or below.

Another example is a claimant who has $25,000 in annual income, $48,000 in deductible medical expenses, and assets of $129,094. This claimant would be eligible for the pension because the $48,000 would be subtracted from the $25,000, which would bring the annual income to zero (remember the VA does not allow a negative income number). Then, zero plus $129,094 is right at the maximum net worth limit for qualifying.

To add even more complexity to this third-factor calculation, the VA allows an exemption for a claim- ant’s primary residence when it is a  single-family unit with two acres or less of land. Additionally, the personal items of the claimant are also exempt. This includes all of the customary items in the home: dishes, furniture, and clothes, plus a vehicle for family transportation (Statutory Exclusion from Income or Assets, 2018).

Benefits for Spouses

The surviving spouse of a qualifying veteran is also eligible for this benefit when the couple did not divorce, the spouse has not remarried after the veteran’s death, and the surviving spouse meets the other requirements for eligibility. Usually, the couple needs to have been married for at least a year. For example, Betty was married to John when he died. John qualified for the Aid and Attendance benefit from a service perspective but never needed care while he was alive, so he never applied for the benefit. Betty never remarried, but later in life, she did require the care available in an assisted living community. When she moved into assisted living, she met the Aid and Attendance requirements for the medical expenses, and her net worth was under the maximum allowable. Betty applied for, and was approved to receive, the benefit as a surviving spouse.

Penalty period

When an applicant is over the maximum net worth limit and transfers assets for less than fair market value in an attempt to qualify for the benefit, the applicant will be subjected to a penalty period. A penalty period is a measure of time when the VA will not pay the pension because of an unauthorized transfer of assets. The VA reviews all transfers within the 36-month period prior to the application to validate that no transfer of assets has occurred for less than fair market value (Asset Transfers and Penalty Periods, 2018).

Here’s an example. The applicant gave a child $15,000 in May of 2018 as a gift in accordance with IRS regulations. In August of 2018, the applicant applies for the Aid and Attendance pension with a net worth of $120,000. When the VA discovers the gift for $15,000 and adds that to the applicant’s current net worth of $120,000, it brings the adjusted net worth up to $135,000 and disqualifies the applicant from the pension. Even though the IRS allows an annual gift to family members, the VA invokes a penalty period for that same gift.

Calculation of Penalty Period

The penalty period begins on the first day of the month following the date of the transfer. In the previous example, the applicant gave the child $15,000 in May of 2018. Therefore, the penalty period begins on June 1, 2018.

The penalty is calculated by dividing the value of the asset transferred (in our example, $15,000) by the monthly penalty rate (currently $2,266), and rounding down. When $15,000 is divided by $2266, the result is 6.62. When that is rounded down to 6, that is the number of months the VA will not pay the Aid and Attendance pension. The benefits will start on the first day of the month following the penalty period, or in this case December 1, 2018 (Asset Transfers and Penalty Periods, 2018). The monthly penalty rate is the same for any claimant regardless of whether that is a single veteran, married veteran, or surviving spouse.

Proceed with Caution When Selling a Home

While a primary residence is excluded from the original net worth calculation, an applicant needs to be cautious if the primary residence is sold. If, after qualifying for the VA Aid and Attendance pension, the claimant sells the primary residence, the net proceeds are considered an asset unless the proceeds are used to purchase a different primary residence within the same calendar year. Frequently, a veteran will qualify for the benefit, then subsequently decide to move into an assisted living community when the cost of home care becomes too expensive. Here’s where that gets tricky.

At that point, the veteran will typically sell the primary residence in order to use the proceeds to pay for the assisted living community. However, when the residence is sold and changed from an exempt asset to a non-exempt asset, the sale will commonly result in the applicant being disqualified for the VA Aid and Attendance pension. For example, if a qualified recipient of the pension has a total net worth of $95,000 and receives proceeds of $100,000 from the sale of the primary residence, then the updated net worth would be $195,000. That is over the maximum of $129,094 and, therefore, disqualifies the recipient for the benefit until the net worth is below the maximum.

Applying for the VA Aid and Attendance Pension

While this pension can improve the standard of living for the beneficiaries, the path to an approved application can be precarious. The VA is overworked, understaffed, and in high demand. The typical time between the application submission and the approval can be six to twelve months. This is not a do-it-yourself type of job. An applicant would be prudent to seek the advice of a VA Accredited Attorney to ensure everything is done correctly the first time around. If by chance, a veteran completes the application incorrectly, the veteran will receive a denial letter without any explanation.


Men and women have risked their lives protecting our freedom. As a token of appreciation, legislators have authorized the use of taxpayer dollars to support veterans as they age and require custodial care. Unfortunately, many veterans who have earned the Aid and Attendance benefit do not know the benefit exists or are confused about how to qualify for it. When people working with older veterans help them to understand and qualify for the benefit, the increased amount of money frequently improves their quality of life and level of care. Who is more deserving of a better quality of life than the men and women who have improved life for all of us?

At Nelson Elder Care Law we helped more than 2,000 families to protect their life savings and pay for care as they age while maintaining their independence and dignity. The firm has been recognized as #42 on the Law Firm 500 and by the local Chamber of Commerce for customer excellence. We can be reached at (678) 250-9355.

We’ll publish next a Case Study on Improving The Quality Of Life For Wartime Veterans. Make sure to read it for a real-life scenario that will give you an in-depth example of a possible situation.

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