ICLE ELDER LAW COLLEGEICLE ELDER LAW COLLEGEDECEMBER 10, 2012DECEMBER 10, 2012

OVERVIEW OF VA COMPENSATION AND OVERVIEW OF VA COMPENSATION AND PENSION and SOCIAL SECURITY PENSION and SOCIAL SECURITY

BENEFITSBENEFITS

Presented by Presented by Donald D. Vanarelli, Esq.Donald D. Vanarelli, Esq.Accredited VA AttorneyAccredited VA Attorney

Certified Elder Law Attorney Certified Elder Law Attorney Founding Member, Assn. of Special Needs Founding Member, Assn. of Special Needs

PlannersPlannersNamed to the NJ “Super Lawyer” list, 2007 - Named to the NJ “Super Lawyer” list, 2007 -

PresentPresent

Statistics on VeteransStatistics on Veterans

• Of the 25 million living veterans, approximately 3 million receive VA compensation benefits and about 320,000 receive VA pension benefits.

• About ¼ of the nation’s population – approximately 70 million people – are potentially eligible for VA benefits and services because they are veterans, family members or survivors of veterans

• Between ¼ to 1/3 of all homeless are veterans.

VA Benefits in GeneralVA Benefits in General

• Benefits provided by the Department of Veterans Affairs (VA) range from healthcare, compensation and adaptive housing grants for service-connected disabilities, needs-based pensions, education, vocational training, home loan guarantees, life insurance, and burial and memorial benefits.

• Certain VA benefits are also provided to eligible dependents and survivors of veterans.

Veterans Health Administration Veterans Health Administration (VHA)(VHA)

Purpose: To provide health care primarily for the benefit of veterans with service-connected disabilities, combat veterans, and low-income veterans.

Programs include:-- VA Hospitals (163 hospitals)-- VA Nursing Homes (137 nursing homes)-- Information Resource Centers-- Inpatient and Outpatient Clinics (850

Outpatient Clinics) -- Domiciliary, Home Health, Adult Day

Care, Residential/Respite Care Programs

Veterans Benefits Administration Veterans Benefits Administration (VBA)(VBA)

The VBA provides an integrated program of veterans benefits. The major benefits include:

-- Compensation (for service-connected disabilities)

-- Compensation for surviving spouses and dependents of deceased veterans

-- Burial Benefits-- Rehabilitation assistance -- Home Loans-- Specially-adapted housing-- Pension (for non-service

connected disabilities)

Overview of Major Disability Overview of Major Disability Benefits ProgramsBenefits Programs

• Service-Connected Compensation

Disability compensation is a monetary benefit for veterans who are disabled by an injury or disease that was incurred or aggravated during active service.

• Needs-Based Pension

Pension is a monetary benefit for veterans who (1) are disabled (not service-connected) (2) have low income and resources, and (3) served during a period of wartime.

Service-Connected Service-Connected Disability CompensationDisability Compensation

Three Requirements to Obtain Compensation:

1. Medical diagnosis of current disability

2. Evidence of in-service occurrence or aggravation of a disease or injury

3. Link or nexus between the in-service occurrence or aggravation of a disease or injury and the current disability

Compensation forCompensation forService-Connected Service-Connected

DisabilitiesDisabilities

Disability RatingDisability Rating

•Statutory ratings schedule

•Calculated based on impairment of the veteran’s civilian earning capacity resulting from the disability.

•Ratings range from 0% to 100% in 10% increments

•Monthly compensation based on this rating.

Compensation forCompensation forService-Connected DisabilitiesService-Connected Disabilities

Disability Rating ExampleDisability Rating Example

An eligible single veteran with no dependents would be eligible for compensation ranging from $127 per month, for a 10% disability, to $2,769, for a 100% disability.

In addition to basic compensation, a “special monthly compensation” with a higher compensation rate for a 100% rating may be available.

Death ClaimsDeath Claims

Dependent survivors of veterans can file claims on their own behalf in three categories: Dependency and Indemnity Compensation (DIC), Accrued Benefits, and Death Pension.

Dependent survivors of veterans include surviving spouse, surviving child, and dependent surviving parents.

Non-Service Connected Non-Service Connected Benefits:Benefits:

VA Improved Pension VA Improved Pension ProgramProgram

•Not dependent upon service–connected disability to qualify.

•Assists families who need additional monies to help care for ailing veterans who have low income and resources.

•VA’s version of SSI benefits.

•Spouse is not eligible if veteran is living.

VA Improved Pension VA Improved Pension Program:Program:

Three Tiers of BenefitsThree Tiers of Benefits

1. Low Income Pension

2. Housebound Benefits

3. Aid and Attendance Benefits

Housebound benefits and Aid and Attendance benefits are supplements paid in addition to the basic Low Income Pension to certain veterans to cover the additional costs of care for their added disabilities.

Basic Eligibility Criteria for VA Basic Eligibility Criteria for VA Improved Pension ProgramImproved Pension Program

All of the following criteria must be met before a veteran or widow(er) of a veteran can receive Improved Pension benefits:

a. The veteran must have served at least 90 days of active duty service, one day of which must have been during a wartime period;

In general, wartime is:

World War I

World War II – Dec. 7, 1941 – Dec. 31, 1946

Korean War – June 27, 1950 – Jan. 31, 1955

Vietnam War – Aug. 5, 1964 – May 7, 1975

Gulf War – August 2, 1990 through date to be set by

law by Presidential Proclamation

Basic Eligibility Criteria for VA Basic Eligibility Criteria for VA Improved Pension Program Improved Pension Program

(cont’d.)(cont’d.)

b. The veteran must have received a discharge other than dishonorable;

c. The claimant must have limited income and assets; and,

d. The claimant must be permanently and totally disabled, or be over age 65.

Excess IncomeExcess Income

Although most veterans have income that exceeds the permissible family income limits, unreimbursed medical expenses paid by the claimant may be used to reduce the claimant’s countable income. Unreimbursed medical expenses that may reduce income include: doctor’s fees, dentist’s fees, prescription glasses, Medicare premium deductions and co-payments, prescription medications, health insurance premiums, transportation to physician offices, therapy, and funeral expenses. The most beneficial unreimbursed expenses that may reduce countable income are the costs of home health care, assisted living facilities, or nursing homes.

How Much Does VA Pay?How Much Does VA Pay?

VA pays the difference between the maximum annual pension rate (MAPR), a yearly limit set by Congress, and the veteran’s countable family income. This difference is generally paid in 12 equal monthly payments rounded down to the nearest dollar.

Net Worth: StandardNet Worth: Standard

The VA considers the net worth of the individual seeking benefits, excluding the value of the person’s home, furnishings, and car. The standard as to whether a person will be eligible for benefits is whether the person has “sufficient means” to pay for his or her care.

Assets that are counted toward the “sufficient means” analysis include bank accounts, certificates of deposit, money market accounts, investment accounts, annuities, retirement accounts, life insurance cash surrender values, etc.

Planning For Planning For VA Pension EligibilityVA Pension Eligibility

• Retitle assets to joint names (joint owner not in veteran’s household)

• Gift assets (donee not in veteran’s household)

• Transfers with retained life estate not recognized

• Assets in SNT are countable

• Personal Services Contract

• Caveat: Medicaid transfer rules are different!

Look-Back Period For Look-Back Period For VA Pension EligibilityVA Pension Eligibility

• Currently, there is no look-back period.

• GAO recently recommended that Congress establish asset transfer look-back period, with associated penalties, for non-service connected pension applicants.

VA Improved Pension VA Improved Pension Program: Housebound Program: Housebound

BenefitsBenefits

Pension benefits with a Housebound supplement are available to a veteran or widow(er) of a veteran who is disabled (or over age 65), confined to the home and financially eligible.

VA Improved Pension VA Improved Pension Program:Program:

Aid and AttendanceAid and Attendance

• Available to eligible veterans and surviving spouses who require the regular attendance of a person to assist them in eating, dressing, undressing or taking care of the needs of nature.

• Also includes individuals who are blind, in a nursing home because of mental or physical incapacity.

VA Improved Pension VA Improved Pension Program:Program:

Aid and AttendanceAid and Attendance

To qualify medically, a veteran or surviving spouse must meet one of the following conditions:

1. Is bedridden, or

2. Requires the aid of another person to perform activities of daily living, or

3. Is a nursing home resident, as a result of a mental or physical incapacity, or

4. Is blind or nearly blind in both eyes.

The Medicaid EffectThe Medicaid Effect

Since both Housebound and A&A Benefits are supplements to the basic Low Income Pension, the supplemental benefits are exempt when determining the veteran’s eligibility for ALF Medicaid. Low Income pension may be exempt in determining Medicaid eligibility when UME exceed the Low Income Pension benefit amount.

The Medicaid Effect (cont.)The Medicaid Effect (cont.)

If a claimant is in a NH or ALF receiving Medicaid, the VA pension benefits payable is reduced to $90 per month.

Accreditation by the VAAccreditation by the VA

As of June 23, 2008, the VA began REQUIRING that ANYONE who assists a veteran or family member with the preparation, presentation and prosecution of a claim for benefits be accredited by and through the VA BEFORE they can legally provide assistance.

Who Can Charge Fees, and Who Can Charge Fees, and When? When?

Veterans may obtain free assistance with completing an application for benefits from accredited veteran services organizations and others who are accredited. No organization nor individual, including lawyers, can charge for the preparation, presentation, and prosecution of an initial claim. But, if a claim is denied or approved for fewer benefits than are expected, a claimant may hire and pay an accredited attorney or other accredited representative to assist with an appeal after a Notice of Disagreement has been filed. Only accredited agents and attorneys may receive fees from claimants for services provided in connection with representation.

ICLE ELDER LAW COLLEGEICLE ELDER LAW COLLEGEDECEMBER 10, 2012DECEMBER 10, 2012

SOCIAL SECURITYSOCIAL SECURITY ISSUES:ISSUES:SOCIAL SECURITY DISABILITY (SSD) SOCIAL SECURITY DISABILITY (SSD)

ANDANDSUPPLEMENTAL SECURITY INCOME SUPPLEMENTAL SECURITY INCOME

(SSI)(SSI)

““SSD” BENEFITS: AVAILABLE TO SSD” BENEFITS: AVAILABLE TO BLIND/DISABLED WORKER WHO:BLIND/DISABLED WORKER WHO:

(1) applies for benefits;

(2) has not reached full retirement age;

(3) is “insured” (SSA earnings);

(4) is disabled;

(5) has been disabled (5 months within last 17 months)

““INSURED” STATUS FOR INSURED” STATUS FOR DISABILITYDISABILITY

SSA requires an individual to have earned “insured status” through work activity at the onset of disability. “Insured Status” = (1) “fully insured” (40 quarters), and (2) current connection to the workforce (worked 5 out of the last 10 years).

““SSI” BENEFITS: AVAILABLE TOSSI” BENEFITS: AVAILABLE TO AGED, BLIND OR DISABLED AGED, BLIND OR DISABLED

WHO:WHO:

(1) applies for SSI/other benefits for which may be entitled;

(2) is U.S. resident or qualified alien;

(3) is not resident of a public institution;

(4) meets income and resource requirements; and,

(5) is not fleeing to avoid prosecution/ violating probation or parole.

““DISABILITY,” DEFINED DISABILITY,” DEFINED (ADULTS):(ADULTS):

Inability to engage in “substantial gainful activity” (SGA) based on physical/mental impairment (or combination) expected to last at least 12 months or result in death.

““SUBSTANTIAL GAINFUL SUBSTANTIAL GAINFUL ACTIVITY” (SGA):ACTIVITY” (SGA):

2012: $1,100/month(disabled)

$1,690/month (blind)

SOCIAL SECURITY SOCIAL SECURITY RETIREMENT BENEFITS:RETIREMENT BENEFITS:

Available to worker who has reached “normal” retirement age (which varies based on birth date). Benefit amount based on worker’s “primary insurance amount (“PIA”)” and age.

SPOUSE/FORMER SPOUSE SPOUSE/FORMER SPOUSE BENEFITS:BENEFITS:

1. OLD AGE BENEFITS:

If insured worker is alive and receiving benefits, benefits are available to spouse/former spouse who retires at normal retirement age or who is caregiver of worker’s child.

SPOUSE/FORMER SPOUSE SPOUSE/FORMER SPOUSE BENEFITS (CONT’D):BENEFITS (CONT’D):

2. WIDOW’S/WIDOWER’S BENEFITS:

Available to worker’s widow/er based on earnings record of fully insured worker. Available at widow/er’s retirement at age 60+, or earlier if caregiver of worker’s child.

CHILDREN’S BENEFITS:CHILDREN’S BENEFITS:

Available to worker’s children, if worker is entitled to retirement/disability benefits or if worker is deceased and fully insured. Child must be dependent minor or disabled adult.

SOCIAL SECURITY AND SOCIAL SECURITY AND MEDICAREMEDICARE

Those age 65 and over who are entitled to retirement benefits also qualify for Medicare Part A. After 24 months of SSD eligibility, recipients are entitled to Medicare Part A and are eligible for Medicare Part B subject to premium payment.

SSI BENEFIT ELIGIBILITY SSI BENEFIT ELIGIBILITY

Depends upon:

1. Living Arrangements

2. Marital Status

3. Income (Earned, Unearned and In-Kind)

4. Resources

5. Gift Penalties

MAJOR DIFFERENCES BETWEEN MAJOR DIFFERENCES BETWEEN SSD AND SSI:SSD AND SSI:

• SSD available only if “insured”

• SSI not based on insured status or earnings, but based upon income and resources

• SSD available only until retirement age

• SSI available to individuals over age 65

MAJOR DIFFERENCES BETWEEN MAJOR DIFFERENCES BETWEEN SSD AND SSI (CONT’D):SSD AND SSI (CONT’D):

• In NJ, those who receive SSI are also automatically entitled to Medicaid.

• After 24 months of SSD eligibility, those who receive SSD are entitled to Medicare Part A (and Medicare Part B subject to payment of a premium).

INTERPLAY BETWEEN SSI AND INTERPLAY BETWEEN SSI AND SSD:SSD:

• An individual may receive benefits under both SSI and SSD

• Same standards for the disability determination for SSI and SSD (for adults)

INTERPLAY BETWEEN INTERPLAY BETWEEN SSI AND SSD (CONT’D):SSI AND SSD (CONT’D):

• After the first $20 per month of unearned income (including SSD) without penalty, any unearned income is deducted from SSI benefit on a dollar-for-dollar basis.

• SSD benefit could reduce an SSI benefit to zero (resulting in loss of Medicaid).

THANK YOU FOR ATTENDINGTHANK YOU FOR ATTENDING

Questions/Comments?Questions/Comments?