Q&A Series: Elder Law / Part 2

Elder Law is a complex and highly specialized area of practice that requires a comprehensive understanding of both State and Federal Laws in addition to the ability to tailor legal strategies to each client’s unique needs. Senior Counsel Genny Bernstein, a Board Certified Specialist in Elder Law, has answered some of our client’s most commonly asked questions.

Medicaid eligibility and veteran benefit entitlements have been updated for 2019 as reflected below.

What is Elder Law?

As individuals grow older and life expectancy increases, their physical capabilities, healthcare needs, and other concerns change. Elder law focuses on estate planning, health care needs, living environments and the avenues to help pay for care costs. Every family’s circumstance varies, and objectives must be specific to each. We are here to address, analyze and help navigate the needs of our Florida clients with complex and sometimes overwhelming issues. Additionally, many of the same issues that affect our seniors can also affect those with disabilities. Counseling families as to proper legal documents and processes can be crucial to support and protect loved ones with special needs.

How do I pay for the cost of long-term care?

As clients age, the need for assistance with everyday activities is a commonplace. While many seniors would like to stay in their home, it is not always a viable option. Oftentimes, additional support in an assisted living or skilled nursing facility is required. Notwithstanding where the care is occurring, the costs can be expensive.

The question remains: how can the cost of such care be paid for?

There are generally three ways to answer this question. The first is to pay out of pocket. This reduces and can even exhaust an estate, thereby creating the concerns of outliving one’s money. The second is through long-term insurance, if affordable and if one is insurable. The third is through government benefits, if eligible, through programs such as Medicaid and/or Veteran Benefits.  

Long-term Care Medicaid in a Nursing Home
Do I Qualify?

Medicaid for long-term care is not only very expensive but can also be very confusing. For an applicant to qualify, there are several requirements that s/he along with their spouse, if any, must meet. These include a citizenship requirement, a medical component along with an income and asset eligibility determination. This is a “means-tested” program.

This chart below is a Medicaid Quick Reference Guide for the Long Term Care for determining eligibility.

(January 2019 – figures are subject to change)

Notwithstanding the above figures, there are exempt assets that are not countable in the asset limit. These include but are not limited to a car at any value, personal effects and furnishings, a burial account with a cash value up to $2500.00, and prepaid burial plans/plots and irrevocable funeral plans.

Additionally, if an applicant’s income is too high, don’t assume that you are not eligible. In these situations, the creation of a Qualified Income Trust (QIT) can be used to hold the excess income thereby meeting income qualifications. It is an extra step but it can eliminate ineligibility issues due to overage of monthly income.

Medicaid planning, whether in crisis or if done proactively in pre-planning, involves a comprehensive plan to protect assets within the parameters of the laws, in order to avoid a client, their spouse, and possibly their family from financial impoverishment.  It is imperative to speak to with a specialist to customize the proper plan for each family’s unique situation.

VA Benefits for Aid and Attendance
Do all Veterans qualify?

The Veteran Administration made some significant changes to the rule and regulations governing Veteran Benefits as of October 18, 2018. These changes effect mostly “means-tested” programs and have limited impact on other programs such as compensation. Notwithstanding these changes, the VA offers a variety of benefits to Veterans and their loved ones, from health care to financial assistance.

Pension with Aid and Attendance is a benefit for non-service connected Veterans, meaning Veterans that do not have a service-related injury. This program is “Needs- Based.” There is often a misconception that every Veteran is entitled to such benefits to assist with high-unreimbursed medical costs that can be derived from home care and assisted living. For some, it may even assist with the costs of skilled nursing facilities. However, this is not always the case. The question then becomes; does a Veteran qualify for Pension with Aid and Attendance and what are the requirements?

The criteria contains a service component in addition to medical need, assets limitations, and income evaluations. A Veteran must meet all of the criteria to obtain benefits. In addition, a spouse and certain dependents of a Veteran may also be entitled to benefits; the criteria must also be met.

To qualify, the Veteran must have served on active duty for a period of ninety (90) consecutive days with at least one day being during a wartime period. The wartime periods are outlined by the Veteran Administration, and include World War II, the Korean Conflict, the Vietnam Era, and the Persian Gulf War, to name a few. The Veteran must have been discharged under conditions other than dishonorable. In addition, a Veteran must be either 65 years or older or permanently and completely disabled.

Since this type of VA program is for those with limited financial means, there is a net worth determination. The VA now calculates net worth as the value of your assets combined with yearly income. The net worth limit for a single or married veteran is $127,061 effective as of December 1, 2018. However, there are still excluded assets that are exempt from this calculation.

Lastly, eligibility depends on Gross Countable Income. The Gross countable income can be reduced using a formula utilizing unreimbursed medical expenses (that is out of pocket medical expenses) to determine the amount of the benefit. The higher the unreimbursed medical expenses, the better chance of benefits. If the unreimbursed medical expenses exceed the gross income amount, the applicant will receive the full benefit. If the unreimbursed medical expenses do not exceed the gross income amount, the applicant may be entitled to a lesser benefit.

This chart reflects the current Monthly Pension Rates/Fact Sheet for Pension with Aid and Attendance (Effective date 12-1-2018 and subject to change)

One of the significant rule changes is the creation of a look back period for uncompensated transfers of assets made after October 18, 2018 for all applications submitted for VA Pension. In other words, any gifts or transfers of assets for less than fair market value may create an ineligibility period. The VA will be using a look back period of 36 months or 3 years. The ineligibility period will be determined by combining the total value of the gifts or uncompensated transfers prior to the application and dividing it by the divisor of $2,230 (the benefit amount for a veteran with a dependent for pension with aid and attendance as shown above) thereby creating the time period for ineligibility when an applicant would otherwise be eligible.

Another rule change to be aware of is the maximum penalty period time-frame. Although the look back period is three (3) years of uncompensated transfers prior to the application beginning on or after October 18, 2018, the penalty period can be up to five (5) years.

Although the VA rules can be complicated to understand, the changes made create some uniformity in the application process but still create confusion.

If eligible, these benefits can make a world of difference in the care that an eligible Veteran or spouse can receive on a monthly basis.

Only a VA accredited Attorney and Agent can assist with these type of applications. We, at Jones Foster, have an accredited attorney to assist with such matters.

Medicaid & VA Conflict

When the time arises that clients and their families begin dealing with the aging process and the medical needs that can accompany them, finding solutions becomes the priority. But beware, what one program allows may be completely different than another. This is often the case when planning for Medicaid and Veteran Benefits. There is some overlap with criteria, but some planning strategies can often lead to problems with eligibility between the two long-term planning programs. Hiring a specialist to assist can negate ending up in the Medicaid/VA conflict.