(636) 493-3333

Veterans Benefits

“It’s about how we treat our veterans every single day of the year. It’s about making sure they have the care they need and the benefits that they’ve earned when they come home. It’s about serving all of you as well as you’ve served the United States of America.”  – President Barack Obama
There are more than 70 million Americans who are currently eligible for veteran’s benefits. Unfortunately, many of them are unaware they are eligible or do not take advantage of the programs available. You owe it to yourself and your loved ones to get benefits you have earned and rightly deserve.

At Jones Elder Law, we are committed to helping the heroes who have sacrificed so much in service to our country, together with their loved ones, receive all the assistance they are entitled to. We have extensive experience in this area of the law, and can assist you and your family by explaining many difficult-to-understand aspects of the programs and benefits offered, particularly with regard to qualifying for long-term care. Every attorney working at Jones Elder Law is accredited with the Veteran’s Administration and able to handle cases all the way through the determination process.

We invite you to contact us today to learn how we can stretch your hard-earned money further by making every available resource available to you and your family.

Service Pension

One of the main reasons Jones Elder Law decided to become accredited through the Veterans Administration was the Service Pension Program. This program has proven repeatedly to be a game changing benefit that helps families stay home longer and maintain their independence and dignity while still receiving the additional care they require. The Veterans Administration Service Pension Program is available to help veterans who served 90 consecutive days with one of those days being during a war time period. With the exception of a limited window of time during Vietnam, your wartime service does not even require that the Veteran was present where the war was taking place. When the Veteran, or widow of a Veteran, need assistance with two activities of daily living or have a cognitive impairment that requires them to expend money on medical assistance they can be eligible for tax free assistance from the Service Pension program.

The benefit can pay a monthly tax free benefit up to the following amounts based upon the applicant’s status (These rates are determined annually and adjusted for cost of living.  The rates reflected below are as of December 1, 2020 and will remain in effect until December 2021):

  • Married Veteran $2,295.75
  • Single Veteran $1,936.50
  • Widow of Veteran $1,244.50

The benefit is what is referred to as a “means tested” benefit.  In evaluating your claim, the Veterans Administration will examine your income and your assets to determine if you are eligible for assistance. In other words, the Veterans Administration is going to limit the amount of assets and income you can have and still be eligible for financial assistance.  Until October, 18, 2018 the Service Pension did not use a look back and penalty period system.  So prior to October 18, 2018 you could transfer your assets and then immediately turn around and seek assistance.  Claims made prior to the law change were determined almost exclusively on the income test because a veteran receiving proper guidance could always render themselves eligible from an asset standpoint.  Unfortunately, the Veterans Administration changed that on October 18, 2018 for anyone seeking benefits going forward.  For the first time, the Veterans Administration established a bright line test for assets.  At the same time, they adopted regulations similar to Medicaid employing both a look back period and penalty period system.  The Service Pension remains a critical took that can be used to get assistance with your long term care needs at home, in independent living, in assisted living, and even in a nursing home.  Planning ahead has become much more important, as the regulations are designed to make it more difficult for those that to obtain the benefit at the last moment without proper legal planning.

At Jones Elder Law, we have helped numerous Veterans and widows of Veterans obtain the Service Pension to give them much needed assistance in their home or help them with their monthly payments at Independent Living, Assisted Living, Memory Care and even Custodial Nursing Homes.

If you would like to see how the Veterans Administration Service Pension could help you or your loved one, contact us now about coming in for a complimentary Vision Meeting.

Understanding the Service Pension Rules

Veterans Administration Establishes Bright Line Net Worth:

The Veterans Administration’s new regulations established the concept of Net Worth, setting a bright line asset test for the first time ever.  In some respects, the inclusion of a bright line test has improved things.  Under the old regulations there really was no amount or formula to rely upon for the asset test.  That uncertainty led to different results based upon which case worker was involved in the case.  In fact, the Veterans Administration points to this fact as one of the reasons they believe the regulatory changes will actually increase the usage of the Service Pension benefits.  The Veterans Administration Net Worth amount is currently set at $130,773 for the period December 1, 2020 through November 31, 2021.  The Net Worth amount is adjusted annually for cost of living.  For a veteran or widow of a veteran with Net Worth of $130,773 or less, they will be eligible for Service Pension benefits based upon the asset prong of the tests.  Conversely, if the veteran or widow of a veteran’s Net Worth exceeds $130,773 they are not immediately eligible for Service Pension benefits.

Understanding how the Veterans Administration determines Net Worth is clearly very important.  First of all, Net Worth includes BOTH assets that you own and your annual income.  This is a significant deviation from most people’s understanding of Net Worth.  For example, if you have $124,000 in assets and annual income of $30,000 you would have a Net Worth of $154,000 and not be eligible for Service Pension benefits under the Net Worth test.  Annual income is the money you earn from a job or retirement income sources.  Importantly, you are able to deduct educational expenses and medical expenses (for which you did not receive reimbursement) from your annual income.  Using the prior example, if the same person was paying $2,000 per month out of their own pocket for in home health care, then their income would actually be $6,000 not $30,000.  So now that individual would be eligible for the Service Pension because their Net Worth would be under $130,773.

 The determination of your assets also requires a careful review of the Veterans Administration’s regulations.  They start with all real and personal property that you own but then allows for certain adjustments.  Most notably, your primary residence plus two acres is NOT considered as part of your assets for Net Worth.  This has major planning implications that we will discuss later.  Additionally some of your personal property such as household items and your vehicles are excluded.

Three Year Lookback:

The Veterans Administration regulations include a three (3) year look back and penalty period system.  At the time you request assistance with from the Veterans Administration they have the right to request three (3) years worth of financial information.  The introduction of this provision has clearly made the application process more complicated.  You must now provide the case worker with information on your assets going back for a period of three (3) years from the date you are seeking benefits.  This will include things like bank statements, insurance statements, brokerage statements, etc.  The process has become more adversarial and similar to the Medicaid application process.  At its core, the newly created three (3) year look back is attempting to address those who have moved assets in order to meet the Net Worth test.  

What is a “Covered Asset?”:

 As part of the eligibility determination the Veterans Administration created the new concepted of “Covered Assets.”  Covered Assets are the assets you own that exceed the Net Worth exemption of $130,773 and would cause the veteran to be ineligible for benefits.  In the earlier example of someone with $120,000 in assets and $30,000 of annual income, the individual would be considered to have $19,277 in Covered Assets.  Someone with Covered Assets is not going to be eligible for Service Pension benefits because by definition they have assets that exceed the Net Worth test.  The new regulations also allow the case worker to claw back transfers for less that fair market value that have occurred in the last three (3) years.  So for example, if the applicant has Net Worth of exactly $130,773 on the date of application but gave away $15,000 in each of the last three (3) years, the applicant would be considered to have $45,000 in Covered Assets.  Prior to October, 18, 2018 those prior transfers of assets would have had no impact on the applicant’s claim for Service Pension benefits.  For those applying for Service Pension benefits under the new regulations, the transfer of Covered Assets within the last three (3) years will result in the imposition of a penalty period.

Determination of a Penalty Period:

First off, what exactly is a penalty period.  Simply put, a penalty period is a period of time where an applicant will not receive Service Pension benefits even though they would be considered to be otherwise eligible. To determine the penalty period, the applicant would add up all transfers for less than fair market value of Covered Assets that have occurred during the three (3) year look back period.  The aggregate amount of transferred Covered Assets is then divided by the penalty period divisor.  The penalty period divisor is set as the maximum Service Pension benefit for a married veteran, or $2,295 currently.  Using the previous example of the veteran who made $45,000 in aggregate transfers of Covered Assets, the Veterans Administration would impose a 19.61 month penalty.  Even though the veteran would otherwise be eligible for the Service Pension they would not receive benefits for a period of essentially twenty (20) months.

Important Service Pension Planning Notes:

In planning for and seeking the Service Pension we would suggest that you consult with someone experienced in filing Service Pension applications.  The regulatory changes made by the Veterans Administration have done nothing but make the process more confusing and difficult for families.  To many families grow frustrated and simply give up on the process.  Don’t let that happen to you, the Service Pension benefits are too crucial to families and your service to our country entitles you to them.  That being said, there are a couple important points of clarification for anyone examining the Service Pension benefit under the new regulations.

Not all transfers will result in a penalty period.  Only transfers of Covered Assets result in a penalty period.  This has important implications for the Service Pension benefit.  If you have exactly the maximum Net Worth, or less, you can make transfers and you will not be subject to a penalty period.  That is because those transfers would not be considered Covered Assets.  Additionally, your primary residence plus two (2) acres is not included in your Net Worth and is not a Covered Asset.  That means you could transfer your family home without incurring a penalty period.  Jones Elder Law, LLC is certainly not recommending that you engaged in such transfers without a comprehensive plan in place.  However, it is important to understand that if you have made such gifts already, those transfers will not deny you access to the Service Pension.

Final Service Pension Thoughts:

While the new regulations have made the process more complicated, they have not changed the usage of the benefit as a tool to help with long term care needs.  At Jones Elder Law, LLC the new regulations have actually increased the number of cases we are handling.  The additional complication has made it much more difficult for families to navigate the regulatory structure on their own.  Our recommendation for those contemplating the Veterans Administration Service Pension benefit is to plan ahead.  The earlier you begin the process the more financial assistance you will be able to receive.  At Jones Elder Law, LLC when our clients get into their mid 50s we begin to have the discussion of planning for the Service Pension benefit to make sure we are not forced to wait or serve out a penalty period before receiving the benefit they earned.

Finally, do not get lulled into thinking your family home is safe under the new regulatory scheme.  Certainly, the new regulations do not include the family home in the Net Worth calculation.  Not being included in the Net Worth calculation is NOT the same as being safe.  For many families as they journey through the long term care process they will reach a point where continuing to pay property taxes and insurance on the home is a financial burden.  If you sell the family home, the net proceeds from that sale will be included in your Net Worth determination.  This can lead to your Service Pension benefits being taken away until the home sale proceeds are spent down.  At Jones Elder Law, LLC we can show you how to remain in your family home for as long as you can safely do so and protect the sales proceeds if you decide to sell it at some later date.

 

Agent Orange

For a Vietnam era veteran, the Service Pension should not be the end of the Elder Lawyer’s conversation. If you are a Vietnam Veteran that was in the Republic of Vietnam, or exposed to Agent Orange in some other area, there may be a much better option than the Service Pension Program. For Vietnam Era Veterans, the Elder Lawyer should also be educating you about the Veteran Administration’s Disability Compensation Program. Under that program, the Veteran may be able to obtain a larger monthly benefit without any restrictions on their income or assets. For the right Veterans, the Disability Compensation Program is a significantly better alternative to the Service Pension Program.

Going back ten (10) years or so ago a wave went through the legal and financial industries. Lawyers, Financial Advisors, and Insurance Salesmen were educated about the Veteran Administration’s Service Pension and taught how to add that to their practice enhancing their ability to assist clients. This education resulted in members of all those occupations advising Veteran’s and assisting them in getting the Service Pension. With the passage of time these individuals became very proficient at getting their client’s qualified for the Service Pension Benefit. We are proud to count Jones Elder Law among the group that has assisted countless Veteran’s in obtaining these crucial benefits. Over time though, the makeup of our Veteran population is changing. We are seeing almost no World War II Veterans and fewer and fewer Korean War Veterans. As we begin to see the Vietnam Era Veterans, Jones Elder Law recognized the need to make a change in the discussion we were having with clients. Unfortunately, that does not seem to be the case across the group of people assisting Veterans from this Era. Many individuals learned the Service Pension Program and that is all they know. As the old saying goes, if all you have is a hammer then everything you see is a nail. Thus, too many Vietnam Era Veterans are being pigeon holed into a Service Pension claim that is denying them thousands of dollars in benefits they were entitled to receive. Not to mention the potential for an increased surviving spouse benefit for our married Vietnam Veterans.

So, what are we talking about? Any Veteran that served in Vietnam has by administrative ruling been exposed to Agent Orange. In addition, other Veteran’s who served during the Vietnam Era but not necessarily in the Republic of Vietnam may be eligible if they can demonstrate they were exposed to Agent Orange. Exactly how does the Agent Orange exposure change things? After years and years of litigation, the Veteran’s Administration has a list of illnesses that are by definition considered to be caused by exposure to Agent Orange. In making out your Veteran’s Disability Compensation claim there is no need to prove causation, that is presumed based upon the Veteran’s exposure to Agent Orange. If you were exposed to Agent Orange and have been diagnosed with one of the predetermined illnesses you skip past the causation element and are only left with determining what level of disability you have. An example would be Parkinson’s. Parkinson’s is among the group of illnesses on the presumptive list. Let’s say a client walks into Jones Elder Law’s office and is a Vietnam Veteran that needs care because of Parkinson’s. We are going to talk to them about both Service Pension and Disability Compensation. If they are able to get a 100% disability rating, which for many of the presumptive illnesses is very possible, they would be entitled to approximately $3,000 per month and you can stack additional monetary amounts onto that award for other things like erectile dysfunction, sleep apnea etc. There are even special compensation elements and additional benefits for dependents that can bring that award up to $5,000 possibly even $7,000 per month. Best of all it does not matter what the Veteran or their family have in income or assets. The Veteran is entitled to this award because of the disability alone. For a client who will not clearly receive a significant disability rating, we will often recommend they do the legal planning and actually apply for BOTH Service Pension and Disability Compensation. Then when the determinations are received from the Veteran’s Administration the client would choose the higher of the two awards. If later the client’s illness progresses, we can always go back and seek a determination of a higher percentage of disability and switch to a Disability Compensation award when it becomes more than the Service Pension. At Jones Elder Law since we work on a flat fee structure we are always there to assist the client with such future filings, and there is never any cost associated with such an application.

Further, a Veteran who is able to get a 100% disability rating is also entitled to an enhanced benefit relating to long term care. That means if your Veteran client’s health declines to the point that they need custodial care, they would be entitled to payment of their full long term care expenses under the Veteran’s Administration program. Such payment is in addition to the Disability Compensation benefit which they or their dependents would still be entitled to receive. Getting to the 100% disability rating is very real possibility for the clients we serve, so you can see how much better off a family in such a situation would be economically.

It is also important to understand the effects of Nehmer v. U.S. Department of Veteran Affairs, the court rulings surrounding it and what it means to make a “Nehmer Claim.” This requires a bit of background information. After Vietnam, our Veterans were coming home and experiencing a variety of illness. They would seek compensation from those illnesses from the Veteran’s Administration and, as is not uncommon, be turned down. Keep in mind these claims were being made long before the creation of the presumptive illness list. This turned into a series of class actions that ended in what is commonly referred to as the Nehmer Ruling. If a Veteran demonstrates exposure to Agent Orange or was in the Republic of Vietnam, in which such exposure is presumed, and the Veteran’s Administration denies their claim as being related to exposure to Agent Orange they must put them and their illness on a listing. If at any point in the future the Veteran’s Administration adds their illness to the presumptive list, they are entitled to benefits back to the original date of their claim. So, for example the expectation is that Bladder Cancer and Parkinson’s Like Syndrome are going to be added to the presumptive list in the near future. Anyone who filed a claim with those symptoms after Nehmer and was denied based upon causation will be entitled to benefits from the date of their original claim. This can be a huge financial relief to a family that has been battling a debilitating illness throughout their lifetime.

How should this impact your client’s planning? If a Vietnam Era Veteran comes into one of Jones Elder Law’s offices with a demonstrable exposure to Agent Orange but a disease that is not currently presumptive, we will recommend they file BOTH a Service Pension and Disability Compensation Claim. Obtaining the Disability Compensation award without the presumptive status is considerably more difficult, however, if we are successful then we can take that larger award and be all the better for applying. If the Disability Compensation Claim is denied they will be placed on the listing under the Nehmer ruling AND they should still be approved for the Service Pension getting anywhere from $1,000 to $2,100 per month in tax free benefit.

Unfortunately, Disability Compensation claims are outside the scope of what many people serving our Veteran community have been trained to handle. It is very important that those working with Vietnam Veterans understand the Disability Compensation Program and how it should be interplayed with the Service Pension. They need to be staying up on the presumptive illness related to Agent Orange so they can advise the clients walking through their doors. At Jones Elder Law we are committed to being that kind of service provider to our Veteran Clients. We are proud to say we have helped numerous Vietnam Era Veterans and their Surviving Spouses obtain benefits under the Disability Compensation Program and look forward to helping many more.

Need help now?

If you need to speak with us right away, call us now at (636) 493-3333 or leave us your name and phone number and we will call you.

We call you

  • This field is for validation purposes and should be left unchanged.

Keep up with the Jones'

Join our newsletter for news on upcoming events and resources.

2085 Bluestone Drive, Suite 204
Saint Charles, Missouri 63303
(636) 493-3333
Fax: (888) 838 - 1793

3005 Godfrey Road | Suite B
Godfrey, Illinois 62035
(618) 466 - 8466
Fax: (888) 838 - 1793