For those veterans looking for economic assistance to pay for home healthcare, assisted living, or nursing home care, they might want to investigate whether they are eligible for a monthly VA Aid and Attendance Benefit ("A&A"). In order to qualify, the veteran must have served during an active wartime, received a quality discharge, be permanently and totally disabled, be in need of daily aid and attendance, and have nominal assets and a low monthly income. For most veterans who served during WWII, the Korean War, and the Vietnam War, who need the required care, the most difficult qualifier is the requirement of nominal assets and a low monthly income.
To illustrate, assume that Robert Smith served during the Korean War, is age 77, and is required to live in assisted living in order to meet all of his activities of daily living ("ADL") - eating, bathing, dressing, transferring, toileting, and continence. The assisted living facility charges him $3,500 per month for all his ADL needs. He has no other assets, other than $130,000 in a savings account. With only $1,250 of social security income, Robert was concerned that his life savings would only afford him the opportunity to stay in the assisted living facility for 57 months.
Concerned about this result, and with longevity in his family, Robert met with an elder law/VA attorney to discuss the situation. The attorney informed him that he was not eligible for an A&A benefit with $130,000 in savings. However, the attorney did inform him that he could qualify if he restructured his assets. To receive the maximum monthly A&A benefit of $1,644, Robert was instructed to retain $30,000 in savings, and invest $100,000 into an Immediate Annuity (the "Annuity").
The Annuity was structured to immediately commence paying $605 per month for 140 months. The Annuity was also structured so that once a year the monthly payment amount automatically increased by 5%. Thus, in year two, the monthly payment would increase to $635.25. In year three, the monthly payment would increase to $667.01...
As a result of restructuring his assets, Robert qualified for the maximum monthly A&A benefit and was able to economically stay in the assisted living facility for more than 140 months/11.66 years.
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