Cheryl Chapman Henderson, LLC

What Are The New Rules for Veteran's Benefits?

Veterans rejected for disability benefits will have new options for appeals. This is because federal officials are implementing an overhaul of the review process, with the objective of significantly reducing wait times for complicated cases.

The Department of Veterans Affairs announced last month that it will implement new appeals modernization rules starting in mid-February. The changes have been in the works for more than 18 months since lawmakers passed sweeping reform legislation on the topic in the summer of 2017.

Veterans will now be provided with three streamlined options for their benefits appeals, reports the Military Times in the article “VA’s benefits appeals process will see a dramatic changeover next month.”

The VA is now hoping that the most difficult reviews can still be finished in less than a year in most cases. The target for cases that don’t go before the Board of Veterans Appeals is an average of about four months for a final decision.

A successful appeal can result in thousands of dollars in monthly benefits payouts for veterans who’ve previously been turned down, for what they believe are service-connected injuries and illnesses.

“(This) is the most significant reform in veterans’ appeals processing in a generation and promises to improve the timeliness and accuracy of decisions for our nation's veterans,” said House Veterans’ Affairs Committee Chairman Mark Takano, D-Calif.

Veterans groups primarily support the appeals changes, but some have expressed concerns about the new system limiting veterans’ options for future reviews, in favor of getting faster resolutions.

Parts of the new process were implemented as pilot programs at select sites in recent months. In the past, the cases involved a combination of all three options, with cases, reset and repeating steps with every new submission of case evidence.

With the first of the three new appeals processes, veterans can file a supplemental claim where they introduce new evidence in support of their case. The appeal is handled by specialists at a regional office, who make a final decision.

The second option allows veterans to request their cases be reviewed by a senior claim adjudicator, instead of the regional office. Those reviews are for clear errors or mistaken interpretations of a statute. If they find mistakes, they can require corrections for the cases.

The third option allows veterans to appeal directly to the Board of Veterans’ Appeals. Those cases are anticipated to take the longest to process, due to the legal prep work. Veterans can obtain a direct decision or request a hearing before the board.

Veterans with cases currently pending in the system can opt to go with the new processes or stay with the current system if they think it will be better for them.

Reference: Military Times (January 22, 2019) “VA’s benefits appeals process will see a dramatic changeover next month”

IMPORTANT: The Department of Veterans Affairs announced a policy change effective on 10-18-18!

 

THE FOLLOWING MESSAGE IS URGENT!!

 

The Department of Veterans Affairs has announced a policy change that will soon affect all older veterans and their spouses!  Please read on…

 

On October 18, 2018, the VA is instituting rule changes that will make it more difficult for vets to qualify for existing benefits and protect their assets.

 

Vets and their spouses who are 65 or older, served during a period of war, have trouble performing tasks of daily living (bathing, dressing, toileting, etc.), and meet certain financial requirements are eligible to receive up to $26,036 annually in non-service connected benefits through the VA to help pay for long-term care, including home health care and nursing home care.

 

To qualify, most veterans and their spouses will need to work together with their estate planning attorney to create and implement a plan. Proper planning allows the veteran to meet the VA’s income and asset thresholds, without actually forfeiting their assets or being forced to spend down their savings before they could be eligible for benefits.

 

Currently, this type of planning can be done right up to the day the application is submitted…with the VA’s blessing… because they do not have a formal “look-back period” for asset transfers on the books.  But…

 

THIS IS CHANGING AS OF OCTOBER 18^TH!  

 

Starting on October 18, 2018, the Department of Veterans Affairs will begin imposing a three (3) year look-back period on all asset transfers.  Each transfer or gift will cause a penalty period that could last up to five years before you are able to access your benefits.  Other significant changes to the rules are also going into effect.

 

If you don’t have time to wait for benefits or your family could utilize up to $26,036 tax-free to help pay for your care today or in the future, the time to act is NOW.

 

Here is what you must do immediately:

1. If you’ve already done your homework on collecting Aid & Attendance benefits but you’ve yet to move forward with your planning, it’s time to take the final step. Call us at 301-220-4463 and we’ll get you into the office ASAP. Please be advised that spaces are very You must get your planning done before October 18^th to take advantage of opportunities while they still exist before the new rules go into effect. This means that you will need to become a client no later than Monday, October 8^th.
2. If you are an older wartime veteran or spouse and this is the first time you are hearing about Aid and Attendance benefits, please hit REPLY to this email or call the office at 301-220-4463 RIGHT AWAY. We are clearing out spaces on our calendar, but they are limited. We’ll teach you all about this benefit, crunch the numbers to determine how you can qualify, and create a plan to help you get your application in before the October 18^th  
3. If you think you might need care in the future, the time to plan is still RIGHT NOW. You can work to appropriately arrange your finances today so that when you apply for benefits down the road, you can qualify without a penalty.

 

If you are a wartime vet or spouse (or you care about someone who is), there’s no time to delay. Call our office at 301-220-4463, Monday-Friday, from the hours of 8:30 am to 5:30 pm and we’ll work diligently to complete any planning that you may need before the October 18^th deadline. 

 

P.S. I don’t usually say this—but, please SHARE this post with every veteran who you know and care about. Helping a Vet access the Aid & Attendance benefits they are rightfully entitled to for serving during a period of war can mean the difference between aging with dignity or becoming impoverished by the costs of long-term care. This is information that every older vet should know about!

“SNF” Doesn’t Stand for “Sunday Night Football” When Talking About Medicaid and Medicare

“As the mythical movie boxer, Rocky Balboa, reminded us, ‘Time takes everybody out, time’s undefeated.’”

Can you believe the average cost for a one-bedroom unit in an assisted living facility is nearly $42,000 a year in our country?

These long-term-care costs could knock even Rocky out of the ring.

With many Americans hitting retirement age, they may be concerned about how to plan for future financial needs. While there’s a lot of literature available about retirement saving, many seniors don’t accurately measure the significant cost of post-retirement medical care. They simply expect Medicare to cover the costs. However, Medicare is very strict as to the types of long-term care it covers. The program only covers stays in skilled nursing facilities and hospice care under certain strict circumstances.

The Deseret News recently published the article, “How to cover the cost of long-term care,” which reported that for skilled nursing facility (“SNF”) coverage a beneficiary is required to be admitted to a hospital for at least three days, then discharged with a condition that requires skilled nursing level care.

Medicare will cover all of the expense for the first 20 days of the stay. The program then charges a $161 co-pay for every day up to 100 days. Once a patient reaches 100 days, he or she must cover the entire cost after the initially covered 100 days. But if he or she is out of an SNF for more than 60 days, the coverage resets and they can be admitted for another 100 days after a three-day hospital admission. Simple, right?

Medicare covers most types of hospice coverage when a patient has received a terminal illness diagnosis and is not projected to live more than six months. This will encompass the patient’s medication, support services, and services such as grief counseling. Medicare will also pay for short-term hospital stays and inpatient care for caregiver respite. In addition to Medicare, the federal government also provides some coverage through Veterans Affairs (VA). But unlike Medicare and the VA, Medicaid can assist those seniors who qualify with most types of long-term care.

Medicaid is administered by the states, so the benefits and eligibility will vary. However, most of these programs are given incentives for administering alternative programs that let seniors stay at home or with a family member. If the beneficiary qualifies, family members providing their care may be certified as providers and reimbursed for their efforts by Medicaid.

One option for the proactive is purchasing long-term care insurance to cover the costs. However, if that coverage is too expensive because you’re late in buying a policy or you have pre-existing health issues, you should look at other options like Medicaid. If you go that route, you may need to transfer assets and income to trusts or family members. Speak with a competent elder law attorney before you make any moves.

Without a doubt, long-term medical care costs may be an issue for many in retirement. Start to plan early so you’re prepared.

Reference: Deseret News (Sept. 27, 2016) “How to cover the cost of long-term care”

Legal Clinic Gives Law Students Chance to Help Our Veterans

"As we train students, we want to give them the opportunity to understand and appreciate the needs and sacrifices of disabled veterans."

Harvard Magazine's article, "Fighting for Veterans, Learning the Law," tells the story of a letter for Wilson Ausmer Jr. which wasn't good news. In 2011, Ausmer, a lieutenant colonel in the U.S. Army Reserves, was in Afghanistan, serving his third tour. He suffered from post-traumatic stress disorder (PTSD) related to his time on the battlefield, and his foot was seriously injured.

The letter contained information on how he could file an appeal for disability compensation and stated that he had to respond within 120 days of receipt. But Ausmer wouldn't return home for another five months.

By the time he read the letter, he'd lost his one chance to appeal his benefits case. The Veterans Benefits Administration gave him no help, but a trio of Harvard Law School students did. They took his case, arguing that the clock on an appeals claim should start only after a veteran has returned home—rather than when a letter arrives in his or her mailbox back home.

The students became involved in Ausmer's case in 2013, while at the Harvard Veterans Law and Disability Benefits Clinic. Each year, dozens of students have assisted veterans with legal cases, winning verdicts of local and national importance.

Ausmer's student defenders argued their case in front of the U.S. Court of Appeals for Veterans Claims. The court's ruling in the veterans' favor marked a landmark victory. It allowed recently discharged veterans like Ausmer—whose ability to file an appeal is "materially affected" by their service—to be permitted extra time from their discharge date to appeal.

This decision could help thousands of former soldiers.

The Harvard law students can choose to represent veterans in administrative and federal court appeals by challenging denials of federal and state veterans' benefits—like Ausmer's case; represent clients and their families in estate and financial planning matters; or represent clients in administrative and court appeals on issues of denial of Social Security disability benefits.

The goals of the clinic—which also deals with issues of administrative, disability, mental health, probate, and constitutional law—are service and the method and practice of teaching.

Reference: Harvard Magazine (February 9, 2016) "Fighting for Veterans, Learning the Law"

Avoiding State Estate Taxes

The federal estate tax might grab headlines, but many states also have estate taxes that people need to be aware of when estate planning. The state estate taxes often have lower exemptions, so avoiding them is desirable if possible.

Some people think they do not need to worry about estate planning very much these day. Why? Because they do not have enough assets for their estates to be subject to the federal estate tax.

That is a mistake, because there are many other reasons to have an estate plan besides the estate tax. It is also a mistake because many states have estate taxes of their own that require careful planning to navigate. With proper planning, these state estate taxes can almost always be avoided.

A recent Forbes article took on this topic in "Three Surefire Moves To Beat State Death Taxes," which recommend the follow tactics:

• Move – Not every state has an estate tax, so you can move to a state without one. However, you need to be careful about appearing to have merely changed your address to avoid the estate tax. You need to make the move complete, and it is best to cut all ties with your former state.
• Bypass Trusts – These are trusts created at the time of death of one spouse. The trust is usually funded with assets up to the state's estate tax limit. The rest of the estate goes to the surviving spouse. When that spouse passes away, the estate tax bill will be less. These are complex instruments and you will need an estate planning attorney to assist you.
• Gifting – If you give assets away now, they will not be part of your estate and subject to the estate tax. However, make sure that you only do this after speaking to an attorney and accountant so that you do not face unnecessary tax problems.

Proper estate tax planning, whether at the federal or the state level, requires qualified estate planning assistance. This cannot be overemphasized.

Reference: Forbes (October 16, 2015) "Three Surefire Moves To Beat State Death Taxes."

Tax Free Giving

While many people would prefer to wait until after death to give an inheritance to their heirs, others might prefer to give while they are still alive to see the benefits of their gifts. There are ways to give money now and avoid any tax consequences.

Traditionally, wealth is transferred from one generation to the next through inheritances. However, if an elder family member has more money than he or she needs and younger family members are in need, then it is often preferable to transfer the wealth while the elder person is still alive. In fact, that affords the older generation an opportunity to witness the impact of their generosity.

When it comes to giving methods, there are many ways to skin the cat. This was the subject of a recent article in the Columbus Dispatch, "Guide to Life: Pros and cons of leaving inheritances to relatives." Nevertheless, some of those giving methods are more tax savvy than others.

The article mentions three such ways:

• Cash – A single person can give an individual $14,000 a year without tax consequences for the person receiving the gift. A married couple can give $28,000. This amount can be given to as many people as desired so long as no one individual is given more than the limit by the person giving the gift. Moreover, the giver must be sure not to have given more than his or her lifetime limit on "taxable" gifts (i.e., gifts made in excess of the annual gift exemption). That number is currently $5.43 million for a single person and $10.86 million for a married couple.
• Student Loans – When you pay off a loved one's student loan debt, that does not count against the $14,000 annual limit on gifting. Caveat: This only works if the money is given directly to the educational institution.
• College Savings – Money invested in a 529 college savings plan accumulates tax free and can be withdrawn tax free for qualified expenses.

These are just a few of the ways to make tax savvy gifts. Your estate planning attorney can help you with other techniques to benefit your family and favorite charities.

Reference: Columbus Dispatch (October 16, 2015) "Guide to Life: Pros and cons of leaving inheritances to relatives"

Paying the Estate Tax

One of the biggest headaches for executors of large estates is coming up with the cash to pay the estate tax. If the cash or other liquid assets are not a part of the estate, then other things might have to be sold that the testator would have preferred to have gone to his or her heirs. There is a way to avoid this problem.

Estate law lore is full of stories about things that had to be sold to pay the estate tax. Businesses, art collections, real estate, wine collections and much more have been sold so that money could be made available to pay the estate tax. However, there is a relatively simple way to provide your estate with enough cash to pay the estate tax: life insurance.

This was recently explained in the Wills, Trusts & Estates Prof Blog in "How Life Insurance Can Be Used To Help With Estate Taxes."

You can create an irrevocable trust and make it the beneficiary of a life insurance policy.

When the insurance is paid out, the executor of the estate can use the money to pay any estate taxes owed. It is important that the trust be irrevocable in order for the life insurance proceeds to not be included in the estate and also subject to the estate tax.

For this to work the trust must be created at least three years before you pass away. If not, then it will be considered as part of your estate.

Of course, life insurance is not the only way to provide liquid assets that can be used to pay estate taxes. Before rushing to create an irrevocable trust and buying a life insurance policy, talk to an estate planning attorney about your other options.

Reference: Wills, Trusts & Estates Prof Blog (October 15, 2015) "How Life Insurance Can Be Used To Help With Estate Taxes."

The Little-Known VA Long-Term Care Benefit

Here's a frightening statistic from the just-released United States of Aging survey:  Only 3% of professionals supporting people 60 and older say they are very confident older Americans will be able to afford their health care costs as they age. The survey was conducted by the National Association of Area Agencies on Aging, National Council on Aging and UnitedHealthcare.

Forbes reports in its recent article, "The VA Program That Pays for Long-Term Care for Vets," that one reason for the 3% confidence rate is the high and increasing cost of long-term care. It easy to see why that is, with the median price of a private room in a nursing home now about $91,000. That's an increase of 4% from last year.

About half of us will someday use nursing home care, and many others will need long-term care in assisted living facilities or at home.

But here's a little good news… there's a little-known Veterans Administration (VA) program that pays for some long-term care costs for vets and their families. It's called the Aid and Attendance Benefit. This benefit has been around for over 60 years and covers some expenses for in-home care, nursing homes and assisted living facilities. This benefit is available to honorably-discharged wartime veterans over age 65 and their widowed spouses who are eligible for a VA pension and require the "aid and attendance" of another person or are housebound. The VA calls this "additional pension benefits for care assistance in the home or in an assisted living community."

Aid and Attendance pays up to: $1,788 per month to a single veteran, $1,149 to a surviving spouse, $2,120 to a married veteran and $2,837 to a veteran couple. The benefit is tax-free. To qualify, the applicant must either:

• Require assistance with Activities of Daily Living (ADLs) like dressing, bathing,  and eating;
• Be bedridden;
• Be a nursing home patient due to mental or physical incapacity; or
• Have eyesight limited to a corrected 5/200 visual acuity or less in both eyes or concentric contraction of the visual field to five degrees or less

Of course there's the catch: applying for and receiving the money is a real pain in the bottom. The VA estimates it can take on average about five months for an Aid and Attendance claim to be processed after a veteran applies to a VA regional office. Even so, some applicants have been crushed with red tape and much longer waits.

The article tells the story of Frank Fassnacht, an 84-year-old former Disney projectionist now living in a Motion Picture & Television Fund home. He applied for the benefit three years ago, and still no luck. Because of the VA's high turnover rate, it's hard to find a consistent person to help you.

One other thing to note: a veteran may be turned down for the Aid and Attendance benefit if his or her assets are too great. The VA doesn't have a strict rule on how much assets one can have, but it's typically no more than $80,000 (not including your home), depending on age.

The article advises you to seek the assistance of an Elder Law attorney to apply. The rules and paperwork can be a super difficult, so a qualified attorney can really be a help. He or she can also assist you in preserving assets. Also, you should be ready to document your long-term care expenses and provide all the application materials.

Reference: Forbes (July 10, 2015) "The VA Program That Pays For Long-Term Care for Vets."

For more information, visit our website.

Wartime Veterans and their Widows need your Voice by March 24th

 

New Rules: VA is proposing sweeping changes to the Aid and Attendance Program that will effectively deny benefits to our aging veterans and their widows.  Public Comment will close on March 24, 2015.  We need your voice to preserve their benefits. 

 It is now more urgent than ever to plan.

 

What You can do: 

1. File Comment    
2. Share
3. Contact Your Congress Member

NEWS RELEASE:  Veterans Administration Invites Public Comment by March 24, on Proposed Changes to Benefits for Veterans and Surviving Spouses 

The Veterans Administration is proposing sweeping changes to the Aids and Attendance Program under its New Improved Pension Program that could limit access to needed benefits by wartime veterans and their surviving spouses. In response to findings by the Government Accounting Office, VA has stated that it has prepared the rule changes to restrict applicants from transferring or depleting assets to qualify for the program.  Although these abuses account for one percent of the total applicants, the rulings would affect all applicants.  The VA has allowed public comment until March 24. 

The Aids and Attendance Program impacts veterans over 65 and their widows who need help with long-term care costs.  These cash payments allow elderly veterans and their widows to remain in home settings for longer periods of time, retain independence in assisted living environments, partially subsidize private payment for nursing home care, minimize impoverishment of the well spouse, and extend the resources available to pay the costs of care.

 Proposed changes to the rule would require a 36-month look-back period for asset transfers; a defined net worth limit that excludes the primary residence based on lot size; calculations of penalty periods creating unjustifiably harsh outcomes; an almost absolute presumption that asset transfers were for the purpose of qualifying for benefits; imposed penalty periods of up to 10 years; punitive treatment of transfers to trust and for purchase of annuities far exceeding the penalty concept and capping at home care costs.

Public comments to the proposed changes must be submitted no later than March 24, 2015.  Following are the three ways to submit comments:

1.      Online:  http://www.regulations.gov  (the VA’s preferred method and ours too)

2.      Fax: (202) 273-9026,

3.      Regular mail: Director, Regulation Policy and Management (02REG)

Department of Veterans Affairs, 810 Vermont Avenue, NW, Room 1068,

Washington, DC 20420

•         Comments must state that they are in response to “RIN 2900-AO73.” Comments that just agree or disagree are not as effective as those that provide reasons and examples of how the changes would impact veterans and their spouses. Go to www.regulations.gov and enter “RIN 2900 AO73” to see online filed comments.
•         Please also express your views to Congress. An easy way to find your Congressional contact information and email addresses, type your zip code into the directory at www.congressmerge.com/onlinedb/ 
•         If you have questions, contact us at [email protected]
•         Finally, you can read the actual text of the proposed rule changes by going to: http://www.regulations.gov/#!documentDetail;D=VA-2015-VBA-0003-0001.  The Executive Summary and the Summary of the Major Provisions are helpful.

For Our Talking Points on VA Proposed Changes, click here.