Helping to protect veterans' LTC coverage

Q. I sell LTC insurance in an area with a lot of veterans. I know the Veterans' Administration will pay for LTC coverage in certain situations, which certainly affects my sales. What kind of coverage does the VA provide?

A. The Veterans' Administration will help pay the LTC expenses of veterans and their widows, but it can be difficult to qualify for this benefit. To learn about the specific benefits provided, I consulted with California elder-law attorney Gilbert Fleming, who has written a workbook on this topic.

Fleming explained that the VA will pay a married veteran up to $1,801 per month to help with LTC expenses. A single veteran can receive $1,554, and a widow will receive $998 per month. These benefit amounts are adjusted annually. To qualify, there are four criteria:

1. Service Days — The veteran must have served 90 days in the service, and only one day must have been served during a "wartime era." (World War II's wartime era started December 7, 1941, and ended December 31, 1946.)
2. ADL Requirement — The veteran must need "assistance" due to a disability (two out of five ADLs or cognitive impairment). The applicant must be over 65 years of age or unemployable. The disability need not result from the veteran's military service; Alzheimer's disease is an acceptable disability. The disability must be certified by a physician.
3. Income Criteria — The VA will provide benefits to help pay for a veteran's (or widow's) unreimbursed medical expenses. The VA subtracts the amount of the veteran's monthly unreimbursed medical expenses from his monthly income. If his unreimbursed medical expenses exceed his income, he may be eligible for VA benefits. Those medical expenses are the "red ink" with which the VA will base the amount of its award.
4. Net Worth Criteria — A veteran (or widow) can be "too rich" to receive VA benefits. As a rule of thumb, if an applicant has more than $80,000 in assets (the primary residence is not counted), they are too rich. The veteran can buy an annuity; the net worth is now income, possibly making the veteran eligible for benefits. Added to the VA benefit the extra annuity income might allow the veteran to move to a better room. How does this apply in the real world? According to Fleming, the VA program is extremely helpful when disabled veterans want assisted living care. This is because the cost of housing and food provided in an assisted living facility is considered an "unreimbursed medical expense."

Margie Barrie is a principal at Hagelman Barrie Sales Training Solutions www.hbltci.com. Responses and questions can be sent to [email protected].