After a year-long investigation, the United Stated Government Accountability Office ("GAO") is recommending that Congress enact legislation that would impose asset-transfer penalties for veterans applying for VA pensions. Presently, there are no asset-transfer restrictions for the VA pension program
Under current law, veterans who served during war time (they need not have served in combat or even in a combat theater) and who have high medical-related expenses (including the costs for home health aids or assisted living) may be eligible for a VA pension that can pay up to $2,019 per month. The key requirements are that (i) the monthly out-of-pocket medical expenses must exceed the household income, and (ii) the veteran's assets (and his/her spouse's, if applicable) cannot be "excessive". Unlike the Medicaid program, which has a defined maximum resource limit of $14,250, the VA pension program has no fixed number. Rather, a "safe" range is often considered to be $20,000 to $50,000, although the VA examiner has wide discretion in determining asset eligibility.
The GAO report claims that over 200 organizations have been identified that claim to assist veterans to obtain a VA pension. The report alleges that many of these organizations sell veterans unsuitable products in order to become pension-eligible.
While there are almost certainly abuses among certain organizations or companies that purport to assist veterans in navigating the VA pension system, in my view the report unfairly lumps skilled elder law attorneys with the "snake oil salesmen" that produce the worst abuses of the system. Nonetheless, it appears that there is growing bipartisan support in Congress to implement asset transfer penalties similar to the transfer penalties currently imposed for other means-tested programs such as SSI and nursing home Medicaid.
Click here for the New York Times story on the GAO report.