On October 28th, 2013 the House of Representatives passed HR 2189. HR 2189 threatens to drastically alter the Aid and Attendance landscape by penalizing most asset transfers.
In other words, the Department of Veterans Affairs will penalize gifts if HR 2189 becomes law.
In theory the potential law isn’t a negative development. The idea behind HR 2189 is to restrict benefits to the truly needy. Truly needy, of course, is a subjective term that is open to interpretation. But the general idea of awarding benefits to those who actually have low-incomes and low net worth makes sense. After all, taxpayers are funding the benefit and the government doesn’t have unlimited resources.
The Department of Veterans Affairs says, specifically, that Aid and Attendance is not intended to build inheritances for the family members of veterans and their surviving spouses. Penalizing uncompensated asset transfers is not new. State Medicaid programs, for example, use a similar strategy to ensure that eligibility is restricted to the neediest.
So do I think HR 2189 is a positive development in VA Pension law? Absolutely not (others agree).
One difference between the Department of Veterans Affairs and state Medicaid programs is the speed with which claims are processed. Medicaid programs, despite rigorous checks and balances to ensure their financial integrity, dispose of claims far quicker than the VA. Did you know that the Department of Veterans Affairs doesn’t verify most financial information reported on original applications? And yet the Department still takes months, if you’re lucky, to decide a claim.
How much longer will the VA take to decide claims when they have to look back 36 months to verify financial information? How many mistakes will the VA make? How many people, truly in need, will be denied benefits because they wanted to help a family member?
I think any VA Look-Back law will be disastrous for veterans and their families. You can anticipate longer award times and increased denials. More families will be discouraged from applying because of the red tape involved in submitting an application. Those who do apply will be dismayed to see the more-information letters the Department of Veterans Affairs mails back. HR 2189 is good for the VA and great for attorney’s. Unfortunately the same cannot be said for veterans and their families.
Stay tuned for more articles on HR 2189 and the VA’s new Look-Back law.