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House Bill 4351: Going After Pension Poachers

March 4, 2016

by Lawyers With Purpose with 3 Comments Asset Protection Legal Technical VA

House Bill 4351 should be stopped!

For the past several years, bills have been introduced for Congressional approval that would impose a three-year look back, and penalties up to 10 years, for veterans and their spouses who give away their assets and then apply for a pension program designed for indigent wartime veterans. The bills were limited to addressing the concerns of deliberate impoverishment by veterans with the help of lawyers, financial advisors, and others. The bills never passed.

In January 2015, the Veterans Administration published proposed changes to the laws in the Federal Register that would change Title 38 of the Code of Federal Regulations. The VA included penalties for transfers of assets, and used very broad definitions of transfers (i.e. the purchase of an annuity), just like the previous bills that had been introduced. However, the VA went much further, proposing to (1) extend beyond its Congressional authority and (2) extend beyond the scope of the perceived needed changes.

Beyond VA Authority.

Under the pension program for wartime veterans, the claimant must meet an income and asset standard. With regard to income, the VA deducts from gross income all permissible medical expenses. Home healthcare is a permissible medical expense. But the VA proposed to limit the deduction to the average cost of home healthcare based on a national average set two years prior to the proposed changes, which would be $21 per hour. The law is clear that if a medical expense is deductible, then the entire amount must be deducted, and a change of this nature is in violation of the Congressional right.

Beyond the Scope

The purpose of the bills introduced into Congress and the purpose of the proposed changes to the VA regulations is to prevent people from divesting themselves of assets, which they otherwise could use for themselves to pay for care, in order to qualify for tax-free income from the VA to pay for their care. The VA exceeded the purpose of these bills when they included in the proposed changes a limitation on the lot coverage for veteran’s home place. The home place and a reasonable lot area have always been exempt by the VA when applying for pension. A reasonable lot area has always been defined as the same or similar in size to those in the same community or neighborhood. Rather than keeping the long-standing laws, the VA wants to count any property value that exceeds two acres. This makes no sense under the purpose of the law changes to keep people from divesting themselves of assets. First, a 900-square-foot condo in New York City may be worth well over $1,000,000, but it would be an exempt resource under the proposed changes. Whereas, a house sitting on five acres in south Georgia would be a countable resource, even if its value is only $150,000. Moreover, the veterans may have been living in the house for 10, 20, 30 years or more and had no intention of ever filing for the VA pension when they bought the house. Thus, the change in the law has nothing to do with the perceived abuses of people trying to save their assets and qualify for benefits.

Congress has apparently given up on trying to pass a bill that specifically details a look back and penalties for wartime veterans who give money away to qualify for the pension. After all, this is an election year and that would not look very good.

Nonetheless, a few members have found a sneaky way to get the VA’s proposed changes passed by Congress without Congress necessarily knowing what they are actually passing. House Resolution 4351, submitted in the House of Representatives on January 8, was sponsored by Rep. Matt Cartwright of Pennsylvania and co-sponsored by Rep. Sanford Bishop of Georgia, Rep. Sheila Jackson Lee of Texas and Rep. Walter Jones of North Carolina. It has been referred to the Committee on Veteran’s Affairs.

Its stated goal is “To protect individuals who are eligible for increased pension under laws administered by the Secretary of Veterans Affairs on the basis of need of regular aid and attendance from dishonest, predatory, or otherwise unlawful practices, and for other purposes.” The act would be titled, “Veterans Care Financial Protection Act of 2016.”

This sounds really good, because Congress is professing to protect veterans from financial predators. Second, the act does nothing more than mandate that the secretary of the VA work with the heads of federal agencies, states, and such experts as the secretary considers appropriate to “develop and implement Federal and State standards to protect individuals from dishonest, predatory, or otherwise unlawful practices.” The VA would then have 180 days to submit the standards to the Committee on Veterans’ Affairs of the Senate and of the House of Representatives. If this resolution passes, the VA can just hand over the proposed changes in the laws as the standards. The resolution does not say what the two committees are to do once they receive the standards from the VA.

The VA plans to finalize proposed changes (with modifications) by early summer. What is unclear is whether a passage of this “blind” resolution would immediately sanctify any changes the VA has made, or if the changes cannot take effect until after the two committees have taken some action of approval. What is clear is that advocates and veterans must once again push to make your political leaders, specifically those in the two Veterans’ Affairs committees, aware of these damaging changes that have no bearing on the purpose of the proposed changes – limiting home healthcare to an outdated national average and limiting the home place lot coverage to two acres instead of a reasonable lot for the area.

If you would like to know more about the VA Proposed 3 Year Lookback and Other Law Changes join our FREE WEBINAR on Wednesday, March 16th at 4EST. Click here to reserve your spot today.

Victoria L. Collier, Co-Founder, Lawyers with Purpose, LLC; Certified Elder Law Attorney through the National Elder Law Foundation; Fellow of the National Academy of Elder Law Attorneys; Founder and Managing Attorney of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Veterans Advocates Group of America; Entrepreneur; Author; and nationally renowned Presenter.

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VA form 21-8049 – Request for Details of Expenses

March 1, 2016

by Lawyers With Purpose with No Comment Estate Planning Drafting Software Legal Technical VA

For all you high Fact-finder/Follow through Kolbe types, don’t panic if the VA form 21-8049 number means nothing to you. It shouldn’t necessarily. If you file non-service-connected pension claims with the VA, you may never have had occasion to use this form, which is formally called a “Request for Details of Expenses.” It is not generally part of what Lawyers with Purpose considers a fully developed VA claim, although there are those who routinely include this form with all their VA claims.

Purpose of the 21-8049

As the name of VA form 21-8049 suggests, its main purpose is to report monthly non-medical expenses as well as expenses of dependents that otherwise are not typically reported on any other forms one submits with a fully-developed claim. The 21-8049 is usually sent to a claimant to be completed when the VA requires further information after the formal claim is filed. In fact, the VA specifically states in the instructions at the top, “We need additional information to determine whether you are entitled to benefits.” The VA may request this additional information because the adjudication manual directs the adjudicator to determine “whether or not the claimant’s financial resources are sufficient to meet his/her basic needs without assistance from VA. If a claimant’s assets are large enough that the claimant could use these assets to pay living expenses for a reasonable period of time, net worth is considered a bar,” M21-1 Adjudication Procedures Manual, Part V, Subpart I, Chapter 3, Section A.1.e. The 21-8049 may not be requested for every claim you file, but if it is requested, it can delay the claim process. For that reason, some choose to include this form with every formal claim they file. Or, you may decide to complete this form only when your claimant has unusually high non-medical living expenses that you want to make evident to the VA.

How to complete the 21-8049

The current version of this form is dated Aug 2007 in the lower left corner of the first page, although the VA still accepts older versions. It is a two-page form that consists of seven sections. The instructions are minimal, but the VA does provide a toll-free number to call for assistance. Like any other VA form, it is recommended that you complete every section. Non-applicable sections should be crossed out, or you should otherwise indicate that these do not apply. Sections I and II are for listing dependents – both those living with the claimant and those not living with the claimant. Furthermore, you can specify the amount, if any, that the claimant contributes to the support of dependents not living with the claimant so that the VA will consider these amounts when evaluating whether the claimant’s net worth is sufficient.

Sections III, IV, V, and VI are for “Monthly Expenses (except medical) for you and those listed above as living with you,” “Hospital and Medical Expenses,” “Educational Expenses,” and “Expenses of Last Illness and Burial of Veteran, Spouse, or Child and Just Debts of Deceased Veteran or Parent’s Spouse,” respectively. The completion of these four sections is fairly straightforward, but a few remarks should be made to avoid potential problems. Section III lists several possible monthly expenses, like Housing, Food, Taxes, etc., and it also provides blanks for inserting other types of expenses, but this section is only for reporting non-medical expenses. For example, the line item “Housing” should not be used for reporting fees for a nursing home or assisted living facility. Instead, total medical expenses that were reported on the VA form 21P-8416 “Medical Expense Report” with the formal claim should be reported in Section IV, “Hospital and Medical Expenses,” along with a brief breakdown of the medical expenses, or simply refer the VA to the already submitted form 21P-8416. Finally, section VII is for reporting “Commercial Life Insurance Payments” to the claimant. While life insurance payouts are not considered income by the VA if the insured was a veteran, these will be considered as part of net worth and could potentially put a claimant over the asset limit unless you can document to the VA that these assets have been spent down.

What to file with the 21-8049

Documentation of the expenses listed on this form is not required but may assist in your claim. If you decide you want to start including the 21-8049 with all your formal claims, you may decide not to include further supporting documentation unless later requested by the VA. If you do refer to the VA form 21P-8416 in Section IV, you may want at least to include a copy of this form for the adjudicator’s convenience. However, if the VA sent you the form 21-8049 to be completed, they may have requested other information as well. In such cases, ensure that you submit the VA form 21-8049 with anything else requested in the VA correspondence, and that you respond by any deadlines the VA may specify.

If you want to lear more about the Veterans Administration Proposed 3 Year Lookback and Other Law Changes join our FREE WEBINAR on Wednesday, March 16th at 4 EST. Just click here to reserve your spot. Here's what you'll get:

Discover the Nuts and Bolts of the Proposed VA Changes…and What it Means for Your Practice!

On Friday, January 23, 2015, the Veterans Administration proposed changes in the Federal Register that would…

Impose a three year lookback for transfers of assets, including gifts to persons, trusts, or purchases of annuities.
Deny claims for up to 10 years due to transfers.
And exempt only the home and two acres from net worth. If a claimant's property exceeds two acres, it will count toward the net worth figure for eligibility.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

Victoria L. Collier, Veteran of the United States Air Force, 1989-1995 and United States Army Reserves, 2001-2004. Victoria is a Certified Elder Law Attorney through the National Elder Law Foundation; Author of “47 Secret Veterans Benefits for Seniors”; Author of “Paying for Long Term Care: Financial Help for Wartime Veterans: The VA Aid & Attendance Benefit”; Founder of The Elder & Disability Law Firm of Victoria L. Collier, PC; Co-Founder of Lawyers with Purpose; and Co-Founder of Veterans Advocate Group of America.

Tips For VA form 21-0779

February 19, 2016

by Lawyers With Purpose with No Comment Estate Planning Drafting Software Systems & Processes VA

Purpose of the 21-0779

The VA form 21-0779 “Request for Nursing Home Information In Connection With Claim for Aid and Attendance” is used only for certain non-service-connected pension claims, and its primary purpose is to document the level of care required by a claimant or a claimant’s dependent. The VA form 21-0779 is completed specifically for individuals who are residents of nursing homes. The importance of documenting this level of care is twofold:

To support a claim for additional pension above and beyond the base level;
To support the need for certain medical expenses.

There are three levels of non-service-connected pension that a claimant may qualify for: Base pension, Housebound, and Aid & Attendance. The base pension is the lowest pension that a claimant may be awarded. Additional funds are granted if you can document that the claimant is housebound, and even more funds go to those requiring another individual to assist with at least two activities of daily living, or ADLs. The VA also looks at level of care when considering medical expenses to offset income. Therefore, the VA form 21-0779 should document the level of care that justifies the medical expenses being declared. This applies to the claimant’s dependents as much as to the claimant. So for example, the VA will not consider the nursing home facility expense for a veteran’s spouse unless a form 21-0779 is completed for the spouse indicating the need for this level of care.

Completing the 21-0779

The VA form 21-0779 is just a single page and is mainly to be completed by a third party; that is, the nursing home. All you need to complete the form is the veteran’s – or claimant’s, if other than the veteran – name(s), and Social Security number(s). When you are completing this form for a living veteran’s spouse or other dependent, that person’s name appears in the field that requests the name of the claimant, even though, strictly speaking, the claimant is the living veteran. When downloaded from the VA website at http://www.va.gov/vaforms/, the 21-0779 has no separate instruction pages. The form is fairly straightforward to fill out, but it still provides a toll-free phone number for those who require assistance completing the form. Despite the fact that you are not completing this form yourself for the most part, you should still review all 21-0779s once completed by the nursing home and before submitting to the VA so that you can confirm that every field is answered.

What to file with the 21-0779

Nothing in particular is required to be filed with the 21-0779 form. If you determine that you do need to file this form, it should be submitted as part of a fully developed claim in order to expedite the processing. If you are filing the VA form 21-0779 with your formal claim, then you do not need to file a VA form 21-2680 “Examination for Housebound Status or Permanent Need for Regular Aid and Attendance” because the former documents that the claimant is in a nursing home and requires skilled nursing care and thus by definition has a permanent need for regular aid and attendance. This will, however, not stop some VA adjudicators from requesting the 21-2680 form in addition to the VA form 21-0779, thus we generally request all our VA clients to get a VA form 21-2680 completed as soon as they have retained us.

Always remember that this form can be used for supporting both a claim for a higher level of pension and the need for certain medical expenses. Keep those two purposes in mind when you are deciding whether or not it needs to be included as part of your VA claim, and when reviewing its completion by the nursing home to make sure there are not unexpected results with your claim.

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By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

(Shhhhh…..) Client vs. Lawyer: TMI

January 29, 2016

by Lawyers With Purpose with No Comment Estate Planning Drafting Software Systems & Processes VA

The best way to illustrate the topic of this post is with the following joke:

A man is flying in a hot air balloon when he realizes he is lost. He reduces his altitude and spots a man in a field below. He lowers the balloon toward the man and shouts to him, “Excuse me, can you help me? I am late to meet a friend, but I don’t know where I am.”

The man below says, “I’m happy to help. You are in a hot air balloon, hovering approximately 30 feet above this field. You are between 40 and 42 degrees N. latitude, and between 58 and 60 degrees W. longitude.”

After a brief pause, the balloonist declares: “You must be a lawyer.”

“I am” replies the man. “How did you know?”

“Well,” says the balloonist, “everything you have told me I am sure is technically correct, but I have no idea what to make of your information, and the fact is I am still lost.”

The man below responds, “Indeed. And you … you must be a client.”

“Why, yes, I am,” replies the balloonist, “how in the world did you know?”

“Well,” says the man, “you don’t know where you are, or where you are going. You have made a promise that you have no idea how to keep, and you expect me to solve your problem. The fact is you are in the exact same position you were in before we met, but now it is somehow my fault.”

(From http://www.milwaukee-business-lawyer.com/my-favorite-lawyerclient-joke/)

Funny, right? But how true! Most of our clients and their families come to us for answers or solutions in the form of information, but sometimes the very information for which they pay us, and that they desperately need, is the source of much frustration and confusion for them. Why is that and what can you do to remedy the situation? One of the most common issues that may occur when relaying information to a client regarding a VA claim is giving too much or too little information. You can also have problems if you do not time the release of information correctly, or worse yet, give out the wrong information.

Some of this is undoubtedly beyond one’s control. For example, gauging the amount of information that your client is going to expect and want has a lot to do with that individual’s particular personality or social style. You can often tell from initial contact if your client or client’s family is going to participate actively in their planning and the application process versus how much they want you to just take care of everything and leave them out of it. Thus you may have to adjust your response and the amount of information you provide to meet individual needs on a client-to-client basis. As a good baseline, resist the urge to discuss how the sausage is made. I actually prefer clients who are engaged in the process and seek to comprehend the information they are given. Clients like this can be strong allies in the process of getting a VA claim completed and filed, as well as great referral sources because they appreciate how much work is entailed.

However, regardless of what the client may want, there is obviously a lawyer’s duty to the clients to keep them informed concerning their representation. Per the Preamble of the American Bar Association’s Model Rules of Professional Conduct, a lawyer's responsibilities include the following: “As advisor, a lawyer provides a client with an informed understanding of the client's legal rights and obligations and explains their practical implications. . . . As an evaluator, a lawyer acts by examining a client's legal affairs and reporting about them to the client or to others.” At the very least, someone in the family has to be made aware of the most basic information regarding the legal services you are performing for them: what you are doing, what is happening next, and what to do if circumstances change.

While you can’t always choose the personality of your client, factors like bad timing of information or giving out wrong information are largely ones that you should be able to control. By bad timing, I mean giving information when it is not required at that particular moment. This could be as simple as explaining the VA appeals process when you haven’t even filed an “Intent to file claim” form yet. It could also be giving necessary information too late to be of use. The best way to avoid either is to anchor back to your VA process and advise and inform your client at every major step as to what you have just done and what to expect next. Also systematize what information should be given at each stage using client handouts, correspondence templates, etc., so the client receives the information when needed and not afterwards. While there is no problem with giving the client an overall summary of the process, avoid giving too much information for future stages in the process that may in fact never occur.

The problem with giving a client the wrong information should be self-evident. The rules and laws impacting VA eligibility can be complex, but there is a wealth of resources online, including original sources like the Code of Federal Regulations and the VA Adjudication manuals, both of which are available at the VA’s Web Automated Reference Material System and which should be consulted regularly to ensure the accuracy of what you are telling your clients. Organizations like Lawyers with Purpose are also indispensable for the support they provide in the form of legal/technical learning opportunities and a network of colleagues facing the same challenges who are ready to answer your questions or act as a sounding board for your daily dilemmas. If you choose to make the time to use the resources available, you can ensure that you do not make the mistake of giving the wrong information.

Are you interested in learning more about the Lawyers With Purpose Estate Planning Trust Drafting Software? If so, click here and we'll hop on a call with you and show you how it works first hand! We think it's the best thing out there and are confident you will too after you see it for yourself. Click here now and we'll take it from there and start walking you through the difference it will make to your estate and/or elder law practice.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

Getting the Physician Form Right for Aid and Attendance

January 4, 2016

by Lawyers With Purpose with 6 Comments Estate Planning Drafting Software Legal Technical VA

Purpose of the 21-2680:

The VA form 21-2680 “Examination for Housebound Status or Permanent Need for Regular Aid and Attendance” is used to document the level of care required by a claimant or a claimant’s dependent. The VA form 21-2680 is completed by a physician based on his/her medical evaluation of the patient. The importance of documenting the level of care is two-fold:

To support a claim for additional pension above and beyond the base level AND
To support the need for certain medical expenses.

There are three levels of non-service-connected pension that a claimant may qualify for: base pension, housebound, and aid and attendance. The base pension is the lowest pension that a claimant may be awarded. Additional funds are granted if you can document that the claimant is housebound, and even more funds go to those requiring another individual to assist with at least two activities of daily living (ADLs). The VA also looks at level of care when considering medical expenses to offset income. Therefore, the VA form 21-2680 should document the level of care that justifies the medical expenses being declared. This applies to the claimant’s dependents as much as the claimant. So for example, the VA will not consider the assisted living facility expense for a veteran’s spouse unless a form 21-2680 is also completed for the spouse indicating the need for the facility to assist with at least two ADLs.

Completing the 21-2680:

The VA form 21-2680 is relatively short (two pages) and is to be completed by a third party – that is, a physician. All you need to complete the form is the veteran’s and claimant’s – if other than the veteran – name(s), Social Security number(s), and address. When you are completing the form for a living veteran’s spouse or other dependent, it is that person's name that appears in the field that requests the name of the claimant, even though, strictly speaking, the claimant is the living veteran. When downloaded from the VA website at http://www.va.gov/vaforms/, the 21-2680 has no separate instruction pages. It does state its purpose near the top of the first page: “The purpose of this examination is to record manifestations and findings pertinent to the question of whether the claimant is housebound (confined to the home or immediate premises) or in need of the regular aid and attendance of another person.”

Despite the fact that you are not completing this form yourself, you should still review all 21-2680s once completed by the physician and before submitting to the VA so that you can confirm that every field is answered and that further explanation is provided when required by the instructions. Form 21-2680 should be signed by a physician because the signatures of nurse practitioners or physician’s assistants are not acceptable. Errors and omissions of this type should be corrected before filing the claim or you may risk a delay. Most importantly, you should also confirm whether the form 21-2680 does in fact document the claimant’s housebound status or the need for aid and attendance.

Housebound status is documented by the physician’s answer to field 33, “Describe how often per day or week and under what circumstances the claimant is able to leave the home or immediate premises.” A clear indication of housebound status would include a statement from the physician such as, “Patient no longer drives and relies solely on caregivers to attend necessary doctor appointments.” The VA form 21-2680 will support the need for aid and attendance, if it provides clear evidence that the claimant needs assistance with at least two ADLs. Acceptable ADLs are bathing/showering, dressing, eating, getting in/out of bed or chair, and using the toilet. The following are not considered ADLs by the VA: walking, medication administration, meal preparation, and protective environment only. This is very important in the case of independent living facilities, the expense of which will not be considered by the VA unless the 21-2680 documents that such a facility provides a protective environment and custodial care that is supplemented by a third party providing the assistance with two or more ADLs. Otherwise the cost of the independent living facility may be considered merely rent and thus not a deductible medical expense. A clear indication of the need for aid and attendance would be input into box #25, where it asks if the claimant needs a nursing home. The answer to that question may be “no.” However, the physician should write out to the side something like, “Patient needs to live at ABC facility for a protected environment, custodial care and assistance with ADLs.”

Because of the importance of using the right language on the VA form 21-2680, the software developed by Lawyers with Purpose to complete VA claim forms produces a sample VA form 21-2680 with recommended verbiage and other guidance for the most important fields. This sample can be provided along with a blank form to the doctor for guidance with instructions that can be used if the doctor feels it applies. If the doctor does not believe that it applies, it may be that your client simply does not qualify for as high a level of care. You may still be able to file for base pension or plan to follow up with the client periodically to check if medical needs have increased.

What to file with the 21-2680

Other than the regular VA application forms, nothing else is required to be filed with this form. However, if you feel that your completed VA form 21-2680 is weak in areas, but you believe that your client’s medical condition warrants aid and attendance, you can add supporting medical records. This form should be submitted as part of a fully developed claim in order to expedite the processing. As a reminder, you may not need to file a VA form 21-2680 if your claimant is only seeking base pension. And a 21-2680 does not need to be filed if you are filing the VA form 21-0779 because the latter documents that the claimant is in a nursing home and requires skilled nursing care, and thus by definition has a permanent need for regular aid and attendance. This will however not stop some VA adjudicators from requesting the 21-2680 form nonetheless, so we generally request all of our VA clients to get one completed as soon as they have retained us – particularly because it can take some time to get the completed form back from the doctor.

Always remember that this form can be used for both supporting a claim for higher levels of pension and the need for certain medical expenses. Keep those two purposes in mind when you are deciding whether or not the VA form 21-2680 needs to be included as part of your VA claim, and when reviewing their completion by a third party to make sure there are not unexpected results with your claim.

If you want to see first hand how the LWP-CCS Drafting Software works with VA form 21-2680 – along with the thousands of other things it has to offer you're estate and elder law practice – click here to schedule a live software demo.

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

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Skilled Nursing at VA Expense

December 26, 2015

by Lawyers With Purpose with One Comment Asset Protection Estate Planning Drafting Software Legal Technical VA

“But I won’t ever need Medicaid. I’ll be in a VA nursing home.” You may have heard this before from a client in your attempts to consider the possible need for Medicaid in a veteran’s estate planning. Hopefully the client will never require skilled nursing care, but the reality is that the VA will only pay for or subsidize veterans who need nursing home care due to a service-connected disability or any vet with a combined service-connected disability rating of 70% or more and who need skilled nursing care. The VA only provides nursing home care for individuals in other categories IF beds and resources are available.

First, what do we mean by skilled nursing care and what exactly is a VA nursing home? Medicare.gov defines skilled nursing care as “Care given or supervised by registered nurses. Nurses provide direct care; manage, observe, and evaluate a patient’s care; and teach the patient and his or her family caregiver.” It goes on to say, “Any service that could be done safely by a non-medical person (or by yourself) without the supervision of a nurse isn’t skilled nursing care.” Title 38, Chapter 1 of the Code of Federal Regulations, which relates to the VA, defines a nursing home as:

(1) Any extended care facility which is licensed by a State to provide skilled or intermediate-level nursing care,

(2) A nursing home care unit in a State veterans' home which is approved for payment under 38 U.S.C. 1742, or

(3) A Department of Veterans Affairs Nursing Home Care Unit. [38 CFR 3.1(z)]

The first type of nursing home is one not affiliated with the VA at all. These are private facilities, and probably the majority of nursing homes in which your clients may reside are of this kind. The second type of nursing home is a state veterans’ home that is owned, operated and managed by the state, but must be formally recognized and certified by the VA on an ongoing basis. The state, however, determines the criteria for admission, even though the facility may receive funds from the VA to help subsidize the cost of care to veterans. The third type is what is commonly called a VA nursing home, even though the VA doesn’t call them nursing homes anymore. The VA introduced the term “Community Living Center” and seeks to make the nursing home as much as possible like a real home.

As stated earlier, only veterans with both a documented need for skilled nursing care and who have a service-connected disability that meets certain criteria will qualify for this care at a VA nursing home at no charge. Veterans with non-service-connected disabilities and veterans with lesser-rated service-connected disabilities can apply as long as they require skilled nursing care, but they may be subject to long-term care co-payments.

There are also some other limitations if your client insists on a VA nursing home. There are far fewer of these than the other types of nursing home, and thus there might not be a VA nursing home in your client’s geographical area. State Veterans Homes are fortunately much more common. You can find a directory of State Veterans Homes at the website of the National Association of State Veterans Homes at http://www.nasvh.org/StateHomes/statedir.cfm.

Furthermore, you can’t just decide you are going to a VA nursing home, even if you believe you meet the level of care and rating requirements. There is a process to be evaluated for VA nursing home care. You must first be enrolled for Veterans Health Benefits, which is another process in and of itself and can include an evaluation of income and assets. For example, veterans with non-service-connected disabilities applying for extended care or the Nursing Home Care Unit may be required to complete the VA Form 10-10EC to determine the family's current income and assets. Then, once enrolled with the Veterans Health Administration, you must then be evaluated by a primary care provider or a geriatric specialist for nursing home care.

Another limitation of VA nursing homes is that they generally only accept veterans and not surviving spouses. Some State Veterans Homes do admit surviving spouses and even parents, but that depends on the state. For example, California has veterans assisted living facilities and skilled nursing facilities that will admit spouses, but California also has aggressive estate recovery policies to recoup state funds used to pay for those facilities. Finally, veterans who qualify for VA nursing home care may not always remain qualified. Veterans may be discharged from a VA nursing home without consent when VA nursing home care is no longer needed; for example, if the veteran's needs can be met at home or in a private nursing home close to the family.

If, despite all these hurdles, your client still wants to explore skilled nursing at VA expense or any other long-term care resources of the VA, visit the VA’s webpage at http://www.va.gov/GERIATRICS/index.asp to find information related to geriatrics and extended care.

As we approach the end of the year, we want to personally tell you how thankful we are to have you as a subscriber of the LWP Connection blogs and newsletter. Whatever the reason is that you stay connected with us each week via email (i.e. substantive law training, marketing assistance, practice management tips)…we are glad you are here

Yet, as you work on your practice goals and plans for 2016, please know that the guidance and mentorship you receive here is only THE TIP OF THE ICEBERG of what we offer at LWP.

We want these same results for YOU in 2016! It’s time to check out what becoming a Lawyers With Purpose Member would look like for you and your practice. If you’re even a little curious about what we offer in the Lawyers With Purpose program and how becoming a member will forever change your practice, you owe it to yourself to spend a few minutes reading through this page: www.joinlwp.com.

Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC and Director of VA Services for Lawyers With Purpose.

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Submitting Medical Expenses to the VA

December 12, 2015

by Lawyers With Purpose with 4 Comments Asset Protection VA

Why submit medical expenses?

When applying for Wartime Pension benefits through the Veterans Administration, the claimant must meet both income and asset limitations. Practitioners focus mostly on reducing assets to qualify; however, the claimant’s income must also meet the income standard. A claimant’s yearly family income must be less than the maximum annual pension rate (MAPR) amount set by Congress for any particular year to qualify. Unlike transferring assets to qualify, a claimant cannot transfer income in order to reduce or eliminate it for VA purposes. Sometimes the only way to reduce countable annual income for a claimant is to provide documentation to the VA of allowable medical and dental expenses to offset that income. Considering how medical expenses play a crucial role is critical to a successful claim.

What medical expenses may be submitted?

Not all medical expenses are considered allowable by the VA. The medical or dental expense must have actually been paid by the claimant or claimant’s spouse and be unreimbursed by insurance or any other source, and it may be incurred by any member of the claimant’s household, and even by non-dependents in some cases. The VA provides the following list of examples of medical expenses that might be considered in their instructions for VA form 21P-8416:

Hospital expenses
Doctor's office fees
Dental fees
Prescription/non-prescription drug costs
Vision care costs
Medical insurance premiums
Monthly Medicare deduction
Nursing home costs
Hearing aid costs
Dental fees
Home health service expenses
Expenses related to transportation to a hospital, doctor, or other medical facility

The VA Adjudication Manual gives a more detailed list of common allowable medical expenses in M21-1MR, Part V, Subpart iii, Chapter 1, Section G.42.c. From the total annual medical expenses that the VA considers, only that part which is more than 5% of the maximum rate of pension for your particular claimant may be deducted from income. Thus, you must always consider this deductible when seeking to offset income with medical expenses. The Lawyers with Purpose VA Qualification Worksheet automatically makes this calculation for you.

The VA must consider all expenses that are directly related to medical care, even though this care does not necessarily have to be provided by a licensed health professional. This applies most notably in the case of home health care when the “VA has rated the disabled person (beneficiary or Veteran’s spouse if the Veteran is dually entitled to compensation of at least 30 percent) entitled to A&A or Housebound,” M21-1MR, Part V, Subpart iii, Chapter 1, Section G.43.d.

When to submit medical expenses

Medical expenses should be submitted to the VA at essentially three different times: at the initial application stage, and once approved, after the end of any particular calendar year and whenever there is a significant change in medical expenses. There are two categories of medical expenses that the VA recognizes: prospective and actual medical expenses that are related to when you submit medical expenses. Pursuant to the VA Adjudication Manual M21-1MR, Part V, Subpart iii, Chapter 1, Section G.44.d, “normally, medical expenses are deducted from an award after the fact, based on the claimant’s report of expenses actually paid. However, under 38 CFR 3.272(g), medical expenses may be allowed prospectively if the claimant is paying recurring nursing home fees or other reasonably predictable medical expenses.” When you first apply for VA benefits, you should submit prospective medical expenses for the 12-month period following the effective date. Unfortunately, nowhere is it defined what is considered “reasonably predictable,” and this determination is left to the discretion of the individual adjudicator. In my firm’s experience, the VA will often not consider prescription costs, incontinence supplies, or over-the-counter medical supplies or medications as “reasonably predictable” recurrent monthly medical expenses.

After approval of VA benefits, all actual medical expenses may be submitted for the VA’s consideration. You have until the end of any year to submit actual medical expenses for the prior calendar year. You only need to submit actual medical expenses each year if you are relying on those actual expenses to offset income. If the recurring medical expenses are sufficient to offset the claimant’s income, there may be no need to update the VA annually regarding actual medical expenses. The only other time you should submit medical expenses to the VA is when these change significantly. An increase in medical expenses may not make a difference in the amount of benefits paid but should be reported to the VA nonetheless. A decrease in medical expenses may mean a reduction or even termination of benefits, thus it is important to notify the VA as soon as possible regarding a decrease in order to avoid a potential overpayment of benefits.

How to submit medical expenses

The main application forms for non-service-connected pension – the VA forms 21-527EZ and 21-534EZ – both have small sections for reporting medical expenses. However, there is one specific VA form used exclusively for medical expense submission: VA form 21P-8416 “Medical Expense Report.” You are, however, not required to notify the VA of medical expenses using this particular form. As long as your submission includes the specific purpose for which the payments were made, the amount paid, the date paid, the name of the provider, and for whom the expense was paid, that is sufficient to constitute notification. Generally the VA will accept notification of medical expenses without supporting documentation like receipts unless the adjudicator has cause to question any of the expenses. For this reason, you should advise your client’s family to maintain records of all medical expenses for at least three years, in case the claimant is ever called upon to substantiate those expenses.

Expected changes for medical deductions

In January 2015, the VA issued proposed changes to the regulations governing deductible medical expenses. Of note, when the rules become “final” (expected in February 2016), the VA will no longer count the fees charged by independent living facilities as deductible medical expenses and will cap the deductibility of home health care at $21 per hour.

Please join Dave Zumpano, Sabrina Scott (Director of VA Services, LWP), Kimberly Brannon (Technical-Legal) and me on Monday, December 14 at 4:00 pm eastern as we have a panel discussion of the 2016 VA changes, VA planning and accept your questions. It is our duty as the leading estate planning attorneys in the nation to be prepared and educated on the VA changes coming in 2016, and we at LWP are excited to make sure all of our members are ready and educated when the changes take place.

Registration Link: https://attendee.gotowebinar.com/rt/8232313303938319617

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC, and Director of VA Services for Lawyers With Purpose.

VA Pension Changes Not Likely To Occur Until Spring: How To Prepare Our Veteran Clients

December 9, 2015

by David Zumpano with No Comment Asset Protection Legal Technical VA

In February 2016, the Veterans Administration was set to enact new rules that will limit the availability of pension resources to thousands of veterans in need of care across the country. The February enactment of the new rules was based on information provided on regulations.gov. However, the most recent insider information suggests that the earliest we may see the final rule announced is Spring 2016. Regardless, changes are coming and as elder care attorneys and strong advocates for the senior community we must quickly align our practices with the new VA rules to provide our clients with the optimum result under the changed rules. Currently, the proposed changes to Title 38 of the CFR, include several items worth note.

First, while the current rules allow a veteran or his widow to exempt “reasonable” land as a home place, whether the veteran or widow live there or not, the new rule will limit the home place exemption to 2 acres or less. This will certainly have an impact on farmers and those living in the more rural areas of the country.

Second, under the current rules, information and regulations regarding the deductibility of independent living facilities is contradictory to say the least. Currently, there is enough indication by the VA that as long as a doctor states that the applicant is in need of custodial care and assistance with at least two activities of daily living, an argument can be made that the independent living facility fees should be deductible medical expenses. Under the January 23^rd changes, this “loophole” will be sealed and no independent living fees will be deductible medical expenses.

And, lastly, and most importantly, the proposed rules impose a 3 year lookback for all transfers made for less than value AND subject the applicant to a penalty period of up to 10 years for said transfers. Among the penalized transfers, transfers to trusts and funds converted to annuities are expected to be included.

Where does this leave us as trust and elder care planners? How do we move forward under the new rules? In order to ascertain the answer to these questions, we must evaluate the proposed rule changes along with the rulings the VA has issued on the availability of trust assets.

Currently, there are a number of VA Office of General Counsel rulings indicating what trust assets are not attributable to the veteran. Among these are trusts in which the veteran is the grantor and trustee, but all current and future interest in trust assets and income vest in the veteran’s child or grandchild (Op. G.C. 5-62 (3-2-62), VAOPGCPREC 73-91 (12-17-91)); testamentary trusts established for the benefit of the veteran over which the veteran has no personal control or discretion (VAOPGCPREC 72-90 (7-18-90)); and, third party trusts in which the veteran is an income beneficiary but all trust corpus vests in the trustee (VAOPGCPREC 64-91 (8-9-91)). Another ruling expressly states that any first party supplemental needs trust established by a competent veteran or his fiduciary will count as an available asset to the veteran (VAOPGCREP 33-97).

To indicate the importance of the grantor-trustee not having the authority to access income for himself personally, we can look to a recent VA decision as a case study. A lawyer filed an income only trust (NOT control only) with the veteran as grantor and income beneficiary in November, 2014. The case was denied almost immediately in December 2014. The basis of the denial, while no law or general counsel opinion was provided, was that all assets in the trust are countable assets because the veteran “receives net income of the trust.”

Where do the new rules leave us as planners? As LWP attorneys, we have an arsenal of trust plans available to assist veterans and plan for future Medicaid eligibility at the same time. First, there is the traditional plan that LWP has recommended for years. The home and land can be placed in a My Income Trust (MIT). The MIT is an irrevocable pure grantor trust in which the grantor maintains control and income. We move the home place into a MIT because it is an exempt resource and a low basis asset, allowing us to keep the step up in basis at death and maintains the lifetime exemption of $250,000 under the IRC Code Section 121 at the sale of the home. When the home is sold, the principal from the sale is owned by the MIT and does not then disrupt the grantor’s benefits eligibility. To be extremely cautious, some practitioners will put language in the MIT stating that upon sale of the home, the proceeds therefrom are to become part of another trust, generally a CGT or TAP, in which other assets are placed. Bear in mind that if the home sits on over 2 acres, any land beyond the 2 acres is not an exempt resource under the new rules. So, in that situation, it may be better to place any land over 2 acres into a trust in which the grantor has no income rights. It is not recommended by LWP that any other assets, other than the home place and up to 2 acres of land be placed in the MIT at this time.

After the home is placed into the MIT, the remaining assets can be placed in a CGT (Completed Gift Trust) or TAP (Tax All Purpose) trust. These are both non-grantor trusts. When dealing with veterans benefits, it is more typical to use a CGT trust than a TAP because the CGT does not include the Crummy Powers and GST language the TAP does, and these inclusions are generally not necessary as a person planning for VA benefits does not generally need the estate tax resources the TAP offers. Placing the liquid assets over $80,000.00 into the CGT will start the lookback period under the new VA rules. The CGT has been used by Victoria Collier, and many members, as a fool proof planning tool for VA benefit eligibility. The grantor is not the trustee, has no access to income or principal and the gift is completed for tax and planning purposes.

Further, it is clear that the rules as written do not exclude us from using a FIT to hold client assets. Well planned use of the Family Income Trust (FIT) should not only get a client on VA benefits, but will also qualify them for Medicaid in every state. The FIT, a control only trust, is a grantor trust used when a client has enough income to live comfortably on. The client can move assets into the FIT and remain the trustee. While the grantor/trustee has complete control over the assets in the trust, he personally has no access to the principal or income from the trust. The grantor can keep the assets within his taxable estate for IRS purposes, but has NO access to the corpus or income from the trust for public benefits planning purposes. While the VA has not appeared to have issued an opinion based directly on the use of the LWP FIT, it is clear their issue has lied 100% with the grantor having access to the income thereby making the FIT (a control only trust) a viable and useful planning tool.

If you're a Lawyers With Purpose member, I encourage you to listen to the webcast Dave Zumpano and Victoria Collier did last week, located on the Lawyers with Purpose website. And, if you're an estate or elder law attorney, please join Dave Zumpano, Victoria Collier, Sabrina Scott (Director of VA Services, LWP) and me on Monday, December 14 at 4:00 pm eastern as we have a panel discussion of the 2016 VA changes, VA planning and accept your questions. It is our duty as the leading estate planning attorneys in the nation to be prepared and educated on the VA changes coming in 2016, and we at LWP are excited to make sure all of our members are ready and educated when the changes take place.

Registration Link: https://attendee.gotowebinar.com/rt/8232313303938319617

Kimberly Brannon, Esq, Legal-Technical and Software Trainer at Lawyers With Purpose

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Finding Balance When Speaking

November 24, 2015

by Lawyers With Purpose with No Comment Asset Protection Legal Marketing VA

I give a ton of presentations on veteransʼ benefits, to both attorneys and the public at large. The presentations range from 15 minutes to three days. Last week I presented at an independent living facility that requested the presentation be limited to 30 minutes, which included time for questions and answers. As I often do, I wondered, “How can I tell them all they need to know in that short amount of time?”

It is about maximizing the time you have. This became very real for me when I was out of town on a business trip and I wanted to get a massage. I usually get a 90-minute full body massage, but the spa only had an opening for 30 minutes. I asked myself, “What is the point?” but I booked the appointment anyway. When I arrived, they handed me a picture of a person and asked me to circle the areas of concentration I desired. I circled my head, neck, shoulders, back, hands and feet (everything but my legs). To my surprise, the therapist did an amazing job, even though she didn't get to my hands and barely touched my feet. A quality massage in 30 minutes could be done!

And so can a quality presentation on VA benefits. The problem is that we want to give the audience the full treatment, leaving nothing unsaid. Instead, dissect the information like a body and circle the most critical areas on which to focus. Focus on those areas first; then, if you have extra time, you can add to the content. If you are short on time, cut out some of the minute details. Leave something for them to ask you or for you to share at a consultation.

After presenting easy-to-understand, complete information in 30 minutes, I had just as many people immediately request an appointment as I do when I speak for an hour. Since time is money, this begs the question: Do I need to speak for an hour? Do I need the 90-minute massage or is 30 minutes enough?

Refine your message, save time, and make more money.

If you have an hour of time on Wednesday, December 2nd at 12 EST, Dave and I will be sharing what we are currently doing in trust planning for VA benefits after the proposed look back takes place. Click here to register now. We'll talk about the transfer penalties for VA claimants expected to be implemented in February 2016. What does that mean for your trust drafting services? Will we need to change the language in our trusts? Or, worse yet, start using totally new trusts? Attend the upcoming VA Tech School Training on December 2nd at 12 EST on Drafting Trusts After the Laws Change.

Seeking Congressional Assistance to Get VA Claim Approval

November 10, 2015

by Lawyers With Purpose with 3 Comments Asset Protection Systems & Processes VA

What is Congressional Assistance?

It has been “X” months since you filed the VA formal claim, and your sole correspondence from the VA consists of periodic form letters apologizing for the delay. Your calls to the VA inquiring about status reveal only that the claim is still pending, but your client is getting exasperated hearing that the average processing time for approving VA claims is less than “X” months.

Congressional assistance is when a private constituent requests a member of Congress to inquire on their behalf in the administrative proceedings of a governmental agency, in this case the Department of Veterans Affairs. The purpose of doing so is to force the VA to pull a specific claim from their backlog and expedite it. The actual result is not always that, it seems. There are reports of success from various internet forums dedicated to veterans’ benefits – people who swear that, had it not been for Senator So-and-So, their VA claim would never have been approved. But there are even more grumblings on the same forums that such congressional inquiries merely elicit a form letter, and then your file returns to the backlog BUT at the end of the queue. This is horrific enough to scare you off from considering making any such inquiries, but at times of sheer desperation it can be a tool to make the VA respond, or to be able to get a copy of a VA response. Then sometimes a client’s family will demand it because apparently it had been done successfully by their hairdresser’s brother-in-law’s grandfather. Therefore, you should be aware of the option of requesting congressional assistance with a VA pension claim, how to do it, and when it may be appropriate to do so.

How do you file a Congressional?

First, you need a member of Congress. Our firm generally uses a senator. I don’t know that there is any advantage to having a senator rather than a member of the House of Representatives making the inquiry. However, you must be aware that not all members of Congress may be receptive to making such inquiries. If their platform and/or expressed political views suggest that veterans’ benefits may not be a priority, you may need to approach with caution. Most members of Congress have websites that post information for the types of assistance they provide. Members of Congress who do count a large number of veterans among their constituents may even regularly reach out to explain what specific services they can provide for them. This assistance generally requires a privacy release form that must be signed by the veteran or other type of claimant so the VA will release information to the congressperson’s office.

Our firm sends the privacy release form with a letter requesting assistance on behalf of our client, and includes a timeline of the claim highlighting any major dates relevant to the claim process. We also mention in this letter any circumstances that may merit that the claimant’s request be considered with utmost urgency. This would include statements, if applicable, as to the claimant’s terminal condition, advanced age, and/or financial hardship. Once their office files the inquiry with the VA, that agency must respond within a certain amount of time, even if it is just a form letter apologizing for the delay. The congressperson’s office generally then forwards a copy of the VA correspondence to the claimant.

When do you file the Congressional?

This is the hardest question to answer, and the only quick and easy way to do so is as follows: It depends.

You may be pressured by your client to file a request for congressional assistance at any point after submitting the formal claim, when presumably the VA should have everything it needs to decide the claim. Your client can also certainly request assistance on their own without your firm’s involvement. However, given the mixed results, I would recommend that you consider it primarily as a last resort, meaning you should exhaust all other means first, like calling the VA for status inquiries and to follow up on submitted requests to expedite a claim due to terminal condition, advanced age and/or financial hardship. You also need to decide, given the average amount of time it is taking for the VA to process your firm’s claims, at how many months you are going to seriously consider requesting congressional assistance.

Our firm currently uses the one-year mark after filing a formal claim to start considering this option, but this is subject to change as we see claim processing times change over the years. Bear in mind that processing times vary regionally, and that overuse of your local congressperson will not earn you much love from his or her office. Reserve the request for congressional assistance for those VA claims that truly seem to have dropped off the face of the earth, or for those claimants who may end up in extreme financial straits or who for medical reasons may not survive to receive the benefits to which they are entitled unless they are awarded right away.

Lawyers With Purpose is offering a FREE Webinar on Wednesday, December 2nd at 12 EST on "Trust Planning for VA Benefits After the Proposed Look Back Takes Place" – click here to register now. Transfer penalties for VA claimants are expected to be implemented in February 2016. What does that mean for your trust drafting services? Will we need to change the language in our trusts? Or, worse yet, start using totally new trusts? Attend the upcoming VA Tech School Training on 12/2/15 on Drafting Trusts After the Laws Change and find out! Register today as we have limited space!

By Sabrina A. Scott, Paralegal, The Elder & Disability Law Firm of Victoria L. Collier, PC, and Director of VA Services for Lawyers With Purpose.