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The Elder Law Report, Including Special Needs Planning


January 2019

My colleague Michelle C. Berk, runs an elder law, estates and disabilities practice in Montgomery County, Pennsylvania. She recently attended the National Academy of Elder Law Attorneys’ Summit in Chicago, Illinois, and generously shared the following practice tips on how to navigate the recent changes to the rules for the Veteran’s Administration’s Improved Pension. The tips were gleaned from an excellent presentation during the Summit’s General Session by Valerie Peterson, J.D., of ElderCounsel, LLC, on November 15, 2018.

The new rules limit the net worth of a claimant and his or her spouse to the sum of $123,600, the maximum community spouse reserve allowance for Medicaid purposes in effect at the date of the final rule, with adjustments tied to fluctuations in the cost of living. One ways to reduce a claimant’s net worth is to deduct the claimant’s medical expenses and those of other dependent members living in the claimant’s house hold. During her seminar, Ms. Peterson highlighted a new opportunity clients in need of assistance with ambulation in the home to reduce net worth and get a higher benefit amount under the new rules, which define medical expenses as those which are medically necessary, improve a disabled individual’s functioning or prevent, slow or ease an individual’s functional decline. As such, deductible medical expenses for purposes of the Improved Pension now clearly include in home care afforded to a clamant who, although not rated as needing Aid and Attendance or as housebound, has a written statement from a physician, a physician’s assistance or other qualified medical provider, that the claimant requires the health or custodial care provided in the home.

Clients receiving care in the home from a care provider should be counseled to obtain worker’s compensation insurance, liability insurance, and to comply with all applicable income tax and wage and hour laws. Referring the clients to a payroll service and/or certified public accountant can facilitate tax and legal compliance while also affording convenience so that the family members can focus on just being family again.

Under the new rules, the purchase (on or after October 18, 2018) of an annuity from covered assets will incur a transfer penalty. If an annuity has been purchased after that date as the result of fraud, misrepresentation or an unfair business practice, the annuity will not be subjected to a penalty. The claimant should be advised to file a complaint with the Attorney General of the state in which the annuity is purchased, with the Federal Trade Commission, and/or with the state insurance regulator in the state in which the annuity is purchased. Claimants who need assistance in filing a complaint with the FTC may call the FTC help line at 1-877-FTC HELP. There is a list of telephone numbers for each state’s consumer insurance complaint departments available on the National Association of Insurance Commissioners’ website, at