By Lois Zerrer
On behalf of SNA, my colleague Morris Klein and I submitted written testimony to the Senate Committee on Veterans’ Affairs about VA pension eligibility. We sought to clarify guidelines that had been proposed under S.3270 and to make them consistent with other means-tested federal programs. Our testimony focused on:
- determination of a fixed standard for maximum assets;
- exemption of special needs trusts (SNTs) from consideration as countable assets;
- exemption of transfers to children who are blind or have other disabilities.
S.3270 was introduced in response to a GAO report criticizing procedures used by the U.S. Dept. of Veterans Affairs to determine the financial need of pension applicants. In particular, the GAO indicated that in order to meet eligibility requirements, individuals were "dumping" assets at less-than-market value shortly before submitting their requests. S.3270 proposes a 36-month "look back" period, with related penalties, in order to discourage that practice.
Today, VA administrators have enormous discretion in deciding an applicant’s eligibility. Evaluations are based on assets, current expenses and life expectancy—a moving target that creates inequities and uncertainty. We pointed out that "a veteran can only ‘guess’ whether the resources he or she has are low enough to be eligible for benefits. Moreover, a veteran in one region may qualify for benefits, while a veteran in another region would not be eligible."
Consistency with Other Federal Programs
We also requested that funds held in SNTs be excluded from eligibility calculations and that there be an exemption for transfers to children who are blind or have other disabilities. Means-tested programs such as Medicaid and SSI have long carved out such exceptions. We explained that SNTs differ from private retirement income or other annuities and trusts because they pay for care of individuals with disabilities that would not be covered by public benefits.
Finally, we asked that the law not be retroactive. The bill’s current language stipulates that the changes go into effect one year after the bill is signed into law. But because a three-year look back period is proposed, "a beneficiary may lose benefits resulting from transfers made two years before the effective date of the law."
SNA agrees with the spirit and intent of S.3270 but believes that it can be strengthened by clarifying eligibility guidelines and by aligning them with those of other federal programs.