A Special Provision for the Income Test

A special provision for calculating Pension income, allows household income to be reduced by 12 months worth of future, recurring medical expenses. Normally, income is only reduced by medical expenses incurred in the immediate months prior to application. These allowable, annualized medical expenses are such things as insurance premiums, the cost of home care, the cost of paying any person to provide care, the cost of adult day care, the cost of assisted living and the cost of a nursing home facility.

 

This special provision can allow veteran households earning more than the annual MAPR to qualify for Pension. As an example, a veteran household earning $6,000 a month could still qualify for Pension if the veteran is paying $4,500 to $6,000 a month for nursing home costs. The applicant must submit appropriate evidence for a rating and for recurring costs in order to qualify for this special provision.

 

VA normally does not tell applicants about this special treatment of medical expenses or how to qualify for it.

 

Rationale for Allowing Future, Annualized Deductions
The following is quoted from VA manual 21-1:

 

"The basic theory underlying improved Pension is that during any given month a beneficiary's IVAP plus VA Pension benefits will establish a given level of income (the MAPR). To make the program conform more closely to its basic theory, certain expenses paid by a beneficiary are taken into consideration in arriving at the individual's IVAP. Most deductible expenses are allowed as deductions from otherwise net countable income. However, certain deductible expenses are allowed only as deductions from specific income. See paragraph 16.35."

 

"Then unreimbursed medical expenses that exceed 5 percent of the applicable maximum annual Pension rate (MAPR) are deductible. Note: In determining the 5 percent deductible, include additional benefits for dependents and the WWI/MBP supplement in the MAPR. Do not include additional benefits for Aid and Attendance or Housebound status in the MAPR..."

 

"In most instances, the medical expense deduction is allowed after the fact. However, if a claimant has consistently recurring unreimbursed medical expenses (for example, a nursing home patient), it may be possible to allow the medical expense deduction on a continuing basis." (This means certain recurring expenses can be counted for the 12-month future benefit period.)...

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