I am always explaining how the various sources of payment for long term care don’t mesh well together. That is certainly true when it comes to VA Aid and Attendance and Medicaid benefits. There are quite a few misconceptions. One is the idea that by receiving VA benefits in an assisted living facility a resident will later be ineligible for Medicaid assisted living benefits.
That statement is incorrect and leads to many veterans foregoing as much as $1949 of tax free income each month that can help pay for assisted living care. But it is easy to understand why so many make this mistake. It’s because the Medicaid waiver programs that pay for this type of care have an income cap of $2022 per month. So naturally, the concern is that the additional VA income will push me over that income cap.
Except that not all income is treated as income for Medicaid purposes. The VA Aid and Attendance benefit falls into that category. It does not constitute “countable income”. In fact, there is a Medicaid Communication issued by the New Jersey state agency that administers Medicaid, clearly stating that the benefit will not be counted for financial eligibility purposes. I should also note that Medicaid won’t deny an application if someone does not apply for VA benefits. That can also be a point of confusion since Medicaid does require applicants to apply for other benefits that they may be eligible for, such as disability.
Another point of confusion is that while the VA benefit is not counted for eligibility purposes, it is included with all other income when determining the amount of contribution towards the cost of care. This is the cost sharing aspect to Medicaid assisted living benefits. How much you pay for your own care and how much Medicaid pays depends on your income. However, once VA receives notification of Medicaid benefits received it will reduce its pension to $90 per month.
As you can see, it’s tough navigating through the long term care system alone. It can cost you literally thousand of dollars a year if you don’t get the right information.