VA, We Have a Problem – Yes, Another Problem

It’s no secret that the U.S. Department of Veterans Affairs (the VA) has had its share of problems in recent years.  In some areas, revelations of the scope of these problems have led to improved care.  (I can vouch for this – my brother-in-law is a veteran, and in recent months, the quality and responsiveness of his care has improved dramatically.)  That’s unquestionably good news.

But it’s not rosy on all fronts.  There is a little-known VA program, called Aid & Attendance and Housebound, that is designed to help pay for the care of disabled vets (and their spouses) who cannot take care of themselves.  This includes skilled nursing and assisted living care. The eligibility formula takes into account the vets’ income and health care costs, and pays up to $2,054 a month (for a vet) or $1,114 a month (for a surviving spouse).  That’s not nothing.  Indeed, an eligible vet who spends his last five years in assisted living and then skilled nursing care would be entitled to nearly $125,000 to pay toward that care.  And that’s not all – the benefit is retroactive, meaning that an eligible vet (or his or her spouse) will get a lump sum representing all of the months that have elapsed while processing the application.

Then what’s the problem?  Well, as this excellent article points out, the waiting times to be declared eligible are enormous.  And as this great first-person account notes, the application process itself is Byzantine at best.  Applicants must submit dozens of documents, and once they do, they can expect their applications to take six to nine months – if everything goes right.  What if everything doesn’t go right?  Gulp.  You’re looking at potentially years before the appeal works its way through the process.  Oh, and if the eligible vet (or his or her spouse) dies before the application is ultimately approved, it’s unlikely that the vet’s children will be able to collect anything more than the costs associated with the last illness and funeral.  Sure, it might be the case that the last illness was the one that put the vet in the skilled nursing or long-term care facility in the first place, but it might not.  If not, the children (or the facility) won’t be reimbursed whatever they paid out-of-pocket for that institutional care.

This is not a trivial concern.  It’s notoriously hard to find statistics on life expectancy compression upon admittance to a skilled nursing facility, but some studies indicate it may be more than 50 percent by the end of the first year.  That is tens of thousands of dollars per resident that could be used for care but instead is left on the table.  And if the facility is the one providing the care with the expectation of reimbursement from the Aid & Attendance program?  Multiply the tens of thousands of dollars by the number of patients it’s doing that for, and you get a big number pretty fast.  And it’s not just the family or the facility that may be out that money – insofar as state Medicaid is paying for the care, it’s out the money, too.

So what to do?  Publicity lit a fire under the VA with respect to disability benefits.  Maybe it will have the same effect for vets eligible for the Aid & Attendance program.  On the other hand, these vets generally aren’t the ones getting a bum deal – whoever is paying for their care is, and children seeking to collect tens of thousands of dollars to reimburse themselves (or a long-term care facility doing the same) aren’t as sympathetic as a wounded or disabled vet trying to get care.  If public shaming won’t work, what’s left?

The answer – potentially – is litigation.  The first obvious objection for the lawyers out there is that the applicants must be required to exhaust that same Byzantine appeal process before going to court.  Right?  Not necessarily.  One prominent exception to the exhaustion requirement is futility – a plaintiff need not exhaust administrative remedies if doing so will be futile.  What could be more futile than a likelihood that the applicant will be dead (with most benefits lapsing) before the appeal is resolved?  I may have more on this later.