What is the VA Improved Pension?
The History
The Veterans Administration program for veterans with disabilities (whose disability is unrelated to their military service) is called Improved Pension. Prior to the development of this program on January 1, 1979, this program was called different names, including Section 306 Pension, Old Law Pension, or Pension.
Who can Apply?
The person applying for benefits is called the “claimant.” The claimant may be the veteran, a surviving spouse of a deceased veteran, or a dependent child of a deceased veteran.
Service Requirements
The Service Requirements for a pension benefit are: 1) Status as a veteran; 2) with at least 90 days of active duty service; 3) one day of which was during a period of wartime; and 4) a discharge that is other than dishonorable.
Veteran Status: This program is available to veterans. A veteran is “a person who served in the active military, naval, or air service”[1] and was “discharged or released under conditions other than dishonorable.”[2]
Wartime Service: The veteran must also have engaged in wartime service. This requirement has two components. First, the veteran must have had 90 days of continuous active duty, if that service occurred before 1980 or 24 months if the service occurred after 1980.[3] Second, at least one day of that continuous active duty service must have occurred during a declared wartime period.[4] The current wartime periods are as follows:
| World War II | December 7, 1941 – December 31, 1946 |
| Korean War | June 27, 1950 – January 31, 1955 |
| Vietnam War | August 5, 1964 – May 7, 1975 February 28, 1961 – May 7, 1975 [if served in Vietnam] |
| Persian Gulf War | August 2, 1990 – [date not yet determined] |
The VA also provides a benefit for surviving spouses or dependent children of veterans. In order to be eligible, the deceased veteran must have met the Service Requirements as outlined above for pension.[5]
Can a Surviving Spouse receive a Pension?
In order to be eligible for a Survivors Pension, the surviving spouse must have been validly married to the veteran at the time of the veteran’s death.[6] The surviving spouse must have been married to the veteran for at least a year and not have remarried since the veteran’s death.
Can a Surviving Child receive a Pension?
A surviving child may be eligible for the benefit if:
- The veteran met basic eligibility for service pension;
- The child is not in the custody of an eligible surviving spouse;
- The child is the biological, adopted, or stepchild of the veteran;
- The child is unmarried;
- The child is less than 18 (23 if still in school) or is disabled and was incapable of self-support due to a disability that arose prior to the age of 18 years.
Maximum Annual Pension Rate (MAPR)
For a Veteran as the claimant, the following rates apply in 2014:
| Maximum Annual Rate | Monthly Benefit Amount | |
| Service Pension | $ 12,652.00 | $ 1,054.33 |
| *Plus one dependent | $ 16,569.00 | $ 1,380.75 |
| Service Pension with Housebound Allowance | $ 15,462.00 | $ 1,288.50 |
| *Plus one dependent | $ 19,380.00 | $ 1,615.00 |
| Service Pension with Aid & Attendance Allowance | $ 21,107.00 | $ 1,758.92 |
| *Plus one dependent | $ 25,022.00 | $ 2,085.17 |
| Each additional dependent | $ 2,161.00 | $ 180.08 |
For a Surviving Spouse of a Veteran as the claimant, the following rates apply in 2014:
| Maximum Annual Rate | Monthly Benefit Amount | |
| Death Pension | $ 8,485.00 | $ 707.08 |
| *Plus one dependent | $ 11,107.00 | $ 925.58 |
| Death Pension with Housebound Allowance | $ 10,371.00 | $ 864.25 |
| *Plus one dependent | $ 12,988.00 | $ 1,082.33 |
| Death Pension with Aid & Attendance Allowance | $ 13,563.00 | $ 1,130.25 |
| *Plus one dependent | $ 16,180.00 | $ 1,348.33 |
| Each additional dependent | $ 2,161.00 | $ 180.08 |
Disability Requirement
There are three levels of disability for three types of Pension Benefits: 1) Service Pension; 2) Housebound Allowance; and 3) Aid & Attendance Allowance.
Service Pension: The lowest level of pension benefit is called Service Pension. A claimant will meet the disability requirement for this level if they have been determined to be disabled.[7] A claimant is automatically determined to be disabled if they are age 65 or over, in a nursing home, or has been determined disabled by the Social Security Administration.[8] In order to show that a claimant is permanently and totally disabled if the claimant is not over the age of 65, living in a nursing home, or determined disabled by Social Security, the claimant must show that he or she is unemployable due to a medical condition, and the unemployment situation is reasonably certain to continue throughout his or her life.[9]
Housebound Allowance: A claimant is considered to be housebound if “substantially confined” to the home or immediate premises due to a disability, which is reasonably certain to remain throughout the claimant’s lifetime.[10] A claimant can make a showing if he or she can prove the requirements for Service Pension and also that he or she is substantially confined to the home. The VA will consider a private physician’s statement or a hospital or examination report from any governmental or private institution.[11] In short, medical evidence is required to substantiate this claim.
Aid and Attendance Allowance: A claimant requires aid and attendance if he or she requires the regular aid of another person to perform activities of daily living.[12] Activities of daily living include: bathing, dressing, and attending to the wants of nature.[13] The need for assistance does not need to be permanent. If a claimant is not in a facility, the claimant may be cared for at home, so long as the care services are prescribed by a healthcare professional such as a doctor, RN, LPN, or licensed physical therapist.[14] The professional must consult, in person or by telephone, with any unlicensed caregiver at least one a month to monitor the prescribed regimen.[15]
Needs Requirement
If a claimant meets the above service and/or familial status requirements and/or disability requirements, then the VA will then consider the Income and Assets of the Claimant to determine if the Needs test is met.
The needs test is comprised of two components: 1) Income must be less than the MAPR as determined by the VA (see table). For instance, the current MAPR is $ 12,652.00 annually. The veteran’s total gross income must be between $0.00 and $12,652.00 to receive a benefit, and the actual income received will reduce the income benefit dollar for dollar.
For example, a veteran who receives $10,000.00 per year of income, his annual benefit will be $2,652.00.
It is important to know these facts about how VA considers income:
- Income is defined as payments from any source;[16]
- Gross income is counted (not net income);
- “Quasi household income” is counted – includes spouse’s income but not children in the same household unless those children are “dependent children.”
- Income is projected on an annualized basis.
Countable income is what matters, also known as IVAP (Income for VA Purposes). Gross income is reduced by permissible exclusions, but most of the exclusions are very specific. However, the most often used exclusion is the unreimbursed medical expense exclusion.[17] Unreimbursed medical expenses are most any expense related to medical or long term care that was paid for without reimbursement from insurance, Medicare, Medicaid, or any third party. The expenses must also exceed 5% of the MAPR. These are also calculated on a prospective, annualized basis. The VA typically accepts anticipated costs of nursing homes as clear and reasonable expenses that can be deducted from the claimant’s income.
Net Worth requirement:
If the claimant meets the income aspect of the needs test, he or she must next show that his net worth is not a bar to benefits. The VA will not provide benefits when the claimant’s estate is such that, under all circumstances, considering the claimant’s income (and the spouse’s income, if applicable) that it is reasonable that some part of the estate be consumed for the veterans’s maintenance. There is no clear-cut limit or maximum net worth allowed. Rather it is a subjective, flexible standard evaluated on a case-by-case basis.
Hypothetical:
John is a WWII veteran, where he served for 2 years. He is widowed. John receives $3,500 per month from his Social Security and pension and he suffers from dementia. He currently requires daily care in his home to assist him with activities of daily living. The cost of this care is $5,500 per month. His assets include: a prepaid burial plan, term life insurance of $250,000, $62,000 in his savings account, and his home worth $450,000.
Will John qualify for any pension benefits?
It is likely in this situation that John will qualify for Aid and Attendance since he requires daily care with his activities of daily living.
If so, how much will John receive each month?
Since John’s medical expenses exceed his income, he should qualify for the highest Aid and Attendance benefit for a single veteran with no dependents. In 2014, this amount is set at $1758.92 per month or $21,107.00 per year.
[1] 38 USC 101(2).
[2] M21-1MR Part III Subpart ii Chapter 6.1.
[3] 38 USC 1521(j).
[4] M21-1MR Part V Subpart I Chapter 1.2.b.
[5] 38 USC 1541(a).
[6] 38 CFR 3.50(b)
[7] 38 USC 1502(a).
[8] 38 USC 1502(a)(1).
[9] 38 USC 1502(a)(4).
[10] 38 USC 1502(c).
[11] MR21-1MR Part V Subpart I Chapter 2.2.a.
[12] 38 CFR 3.352(5).
[13] M21-1MR Part V Subpart ii Chapter 3.1.
[14] 38 CFR 3.352(2).
[15] Id. at (3).
- [16] 38 USC 1503(a); 38 CFR 3.271(a).
[17] 38 USC 1503(a)(8).