Is the Cost of Independent Living Considered an Acceptable Medical Expense When Applying for VA Pension?

There is much confusion about whether or not the cost
of ANY facility is still considered by the VA as a medical expense to
offset total household gross income for VA pension purposes. VA Fast Letter
12-23, dated October 26, 2012, was intended to clarify this issue as it relates
to independent living facilities. Unfortunately, like with many government
explanations, the issue is still very confusing to many people.

Although this Fast Letter was intended to explain the
costs associated with independent living, many VA adjudicators are applying its
rules to assisted living facilities as well. The old saying, "When in
Rome…." is very applicable to the VA in that it is easier to go ahead
and err on the side of caution by assuming that the rules apply both
to independent living and to assisted living facilities than it is to
argue the point later.

The Fast Letter does allow the cost of room and board as
an acceptable medical expense provided that the individual (which may be a
claimant or dependent) has been rated either Aid and Attendance or Housebound
AND either the facility or a third party is providing "custodial care";
i.e. assistance with two or more acceptable Activities of Daily Living (ADL).

The two supporting evidence documents which can generate
either an award OR a denial are the Care Expense Statement (or other similar
facility/caregiver affidavit) and the doctor's affidavit (form 21-2680). Errors
or lack of relevant information on either of these can be detrimental to the

There are two ways that the entire facility cost
(including room and board) will be allowed as unreimbursed medical expense
(UME). Both of these require that the doctor confirms the need for a
"protective environment" and that the doctor confirms the need for
"custodial care" in the form of assistance with two or more of the
following: bathing or showering, dressing, eating, getting in or out of bed or
a chair, or using the toilet (including incontinence care). Medication
monitoring is no longer acceptable as an UME, but is certainly worth
documenting to "add icing to the cake".  These two ways are:

1. The facility is providing the custodial care
(assistance with two or more ADLs as defined above), OR

2. A third-party contractor is providing the custodial
care and the doctor has confirmed the need to live in that facility to obtain
the third party caregiver's assistance. The Fast Letter does not stipulate that
the third party caregiver must be a paid caregiver or a licensed professional,
as long as the individual is rated either Housebound or A & A.

In either of the above scenarios, it is suggested that
the doctor state the need for:

1. A "protective environment", and

2. The need to live in that particular facility (naming
the facility), and

3. The need for two or more of the acceptable ADLs, and

4. The need for a third party caregiver to provide the
custodial care (I prefer naming that caregiver) if such a need exists

As in any government agency, the VA has its own rules,
regulations, and idiosyncrasies. We as care professionals must simply learn to
stay within those rules and regulations for our clients.


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