[TFL] Pension poachers profit off benefits meant for elderly veterans, widows

From: TFL@xxxxxxxxxxxxx
To: <RetVet-Info@xxxxxxxxxxxxx>, <TFL@xxxxxxxxxxxxx>
Date: Mon, 16 Dec 2013 21:49:36 -0600
Pension poachers profit off benefits meant for elderly veterans, widows

By Chad Garland Cronkite News Service

Cronkite News Service

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Published: December 16, 2013

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<http://www.stripes.com/polopoly_fs/1.257927.1387215252!/image/image.JPG_gen/der
ivatives/landscape_804/image.JPG> VA pension

A screenshot from the Department of Veterans Affairs' pension webpage. Known
simply as pension, the Department of Veterans Affairs program has been around
since 1979. It pays a financial benefit to wartime veterans with low incomes who
are elderly or totally and permanently disabled from injuries not related to
military service.

 

WASHINGTON  Business is booming in a multibillion-dollar government program
that offers modest pensions to Americas neediest elderly wartime veterans  and
thats not necessarily a good thing.

Lawmakers, advocates and government officials say unscrupulous financial
advisers  pension poachers  are taking advantage of veterans, selling
unneeded services, making promises they cant keep and helping hide assets for
veterans who may then be unable to access their own funds if they need them.

The pitches, often framed as free seminars at elder care facilities, could be
diverting benefits to veterans the program was never intended to help and could
create a backlog of claims applications, critics say.

Its a big scam, said Ingrid Evans, a California lawyer who gets calls
frequently from people in Arizona who say they are victims of these aggressive
practices.

But its perfectly legal.

Known simply as  <http://benefits.va.gov/pension/index.asp> pension, the
Department of Veterans Affairs program has been around since 1979. It pays a
financial benefit to wartime veterans with low incomes who are elderly or
totally and permanently disabled from injuries not related to military service.
Vets and their spouses can get an additional aid and attendance, or A&A,
allowance to pay for help with daily life tasks, like bathing, feeding, dressing
and more.

 

The program was little-known and little-advertised as recently as a few years
ago. When Debbie Burak began looking for help to pay for her parents elder care
in 1996, she said VA representatives did not even acknowledge its existence when
she asked.

But Burak, a Virginia resident who now runs a website providing free information
on the pension program, said that in recent years financial advisers have
started approaching veterans with pitches as slick as snake oil on the
program.

That has led to a boom in the program, which paid 522,000 recipients nearly $5
billion in 2012. While payouts grew only 1 percent from 1999 to 2007, they
jumped 70 percent from 2007 to 2012. Claims for A&A benefits nearly doubled from
2007 to 2011.

Some financial advisers use aggressive sales tactics to pressure elderly
veterans into buying financial products and services they may not need, a
Federal Trade Commission official said.

They use a lot of fear tactics, play on a sense that they (the veterans) served
and should be taken care of, said Monica Vacca, assistant director for the
FTCs Division of Marketing Practices.

One of those tactics is to convince veterans with income and net worth too high
for the program that they can qualify by hiding assets, to look poorer.

A Government Accountability Office investigation in 2012 found that some
advisers told undercover GAO investigators that they could hide as much as
$500,000 or $1 million to bring a veterans apparent worth below the
pension-benefit threshold of about $80,000.

In a statement to the Senate Special Committee on Aging, the VAs Office of the
Inspector General said it is not illegal for veterans to hide assets before they
apply for the benefit. The pension application does not even ask the veteran to
divulge information about transferred assets. The office said it investigated
fewer than 20 cases about pension and A&A benefits from 2000 to 2012, and not
one resulted in criminal prosecution.

The strategy may be legal, but its not risk-free. It creates what one advocate
calls the Medicaid time bomb.

While the VA does not care if someone shelters assets, Medicaid does, requiring
a five-year look-back at the time of application to look for asset transfers.
A veteran who used the tactic to get the pension might be disqualified for
Medicaid benefits, which could be really ruinous, Vacca said.

The strategy can also leave assets tied up where a veteran cannot get them when
theyre needed.

You start seeing things where they try selling a 90-year-old man a $25,000
irrevocable trust or an annuity, said Thom Stoddert, a Seattle-based veterans
advocate and former VA ratings specialist who focuses on A&A claims abuses.

Stoddert said advisers often fail to tell veterans at informational meetings
that they may qualify for other state or federal benefits and programs without
having to hide assets or invest in other financial products.

They focus on just one benefit that the VA has, of many, and there is a
financial reward for them, Stoddert said of financial advisers. When you see
people trying to make veterans eligible for a program that was not intended for
them, thats the first red flag.

Amy ORourke is president of the Cameron Group, a Florida-based geriatric care
management company. She has attended some of the free seminars, but notes that
nothing comes for free where pension poachers are involved.

I went to some of the meetings, and what I observed was they were in the
business to sell annuities, manage assets, ORourke said.

With assets tied up by a poacher, and the potential for Medicaid delays as a
result, veterans or their widows might be left without the float to pay for
unforeseen expenses or increases in the cost of care, she said.

And even though many are VA-accredited, ORourke said the financial advisers are
often unqualified or inexperienced in filing claims and can cause delays or
denial of benefits by completing the forms improperly.

While VA accreditation is often touted by financial advisers, government
watchdogs say it means little, allowing unscrupulous advisers to get certified
to gain veterans trust.

A GAO report in August said accreditation applications jumped 85 percent after a
mid-2008 rule change, and have stayed at the higher level since. The
accreditation process itself is not sufficient to ensure representatives have
good character, said the report, which said VA reviews rely too heavily on the
applicants self-reported background information, such as criminal history.

And the VA is not consistent about following up on references, the report found,
while a backlog in processing annual recertifications means the agency is unable
to ensure that those already accredited retain good character.

Advocates say some advisers have told veterans they are guaranteed the pension
benefit  even though only the VA can make that determination, said John
Roseberry, who has helped veterans with claims as an American Legion
representative in Tucson.

Im not going to promise you anything, Roseberry said of his dealings with
veterans applications. The decisions not mine to make.

Tony Tyczynski, a Sauk County, Wis., veterans service officer, said VA benefit
programs require not only a great deal of knowledge and understanding on the
front end, but even more so on the maintenance side of it.

To put it very, very conservatively, its a very complex benefit, he said.

Like Roseberry, Tyczynski and other county veterans service officers in
Wisconsin help veterans with their benefits for free. Many states offer similar
help and veterans organizations like the American Legion and Veterans of
Foreign Wars also provide help with claims at no cost to the veteran.

But Paul Williams, senior director of government relations for the Assisted
Living Federation of America, said that while there is a problem with pension
poachers, not all financial advisers are bad. And those who specialize in
financial planning for long-term care may be able to offer a take on the pension
benefit that the veterans organizations cannot always match. He said it can be
very difficult finding a veterans organization with the expertise to do A&A
claims.

Its not like Wherever-you-are, USA, that you just call up the American Legion
or some other such support organization and they just have somebody thats
readily available to walk you through the application and do it, said Williams.

He said that in addition to curbing unscrupulous pension poaching, there needs
to be an emphasis on ensuring that veterans advocates are knowledgeable on
pension benefits.

Despite the challenges, it can be worth the fight. Burak said the pension
benefits can provide real help to those who need it.

She only found out about the program after her father, a World War II veteran,
died in 2003. But it could have provided $144,000 of aid in the final seven
years of his life, she said.

She struggled for two more years to get a survivor pension for her mother, whose
finances were so strained she had no way to pay for her own funeral.

My mom knew that the only choice we had at her passing was cremation, and she
begged and begged and begged me to get this money from the VA for a casket,
Burak said, so that she did not have to lay there and anticipate going in an
oven.

After her mother died in 2005  just three weeks shy of completing the VA
pension claims process  Burak started the nonprofit website VeteranAid.org to
provide free information on the pension so no other family would go through what
hers had.

She (her mother) died Aug. 25 and the website was built and launched Nov. 20,
Burak said. It was a way for me to channel all the pain and the anger and the
frustration, and it was also a way for me to rewrite the ending because it was
so painful.


RELATED


·
<http://www.stripes.com/news/veterans/bill-targets-pension-poachers-but-some-wor
ry-it-doesn-t-go-far-enough-1.257925> Bill targets pension poachers, but some
worry it doesnt go far enough

 <http://www.stripes.com/news/veterans> Stars and Stripes' veterans page

 

 

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SOURCE:  Stars and Stripes article at
http://www.stripes.com/news/veterans/pension-poachers-profit-off-benefits-meant-
for-elderly-veterans-widows-1.257922
[TFL] Pension poachers profit off benefits meant for elderly veterans, widows

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