A VA program can help many seniors, but there may be sharks in the water.
By Rick Grimes
Most senior living professionals are aware of the U.S. Veterans Administration Aid & Attendance (A&A) program intended to provide financial support to veterans and/or their spouses who need assisted living and other healthcare services.
This is a benefit, established for all veterans in 1873, that today provides up to $2,200 per month. In many cases, this is enough to make it affordable for a veteran and/or spouse to move into a senior living community and benefit from the care and services provided by the senior living business.
Unfortunately, most veterans are not aware of the program and many, when reflecting on the monthly costs of senior living believe, wrongly, that they can’t afford to live in a senior living community.
Financial abuse concerns
But ignorance of the A&A program is not the only problem. Even if veterans and their families are aware of the program, it is almost impossible for an individual to maneuver through the VA’s vast bureaucracy to obtain the benefit.
In the ideal world, a family member of a veteran needing assistance could call the VA, provide information about the veteran and — before hanging up — know that a monthly check would be on the way to supplement the veteran’s social security or other resources.
In the real world, however, there are extraordinary obstacles placed before the veteran and his family by the VA. It seems that many just give up.
Because of this problem, there developed over many years a cottage industry of financial “experts” promising to help eligible veterans get this earned benefit. In too many cases, many would promise the benefit but instead offer other unnecessary financial services.
For example, an “expert” may sell the seniors annuities or other financial products, charging them for financial “consultation.” In some cases they even take control of the veteran’s financial portfolios. That is, some of these financial experts grew businesses that lined their pockets at the expense of the senior. Have you heard about the 90-year old resident who was sold a 10-year annuity?
In the summer of 2012, these abuses caught the attention of the U.S. Senate Special Committee on Aging, which promised to hold hearings and do something about it.
Before the hearings began, some members of the committee were convinced that the senior living business was in cahoots with these financial companies and their unethical practices. This arose from the fact that many community executive and activity directors, eager to find educational programs and activities for their residents, allow financial advisers to put on free seminars
It was during these seminars, said the Senate committee, that financial predators would identify veterans, promise the benefit, and co-opt them into other, unneeded financial products or services. Fortunately, the Assisted Living Federation of America (now Argentum) was able to impress upon most committee members that senior living businesses were victims as well.
During the hearings, all of us sat stunned to learn the extent of the financial abuse and the tragic stories of how individual families and veterans had been ripped off. Of course, as a veteran myself and the son of a veteran who was in his 90s at the time, this also became very personal to me.
Unfortunately, nothing came of these hearings. Today, six years later, many of these abusers are still in business.
So how do you protect your residents, their families, the reputation of your company and yourself against litigation?
Creating a defense
After making an assessment of how many veterans and spouses are currently living in your communities and how many receive the earned A&A benefit, you’ll have a pretty good idea of the potential for new resident move-ins who may qualify. Brookdale Senior Living, for example, completed a study showing that 41 percent of its residents nationwide were veterans or spouses of veterans.
To ensure your residents and potential residents aren’t victims of financial fraud, you may want to consider the following:
Make protecting your residents and potential residents from predatory financial advisors and companies a very high priority.
Many providers believe that a resident’s finances and financial choices are personal, and operators would prefer to keep those topics at arm’s length. However, while most financial companies and individuals are honest and ethical, there are predators out there.
Residents living in your communities who are abused by others not only reflects poorly on your company, but also exposes your company to litigation. Did you hear about the 85-year-old brothers whose signatures were forged when they balked at purchasing a million-dollar annuity from their new financial advisor?
Centralize control at the corporate or regional level. From there, vet financial experts and companies who want to represent your company to your residents, or put on free seminars for your residents. That is, while you may want an activity director to make decisions about appropriate educational activities, financial seminars need a much higher level of scrutiny than, say, a seminar on World War II or how to use an iPad.
It’s important to note that there is no money in A&A. It is against the law to be paid for providing this service to an individual. What then, would you suppose, is their motivation for wanting to present at your community?
If you are comfortable with a financial expert or company who promises the VA benefit (and may also provide other valued services), you’ll want to track their record of success with A&A.
How many veterans or spouses end up receiving the benefit because of their work with that financial expert or finance company? If you are already using a company to help acquire the VA benefit, insist that they show you their record of success. If they don’t have a 90 percent or better record of success with your current or potential residents, dump them and find someone else.
Finally, it is important that you work with your professional association — Argentum, ASHA, NIC or LeadingAge — to help prevent financial abuse. These organizations have partnered with the Financial Industry Regulatory Authority (FINRA) to provide free materials to executive directors and to take other actions to reduce the financial abuse of seniors.
According to NIC, up to $50 billion is lost annually to fraudulent financial schemes. Abuse in the guise of helping get the A&A program is only one aspect, but it is an important and significant one.
Being attentive to potential financial abuse perpetrated upon your residents or potential residents is the right thing to do for your company and for America’s seniors.
Rick Grimes is past president and CEO of Argentum. He is also a combat veteran committed to veterans’ causes and remains passionate about the good works of the senior living business.