You helped your veteran client obtain eligibility for veterans pension with aid and attendance. The application was filed, all verification materials were submitted, and you wait for an answer. The good news is, your client was awarded with benefits. You feel really good about helping veteran clients. You feel even better when the Veterans Administration approves a claim for one of your clients.
But then the call comes in. The client is calling to ask you why they haven’t received any money.You review the award letter and it clearly states that the veteran will begin receiving the maximum award of $1,949 per month beginning the month after the date on the letter. However, it appears that the VA is “withholding the release of funds for the retroactive, lump sum payment” that is due for the past 10 months (or more). This is the amount due from the month after the application was filed through the date of the award.
For claimants who are mentally competent and there is no evidence in the medical records that indicate the person can’t manage their own financial affairs, they will receive their monthly income payments, including the retroactive back pay, immediately upon application approval. The first month and the retroactive check will come through the mail. Subsequent monthly checks will be automatically deposited into the claimant’s bank account if one was provided in the application.
Many elderly clients seeking pension with aid and attendance are not competent to manage their own financial affairs, usually due to dementia or Alzheimer’s disease. These claimant’s will receive a letter of notification saying “there is indication in the file that you may not be competent to manage your own financial affairs” and the letter then gives the claimant the option to ask for a fair hearing to determine capacity or to waive the fair hearing. If the person requests the hearing, the approval process and payment will be delayed a very long time while waiting for a hearing to be scheduled and then ruled upon. It is generally best for the claimant to waive the request for a hearing and specifically ask the VA to process the award as soon as possible.
The Fiduciary Process
Once the VA has indication that the claimant may be incompetent, a VA Field Examiner (“FE”) will conduct an Initial Appointment (“IA”) field examination to assess the competency and welfare of the beneficiary, and determine whether the beneficiary should receive benefit payments directly, but with VA supervision as a supervised direct payment (SDP) beneficiary, or through a fiduciary. 
It is recommended that the claimant nominate on VA Form 21-4138, Statement in Support of Claim, who the claimant wants as the fiduciary. This is usually a family member. If the claimant has a competent spouse who can act as fiduciary, the VA may forgo the field examination evaluation altogether. However, the VA may also choose to do the evaluation regardless who the claimant nominates.
The delay in the system appears to be getting a field examination appointment. There are very few field examiners as compared to the number of outstanding claims. Once the field examiner completes the evaluation, then a report must be generated, sent to another VA representative for approval, and then sent to the paying authority to make payment.
Fortunately, the monthly payment from the date of the award letter and on-going will be paid, it is only the retroactive payments that are delayed.
Because most of our clients are elderly and frail and have been paying down their assets on health care expenses, receipt of the lump sum retroactive payment is essential to on-going care. Therefore, with all of our claims that have been approved but not paid, our office contacts the VA Pension Management Center that covers our region on a monthly basis to follow up on the status of the award payment. Moreover, if the claimant dies before the payment is issued, the VA may not make any payment at all depending on whether the claimant had any qualifying family members who could receive the payment after the claimant’s death.
Remember, it is required that anyone who assists a claimant with a VA application must be accredited by the VA unless you are a one-timer (i.e. a family member helping another family member). When seeking representation, be sure to ask whether the person is accredited by the VA. Also, it is illegal for anyone to charge a fee to assist with the application process.
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