SB 1170 Protects Senior Veterans Involved in the Aid and Attendance Program

Bill Update: SB 1170 (Leno) was signed by Governor Brown on September 27.

CFC Position:  Support

The Aid and Attendance Program is a safety net for low-wealth veterans and their spouses administered by the federal Veterans Administration (VA) that pays for medical supplies or in-home healthcare. 

To qualify for the program, a veteran and his or her spouse must have liquid assets under $80,000, need significant medical assistance, and had to have served 90 days in the military with at least one day being during wartime.  The program reimburses low-wealth senior veterans for the medical assistance not reimbursed by their health care up to a certain threshold, which is based on certain factors such as the number of people in the household.  

Unethical financial agents, who sometimes claim to be senior or veteran investment experts, target high-wealth veterans who otherwise would not qualify for the program but might see it as a way to pay for their steep medical costs.  For the veteran to appear to be low-wealth to qualify, the agents often advise the seniors to put their money into financial holdings such as irrevocable trusts, where the veteran no longer has control of the money.  

Such financial overhauls can cause trouble for the senior veterans.  Usually the irrevocable trust includes annuities that the investor cannot touch or pay out over a long period of time, and come with a high sales commission for the agent.  Senior veterans who use this process, also, might find themselves getting their Medi-Cal benefits revoked.  The Aid and Attendance Program does not look at past assets when reviewing an application, but Medi-Cal does.  When they see the money that the veteran has hidden, Medi-Cal may rescind benefits.

SB 1170 would help protect senior veterans and the Aid and Attendance Program by placing restrictions on how a financial agent may approach potential senior clients. 

SB 1170 will prohibit the use of misleading words and logos that are similar to those used by legitimate veterans organizations and agencies; prohibit the use of the term ‘veteran’ on business cards and marketing materials used by insurance agents (i.e. ‘Veteran Benefit Specialist’) unless that title or designation has been approved by the state Insurance Commissioner; require disclosure when veterans events are not endorsed or sponsored by the VA, the California Department of Veterans Affairs, or other Congressionally chartered or recognized veterans organizations; and prohibit the delivery of legal documents such as trusts by insurance agents. 

These prohibitions will keep the Aid and Attendance program for those who actually need it: low-wealth senior veterans and their spouses.