Jim,
My 97 year old mother in law, widow of a WW II veteran, has significant dementia and has just been granted VA benefits on her husband's WW II service. Her doctor states that she is unable to handle her finances. The widow has submitted a request for a competency evaluation in order to obtain 3 months of retroactive benefits, but now the family is having second thoughts of pursuing the retroactive benefits and the VA pension due to scary stories we have heard.
Her daughter has power of attorney, but is not a court appointed guardian. The only monies my mother in law has is Social Security and a reverse mortgage. My mother in law has 24/7 care in her home and may run out of the reverse mortgage money in 3 to 4 years. Since her expenses and care are a lot more than she received from SS and the VA pension, the family will have to sell the house and put her in a nursing home. And when that money runs out, file for Medicaid.
Even though the daughter meets the qualifications as far as I can determine from reading the VA Fiduciary Overview page, the VA may appoint a stranger as a VA fiduciary. Is it possible that the VA would initiate action to start proceedings to appoint a court ordered guardian for all her other finances too?
If my mother in law does not cooperate with scheduling a competency interview, my guess is that they will suspend benefits. Will any other action take place such as initiating a court appointed guardianship? Even though my mother in law has limited funds, it may be preferable to not have the VA pension if it involves a fiduciary or guardian other than a family member.
Reply:
The situation you describe can be very complex. VA will only have an interest in VA money. If there are mixed funds in the bank account that the VA money is deposited to, VA may take control of it all and say they don't know which money is which so it's all theirs. I advise vets to set up one single account that has only VA money in it. The VA will not try to have a guardian appointed.
Her daughter should go ahead and become the (state) court appointed guardian. VA won't recognize that officially but it may help.
In theory, a veteran (or other beneficiary) doesn't have the right to refuse to cooperate with the appointment of a fiduciary. However, there are veterans and families across America who are doing exactly that. They are refusing to allow the field examination to occur.
The usual first step in the appointment of a fidu is the home visit by a VA field agent. If the veteran or family caregivers don't allow the visit, the process is stopped, at least temporarily. VA can't appoint the fidu until the visit is completed and if you don't allow the visit, that really confuses VA.
>From what I'm seeing, all that VA can do is to hold up any retroactive pay if that happens. They are required to make regular monthly payments until they can get the field visit completed but they can hold onto the back pay. They will then try to persuade the family to allow them to complete the visit but they have a hard time enforcing that. There are cases winding through the federal courts today and the courts aren't happy with how VA conducts this business.
In one case that I've been involved in for many years now, the VA has withheld about $50,000.00 in retro pay for about 3 years. But...the monthly payment of about $4000.00 comes regularly and has been deposited the entire time with no problem. That family recognizes that if VA were able to appoint a fidu, even a family member, they wouldn't be allowed to spend any of that back pay. When the veteran dies, any remaining money in a bank account will return to VA. VA does not disburse VA money to beneficiaries upon death unless they are dependents.
Keep in mind that what I'm telling you is not legal advice. If you refuse to cooperate with VA, technically that is against the law.
However, any applicable laws have no teeth and meany people today have had it with how VA runs the fidu program so they are refusing to cooperate and they're doing just fine. Every one of them who refuse to cooperate are people just like you who have an aging relative with dementia. The fellow who is owed about 50 large is now 92 years old, and he gets his monthly check and all his retirement benefits and good VA health care. His family will not allow VA to set a foot inside their home for the interview.