VA Policy on Whether Room and Board Expenses at Senior Residential Facilities Qualify as Unreimbursed Medical Expenses for Pension Purposes

In Fast Letter 12-23, VA clarified its policy regarding whether the cost of room and board at senior or independent living facilities qualifies as an unreimbursed medical expense (UME) that can be deducted from income for pension purposes. VA policy is that the cost of room and board at such facilities is only a UME when the facility provides “custodial care” – which involves assisting with activities of daily living (ADLs). VA defines ADLs as “basic self-care and includes bathing or showering, dressing, eating, getting in or out of bed or a chair, and suing the toilet.” 38 C.F.R. § 4.124a note 3. A facility provides custodial care for VA purposes if it assists a person with two or more ADLs. The cost for room and board at these types of facilities can also qualify as a UME if a person’s physician states in writing that the person residing in such facility requires (and contracts for) custodial care from a third-party provider. Costs for assistance with meal preparation, housework, shopping, laundry, etc., are not UMEs for pension purposes because these are not medical or nursing services. VA will, however, deduct these costs from the individual’s income when that person receives pension at the “aid and attendance” or “housebound” rate, or a physician certifies that the person needs to be in a protected environment, AND the facility also provides medical services or assistance with ADLs to the individual.