Mentally Incompetent Veterans Become Victims of Budget Ax : Entitlements: A little-known rule ends payments to some who need full-time care. Kinships and savings are determining factors.

Chauncey Corwin, nearly 100 years old, has been mentally incompetent since he was gassed during World War I. The government has discontinued his veteran’s disability benefits in the latest efforts reduce the federal deficit.

“How can I tell him, ‘Chap, they’ve stopped your veteran’s payments’?” asked Joyce Ackerman, who has looked after Corwin for more than 20 years.

“President Bush is giving extra benefits to Desert Storm veterans, but what about my vet, who gave his life?” said Ackerman, the widow of Corwin’s cousin. She and her husband found Corwin living in a Florida institution in the late 1960s and took him into their home.

Corwin, now in a nursing home in Fredericksburg, Va., is one of 11,400 incompetent veterans deprived of disability checks under a statute buried in the five-year deficit-reduction budget Congress produced last fall.

The rule cuts off disability payments to incompetent veterans who have no dependents or parents and who have property worth more than $25,000. Payments resume when their assets fall below $10,000.

Linda Stalvey of the Department of Veterans Affairs said the measure was taken because in some cases, “remote heirs” of veterans inherited windfalls, and this “defeated the intent of helping the veteran in his lifetime.”

She said that suspending the payments will save the VA $125 million in fiscal 1991--a large portion of the $620 million in cuts the department was required to make under the budget package.

John F. Heilman, national legislative director of Disabled American Veterans, a nonprofit group with more than 1 million members, said that distant relatives sometimes took advantage of incompetent wards. Those who will suffer most, he said, are parents, siblings and children who have made sacrifices to secure the financial and physical well-being of family members.

“It’s not the business of the government who this money goes to,” Heilman said. He added that in the end, the taxpayer will save little, because people will have to turn to Medicare or other programs if VA funds are cut off.

Ackerman said the $1,800 a month Corwin was getting went entirely to pay his nursing home expenses. And the $100,000 nest egg built up for him over years of saving will go quickly if he needs extended hospital care, she said.

The disabled veterans’ group challenged the constitutionality of the cutbacks in a class-action suit in February. The suit alleges that singling out the mentally incompetent violates their right to equal protection under the law.

“It’s a classic case of Congress doing something without really thinking about it,” said Joanne D’Alcomo, one of the attorneys representing DAV and the 13 plaintiffs named in the New York District Court suit.

The families of those losing benefits “view this as a real slap in the face,” D’Alcomo said, particularly at a time when the nation is honoring and helping others just returning from service.

Josephine DeCasperis said she and her husband, Albert, promised his mother before she died that they would never put Albert’s incapacitated brother in an institution. Peter DeCasperis has been unable to care for himself since he suffered sunstroke in a 1957 Army training exercise that killed two other recruits.

Peter’s compensation check has covered the nearly $2,000-a-month cost of his live-in attendants. Mrs. DeCasperis said they fear the day will come when they can no longer give Peter a home.

“It’s so unfair!” she said.

Another plaintiff, Larry Simpson of Fredericktown, Pa., suffered debilitating brain damage in the 1983 terrorist attack on the Marine Corps barracks in Beirut. He can work a few hours a day in his mother’s restaurant, but needs more brain surgery and will never lead an independent life.

Anna Simpson, his mother and guardian, said the VA had always encouraged her to save Larry’s disability payments for future needs, and his estate had grown to $25,100--just $100 above the new limit.

“I come from a military family, and I always thought that if you keep your mouth shut the military will take care of you,” said Mrs. Simpson, who has a brother serving in Saudi Arabia. “I found out that this was not true.”

Reps. Robert K. Dornan (R-Garden Grove) and H. Martin Lancaster (D-N.C.) in March introduced a bill to repeal the cuts. The Senate has passed a nonbinding resolution recommending that VA compensation to incompetents be restored.

“They realize they’ve done something philosophically terrible,” said Heilman of the DAV.

But he said the measure would be difficult to repeal because it was part of the deficit-reduction package. Heilman predicted that, at most, Congress will refuse to go along with a Bush Administration plan to extend the law, slated to end in September, 1992, to 1995.

Rep. G. V. (Sonny) Montgomery (D-Miss.) chairman of the House Veterans’ Affairs Committee, told Ackerman in a letter that “while most of us don’t feel comfortable” with cutting benefit entitlements because of budgetary pressures, “in this case I have to tell you we had little in the way of options.”