I will assume your Dad was in WWII. If so, you applied for Aid and Attendance. This is not something you get because you apply for it. Her care had to go over the income she receives. She is only allowed to have a certain amt of money in assets. Its hard to get. My Mom was in an AL which cost more than her monthly income, She had under 50k which would have been used up within a year. She was turned down because of something to do with 13k. By the time I got the letter she was on Medicaid and you can't have both.
Different programs in VA have different levels of funding. Insufficient funds may mean that the program has no more funding for the current funding year. VA benefits are not automatically granted to all veteran’s and spouses. If you believe that your mother was denied in error, call a VA benefits specialist.
I can see sufficient funds but unsufficent?