A written Caregiver Agreement is a good idea for family members who want to protect family harmony, and make sure everyone in the family understands how care is being provided to an elder.
A family care giver can save an elder from needing nursing home services, and may protect assets from nursing home expenses in the future. Elders who want to protect their assets from nursing home care costs and qualify for Medicaid, should consider setting up a Caregiver Agreement whenever adult children and other family members are providing valuable care. But the agreement cannot be a last minute deal among family members.
But these agreements must be carefully prepared, in case the elder eventually needs Medicaid eligibility to pay for nursing home care in the future. A Superior Court decision issued on February 19, 2010 rejected a Mother - Son caregiver contract that was intended to protect $182,000 for the mother's care. The Superior Court judge declared that the care agreement was invalid. At the time it was executed the mother did not have mental capacity, and there was no conservator appointed to act on her behalf. Thus, the court had no evidence to suggest that the transfer of money to her son was in her best interest, or that it was intended to pay for her care pursuant to the Care Agreement.
So, the family that provided round the clock elder care at home could be left with a $182,000 Medicaid transfer penalty. Even though her son intended to keep his mother comfortable and safe in his home, he could not meet the burden of proof required to persuade the Medicaid hearing officer that his mother intended, at the time the services were rendered, to pay for the work. There was nothing in the record to demonstrate her intent at the time she transferred the money to her son. Read the case. A 2007 Massachusetts Appeals Court case (Andrews v. Division of Medical Assistance) had already established that caregiver contracts for past services will not be acceptable.
These cases illustrate the reasons to consult an elder law attorney to protect your interests if family members are providing valuable elder care services. Medicaid in Massachusetts has issued a memo that requires that all Care Giver contracts be reviewed by the Office of Medicaid legal department in Boston.
During its 2010 session, the Massachusetts Legislature rejected a proposed law that would set guidelines for elders who pay their family members for home care and other services. The proposed Personal Care Contracts law, HB 536, was intended to protect the elders from incurring a transfer penalty if they need to apply for Medicaid nursing home benefits. The Office of Medicaid urged the Legislature to restrict personal care contracts, based on restrictions imposed in other states, such as:
- strict limits on reimbursement rates: commensurate with services paid to unlicensed persons, such as $10 per hour allowed in Vermont or federal minimum wage allowed in Kansas
- require the elder to document personal care contract services; New York expressly presumes that all resources were transferred for the purpose of establishing eligibility for Medicaid and requires the member to supply convincing evidence to the contrary
- require that services be rendered before payments are made rather than advance payments for services to be provided in the future
- allow only reimbursement for services recommended in writing by a physician (as required in Maine)
- limit the total amount paid for care to no more than $30,000 (as in Vermont)
The Medicaid Director claimed that Massachusetts families provide elder care services worth between $54 - $164 million every year, and that these amounts would somehow affect the Medicaid budget when elders later enter nursing homes. No details were given on how the Office of Medicaid reached this conclusion. Read Complete Letter.>>>
The proposed Act to Help Families Care for Elders will be reintroduced in 2011. Until the Massachusetts Legislature passes the new law, it is important to properly document agreements for care provided by family members.
The care that you provide can range from part time services to 24 / 7 care and supervision of professional paid care givers. If an adult child or daughter in law takes responsibility for meeting an elder's needs, a caregiver contract can protect the value of those services from being ignored by MassHealth. The agreement between the elder and caregiver should cover:
- the care giver’s tasks and duties
- times and days the care giver performs the service
- care giver's responsibilities for supervision of other care givers
- reimbursement for expenses covered by the caregiver
- the elder's role as an employer who pays wages
- wages paid to the caregiver comparable to local home care companies
The care giver contract can help you and your family to:
- recognize and reward the time and effort that each family member puts in to care
- provide an organized schedule for care and other services
- prevent arguments and misunderstandings among family members
If the care giver agreement is accepted by Medicaid, it can reduce the size of an elder’s estate, and allow earlier eligibility for Medicaid long-term-care nursing home coverage. Call us at 567-5600 if you would like us to prepare a Caregiver Agreement that suits your specific needs.
