If you are providing care to your parent, you are more than likely doing it without being asked and without compensation. It probably isn’t on your mind at all. But, I can tell you as an elder law attorney, it should be.
As a society, we value our elders and provide the care they need without being asked, just as they did for us. In most cases, the last thing on a caregiver’s mind is being compensated for their time. We value your commitment. You should know that getting compensation for helping them might benefit everyone in the long run. This is because paying you may help them become eligible for Veteran’s benefits or Medicaid – and once eligible, they can get the professional care they need.
The Veterans Aid and Attendance Benefit and Medicaid are both means tested benefits. If you have too many assets (money or property) you would not be eligible. To become eligible, you must “spend-down” assets to a certain level. Paying you, as the caregiver, is a perfectly legal way to do that. However, it is best to set up a caregiver contract to keep the terms of the agreement clear.
The caregiver contract should be carefully drafted so that there is no confusion about whether your parent simply gave you the money. (Medicaid will look back five years to see if the recipient gave away money to become eligible – a BIG no, no!) However, if the money is earned in exchange for providing caregiver services, then it is acceptable.
Please consider these points when creating a caregiver contract:
- Contact an experienced elder law attorney in Ohio to ensure that the compensation will count toward the spending down of their assets.
- Include a detailed list of the caregiver’s responsibilities including transportation, laundry, cleaning, etc.
- Make sure the compensation is in line with what professional caregivers charge.
- The caregiver must report the compensation as income earned on their taxes.
If you are caring for a parent – especially if that parent is likely to need long-term nursing home care – call us right away at 1-877-653-3450 for a free consultation.