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Elder Law and Estate Planning Blog - Lancaster, PA

Monday, July 1, 2013

Costly Caregiving

Many times, the cost of providing a full time skilled caregiver (which is estimated at $5,531 out of pocket expenses) causes a family member (or members) to step in a serve as a caregiver.  But even this can cause financial issues, as the caregiver will lose his or her paycheck once pulled away from his regular job.  He or she might fall behind of retirement savings, also, and there could be some difficulty returning to the workforce.

Fortunately, there are some options available for compensation for caregivers.  Pennsylvania has a Caregiver Support Program that includes supportive services such as counseling, education, financial information, and monthly reimbursements depending on your needs if you care for a person over 60 with chronic dementia.  If your loved one is a veteran, you can receive a monthly stipend if the veteran was injured in a military conflict after 9/11.  Other benefits include access to health care insurance, mental health services and respite care of 30 days a year.  For veterans of other wars, caregivers may be eligible for the VA's Aid and Attendance Pension Benefit.  If your family member has long-term care insurance, it may cover some home care.  Some policies permit family members to be paid, but you should ask your family member's insurance information to explain this benefit and its conditions.

If none of these other options apply to you, you can still be paid if your family member has some savings or assets.  In a method that is becoming more popular as more children are caring for aging parents, a caregiver contract writes out the services that will be provided as well as the pay he or she will provide.  A simple, written personal care agreement can help every party involved understand what is supposed to be done and when.  It can also help avoid misunderstandings with other family members and can prove the validity of the pay and the services for the state and Medicaid if you family member ever needs to enter a nursing home.

A caregiver agreement should include when the care will begin, the tasks that will be performed (be specific and thorough, but also provide yourself with some flexibility by including a statement like "or similar tasks to be mutually agreed upon by the parties), how often you will provide the care, how much you will be paid (and when), and how long the agreement will stay in effect (again, you can provide yourself with some flexibility by saying "This agreement shall remain in force until terminated in writing by either party").  You should also include a statement that allows for the contract to be changed only by mutual agreement in writing by both parties.  Once everything is written, both you and your loved one should sign and date two contracts, one for each of you.

For an example of a contract that was upheld in Missouri during a Medicaid dispute, see this example provided by Survivorship A to Z.  However, just because it was upheld in Missouri does not mean it will be in Pennsylvania, and you should seek an elder law attorney to verify that it meets all tax requirements.

If a personal care agreement is not a viable option, and you are still facing financial hardship, consider seeing if your family member is eligible for programs that send an outside caregiver to the home so the responsibility isn't solely yours.  Also, look into finding a job that allows you the flexibility needed as a caregiver, or try working from home.  You can also hold a family meeting with siblings to discuss ways you can all share the financial burden, or even discuss receiving a larger portion of inheritance to help cover the finances of caregiving.  Whatever you do, make sure your loved one, family members, and yourself are all in agreement.

Caregiver Program Links:
Pennsylvania Caregiver Support Program
VA Caregiver Support Services

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