Family Caregivers and Medicaid Eligibility
As family members age, it is not uncommon for them to experience physical and/or mental issues that require the services of a caregiver to keep them healthy and safe. Going to a nursing home is an option in this situation, but this may not be the desired scenario at this stage. Family members frequently step in at this point to provide the needed care, with the thought that nursing home care may be required at some point. Paying for the costs of a nursing home is out of reach for most individuals, and they need the benefits provided through Medicaid to cover this expense. However, Medicaid benefits are awarded to individuals according to financial need, so income and asset restrictions are imposed on recipients. From the outside, it may not seem that a family member acting as a caregiver would impact eligibility, but it most definitely can if not properly structured.
How the Government Views Family Caregivers
Most family caregivers provide these services out of love and do not expect to be paid for their efforts. However, this attention is usually a prelude to entering a nursing home for the ill or incapacitated relative, and thoughts do need to be directed on how to pay for this transition. Because Medicaid is need-based, many people will not automatically meet the requirements, despite no reasonable way to pay the exorbitant costs of nursing home care (currently, $9,100 per month on average), and will need to find a way to shed assets to qualify for benefits. One relatively easy way to transfer assets to family members without being penalized is by paying those who perform caretaking duties. However, it is crucial that the payment is not made for services performed in the past, but instead is arranged so that money is given on an ongoing, prospective manner. If a family pays someone for past services, Medicaid will look at this transfer as a gift, and include it as part of the five-year look-back period, which will most likely result in penalties being assessed and benefits denied for a certain period of time.
Qualifying for Medicaid benefits in anticipation of entering a nursing home is a big concern for many seniors, and one way to facilitate that goal is to contract with one or more family members, through a personal services contract or caregiver agreement, for the payment of money related to any caretaking services they provide. This allows the child or other relative to receive part of the estate they likely would have inherited anyway, and reduce assets in the estate that exceed Medicaid limits. There are a number of restrictions that govern how these agreements must be structured, and the person receiving the money will need to report it as income, but this option can provide one avenue, among many, a person can use to qualify for Medicaid benefits. Given the strict parameters these contracts must meet to not violate Medicaid regulations, it is crucial that an elder law attorney with Medicaid experience draft the necessary documents.
Contact a Florida Medicaid Attorney
Qualifying for Medicaid is much more complicated than many people realize, and planning needs to start well before benefits are needed. Clearwater Medicaid attorney William Rambaum has more than three decades of experience helping Florida’s seniors get the government assistance they need for nursing home care and is ready to take your call to discuss your situation. Contact the office today to schedule an appointment.