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Can I get paid for caretaker services already provided to my mother?

Can I get paid for caretaker services already provided to my mother?
Medicaid Planning
Jason Neufeld
February 17, 2019

When mom (or dad) gets sick, their adult children are often the ones who pick up the care-provider mantle—assisting their parent with routine household chores, cooking meals, and even more basic caretaking necessities, such as assisting mom with going to the bathroom, bathing, and eating.

At some point, it becomes clear that mom is getting worse and professional help is necessary. Eventually, moving mom into a nursing home may be the best (or only) option. If they have not yet consulted with an elder law attorney, the cost of the nursing facility hits the family like a ton of bricks:

In Florida, the average cost of a nursing home, as of 2024, is around $10,500 per month! The family realizes that Medicare does not pay a dime towards nursing home care after 100 days, and someone tells them that they ought to look into applying for Medicaid.  

Anyone who does basic Medicaid research will quickly learn that Medicaid penalizes applicants for gifting money to someone during the five-year look-back period.

But the mother and child may discover, after speaking with an experienced elder care lawyer, that the child can get paid for helping care for their mother. This is a great solution, and if structured properly, it’s one of many Medicaid planning strategies utilized by elder law attorneys to properly get some assets out of mom’s name.

Initially, this is exciting because “I’ve been taking care of mom for a few years now…I should just get paid for all that caregiving and caretaker work!”

Unfortunately, Medicaid just doesn’t allow it. Care providers of Medicaid applicants can’t get paid for the services they already provided to their mother or father because Medicaid only allows these arrangements if they are made prospectively (not retroactively). If made beforehand, the money transfer is deemed a gift and Medicaid penalizes the applicant.

But no law requires a child to provide personal care services for free (although we often do out of love).

Thankfully, there are some solutions. Continue reading to learn how you can get paid to take care of your mother.

Personal Services Contract | Caregiver Agreement

If you draft it correctly, a personal services contract or a caregiver agreement can be an incredibly effective tool to help the parent qualify for Medicaid while remaining in line with their estate plan (i.e. getting money to people who will inherit it anyway). A personal caregiver agreement can involve multiple people (within reason) as well.

When mom, dad, and the caretaker child meet with their elder care attorney to discuss Medicaid planning, the elder law attorney can draw up personal services contract that Medicaid will accept. 

You should never attempt to draft a personal services contract on your own because any mistakes you make can cost your parent valuable benefits. Furthermore, there are income-tax issues with caregiver contracts.

Personal services contracts are just one of many Florida Medicaid planning strategies that can be used to help qualify your mom or dad for Medicaid while protecting their hard-earned assets. Call our elder law attorneys to discuss your family's Medicaid planning options.

Getting Paid as a Family Caregiver Through Medicaid

Caring for an ill family member is difficult work, but it doesn’t have to be unpaid work. There are programs available that allow Medicaid recipients to hire family members as caregivers - this is an alternative to family caregiver agreements or personal services contracts.

All 50 states have programs that pay family caregivers. The programs vary by state but are generally available to Medicaid recipients, although there are also some non-Medicaid-related programs.

Participant Directed Option

Medicaid's program is usually called "self-directed," "consumer-directed," or "participant-directed" care. In Florida, the Medicaid Waiver allows participants to activate the Participant Directed Option or "PDO option." The first step is to apply for Medicaid through a home and community-based Medicaid program

Medicaid is available only to low-income seniors, and each state has different eligibility requirements. Florida Medicaid application approval can take months, and there may also be a waiting list to receive benefits under the program.

The state Medicaid agency usually conducts an assessment to determine the recipient's care needs—e.g., how much help the Medicaid recipient needs with everyday activities, such as bathing, dressing, eating, and moving. Once the assessment is complete, the state draws up a budget, and the recipient can use the allotted funds to pay for goods or services related to care, including paying a caregiver.

In the Participant Directed Option (PDO), Florida Medicaid recipients can choose to pay a spouse, child, grandchild, or other family member or friend as a caregiver, but other states vary on which family members are allowed. For example, most states (not including Florida) prevent caregivers from hiring a spouse, and some states do not allow recipients to hire a caregiver who lives with them. 

Most programs allow ex-spouses, in-laws, children, and grandchildren to serve as paid caregivers, but states typically require that family caregivers be paid less than the market rate in order to prevent fraud. Florida is similar in this last regard in that PDO caregivers are usually paid between $15.00 - $16.00 an hour for unskilled caregiving (as of 2024).

In addition to Medicaid programs, some states have non-Medicaid programs that also allow for self-directed care. These programs may have different eligibility requirements than Medicaid and are different in each state. Family caregivers can also be paid using a "caregiver contract.”

Veteran-Directed Care Program

In some states, veterans who need long-term care also have the option to pay family caregivers. In 37 states, veterans who receive the standard medical benefits package from the Veterans Administration and require nursing home-level care may apply for Veteran-Directed Care. The program provides veterans with a flexible budget for at-home services that can be managed by the veteran or the family caregiver. 

Also, if a veteran or surviving spouse of a veteran qualifies for Aid & Attendance benefits, they can receive a supplement to their pension to help pay for a caregiver, who can be a family member.

Adult Child Caregiver Exception

It’s important to note that there is an adult caregiver exception. This benefit allows the transfer of a home to a caregiving child if that child provides caregiving services to their elder parent for two years or more (and that caregiving delays the entrance to a nursing home for at least that long). This is a nice way for my Medicaid-planning clients to leave a legacy for their child without triggering the five-year look-back gift penalty rule.

Contact a Reliable Elder Law Attorney Today

If you’re looking after your sick or injured parents, you understand the difficulties of being a caregiver. It’s hard work that you should be paid for. Thankfully, there are some ways you can receive financial assistance for this work, such as a PDO or a personal services contract.

Knowing what’s best for both you and your mom or dad can be hard. If you need help planning for the future and ensuring the best care for your parent, you may want to consult with an elder law attorney.

Contact Elder Needs Law today to schedule a consultation.

Elder Law Resources

Jason Neufeld

Jason Neufeld is the Founder and Managing Partner of Elder Needs Law, a Florida estate planning and elder law firm he created in 2017. With more than 15 years of experience practicing law, he represents clients in a wide range of legal matters, including Medicaid planning, estate planning, elder law, probate, Medicare, and life insurance.

Jason received his Juris Doctor from the University of Miami — School of Law and is a member of the Florida Bar and the Broward County Bar Association. He has received numerous accolades for his work, including being named a Rising Star and Super Lawyer by Super Lawyers and among the Florida Legal Elite by Florida Trend in 2024.

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