It isn’t uncommon to be unable to pay for needed home care but to have too much money to qualify for assistance. One solution may be to pay a family member.
As we age the need for a caregiver at home becomes necessary for many. For people on fixed income they often find them in the situation of not qualifying for Medicaid to pay for home care help because they have too many assets but also not being able to afford it out of their own pockets. One possible solution is to pay a family member.
Family members do most of the work for people who are cared for at home, even if there is also paid home care help. If you find yourself needing paid help and would like to qualify for Medicaid but have slightly too much income or assets to qualify, paying one of your family members who regularly takes care of you might accomplish two useful things at once. First, the family member gets paid for something he or she otherwise would do for completely free. And the amount you pay that family caregiver might drop you below the income or asset qualifying levels for Medicaid coverage of home care, meaning that you could get Medicaid to pay for additional home care help.
To make sure that paying a family member is considered completely legitimate by Medicaid, you have to carefully follow several steps:
Call around to local home care agencies in your area to find out how much their aides are paid for the same exact kind of work your family member performs for you.
Draw up a written agreement between you and your family member caregiver. This may be something that you want to get a lawyer’s assistance with. This written agreement will specify the work your family member is to do, how often, and how much you will pay them for these services (that is in line with what local care agencies pay their home care professionals).
Always pay the family member by check, keeping an ongoing record of how much time your family member works and how much you pay them for their services. Take the money out of your assets (savings accounts, mutual funds, etc...) if it is the amount those assets that are too high for you to qualify for Medicaid.
Paying someone for elder care supportcare for you may also have some tax consequences. The family member that is getting paid to take care of you must report this income on their tax returns. And as the household employer, you may have to report to the state and federal government the amount you pay, A bookkeeper or accountant can tell you if you need to do this and if so can help you set up the paperwork normally for a fairly low one-time fee.
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