Does My Family Need A Caregiver Contract?

October 31, 2011 § Leave a comment

For many, the only option to receive regular in-home care is to rely on a family member to provide the needed services. Whether the reason is financial or personal preference, it is essential to have a contract between all parties involved if there are any type of wages paid to the caregiver.

The basic caregiver contract should be signed and dated by the parties involved and describe the services that are to be provided as well as the wage that will be paid to the caregiver. A well written contract will help eliminate confusion about what is expected from the caregiver and the care recipient. The contract is especially important and needs to be carefully prepared if the person being cared for ever needs to qualify for Medicaid coverage.

Important aspects to consider in order for a contract to be Medicaid eligible are:

  • Fairmarket Reimbursement Rates – Some states have a maximum wage that can be paid to a caregiver
  • Proper Documentation – After the wage is agreed upon, carefully document all payroll checks and payroll taxes
  • No Pre-Payments – Wages can only be paid after services are rendered. No money can be paid for future services
  • Prescribed Services – Some states require that caregiver services be prescribed by a physician
  • Maximum Payments – The total amount allowed for services rendered can also vary state to state
  • Think Ahead – The agreement cannot be a last minute deal among family members

Attorney John L Roberts, in his article titled “Caregiver Contracts that Protect Elders and Their Family Members” states:

“A written Caregiver Contract is a good idea for every family that wants to protect family harmony, and make sure everyone in the family understands how care is being provided to an elder.

The family member who provides care can save an elder from needing nursing home services, and may also protect assets if nursing home care is needed in the future. Elders who want to cover all of these bases must have a written Caregiver Contract. Whenever adult children and other family members are providing valuable care, only a written agreement will protect assets from nursing home care costs and qualify the elder for Medicaid.”

In many cases, it may be necessary to consult an elder law attorney to help navigate preparing a contract that follows all of your state’s regulations while also considering Medicaid rules for eligibility. A well prepared contract can help protect your family member’s assests especially if they wind up requiring nursing home care in the future.

If you have any questions about creating a caregiver contract for a family member, please contact the Law Office of Dawn M. Weekly, PC. The law firm located in Sandwich, Illinois and focuses on elder law and Life Care Planning for clients. Their office may be reached by calling 815-570-2334.

Every day of every week, Weekly Law is here for you.


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