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801 West Bay Drive, Suite 518
Largo, FL 33770
Phone: 727-683-1483
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Why Are Family Caregiver Contracts Under Attack?

As our parents and other loved ones age, it can be difficult for them to remain in their homes and care for themselves.  That’s why many seniors end up in nursing homes. Unfortunately, these facilities are often extremely expensive, and the elder-care industry is considered a last resort for many families. To avoid wasting huge sums of money, some people decide to care for their loved ones at home.

This type of dedication often requires the caregiver to give up their employment or to work part-time instead of full-time. To deal with this loss of income, many families create “personal services contracts” that pay the adult caregiver as if they were an employee. These contracts offer an option that is more compassionate than a nursing home while also serving to keep funds in the family.

Such contracts, however, have been attacked by legislators and others because they offer a way for a parent to transfer money to their relatives outside of the normal inheritance or gift-giving processes. Because a service is being paid for, the money is not considered a gift or legacy. While it is true that some people take advantage of personal services contracts to transfer large amounts of money, most people use them out of necessity. There is no reason that an adult child should be prevented from being compensated for providing home-care services for an elderly parent, especially when they give up their career to do so.

Family caregiver contracts also serve as a way to qualify for extended Medicaid coverage. Because Medicaid requires the recipient to have only a small amount of money left before they can qualify for long-term nursing home coverage, some families use these contracts to make a reasonable up-front payment for care. This allows the family to keep some of their loved one’s assets while also making their loved one eligible for government support. Many families put this money aside in case the parent needs it later.

It’s difficult enough to watch our parents grow old; that stress is compounded by worries about how we can afford to care for them. For help understanding caregiver contracts and Medicaid eligibility, contact a skilled Florida Medicaid attorney at the Charles Law Offices today.

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