Medicaid and veterans programs can help alleviate the financial
burden of family caregiving
AARP, Updated October 15, 2019
En español | Caregiving for a family
member can be time-consuming and emotionally draining.
It can be financially draining, too. About 43.5
million Americans provide care without pay to an ailing or aging loved one, and
about 1 in 4 do so for more than 41 hours a week, according to a study from
AARP and the National Alliance for Caregiving.
Family caregivers’ unpaid commitment to this
work can make it hard to make ends meet, fueling a growing national
conversation around issues like paid leave and even outright payment for
caregivers. A variety of programs can alleviate some of the financial burden of caregiving and make life a
little easier.
Your chances are best if you are caring for a
U.S. military veteran or for someone eligible for Medicaid, but other
possibilities exist.
For Medicaid
recipients
All 50 states and the District of Columbia
offer self-directed Medicaid services for
long-term care.
These programs let states grant waivers that
allow qualified individuals to manage their own long-term home-care services,
as an alternative to the traditional model where services are managed by an
agency. In some states, that can include hiring a family member to provide
care.
Benefits, coverage, eligibility and rules
differ from state to state.
Some programs pay family caregivers but
exclude spouses and legal guardians. Others will pay care providers only if
they do not live in the same house as the care recipient.
Program names also vary. What is called
Consumer Directed Care in one state might be called Participant-Directed
Services, In-Home Supportive Services or Cash and Counseling in another. Contact your state Medicaid program
to ask about its options or to start the sign-up process.
Enrolling in self-directed care involves the
following steps:
• Assessment. Your loved one — with assistance if desired
or needed — is assessed for capacities, need, preferences, risks and strength
as the Centers for Medicare & Medicaid Services requires.
• Planning. Your family member and any chosen
representatives create a written service plan detailing the daily living
assistance required.
Areas may include bathing, dressing, feeding,
helping with light housekeeping and laundry, managing medications, moving from
bed to wheelchair, preparing meals, shopping, supervising activities and
transporting to appointments. Contingency plans should be available for
coverage when the care provider is off and instructions for fill-in
caregivers should address risks.
• Budgeting. If the assessment shows
need, a budget for goods and services will be provided.
• Selection.
When the care plan is set, the care recipient, or a surrogate if needed,
chooses a caregiver.
For military
veterans
Veterans have four plans that they may qualify
for.
Like Medicaid's self-directed care program,
this plan allows qualified former service members to manage their own long-term
services and supports. It is available in 37 states, the District of Columbia
and Puerto Rico for veterans of all ages who are enrolled in the Veterans
Health Administration health care system and need the level of care a nursing
facility provides but want to live at home or the home of a loved one.
A flexible budget — the average is about
$2,200 a month — enables veterans to choose the goods and services they
find most useful, including a caregiver to assist with activities of daily
living, such as bathing, cooking, feeding, dressing, using the bathroom and
adjusting prosthetic devices. The veteran chooses the caregiver and may pick
any physically and mentally capable family member including a child,
grandchild, sibling or spouse.
VA medical centers determine eligibility and
make referrals. Find and contact your nearest center for more information on the
program.
This program supplements a military pension to
help cover the cost of a caregiver, who may be a family member. A&A
benefits are available to veterans who qualify for VA pensions and meet at least one
of the following criteria. The vet:
·
Requires help from
another person to perform everyday personal functions such as bathing, dressing
and eating.
·
Is confined to bed
because of disability.
·
Is in a nursing home
because of physical or mental incapacity.
·
Has very limited
eyesight, less than 5/200 acuity in both eyes, even with corrective lenses, or
a significantly contracted visual field.
Surviving spouses of qualifying veterans also
may be eligible for this benefit.
To apply, complete the A&A application form. Explain why a
caregiver is needed, ideally including an attending doctor's report.
Be specific about the disease or injury that
caused physical or mental impairment, and explain on the form your typical day,
noting how well you get around, any loss of coordination or any inability to
manage basic daily needs without assistance. You can mail the form to the pension management center that serves your
state or file in person at your regional VA benefits office.
Veterans who receive a military pension and
are substantially confined to their immediate premises because of permanent
disability can apply for a monthly pension supplement.
The application process is the same as for
A&A benefits, but you cannot receive both housebound and A&A benefits
at the same time.
This program provides a monthly stipend to
family members who serve as caregivers for veterans who need assistance with
everyday activities because of a traumatic injury sustained in the line of duty
on or after Sept. 11, 2001.
The care recipient must be enrolled in VA
health services and require either personal care related to everyday activities
or supervision or protection because of conditions sustained after 9/11. The
caretaker must be 18 or older and a child, parent, spouse, stepfamily member,
extended family member or full-time housemate of the veteran.
The stipends are pegged to wage rates for
professional home health aides and vary based on the amount
of time the family member spends on caregiving per week.
In 2017 yearly pay for caregivers under the
program ranged from $7,800 to $30,000, according to the Congressional Budget
Office. The stipend is not considered taxable income.
Other caregiver benefits through the program
include these:
• Access to health insurance and mental health services, including
counseling
• Comprehensive
training
• Lodging and travel
expenses incurred when
accompanying vets going through care
• Up to 30 days of respite care per year.
The military caregivers benefit is slated to
be expanded to veterans of all eras under the VA Maintaining Internal Systems
and Strengthening Integrated Outside Networks (MISSION) Act, signed into law in
June 2018. The change was expected to be implemented in 2019, but the VA missed
its first deadline to update information technology infrastructure to support
the expansion.
In May 2019, the agency told Congress that it
is still encountering issues and has not set a new date for expansion.
For more information on help for military
caregivers, visit the VA Caregiver Support page
or call its hotline at 855-260-3274.
Getting paid by
a family member
If the person needing assistance is mentally
sound and has sufficient financial resources, that person
can choose to compensate a family member for the same services a professional
home health care worker would provide.
If you and your loved one are exploring this
route, try these steps to establish a proactive employer-employee approach,
which can minimize stress and family tension.
• Put aside any awkward feelings about discussing what you both need. Talk
about wages and paydays, health risks, scheduling, and how respite care and
caregiver sick days will be handled.
• Draw up a personal care agreement that will serve as
a contract between the caregiver and the care recipient.
It should spell out wages, what services will
be provided and when, and the length of the agreement, among other terms.
Consider involving other members of the immediate family in working out terms
so they are not surprised later.
• Consult an elder care lawyer to review your contract to make sure it meets
tax requirements and deals with inheritances. All other interested parties,
such as siblings, need to approve it.
• Beware of emotional
pitfalls. If family members
seem uncomfortable with the arrangement or disagree with the plan, consider a
session with a neutral party, such as a family therapist or family mediator who specializes in elder care.
• Keep professional
records. Specify services
performed, dates of work and the amount paid.
This paperwork is essential if your family
member later applies for Medicaid. During the qualification process, a
caseworker will examine records for the past five years.
• Report income. As with any paid job, caregivers are legally
required to report wages as taxable income. If at a later date, your family
member becomes eligible for Medicaid but your taxes have not been paid,
Medicaid will consider the money a gift — not an expense.
This could prevent your loved one from
qualifying for Medicaid. On the other hand, the Internal Revenue Service is
clear: When services are provided, all money received is a wage, not a gift.
Long-term care
insurance
If your loved one has long-term care insurance, it probably covers
some costs for home health care and personal care services.
However, not all policies extend that coverage
to paying spouses or other family members living in the home. Ask your loved
one's insurance agent or insurance company for specifics and request a written
confirmation of benefits.
Editor's note: This article was originally
published in October 2016. It has been updated with more recent information.
Learn More
about Caregiving Finances
- What caregiving costs will Medicare cover?
- Prepare a digital estate plan for future caregivers
- Surprising out-of-pocket costs for caregivers
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