Care Agreements and Medicaid Eligibility
Previously, I shared how to determine what duties you might continue to perform and which ones you should give to a paid caregiver. Once you decide, it’s important to verbally discuss the expectations with the caregiver and follow that conversation up with a summary of what you said. Make the summary very detailed. You will be surprised the amount forgotten, misunderstood, or deliberately dismissed when you mention things you thought you were clear about previously. The following information further details why having such an agreement is to your benefit.
Medicaid’s Asset Limits
Medicaid has an asset limit of $2000 that applicants must meet to qualify for benefits. Since $2000 is a low number, most individuals do not qualify for benefits initially. However, most seniors have retirement plans, property, personal valuables, or other valuables they have collected over the years that total more than $2,000.
Need to Reduce Assets to Meet Medicaid Eligibility
To achieve eligibility, they need to reduce or eliminate their possessions (assets). As they eliminate assets, the process must follow guidelines acceptable to Medicaid. For example, it is unacceptable to sell off possessions for less than their value or give items away as gifts to relatives. Another unacceptable method to reduce funds is to transfer money from one account to another by paying a family member bogus services.
Medicaid Looks-Back Over Five Years
When someone applies for Medicaid, part of the application process is a “look back” over the past five years to see how they spent their money. Medicaid checks bank records to determine if it appears that past assets were gifted or inappropriately sold at less than value. If Medicaid determines that an applicant has violated the “look back” rule, a penalty of Medicaid ineligibility results.
Patient Care Agreement Validates Use of Payments
If you are paying someone regularly to care for your family member, you run the risk of jeopardizing your ability to obtain Medicaid assistance. Medicaid may consider these payments as gifts, hence, in violation of the look-back rule. On the other hand, a personal care agreement legitimizes payments made to the individual. It provided proof of payment for services requested in advance and performed as agreed. With a verbal agreement, there is no proof.
Record Daily Work Hours
In addition to the written Care Agreement, caregivers should keep a daily log detailing the services provided, the hours worked, and payments received. The Care Agreement further proves the relationship between the Medicaid applicant (care recipient) and the caregiver, should Medicaid need it.