In recognition of the important role family caregivers play in helping seniors maintain their health and well-being at home, there are an increasing number of options to help pay a family member who provides care for an aging loved one. Explore the programs available for seniors and their caregivers as well as additional options to receive financial assistance while caring for a parent at home.
According to a report conducted by the AARP Public Policy Institute, approximately 41 million family caregivers provided 34 billion hours of unpaid care in 2019. Caregivers’ unpaid contributions had a staggering estimated economic value of $470 billion. Unfortunately, this care is commonly provided at a huge personal cost to caregivers, including lost wages and benefits. Many spend thousands of dollars out of pocket each year on their care recipients, often to the detriment of their own financial security and retirement savings.
“Can I Get Paid for Caring for My Parents?”
It should come as no surprise then, that the number one question asked in the Caregiver Forum is, “Can I get paid for caring for my parents?” Unfortunately, the answer is complicated. The vast majority of family caregivers do not get paid to care for an elderly loved one. However, there are a few options available that may allow a family member to receive payment in exchange for the care they provide.
Personal Care Agreements
Not all care recipients will be amenable to this arrangement, but it is possible for aging parents to use their own funds to pay a family member (usually an adult child) for the care they provide. It is important to work with an elder law attorney to complete a formal personal care agreement or caregiving contract detailing this arrangement before it begins. The personal care agreement should outline the services to be provided as well as the payment to be received. A major benefit of completing a formal care agreement is that paying for in-home care services is a valid means of spending down assets or income to reach Medicaid eligibility requirements. Keep in mind, though, that a personal care agreement cannot be created for retroactive payment for past care.
To learn more about how personal care agreements work and how to draft one, read Personal Care Agreements: A Must for Caregiver Compensation and Medicaid Planning.
Programs That Help Seniors Pay for Family Caregivers
Public programs and assistance vary widely by state and individual circumstances. The resources listed below may help family caregivers receive compensation for their services or at least find some programs and assistance that can help offset the costs of providing care for an ill or aging loved one.
Veterans who are signed up for VA health care have a number of options to manage a disability or health condition from home. The VA provides home-based primary care, homemaker/home health aide (HHA) services, and respite care for family caregivers depending on a Veteran’s personal eligibility and program availability in the geographic area. All veterans are eligible for services at home and in the community, however there must be a demonstrated clinical need in order to qualify for these services.
- Level 1: Basic pension for those with the lowest income and assets.
- Level 2: Housebound pension for disabled individuals with low income and limited assets who cannot leave their home without great difficulty or at all.
- Level 3: Aid and Attendance (A&A) pension for those with low income and limited assets who require the help of another person to perform activities of daily living (ADLs).
Housebound and A&A pensions are known as “improved” pension benefits; they are added to the amount of monthly pension a veteran is eligible for and meant to offset the cost of increased care that eligible veterans require. Tax-free pension amounts are based on each veteran’s income and asset levels. The cost of personal care services can help a veteran meet those income eligibility requirements, because income levels are calculated after the deduction of care expenses. Therefore, invoices submitted for paying a family member or home care agency for personal care services can be used to reduce income levels, and the resulting increased pension amount can be used to pay for continued personal care services. Surviving spouses of eligible veterans may also qualify for this monetary benefit.
Veteran-Directed Home & Community Based Services
VA Medical Centers that participate in VD-HCBS contract with home health agencies to aid with personal care and help with activities of daily living as an alternative to nursing home placement. Any veteran who is enrolled in the VA health care system and requires nursing home level care is able to select from whom they receive care, including family members. If nursing home level care is required, a housebound veteran can choose to hire an adult child or home care agency to provide personal care.
Program of Comprehensive Assistance for Family Caregivers
In recognition of the importance of family caregivers in maintaining the health and well-being of veterans, a veteran and their primary caregiver may apply to receive a number of benefits through the PCAFC. If a veteran is eligible, any family member over the age of 18 may receive:
- Caregiver education and training
- Mental health counseling
- Financial assistance with costs of traveling to a VA Medical Center
- 30 days of respite care
- Access to health care through the Civilian Health and Medical Program (CHAMPVA)
- A monthly stipend
Individuals with low income and few assets other than their home may be eligible for health care coverage through Medicaid. This includes hospital care, doctor’s visits, home health care, personal care services and long-term care. Medicaid recipients must meet many eligibility guidelines, including functional and financial requirements.
Medicaid is funded jointly by states and the federal government, therefore states vary in the services they provide as well as the names of the programs that provide them. The good news is that, in an effort to help seniors delay or avoid nursing home placement, all states now offer at least one program that pays for in-home care. In some states, if a senior is eligible to receive Medicaid in-home care services, family members may be paid to provide them. Many states prohibit spouses from receiving pay. However, in states that allow self-directed care, Medicaid recipients may identify their adult children and/or ex-spouses to be paid as their care provider.
Medicaid HCBS Waivers
States can offer services under waiver programs in addition to their state plan. Seniors who would otherwise be in a nursing home or hospital in order to receive long-term care may be eligible for a Home and Community-Based Services Waiver (HCBS) in order to receive support and assistance at home. Also called 1915(c) waivers, states use this method to pay for the care seniors receive that allows them to remain safely and comfortably within their long-time community.
Waiver programs work differently in each state and many have waiting lists for enrollment. Each state names its own waiver program, most of which are associated with their Cash and Counseling Programs.
Medicaid Cash and Counseling Programs
One particular program called “Cash and Counseling” provides Medicaid recipients with a set amount of money each month and the discretion to use these funds to pay approved care providers of their choice. This cash benefit can be used to pay for professional in-home caregivers, family members or even friends to provide care. Cash and Counseling is often referred to as consumer-directed care, in-home supportive services and several other state-specific names.
To learn more about Medicaid eligibility, HCBS Waivers and the Cash and Counseling Program, contact your state’s Medicaid office or visit Medicaid.gov.
Other Financial Assistance for Seniors and Caregivers
If none of the above options is a good fit for you and your elderly loved one, it may help to search for other financial benefits and services. Even a single program that can minimize the financial strain on your household can be worthwhile.
Supplemental Security Income (SSI)
The Social Security Administration’s Supplemental Security Income (SSI) program pays benefits to low-income aged, blind and disabled adults. Unlike Social Security retirement benefits, SSI benefits are not based on a person’s prior work. In addition to increasing a person’s income, applying for and receiving SSI is useful because the eligibility guidelines are also the basis for many other programs, such as Medicaid, food stamps, etc.
To learn more about SSI and apply for benefits, visit the Social Security Administration website.
Benefits Check Up
BenefitsCheckUp is the nation’s most comprehensive database of benefits programs for seniors with limited income and resources. BenefitsCheckUp is a free service of the National Council on Aging. This online tool allows elders to see if they qualify for more than 2,500 federal, state and private benefit programs simply by answering a few questions.
Available resources include:
- Prescription drug savings
- Nutrition assistance (including Supplemental Nutrition Assistance/Food Stamps)
- Energy/utilities assistance
- Income assistance
- Legal aid services
- Housing services
- In-home services
- Transportation services
Area Agencies on Aging
An Area Agency on Aging (AAA) is a public or private nonprofit agency designated by each state to address the needs and concerns of all older persons at the regional and local levels. All Area Agencies on Aging receive federal funding under the Older Americans Act and most receive supplemental funding from state and local revenues.
Area Agencies on Aging (AAA) are identified to represent a geographic region, county or city and are staffed by elder care professionals who are knowledgeable about every assistance program and service that is available in a particular area.
Gather as much information as you can about you and your care recipient’s health and finances and make an appointment to meet with a counselor at your AAA. The staff there can advise you on prospective programs and eligibility requirements and even help prepare the necessary applications and documentation. Visit the Area Agency on Aging Directory to find your local AAA’s contact information and schedule an appointment.
Elder Law Strategies Help Families Pay for Senior Care
Elder law attorneys help seniors engage in estate planning and prepare legally and financially for their long-term care needs. For example, an attorney who specializes in elder law may assist a senior in applying for VA benefits, achieving and maintaining eligibility for Medicaid, filing applications, and much more.
When looking for an attorney to help you and your loved one draw up legal documents and apply for benefits, make sure the lawyer you choose has elder law experience specific to the state where your loved one resides. In addition, attorneys can pursue membership in specialized national consortiums. Look for a professional who belongs to the National Academy of Elder Law Attorneys (NAELA) or has received the Certified Elder Law Attorney (CELA) designation.
To find an elder law attorney near you, search the AgingCare Elder Law Attorney Directory.
Sources: Valuing the Invaluable 2019 Update: Charting a Path Forward (https://www.aarp.org/ppi/info-2015/valuing-the-invaluable-2015-update.html)