WHAT IT IS:
An agreement between caregiver and the caregivee that states that the caregiver will provide care to the caregivee in exchange for specified compensation. The agreement would set forth the specific responsibilities of the caregiver, including days and hours of care and the compensation paid for that care.
PROVIDE FOR YOUR CAREGIVER: Provide compensation to a trusted loved one who may have had to quit a job, forgo job opportunities or otherwise spend considerable time and energy providing care.
AVOID FAMILY CONFLICT: Minimize problems among relatives as to who will provide necessary care and how it will be paid for.
SAVE MONEY: Long term care insurance may provide for such care if there is a formal, reasonable agreement.
TRANSFER MONEY & ASSETS TO A CAREGIVING LOVED ONE AND NOT THE GOVERNMENT- HAVE MEDICAID PAY FOR YOUR FUTURE LONG-TERM CARE NEEDS:
Should an alternate caregiver or nursing home become necessary, all assets of the caregivee will be considered available to pay for that care and Medicaid will not be available until all assets are depleted.
Certainly the care a loved one provides is just as valuable and worthy of compensation as the care provided by a future caretaker or nursing home.
With a personal care agreement the caregivee can provide for his or her caregiving loved one and have Medicaid pay for future long term care costs. The trick is drafting the agreement properly so that it won’t be considered an improper transfer and lead to a penalty period by Medicaid. It is best to consult an attorney knowledgable in Medicaid laws to assist you in the drafting.