Elder Law and Life Care: Planning, Strategies & Solutions

How to Pay Family Caregiver

2008-04-30T07:59:00.003-05:00

Getting the Government to Pay Family Caregivers

Some 44.4 million adult caregivers -- or 21% of the U.S. adult population -- provide unpaid care to seniors or adults with disabilities, according to a 2004 study by the National Alliance for Caregiving in Bethesda, Md. On average, those caregivers provide 21 hours of care a week and the average length of time spent providing care is 4.3 years.

Over the years we have received many public requests through our website. A number of these requests have been from family caregivers who had to cut back on their employment or even quit their jobs in order to take care of one or both of their parents. Invariably these caregivers assume there is a government program that will pay them to provide this care. Only recently have we become aware of some programs that will pay family members. These programs are not publicized and the public is largely unaware of them or how to receive them.

Money Follows the Person—MFP (Self-Direction in Care)In recent years, some state Medicaid programs have been experimenting with the idea of providing a budget to elderly Medicaid recipients. This money can be used to hire family or friends to provide care at home. Most of these programs are very limited, and there are waiting lists for them. Also, the amount of money available may not always be enough to compensate a family member to provide full-time care in lieu of maintaining employment.

But the attitude of government is quickly changing and there is now a new initiative to provide income for family caregivers. The Deficit Reduction Act of 2005 allocated $1.4 billion -- the largest demonstration grant in Medicaid history -- to a program called "Money Follows the Person." This program is designed to transition individuals receiving Medicaid and who are living in institutions, back into the community. In 2007, 31 states received their portion of the grant money pie to begin demonstration programs offering more choice in care besides an institution. Most of these state programs offer a concept called "self-direction" which allows a budget to be established by Medicaid for the care recipient. Self-direction allows the care recipient to spend this money hiring any caregiver of choice and this typically includes friends and family.

Unfortunately, this is not a widespread benefit for elderly Medicaid recipients and in addition only applies to bringing elderly people out of institutions and back into the community to receive care. Over the next five years, only 34,395 elderly care recipients nationwide are expected to be transitioned to community-based care through this program. Even though this represents a fraction of the elderly, who over the next five years are expected to receive Medicaid services in institutions, there is still a possibility for the family to apply for one of these programs and to have the government pay for their care services.

Using the Veterans Aid and Attendance Pension Benefit a totally overlooked source of money to pay family caregivers to provide care at home is the aid and Attendance Pension Benefit. This money is available to veterans who served during a period of war. Pension money is also available to the widows of these veterans. This benefit, under the right circumstances, can provide up to $1,843 a month in additional income to pay family members to provide care at home.

It also comes as a surprise to many people that about 33% of all seniors could qualify for the aid and attendance benefit. That's how many veterans or their surviving spouses there are in this country.

Getting the aid and attendance benefit to pay for family caregivers is not an easy task. This is because there must be a caregiver contract in place and services for care must be initiated and thoroughly documented before application can be made. Getting these applications approved requires using a consultant who understands the documentation requirements. Very few people can do it on their own.

Using Medicaid Spend down to Pay Family CaregiversIn order to qualify for Medicaid nursing care, a person must spend his or her cash assets down to less than $2,000. Instead of giving this money to the nursing home and waiting for Medicaid to kick in, the potential beneficiary can instead transfer this money to a child in return for caregiver services. This is not considered a gift and if done properly does not create a penalty for Medicaid eligibility. The strategy also allows Medicaid to take over paying its portion of the nursing home costs much sooner.
As with the caregiver contracts for VA benefits, an expert in this area of Medicaid benefits is required in order to do it right. In fact, the same type of caregiver agreements used for obtaining extra income under the veterans benefit can also be used for Medicaid. A consultant who is proficient in both the aid and attendance benefit and Medicaid personal caregiver agreements can be of great service to the community. This contracts’ consultant can help relieve a great deal of caregiver stress by providing funds to help that caregiver cope with personal financial pressures.

We are excited to help family caregivers lessen the financial stress of their caregiving commitment.

Members of the community who wish to know more about veterans benefits consultants and caregiver agreements can contact the Ricgard M. Barron by calling us at 800-939-9093 or go to our web sit at http://www.texaselderlawattorney.com/.

2008-03-18T14:03:00.002-05:00

Regulator Warns Consumers On Reverse Mortgages

Although a reverse mortgage can be helpful to homeowners having trouble paying their bills, it also can jeopardize the homeowners’’ financial future, warns the Financial Industry Regulatory Authority.

Financial Industry Regulatory Authority says the loans often are aggressively marketed as an easy, cost-free way for retirees to pay for lifestyles, or even for risky investments that can endanger their financial security.

The organization issued an alert urging homeowners to weigh their options carefully before proceeding with a reverse mortgage. If consumers do decide a reverse mortgage is right for them, they still need to be sure to make prudent use of the proceeds, advises Financial Industry Regulatory Authority in a new investor alert, "Reverse Mortgages: Avoiding a Reversal of Fortune."

The agency notes that reverse mortgages are expensive.
Interest rates for reverse mortgages tend to be higher than rates for home mortgages and other types of loans, while fees and costs of these loans are often significantly higher, too sometimes as high as 4% to 8% of the total loan amount.

The result is the borrower can wind up with less cash than expected, Financial Industry Regulatory Authority says.

Financial Industry Regulatory Authority also is telling potential reverse mortgage borrowers that they will still be responsible for property taxes, insurance and maintenance costs on their homes.

"If you are not able to meet these obligations, the lender may have the right to foreclose on your home, leaving you in the worst possible situation no place to live, and no more home equity to draw on," Financial Industry Regulatory Authority says.

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Choosing Beneficiaries

2008-02-14T15:32:00.002-06:00

Choosing Beneficiaries
You can name your spouse, children and grandchildren as beneficiaries to receive certain assets after your death, including individual retirement accounts (IRAs), life insurance policies, and annuities. Make those designations carefully, since they typically override any provisions in your will.
Consider the following points:
List all assets with beneficiaries, noting the owner, primary beneficiary, and contingent beneficiary. Also indicate the expected value of each asset.

Select the most appropriate person as beneficiary for each asset. In some cases, tax and estate planning considerations may help dictate whom to choose. For instance, spouses typically have more options when inheriting an IRA, so that may be the better choice for your IRA.

Name contingent beneficiaries. Without a named contingent beneficiary, the asset will be included in your probate estate if your primary beneficiary dies before you. Then, the asset may have to go through the probate process and may be distributed to a beneficiary you had not intended to receive that asset.

When naming more than one beneficiary, indicate what percentage of the asset each beneficiary should receive. Also decide whether each beneficiary's share should be distributed to that person's heirs or divided among the remaining beneficiaries if a beneficiary dies before you.

Assess whether your beneficiaries are capable of managing the asset. If not, you may want to set up a trust to control distribution of the asset.

Review your beneficiaries periodically to determine whether changes are necessary. A divorce, remarriage, spouse's death, or child's birth are all events that may require changes to beneficiaries. You should also review your beneficiary choices if you make changes to your will.

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