MEDI-CAL BASICS: YOU CAN BE A PAID CAREGIVER
June 22, 2021
At first it may seem shameful or detrimental to ask for your parents to pay you for the care you provide. However, take the following scenario as an example where this could be immensely helpful. However, please note that this must be done with a professional or there could be adverse consequences.
Sally Johnson feels worn out. Four years ago, her father died and for the past three years she has been caring for her aging mother.
At first, her mother only needed help with little things…grocery shopping, trips to the doctor, and help with her medication. Little things like that. But as her mom’s health deteriorated, Sally’s burden increased. In particular, the last six months have been brutal because Sally had to move her mother into a nursing home. Her mother just could not live at home anymore.
Sally thought her job would be easier once the nursing home staff took over, but it did not turn out that way.
As the oldest daughter, Sally still feels personally responsible for her mother’s wellbeing and happiness.
Even though the nursing home staff takes good care of her mother, Sally feels like she must be there, so she visits her mom six days a week.
Sally is running herself ragged and her mother is running out of money to cover the facility expenses. She only has about $50,000 left, and at $8,000 per month for the nursing home, Sally knows her mother’s money will not last long.
Sally keeps wondering what will happen when the money runs out. Who will pay the nursing home? What will happen if there is no money to pay? Where will her mother go?
Sure, Sally has heard of Medi-Cal. But will it cover the nursing home costs? She has heard it will not cover everything and worse still, she has heard that Medi-Cal will make her mom give up what remains of her money.
Is it worth it and could her mother really qualify? These are the worries that Sally has as she debates the best way to provide for her aging mother
ALL HOPE IS NOT LOST FOR SALLY AND HER MOTHER.
At our firm there are many ways to address this dilemma. One such example would be a personal care contract between Sally and her mother. Even though Sally’s mother is living in a facility, she still takes time almost daily to visit and check in on her mother.
Because of this large time commitment, a care contract could be considered. Sally and her mom could enter in a formal agreement wherein Sally becomes her mother’s designated care manager. This way, Sally can get paid for the care management services she handles for her mother...
PAID CAREGIVING AS A SOLUTION...
For example, if Sally spends approximately 1.5 hours per day caring for her mother, that’s nine hours per week (i.e. six days per week times 1.5 hours per visit). Potentially, Sally could be paid by her mother $10 an hour, or $90 per week, for her services.
In and of itself, that would not add up to too much. But, if you consider that Sally and her mother can enter a Lifetime Care Contract, it gets interesting. Sally’s mother could decide to have Sally act as her care manager for the rest of her life. In other words, Sally’s mother could pay make a lump sum payment based on her own life expectancy to her daughter.
For example, if Sally’s mother has a life expectancy of 11 years, she could pay Sally $47,520. (i.e. $360 per month times 12 months times 11 years) Additionally, she could pay the $47,520 up front in one lump sum.
If her mother can pay Sally upfront for years’ worth of services, this would allow Sally to provide the care that her mother needs while helping her mother qualify for Medi-Cal at the same time.