If you have a family member who is disabled and in need of in-home assistance, you may be looking for ways to make a living while providing home-based care for your loved one.
There are ways, as the friend or relative of a disabled individual, to get reimbursed for your time and efforts.
Below are seven programs that allow you to get paid to provide care for your loved ones:
1. Consumer Directed Personal Assistance Program (also known as CDPAP)
This program makes it possible for family members or friends to get paid through Medicaid to provide care to disabled loved ones.
2. Medicaid’s Cash & Counseling Program
Through the Medicaid Cash and Counseling Program, individuals receive a monthly stipend that they can use to buy goods and services including the provision of care by relative caregivers.
3. Veterans Aid
The U.S. Department of Veteran’s Affairs allows relative caregivers to provide assistance to disabled individuals and receive compensation as well as specialized caregiver training, mental health services, access to health care benefits, and coverage for costs related to medical appointments for the disabled veteran.
4. Long-Term Care Insurance Policy That Provides for Caregiver Compensation
Some long-term care insurance policies provide reimbursement to relative caregivers who provide in-home care to beneficiaries.
5. Determine Whether Your Company Offers Paid Leave for Caregivers
In certain states companies must provide paid leave to employees who must provide caregiving services to loved ones. In states where paid leave is not a requirement, some companies still opt to offer employees this benefit nonetheless.
6. Create a Caregiver Contract with Your Family
If you bear the burden of providing hands-on home care for a disabled family member and the rest of the family sees the value of what you’re doing, you may be able to create a binding legal contract to receive regular payments for your services
7. Indirect Payment Via a Tax Credit
The IRS provides up to a 30% tax credit on expenses related to caregiving. You can make up to $3000 per year under the Tax Credit for Caring Act.
The Consumer Directed Personal Assistance Program, also known as CDPAP, allows disabled individuals or a representative to hire and manage a home care provider of their choice.
Through CDPAP, a disabled person can hire trusted family members or friends who get paid for their time through a fiscal intermediary who works with Medicaid. CDPAP is one of the most straightforward and popular programs available to disabled individuals who would like to have loved ones provide care while receiving payment for their services.
CDPAP is a statewide Medicaid program that makes it easy for disabled individuals to hire trusted home care aides to assist them with their activities of daily living. This program gives the disabled person (referred to as the “consumer”) more control over who provides care and how the care is provided. The disabled individual or their designated representative works directly with a fiscal intermediary who acts as the middle-man between the consumer and Medicaid.
Who Qualifies for CDPAP?
Traditional home care agencies hire, manage, and schedule home care aides to care for their clients without consulting the clients about their selection. Under this traditional model of home care, the disabled individual has no say in how their home care aides are trained or managed. Often they still rely heavily on care from loved ones.
Through CDPAP, the person receiving care is given more control over their home care and those providing care have the opportunity to receive payment in return for their services.
If you are disabled and you’re eligible to receive Medicaid-reimbursed services from any of the following you may also qualify to hire a home care aide through CDPAP:
· A certified home care agency
· An AIDs home care program
· A private duty nursing service
· A personal care or home attendant
· A long term home health care program or waiver
If you have a stable medical condition, your CDPAP aides may be able to provide a more advanced level of care than a traditional agency-selected home care aide. Normally, disabled patients must pay more to receive more advanced level nursing care, but through CDPAP, trusted loved ones can perform skilled nursing tasks and get paid to do it.
In order to qualify for CDPAP, you must be able to direct your chosen home care aide yourself or have a designated representative who can do this work on your behalf. The willingness and ability to hire, train, and manage home care aides is a requirement for participation in this program. Both Managed Long Term Care and Managed Care plans must offer a CDPAP program and let their customers know that they are eligible to participate. If you’re not sure whether you qualify for CDPAP, contact your managed care provider to find out.
How to Apply for CDPAP
Most counties require consumers or their designated representatives to fill out a CDPAP application to demonstrate that they are capable of selecting, training, and managing their home care aides.
Medicaid’s Cash and Counseling Program
The National Resource Center for Participant-Directed Services (NRCPDS) is responsible for administering Cash and Counseling programs. The Medicaid Cash and Counseling Program is another participant-directed care service that provides disabled individuals with cash assistance through Medicaid along with the ability to receive self-directed services.
Under this program family members can act as their own “home care agency” and work as paid caregivers for a loved one who qualifies for Medicaid. Disabled individuals receive a cash budget and they can use those funds to manage goods and services related to their personal care needs.
Medicaid’s Cash and Counseling Program has a lot in common with CDPAP and other Consumer Directed Care programs, but they are based on HCBS Waivers. Disabled individuals (or their representatives) act as employers. They decide how the budget will be allocated. Family members can be hired to act as home care aides.
As with the CDPAP program, a fiscal intermediary is required in many states to make sure that hours are properly tracked, adequate training is provided to home care aids, back-up caregivers are available, the necessary payroll taxes are paid, and that all administrative needs are taken care of with Medicaid.
Who Qualifies for Medicaid’s Cash and Counseling Program?
To qualify for the cash and counseling program, the disabled individual must be eligible for Medicaid. Medicaid eligibility is determined according to the following criteria:
· The Cash and Counseling Program is currently available in 15 states for those with disabilities or senior citizens.
· In most states, the disabled individual must have an annual income of less than $27,756. Couples who wish to apply for Medicaid together must fall below different income and asset limits to qualify.
· The disabled individual must have assets that are valued at less than $2000 (excluding their primary home).
Disabled individuals who have already qualified for Medicaid must be willing to undergo an assessment to determine their exact needs. Nursing home residents do not qualify to participate in Cash and Counseling Programs. The assessment typically involves an interview with the disabled person’s caregivers and doctors to determine the number of monthly care-hours required. Then, the budget is calculated based on the consumer’s location, though this amount may change over time.
Qualification for this program depends on the level and type of care that the disabled individual requires. Below are types of care that determine eligibility for this program:
· Skilled nursing
· Severe mental impairment
· Assistance to perform Activities of Daily Living (grooming, dressing, toileting, bathing, eating, etc.)
How to Apply for Cash and Counseling Programs
To apply for Medicaid, fill out an application at a state or county Medicaid office or seek the assistance of a Medicaid planning expert to improve the odds and speed up the process of being accepted. Once you’ve been accepted by Medicaid, apply for the specific waiver that applies to the Cash and Counseling program. There is no cost to apply for Medicaid or for the waiver application.
Veterans who receive aid from the U.S. Department of Veterans Affairs may be able to appoint a relative as their primary caregiver. They can also appoint two other secondary caregivers, if so desired, who can serve as “backup” should the primary caregiver need assistance or support.
Caregivers of veterans are eligible to receive compensation from the US Department of Veteran’s Affairs so long as they can provide the necessary documentation. Primary caregivers may be able to receive not only compensation, but also caregiver training, mental health services and counseling, access to health care benefits through CHAMPVA (Civilian Health and Medical Program of the Department of Veterans Affairs), and coverage of travel, lodging, and other costs related to traveling with the veteran to medical appointments.
Who Qualifies for Relative Caregiver Compensation through Veteran’s Aid?
The PCAFG program requires that the veteran applicant fulfills the following requirements:
· The veteran must have been discharged from the US military or have a near-future date of medical discharge.
· They must have a serious injury (physical, mental, or psychological) that was caused or made worse by active-duty service on or after September 11th, 2001.
· They must require at least 6 months of continuous care services.
· The caregiver must be at least 18 years of age and be the spouse, child, parent, stepfamily member, or extended family member of the veteran.
· The caregiver must also be currently living with the veteran in the same residence or be willing to live in the same residence to provide care services.
The PGCSS program, in contrast, has different rules for relative caregivers. Below are the requirements for caregiver compensation through the PGCSS program:
· This program is available for veterans who have served in any era, and they are not required to have a service-related condition of any kind.
· The caregiver must be 18 years of age.
· The caregiver must be the relative of the veteran.
· The caregiver must be willing to reside with the veteran in order to be able to provide care.
How to Apply for Veteran’s Aid
To receive compensation as the caregiver of a veteran, you and the veteran (your loved one) will need to apply together to the Program of Comprehensive Assistance for Family Caregivers (PCAFG). You can apply online, on the phone, or through mail. If the veteran you will be caring for does not meet the requirements for the PCAFG program, they may still meet the requirements for the Program of General Caregiver Support Services (PGCSS).
To start the application process for Veteran’s Aid and caregivers’s compensation under the program, call the VA’s Caregiver Support Line at 1-855-260-3274, or contact your VA planner for assistance in the application process. You may also contact a local Caregiver Support Coordinator for advice.
Long-Term Care Insurance Policy that Provides for Caregiver Compensation
Long-term care insurance is a special type of health insurance that covers specific services pertaining to personal or custodial care in settings such as the home, community organizations, or nursing facilities. These types of facilities typically provide a daily allocation of funds for the provision of care services including activities of daily living and nursing care.
Who Qualifies for Long-Term Care Insurance Compensation?
If your loved one currently has a long-term care insurance policy that covers the costs of caregiver fees, you may be able to receive compensation under the rules of this policy.
However, keep in mind that some policies may not cover the costs of a caregiver who is a spouse or relative, so it’s important to look into the details of the caregiver compensation rules that apply to your loved one’s specific long-term insurance policy.
Some things to look for when examining a long-term care insurance policy include:
· Whether or not the policy covers non-medical services
· Whether or not personal care services within the home are covered
· Whether or not the benefits are paid directly to the policy holder or if they will be paid directly (and only) to a licensed caregiver.
In the case that the benefits are paid directly to the policy holder, the use of a caregiver contract with the other members of your family may be necessary. By making a contract, you can ensure that you are still receiving fair compensation for your services.
However, if the payment may only go to a licensed caregiver, the CDPAP program may be a better fit. Otherwise, pursuit of a caregiver license may qualify you to receive compensation under your loved one’s insurance policy as long as the policy doesn’t prohibit family members from acting as caregivers or the use of personal care providers who reside in the same home as policy holders.
If the caregiver of the disabled individual is a spouse, it is mutually beneficial for the couple and the insurance provider to receive payments directly from the insurance policy holder. However, if the caregiver is not a spouse, but rather a different relative, then other arrangements will need to be made to ensure that fair compensation is given to the caregiver-relative from the insurance provider in satisfactory manner.
How to Apply for Long-Term Care Insurance Compensation as a Relative Caregiver
If your loved one has long-term care insurance, find out whether caregiver payments are reimbursed through the policy. To find out whether your family member’s policy covers in-home care provided by a family member, contact the insurance company to inquire about the details of their caregiver payment benefits.
Determine Whether Your Company Offers Paid Leave for Caregivers
Some states in the U.S. are required to provide paid leave for caregivers. Other states aren’t required to provide these benefits, but certain companies may still choose to offer their employees paid leave to provide caregiving services to family members.
Paid leave is preferable for many people, since it may be possible to maintain a job outside the home while also being able to take some time off to care for a loved one in need. If you want to maintain your current job while also providing care services at home, this may be the ideal situation.
Who Qualifies to Receive Paid Leave for Caregivers?
In New York, California, New Jersey, Connecticut, District of Columbia, Rhode Island, and Washington, paid leave for caregivers is already a benefit that must be provided by all companies. There are a few other states that may be offering required paid leave for caregiving in the future, too.
Currently, there is a variable maximum benefit amount that may be paid to caregivers during the time when they are not present at work because they are providing care to a loved one. For example, in California it’s possible for a person to take paid leave for up to 8 weeks in any 12-month period, and receive up to $1252 per week during this time. Other states have other specifications and benefit amounts.
How to Apply for Paid-Leave through Your Company
Ask your company’s HR department directly for details on what your state and company can offer you and inquire about your company’s specific requirements for qualifying and applying for paid caregiver leave. Different companies and different states may have different rules in place.
Create a Caregiver Contract with Your Family
A caregiver contract is an important legal document to create if you’re planning to care for a family member privately, especially if you need to ensure that the payment will happen regularly and with all the benefits of an outside job.
While a lot of individuals choose to care for their ailing family members without the use of a caregiver contract, having this particular document in hand can help you secure Social Security benefits down the road, and can also make it easier for your loved one to have access to nursing homes or other forms of care should you not be able to care for them at some time in the future.
A caregiver contract can come with all the benefits of a “regular” job in the eyes of the IRS and other legal institutions, and it also ensures that the care recipient gets valid, legal care too (which may make it easier for them to receive Medicaid benefits in the future as well).
Who Qualifies for a Caregiver Contract?
Anyone can qualify for a caregiver contract because this is a document that is created by family members with the aid of a legal representative.
Caregiver contracts, also sometimes referred to as personal care agreements, should include all the details of the caregiving arrangement, including the following information:
· The date of which the care beings
· A description of the care services that you will provide
· The amount of time each week that care services will be provided (for example, “20 hours per week” or “up to 60 hours every month” are flexible, effective ways to describe this time frame)
· An “expiration date” for the contract (this may be for only one year, or it could be stated to be in effect for the rest of your loved one’s life)
· Description of where the care services will be provided
· A final statement indicating that the contract may only be modified in writing with agreement from both signees of the contract
· The signatures of both you and your loved one
· The date the document was signed
How to Create a Caregiver Contract
Creating a caregiving plan for an elderly or ailing family member can be a stressful and complex process, especially if there are many family members involved in the decision making process.
For that reason, it’s usually best to arrange a family meeting to discuss certain finer details of the care that will be given, payment processes, Power of Attorney for the care receiver, and other similar matters.
Although it’s not absolutely essential to have a lawyer present, it may be valuable to seek the input and support of an experienced attorney who can review your caregiver agreement before you and your loved one (or their representative) signs the contract.
Indirect Payment via a Tax Credit
If you are a caregiver for a direct family member, you may be eligible to receive substantial tax credits from the IRS under the Tax Credit for Caring act.
Under this act, direct family members may be able to receive up to a 30% tax credit on their expenses that are related to caregiving costs (after the initial costs go over $2000 for the year). This credit can provide up to $3000 per year in income from tax credits for eligible individuals. This is an effective way to regain some of the money spent on medical care and caregiving expenses that were expanded throughout the year.
Who Qualifies for Indirect Payments via Tax Credits as a Relative Caregiver?
In order to qualify to receive tax credit as a caregiver of a family member, you must meet some requirements. Here are some of the qualifications you must fulfill:
· You must make at least $7500 per year in taxable income at the time that you apply for the tax credit.
· You need to have accurately recorded your expenditures in relation to caregiving costs.
· The individual you are caring for must be filed for as a dependent and also must be a direct family member (this includes children, parents, siblings, and spouses).
· Both you and your dependent must be legal U.S. residents or citizens.
· The dependent may not make more than the tax year’s cutoff amount (which was $4200 in 2019).
· Your family member must live with you in the same residence (for the whole year) and you must be responsible for paying at least 50% of their living expenses.
· You (the caregiver) are not a dependent on someone else’s tax return.
It’s important to note that not all expenses related to caregiving are deductible. There is a list of deductions that can be found at this link, which include the following:
· Cost of physical therapy
· Eyeglasses costs
· Prescription medication costs
· Costs related to transportation to and from medical appointments
· Acupuncture and qualifying alternative healthcare costs
· Home improvements to accommodate disabilities
How to Receive Tax Credits as a Relative Caregiver
When claiming a deduction for “other dependents” on your tax return, it’s best to seek out the guidance and support of an experienced accountant who can help you ensure that you get the maximum deductions possible and that you are following all the rules.