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Caregiver Agreements

Posted 5 years 143 days ago ago by Danielle Streed

When it comes to providing care for an aging family member in the home, many children or grandchildren are willing to provide the care or assistance needed. In many situations the caregiver may leave a current job or be in a position to provide the time and assistance to help out the family member. In most situations, the caregiver is giving up 5-7 days a week of their time and will need to be compensated.  Some caregivers are able to keep the family member in the home for many years and avoid the need for nursing home care.  However, at some point that family member may reach a level of care that cannot be provided by the caregiver (they are just a helper and not a qualified nurse) and placement in a nursing home becomes necessary.

Typically, the agreement to pay the caregiver is informal and is not handled by a written contract.  It may be that the family has agreed on a monthly amount with no outline of what the actual payment is for or the services to be provided. It all comes down to conversations and verbal agreements.  The problem with this informal arrangement is that DHS (the governing entity for the State of Michigan Medicaid) will consider these payments to the caregiver as a divestment or as a gift and ultimately these payments may cause the family member to be denied Medicaid coverage when the need arises.  It is important if you are going to provide caregiving services to a friend or family member that a formal caregiver agreement be prepared and signed by all parties. It is also important that the caregiver report the income and that the family member receiving the care file the necessary tax paperwork to show the salary paid. Otherwise Medicaid coverage may be denied!                

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