Caring for a loved one with dementia, such as Alzheimer’s disease, can be a difficult task. Often this task falls to a family member, and as the disease progresses, the care needs become greater, requiring more hours of the caregiver’s time. In fact, the caregiver might need to cut back on their work hours or quit their job altogether in order to provide the care their loved one requires. Fortunately, in the US, it is possible for one to be paid to care for a loved one suffering from dementia. There are variety of different programs that offer this option. However, there can be significant hurdles in the process. One must be patience and persevere.
Medicaid is a nationwide program but its benefits, eligibility requirements and other rules are state specific. In most, but not every state, Medicaid offers at least one program that can be used to pay family members for their caregiving efforts. There are several different types of Medicaid through which a family member might be compensated. Readers should be aware that compensation might not always refer to cash compensation.
1) Medicaid Waivers
The most common way family members are compensated for caregiving is through Medicaid Home and Community Based Services Waivers (HCBS Waivers). Most, but not all, states offer HCBS Waivers. As the name indicates, services are provided in the home and community. This is ideal for those with dementias who do not require 24-hour supervision and prefer to remain living in their home. A perk of these HCBS Waivers is that many of them allow for “consumer direction”, also called self-direction. This means when it comes to choosing a personal caregiver they can self-direct or choose whomever they want. They can choose a family member, often an adult child or sometimes even a spouse to assist them with everyday tasks. This might include helping the senior with dementia pick seasonally appropriate clothing to wear, reminding him or her of doctor appointments and providing transportation, choosing and preparing healthy meals, and doing laundry and light housecleaning.
Medicaid provides the care recipient with a financial allowance instead of providing them with care services (this was originally referred to as a “Cash & Counseling” program). The Medicaid beneficiary then compensates their caregiver / family member from that budget. Medicaid waivers have limited enrollments slots available and often times states have wait-lists.
2) Medicaid State Plans
While each state has a Medicaid State Plan, the specifics of the program may vary based on the state in which one resides. However, most states offer personal care services through their state Medicaid plan. Often states allow family members to be personal care providers. In other words, Medicaid pays a family member to provide personal care for their relative suffering from dementia.
Medicaid state plan services often higher more strict financial eligibility criteria than a state’s HCBS Waivers, but these programs are entitlements. Meaning, these program do not limit enrollment.
3) Adult Foster Care
In many states, foster care programs are also available via Medicaid. This arrangement allows an individual with dementia to move into the home of a caregiver and receive around the clock supervision. This is a great way for someone who cannot live on his or her own and does not want to move to an institutional setting, such as a nursing home, to receive the care needed to remain in the community. Another huge bonus with foster care is that many states do allow family members to provide the foster home. To be clear, one cannot move into the home of their spouse and receive care, but they may be able to move into the home of their adult children or sibling to receive care.
These programs do not contribute to the cost of room and board, but they do provide compensation for providing care for the individual with Alzheimer’s. As those with dementia seem to be forgetful, this care might include reminders to bathe, to comb one’s hair, to change from pajamas to everyday clothes, or to take their medication. It might also include preparing healthy meals, driving the individual to appointments, and doing their laundry. Foster care programs may be through the state Medicaid program, a Home and Community Based Services Waiver, or a managed Medicaid program. Once again, this will vary by state.
4) The Caregiver Child Exemption
Sometimes called the caretaker child exception, is a Medicaid exemption that is relevant for an adult child who has a parent with dementia. It is somewhat similar to foster care, in that the adult child lives with his or her parent and provides a high level of supervision and assistance with daily activities. However, in this situation, the adult child moves into the home of his parent with dementia to provide care. They don’t receive compensation directly from Medicaid. Instead, state Medicaid rules usually require that a home be forfeit in exchange for care. This Exemption allows the home to be transferred to the adult child and in this way, they are compensated for providing care. Caregivers must reside and provide care for their parent for a minimum of 2 years for this exemption.
Depending on the financial situation of the individual with Alzheimer’s or related dementia, he or she may qualify for Medicaid. In general terms, if a senior has income under $2,200 and liquid assets under valued under $2,000 not including their home, he or she will likely qualify for Medicaid. Each state has different financial rules, care need rules and spousal protections, though many states are similar. Furthermore, each of the programs described above may have different eligibility criteria. More on Medicaid eligibility.
It should be noted that when looking to qualify for Medicaid it is important to do it right, so as not to violate Medicaid’s Look Back Period. This is a period of time that Medicaid looks back on all financial transactions and if it is found assets were transferred below fair market value, it can result in a period of Medicaid ineligibility. Persons who finances exceed Medicaid’s strict requirements might still become eligible through working with a professional Medicaid planner. Learn more.
In addition to the Medicaid options listed above, there are also non-Medicaid state programs that pay relatives to provide care for a loved one with dementia. These programs, like many of the Medicaid programs, allow the consumer (the individual who requires care) to choose the caregiver that they see fit to provide the care. Unfortunately, not all states offer these types of programs and they are difficult to find and usually limit enrollment. The American Elder Care Research Organization make a strong effort to track these programs.
For seniors with dementia who are veterans, there are veteran-specific programs that assist in paying for care. For instance, as part of the VA Medical Benefits package, Veteran-Directed Home and Community Based Services is available. This allows seniors with dementia to receive care in their home and community via funds from a flexible budget, rather than require nursing home care. Since the services are veteran-directed (self-directed), he or she can choose the caregiver of their choosing. This means a family member can be paid to provide the care that is needed, which may include a variety of services to assist the individual with Alzheimer’s.
2) A&A Pension
Another option for veterans, and their spouses, who served during a period of war is the Aid & Attendance Pension. This pension is intended to assist with the cost of long-term care and is ideal for those who are suffering for dementia. As Alzheimer’s progresses, not only will the senior need reminders to perform daily activities, such as brushing one’s teeth or washing one’s hands, physical functioning will also be affected. One may need assistance with eating, dressing, moving from one location to another, using the bathroom, and so forth. The Aid & Attendance Pension is intended for those who require assistance with the above daily living activities and is an extremely desirable option since veterans can choose their own caregiver, including relatives. However, because the VA counts a spouse’s income when considering eligibility, Aid & Attendance cannot be used to pay a spouse as a caregiver but can be used to pay adult children and other family members.
Four states (California, New Jersey, New York and Rhode Island.) currently offer Paid Family Leave Acts. Washington DC will be joining these states in 2020. With this option, it is the relative’s employer that provides pay (at a reduced rate) while he or she takes a leave from work to provide care for his or her loved one. This leave can generally be up to 6 weeks, though Rhode Island limits it to 4 weeks. While this isn’t a long-term solution to providing care for a loved one with Alzheimer’s, it does allow for a short-term solution. For instance, it might be ideal to take this leave when the individual with dementia is on the cusp of requiring nursing home care but is still able to live at home if a family member is able to provide care. Alternatively, instead of taking 6 consecutive weeks of leave, a caregiver may elect to take one day each week throughout most of the year to provide care.
Long-term Care Insurance is another possibility for family members to be paid for providing care for a loved one with dementia. Each policy is different, so one will need to determine if their specific policy will indeed pay relatives for providing care. Some policies that do allow relatives to be paid caregivers require that the caregiver be certified to provide care. However, this is a rather simple process and one should not feel intimidated. Alternatively, if relatives are not permitted to be paid, one might consider forming a home care agency and hiring and paying the agency instead. In some states, this workaround approach may be adequate.
Applying tax deductions, while not technically a way to be paid for providing care, is a way to offset the cost of care. For example, say your mother who is suffering from Alzheimer’s lives in your home and you are fully supporting her. As a result, you can deduct certain medical expenses from your taxes, such as the cost of doctors’ visits, prescription drugs, and home modifications that are medically necessary, such as grab bars.
One may also apply a tax credit (child and dependent tax credit) if he or she pays for a dependent person with dementia to be cared for while he or she is at work. Again, while it doesn’t directly pay the family member for providing care, it does decrease the amount of taxes one will owe, in turn, saving the individual money.
As one can see, there are several ways to get paid to provide care for a loved one suffering from Alzheimer’s disease or another dementia. Since each situation is highly personal, all the circumstances should be carefully considered in order to find the best solution for you and your family.