Aging Options

The high cost of caring for an aging relative

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Almost 30 percent of Americans provide care for someone who is ill, disabled or aged according to the Family Caregiver Alliance. 

These informal caregivers shoulder a greater and greater portion of care for their loved ones as hospitals shorten the lengths of stays, medications and therapies provide better management of chronic conditions and the health care field experiences a shortage of available personnel to care for individuals.  The result is that the time spent caring for someone needing care has grown and the types of care requires more skill than simple companionship and meals.  The impact to the life of the caregiver is a wearing away of their own health and their finances as this article from the New York Times points out.

There’s a double whammy here in that generally the caregiver is a woman and as has been pointed out in previous articles, women face an uphill climb financially already due to lower wages and longer lives.  Taking time off to provide care might seem logical as well as nurturing however, the long term affect is an average $324,000 in lost wages, Social Security and pension benefits over a lifetime according to a MetLife and Caregiving Alliance 2011 study.

Women often feel they are between a rock and a hard place because even in-home care can be tremendously expensive.  Many people think that choosing to either provide for care or to pay for care are the only two options.  But, there are other options that won’t decimate either your health or your finances as much.

State Medicaid programs (in Washington state that is DSHS) are required to recover certain Medicaid benefits paid on behalf of an individual for services such as nursing home services, home and community-based services and related hospital and prescription drug services.  They may also have the option of recovering payments for other Medicaid services except Medicare cost-sharing paid on behalf of Medicare Savings Program beneficiaries.  In Washington, DSHS may file a lien or make a claim against any property including real property in order to repay the state for payments associated with Medicaid and long-term care services received prior to your death.   However, like most rules associated with the federal and state governments, there are exceptions.  For instance, a home can be transferred without penalty to a:

  • Spouse,
  • Any sibling with an equity interest in the home who has lived for at least one year in the home prior to the date of Medicaid eligibility,
  • Dependent children under the age of 21
  • A blind or disabled child

The Medicaid recipient does not need to be living in the home at the time of the transfer and DSHS cannot recover property solely owned by either a spouse or a child.

There is one other time that a transfer can be made without penalty.   Individuals with more than one or more chronic conditions and who would otherwise be moved into a nursing home but are able to remain at home due to the care of a child who has lived at home for a period of two years prior to the date of COPES coverage or institutionalization may also have a home transferred to that child in exchange for that period of care.  A child in this case is called the caretaker child.  However, making an incorrect transfer can potentially cost you the money you thought you might save so it’s best to get professional help either through a geriatric care manager or an elder law attorney.

Another option is to have the parent (or siblings) pay the caregiver for care either through a larger inheritance or just as he or she would if an outside caregiver was hired.  Once again, an elder law attorney can help to draft a caregiver contract and help to make the arrangement formal so that it can be recognized by all parties.  A family meeting can smooth the way so that siblings recognize the contributions of the caregiver and reduce any squabbles that may arise as a result from any such arrangement.

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