What You Should Know About Family Care Contracts

The tight economy has prompted more of us to rely on family members to care for frail and aging loved ones, rather than pay for outside professional services. When the need is great, some family members give up their jobs to help out at home. Some elders also want more control in choosing their care providers.

The result: a growing trend toward families who are considering compensating family caregivers for their time and effort.

Massachusetts Provides Funding for Family Caregivers
Massachusetts is among several states that recognize and support so-called consumer directed care. Two Massachusetts programs, the Personal Care Attendant (PCA) program and Caregiver Homes, provide state funds for recipients to either hire their own caregivers or to pay family caregivers for care they are providing. The care recipients must be eligible for MassHealth, a state subsidy program.

Care providers can be family members other than spouses or persons legally responsible to provide care, such as parents of minor children or legal guardians. Adult children can be paid caregivers as long as they are not the legal guardians of the care recipient.

State compensation for family caregivers is one alternative. For those with means, another option is for the elder to enter into a private-pay contract with a family member. If your family chooses to go this route, here are some guidelines:

Family Care Contracts Make Expectations and Agreements Explicit
What is a family care contract? It’s an agreement between two people, the family member who is providing service and the elder recipient, which defines what services will be provided and exact compensation. We recommend family care contracts because they clarify both parties’ expectations about specific care to be provided—the caregiver’s responsibilities and what the recipient will pay for those services.

A family care contract also provides documentation for other family members. This helps to avoid misunderstandings, especially when estates are settled after the elder’s death. These contracts may also be used to document that payments to caregivers are wages, not gifts, if there is a Medicaid application in the future.

Contracts may be initiated by your family’s elder law attorney, your elder’s care manager, the caregiver, the caregiver’s family or the care recipient.

Contracts Should be Based on a GCM’s Professional Assessment
Geriatric care managers (GCMs) play an important role in developing a family care contract; because the contract must describe the services to be provided and compensation, it should be based on a professional needs assessment. The assessment should include the following elements:

  • A narrative description of your elder’s situation and background, family response, need for services and how they have been provided to date. This is the place for the GCM to tell the care recipient’s and caregiver’s story.
  • A detailed assessment of your elder’s functional capacity to perform Activities of Daily Living (ADLs) and Instrumental Activities of Daily Living (IADLs).
  • How services are provided, by whom, including the time involved to perform services and whether tasks are shared with others.
  • Costs to the caregiver for providing services, including financial, time, health and lifestyle changes.
  • Valuation of services based on local cost comparisons. Assessments may include several different models to consider, such as hourly, daily and weekly costs; live-in versus awake/overnight; agency versus private rates. This is probably the most important piece of the assessment, as it is used to set the compensation in the contract.

This assessment process also offers the opportunity for your family and GCM to discuss other possible services that could benefit your loved one. Be sure to consider all of your options and to weigh carefully the benefits of keeping it “within the family” versus the costs of stress, as well as physical and emotional endurance that are intrinsic to the caregiver role.

President of Deborah Fins Associates, PC, since 1995, Deborah Liss Fins is a licensed independent clinical social worker and certified geriatric care manager. Drawing on more than 30 years of professional experience in geriatric care management, DFA offers comprehensive assessments and planning, guidance in selecting appropriate care, help identifying resources for financial support and professional consulting. Please contact us to set up a complimentary initial telephone consultation.

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