By Attorney Mitch Adel
In a recent story in the Columbus Dispatch it was reported that while most believed that one of the causes of budget problems in Ohio was a result of the state paying nursing homes under the Medicaid programs, it was actually shown that the cost of the state pays for nursing home care has not increased since 2004. While the actual cost of a nursing home has increased since that time, the State acknowledged paying less for that service as an increasing number of people are seeking alternatives for their long term care, like assisted living or at home care. After discussing the issue with some of the clients of the Cooper law firm, they said they preferred planning for those alternatives to nursing homes, but understood the need for those services and reasons for protecting their assets.
One of the most preferred alternatives to nursing homes with our clients is caring for their family members in their own homes. While, the state of Ohio does have programs for at home care, unfortunately the amount of care they provide is very modest, in most cases those programs include a maximum of 20 hours a week. Fortunately for a good percentage of our clients that are Veterans or widows of veterans we have found that the the VA Aid and Attendance Pension benefit is a much better fit. Married veterans that qualify can receive $1,949 a month to be used to pay for medical expenses including bringing caregivers into the home. (A single veteran is eligible for $1,644 a month and the widow of a veteran is eligible for $1,056 a month)
One of the best fits for this benefit and at home care that we frequently use involves parents hiring their children to care for them. Families can obviously hire outside professionals to care for their loved ones at home, but, parents can also pay their children to care for them at home with monies received from the VA. I urge that if you do use this technique as your medical expense in the qualification of benefits you follow the appropriate formalities. Failure to do so might result in the VA demanding an overpayment. I have unfortunately had to represent families in dealing with the VA where the family could not prove the actual arrangement and as a result owed a back payment to the VA of thousands of dollars.
A few easy steps to ensure you are not involved in those VA demands is to make sure that you have a legally binding contract of care, even if signed between family members and making sure that you can prove that payments under such agreement have actually been made. Looking at these steps individually:
- Personal Care Agreement- The risk of not having a legally binding contract of care agreement is magnified in the event that the person receiving the care at home eventually needs other state benefits including Medicaid. If there was no agreement in place that could be proven to the state, the monthly payment amounts would be viewed as gifts or transfers in return for no value and could preclude qualification for state Medicaid benefits.
- Payments under a Personal Care Agreement- Being able to prove payments were made means that the person receiving the care, must be prepared to be able to show the VA cancelled checks to the caregiver and alternatively the caregiver must be prepared to show that they received the income and that they are filing this income with their annual income taxes.
If you are interested in alternative planning options to nursing homes or veterans benefits, please get in to see one of our qualified staff members as soon as possible.