A caregiver agreement comes up when a member of a family takes over the care of a sick relative. This often involves giving up some aspects of their life, like work or other benefits.
So, an attorney can draft a caregiver agreement, to compensate the caregiver for their time. It is in writing and sometimes is called a personal service contract.
There may be circumstances where these funds are not used. This brings us as to whether or not the state of Florida can recover against those funds.
What Role Does Medicaid Play?
Medicaid is financial help from states in the US, to cover healthcare. Low-income earners, the elderly, and people with disabilities are eligible for this program.
A personal service contract is one of several asset protection strategies used to shelter assets to obtain Medicaid in Florida.
Can Medicaid Recover Against Unused Caregiver Funds?
Under Florida law, the State of Florida can recover against non-exempt probate assets to pay back Medicaid.
The law expects that if the state supports you with aid, you should give back if you can. This is the basis for the Medicaid Estate Recovery Program (MERP).
This helps the state to fund Medicaid and provide financial aid for people in need. The state of Florida will not collect more than they have spent, and will only attempt to recover when the beneficiary dies.
What this means, is that Medicaid cannot recover money paid to a caregiver. This is because once the funds are paid to the provider, the money no longer belongs to the Medicaid beneficiary. The money belongs to the caregiver, as payment for services whether the beneficiary dies or not.
Under Florida law, there are several criteria that must be met in order for the personal service contract to be valid. The contract must be in writing. The term of the contract must be equal to, or less than the Medicaid applicant’s actuarial life expectancy, the payment must be “reasonable” and the payment must be for future services, and not a payment for past services provided.
Want to get more questions answered? Go to our audio interview series with transcripts now.
Not so sure you need an Elder Law attorney or Medicaid planning? Maybe not and read this first.