Caregiver needed? This is a wake up call for the aging baby boomer generation. What is a family care giver contract and why would it be in your future? This is a formal contract under which family members are paid to care for the aging senior in their life. Before you get make a negative judgment on this practice, I ask you to hear me out.
The aging baby boomer is experiencing a phenomenon never experienced by past generations. As we are living longer and healthier lives, we have found ourselves providing care for our parents long beyond expectations. In fact, studies revealed that there are over 50, 000 family members providing over $ 300 billion dollars of free or uncompensated care each year.
Many family members get upset over the idea that they would get paid for providing care for a family member. There is a sense of obligation and family commitment. I understand that. I have been financially and professionally impacted by my decisions to provide care and support for the family members in my life. So it was with great hesitation that I started explore this as an option for other family members. I now understand the benefits and the impact a formal written contact can have on the family and the aging senior receiving the care.
Providing care for an aging family member can be overwhelming and demanding. There is nothing that prepares you for this commitment and responsibility. Studies show that a family member caring for an aging senior can lose more than 70% of their earning power for every year that they continue to provide ongoing care. Caring for an aging senior can be a commitment that goes on for many years. Many did not realize what a time commitment, emotional and financial drain it would have on their lives.
I have found that there is usually one family member that takes on more responsibility and a larger portion of the care provided. Over time, frustration, resentment and anger towards the uninvolved siblings and other extended family members becomes an issue. Some family members, in order to save their inheritance willing provide care with out any kind of written agreement in place, only to be disappointed when the money goes to a nursing home.
More on the aging baby boomer generation alert. Is there a family care giver contract in your future?
Nothing affects a family relationship like money or the thought that you are entitled to money from an estate or as part of an inheritance. Many times the family member that has provided care, support and made the personal and financial sacrifices to care for the aging senior is the subject of family ridicule and lawsuits after the aging senior's death.
There are many more scenarios like this that have led me to see the benefits of a family care giver contract. There are other situations that have had an impact on the increase in utilizing a formalized written contract.
The aging baby boomer wants to age in their home and their community. Many are trying to assist their own senior parents to accomplish that, as well. Many are finding "sticker" shock at the cost of assisted living and nursing home placement. To the surprise of the baby boomer they are discovering that should their aging parent need nursing home care, it costs over $ 5,000 a month. To qualify for Medicaid, a federal and state program that will pay for long term care, the system must "look back" 5 years and investigate the aging senior's assets. It is presently being discussed that this "look back" period be extended to 7 years.
This means that if an aging senior has given their family member any financial gift or home in those past 5 (soon to be 7 years) this would be considered part of their assets. If the assets were estimated at $ 250,000 dollars and the nursing home is $ 5,000 a month, the aging senior would not qualify for payment assistance for 50 months. They would be private pay for those 50 months, even if they had given that asset away in the 5 year "look back" period. A formalized contract can be viewed as compensation for services rendered, instead of as a gift. This could have an impact on Medicaid qualification.
To the aging baby boomer generation: don't be quick to pass judgment on those that implement a family caregiver contract. You should contact an elder law attorney to find out if there should be one in your future.