Many families reach a point when they see that an ill or older relative needs more than occasional help. But who’ll provide that care? The answer is usually close to home: an adult child. A child might be the default choice, or is selected because they live closer or have fewer family responsibilities.
The person providing care for a loved one may make a significant sacrifice like giving up a job or employment benefits. A formal agreement among family members can provide a way to compensate a person providing care if he/she is no longer able to hold other employment. While most families wish to help care for a loved one, it’s a job with heavy time commitments and responsibilities. One way of protecting the caregiver and the person receiving care is by putting the care relationship in writing. This is most often referred to as a “personal care agreement.”
What Is a Personal Care Agreement?
The agreement is a contract, typically between a family member who agrees to provide caregiver services for a disabled or aging relative and the person receiving care. This agreement is commonly between an adult child and their parent, but other relatives may be involved, such as an adult grandchild caring for a grandparent. Drawing up an agreement clarifies for a family what tasks are expected in return for a stated compensation. It can help avoid family conflicts about who will provide care and how much money will change hands. For this reason, the agreement should be discussed prior with other family members to resolve any concerns.
When contracting with family, it’s wise to treat the agreement as a legal document. If a relative is receiving state supported in-home care, the agreement will show the state where the money is going. Also, it can offset any confusion among those concerned about bequests to heirs, and avoid misunderstandings later over the reduction of inheritance money.
Components of an Agreement
A personal care agreement has three basic requirements for a person to pay family for care:
1. The agreement must be in writing.
2. The payment must be for care provided in the future (not for services already performed).
3. Compensation for care must be reasonable. This means tasks performed should match “reasonable” or “customary” fees typically paid to a third-party for the same care in your geographic area.
A properly drafted agreement will contain the following information: date the care begins; detailed description of services provided, for example, “transportation and errands” (driving to medical, dental, adult day care, and other appointments) or “food preparation”; how often services will be provided (allow for flexibility in care needs by using language such as, “no less than 20 hours a week” or “up to 80 hours a month”); how much and when the caregiver will be compensated (weekly or biweekly); how long the agreement is to be in effect (the agreement should set time, such as a year or two years, or even over a person’s lifetime); a statement that the terms of the agreement can be modified only by mutual agreement of the parties in writing; and, the location where services are to be provided (allow for the location of the care to change in response to increasing care needs); signatures by the parties; and date of the agreement.
Do I Need a Lawyer?
You don’t need to hire an attorney, but it’s advisable when entering into a contractual relationship. There are various legal agreement template available. Here is one option you can explore: https://www.nolo.com/.
This article was reworked from a more extensive discussion of the topic at the Caregiver’s Alliance: https://www.caregiver.org/personal-care-agreements
—By Caren Parnes