Let’s start with further digging into the Medicaid term, “cash and counseling”, as many other terms are used interchangeably. These may include “consumer-directed care”, “self-directed services”, and “participant direction”. That said, the name of a state’s self-directed Medicaid program varies based on the state in which one resides. Furthermore, states may have more than one participant directed program. Sometimes they are available through a state’s regular Medicaid plan, but are also commonly available through HCBS (home and community based services) Medicaid waivers. Please note that self-directed care is not available for persons residing in nursing home facilities.
Simply put, with participant direction, Medicaid recipients are given a monetary budget and have the freedom to direct their own long-term care services and supports. Most common, and most relevant, is the ability to choose, hire, train, and even fire, their own caregivers to assist with their activities of daily living (bathing, dressing, mobility, toiletry, transferring, and eating). Often these caregivers also provide assistance with light housecleaning, shopping for groceries, preparing meals, chore services, transportation, and laundry. (Upon hiring a caregiver, the care recipient essentially becomes the employer.)
Frequently, it is a close friend or a relative, such as an adult child, that the Medicaid recipient hires to provide care. Some states even allow seniors to hire their spouses as caregivers. This ability to hire the caregiver of a Medicaid recipient’s choosing is particularly beneficial when a friend or family member is already serving as an informal (unpaid) caregiver. When program participants are unable to make care decisions for themselves, a representative may be named to direct their care. However, the representative cannot also serve as the caregiver.
While the rules and regulations of self-directed care varies by the state in which one resides, we will provide a general overview of how the program works.
-If not already a Medicaid recipient, the individual must apply for Medicaid in the state in which he / she lives. Once approved for Medicaid, he / she must apply and meet the eligibility requirements to be a participant of a consumer directed program.
-A thorough assessment is completed to determine the senior’s functional needs. This may include input from one’s informal caregiver and physician.
-A care plan is established, which includes the type of care and amount of care that is needed, and an individual budget is set.
-The Medicaid recipient is able to hire the caregiver of his / her choosing and / or purchase other supports as approved in the care plan. In some states, the caregiver must have a background check, be registered and licensed as a care provider (personal care assistant), and undergo specific caregiver training. The amount a caregiver is paid also varies based on the state and the consumer directed program. On average, payment is between $9 and $15 per hour.
As mentioned above, with cash and counseling programs, the Medicaid recipient takes on the role of employer, including handling payment and taxes. Some state require that program participants utilize financial management service companies, also referred to as fiscal intermediaries, to handle these financial responsibilities. When a fiscal intermediary is used, a small fee for services is charged and comes out of the individualized budget. Stated differently, a portion of the budget that would otherwise be available to pay a caregiver goes towards paying the fiscal intermediary for their services.
To learn more about Medicaid financial assistance to provide care for a loved one, click here. Please note that there are other programs apart from Medicaid that offer consumer directed care. These include two veterans’ pensions (aid & attendance and housebound), the veteran directed care program (previously called the veteran-directed home and community based services program), state programs (non-Medicaid), and nonprofit programs.