In Maryland, a personal care contract is a legal agreement between a future prospective Medicaid recipient and a caregiver, typically a family member, in which the caregiver agrees to provide certain services to the recipient in exchange for payment. The purpose of the personal care contract is to establish a formal arrangement for the caregiver to provide care services, and to document the compensation and responsibilities of the caregiver.

Under Medicaid rules, a personal care contract is an allowable expense if it is properly structured and the compensation paid to the caregiver is reasonable based on the local market rates for similar services. The contract must be in writing and include specific details about the services to be provided, the compensation to be paid, and the duration of the agreement.

A personal care contract can be an effective way to manage the cost of long-term care for Medicaid recipients who require assistance with activities of daily living, such as bathing, dressing, and grooming. However, it is important to follow the rules and guidelines established by Medicaid to ensure that the contract is recognized as a legitimate expense and does not result in a penalty or disqualification from Medicaid benefits.

It is recommended to consult with a qualified attorney or financial advisor to understand the specific requirements for personal care contracts under Maryland Medicaid rules.

Click here to visit RELEP’s Elder Law & Medicaid webpage.