Massachusetts Estate Planning & Asset Protection Blog

Massachusetts Elder Law Attorney | Can Paying for Home Health Aides Cause a MassHealth Penalty? (Part 2)

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Wed, Dec 19, 2012

Can Paying for Home Health Aides Cause a MassHealth Penalty? (Part 2)

There are two components to properly paying a home health aide hired without the assistance of an agency:

1. Enter into a Caregiver Agreement with the aide – this agreement lays out the duties of the aide and the rate.  In short, it provides New Jersey MassHealth  with a record that an individual was hired to care for the eventual applicant and that the money withdrawn from the applicant’s account was used in return for a service (i.e.; transferred for value).  Some aides may be hesitant to sign due to their fear of the IRS or INS (immigration).  We explain to our elder law clients that the purpose of this agreement is to document payment for services forMassHealth, Medicaid an eventual MassHealth  filing, not to report the aide to a government authority.  This, of course, does not excuse the applicant and the aide from reporting income.  We do not provide advice on IRS and INS reporting rules, nor do we offer any guarantees that MassHealth  will not communicate with other government entities, however, we do tell clients that, to our knowledge,it has never happened and is not likely given how expansive “the government” is. 

2. Maintain receipts – simply buy a book of receipts from an office supply store.  Have the aide sign a receipt each time he/she is paid noting the dates of services for which payment is being made and the services performed

It should be noted that hiring a home health agency is never a problem for MassHealth.  The contract with the agency is proof of the services provided and payments are made to the agency, not to the aide.  A red flag for MassHealth  are checks made payable to an individual.  When they see checks to “Jenny Smith” they assume it is a gift to Jenny, who, they presume, is a family member.  You know that Jenny has been working for years taking care of Mom, but remember that MassHealth  doesn’t know that, and again, a verbal statement, unsupported by supporting documentation, will not be enough.

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At the Estate Planning & Asset Protection Law Center of Dennis Sullivan & Associates, we help people and their families concerned with losing their homes and life savings to increasing medical and nursing home costs, taxes and the costs and time delays of probate. We also protect clients from losing control of their own health and financial decisions.

We encourage you to attend one of our free educational workshops to learn more about our process and what you can do to enhance the security of your spouse, home, life savings and legacy. To register for a seat at an upcoming workshop call (800) 964-4295 (24/7) or register online at


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