Medicare Reimbursement for Home Care Is Limited to Pros

Question: I’m living with my mother, who has the beginnings of Alzheimer’s. She is unable to function on her own because of her dementia. Physically, she is in good shape. Mentally, she gets quite confused and doesn’t even remember sometimes that I’m living with her. Can I get any reimbursement from Medicare for being a live-in caregiver? I am not getting paid anything. We live off her trusts and the estate of her late husband. I am 58 and gave up my job, my life in another state and my friends to take care of her. At this point I don’t feel comfortable leaving her alone for too long during the day and have decided it wouldn’t be wise for me to get a part-time job. Are there any financial programs I can investigate?

Answer: Ed Long, an attorney who specializes in elder law, says it’s extremely unlikely that Medicare would pay you for your work.

First of all, Medicare doesn’t pay for most home-provided care -- particularly the kinds of custodial care needed by people with dementia. What meager pay is provided goes for professionals. So Medicare would pay your salary only if you were a licensed nurse, Long said, and willing to work for a home-care agency that served clients other than your mother.

Some states, such as California, have programs linked to Medicaid that provide some support services for in-home caregivers.

Medicaid is a separate government program that does pay for custodial care -- but usually only for the indigent. Given your mother’s resources, your family probably doesn’t qualify.

Long suggests that you contact your local Area Agency on Aging, listed in the government section of the phone book, for more details and for other resources that might provide some help. Alternatively, you could talk to a geriatric care manager or an elder law attorney in your area.

If your mother is well off, by the way, you could arrange to be paid a reasonable salary from her assets. You’ll want to talk to the elder law attorney about the best way to do this. There’s nothing wrong with such arrangements, as long as the salary you take isn’t exorbitant.

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Closing Card Accounts Won’t Help Credit Score

Q: In your response regarding the effect on a FICO credit score when an account is closed, you gave some misinformation. As a well-informed mortgage broker whose entire business is built upon repeat clients and referrals, I have had the opportunity to view and track a consumer’s credit history and score fluctuations over an extended period. I have witnessed scores improving after accounts were closed. The scoring model perceives that a consumer with numerous credit cards is at a higher risk of credit problems than a consumer with only a few credit cards. The only way to eliminate this problem is to close accounts, or not open them in the first place. My purpose in sending you this letter is that I see consumers every day who are not able to obtain the loan they want for the home they want due in part to erroneous advice.

A: If you’re telling clients to close accounts in order to improve their FICO credit scores, then you’re the one handing out erroneous advice.

The company that creates the FICO credit score, Fair, Isaac & Co., says it unequivocally: Closing credit accounts can never help a credit score, and may hurt it.

That’s because the score measures the difference between available credit and how much is being used. The more available credit is being used, the worse the potential effect on the score. Reducing the total available credit by shutting down an account makes any remaining balances look bigger, proportionately.

You’re right in saying that too many accounts also can hurt a score. But once the account has been opened, Fair Isaac says, the effect on the credit score can’t be reversed by shutting down the line of credit.

Of course, the number of open accounts is just one of the numerous factors that help shape a score. Another is the passage of time. That may be why you’ve seen some scores rise after an account was closed.

Rather than making assumptions about how credit scoring works, you might want to contact the National Assn. of Mortgage Brokers, which has information and seminars for lending professionals on this topic. Your clients deserve a broker who truly is well informed -- not just one who thinks she is.

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Liz Pulliam Weston is a contributor to The Times, a columnist for MSN.com and a graduate of the personal financial planning certificate program at UC Irvine. Questions can be sent to her at asklizweston@hot mail.com or mailed to her in care of Money Talk, Business Section, Los Angeles Times, 202 W. 1st St., Los Angeles, CA 90012. She regrets that she cannot respond personally to queries. For past Money Talk questions and answers, visit The Times’ Web site at www.latimes.com/money talk.