How Disability Insurance Can Offer Much-Needed Support to Caregivers

american disability act

Today we are recognizing and celebrating National Disability Independence Day. On this day in 1990, the Americans with Disabilities Act (ADA) was signed into law. The ADA is a crucial piece of legislation as it provides protection from discrimination as well as better access to necessary goods and services to people with disabilities.

National Disability Independence Day doesn’t just celebrate the anniversary of the ADA; it’s a symbol of the societal barriers broken down, the advancement of assistive technology and the progression towards accessibility and inclusion.

It also celebrates all those who make tireless efforts to ensure that people of all abilities have fulfilling, happy lives. Caregivers often dedicate a lot of their time and resources towards their dependents. The good news is there are benefits that can help support caregivers, allowing them to provide the best possible care.

Dependent Care Accounts (DCA): The Basics

By offering a Dependent Care Account (DCA) as part of your benefits package, you can help your employees take care of their people without additional financial stress. Since DCAs allow employees to fund their accounts with pre-tax dollars, they get the same financial benefit as a 30% discount on their adult dependent care expenses.

Employees can elect up to $5,000 this year to be put into their DCA and receive their money on a per-payroll basis. That money can be accessed via a mobile app, smart-debit card or direct deposit so it’s easily accessible when and where it’s needed.

DCA funds can be used for a variety of child and adult care expenses, as long as supporting documentation is presented. Eligible expenses include (but are not limited to):

  • Adult day care centers
  • Custodial, dependent or elder care
  • In-home care
  • Transportation to and from eligible care
  • Registration fees for eligible care

You can find a full list of eligible care expenses here.

How DCAs Further Support Caregivers

While the tax savings is a great way to ensure more resources are available for dependent care, the benefits extend far beyond that.

About 60% of caregivers work outside of their care duties, according to the Mayo Clinic. They are essentially juggling two full-time jobs: their employment and caregiving. This can be overwhelming and lead to what’s known as “caregiver stress,” which can lead to mental and physical issues.

The majority of caregiver stress stems from the financial burden of caring for others and the feeling of having constant responsibility with not enough time. A DCA helps alleviate both. Pre-tax dollars allow for more of an individual’s income to go towards care expenses rather than taxes, allowing caregivers to get more professional assistance which gives them time back in their day. There is also peace of mind associated with knowing you can provide the best possible care to your loved ones, even when you have other responsibilities.

Make DCAs Simpler with Clarity

Clarity has the tools to help make DCAs simpler and more accessible for your employees. With Mobile Pay, Personal Wallet and a Clarity Benefit card, individuals have more ways to organize their funds and get their reimbursements.

Visit our dependent care page to learn more about benefits solutions that make life better for caregivers, for now and in the future.