Getting paid for caregiving: How to

States may provide payment for caregiving through Medicaid or the Department of Veterans Affairs (VA). Eligibility requirements vary by state, and the amount of compensation depends on the state and the care recipient’s specific needs.

When a person with a disability or an older adult, such as an aging parent, requires daily support, a member of their family often takes on the principal caregiving role.

Supporting an adult with complex needs can take a great deal of time and energy. In addition to the physical and emotional challenges, there can also be financial concerns.

Because of this, it is important for caregivers to be aware that, in specific situations, they may be eligible for financial compensation from their state as their loved one’s official caregivers.

Such support generally comes from Medicaid or the Department of Veterans Affairs (VA) on a state level. Eligibility requirements may differ depending on the specific state and the specific needs of the person requiring care.

The following information provides an overview of these caregiving compensation programs and how to apply for them.

Generally speaking, state governments do not compensate family members for providing care directly, but some states may provide programs that pay stipends to caregivers.

Medicaid is one option. Eligibility for Medicaid is determined by income level and, in some cases, other criteria, such as being a U.S. citizen or permanent resident, living in the state in which one applies, or having a medical condition that qualifies a person for Medicaid even if they don’t meet the income requirements.

In some states, Medicaid offers a Medicaid Home and Community-Based Services (HCBS) waiver program that compensates family caregivers as long as they and their loved ones meet the eligibility requirements.

Medicare and Medicaid are both government-funded health insurance programs, but they operate differently.

Medicaid eligibility depends largely on income, while Medicare eligibility usually depends on age or medical history. The federal government manages Medicare, whereas states administer Medicaid.

Medicare does not cover caregiving or personal (custodial) care, though Medicare Part B may cover caregiver training in some circumstances.

Another option is the Department of Veterans Affairs Program of Comprehensive Assistance for Family Caregivers (PCAFC), which offers monthly payments to caregivers of veterans or service members.

Benefits may also include health coverage, free mental health counseling, and respite care. Eligible caregivers include spouses, children, parents, stepfamily, or extended family members.

Medicaid HCBS eligibility requirements depend on the state, but generally, the care recipient must be a Medicaid beneficiary based on income and show that they require a nursing facility level of care, such as help with daily living tasks or medical support, such as nursing or rehabilitation.

The PCAFC applies to caregivers of veterans or active service members being discharged with a service-connected disability rated at 70% or higher and who have needed in-person help for at least 6 of the past 12 months.

People should remember that a loved one associated with the military who is receiving care might also be eligible for additional financial support through the VA’s Aid and Attendance Benefits (A&A) program. This support can go toward caregiving. In this case, the care recipient must already have a VA pension to qualify.

Under the HCBS program, caregiving compensation varies by state, but the median hourly rate for personal caregiving is approximately $19, according to the nonprofit KFF.

The PCAFC payment amount, meanwhile, is determined by the care recipient’s specific care needs, the caregiver’s location, and the local cost of living.

For A&A, the payment amount will also depend on the individual situation of the care recipient, such as whether the care recipient has dependents.

The following chart compares the application process for HCBS versus PCAFC. However, it is important that a person remembers that the specific steps and requirements will vary based on the state program where they are applying.

Medicaid and the Department of Veterans Affairs (VA) offer caregiver compensation in some states, but caregivers and care recipients must follow rules regarding eligibility. Funding is determined by state rules and the care recipient’s level of need.

If the care recipient is ineligible for Medicaid or military-related benefits, there may be additional funding options. Some states offer paid family leave that allows caregivers to take time off while being compensated. Certain long-term care insurance plans pay family caregivers to meet participant needs, but terms can vary from plan to plan.

Payment amounts, paid leave, and eligibility requirements vary, so it’s key that caregivers check directly with the state labor office.