How Much do Family Members Get Paid for Caregiving​

Family caregiving plays a crucial role in supporting aging parents, disabled spouses, loved ones with chronic illnesses, or children who have developmental disabilities.

Many caregivers immediately provide this support out of love and concern, but the financial strain of being an unpaid caregiver can be stressful. As a result, more people are exploring options for compensation and asking how to turn informal care into a sustainable role.

How much do family members get paid for caregiving depends on several essential factors: the care recipient’s eligibility, the state of residence, and the availability of programs such as Medicaid, veterans’ benefits, or private insurance.

Understanding these variables is the first step toward determining whether (and how) caregivers can receive compensation for the care they provide.

Factors that Determine Caregiver Pay

It’s critical to realize that there is no one program, throughout the country, that pays family caregivers. Each state has its own programs.

For instance, some programs pay family members. Others may not. Some states may allow payment for spouses. Others may not.

Some states may have multiple programs. Caregivers need to do their research to determine how specific programs can supplement their income.

Some common factors which can influence a caregiver’s eligibility for funds can include:

• The level of care the loved one needs.
• Whether or not the family caregiver is contracted through an agency or has formal training.
• The caregiver’s relationship with the recipient.
• The care recipient’s eligibility for different government programs, such as Medicaid, veterans, private insurance, or long-term care insurance.

Can Family Members Get Paid for Caregiving?

Unless a caregiver has some type of formal education, being a paid family caregiver can be a tough goal to reach.

In some cases, family members can get paid for caregiving. But there are many cases where family members may not receive any compensation.

When a caregiver asks to get paid, he or she is not asking for a handout. They’re simply trying to find a way to cover the expenses related to the time they’ve dedicated to caregiving. The hours spent providing home care for a loved one often come at the cost of lost income.

The issue is there are not many agencies, state programs, or government programs who pay family members and friends on a regular basis.

One of the biggest factors in determining whether a caregiver can get paid is whether or not the caregiver is a formal or informal caregiver.

Informal vs. Formal Caregivers

Informal caregivers are usually people who care for a family member, loved one, or elderly friend at no cost. Many informal caregivers also do not have the specialized training that professional caregivers have.

Being an informal caregiver can be rewarding, but their finances can take a hit. For instance, if a husband has to quit his job to take care of his wife full time, there will be no income coming in to help with the cargiving cost.

In addition, informal caregiving can only go so far until the caregiver may not provide enough care to meet all of the loved one’s needs. That’s where a formal caregiver steps in.

Formal caregivers are usually paid professionals. In some cases, formal caregivers can also be volunteers working for a charity.

In both roles, the caregiver is trained and can provide the services that informal caregivers are not able to offer. In some instances, formal caregivers can work in home environments.

Will Medicare Provide Support?

Medicare is a federal health insurance program for individuals who are 65 years or older. Unfortunately, Medicare, according to the eligibility requirements, doesn’t pay for long-term care services, such as in-home care and adult day services.

Medicare can cover costs of formal caregivers. Care recipients can also use medicare to pay for some of the expenses of taking care of a loved one even if the caregiver is informal. One example can be respite. However, the funds will not pay for family caregivers.

Will Medicaid Provide Support?

Medicaid is a combination of state and federal government funds for individuals with low incomes. (In some states, Medicaid may be known by a different name.)

Medicaid may offer some financial assistance. However, each state has different requirements.

Some states allocate Medicaid waivers which provide Home and Community Based Services (HCBS), which are targeted toward senior citizens and people, living with disabilities, who need financial aid to live in a home or community setting.

The waiver can cover expenses for:

• Attendant care
• Supervision
• Adult day care
• Respite care
• Homemaker services

Personal Care Agreements

To be eligible for any Medicaid funds, it’s important to have a personal care agreement (also known as a family caregiver contract, elder care contract, and personal services contract.)

Medicaid has a policy called the “Look-Back Rule” where senior citizens, meaning applicants for long-term care, cannot have transferred assets over a certain limit within a specific time frame. This rule discourages Medicaid applicants from giving away money or assets to qualify for the program.

Therefore, Medicaid administrators review all asset transfers during the “Look-Back Rule” period to determine if there were any transfers that have been paid. If a transfer is discovered during the “Look-Back” period, the applicant could face a penalty period during which they are ineligible for Medicaid.

A Medicaid applicant can legally pay a caregiver, without incurring penalties, if a personal care agreement is in place.

How About a Tax Credit?

If the caregiver is looking after a relative, they might be able to claim the loved one as a dependent care credit. In order to claim the dependent, the caregiver should not be listed as a dependent on any other tax return.

May the Department of Veterans Affairs (VA) Provide Support?

The VA may have a few options that can help family members get paid.

The Program of Comprehensive Assistance for Family Caregivers (PCAFC)

The PCAFC may provide funding for family caregivers, but both the caregiver and the veteran care recipient must meet specific eligibility requirements.

This Caregiver requirements list includes:

• Caregiver must be 18 years old.
• The caregiver is a spouse, son, daughter, parent, stepfamily member, or extended family member of a veteran, or the caregiver lives full time with the veteran.

The Veteran requirements include:

• The veteran was discharged from the U.S. military or has a date of medical discharge.
• The veteran needs at least six months of continuous, in-person personal care services.
• The veteran needs to be enrolled in VA health care.

You can find more information about PCAFC on its website.

The Veteran Directed Care Program

Veteran Directed Care, part of the VA’s Geriatrics and Extended Care Department, provides veterans, of all ages, a personal care budget they can use to hire caregivers to help with activities of daily living.

As a part of this program, counselors help veterans hire their own workers to meet their daily needs. 

State Programs Can Be an Option

There are some state programs which can offer financial assistance. These programs can vary by state.

Here are some resources to explore to determine if there is a state program for you.

The Family Care Alliance (FCA):

The FCA is an agency which provides services to family caregivers of adults who have physical and cognitive impairments, such as Parkinson’s, stroke, Alzheimer’s, or other kinds of dementia. The FCA’s website provides an online tool to find resources in your state.

The section called “Caregiver Compensation” has programs that help care recipients to hire a family member as their caregiver.

The Local Area Agency on Aging (AAA):

The local AAA may also provide information on whether your state’s Medicaid program can provide funds to pay for a family caregiver.

Local AAA administrators also manage the federally funded National Family Caregiver Support Program (NCSP), which was established in 2000. This program provides grants to the United States and its territories based on the percentage of people, in their populations, that are 70 years old or older.

There are many options. However, caregivers have to do research to find out what works for them. There are also home care agencies, such as All American Home Care, that can work with the resources you have.

Don’t forget, family caregivers are the unsung heroes of the healthcare system. They provide comfort, stability, and essential care to their loved ones, often with little to no financial compensation.

While the journey to becoming a paid family caregiver can be complicated and overwhelming, it is not impossible.

If you’re caring for a loved one and wondering whether you’re eligible for financial support, start by researching what programs are available in your state. Then, consider working with an elder law attorney or care coordinator to understand the requirements and submit the proper documentation.

Getting paid for caregiving won’t erase the emotional and physical toll, but it can help ease the financial burden and make it more sustainable for families who give so much of themselves every day.