Pro Tip: Are you ready to discuss care options with your loved one? Read my guide to in-home care that helps older adults age in place comfortably.
There are 40.4 million unpaid caregivers to older adults in the United States. What many people don’t know, however, is you can potentially get paid for your time and service if you’re caring for a loved one.
Getting paid to be a caregiver largely depends on your eligibility, state laws, and veteran status, among other factors. Below, I’ll discuss how to begin the process of getting paid to be a caretaker and receiving other aid and benefits for continued support.
Medicaid is the most common way family members can receive compensation or assistance for being caregivers. There are four types of programs within Medicaid that enable family members to receive payment for being caregivers.
These programs, however, may not be available to individuals in every state. States have varying care benefits under Medicaid programs, usually under a Medicaid State Plan. Ask your state’s Medicaid program for more information about eligibility and benefits for caring for a loved one.
Pro Tip: Are you ready to discuss care options with your loved one? Read my guide to in-home care that helps older adults age in place comfortably.
Nearly all states provide services through Home and Community-Based Services 1915(c). These Medicaid waivers are approved by the federal government, and they’re intended for aging seniors or individuals with disabilities who wish to receive long-term care and services at home or in their community.
These waivers help seniors live comfortably at home and provide a break for caregivers. They also give states the flexibility to offer coverage and benefits to select groups, such as individuals with disabilities.
According to the American Council on Aging, examples of common care include adult day care, respite care, and attendant care. Through the HCBS Waiver program, individual states can offer several services, such as case management, community transition services, utility reimbursement, personal care, respite care, and other support services for both caregivers and beneficiaries.
Individuals with traumatic brain injury, autism, epilepsy, or other diagnoses, for example, would be eligible for services depending on their individual state eligibility requirements and criteria. According to the Department of Health Care Services, “the services offered under the waiver must cost no more than the alternative institutional level of care.” People can receive these services as long as they are eligible and can prove the services are medically necessary.
FYI: Approximately 60 percent of caregivers believe seniors’ homes should be safer. Read our 2020 report Caregiving and Senior Safety Products to learn more.
The Medicaid Caregiver Child Exemption helps Medicaid beneficiaries transfer their home to an adult child as long as they don’t violate Medicaid’s five-year “look-back period” for transferring assets. This exemption allows seniors to transfer assets, such as their home, to an adult child without racking up a Medicaid penalty, provided the adult child is a caregiver who meets certain criteria.
The exemption also lets adult children care for their parents at home instead of in a nursing home. Medicaid won’t pay for room and board, though — just service support. To qualify for the exemption, an adult child caregiver must prove they provide quality care for their parent by helping with personal care, bathing, medication management, and other support needs.
Another requirement is that the child caregiver must live in the same home two years before their parent enters a nursing home.
Adult foster care is care provided to older individuals or adults with developmental disabilities in a home setting instead of a nursing facility or assisted living. Adult foster care provides personalized, quality care such as cleaning, meal preparation, medication assistance, personal care, and shopping. Each state has its own rules regarding adult foster care eligibility.
According to the U.S. Department of Health and Human Services, adult foster care homes typically provide 24-hour assistance for individuals who are 18 years or older and not able to independently care for themselves in their homes. States may have different names for adult foster care. Florida, for example, provides adult foster care in the form of adult care homes, which are required to provide personal care services in a residential setting for up to five residents.
Medicaid personal care services are care services for older adults and individuals with disabilities and other eligible beneficiaries in a home setting. Individuals who receive Medicaid personal care services include people with chronic health conditions who require daily assistance.
According to the Centers for Medicare and Medicaid Services, some states provide personal care services to Medicaid beneficiaries at home or in communities. Beneficiaries can receive support from caregivers in the form of bathing, housework, meal preparation, transportation, and more. Eligibility is dependent on state regulations, and the program requires individuals to prove medical necessity.
Caregiving is an important task to undertake, but it can be costly. If you are a family member who wants to get paid for your service, then research your options before applying for benefits as a caregiver.
Programs and eligibility vary from state to state, so it’s important to figure out what benefits your state may provide. Some states may not provide comprehensive coverage, or eligibility may differ across home and community settings. It’s best to reach out to your state’s Medicaid or equivalent program to learn how to apply for benefits.
Before starting the process, it’s important to speak with your loved one and create a plan for the level of care needed on a daily basis. That may include bathing, medication maintenance, transportation, and other necessary assistance.
Pro Tip: Are you looking to begin caring for a loved one? Be sure to read my caregiving guide to find all the tools you’ll need.
Veterans are eligible for various programs, such as veteran-directed care and housebound benefits. Family caregivers play an important role in helping veterans with daily tasks, as well as their health and well-being. Family caregivers for veterans can also apply for Department of Veterans Affairs (VA) programs such as caregiver assistance and other comprehensive assistance programs.
Veteran-directed care at the VA is a program that gives all veterans a chance to receive essential home- and community-based services, including personal care services, other daily living assistance, and support from caregivers.
The program is intended for veterans who may live alone and need additional support from a caregiver who can provide quality care and daily assistance with everyday tasks such as shopping, using the bathroom, bathing, and dressing.
To qualify for veteran-directed care, veterans must be eligible for community care and meet criteria for personal care services, among other requirements. According to the VA, veterans who qualify for the veteran-directed care program are presented with a budget to help pay for essential services and continue living at home or independently in a community setting. If you’re a veteran who is debating between home or community care, read this guide from the VA for more information.
Aid and attendance benefits are monthly payments from the VA, in addition to a monthly VA pension for qualifying veterans. To be eligible for VA aid and attendance, veterans must currently receive a VA pension and meet at least one of these requirements:
To apply for aid and attendance benefits, individuals need to complete VA Form 21-2680 (Examination for Housebound Status or Permanent Need for Regular Aid and Attendance) and mail it in or apply in person at a regional VA office.
Housebound benefits are similar in process to aid and attendance benefits. Housebound benefits also provide monthly payments that are added to a monthly VA pension for housebound veterans who qualify and require daily assistance. If a veteran currently receives aid and attendance benefits, they can’t receive housebound benefits at the same time.
To qualify for housebound benefits through the VA, an individual must currently receive a VA pension and confirm they are housebound or spend a majority of time at their home due to a permanent disability. The application process for aid and attendance benefits also applies to housebound benefits, which means individuals need to complete VA Form 21-2680 or apply in person at a regional VA office.
The Program of Comprehensive Assistance for Family Caregivers (PCAFC) is a series of services for qualifying veterans who sustained a serious injury at work on or before May 7, 1975, or after September 11, 2001. The program is aimed at providing support in the form of a financial stipend, health insurance, and other resources for veterans and caregivers.
Along with sustaining a serious injury before 1975 or after 2001, veterans also need to adhere to additional eligibility criteria, according to the VA.
Nursing home diversion programs allow older adults and people with disabilities the freedom and flexibility of staying in their homes instead of relocating to a nursing home or assisted-living facility. According to the National Library of Medicine, several states are implementing more community-based services and giving nursing home residents a chance to return to the community.
The Nursing Home Transition and Diversion Waiver — the nursing home diversion program in Madison County, New York — operates with Medicaid funding. It offers services for individuals with disabilities and older adults as they transition into the community from a nursing facility or other institutional setting. The goal is to help individuals “divert” or choose a community-based program. Eligibility varies by state, but for Madison County, individuals need to be 65 years old or between ages 18 and 65 with a physical disability. They also need to have Medicaid coverage supporting community-based long-term care services, as well as meet other criteria.
FYI: Read my guide What Is a Nursing Home? to learn more about this type of care and see whether it’s right for you.
Life insurance is an important part of the financial planning process for both caregivers and their parents. If you are a caregiver to your parents or loved ones, you know you have a responsibility to care for and support them. If anything were to happen to you, though, it’s good to have a contingency plan.
When you’re looking into life insurance policies and plans, make sure to look closely at your finances to figure out what may happen to your loved one if you pass away. There are many types of life insurance plans that may fit your needs, such as long-term-care insurance for the person you’re caring for or paid family leave laws in the event you need to take extended time off to provide caregiving support.
Pro Tip: Are you prepared for when a loved one passes away? Read our article about the basics of estate planning, which helps individuals or family members choose what happens to their assets.
If you are an aging senior, you’re likely to require long-term care insurance and other forms of assistance to take care of yourself. Long-term-care insurance helps individuals who require long-term care and assistance with daily tasks at home or in a community setting. Long-term-care insurance is pricey, but it serves as an additional safety net since common health insurance plans may not cover long-term care.
Individuals who opt for long-term-care insurance may have a chronic illness, disability, or sustained injury that requires supervision and long-term care. They could also be nearing retirement. Medicare and many private insurance companies don’t cover long-term care, but you don’t need a Medicare plan to enroll in long-term care.
Several states provide paid family leave for individuals who need to take time off to care for an ill loved one. In New Jersey, for example, an individual can receive paid leave to care for a family member who has a serious health condition. The family member can be a spouse, sibling, grandchild, or anyone the individual has a close family relationship with.
The maximum period an individual can take off is six weeks for family leave and 26 weeks to care for their own disability, according to the National Partnership for Women and Families. Each state has its own paid family leave laws, so look into the type of benefit payments, longevity, and other criteria that need to be met.
According to the IRS, you can deduct certain caregiving expenses on your tax return. If you pay for some of your parents’ medical expenses, for example, you can itemize your deductions and claim your parents as dependents. You can fill out Schedule A Form 1040, Itemized Deductions, to deduct the medical expenses. The medical-expense deduction also has specific criteria.
If you take care of your parents at home and receive money from them to pay for household expenses, that money isn’t taxable.
Visit IRS.gov for filing information and other deductions.
The average caregiver salary is $27,461 per year, or $14.08 an hour, according to Talent.com. Many caregivers in the U.S., however, are unpaid and are estimated to provide approximately $470 billion worth of unpaid care each year. The average salary for paid family caregiving varies by state.
You play an important role as a caretaker by offering moral support and daily assistance to individuals in need. There are many options for getting paid or receiving overall support for caregiving, including aid and attendance benefits, the Program of Comprehensive Assistance for Family Caregivers, and other resources.
Before beginning the process of caring for a loved one or applying to get paid for your caregiving, it’s important to research your options, examine your financial situation, and discuss what your loved one needs to feel comfortable and cared for. The paperwork and hassle of applying for different programs and benefits can be overwhelming, but it can be rewarding to get paid while caring for a loved one.
Medicaid home- and community-based services waivers are the most common way to get paid to care for your parents, but each state offers its own specific programs.
In most cases, an adult child can get paid between $9 and $19.50 per hour to care for their elderly parents. The rates vary by state.
Almost every state provides some form of pay for family caregivers, and some states — including Arizona and California — will even pay for spouses to be caregivers.
According to the Congressional Budget Office, the average family caregiver was paid between $7,800 and $30,000 per year by the state.