Can a Family Member Get Paid to Be a Caregiver?

Millions of Americans provide unpaid care to aging parents, disabled spouses, and other relatives every year. Many caregivers reduce their work hours or leave jobs entirely to meet their loved one’s needs, creating serious financial strain. The good news is that several government programs, insurance options, and legal arrangements can help a family member get paid for the care they already provide, offering compensation for their caregiving efforts.

This guide explains exactly when and how you can become a paid caregiver for a relative. You will learn about Medicaid consumer-directed programs, Veterans Affairs benefits, state paid family leave laws, long-term care insurance policies, private personal care agreements, and direct payment options. Each pathway has different eligibility requirements, payment structures, and limitations that depend on where you live and your loved one’s situation.

Quick answer: When a family caregiver can and cannot be paid

Yes, you can often get paid to care for your mom, dad, spouse, or other relative. Payment is possible in many situations, but whether you qualify always depends on several factors: your loved one’s health needs and level of disability, their income and assets, your state of residence, and eligibility for specific programs like Medicaid or VA benefits.

The main ways a family member can receive payment for caregiving include Medicaid consumer-directed care programs, VA caregiver stipends and pension supplements, state paid family leave benefits, reimbursement through long-term care insurance policies, formal private personal care agreements funded by your loved one’s own resources, and other forms of financial support.

One important clarification: Medicare (original Medicare Parts A and B) almost never pays family caregivers for day-to-day personal care. Medicare covers skilled nursing and therapy services delivered by licensed professionals, but it does not reimburse relatives who help with bathing, dressing, or meal preparation. This is a common point of confusion for families exploring their options.

Here is a concrete example of how paid family caregiving works in practice. In 2025, an adult daughter in Ohio might be paid $15–$20 per hour through a Medicaid waiver program to help her father with bathing and meal preparation at home. The state would authorize a certain number of care hours per week based on his assessed needs, and she would submit timesheets to receive payment through a fiscal intermediary.

Keep in mind that eligibility rules, hourly rates, and which family relationships qualify vary significantly by state and program. Some states allow spouses to be paid; others do not. Some programs require the caregiver to pass a background check and complete training, while others have minimal requirements.

This article covers the following topics:

• Getting paid through Medicaid consumer-directed programs
• VA caregiver programs and pension supplements for veterans and their families (some of which provide a stipend as payment)
• Using state paid family leave for temporary wage replacement
• Long-term care insurance policies that may pay family members
• Setting up private personal care agreements
• Tax considerations and other financial supports for caregivers

Getting paid as a family caregiver through Medicaid

Medicaid is a joint federal and state health insurance program for people with limited income and assets. It covers many older adults age 65 and above, as well as people with disabilities of all ages. Unlike Medicare, Medicaid can pay for long-term personal care services at home, and in many states, that payment can go directly to a family member who serves as the caregiver.

As of 2024, most states run some form of consumer-directed or self-directed care Medicaid program. These programs allow the care recipient to choose who provides their care, often including a parent, adult child, sibling, or sometimes even a spouse. The caregiver is then hired and paid through the program, typically at an hourly rate set by the state or managed care plan.

To qualify, your loved one generally must meet three requirements. First, they need a documented medical need for help with activities of daily living such as bathing, dressing, eating, toileting, or transferring. Second, they must meet their state’s financial limits for Medicaid eligibility, which include both income and asset thresholds. Third, they must choose to receive care at home or in a community setting rather than in a nursing home.

These programs operate under various names depending on the state. You might hear terms like Home and Community Based Services waivers, waiver program, Cash and Counseling, Personal Care Services, Participant-Directed Services, or Consumer Directed Personal Assistance Program. California runs In-Home Supportive Services (IHSS), New York offers CDPAP, and Texas has the STAR+PLUS HCBA waiver. Despite the different names, the core concept is similar: eligible individuals can hire and direct their own caregivers, including relatives.

Pay rates for family caregivers in Medicaid programs typically range from $13 to $22 per hour in most states as of 2024, though some areas with higher costs of living pay more. The state or managed care organization sets the rate, not the family. Hours are limited to what the care plan authorizes based on assessed needs.

Not every family member can be paid through these programs. Some states exclude spouses from personal care programs, though they may allow them under specific waiver options. Others exclude parents who are legally responsible for minor children or legal guardians. The rules are state-specific, so you will need to verify which relationships are permitted where you live.

Steps to become a paid family caregiver through Medicaid

The process of becoming a paid caregiver through Medicaid involves several steps, starting with confirming your loved one’s eligibility and ending with your first paycheck.

The first step is to confirm whether your loved one is currently enrolled in Medicaid. If they are not enrolled, you will need to help them apply through the state Medicaid office or online portal. Each state has different income and asset limits, but for 2024, many states use thresholds around $2,829 per month in income for a single individual seeking home care services, with limited countable assets. These figures vary, so check your state’s current rules.

Next, contact your state Medicaid office or local Aging and Disability Resource Center and ask specifically about self-directed personal care or consumer-directed HCBS programs. Request information by name if possible. For example, ask about California’s In-Home Supportive Services, New York’s Consumer Directed Personal Assistance Program, or Texas STAR+PLUS HCBA waiver depending on your location.

Your loved one will then need to undergo a needs assessment. A nurse or social worker will visit to evaluate how much help they need with daily living and determine how many care hours per week the program will authorize. The resulting care plan will specify the 'authorized hours' of paid care per week that are approved for payment. This assessment is the basis for the care plan that governs payment.

Once approved, your loved one or their designated representative selects a caregiver. In consumer-directed programs, this can often be a family member. The caregiver then enrolls through a fiscal intermediary or home care agency that handles payroll, taxes, and compliance on behalf of the care recipient.

As the family caregiver, you will typically need to complete employment paperwork including W-4 and I-9 forms, consent to a background check, and in some states, complete basic training or orientation. Requirements vary by program.

After enrollment, you begin providing care and logging your hours. Most programs now use electronic visit verification apps or require submission of timesheets that document when care was provided. Payment is usually issued on a regular schedule, such as biweekly, based on approved and submitted hours.

Be aware that the entire process can take several weeks from initial application to first payment. Pay is generally not retroactive to the date you started caregiving, only to the date enrollment was officially approved.

Important Medicaid rules and limitations for families

Medicaid programs have strict rules about who can be paid, what tasks are covered, and how many hours the program will authorize. Understanding these rules helps you avoid problems and set realistic expectations.

Covered tasks typically include help with personal care like bathing, dressing, grooming, toileting, and transferring, as well as instrumental activities such as meal preparation, medication reminders, and grocery shopping. However, general household chores that benefit the whole family, rather than just the care recipient, are usually not covered.

Many states cap the number of hours per day or per month that can be paid, even if you provide more care than the authorized amount. For example, a state might approve 30 hours per week of paid care, but you might actually provide 50 hours. The extra 20 hours would be unpaid.

Spouse eligibility varies significantly. Some states do not allow spouses to be paid through standard personal care programs but may permit payment through specific waiver options. For instance, New York’s CDPAP generally allows family members including some spouses to be paid, while other states are more restrictive. Always verify the current policy in your state.

Receiving payment as a caregiver affects your taxes and potentially your eligibility for other benefits. Caregiver wages are generally considered taxable income. If you receive other means-tested benefits like SNAP or Medicaid yourself, the additional income could affect your eligibility. Keep detailed records of hours worked and payments received.

Families should contact their state Medicaid office or an Aging and Disability Resource Center for current program names, eligibility rules, and application procedures. The Medicaid.gov website provides contact information for each state’s Medicaid agency.

One critical warning: improperly structured informal payments between family members can cause serious problems later. If your loved one eventually applies for Medicaid coverage of nursing home care, the state will review asset transfers from the previous five years. Payments to family members without a formal care agreement in place may be treated as gifts, triggering a penalty period during which Medicaid will not pay for care. Formal arrangements through official programs or properly drafted personal care agreements are essential protection.

Getting paid as a family caregiver through Veterans Affairs (VA) benefits

The U.S. Department of Veterans Affairs offers multiple programs that can compensate or support family caregivers of eligible veterans. Some programs provide a direct monthly stipend paid to the caregiver. Others increase the veteran’s pension, which can then fund a private care arrangement with a relative.

The main VA options for paying family caregivers include the Program of Comprehensive Assistance for Family Caregivers (PCAFC), Veteran Directed Care, Aid and Attendance (A&A), and Housebound benefits. Each has separate eligibility rules tied to military service history, disability status, and level of care needed. Not all programs can be combined, and eligibility for one does not guarantee eligibility for another.

Here is an example of how these programs work. In 2024, a post-9/11 veteran with serious service-connected injuries could have their spouse designated as the primary caregiver (the official VA term for the main family member providing care) through PCAFC. The spouse would receive a monthly stipend calculated based on the veteran’s care needs and local wage rates for home health aides, plus access to health insurance coverage, mental health counseling, and respite care.

The payment structures differ across VA programs. PCAFC pays a stipend directly to the designated primary caregiver. Aid and Attendance and Housebound, on the other hand, are pension supplements paid to the veteran, who can then use those funds to compensate a family member through a personal care agreement.

Key VA programs that can help pay family caregivers

The Program of Comprehensive Assistance for Family Caregivers is designed for veterans who were seriously injured or became ill in the line of duty and now need personal care services. Benefits for the designated Primary Family Caregiver include a monthly caregiver stipend, access to CHAMPVA health insurance if not otherwise covered, mental health counseling, caregiver training, and at least 30 days of respite care per year.

To qualify for PCAFC, the veteran must be enrolled in VA health care, have a qualifying serious injury or illness, and need in-person personal care for at least six months. The caregiver must be at least 18 years old and can be a spouse, adult child, other relative, or even a close friend who lives with or plans to live with the veteran. The VA recently extended transition rules for legacy participants through September 30, 2028, maintaining eligibility and stipend amounts for many caregivers who were enrolled under earlier criteria.

Veteran Directed Care works similarly to Medicaid self-directed programs. Eligible veterans receive a flexible monthly budget that they manage to hire and pay caregivers, including family members, to help with daily activities at home. This program is available through partnerships between VA medical centers and Area Agencies on Aging, though it is not offered in all locations.

Aid and Attendance and Housebound benefits are additional monthly payments added to certain VA pensions. Veterans who need help with activities of daily living, are bedridden, or have limited sight may qualify for A&A. Those who are substantially confined to their home may qualify for Housebound. As of 2024, the maximum A&A pension for a single veteran can exceed $2,200 per month, with higher amounts for married veterans or those with dependents. These funds can be used to pay a family caregiver through a personal care agreement.

Surviving spouses of veterans may also qualify for Aid and Attendance or Housebound through the Survivor’s Pension program. While the surviving spouse receives the payment directly, they can use these funds to compensate a family member who provides their care.

Steps to become a paid family caregiver through the VA

Becoming a paid caregiver through VA programs requires the veteran and caregiver to work together, often with guidance from a VA Caregiver Support Coordinator or accredited benefits counselor.

For the Program of Comprehensive Assistance for Family Caregivers, start by reviewing eligibility requirements on VA.gov. If the veteran appears to qualify, the veteran and proposed caregiver jointly complete VA Form 10-10CG, which is the Application for the Program of Comprehensive Assistance for Family Caregivers. This form can be submitted online, by mail, or in person at a VA medical center.

After the application is submitted, VA staff conduct a clinical evaluation and may schedule a home assessment. The caregiver will complete required training. The entire process from application to decision typically takes several weeks to a few months. If approved, the caregiver begins receiving stipend payments and access to other program benefits.

For Aid and Attendance or Housebound benefits, veterans generally submit VA Form 21-2680 along with medical evidence documenting their care needs. Approval results in higher monthly pension payments that can fund caregiver compensation through a private arrangement.

For Veteran Directed Care, contact the local VA medical center or Area Agency on Aging to ask whether the program is available in your region. Enrollment procedures vary by location.

Caregivers seeking guidance can use several resources. The VA Caregiver Support Line is available Monday through Friday, 8 a.m. to 8 p.m. Eastern Time. Organizations like the Elizabeth Dole Foundation and American Legion also provide support for navigating VA caregiver benefits.

Using paid family leave to support caregiving

Paid family and medical leave refers to state laws and employer policies that provide wage replacement by replacing part of a worker’s wages when they take time off to care for a seriously ill family member. This is different from becoming a paid caregiver through Medicaid or VA programs. Instead, paid family leave provides temporary income replacement so you can step away from your job to provide care.

As of late 2024, 11 states plus Washington, D.C. have paid family leave or family and medical leave insurance programs either in effect or with start dates by 2026. These include California, New York, New Jersey, Rhode Island, Washington, Massachusetts, Connecticut, Oregon, Colorado, Maryland, Delaware, and the District of Columbia. Each state sets its own rules for eligibility, benefit amounts, and duration.

Paid family leave provides temporary support, not an ongoing wage for long-term caregiving. Benefits typically last between 4 and 12 weeks depending on the state. This option works best for caregivers who are currently employed and need to take time off after a new diagnosis, surgery, hospitalization, or sudden decline in their loved one’s condition.

Eligibility usually depends on your work history and earnings, not your care recipient’s income. You typically need to have worked a minimum number of hours or earned a minimum amount in the past year and have contributed to the state’s paid leave insurance system through payroll deductions.

Steps to become a paid caregiver through paid family leave

The first step is to determine whether your state has a paid family leave or family and medical leave insurance program. Check your state’s labor department website for current information. Also ask your employer whether they offer any additional paid caregiver leave beyond what state law requires.

To be eligible, you generally must have met minimum work hours or earnings requirements in the past year. You must also be caring for a qualifying family member, which typically includes parents, spouses, domestic partners, and children. Some states also cover grandparents, siblings, or other relatives.

The application process involves several steps. Notify your employer of your need for leave according to their policy requirements. Complete claim forms with the state paid family leave program. Obtain a certification from a health care provider documenting that your family member has a serious health condition requiring your care.

Understand that pay is partial, not full wage replacement. Most states provide 60 to 90 percent of your usual weekly wages up to a state cap. For example, New York provides up to 67 percent of the employee’s average weekly wage, with a maximum weekly benefit of around $1,068 as of 2024. Benefits are paid for a limited number of weeks per benefit year.

Coordinate paid family leave with the federal Family and Medical Leave Act if you are eligible. FMLA provides up to 12 weeks of job-protected unpaid leave for employees at larger companies. Using state paid leave during FMLA-protected time means you receive income while your job is protected.

Here is an illustrative example. An employee in New York takes 8 weeks of paid family leave at 67 percent of their average weekly wage to care for a parent recovering from a stroke. During this time, they receive partial wage replacement from the state while their job is protected under FMLA. After 8 weeks, they return to work while arranging other long-term care solutions.

Getting paid by long-term care insurance and private care agreements

Some older adults purchased private long-term care insurance policies that cover in-home assistance with activities of daily living. When these policies exist, benefits can sometimes be directed to a family caregiver rather than only to licensed agencies.

Only a small minority of Americans over 50 hold long-term care insurance policies. Most of these were purchased in the 1990s through 2010s before premiums increased significantly. However, when a policy exists, it can provide substantial daily or monthly benefits, often ranging from $150 to $250 per day, that may cover payment to a family member providing care. Payment from long-term care insurance is often made as reimbursement to the policyholder after care expenses are incurred and proper documentation is submitted.

Whether a family member can be paid under an LTCI policy depends entirely on the policy language. Some policies explicitly allow payment to informal or family caregivers. Others require that care be delivered by licensed home care agencies or certified aides only. You must review the specific policy terms.

Beyond insurance, families can create private personal care agreements where the loved one pays a family member directly for care at an agreed hourly or monthly rate. These agreements document the care arrangement, provide fair compensation to the caregiver, and create a paper trail that can be critical if the care recipient later applies for Medicaid.

Getting paid as a family caregiver through a long-term care insurance policy

Start by locating and carefully reviewing the long-term care insurance policy. Pay special attention to sections on informal caregivers, family caregivers, home care benefits, and provider qualifications. If you cannot find the policy document, contact the insurance company directly for a copy.

Most LTCI policies have benefit triggers that must be met before payments begin. Common triggers include the care recipient needing assistance with at least 2 out of 6 activities of daily living such as bathing, dressing, eating, toileting, transferring, or continence, or having a documented cognitive impairment like Alzheimer’s disease.

To open a claim, contact the insurer and follow their claims process. This typically involves submitting physician statements documenting the care recipient’s condition and needs. An assessment by a care coordinator may be required. Most policies have an elimination period of 60 to 90 days that must pass before benefits begin.

If the policy allows family caregivers, it will usually reimburse up to a daily or monthly maximum. The family caregiver may be paid at rates similar to what local home care agencies charge. Payment is often made directly to the policyholder, who then pays the caregiver.

Keep detailed care logs and invoices if you are being paid from LTCI benefits. The insurer may request documentation showing that services meet policy definitions and timeframes. Accurate records protect against claim denials.

Consider consulting a financial planner or elder law attorney to ensure LTCI benefits are used strategically. If future skilled nursing or assisted living facilities care is possible, you want to preserve benefits for those higher-cost settings while using other resources for current in home care needs.

Getting paid through a personal care agreement with your loved one

A personal care agreement is a written contract where a care recipient agrees to pay a family member for specified services at a reasonable hourly or monthly rate. This document formalizes what might otherwise be an informal family arrangement.

The agreement should be drafted before substantial payments begin. All parties should sign and date the document, and copies should be kept with other important financial and legal records. Waiting until after payments have been made can raise questions about whether the transfers were compensation or gifts.

Key elements to include in a personal care agreement:

The hourly rate should be consistent with what professional home care aides in your area charge, reflecting the local market rate. If the rate is significantly above market, Medicaid may view excess payments as disguised gifts, which could trigger a penalty period if the care recipient later applies for nursing home Medicaid.

An elder law attorney or estate planner familiar with Medicaid rules in your state can help ensure the contract is valid and compliant. This is especially important if there is any possibility the care recipient will need Medicaid-funded long term care in the future.

Remember that caregiving income is generally taxable. The family caregiver should plan to report payments on their tax return and may need to make estimated tax payments quarterly. Depending on how the arrangement is structured, the care recipient or caregiver may also owe payroll taxes.

Other financial supports and what to consider before accepting pay

Beyond the main pathways for getting paid, several other financial supports and practical considerations affect family caregivers.

Tax benefits may help offset caregiving costs. If you provide more than half of a parent’s support and they meet income requirements, you may be able to claim them as a dependent on your tax return. The Child and Dependent Care Credit can sometimes apply when paying for care that allows you to work. Some employers offer pre-tax dependent care flexible spending accounts. Several states offer additional tax credits for family caregivers, with some matching or exceeding federal credits.

Starting in 2024, Medicare reimburses certain health providers for structured caregiver training services. This does not pay the caregiver a wage, but it can provide free, high-quality instruction on how to safely assist with personal care, manage medications, and handle challenging behaviors.

Local resources can supplement paid caregiving or provide support during gaps. Area Agencies on Aging offer information and referrals to available services in your community. Many areas have sliding-scale adult day care programs that provide supervision and activities while giving caregivers a break. The Alzheimer’s Association and Family Caregiver Alliance offer support groups, individual counseling, and educational resources. Respite care grants may be available through the National Family Caregiver Support Program administered by local agencies.

Before accepting pay as a caregiver, consider the broader implications. Reducing your work hours to provide care affects your current income and future retirement savings. If you leave a job entirely, you may lose eligibility for unemployment benefits or employer-sponsored health coverage. Receiving caregiver wages could affect your eligibility for disability benefits or means-tested programs if your income increases above certain thresholds.

Emotional and relational considerations matter too. Being paid can help reduce financial stress and validate the important work you do. However, it can also shift family dynamics. Siblings who are not providing daily care may have opinions about the arrangement. Transparent communication with other relative caregivers and family members about roles, responsibilities, and compensation helps prevent misunderstandings and resentment.

Even if you are not currently paid, track your hours and tasks. This documentation can support future applications for paid caregiver programs, demonstrate the level of care provided if applying for VA or Medicaid benefits, and protect against disputes about whether care was actually delivered.

While not every family caregiver can receive payment, exploring Medicaid programs, VA benefits, paid family leave, long-term care insurance, and formal personal care agreements can significantly reduce the financial burden of caregiving. Many caregivers provide comprehensive assistance to their loved ones without knowing that government programs and other resources exist to help.

The most important first step is determining which programs your care recipient may be eligible for based on their health needs, income, assets, and veteran status. Contact your state Medicaid office, local Area Agency on Aging, or VA Caregiver Support Line to learn about available services in your area. If your loved one has a long-term care insurance policy, review it carefully or call the insurance company to understand what coverage exists. And if pursuing a private arrangement, consult an elder law attorney to ensure the agreement protects everyone involved.

Caregiving is demanding work. Getting paid for it, when possible, recognizes that reality and helps sustain your ability to provide care over the long term.