How to Pay for Home Care in the United States: A Comprehensive Guide for Families

The terms home care and home health care are often used interchangeably. For payment purposes, they are different.

Non-medical home care

Non-medical home care helps a person remain safe and independent at home. Services may include:

• Bathing, dressing, grooming, and toileting
• Walking, transferring, and fall-prevention assistance
• Meal preparation and feeding
• Medication reminders
• Light housekeeping and laundry
• Shopping and errands
• Transportation and appointment assistance
• Companionship
• Dementia supervision
• Respite for an unpaid caregiver

Many of these tasks fall into two categories. Activities of daily living, or ADLs, include bathing, dressing, toileting, transferring, continence care, and eating. Instrumental activities of daily living, or IADLs, include meal preparation, shopping, housework, managing medications, using transportation, and handling finances or communications. (ACL)

Home health care

Home health care is medical or therapeutic care delivered in the home. It may include:

• Skilled nursing
• Wound care
• Injections or intravenous therapy
• Physical therapy
• Occupational therapy
• Speech-language pathology
• Monitoring an unstable medical condition
• Teaching a family caregiver how to perform healthcare tasks

A person may need both types of care. For example, Medicare might cover intermittent nursing and physical therapy after a hospitalization, while the family privately pays for daily help with bathing, meals, and supervision.

Determining which tasks are medical, which are personal, and which can be handled through community programs is the first step toward finding the right payment source.

One of the most common misunderstandings about paying for home care is the belief that Medicare will cover ongoing personal assistance.

Original Medicare generally does not pay for long-term custodial care, including ongoing help with bathing, dressing, toileting, meals, transportation, or supervision when those are the only services the person needs. (Medicare)

When Medicare covers home health care

Medicare may cover home health services when all applicable requirements are met. In general:

• The person must need part-time or intermittent skilled nursing or qualifying therapy.
• The person must be considered homebound under Medicare's rules.
• A physician or other authorized healthcare provider must assess the person and order the care.
• A Medicare-certified home health agency must provide the services.
• The care must be included in an approved plan of care.

Covered services may include:

• Part-time or intermittent skilled nursing
• Physical therapy
• Occupational therapy
• Speech-language pathology
• Medical social services
• Medical supplies
• Certain durable medical equipment
• Part-time or intermittent home health aide assistance when the patient is also receiving qualifying skilled services

Medicare does not cover home health aide care when personal care is the only service needed. It also does not pay for 24-hour care at home, routine meal delivery, or homemaker services unrelated to a covered medical plan of care. (Medicare)

A qualifying beneficiary generally pays nothing for Medicare-covered home health visits. The Part B deductible and 20% coinsurance generally apply to covered durable medical equipment. (Medicare)

Medicare Advantage

Medicare Advantage plans must cover Medicare-covered home health services. Some plans may offer additional benefits or care-management services that Original Medicare does not provide.

Extra benefits vary by:

• Plan
• County
• Year
• Medical eligibility
• Provider network
• Prior-authorization rules

Families should review the plan's current Evidence of Coverage and ask the plan to confirm benefits in writing. An advertisement describing "in-home support" does not necessarily mean the plan will pay for an ongoing private-duty caregiver.

Medigap

Medigap policies help pay deductibles, coinsurance, and copayments associated with services covered by Original Medicare. They generally do not cover long-term care or private-duty nursing. (Medicare)

Medicare caregiver training

Medicare Part B may cover caregiver training when a healthcare provider determines that the training is necessary for the patient's treatment plan.

Training may address:

• Safe transfers
• Medication assistance
• Wound care
• Prevention of pressure injuries and infections
• Helping with daily tasks
• Communication techniques
• Management of a medical condition

The caregiver may receive individual or group training, sometimes without the patient present. After the Part B deductible, the beneficiary generally pays 20% of the Medicare-approved amount. This benefit does not pay the caregiver's wages, but it can help family caregivers provide safer care. (Medicare)

The Medicare GUIDE Model for Dementia Care

The Guiding an Improved Dementia Experience Model, known as GUIDE, is a Medicare program for qualifying people with dementia and the family members or other unpaid caregivers who support them.

The voluntary model began July 1, 2024, and is scheduled to operate for eight years. Participating organizations provide coordinated dementia care intended to reduce fragmented services and help people with dementia remain in their homes and communities. (Centers for Medicare & Medicaid Services)

GUIDE services may include:

• A comprehensive assessment
• An individualized care plan
• A designated care navigator
• Coordination among healthcare and community providers
• A 24-hour support line
• Caregiver education and skills training
• Support groups
• Individual caregiver support
• Screening for food, transportation, housing, and other social needs
• Referrals to community services
• Respite care for qualifying participants

GUIDE respite benefits

CMS reimburses GUIDE participants for up to a base annual cap of $2,500 per eligible patient, adjusted for inflation, for services that temporarily relieve an unpaid caregiver.

Respite may be provided:

• In the person's home
• Through an adult day center
• In an eligible short-term respite facility

GUIDE participants may not charge aligned patients cost-sharing for GUIDE care-management or respite services. CMS pays the participating dementia-care organization, which arranges or contracts for the approved respite. The benefit is not an unrestricted cash payment to the family. (Centers for Medicare & Medicaid Services)

The respite benefit can help a caregiver attend appointments, rest, work, travel, or handle other responsibilities. Because the benefit is limited, it should generally be treated as one component of a larger dementia-care plan rather than a replacement for ongoing home care.

Who may qualify for GUIDE?

A person generally must:

• Have dementia confirmed by a clinician associated with the GUIDE participant
• Be enrolled in Medicare Parts A and B
• Have Medicare as the primary payer
• Not be enrolled in Medicare Advantage or PACE
• Live in a private residence or certain approved residential care communities
• Not be a long-term nursing-home resident
• Not live in a memory care unit
• Not have elected the Medicare hospice benefit
• Not already be aligned with another GUIDE participant

Enrollment is voluntary, and CMS confirms eligibility after the patient or caregiver consents to participate. (Centers for Medicare & Medicaid Services)

Beginning July 1, 2026, a GUIDE participant must have a CMS-approved partnership arrangement with a residential care community before serving residents there. Residents of qualifying assisted living, group home, adult family home, or similar settings may receive many GUIDE services, but they are not eligible for GUIDE-funded respite. As of July 2026, residents of designated memory care units are not eligible for the model. (Centers for Medicare & Medicaid Services)

GUIDE is a nationwide Medicare model, but it is not available through every doctor or in every ZIP code. Families can review CMS's current participant list or call 1-800-MEDICARE to ask whether a participating dementia-care organization serves their area.

Eligible veterans may have several sources of home-care support. The programs serve different purposes, and qualifying for one does not automatically qualify a veteran for all of them.

VA home and community-based services may include:

• Homemaker and Home Health Aide Care
• Skilled Home Health Care
• Home-Based Primary Care
• Veteran-Directed Care
• Adult Day Health Care
• Respite care
• Telehealth
• Palliative care
• Hospice

Eligibility generally depends on clinical need, enrollment or eligibility for VA healthcare, service availability, and sometimes the veteran's service-connected disability status and financial circumstances. A copayment may apply. (Veterans Affairs)

VA Homemaker and Home Health Aide Care

This program may arrange for a trained aide to help an eligible veteran with daily activities. Assistance may include:

• Bathing
• Dressing
• Grooming
• Toileting
• Eating
• Mobility
• Grocery shopping
• Other approved personal-care tasks

The number of hours is based on an assessment and VA authorization. It is not automatically a full-time benefit.

VA Skilled Home Health Care

VA Skilled Home Health Care can help veterans who need clinical services following a hospital or nursing-home stay or who have continuing skilled needs.

Services may include:

• Skilled nursing
• Case management
• Physical therapy
• Occupational therapy
• Speech therapy
• Wound care
• Intravenous antibiotics

Skilled home health can sometimes be combined with other VA home and community-based services. (Veterans Affairs)

Veteran-Directed Care

Veteran-Directed Care allows qualifying veterans to exercise greater control over approved personal-care services. The veteran or representative works with a counselor to develop a spending plan and may be able to recruit, hire, and supervise workers.

Depending on local program rules, the worker may be a family member, friend, neighbor, or other caregiver. Availability varies by VA medical center and community. Veterans should ask a VA social worker whether the program is offered in their area. (Veterans Affairs)

VA respite care

VA respite may be provided:

• In the veteran's home
• At an adult day health center
• Through a short nursing-home stay

VA states that nursing-home respite is generally available for up to 30 days in a calendar year. A copayment may apply according to service-connected status and financial information. (Veterans Affairs)

Aid and Attendance

Aid and Attendance is an increased monthly VA pension payment for an eligible veteran or survivor. It is not a separate insurance plan or a direct home-care service.

A person who already qualifies for a VA pension may also qualify for Aid and Attendance when, for example:

• Another person is needed to help with bathing, feeding, or dressing.
• The person is largely confined to bed because of illness.
• The person resides in a nursing home because of a disability.
• The person meets VA visual-impairment criteria.

The additional pension income may be used toward home care or other expenses. (Veterans Affairs)

Families should use accredited assistance when applying and should be cautious of people who charge to submit an initial VA benefits claim or recommend questionable transfers designed to create artificial eligibility.

Program of Comprehensive Assistance for Family Caregivers

The VA's Program of Comprehensive Assistance for Family Caregivers may provide an eligible primary family caregiver with:

• A monthly stipend
• Caregiver education and training
• Mental health counseling
• Certain travel benefits
• CHAMPVA health coverage in some cases
• At least 30 days of respite per year

The veteran and caregiver must apply together and complete VA's assessment process. (Caregiver Support)

The VA Community Care Network

The VA Community Care Network, or CCN, connects VA with approved healthcare providers outside VA facilities.

CCN is not a separate insurance policy, cash benefit, caregiver stipend, or open reimbursement account. It is the contracted network VA uses to purchase authorized care from community providers when applicable requirements are met.

The network includes more than one million community providers and is divided into five regions. Optum manages Regions 1 through 3, and TriWest manages Regions 4 and 5. (U.S. Department of Veterans Affairs)

When a veteran may qualify for community care

The veteran generally must be enrolled in or eligible for VA healthcare and receive approval from the VA healthcare team before obtaining routine community care.

At least one additional circumstance usually applies, such as:

• VA does not provide the needed service.
• VA cannot provide care within designated wait-time or drive-time standards.
• Community care is in the veteran's best medical interest.
• VA cannot provide care meeting applicable quality standards.
• The veteran lives in an area without a full-service VA medical facility.
• The veteran qualifies under certain grandfathered distance rules.

VA's current access standards generally use a 30-minute average drive time or 20-day wait for primary care, mental health, and extended outpatient services, and a 60-minute drive time or 28-day wait for specialty care. (Veterans Affairs)

Can CCN be used for care at home?

VA may authorize community providers to deliver services such as:

• Home health care
• Skilled nursing
• Rehabilitation
• Hospice
• Certain extended-care services
• Other medically necessary care included in a VA referral

VA's community-care guidance lists home health, rehabilitation, nursing-home care, and certain other services among the types of care that may be provided through approved community providers. (U.S. Department of Veterans Affairs)

CCN should not be confused with Veteran-Directed Care. Veteran-Directed Care is a self-directed personal-care program. CCN is the network and payment mechanism VA uses to arrange authorized community services.

Prior authorization is essential

Except for qualifying urgent or emergency care, the veteran must generally obtain VA authorization before receiving care from a community provider.

The authorization letter identifies:

• The approved provider
• The authorized service
• The authorization number
• The number of visits or approved period
• The circumstances in which a new referral is required

VA does not ordinarily cover services that fall outside the authorization. If additional visits, procedures, or time are needed, the provider must request further approval. (Veterans Affairs)

A family should not independently hire a home care or home health agency, pay the bill, and assume VA will reimburse it later.

The best starting point is the veteran's VA primary care team, geriatric team, social worker, or caregiver-support coordinator. Ask for an assessment of all relevant programs rather than requesting CCN alone.

Some life insurance policies include a long-term care rider or chronic-illness rider. Others are combination products designed to provide:

• Long-term care benefits during the insured person's lifetime
• A death benefit if care is not needed
• A reduced death benefit after long-term care benefits are used

An existing policy may also offer:

• An accelerated death benefit
• Cash-value withdrawals
• A policy loan
• A life settlement
• A viatical settlement for someone who is terminally ill

These options can create money for care, but they may reduce or eliminate the amount ultimately paid to beneficiaries. Loans and withdrawals can also affect policy performance and may cause the policy to lapse.

Before changing, borrowing against, or selling a policy, request a written illustration showing:

• The amount available
• Fees and interest
• Effect on the death benefit
• Tax treatment
• Effect on Medicaid eligibility
• Effect on estate planning
• What happens if the policy lapses

ACL identifies personal funds, life insurance, annuities, reverse mortgages, and long-term care insurance among the private resources families may combine to fund long-term care. (ACL)

Area Agencies on Aging, commonly called AAAs, coordinate local services for older adults and caregivers. An AAA may be a county office, regional council, nonprofit organization, city agency, or council of governments.

AAAs do not usually provide unlimited free home care. They may, however, arrange, fund, or refer people to services that reduce the number of privately paid caregiving hours required.

Depending on local funding and eligibility, services may include:

• Homemaker assistance
• Personal care
• Home-delivered meals
• Congregate meals
• Transportation
• Adult day services
• Respite
• Caregiver education
• Benefits counseling
• Legal assistance
• Home-safety programs
• Senior centers
• Energy and housing assistance
• Long-term-care options counseling

AAAs serve geographic planning and service areas that may include a city, one county, or multiple counties. (ACL)

The federal Eldercare Locator connects families with their local AAA and other aging services. It can be reached at 1-800-677-1116. (ACL)

National Family Caregiver Support Program

The National Family Caregiver Support Program funds state and local services for unpaid caregivers.

Available support may include:

• Information about services
• Help accessing benefits
• Individual counseling
• Support groups
• Caregiver training
• Respite
• Limited supplemental services

Availability, eligibility, and the amount of assistance vary locally. (ACL)

State Health Insurance Assistance Programs

Every state and several territories have a State Health Insurance Assistance Program, or SHIP. These programs provide free, objective Medicare counseling to beneficiaries, families, and caregivers.

A SHIP counselor can help compare:

• Original Medicare and Medicare Advantage
• Medicare home health coverage
• Medigap
• Prescription drug plans
• Medicare Savings Programs
• Medicaid coordination
• Extra Help
• Coverage notices and appeals

A SHIP may have a different local name, such as SHINE, HICAP, VICAP, or SHICK. (SHIAP)

For homeowners, home equity may be a source of care funding.

Options include:

• Selling the home
• Downsizing
• Renting part of the property
• A home equity loan
• A home equity line of credit
• A family loan secured by the property
• A reverse mortgage

Reverse mortgages

A Home Equity Conversion Mortgage, or HECM, is the most common federally insured reverse mortgage. It is generally available to homeowners age 62 and older who meet applicable requirements.

Unlike a traditional mortgage, the borrower does not make regular monthly principal-and-interest payments. Interest and fees are added to the balance, causing the loan balance to grow and home equity to decline.

The homeowner must generally:

• Continue living in the home as the principal residence
• Pay property taxes
• Maintain homeowners insurance
• Keep the home in acceptable condition
• Satisfy other loan obligations

The loan typically becomes due when the borrower dies, sells the home, or no longer occupies it as a principal residence. A move to a healthcare facility lasting more than 12 consecutive months can also cause the loan to become due, subject to protections that may apply to an eligible co-borrower or non-borrowing spouse. (Consumer Financial Protection Bureau)

A reverse mortgage is a loan, not free money. Before proceeding, families should:

• Compare multiple lenders.
• Obtain HUD-approved counseling.
• Review fees and interest.
• Understand the effect on heirs.
• Consider whether a spouse can remain in the home.
• Evaluate less expensive alternatives.
• Avoid contractors or salespeople who pressure the homeowner to borrow.

Tax benefits rarely pay the entire cost of home care, but they may reduce the net cost.

Medical-expense deduction

Qualified long-term care services may be treated as medical expenses when they are:

• Required by a chronically ill individual
• Provided under a plan of care prescribed by a licensed healthcare practitioner

For this purpose, a person may be considered chronically ill when a licensed practitioner certifies that the person cannot perform at least two ADLs without substantial assistance for at least 90 days or requires substantial supervision because of severe cognitive impairment.

Eligible unreimbursed expenses may be included with other medical expenses on Schedule A. Only the portion of total qualifying medical expenses exceeding 7.5% of adjusted gross income is deductible.

Ordinary housekeeping or companionship is not automatically a medical expense. When a caregiver performs both qualifying personal or nursing care and ordinary household work, records should separate the services and costs. (IRS)

Useful documentation includes:

• A written care plan
• Medical certification
• Caregiver invoices
• Timesheets
• Proof of payment
• Descriptions of services
• Insurance reimbursement statements
• A breakdown of medical and non-medical tasks

Health Savings Accounts

HSA funds can generally be withdrawn tax-free for qualified medical expenses that have not been reimbursed elsewhere.

Depending on the circumstances, qualified expenses may include:

• Qualified long-term care services
• Certain nursing services
• Medical equipment
• Limited qualified long-term care insurance premiums

A person may continue using money already in an HSA for qualified expenses after becoming ineligible to make new contributions. The same expense cannot be reimbursed tax-free from an HSA and also claimed as an itemized medical deduction. (IRS)

Child and Dependent Care Credit

An employed taxpayer may qualify for the Child and Dependent Care Credit when paying for care for:

• A spouse who is physically or mentally incapable of self-care, or
• A qualifying dependent who is incapable of self-care

The expense must generally allow the taxpayer — and spouse, when applicable — to work or look for work. The person receiving care must meet residency and dependency-related requirements.

An expense cannot be used both for the dependent-care credit and as a medical deduction. (IRS)

Tax rules depend on the family's facts and the type of service. A qualified tax professional should review significant home-care expenses.

For many families, the most sustainable plan combines several forms of support.

Example: Home care after hospitalization. A person returns home after surgery. Medicare covers qualifying nursing and physical therapy. The family privately hires a caregiver for bathing, meals, and evening supervision. The local AAA arranges transportation and home-delivered meals.

Example: Dementia care. A person with Original Medicare enrolls with a participating GUIDE organization. GUIDE provides dementia-care navigation, caregiver education, 24-hour support, and limited respite. The family purchases additional caregiving hours beyond the respite allowance and uses an adult day program twice a week.

Example: Medicaid self-direction. A person qualifies for a Medicaid home and community-based waiver. Medicaid authorizes personal-care hours, and the state's self-directed program allows an adult child to serve as the paid worker. The family privately purchases occasional agency backup care.

Example: Veteran care. An eligible veteran receives authorized home health services from a CCN provider and personal assistance through a VA home and community-based program. The spouse receives caregiver training and respite support. Aid and Attendance pension income helps pay for uncovered hours.

Example: Long-term care insurance. A policy reimburses up to a specified daily amount after the elimination period. Retirement income pays the remaining agency bill, while a meal program and senior transportation reduce the number of caregiver hours required.

These are illustrations, not promises of eligibility. Each payer must approve its part of the plan.

Step 1: List the actual care needs. Document the tasks requiring assistance, when they occur, how long they take, and whether they require a caregiver, nurse, therapist, or other professional.

Step 2: Build a weekly schedule. Identify periods that require paid coverage and periods that can safely be handled by family, friends, adult day services, transportation programs, or meal delivery.

Step 3: Obtain comparable price quotes. Give each provider the same care description. Ask about minimum shifts, deposits, overtime, holidays, mileage, cancellation policies, and rate increases.

Step 4: Screen for public benefits. Contact:

• The state Medicaid agency
• The local Area Agency on Aging
• The Aging and Disability Resource Center
• The Eldercare Locator
• The local SHIP
• A VA social worker when applicable
• A PACE organization
• A GUIDE participant when dementia is involved

Step 5: Review existing insurance and benefits. Look for:

• Long-term care insurance
• Life insurance riders
• Employer or union benefits
• Annuities
• Veterans benefits
• Accident-related coverage
• Retiree benefits
• HSA balances

Step 6: Address legal and payroll issues. Use written contracts, proper payroll, powers of attorney, healthcare directives, and care agreements. Obtain elder-law or tax advice before transferring assets or creating a trust.

Step 7: Create an emergency backup plan. Identify who will provide care when:

• The regular caregiver is sick
• Severe weather prevents travel
• The care recipient's condition suddenly worsens
• A family caregiver becomes unavailable
• The agency cannot fill a shift

Step 8: Reassess the plan regularly. Review the plan after:

• A hospitalization
• A fall
• New wandering or behavioral symptoms
• Medication changes
• A change in mobility
• Caregiver burnout
• A major financial change
• A benefit approval or denial