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Getting Paid to Care for a Parent or Spouse: Medicaid Self-Directed Care, VA Programs and Caregiver Agreements

An older woman's hands holding a younger woman's hand against a bright white background, with a sticky note reading “3 programs?”.
Photo by Shamim Nakhaei on Unsplash

It usually gets settled at the kitchen table. A parent would rather pay a son or daughter than an agency, so the checks start. Years later, if that parent applies for Medicaid, a caseworker can go back through 60 months of accounts, and checks to family with nothing on paper behind them can read like gifts. What that paper says, and when it's signed, matters more than most families expect.

See what the written agreement needs

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By Margaret Linwood · Updated Oct 15, 2026 · Reviewed against KFF (2025 survey of state Medicaid home care programs, 2025 waiting list analysis), New York Department of Health, California LAO and CDSS, VA (38 CFR 71.40, pension rates), IRS (Publication 926, Medicaid waiver payments), N.J.A.C. 10:71-4.10, 42 U.S.C. 1396p

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Money can reach a family caregiver three ways. Medicaid programs in most states can pay a relative to give care at home. The VA pays some veterans' caregivers directly. And a parent can pay from her own savings, the one route that can start next week, as long as it's written the right way.

Spouses have a harder time than sons and daughters, since federal rules treat a husband or wife differently and many states follow suit. Medicaid also runs on waiting lists. For waivers serving older adults, the average wait ran 15 months in 2025.

See how caregiver pay gets taxed

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Questions to settle before anyone cuts back at work

Quitting a job before anything is approved is one of the costlier mistakes families make here. A few answers, most of them free from the local Area Agency on Aging, show which routes are even open.

  1. The local waiting list. Home care waivers have a capped number of slots, and about 607,000 people were waiting in 2025, by KFF's count. Ask how long the list runs in your parent's county, and get a name on it early.
  2. The rule for spouses. If a husband or wife would give the care, look up your state's rule for spouses on its own. Waivers in 44 states can pay a spouse, but only for care beyond what a husband or wife would ordinarily do.
  3. A veteran in the family. The VA's caregiver stipend starts with a disability rating of 70% or higher. Below that, ask a VA social worker about Veteran-Directed Care and Aid and Attendance.
  4. Your own health coverage. Price it before leaving a job, and ask each program whether it offers any. The VA stipend comes with CHAMPVA for primary caregivers who have no other plan.

Those answers narrow the field. What each route actually pays, and what a parent-to-child agreement needs on paper to hold up years later, is the longer story.

Compare the five routes side by side

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