Table of Contents
According to a 2021 AARP survey, 77% of adults ages 50 and older are interested in aging in place—a number that has remained constant for over a decade[1]. However, aging in place often requires the help of a caregiver or care partner.
As more baby boomers enter their golden years, the need for caregivers and care partners continues to grow. In fact, about 48 million Americans provide unpaid care to an adult family member or friend, a number that has increased by 8 million between 2015 and 2020, according to the National Alliance for Caregiving and AARP’s Caregiving in the U.S. 2020 study[2].
Fulfilling the role of a caregiver or care partner can be rewarding, but there are crucial considerations to weigh before making the commitment. Read on to learn what being a caregiver entails, how to receive payment as a caregiver and the different avenues available for compensation.
What Is a Caregiver?
A caregiver is a person who helps people with short- or long-term limitations caused by illness, injury or disability with daily tasks. Caregivers may complete or assist with any or all of the following:
- Transportation to medical appointments
- Picking up and/or organizing medications
- Monitoring the person’s medical condition
- Communicating with health care professionals
- Helping the person stand up and/or get out of bed
- Helping the person dress, bathe and use the bathroom
- Grocery shopping and housekeeping
- Preparing and serving meals
- Helping the person eat
- Managing finances
A person can find caregivers through home care agencies or choose a family member, friend or guardian to provide care. Some government programs offer funding for family or friends of people with disabilities, although eligibility varies by state and personal circumstances.
New York University’s Hartford Institute for Geriatric Nursing provides a general assessment tool for people considering becoming a caregiver or care partner. It can help them determine whether they’re prepared to take on the various aspects of caregiving, including providing physical and emotional support, setting up in-home support services and dealing with the stresses of caregiving, before they commit to the role.
How to Get Paid for Serving as a Caregiver to a Family Member
“Receiving compensation for family caregiving through Medicaid and Veterans Affairs programs …requires some level of training and credentialing,” explains Max Mayblum, a certified senior advisor and the CEO of Givers, which helps caregivers manage their money, access savings and access government programs. “Other public compensation, such as tax credits or local support programs, may be accessed without licensure,” adds Mayblum.
State Medicaid Programs
Many states offer consumer-directed personal assistance programs (CDPAPs) through Medicaid. These programs allow recipients to have some control over their own in-home care by hiring relatives or friends as paid caregivers or care partners instead of being assigned a state-designated caregiver.
Each state has different requirements and rules for paid caregivers. In some cases, the caregiver must gain a credential for caregiving, such as home care aide or advanced home care aide, and become employed by a state organization typically called a consumer-directed program.
Requirements to qualify for compensation also vary by state. For example, in Washington state, paid providers are required to complete 75 hours of basic training and must become a certified home care aide within 200 days of their service start date. This professional credential is issued by the Washington State Department of Social and Health Services, which provides training on basic skills and population-specific skills needed to provide hands-on care.
“It’s basically for safety,” explains Tibi Botocan, owner of A1 Senior Care Advisors, a free senior living advisory and placement service in Bellevue, Washington. “[Classes provide education] on how to handle someone who’s unable to bear weight on their feet, someone who has mental impairments [and/or] physical impairments, [and more],” he says.
Visit your state’s Medicaid website for more information about the rules and requirements that apply to you.
Area Agency on Aging and Department of Aging Services
An area agency on aging (AAA) is a local agency designated by the state to address the needs of older adults at regional and local levels. AAAs coordinate and offer services that help older adults who wish to remain in their homes, such as homemaker assistance, and other services designed to promote aging in place. Most states maintain multiple AAAs.
The specific name of each AAA varies from one jurisdiction to another, and many of their programs and services are federally supported and have inclusion/exclusion criteria often based on socioeconomic status. The Administration for Community Living’s Eldercare Locator tool can help identify local AAA or aging and disability resource centers.
Most states also have a Department of Aging Services or a Division of Aging Services. These organizations often work with local AAAs to connect older adults with relevant homecare services.
These agencies also offer support for caregivers and care partners, such as information about how to earn caregiving credentials and gain access to support groups for stress and burnout associated with caregiving.
AAAs also typically offer workshops and classes for caregivers and care givers, which vary by agency and location. One popular series, called “Powerful Tools for Caregivers,” helps educate attendees about caring for people with memory impairment, managing stress and making legal and financial decisions on someone else’s behalf.
Long-Term Care Insurance and Life Insurance
“Long-term care insurance and life insurance policies may be used to pay for a caregiver’s services, depending on the policy terms and coverage,” says Mayblum.
Some long-term care insurance policies reimburse policyholders for caregiver services they receive. When an individual initially purchases their policy, they can typically select a range of care options for coverage.
Additionally, if someone is in poor health or is already receiving long-term care services, they may not qualify for long-term care insurance or may only be able to buy a limited amount of coverage.
“Caregiver coverage isn’t always part of a long-term care insurance policy, so it’s important to review the specific policy documents and consult with an advisor from the insurance plan to understand the extent of coverage, any limitations and the process for filing claims,” says Mayblum.
Veterans Programs
Caregivers of veterans may be eligible to apply for compensation if both the caregiver and the veteran meet certain requirements.
The caregiver must be an adult who is a family member or live-in companion of the veteran requiring caregiving. Meanwhile, the veteran must have a VA disability rating (individual or combined) of at least 70%, have been discharged from the U.S. military or have a date of medical discharge, and need at least six months of continuous, in-person care services.
Visit the VA’s Program of Comprehensive Assistance for Family Caregivers webpage for more information and details on how to apply.
Tax Credits
According to the National Alliance for Caregiving and AARP’s Caregiving in the U.S. 2020 study, three-quarters of family caregivers surveyed reported spending an average of $7,242 annually on out-of-pocket costs related to caregiving[2].
Luckily, tax credits are available for caregivers who have incurred dependent care expenses. Take the IRS’ 10-minute quiz to help determine if a dependent qualifies you for a tax credit.
Average Pay for Family Caregivers
Statistics regarding the average pay of family caregivers are difficult to come by due to the wide range of ways they may be compensated and how that compensation is reported at the national level. However, one can consider the average salary of professional caregivers employed by home care agencies to better understand what level of payment is possible for caregiving services in general.
According to the Bureau of Labor Statistics, home health and personal care aides made an average of $30,930, or about $14.90 per hour, in 2018. The lower tenth percentile made about $10.80 per hour while the upper tenth percentile made about $18.45 per hour[3].
The top paying states for home health aides include Alaska, New York, North Dakota, Oregon and Washington. However, the benefits and amount of funding a caregiver receives depend on their unique situation and the situation of the person for whom they provide care.
It’s also important to note that becoming a caregiver or care partner could affect the amount of money you accumulate toward Social Security and/or the size of your Social Security checks if you’re already receiving your benefits.
If you’re of retirement age and considering becoming a caregiver, it’s possible to continue using your Social Security benefits and working at the same time, but the size of your Social Security checks may change depending on your employment type. For instance, household workers (including caregivers) can only earn Social Security credits for earnings of at least $2,600 per quarter. So if a caregiver earns an amount below this quarterly threshold, they may not earn additional credits toward their own Social Security benefits.
Should I Become a Caregiver?
Botocan reports that many family members are willing to step up to the plate to care for their loved ones as they age but underestimate the level of responsibility that comes with the role.
“I’ve seen people [for whom caregiving] has taken a toll on their health because… it’s exhausting to take care of someone, [especially] an elderly person or a sick person [and] especially if you have to do so throughout the day and night,” he says. “But many people do it out of feelings of responsibility and emotional [connection].”
Over one-third (36%) of family caregivers characterize their situation as highly stressful, according to a 2020 Caregiving in the U.S. report from AARP and the National Alliance for Caregiving[4]. It can be especially difficult when the person you’re caring for is your own spouse.
“It’s not an easy job to take care of someone,” says Botocan. “It’s a very hard job, and it’s a lot of responsibility.”
As a caregiver or care partner, it’s your responsibility to make sure the person you’re caring for is safe and comfortable and that their needs are met around the clock, which some well-intentioned family members don’t fully realize before taking on the role.
Becoming a caregiver or care partner is a noble undertaking and can be a source of great satisfaction and happiness, but if you’re considering fulfilling the role, be mindful of the potential for burnout and consider whether you have the time and energy to take care of your loved one in a full-time capacity. Try to be honest about what’s best for your loved one and your family in addition to your own well-being.
