Financial Help for Caregivers You Probably Don’t Know About

The financial side of caregiving is one of the most stressful and least-discussed parts of the whole experience. Caregivers spend an average of $7,242 out of pocket per year (about 26% of their income) on care-related expenses (AARP, 2021). And that’s the average. For people caring for someone with dementia or complex medical needs, it’s often far more.

What most caregivers don’t know: there’s a substantial ecosystem of financial assistance programs out there. Some are federal. Some are state-specific. Some are local. Most people don’t find them until they’ve already been paying for years.

This guide is an overview of what exists.

When Margaret’s mother was discharged from the hospital after a hip fracture, the discharge social worker handed her a single pamphlet about Medicare. What the social worker didn’t mention: Margaret’s mother (a low-income homeowner in Ohio) was likely eligible for the state’s PASSPORT Medicaid waiver, which could have funded up to 56 hours of home care per week, personal care aides, and meal delivery. Margaret spent eight months paying $2,800 a month out of pocket for home care before a neighbor mentioned the program. She’d been eligible the whole time. That gap, between what exists and what anyone tells you about, is what this guide is for.

Federal Programs

Medicare

Medicare covers more than most people think, but it does NOT cover what most people actually need.

What Medicare covers:

• Hospital stays
• Doctor visits and outpatient care
• Short-term skilled nursing facility care (after a qualifying 3-day hospital stay, for up to 100 days)
• Home health care, if it’s medically necessary and ordered by a doctor, and includes skilled services like nursing or physical therapy
• Some preventive care (screenings, vaccines, wellness visits)
• Prescription drugs (through Part D)

What Medicare does NOT cover:

• Long-term custodial care: the day-to-day help with bathing, dressing, meals, and mobility that most caregivers actually provide
• Assisted living
• Most in-home personal care aides

This gap is where most families get surprised. Medicare pays for skilled, medically necessary care, not for someone to help your parent get dressed in the morning.

Medicaid

Medicaid is the primary public funder of long-term care in the United States. If your parent qualifies based on income and assets, it can cover:

• Nursing home care
• Home and community-based services (through Medicaid waivers)
• Personal care aides
• Adult day programs
• Respite care

The challenge: Medicaid eligibility requirements vary significantly by state, and asset limits mean many middle-class families don’t qualify until they’ve spent down most of their savings. Medicaid planning (with an elder law attorney) can be worth understanding before you need it.

Contact your state Medicaid office or local AAA for specifics on eligibility in your state.

VA Benefits for Veterans

If your parent is a veteran, the VA has financial benefits that many eligible veterans never claim:

Aid and Attendance: A VA pension benefit that provides additional monthly income to veterans (and surviving spouses) who need help with daily activities. The benefit can be substantial, up to $2,874/month for a veteran with a dependent (VA.gov, current rates). Many eligible veterans never claim it.

Caregiver Support Program: For caregivers of post-9/11 veterans, provides a monthly stipend, healthcare coverage, respite care, and other support.

Home Modification Grants: The HISA (Home Improvements and Structural Alterations) grant and SHA/SAH grants can fund home modifications like ramp installation and grab bars.

To find out what your parent might qualify for, contact the VA at 1-800-827-1000 or a Veterans Service Organization (VSO). They provide free help finding and applying for benefits.

State Programs

Home and Community-Based Services (HCBS) Waivers: Most states offer Medicaid waivers that fund services to help people stay at home rather than move to a facility. These are often the most significant source of financial help families don’t know exists. Services vary by state but typically include personal care aides, adult day programs, meal delivery, home modifications, and respite care.

What the generic guides don’t tell you: the program name, benefit levels, and eligibility rules vary enormously by state. Here’s what some major state programs actually provide:

• California (IHSS, In-Home Supportive Services): Covers personal care, domestic services, and some paramedical services. Eligible recipients can receive up to 283 hours/month of aide services, worth roughly $3,200+ per month in avoided costs. No waitlist in most counties; eligibility based on Medi-Cal and functional need. (California CDSS)
• New York (CDPAP, Consumer Directed Personal Assistance Program): Allows the person receiving care to hire and direct their own personal care worker, including family members in some cases. Covers up to 24 hours/day for the highest-need recipients. (New York State DOH)
• Ohio (PASSPORT Waiver): Funds up to 56 hours/week of personal care, plus meal delivery, transportation, and respite care. Managed through local Area Agencies on Aging. (Ohio Medicaid, PASSPORT Program Fact Sheet)
• Texas (STAR+PLUS Waiver): Covers personal care, respite care, home modifications, and adaptive aids. Benefit level set by individual functional assessment. (Texas HHSC)
• Illinois (Community Care Program, CCP): Home care aide services through the Illinois Department on Aging; no Medicaid requirement for some services. (Illinois Department on Aging)

Critical detail on waitlists: Most HCBS waiver programs have waiting lists, some running 1–3 years. KFF found over 710,000 people were on HCBS waiting lists nationally as of 2024. Contact your state Medicaid office or local Area Agency on Aging to get on the list now, even if you’re not sure you’ll need it.

State Caregiver Assistance Programs: Some states have their own caregiver support programs separate from federal Medicaid. Your local AAA knows what exists in your state.

State Pharmaceutical Assistance Programs (SPAPs): Many states offer extra help with medication costs for seniors who don’t qualify for federal assistance or need more than Medicare Part D provides.

Property Tax Exemptions and Deferrals: Many states offer property tax relief for elderly homeowners. Worth checking with your county assessor’s office.

Local Programs

Area Agency on Aging (AAA): Your local AAA coordinates local services, some of which include financial assistance or free/subsidized services. The Eldercare Locator (1-800-677-1116) connects you to yours.

Meals on Wheels and Home-Delivered Meals: Free or low-cost meal delivery through your local AAA or affiliated organization.

Transportation assistance: Many communities have low-cost or free medical transportation for seniors, through AAA programs, volunteer driver networks, or nonprofit organizations.

Utility assistance: LIHEAP (Low Income Home Energy Assistance Program) can help with heating and cooling costs. Your local AAA or 211 hotline can connect you.

Private Resources

Long-term care insurance: If your parent has an existing policy, review it carefully. Many people don’t know what triggers the benefits or don’t realize they’re eligible to claim. Call the insurance company and ask directly.

Life insurance: Some life insurance policies can be converted to pay for long-term care costs through “life settlements” or “accelerated death benefits.” Worth calling the insurance company to ask about options.

Reverse mortgage: For homeowning seniors, a reverse mortgage can provide income to fund care costs. This is complex and has significant tradeoffs. Get independent financial advice before pursuing it.

Finding Everything in One Place

For an overview of available programs in your area:

• Benefits.gov: search for federal benefits by category
• BenefitsCheckUp.org (NCOA): a free tool to find federal, state, and local benefit programs your parent may qualify for
• Your local AAA: they know the local landscape better than any website
• 211: the national social services helpline; dial 2-1-1 or visit 211.org

A Word on Elder Law Attorneys

If your parent has any significant assets, a consultation with an elder law attorney is worth the money. They specialize in Medicaid planning, estate planning, and protecting assets while qualifying for benefits. An hour of their time can often save far more than it costs. Make sure you also have the essential documents in place. An elder law attorney will need them.

Next step: Read our guide on Tax Breaks for Family Caregivers to find out what deductions and credits you might be eligible for.

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