Ways Families May Pay for In-Home Senior Care

Paying for in-home care is one of the biggest concerns families face. The good news is that several options may help, depending on your loved one's situation, insurance, and eligibility for government programs.

This article provides an overview of the main ways families pay for in-home care. It is general information, not financial or legal advice. For specific guidance, consult a financial advisor, elder law attorney, or benefits counselor.

Private Pay

Private pay means paying out of pocket. This is the most common way families pay for in-home care.

How It Works

• ✓You pay the care agency directly for the hours of care provided
• ✓You control the schedule and level of care
• ✓No eligibility requirements or approvals needed

Things to Know

• ✓Costs vary by level of care, schedule, and location
• ✓You can start with a few hours and increase as needed
• ✓Some families use savings, home equity, or family contributions to cover the cost

Long-Term Care (LTC)

Long-term care insurance is a policy that pays for long-term care services, including in-home care. If your loved one has a policy, it may cover some or all of the cost.

How It Works

• ✓The policy pays a daily or monthly benefit for covered care
• ✓The benefit amount and duration depend on the policy
• ✓Most policies require that the person need help with at least two activities of daily living (ADLs) or have cognitive impairment
• ✓The policy may require care to be provided by a licensed agency

Things to Check

• ✓Does the policy cover in-home care or only facility care?
• ✓What is the daily or monthly benefit amount?
• ✓Is there a waiting period (elimination period) before benefits start?
• ✓Does the policy require care from a licensed agency?
• ✓What is the process for filing a claim?

See our article on using long-term care insurance for home care for detailed guidance.

Medi-Cal and CalAIM

Medi-Cal is California's Medicaid program, which provides health coverage for people with limited income and resources. Several Medi-Cal programs may cover in-home care for eligible individuals.

In-Home Supportive Services (IHSS)

IHSS is a Medi-Cal program that pays for in-home care services for eligible individuals. It is designed to help people stay safely in their own homes rather than moving to a care facility.

CalAIM

The California Advancing and Innovating Medi-Cal (CalAIM) initiative includes programs that may cover in-home care services for eligible members. CalAIM Enhanced Care Management and In-Lieu of Services benefits may include in-home support.

Eligibility

Medi-Cal eligibility is based on income, assets, and medical need. The rules are complex and change over time. For current eligibility information, contact the California Department of Health Care Services (DHCS) or a Medi-Cal benefits counselor.

Things to Know

• ✓Eligibility and benefits vary by program and county
• ✓The application process can take time
• ✓Some programs require a specific level of care need
• ✓Not all care agencies accept Medi-Cal

See our CalAIM program page for more information about how Healthy at Home works with Medi-Cal and CalAIM programs.

VA Benefits

The U.S. Department of Veterans Affairs (VA) offers several programs that may help cover in-home care for Veterans and their surviving spouses.

VA Aid and Attendance

The Aid and Attendance benefit provides additional monthly payments to Veterans and surviving spouses who need help with daily activities. The benefit can be used to pay for in-home care.

Eligibility requirements include:

• ✓The Veteran served at least 90 days of active duty, with at least one day during a wartime period
• ✓The Veteran or surviving spouse needs help with daily activities or is bedridden
• ✓Income and net worth requirements must be met

VA Homemaker and Home Health Aide Care

The VA offers homemaker and home health aide services for eligible Veterans. This program provides in-home care services through VA-approved agencies.

Other VA Programs

• ✓Veteran-Directed Care: Allows Veterans to direct their own care, including hiring family members as caregivers
• ✓Respite Care: Provides short-term care to give family caregivers a break
• ✓Geriatrics and Extended Care: Various programs for aging Veterans

Things to Know

• ✓VA benefits do not guarantee coverage of all care costs
• ✓Eligibility varies by program
• ✓The application process can take time
• ✓Not all care agencies work with VA programs

See our Veterans program page and our article on home care options for Veterans for more.

Medicare

Medicare is the federal health insurance program for people 65 and older and some younger people with disabilities. It is important to understand what Medicare covers and what it does not.

What Medicare Covers

• ✓Short-term skilled care after a hospital stay (skilled nursing, physical therapy, occupational therapy)
• ✓Home health services ordered by a doctor, for a limited time
• ✓Medical supplies like wound care supplies

What Medicare Does Not Cover

• ✓Ongoing custodial care (help with bathing, dressing, toileting, meals) when that is the only care needed
• ✓24-hour care at home
• ✓Long-term in-home care
• ✓Companionship care

This is a critical distinction. Traditional Medicare generally does not pay for ongoing non-medical home care when that is the only care required. If your loved one needs help with daily activities but does not need skilled medical care, Medicare will not cover it.

See our article on Medicare and non-medical home care for a detailed explanation.

Other Options

Reverse Mortgages

A reverse mortgage allows homeowners 62 and older to convert home equity into cash. The funds can be used to pay for in-home care. This is a significant financial decision that should be discussed with a financial advisor.

Life Insurance Conversions

Some life insurance policies can be converted to pay for long-term care. Options include life settlements, viatical settlements, and accelerated death benefits. Consult a financial advisor for guidance.

Family Contributions

If one family member is the primary caregiver, other family members may contribute financially. This can help cover the cost of professional care that supplements family caregiving.

See our article on how siblings can share caregiving responsibility for strategies on sharing costs.

Putting It All Together

Most families use a combination of payment sources:

1. ✓Start with an assessment of what care is needed
2. ✓Check insurance: Does your loved one have long-term care insurance?
3. ✓Check benefits: Is your loved one eligible for Medi-Cal, VA benefits, or other programs?
4. ✓Check Medicare: Does your loved one qualify for short-term Medicare home health?
5. ✓Calculate the gap: What is left after insurance and benefits?
6. ✓Plan for the gap: Use private pay, family contributions, or other sources

A Final Note

Figuring out how to pay for care can feel overwhelming, but you do not have to do it alone. A care provider can help you understand what options are available and connect you with resources. A free care assessment is a good place to start.

If you would like help understanding your options, Healthy at Home offers a free care assessment. We can help you navigate payment options and connect you with the right resources. See our Programs We Offer page for more information about specific programs.