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Funding Home Care Services: Who Covers the Costs?

Shereen Thomas
January 31, 2024
6 min
Who Pays for Home Care Services?

When it comes to in-home care services, the question of who pays for them is an important one. The cost of in-home care can vary depending on several factors, including the type of care needed and the state regulations regarding caregiver responsibilities.

In-home care services typically refer to non-medical assistance with Activities of Daily Living (ADLs), such as bathing, dressing, meal preparation, and companionship.

Ways to Pay for In-Home Care

Depending on the individual's circumstances and needs, different funding sources may be tapped into, such as insurance, government programs, or out-of-pocket payments.

Veterans Programs

The Department of Veterans Affairs (VA) offers various programs that provide financial assistance to Veterans and their families for home care services. These programs aim to support Veterans with Activities of Daily Living (ADLs) and help them remain independent in their own homes.

The VA offers various home care programs with two popular options being the Aid & Attendance benefit and the VA Community Care Network's services, including Homemaker, Home Health Aide (HHA), and Respite services.

The Aid and Attendance benefit is available to Veterans who require the assistance of another person to perform everyday tasks. This program offers additional financial benefits to eligible Veterans and their spouses, helping them pay for home care services.

The Community Care Network (CCN) consists of various community healthcare providers, including hospitals, clinics, and individual practitioners that have partnered with the VA to deliver care to Veterans, as the VA does not directly offer HHA/Homemaker or Respite services.

The VA works with CCN providers to ensure healthcare services are easily accessible for Veterans who cannot travel to VA medical facilities or those that need specialized care that isn't offered at VA facilities.


Medicaid is a federal program that provides health coverage to low-income seniors, children, parents, people with disabilities, and more, making it an option for covering the costs of in-home care services. However, coverage for home care services under Medicaid can vary from state to state.

In some states, Medicaid offers programs specifically designed to help individuals receive care in their own homes. One such program is Programs of All-Inclusive Care for the Elderly (PACE), which provides comprehensive medical and social services to eligible individuals to support their independent living.

To be eligible for Medicaid coverage of in-home care services, individuals typically need to meet certain requirements. These requirements can include being under a physician's care and having a medical condition that qualifies them for home care. Additionally, individuals may need to be homebound, meaning they have difficulty leaving their home without assistance.

It is important to check with your state's Medicaid program to understand the specific coverage options and eligibility requirements available in your area.

Home and Community-Based Services (HCBS) Waivers

Home and Community-Based Services (HCBS) Waivers, also called Medicaid Waivers or 1915(c) Waivers, are programs funded by Medicaid that provide Long-Term Services and Supports (LTSS) for individuals who would otherwise require nursing home care. These waiver programs allow individuals to receive the care they need in their own homes and communities.

To qualify for an HCBS (Home and Community-Based Services) waiver, individuals must exhibit a significant need for care that, under different circumstances, would render them eligible for care within an institutional environment.

Managed Care Organizations

Managed Care Organizations (MCOs) play a crucial role in paying for in-home care services. MCOs are entities that contract with the government or private insurance companies to manage healthcare services for specific populations. They work by establishing networks of healthcare providers and coordinating and paying for care.

The eligibility requirements for these programs vary, but they generally target low-income individuals, older adults, and individuals with chronic conditions or disabilities.

Private Pay

Private pay is another option for seniors to cover the cost of in-home care services. This option involves individuals and their families directly hiring and paying for these services out of pocket, using their own income and savings. Private pay allows individuals to have more control over their care and choose the specific services and providers that best meet their needs.

While it might require some financial planning and budgeting, this option offers a way for individuals to access the services they need without relying on other forms of assistance or insurance coverage.

Choosing the Right Funding Path for In-Home Care

Choosing how to pay for care depends on your personal situation, whether you meet the criteria, and how much control you want over your care choices. It's essential to explore these options carefully to ensure that individuals receive the necessary care while managing the associated costs effectively.  

Government programs each have specific home care billing procedures that providers need to abide by. If you would like assistance with your home care billing schedule a call with us here or fill out the form below. To learn more about home care billing software read our article: How To Choose The Best Home Care Billing Software

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