Medicaid is the primary funder of long-term services and supports (LTSS) in the United States. It provides those services and supports either through institutional care (i.e., nursing home care) or home- and community-based services (HCBS). This report explains that one cost-effective HCBS option with multiple advantages is to pay family members to provide care for older people and adults with physical disabilities.
Pandemic Phenomenon: Long-Term Care Concerns Magnified
The COVID-19 outbreak has intensified longstanding problems in long-term care. Nursing homes were among the first COVID-19 "hotspots" in the United States, with their residents' death rates far exceeding the general population. Meanwhile, the pandemic has only exacerbated nursing homes' challenges related to social isolation, and the physical and mental harms from isolation are well documented. The COVID-19 pandemic has also exacerbated the ongoing nationwide shortage of direct care workers and high turnover within the industry.
What Gets in the Way of Enabling a Promising Resource
In spite of the advantages of providing pay for family caregivers, the concept has met certain barriers. One of the most common restrictions states impose is that a person may not hire his or her spouse as a paid caregiver, with the rationale that caring for one another is a responsibility inherent in the spousal relationship. In a pandemic environment, of course, this restriction can force spousal caregivers to work outside the house and bring in an outside caregiver, both of which raise the risk of infection. Concerns about family members committing fraud by billing for hours not worked has also motivated restrictions even as fraud is, in fact, extremely rare.
Paying Family Caregivers Benefits Families and Taxpayers
Family caregiving already serves a critical role in mitigating the growing strain on the LTSS system, in part by expanding the caregiver pool. As Americans continue to live longer, family members are providing ever more complex care at home, often for longer periods of time. A family caregiver's responsibility to provide that high level of care can make it difficult or even impossible for them to maintain another job. Therefore, paid family caregiving answers multiple needs:
- The person who needs care can age at home, which is the preference for the vast majority of people who need LTSS.
- The family caregiver earns modest income, mitigating the impact of lost job hours.
- It is a lifeline to families who cannot otherwise afford to care for their family member.
- Costs are kept lower. One analysis found the average monthly cost for self-directed care was $1,774 in 2019, compared to $6,175 for a semi-private nursing home room.
- Costly institutionalization is delayed or avoided entirely.
When COVID-19 cases began mounting during the spring of 2020, state Medicaid agencies lifted some restrictions and allowed more family members to be hired and paid as caregivers. States should now consider implementing permanent policies that encourage and facilitate paid family caregiving, and invest in support services for caregivers. Current Medicaid reimbursement rates are not sufficient to attract enough direct care workers into the professional home care workforce, and COVID-19-related budget shortfalls and balanced budget requirements mean reimbursement rates will not be raised any time soon.
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