Providing care for a friend or family member is a labor of love for the 40 million people who are coping with that challenge. But taking on caregiving responsibilities can be costly. A 2016 AARP survey found that unpaid caregivers spend an average of almost $7,000 a year on out-of-pocket expenses.

But for many people who leave a job to take on caregiving responsibilities, the cost is even higher. An earlier AARP study estimated that missed wages and Social Security benefits totaled $234,000 for male caregivers and $324,000 for women, who are more likely to drop out of the workforce.

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So it’s no surprise that many family members who devote significant time and money to caregiving wonder whether it’s possible to be compensated for their work. “The majority of people who contact us are asking precisely that,” says Sima Schoen, a resource specialist at the Family Caregiver Alliance, a nonprofit advocacy group in San Francisco.  

The answer is maybe, if you're persistent. “There are a handful of ways you may be able to get paid," says Schoen. "But programs and policies vary from state to state, and even in the best of circumstances, it can be difficult.”  

Here are five of the best routes for getting paid as a caregiver to a family member:

Medicaid

If the person requiring care is enrolled in Medicaid, family caregivers may be able to be paid through a so-called “waiver” program, which allows people to be cared for at home rather than in a hospital or nursing home.

Since Medicaid is administered by the states, program rules differ depending on where you live, as does the name the waiver goes by. (It is variously known as Self- or Consumer-Directed Care, or Cash and Counseling.)  

Under the waiver program, Medicaid recipients can choose their own home health aide, which can be a family member. (Spouses are excluded in some states; in others, the caregiver can't reside in the same home as the care recipient.)

The amount a family caregiver may receive depends on where you live. It's generally the hourly minimum wage in the state, which is $7.25 to $15 an hour.

Applying for the program can be time-consuming. The person needing care (or his or her representative) is required to create a written plan detailing exactly what kind of services will be provided, as well as an estimated budget.

This plan must be approved by the state Medicaid office, which can take time. Many states have long lists of people waiting to become eligible for the waiver, Schoen warns, because limited funding usually restricts the number of openings in the programs. To learn more, contact your state Medicaid office.

Another option: Some states have similar programs that are not part of Medicaid but are aimed at helping lower-income individuals. To see whether that’s a possibility for your family, contact your local Area Agency on Aging.

Veterans Services

The Veterans Administration (VA) offers a program in most states, called Veterans Directed Care, for vets who require “nursing home level care” but would prefer to get that care in their own home. People who have health coverage through the VA may be eligible for a stipend, which they can use to pay for services they need, including personal caregivers of their choosing.

But rules about family members are stringent, and a high level of documentation is required. There also may be long waiting lists for these programs. The amount of the stipend is determined by the number of hours of care needed and the typical hourly wage of a home health aid, somewhere around $10. The best source of information is your state’s Veterans Administration office.

Long-Term Insurance

Check with your family member to see whether he or she has long-term-care insurance. This private coverage can help pay for an assisted living facility or a nursing home, as well as services in your own home.

Depending on the specific insurance, a policyholder may be able to use a portion of the benefit to hire a family member. Call your long-term-care insurer to find out the details of the coverage. But Schoen warns it can be difficult to arrange because many insurers require aides to be employed by a licensed agency. 

Paid Caregiver Leave

A small but growing number of companies have begun offering paid caregiving leave as a way to recruit and retain their workforce, according to Alex Guerrero, a director at the American Elder Care Research Organization in Reno, Nev. So if you have short-term caregiving responsibilities, ask your employer whether this option available.

Some states are starting to offer caregiver benefits. Hawaii recently became the first one to pay a stipend to caregivers, as much as $70 a day. To qualify, you must work least 30 hours a week helping an elderly family member at home.

Additionally, a handful of states—California, Rhode Island, New Jersey, and (as of Jan. 1, 2018) New York—and the District of Columbia require certain employers (small businesses are generally exempt) to offer some level of paid leave for various family situations, including caring for an ailing family member.  

Workplace or state leave policies generally allow employees to take from 4 to 12 weeks for caregiving duties and to be paid all or part of their salary while still receiving benefits. Guerrero notes that the time doesn’t need to be used consecutively. So be strategic about your leaves. For example, you might split caregiving responsibilities with others, which will enable you to stretch out your paid absence by taking off only a couple of days a week.

Family Contracts

If someone in the family has financial resources—perhaps your parents who need care or a sibling or group of siblings—consider working out a deal. They might prefer to pay a family member instead of an outside health aide.

“It can be a good option, but it’s fraught with pitfalls so you need to approach it very carefully,” says Schoen. She notes that old family conflicts often resurface over the care of a parent, so the more formalized the arrangement is, the better.

That means drawing up a “personal care agreement” that spells out details of the plan. It should include a description of the type of care to be provided, the number of hours a week the caregiver will work, and how and how much he or she will be paid. (The compensation shouldn't be more than what you would pay to hire an outsider, Schoen says.)

Ideally, the agreement should be drafted (or at least reviewed) by an elder-care attorney. If you can afford to pay, find one through the National Academy of Elder Law Attorneys. If you have limited means, call your local Area Agency on Aging to ask about pro bono legal services.  

You can also draft an agreement yourself; you can find sample contracts here. Whether you do it yourself or work with an attorney, the document should be dated and signed by all involved parties in the presence of a notary.

Aside from helping avoid family disputes, a formal legal agreement can prevent problems if the care recipient later applies for Medicaid. To determine eligibility, a person’s assets and expenses are subject to a “look back period” of up to five years. A care agreement will show that payments to a family member were a legitimate expense, not an attempt to reduce assets by gifting money to a family member.