California guide
How to Pay for In-Home Care in California
Californians usually pay for in-home care by combining several sources. These include In-Home Supportive Services (IHSS), Medi-Cal programs, Medicare for short-term skilled care, VA benefits for eligible veterans, long-term care insurance, family savings, and sometimes home equity. Which sources fit depends on income, assets, care needs and whether the person owns a home.
Perhaps a parent has started needing help with bathing or meals. Perhaps you are the one who wants to stay in the house you have lived in for decades, and the question has become how to pay for the help that makes that possible. The house may be worth a great deal while the monthly budget feels tight. This guide walks through each way of paying, one at a time, so the choices feel less tangled.
What Are the Main Ways to Pay for In-Home Care?
It is completely normal not to know these options yet. Few families learn about them until care is suddenly needed.
Here is the full landscape, in no particular order:
- IHSS. A California program that can pay a caregiver to help an eligible person at home.
- Medi-Cal. California's Medicaid program, which has other home-care pathways beyond IHSS.
- Medicare. Federal health insurance that covers some skilled care at home, for limited periods.
- VA benefits. Programs for eligible veterans and some surviving spouses.
- Long-term care insurance. A private policy bought in advance.
- Out-of-pocket and family funds. Savings, pensions, and help from relatives.
- Home equity. The share of the home's value that is not owed on a loan.
The National Institute on Aging notes that "an important part of planning is thinking about how you are going to pay for the help you need" and that "home-based services can be expensive." It adds that they may cost less than moving into assisted living or a nursing home. It lists personal funds and private financing, including long-term care insurance and reverse mortgages, among the ways people pay. A broader overview of paying for in-home care follows the same categories.
In-Home Supportive Services (IHSS): California's Largest Public Program
IHSS is a California program that pays a caregiver to help an eligible person stay safely at home. That caregiver can be a family member. The program is run by the California Department of Social Services (CDSS) through county welfare departments. It is funded jointly by the state and federal government through Medi-Cal.
Eligibility generally turns on three things. The person must be 65 or older, or blind or disabled. They must meet Medi-Cal's income and asset rules. They must also live at home rather than in a facility. The county decides whether each condition is met.
IHSS can cover several kinds of help:
- Personal care. Bathing, dressing and grooming.
- Domestic services. Cleaning, laundry and meal preparation.
- Paramedical services. Health-related tasks a licensed professional directs, done at home.
- Protective supervision. Watching over a person who could be at risk of harm if left alone.
A county social worker visits and assesses needs, and the number of authorized hours depends on that person's situation. IHSS pays the caregiver directly. The person receiving care is the employer of record, which means they hire and direct the caregiver. Applications go through the county IHSS office or the county social services department.
If income and assets are limited, IHSS may cover a meaningful share of the help a person needs at home.
Medi-Cal and Long-Term Care: What the State Covers Beyond IHSS
Medi-Cal is California's version of the federal Medicaid program. The California Department of Health Care Services (DHCS) runs it, and it can pay for care at home through more than one route.
- Home- and Community-Based Alternatives (HCBA) waiver. This program helps people who would otherwise need nursing-facility care to stay at home.
- Multipurpose Senior Services Program (MSSP). This waiver provides care management and supportive services to help frail seniors remain at home. It is administered through the California Department of Aging.
- CalAIM Community Supports. These services are sometimes called In Lieu of Services. They are a newer Medi-Cal managed care option that may cover home-based services as an alternative to higher-cost care settings.
Medi-Cal has income and asset rules. A primary home is generally not counted as an asset for eligibility. DHCS publishes the current limits.
California also runs a Medi-Cal estate recovery program. Through it, after a Medi-Cal member dies, the state may seek repayment for certain services from the member's probate estate, generally when the member was 55 or older when the services were received or lived in a nursing facility. It does not claim when there is a surviving spouse or registered domestic partner, a surviving child under 21, or a surviving child who is blind or disabled, and it must waive its claim in some hardship cases (Welfare and Institutions Code section 14009.5). How that applies depends on each family's circumstances.
What Medicare Actually Covers — and Where It Stops
Families are often surprised by what Medicare leaves out. Medicare is the federal health insurance program for people 65 and older and for certain people with disabilities.
The key idea is the difference between two kinds of care:
- Skilled care is medical work done by trained staff, such as nursing, physical therapy or speech therapy.
- Custodial care is everyday help with bathing, dressing or making meals.
Medicare generally covers skilled home health care when a doctor orders it and a Medicare-certified agency provides it. That coverage lasts only for a limited period tied to a medical need. Medicare generally does not cover custodial care when that is the only care a person needs.
Medicare Advantage plans, also called Part C, may offer some extra home-support benefits. Those benefits vary by plan. Medicare.gov publishes current coverage details.
Separately, Medicare Savings Programs can help people with limited income and resources pay Medicare costs. Medicare.gov says the income and resource limits go up each year and that the programs are run by the states. People apply through their state.
VA Benefits for Veterans Who Need In-Home Care
For a veteran, or the surviving spouse of one, VA programs may help pay for care at home.
- Aid and Attendance. This pension benefit adds monthly income for eligible veterans and surviving spouses who need help with daily activities. It is income-based. It also requires either a VA rating or an age qualification.
- Homemaker and Home Health Aide Program. This program provides in-home care to eligible veterans through VA-contracted agencies.
- Community Care. Some veterans may receive in-home care through VA-authorized community providers.
Each program has its own rules, and VA.gov publishes the eligibility details. A local VA medical center or a county Veterans Service Office in California can help with an application.
VA benefits and Medi-Cal or IHSS can sometimes be used together. How they combine depends on the person's facts.
When the Home Has Value: Using Home Equity for Care
A family may find there is real value in the house even when the bank account is thin. That equity can be a resource, but each way of reaching it trades something. These options are described in no particular order.
- Home equity line of credit (HELOC). This is a line of credit secured by the home. The borrower draws money as needed and makes monthly payments. Qualifying requires income, and the borrower must repay what is drawn.
- Cash-out refinance. This replaces the current mortgage with a larger one, and the borrower takes the difference in cash. It also requires income to qualify and brings monthly payments.
- Reverse mortgage (HECM). HUD describes the Home Equity Conversion Mortgage (HECM) as the only reverse mortgage insured by the federal government. It is available only through FHA-approved lenders. The CFPB explains that it is for homeowners 62 and older and that borrowers do not make monthly mortgage payments. Interest and fees are added to the balance each month, so the amount owed grows over time. The borrower must live in the home as a principal residence, pay property taxes and homeowners insurance, and keep the house in good condition. A HECM must be paid off when the last surviving borrower or eligible non-borrowing spouse dies or no longer lives in the home as a principal residence. That includes after a sale or a move. The CFPB also notes that a reverse mortgage is an expensive way to cover short-term needs if a health issue may cause a move soon.
- Selling or downsizing. This frees the equity entirely, but it means leaving the home.
A reverse mortgage is one option among several. It is not the answer for every situation. More on home equity for long-term care and California home equity options is available on this site.
Money from a loan or a sale can interact with Medi-Cal asset rules, which is worth understanding before anything is signed.
Other Resources: Long-Term Care Insurance, Family Contributions, and Area Agency on Aging
Some help comes from outside government programs, and some comes from local offices that tie everything together.
Long-term care insurance is a private policy bought in advance. It pays a daily or monthly benefit when the holder has qualifying care needs. Policies vary widely in what they cover. What a policy pays depends on its own terms.
Family contributions can take many forms, such as shared costs, time, or a room in the house. Under IHSS, a family member can be the paid caregiver if the person receiving care qualifies.
Area Agencies on Aging are local agencies funded through the California Department of Aging. Every California county has one. They connect older adults and caregivers to local services, benefits counseling and care coordination.
HICAP, the Health Insurance Counseling and Advocacy Program, is a free California program. It offers unbiased counseling on Medicare and other benefits.
Because several programs overlap, a benefits counselor or social worker can help identify which ones a person qualifies for, how to combine them, and how home ownership, estate recovery or loan proceeds may affect eligibility. Ideas for staying in your home may also help with planning.
Your next step
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Frequently asked questions
Does the state of California pay for elderly in-home care?
Yes, for people who qualify. IHSS is the state's largest in-home care program. Medi-Cal waivers such as HCBA and MSSP offer other pathways. Eligibility depends on income, assets and care needs.
Who is eligible for In-Home Supportive Services (IHSS) in California?
IHSS generally serves people who are 65 or older, or blind or disabled. They must also meet Medi-Cal's income and asset rules and live at home rather than in a facility. A county social worker then assesses needs to set the authorized hours. The county IHSS office handles applications.
Does Medicare pay for in-home personal care in California?
Generally not, when personal care is the only need. Medicare covers skilled home health care, such as nursing or therapy, for a limited period tied to a medical need. Custodial help with bathing, dressing or meals is a different category. Medicare.gov publishes current details.
Can a family member be paid to provide in-home care in California?
Under IHSS, yes, if the person receiving care qualifies. The recipient acts as the employer of record, and IHSS pays the caregiver directly. CDSS and the county set the rules on which family members can serve.
Can a homeowner use their home equity to pay for in-home care?
Yes. The options include a HELOC, a cash-out refinance, a reverse mortgage, or selling. Each trades something, such as monthly payments, a growing loan balance, or leaving the home. The home equity section above covers the reverse mortgage requirements and repayment triggers.
Does owning a home affect Medi-Cal or IHSS eligibility in California?
A primary home is generally not counted as an asset for Medi-Cal eligibility, which IHSS relies on. Medi-Cal estate recovery may still reach the estate after death. DHCS publishes the current limits. A benefits counselor can explain how these rules apply to one family.
What is the difference between IHSS and a home care agency in California?
IHSS is publicly funded. The person receiving care is the employer, and the program pays the caregiver directly. A private home care agency is a business that employs its own caregivers and bills the client or the client's insurer.
Related articles
Sources
- Home Equity Conversion Mortgages for Seniors — U.S. Department of Housing and Urban Development — U.S. Department of Housing and Urban Development
- What is a reverse mortgage? — Consumer Financial Protection Bureau — Consumer Financial Protection Bureau
- When do I have to pay back a reverse mortgage loan? — Consumer Financial Protection Bureau — Consumer Financial Protection Bureau
- Medicare Savings Programs — Medicare.gov — medicare.gov
- Aging in Place: Growing Older at Home — National Institute on Aging — nia.nih.gov
- DRE Urges California Seniors Watch for Targeted Real Estate and Property Scams — California Department of Real Estate — California Department of Real Estate
Published by the Golden Roof Equity editorial team
