Home health care can cost anywhere from $20 to $35 per hour depending on where you live and the level of care needed, which adds up to $3,000 or more per month if you need daily help. The good news is that several programs, insurance types, and financial strategies can cover part or all of that cost. Most people end up combining two or more of these sources to make home care affordable.
What Medicare Covers (and What It Doesn’t)
Medicare pays 100% of covered home health services with no copay, making it the first place to look. But the program is designed for short-term, medically necessary care, not ongoing daily assistance. To qualify, you must be considered “homebound,” meaning leaving your home is a major effort due to illness or injury and typically requires a cane, wheelchair, walker, or help from another person. A healthcare provider must assess you face-to-face and certify that you need skilled care before services begin, and the care must come from a Medicare-certified home health agency.
Covered services include skilled nursing care like wound care, injections, IV therapy, and monitoring of serious or unstable health conditions. Physical therapy, occupational therapy, and speech therapy also qualify. A home health aide can help with bathing and personal care, but only if you’re already receiving one of those skilled services at the same time.
The key limitation is hours. Medicare generally covers up to 8 hours per day of combined skilled nursing and aide services, with a maximum of 28 hours per week. In some cases your provider can authorize up to 35 hours per week for a short period. If you need more than part-time or intermittent skilled care, you won’t qualify for Medicare home health benefits at all. And Medicare does not cover homemaker services like cooking, cleaning, or shopping when those are the only services you need.
Medicaid and Home Care Waivers
For people with low income and limited assets, Medicaid is the most comprehensive payer for long-term home care. Every state runs its own Medicaid program with different income thresholds and covered services, but most states offer some form of home health benefit under their standard plan.
The real opportunity is through Home and Community-Based Services (HCBS) waivers. These are special Medicaid programs that provide an alternative to nursing facility placement. They can cover personal care attendants, homemaker services, adult day care, home modifications, and more. To qualify, you typically need to meet your state’s financial eligibility rules and require a nursing-home level of care, even though you’ll be receiving services at home. Each state runs its own waiver programs with its own names and waiting lists. Contact your state’s Medicaid office or Area Agency on Aging to find out which waivers are available and how to apply.
One important consideration: Medicaid has strict asset limits, often around $2,000 for an individual. If your savings exceed the threshold, you may need to “spend down” assets on allowable expenses before you qualify. An elder law attorney can help you navigate these rules legally and protect assets like your home or retirement funds where possible.
Long-Term Care Insurance
If you purchased a long-term care insurance policy before needing care, it can be one of the most flexible payment sources. These policies typically cover home health aides, skilled nursing visits, and personal care services in your home. Most policies begin paying benefits when you need help with two or more of six basic activities of daily living (bathing, dressing, eating, transferring, toileting, and continence) or when you have a cognitive impairment like dementia.
Benefits are usually paid as a daily or monthly maximum, and policies have a set benefit period (commonly 2 to 5 years). Most also include an elimination period of 30 to 90 days that works like a deductible: you pay out of pocket for that initial stretch before the policy kicks in. Review your policy documents carefully, because coverage details vary significantly between insurers and plan types.
Medicare Advantage Supplemental Benefits
If you’re enrolled in a Medicare Advantage plan rather than original Medicare, your plan may offer supplemental home-related benefits beyond what traditional Medicare provides. Nearly all Medicare Advantage plans now include extras like dental, vision, and hearing coverage, and about 70% offer meal delivery benefits. However, in-home support services are far less common. Only about 7% of enrollees in standard Medicare Advantage plans have access to in-home support benefits.
Your odds improve with Special Needs Plans (SNPs), which serve people who are dually eligible for Medicare and Medicaid, live in institutions, or have specific chronic conditions. About 11% of SNP enrollees have access to in-home support. Since 2020, Medicare Advantage plans have also been allowed to offer Special Supplemental Benefits for the Chronically Ill, which can include non-medical services like home-delivered meals, transportation, and personal care for qualifying enrollees. Check your plan’s evidence of coverage document or call the plan directly to find out what’s included.
VA Benefits for Veterans
Veterans who served during wartime and have limited income may qualify for the VA’s Aid and Attendance pension benefit, which provides a monthly cash payment specifically to help cover the cost of in-home care. The benefit is available to veterans and surviving spouses who need regular help with daily activities or are housebound. The monthly amount varies based on whether the recipient is a veteran, a veteran with a spouse, or a surviving spouse, and the VA adjusts rates annually for inflation.
Beyond Aid and Attendance, the VA also offers direct home health services through its own healthcare system, including skilled nursing, home health aides, and homemaker services for enrolled veterans. Some VA medical centers also run programs that pay a family caregiver a monthly stipend. Contact your local VA medical center or a Veterans Service Organization to explore which programs fit your situation.
The PACE Program
The Program of All-Inclusive Care for the Elderly (PACE) is a lesser-known option that bundles medical care, home care, and social services into one program. To enroll, you must be 55 or older, live in the service area of a PACE organization, be eligible for nursing home care based on your state’s criteria, and be able to live safely in the community at the time of enrollment. PACE covers virtually everything: doctor visits, prescriptions, home care, adult day programs, transportation, and more.
If you qualify for both Medicare and Medicaid, PACE typically costs you nothing out of pocket. If you have Medicare but not Medicaid, you’ll pay a monthly premium for the Medicaid-covered portion. PACE is not available everywhere, so check whether a PACE organization operates in your area through Medicare’s website or your state Medicaid office.
Using Home Equity
If you’re 62 or older and own your home, a Home Equity Conversion Mortgage (HECM), the FHA’s reverse mortgage program, lets you convert a portion of your home equity into cash without selling your home or making monthly mortgage payments. You can receive the money as a lump sum, a line of credit, or monthly payments, and use it for any purpose including home care costs. The amount you can borrow depends on the age of the youngest borrower (or eligible non-borrowing spouse), the home’s appraised value, and current interest rates.
A reverse mortgage makes the most sense when you plan to stay in your home long-term and have significant equity but limited monthly income. The loan doesn’t need to be repaid until you sell the home, move out permanently, or pass away. HUD requires you to meet with an approved housing counselor before taking out a HECM, which is a useful safeguard for understanding the trade-offs.
Tax Deductions for Home Care Costs
If you’re paying for home care out of pocket, some of those costs may be tax-deductible as medical expenses. You can deduct the portion of qualifying medical and dental expenses that exceeds 7.5% of your adjusted gross income. Qualifying home care expenses include wages paid for nursing services (even if the caregiver isn’t a licensed nurse, as long as the services are the kind a nurse would perform), such as giving medication, changing dressings, bathing, and grooming. Qualified long-term care services prescribed by a licensed health care practitioner also count.
Home modifications made for medical purposes are deductible too. This includes installing entrance ramps, widening doorways, adding grab bars in bathrooms, installing stairway lifts, lowering kitchen cabinets, and modifying electrical outlets or fire alarms for accessibility. Keep detailed records and receipts for all expenses, and work with a tax professional to make sure you’re capturing everything you’re entitled to.
Paying Out of Pocket
Many families end up covering at least some home care costs themselves, especially for non-medical help like companionship, light housekeeping, or meal preparation that insurance programs don’t cover. Home health aide rates vary by region but commonly fall in the $17 to $30 per hour range. At 20 hours per week, that works out to roughly $1,400 to $2,400 per month.
A few strategies can reduce the out-of-pocket burden. Hiring an independent caregiver rather than going through an agency typically costs less, though you take on employer responsibilities like payroll taxes and liability. Some states offer consumer-directed care programs through Medicaid that let you hire a family member as a paid caregiver. Sharing care responsibilities among family members and supplementing with paid help for specific tasks can also stretch your budget further. Even a few hours of professional care per week, focused on the tasks that are hardest for family members to manage, can make a meaningful difference while keeping costs manageable.