Does Medicaid Pay for Home Care in Illinois?

22 Jul Does Medicaid Pay for Home Care in Illinois?

If an older parent or spouse needs help at home, one of the first questions is often:

Will Medicaid pay for a caregiver? In Illinois, the answer is sometimes.

Medicaid may help pay for certain services that allow an older adult to remain at home rather than move into a nursing facility. For older Illinois residents, this help is generally connected to the Community Care Program and the Illinois Persons Who Are Elderly waiver.

This does not mean Medicaid will pay for any caregiver, provide unlimited hours of care or cover every cost associated with remaining at home.

The person must meet the relevant eligibility requirements. Their needs must be assessed, and the services must be approved as part of a care plan.

This guide explains how Medicaid home care works in Illinois, what services may be available, where families often get confused—and where legal planning becomes critical.

Does Illinois Medicaid Cover In-Home Care?

Yes. Illinois Medicaid can cover certain home and community-based services for people who would otherwise be at risk of entering a nursing facility.

Illinois’ Community Care Program provides home and community-based services to qualifying adults age 60 and older. For participants who are eligible for Medicaid, these services may be funded through the Illinois Persons Who Are Elderly waiver. Some qualifying Community Care Program participants who are not enrolled in Medicaid may receive services funded by the State of Illinois.

The purpose of the program is to help eligible older adults remain in their homes or communities when they can be supported safely outside a nursing facility.

Medicaid does not simply provide families with an unrestricted home care budget.

The type and amount of help offered will depend on:

• The person’s age
• Their financial eligibility
• Their physical and personal care needs
• Their ability to remain safely at home
• The results of their care assessment
• The services approved in their care plan
• Whether home-based care is considered a suitable alternative to institutional care

A person may need significant help and still not qualify for every service the family would like.

What Is the Illinois Persons Who Are Elderly Waiver?

The Persons Who Are Elderly waiver is an Illinois Medicaid Home and Community-Based Services program.

It is intended for older adults who are at risk of nursing facility placement but may be able to continue living at home with appropriate support.

The program is administered by the Illinois Department of Healthcare and Family Services, with the Illinois Department on Aging responsible for its day-to-day operation.

The waiver is closely connected to the wider Community Care Program. 

Local Care Coordination Units assess care needs, determine eligibility for Community Care Program services and coordinate approved services. Medicaid financial eligibility is determined separately through the state’s medical-assistance process. For participants enrolled in Medicaid, the federal Persons Who Are Elderly waiver reimburses Illinois for part of the cost of approved services.

The word “waiver” can be confusing. It does not mean that Illinois simply waives all Medicaid eligibility rules.

It means the state has permission to use Medicaid funding for approved care and support services outside a nursing facility.

What In-Home Services Can Medicaid Cover in Illinois?

The services available will depend on the individual assessment and care plan.

Illinois lists several services under the Persons Who Are Elderly waiver.

In-Home Homemaker Services

A home care aide may help with household and personal care tasks that the older adult cannot safely complete alone.

These may include:

• Cleaning
• Preparing meals
• Laundry
• Grocery shopping
• Running essential errands
• Dressing
• Bathing
• Grooming
• Following a prescribed special diet

This is generally non-medical support. It should not be confused with continuous skilled nursing care in the home.

Adult Day Services

Adult day services provide care and supervision in a community setting.

They may offer structured activities, personal attention and support for a person’s social, physical and emotional well-being.

Adult day services can also give family caregivers a break during part of the day.

Emergency Home Response Services

An emergency home response system can provide a 24-hour communication link to assistance.

This may be appropriate for someone with documented health, safety or mobility concerns who needs a way to call for help.

Automated Medication Dispensers

An approved medication dispenser may help someone follow their medication schedule more safely.

The device does not replace medical oversight, but it may form part of a wider plan that helps the person remain at home.

Who May Qualify for Medicaid Home Care in Illinois?

For the Persons Who Are Elderly waiver, Illinois generally requires the person to:

• Be at least 60 years old
• Be an Illinois resident
• Be a United States citizen or an eligible non-citizen
• Be Medicaid eligible
• Be at risk of nursing facility placement
• Be able to remain safely at home or in a community setting with the approved services
• Have an estimated home-care cost that is lower than the estimated cost of institutional care

The person’s care needs are assessed through Illinois’ Determination of Need (DON) process.

To qualify for Community Care Program services, an applicant must generally score at least 29 points on the Determination of Need assessment, including at least 15 points on Total Impairment. Total Impairment includes Part A of the assessment and, where applicable, the Mini-Mental State Examination score.

Financial eligibility must also be met. For Community Care Program eligibility, non-exempt assets must generally be $17,500 or less. A home, car and personal furnishings are generally treated as exempt assets. Some applicants whose income exceeds the regular AABD Medicaid standard may still qualify through Medicaid spenddown, where allowable medical expenses are applied toward a monthly spenddown amount.

Age alone is not enough. A person does not automatically qualify because they are elderly, live alone or need occasional help around the home.

What Is a Determination of Need Assessment?

The Determination of Need assessment is used to evaluate the person’s functional needs.

A care coordinator may ask about the person’s ability to manage activities such as:

• Bathing
• Dressing
• Preparing food
• Shopping
• Housework
• Moving around safely
• Managing personal care
• Completing other everyday tasks

The assessment also considers the help the person already receives from family members, friends or paid caregivers.

After the assessment, the care coordinator can explain which services may be available and whether the person appears eligible for the relevant program.

Families should give an accurate picture of the person’s normal needs.

It may be tempting to focus on what the older adult can manage on a good day. The assessment should also reflect recurring problems, safety concerns and the help family members are already providing.

Does Medicaid Pay for 24-Hour Home Care?

Families should not assume that Medicaid will provide a caregiver in the home around the clock.

The Persons Who Are Elderly waiver provides specific approved services based on the person’s assessment and care plan.

It does not automatically provide:

• Continuous supervision
• A live-in caregiver
• Unlimited personal care hours
• Full-time nursing
• Overnight care
• Every service requested by the family

If the person cannot be left alone safely, the family may need to combine approved Medicaid services with unpaid family support, private care or another living arrangement.

In some cases, the level of care required may no longer be manageable safely at home.

Can Medicaid Pay a Family Member to Provide Care in Illinois?

Sometimes, but families should not assume that a relative will automatically be paid.

Under the Community Care Program (for individuals age 60 and older), care is typically delivered through an agency-based homemaker model. Approved agencies may hire certain family members if they meet training and background requirements.

However:

• Not all relatives are eligible
• The caregiver must usually be employed through an approved agency
• The care must be part of an authorized service plan

Under the Community Care Program, any family member, including a spouse, may potentially serve as a paid caregiver. A power of attorney, representative payee, legal guardian, friend or neighbour may also potentially qualify.

The person must meet the required qualifications, pass a background check, complete 24 hours of pre-service training, and be hired and supervised by an approved In-Home Services agency. Payment is not automatic, and the care must be authorized as part of the participant’s service plan.

Families should contact their local Care Coordination Unit and prospective provider agencies to confirm whether a suitable paid-caregiver arrangement is available.

This differs from other Illinois programs, such as the DHS Division of Rehabilitation Services Home Services Program (generally for individuals under age 60), which may allow more consumer-directed hiring.

A family member who has already been providing care without payment should not assume that Medicaid will reimburse them for past care.

Payments for personal care may be treated as transfers for less than fair market value unless a written agreement was executed before the services were provided and clearly identified the services and requested compensation at a rate consistent with prevailing local costs. Families should obtain advice before making informal or retrospective payments to relatives for care.

Families should speak with a care coordinator and, where appropriate, an elder law professional before making financial arrangements involving family caregivers.

What Is the Difference Between Home Care and Home Health Care?

These terms are often used as though they mean the same thing.

They do not always refer to the same type of service.

Home Care

Home care generally involves non-medical help with everyday activities.

This can include:

• Bathing
• Dressing
• Preparing meals
• Cleaning
• Shopping
• Supervision
• Other personal support

 

Home Health Care

Home health care generally involves skilled medical services provided at home.

These may include:

• Skilled nursing
• Physical therapy
• Occupational therapy
• Speech therapy
• Medical monitoring
• Wound care

Medicaid home and community-based programs can include personal support services. Medical home health services may be covered under a separate part of Medicaid or Medicare, depending on the person’s circumstances.

Families should ask exactly which service is being discussed rather than relying on the general phrase “home care.”

Does Medicare Pay for Home Care?

Medicare may cover certain skilled home health services when the person meets its coverage conditions.

It generally does not pay for long-term custodial care when personal assistance is the only care required.

Medicare says it does not usually cover:

• 24-hour care in the home
• Meal delivery
• Homemaker services that are not connected to an approved medical care plan
• Personal or custodial care when that is the only care needed

This is why families are often surprised after a hospital discharge.

A person may receive short-term Medicare-covered nursing or therapy at home but still need ongoing help with bathing, dressing, meals and supervision after the medical services end.

Medicaid, long-term care insurance, private payment and family caregiving may then become part of the discussion.

Is Home Care the Same as Assisted Living Medicaid?

No. Home care allows the person to continue living in their own residence.

Illinois’ Supportive Living Program provides services in approved residential settings that offer an assisted-living-style environment.

Under the Supportive Living Program, the resident lives in an approved facility and remains responsible for room and board.

Under the Persons Who Are Elderly waiver, the person receives approved services while living at home or in another eligible community setting.

A family deciding between home care and supportive living should consider:

• How much supervision the person needs
• Whether the home can be made safe
• Whether reliable caregivers are available
• The person’s mobility and memory
• The cost of private care that Medicaid will not cover
• Whether the person can be supported safely between caregiver visits
• The emotional and practical effect on family caregivers

The cheapest option on paper is not always the safest or most sustainable option.

Does Medicaid Home Care Affect the Five-Year Lookback?

It can. Illinois applies transfer rules when determining eligibility for certain long-term care services, including nursing facilities and Department on Aging home and community-based waiver services.

Transferring a house, giving money to children or moving assets shortly before applying can create eligibility problems.

Families sometimes assume the five-year lookback only applies when someone moves into a nursing home.

That is not a safe assumption.

Before transferring assets, changing ownership of a home or making large gifts, the family should understand how the decision may affect Medicaid eligibility.

Attempting do-it-yourself asset transfers—such as adding a child to a deed or gifting savings—can backfire. These actions may trigger penalty periods or create unintended tax and legal consequences.

Depending on the family’s circumstances and timing, Medicaid planning may involve a compliant spend-down, a properly documented personal-care agreement, or coordinated trust and estate planning.

An irrevocable trust is not an immediate solution to Medicaid eligibility. Assets placed in an irrevocable trust are generally subject to Medicaid transfer rules, and transfers made within the five-year lookback period may create a penalty. The legal, tax and financial consequences should be reviewed before a trust is funded.

Can Medicaid Recover the Cost of Home Care From the Estate?

Estate recovery may still need to be considered.

Illinois explains that Medicaid pays for services that help some people remain at home as well as services provided in long-term care facilities.

For certain Medicaid recipients, the state may seek repayment from the person’s estate after death.

There are exceptions, deferrals and limits on estate recovery. Recovery may be delayed or may not apply in certain circumstances involving a surviving spouse or a qualifying child.

For Medicaid recipients who die on or after July 1, 2022, Illinois does not allow recovery against the first $25,000 of estate value. Where the estate is worth more than $25,000, a Medicaid claim may potentially be satisfied from the value above that threshold, subject to surviving-spouse protections, qualifying-child protections, hardship rules and other legal limits.

Families should not assume that receiving care at home automatically avoids estate recovery.

The result may depend on:

• The Medicaid coverage involved
• The services received
• The person’s age
• How the home and other assets are owned
• Whether the property passes through the estate
• Whether an estate recovery exception applies

If the person owns a home, estate recovery should be considered as part of the wider Medicaid and estate plan.

[Read: Medicaid Estate Recovery in Illinois]

How Do You Apply for Medicaid Home Care in Illinois?

A practical starting point is to contact the Illinois Department on Aging’s Senior HelpLine.

The current number is: 1-800-252-8966

Families can also contact the local Care Coordination Unit serving their county.

A care coordinator can:

• Discuss the person’s current needs
• Arrange or explain the assessment process
• Review possible services
• Help identify local providers
• Explain the next application steps

If the person is already enrolled in an Illinois Medicaid managed care plan, the family should also contact the plan’s care coordinator.

What Information Should the Family Gather?

Before beginning the process, it can help to collect:

• Identification and proof of Illinois residency
• Medicaid and Medicare information
• Recent medical records
• A current medication list
• Details of recent falls, hospital visits or safety incidents
• A list of the daily tasks the person cannot complete alone
• The current caregiving schedule
• Income information
• Bank and investment statements
• Property information
• Long-term care insurance documents
• Powers of attorney
• Existing estate planning documents
• Details of any recent gifts or asset transfers

Updated property and healthcare powers of attorney can be especially helpful if an older adult later becomes unable to manage financial or care decisions independently.

The authority available to an agent depends on the wording of each document. An agent should not assume that a general power of attorney automatically permits gifts, asset transfers, beneficiary changes or other Medicaid-planning transactions.

Common Mistakes Families Make

Several misunderstandings come up repeatedly.

Assuming Medicare Will Cover Ongoing Personal Care

Medicare may cover skilled home health services, but it generally does not provide open-ended custodial care.

Waiting Until the Current Care Arrangement Breaks Down

Applications, assessments and provider arrangements take time.

Waiting until the caregiver is exhausted or the person is about to be discharged from hospital can leave the family with fewer choices.

Understating the Person’s Needs

The assessment should reflect the actual support required, including the unpaid help already being provided by family members.

Assuming Medicaid Will Cover Every Hour Needed

Approved services may only cover part of the care required.

The family still needs a realistic plan for evenings, overnight needs, emergencies and gaps between visits.

Transferring Assets Without Advice

A gift, deed change or transfer intended to help can create a Medicaid penalty or a wider estate planning problem.

Paying Family Caregivers Informally

Payments for a relative’s personal care may be treated as transfers for less than fair market value if there was no written agreement executed before the services were provided, or if the agreement did not clearly identify the services and compensation at a rate consistent with prevailing local costs.

Ignoring the Family Caregiver’s Limits

A plan that only works because one relative is constantly available may not be sustainable.

The family should consider what happens if that caregiver becomes ill, returns to work or can no longer manage the physical demands of care.

FAQ

Does Illinois Medicaid pay for a caregiver at home?

It may pay for approved in-home services when the person qualifies for the relevant Medicaid waiver or state program. The amount and type of care depend on the person’s assessment and approved care plan.

Does Medicaid pay for someone to stay with an elderly person all day?

Not automatically. Medicaid home care programs do not guarantee continuous or 24-hour supervision. The approved hours and services depend on the person’s assessed needs and program rules.

Can an elderly person qualify if they live with their family?

Possibly. Living with family does not automatically prevent eligibility. The assessment may consider what help family members already provide and which needs remain unmet.

Can a daughter or son be paid to care for a parent?

Some Illinois programs may permit payment to certain relatives under specific conditions. It is not automatic, and the family should confirm the rules with the care coordinator before relying on payment.

Does Medicaid pay for housekeeping?

Approved in-home homemaker services may include certain household tasks such as cleaning, laundry, meal preparation, shopping and errands when they form part of the person’s care plan.

Does Medicaid pay for home modifications?

The Persons Who Are Elderly waiver mainly lists in-home homemaker care, adult day services, emergency response and automated medication dispenser services. Other Medicaid programs may offer different services. Families should ask the care coordinator whether any home modification or assistive equipment program applies.

Can someone receive home care instead of entering a nursing home?

That is the purpose of home and community-based services. The person must still qualify and be capable of remaining safely at home with the services available.

Need Help Understanding Your Family’s Options?

Protect Your Loved One’s Care and Legacy with ElderSmart

Navigating Illinois Medicaid, home care limits and asset protection rules should not be done in a state of panic.

ElderSmart is the educational planning resource of The Heartland Law Firm. Through ElderSmart, Illinois families can learn about Medicaid, long-term care and estate-planning issues. Individual legal advice and legal services are provided by The Heartland Law Firm after an attorney-client relationship has been established.

Depending on your family’s situation, the next step may involve:

• Applying for home and community-based services
• Reviewing Medicaid eligibility or spenddown requirements
• Discussing whether a written caregiver agreement may be appropriate
• Reviewing existing powers of attorney and estate-planning documents
• Obtaining legal advice before transferring assets

ElderSmart helps families understand the issues and identify the appropriate next step. Individual legal advice, document preparation and legal services are provided by The Heartland Law Firm after an attorney-client relationship has been established.

Contact ElderSmart and The Heartland Law Firm to discuss your family’s next step.

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