Yes — a family member can get paid as a caregiver in Michigan, most often through the state’s Medicaid Home Help Program, which pays approved individual providers $17.13 per hour as of January 2026. Other paths include the MI Choice Waiver for people who would otherwise need a nursing home, two VA programs for families caring for veterans, and private pay arrangements funded by the care recipient, family, or long-term care insurance. Which path fits depends on the care recipient’s medical needs, income and assets, and military service history, and on your relationship to them.
The Home Help Program: The Default Path
Home Help is the most accessible option. It’s a Medicaid-funded benefit that covers personal care and household tasks for people who need help with daily activities but want to stay in their own home. The care recipient chooses their own provider, and that provider can be a family member who is at least 18: an adult child, grandchild, niece, or nephew, for example. Spouses cannot serve as paid Home Help providers.
To be approved, the family caregiver must pass a criminal background check and enroll in Michigan’s CHAMPS system (Community Health Automated Medicaid Processing System).1State of Michigan. New Home Help Individual Provider Enrollment Instructions Enrollment runs through a MiLogin account and a provider application submitted to MDHHS, which issues a provider ID once approved.
Covered tasks fall into three groups: activities of daily living (bathing, dressing, eating, toileting, grooming, mobility), instrumental activities (meal prep, light housecleaning, laundry, essential shopping, medication assistance), and complex care tasks like wound care, catheter management, respiratory treatments, and range-of-motion exercises.2State of Michigan Department of Health and Human Services. Available Services
The 2026 rate of $17.13 per hour reflects Michigan’s $13.73 minimum wage plus a $3.40 direct care worker pass-through.3State of Michigan. Numbered Letter L-25-75, Home Help Rate Increase Weekly hours are set by an MDHHS nurse or social worker who evaluates what the care recipient can and cannot do on their own. Your actual monthly income depends entirely on how many hours are authorized.
MI Choice Waiver: For Higher-Need Recipients
MI Choice serves adults who require a nursing-facility level of care but want to stay at home or in a community setting.4State of Michigan: Department of Health and Human Services. MI Choice Waiver Program It covers a broader range of services than Home Help, including personal care, homemaker help, respite care, and community living supports.
Under MI Choice’s self-determination option, participants can hire adult children and other relatives directly for certain services. A financial management services agency handles payroll, tax withholding, and background checks.5Michigan Department of Health and Human Services. MI Choice Waiver Participant Handbook
Spouses and legal guardians cannot be paid for personal care or similar services. Michigan’s federal waiver agreement explicitly excludes legally responsible individuals from paid caregiving under the program.6State of Michigan. MI Choice Waiver 1915(c) Amendment
The care recipient must be a Michigan resident, meet Medicaid income and asset limits, and be assessed as needing nursing-facility-level care. For 2026, a single applicant’s countable assets generally cannot exceed roughly $9,950, and monthly income is capped at approximately $2,982 before deductions. A nurse and social worker conduct an in-person evaluation and build a care plan.
Michigan is also rolling out a Structured Family Caregiving service under MI Choice, planned for early 2026. It’s designed specifically for live-in caregivers and includes individualized training, coaching, and support built into the service.7State of Michigan. Introduction to Structured Family Caregiving Details are still being finalized.
Separately, the Habilitation Supports Waiver pays family caregivers of individuals with intellectual or developmental disabilities who meet an institutional level of care. Enrollment runs through local Community Mental Health Service Programs.8Department of Health and Human Services. Habilitation Supports Waiver
VA Programs If You’re Caring for a Veteran
Two federal programs pay family caregivers of veterans. They operate independently of Michigan Medicaid and have their own eligibility rules.
Program of Comprehensive Assistance for Family Caregivers
PCAFC pays a monthly stipend directly to a primary family caregiver. The veteran must have a VA disability rating of 70% or higher (individual or combined), need at least six months of continuous in-person personal care, and be enrolled in VA health care.9Veterans Affairs. The Program of Comprehensive Assistance for Family Caregivers The caregiver must be at least 18 and either a family member or someone who lives full-time with the veteran.
Stipend amounts are tied to the GS-4, Step 1 salary for the veteran’s locality, divided by 12. Level 1 caregivers receive 62.5% of that monthly amount; Level 2 caregivers (for veterans who cannot sustain themselves in the community) receive the full amount.10Veterans Affairs. PCAFC Eligibility Criteria Factsheet Michigan stipends typically run from about $1,900 at Level 1 to over $3,000 at Level 2, depending on locality. Primary caregivers also gain access to CHAMPVA health insurance (if not otherwise eligible), mental health counseling, and at least 30 days of respite care per year.
Aid and Attendance
Aid and Attendance is an enhanced VA pension for wartime veterans and surviving spouses who need help with daily activities or are housebound. For 2026, a veteran with no dependents can receive up to $29,093 per year (about $2,424 per month), and a veteran with one dependent up to $34,488 per year (about $2,874 per month).11Veterans Affairs. Current Pension Rates For Veterans The VA allows this money to be used to pay a family member for in-home care. The family member doesn’t need a professional license, but a written agreement setting out services and payment strengthens the arrangement.
Private Pay and Long-Term Care Insurance
When a care recipient doesn’t qualify for government programs, or those programs don’t cover enough hours, families can pay a caregiver directly. Private pay offers the most flexibility in scheduling and scope, because no program rules dictate what’s covered.
Some long-term care insurance policies pay benefits when a family member provides the care, but this varies widely. Many older policies restrict payments to licensed agencies. Newer policies are more likely to allow family caregivers, sometimes on the condition of a physician-signed care plan. Read the policy language before counting on it.
The Caregiver Agreement: Where Families Get Tripped Up
A written caregiver agreement isn’t optional if Medicaid might ever pay for a nursing home or waiver services. Without a properly structured contract, MDHHS treats regular payments from a parent to an adult child as gifts, which triggers a divestment penalty and delays benefits.
Michigan’s Department of Health and Human Services will treat any payment for personal or home care as a transfer for less than fair market value unless the agreement meets every one of these requirements:12Michigan Department of Health and Human Services. MA Divestment – BEM 405
- The contract must be written, signed, and (typically) notarized before any caregiving work starts. Its effective date is the date it is signed and notarized, or the date the local MDHHS office receives the signed contract. Retroactive pay for work already done is not allowed.
- The caregiver can only be paid after services are provided. Prepayment for future care violates the rule.
- The care recipient cannot be in a nursing home, adult foster care home, or hospital, or already enrolled in a waiver program like MI Choice or Home Help, at the time services are provided.
- A doctor, someone in the doctor’s office, or a community health worker must sign a written statement that the services are necessary to prevent residential or nursing facility placement. Companionship alone doesn’t count.
- If a power of attorney or guardian signs on behalf of the care recipient, that representative cannot also be the paid caregiver or otherwise benefit from the contract.
- The agreement must spell out the type, frequency, and duration of services and the exact compensation, and MDHHS will review it.
Compensation should track what a professional would charge. The 2026 Home Help rate of $17.13 per hour is a reasonable benchmark for fair market value in Michigan.3State of Michigan. Numbered Letter L-25-75, Home Help Rate Increase Charging significantly above that rate without a reason (like providing complex medical care) draws scrutiny. Notarization in Michigan costs up to $10 per notarial act.13State of Michigan. Notary Services
If MDHHS finds a divestment, the penalty is a waiting period during which waiver or long-term care benefits won’t be paid. Eligibility isn’t lost outright, but the delay can force families to cover care costs out of pocket.
Taxes on Caregiver Pay
Money paid to a family caregiver is taxable income, whether it comes from a program or a private check. In most private arrangements, the IRS treats the caregiver as a household employee and the care recipient (or whoever controls the payments) as a household employer.
If you pay a household caregiver $3,000 or more in cash wages during 2026, you must withhold and pay Social Security and Medicare taxes totaling 15.3% of wages, split evenly between employer and employee. If total cash wages to household employees reach $1,000 in any calendar quarter of 2025 or 2026, federal unemployment tax also applies, on the first $7,000 of each employee’s wages.14Internal Revenue Service. Publication 926 (2026), Household Employer’s Tax Guide
Some family relationships create exemptions. You do not owe Social Security or Medicare taxes on wages paid to your spouse, your child under 21, or your parent (with limited exceptions), and generally not on any employee under 18 unless caregiving is their main occupation.15Internal Revenue Service. Family Caregivers and Self-Employment Tax Wages should still be reported on a W-2.
Caregivers paid through Medicaid waiver programs like Home Help or MI Choice may be able to exclude that income from federal tax entirely. IRS Notice 2014-7 treats qualifying Medicaid waiver payments as difficulty-of-care payments excludable under Section 131 of the Internal Revenue Code, whether or not the caregiver is related to the care recipient.16Internal Revenue Service. Certain Medicaid Waiver Payments May Be Excludable From Income The key condition is that the caregiver and care recipient share a home. A tax professional can confirm whether your arrangement qualifies.
One more Michigan-specific note: a family member living in the care recipient’s home is not an employee for workers’ compensation purposes, and a private household employer has no workers’ compensation liability for non-resident caregivers unless the caregiver works 35 or more hours per week for at least 13 of the preceding 52 weeks.17Michigan Legislature. MCL – Section 418.118 – Domestic Servants
Where to Start Based on Your Situation
For most families, the fastest route is Home Help. Contact your local MDHHS office and request an assessment. A caseworker evaluates daily tasks and authorizes a weekly hour allotment. Once approved, your family caregiver enrolls through CHAMPS and can begin getting paid.
If the care recipient’s needs rise to a nursing-facility level, ask about MI Choice. The entry point is your local Area Agency on Aging or MDHHS, and the assessment includes both medical and financial evaluations.4State of Michigan: Department of Health and Human Services. MI Choice Waiver Program
Veterans and prospective caregivers should contact a VA Caregiver Support Coordinator at the nearest VA medical center, or apply together online at VA.gov.9Veterans Affairs. The Program of Comprehensive Assistance for Family Caregivers
For any private pay arrangement, draft the written caregiver agreement before the first day of paid care. Include the services, schedule, hourly rate, and payment terms. Have it notarized, and if Medicaid eligibility is even a possibility later on, make sure it satisfies the MDHHS requirements above. Skipping this step is the single most expensive mistake families make.