Paying family caregivers: self-direction in medicaid personal care

As people age, many require help with personal care-often provided by family members or friends or direct care workers. Over the last three decades, driven by the disability rights movement, direct care worker shortages, and caregiver burden, self-direction has emerged as a Medicaid option that allows individuals to hire and pay their own caregivers, including family members.

We use 2021 TMSIS Medicaid claims data linked to Medicare Master Beneficiary Summary File to identify dually eligible beneficiaries 65+ receiving personal care. We describe the demographic characteristics of self-direction users compared to non-self-direction users and present the percentage of self-direction users across states.

We find that over half of dually eligible beneficiaries 65+ receiving personal care use self-direction. Compared to individuals who use agency-based personal care, self-direction users have higher prevalence of chronic disease, higher home health use, and higher Medicare costs.

Self-direction has become a common model of personal care among older adults enrolled in Medicaid. Examining how funds allocated for self-direction are spent; the effects of self-direction on consumers and their caregivers; and how self-direction may impact Medicare and Medicaid costs is critical to inform the expansion and funding of Medicaid self-direction programs.