How to Pay for Companion Care Services
Most families pay for companion care through a combination of private funds, long-term care insurance, and government programs. While traditional Medicare does not cover non-medical companion services, several other options — including VA Aid & Attendance benefits, Medicaid Home and Community-Based Services waivers, and long-term care insurance — can significantly offset costs or cover them entirely.
Does Medicare Cover Companion Care?
Traditional Medicare (Parts A and B) does not cover non-medical companion care. Medicare is designed for medically necessary services and does not pay for help with household tasks, companionship, or transportation unless they are part of a skilled care plan.
However, Medicare Advantage (Part C) plans are different. Many Medicare Advantage plans now include supplemental benefits for non-medical home care, including companion visits. These benefits vary significantly by plan and region. It is worth calling your plan directly to ask about in-home support services coverage. Some plans offer 20 to 60 hours per year of in-home support.
Can Medicaid Help Pay for Companion Care?
Medicaid coverage for companion care varies by state, but many states offer Home and Community-Based Services (HCBS) waiver programs that cover non-medical home care including companion services. Key points:
- Eligibility: Medicaid HCBS waivers have both financial and functional eligibility requirements. Most states require the individual to meet nursing-home-level-of-care criteria
- Wait lists: Some state waiver programs have significant waiting lists, so apply as early as possible
- Self-directed options: Several states allow participants to hire their own caregivers through consumer-directed programs, sometimes including family members
- Covered services: Typical covered services include homemaker assistance, companionship, respite care, meal delivery, and transportation
Contact your state Medicaid office or Area Agency on Aging to learn which waiver programs are available in your area and how to apply.
What Are VA Benefits for Companion Care?
Veterans and surviving spouses of veterans may qualify for significant financial assistance through VA programs:
- Aid & Attendance (A&A): This enhanced VA pension provides up to $2,431 per month for a single veteran (2025 rates) who needs help with daily activities. Surviving spouses may receive up to $1,318 per month. These funds can be used to pay for companion care
- Housebound benefit: A lower-level benefit for veterans who are substantially confined to their home, providing additional monthly income
- VA Caregiver Support Program: Provides training, respite care, and financial stipends for family members caring for eligible veterans
- State Veterans Benefits: Many states offer additional home care benefits for veterans beyond federal programs
Applying for VA benefits can take several months, so families should start the process early. Veterans service organizations like the VFW, American Legion, and DAV offer free assistance with applications.
Does Long-Term Care Insurance Cover Companion Care?
Many long-term care insurance (LTCI) policies cover companion care, but coverage depends on the policy terms:
- Benefit triggers: Most policies require the insured to need help with at least two activities of daily living (ADLs) or have a cognitive impairment before benefits begin
- Elimination period: Policies typically have a waiting period of 30 to 90 days before benefits start. Some policies count companion visits toward this elimination period
- Provider requirements: Many policies require care to be provided by a licensed home care agency rather than an independent caregiver
- Daily/monthly maximums: Policies set a maximum daily or monthly benefit amount, typically $100 to $300 per day
- Home care riders: Some policies have specific home care riders that cover non-medical support including companionship
Review your policy carefully or call your insurance company to confirm what home-based companion services are covered before starting care.
What About Private Pay and Other Funding Options?
Beyond insurance and government programs, families use several strategies to fund companion care:
- Personal savings and retirement funds: The most common payment method. Many families budget companion care as a regular monthly expense
- Family cost-sharing: Adult siblings divide the cost of a parent's care, making it more manageable for each individual
- Reverse mortgages: Homeowners 62 and older can convert home equity into funds for care while continuing to live in the home
- Life insurance conversion: Some life insurance policies allow accelerated death benefits or can be sold through life settlement programs to fund current care needs
- State and local programs: Area Agencies on Aging, Older Americans Act programs, and local nonprofits sometimes offer subsidized companion or homemaker services for qualifying seniors
- Tax deductions: If the care recipient qualifies as a dependent, some companion care costs may be deductible as medical expenses. Consult a tax professional for guidance
How Can I Maximize My Benefits and Minimize Costs?
A few practical strategies can help families get the most value:
- Combine funding sources: Use VA benefits for a portion, family funds for the remainder, and apply for Medicaid waivers as a long-term solution
- Start early: Government benefit applications take time. Begin the process months before care is urgently needed
- Work with a benefits specialist: Organizations like BenefitsCheckUp.org and your local Area Agency on Aging can identify programs you may not know about
- Review provider pricing: Compare costs across providers and ask about package discounts for consistent weekly schedules
- Use a care manager: A geriatric care manager can help coordinate benefits, manage care plans, and ensure your family uses available resources efficiently