Kentucky doesn't use the "Structured Family Caregiving" name you'll see in some other states — but family members can still get paid to provide care, through a Medicaid mechanism called the Consumer Directed Option (CDO).
What it is
Kentucky pays family caregivers through Medicaid Home and Community Based Services (HCBS) waivers — specifically the HCB Waiver (for adults 65+ or with disabilities) and the Michelle P. Waiver (for Kentuckians with intellectual or developmental disabilities). Both can be paired with the Consumer Directed Option, which lets the Medicaid participant act as the employer of record and hire a family member as their paid caregiver.
Who qualifies — the care recipient
- Must be Medicaid-eligible
- Must meet a nursing facility level of care requirement (HCB Waiver) or relevant disability criteria (Michelle P. Waiver)
- Must meet income and asset limitations
Who qualifies — the caregiver
- Generally cannot be a spouse or legal guardian — a firm exclusion under CDO
- Must pass required background checks and enrollment steps
An important exception for veterans
If the person you care for is a veteran, Veteran Directed Care (VDC) works differently and can pay a spouse as caregiver — a notable contrast to the CDO spousal exclusion above.
How to apply
- Confirm the care recipient's Medicaid eligibility
- Request a formal functional/level-of-care assessment
- Contact a Medicaid case manager to discuss HCB Waiver or Michelle P. Waiver eligibility and CDO
- Identify the family member who will serve as the paid caregiver
- Complete enrollment, background checks, and register with the fiscal intermediary that handles payroll
What you'll need to keep track of once approved
- Documentation of care hours and tasks performed
- Records supporting the ongoing level-of-care determination
- Payroll/employment records through the fiscal intermediary
Keeping this organized
Once set up as a paid caregiver through CDO, staying compliant with documentation and hour-logging requirements is an ongoing task. FeatherKeep organizes this automatically as you go.