Kentucky pays many family members to provide care through Participant Directed Services, with a narrow new exception for spouses. Add waiver respite, NFCSP grants, and VA benefits.
If you are caring for an aging parent, a spouse, or an adult child with a disability in Kentucky, the hard part is rarely whether help exists. It is knowing what is there and where to start. This guide maps every major caregiver program in the state for 2026.
You don't have to figure this out alone, and you don't have to fund all of it from your savings.
In This Guide
- Kentucky Caregiver Programs at a Glance
- Programs That Pay Family Caregivers
- Respite Care Programs
- Support, Training, and Area Agencies
- VA Caregiver Benefits in Kentucky
- Taxes for Kentucky Caregivers
- Frequently Asked Questions
- Learn More
Kentucky Caregiver Programs at a Glance
| Program | What It Offers | Who Qualifies | Cost to You |
|---|---|---|---|
| Participant Directed Services (PDS) | Participant hires and directs their own workers, including relatives | Medicaid 1915(c) waiver participants (HCB, SCL, Michelle P., ABI) | Free (paid by Medicaid) |
| LRI extraordinary care exception | Spouse or parent of a minor paid for extraordinary care (since 7/1/2024) | PDS participants whose LRI provides documented extraordinary care | Free (paid by Medicaid) |
| NFCSP respite grants | Free in-home respite, adult day vouchers, training, counseling | Caregivers of adults 60+ or person with ADRD; no income test | Free |
| VA PCAFC | Monthly tax-free stipend; pays spouses | Veteran with 70%+ disability in VA health care | Free (VA benefit) |
| VA Aid and Attendance | Pension up to $2,424/mo to veteran; caregiver paid from it | Wartime veteran or surviving spouse under net-worth limit | Free to apply (VSO help) |
Programs That Pay Family Caregivers
Participant Directed Services (PDS)
Participant Directed Services (PDS) is the self-directed option within Kentucky's Medicaid 1915(c) waivers, administered by the Department for Aging and Independent Living (DAIL) under the Department for Medicaid Services (DMS). The waiver participant acts as the employer: they hire, manage, and pay their own workers for non-medical waiver services, and they may hire family members, friends, and neighbors within Medicaid guidelines.
PDS is available through the Home and Community Based (HCB) waiver (aging and physical disabilities), the Supports for Community Living (SCL) and Michelle P. waivers (intellectual or developmental disabilities), and the Acquired Brain Injury (ABI and ABI-LTC) waivers. A PDS case manager or support broker helps develop the plan of care and budget.
Who can be paid: Adult children, other relatives, friends, and neighbors. The spouse rule: a spouse generally cannot be paid, and legally responsible individuals (a spouse, or the parent of a minor child) generally cannot be paid. A rule effective July 1, 2024 created a limited exception allowing an LRI to be paid when they provide extraordinary or specialized care beyond what a typical caregiver provides, subject to documentation requirements.
A Financial Management Services (FMS) agency handles the employer back-office functions: payroll, tax withholding and reporting, and worker background checks. The participant remains the employer of record who hires, schedules, and may dismiss workers, while the FMS agency processes the pay.
For the full guide to paid pathways: How to Get Paid as a Family Caregiver in Kentucky.
Respite Care Programs
Medicaid Respite (PDS Waivers)
The HCB, SCL, Michelle P., and ABI waivers authorize respite as a covered service within the participant's plan of care, delivered by an eligible PDS worker. Ask your PDS case manager or support broker to include respite.
NFCSP Grants Through Kentucky's 15 Area Agencies on Aging
The National Family Caregiver Support Program (NFCSP), funded by Title III-E of the Older Americans Act, flows through the Kentucky Cabinet for Health and Family Services, Division of Aging Services, to 15 regional Area Agencies on Aging. Services include in-home respite, adult day vouchers, caregiver training, and counseling, with no income test for respite services. Call 1-800-372-2991.
For the full respite guide: Respite Care in Kentucky.
Support, Training, and Area Agencies
Kentucky's 15 Area Agencies on Aging and Independent Living are the front door for most caregiver support that is not tied to a Medicaid waiver. They deliver NFCSP services, adult day referrals, caregiver training, counseling, and local resource information.
Call 1-800-372-2991 (CHFS helpline) to reach your regional AAA, or dial 211 for the broader social-services network. These calls are free. A counselor will identify what is available in your area and help you start an application.
If your loved one is enrolled in a PDS waiver, the PDS case manager or support broker is your key contact for adjusting the plan of care, including adding respite or hiring a paid family worker.
VA Caregiver Benefits in Kentucky
Veterans enrolled in VA health care in Kentucky have access to caregiver support programs that are separate from Medicaid and often more generous.
VA Program of Comprehensive Assistance for Family Caregivers (PCAFC)
The PCAFC pays a monthly stipend to the Primary Family Caregiver of an eligible veteran. The stipend is calculated from the federal GS-4, Step 1 annual rate for the veteran's locality, divided by 12, then multiplied by a level factor. It is federal tax-free and allows paid spouses. To qualify, the veteran needs a service-connected disability rating of 70 percent or higher, a need for in-person personal care for at least six continuous months, and enrollment in VA health care.
Because PDS generally excludes spouses, the PCAFC stipend and Veteran-Directed Care are often the routes through which a Kentucky spouse can be paid to provide care.
Kentucky VA facilities: The Robley Rex VA Medical Center in Louisville and the Lexington VA Health Care System are the main VA medical centers, with shared services from the Cincinnati and Huntington VA systems for some border areas.
VA Aid and Attendance Pension
Wartime veterans and surviving spouses who meet the functional criteria and have countable assets and income under the net-worth limit ($163,699 in 2026) may receive the Aid and Attendance pension. A single veteran with Aid and Attendance receives up to $2,424 per month ($29,093/year); a veteran with one dependent up to $2,874 per month. The pension goes to the veteran, who typically pays a family caregiver from it.
The Kentucky Department of Veterans Affairs and county Veterans Service Officers help file at no cost.
VA Caregiver Support Line: 1-855-260-3274
Taxes for Kentucky Caregivers
IRS Notice 2014-7
If you live in the same home as the person you care for and are paid through a Medicaid program, your wages may be excluded from federal gross income under IRS Notice 2014-7. This applies to many Kentucky PDS arrangements. Talk to a tax preparer familiar with the rule before filing.
Kentucky State Income Tax
Kentucky levies a flat individual income tax. Because Kentucky starts from federal adjusted gross income, the IRS Notice 2014-7 exclusion generally flows through to the Kentucky return. Confirm the current rate with the Kentucky Department of Revenue.
VA PCAFC Stipend
The PCAFC monthly stipend is federal tax-free and is not reported on a W-2.
Not sure which Kentucky caregiver program fits your family? Chat with Brevy's care navigator for a personalized comparison based on your loved one's Medicaid enrollment, veteran status, and whether you are a spouse or non-spouse caregiver.
Frequently Asked Questions
Generally not through Participant Directed Services, which excludes legally responsible individuals (a spouse, or the parent of a minor). A rule effective July 1, 2024 created a narrow exception allowing an LRI to be paid for extraordinary or specialized care, with documentation. If your spouse is a veteran, the PCAFC stipend and Veteran-Directed Care can pay a spouse.
Adult children, other relatives, friends, and neighbors may be hired and paid as PDS workers. The waiver participant is the employer who hires, schedules, and may dismiss workers, while a Financial Management Services agency processes the pay.
PDS is available through the Home and Community Based (HCB) waiver for aging and physical disabilities, the Supports for Community Living (SCL) and Michelle P. waivers for intellectual or developmental disabilities, and the Acquired Brain Injury (ABI and ABI-LTC) waivers.
Yes. The National Family Caregiver Support Program provides free respite through Kentucky's 15 Area Agencies on Aging with no income test. Call 1-800-372-2991.
Call 1-800-372-2991 (CHFS helpline) to reach your regional Area Agency on Aging and Independent Living, or dial 211. They handle NFCSP respite grants, adult day referrals, and caregiver training.
Learn More
- How to Get Paid as a Family Caregiver in Kentucky
- Respite Care in Kentucky
- Caregiver Burnout: Signs, Stages, and How to Get Support
- VA Aid and Attendance in Kentucky
- Medicaid Planning Strategies
Find personalized help navigating Kentucky caregiver programs at brevy.com.
The information on Brevy.com is for educational purposes only and is not a substitute for professional legal, financial, or medical advice. Rules vary by state and program and change frequently. Always verify with the relevant agency or a qualified professional. Brevy is not a law firm, financial advisor, or healthcare provider.