What Is Medicaid Home Care?
Medicaid home care is gaining renewed attention — and scrutiny. Policymakers, federal agencies, and the public are closely examining how these services are delivered, who receives them, and where fraud may occur.
Home care, also called personal care or in-home supportive services, helps older adults and people with disabilities with daily tasks. These tasks include bathing, dressing, and eating. According to KFF, over 5 million people currently use Medicaid home care. Crucially, this benefit lets individuals receive long-term support without moving into a nursing facility.
The Trump administration has recently flagged Medicaid home care as a high-risk area for fraud. Home-based services are harder to monitor than institutional care. Furthermore, many recipients — including those with Alzheimer’s disease or other dementias — face challenges advocating for themselves. These factors combined create conditions where fraud can go undetected.
However, it is important to note that additional safeguards exist specifically for home care. These protections go beyond what applies to other Medicaid services.
Who Qualifies for Medicaid Home Care?
Financial and Functional Eligibility Requirements
Every state offers optional Medicaid home care services. To qualify, applicants must meet two criteria: financial eligibility and functional eligibility.
Functional eligibility means a person’s care needs must be severe enough to require institutionalization. States use their own assessment tools to evaluate this. Generally, eligible individuals must need 24-hour support and assistance with multiple activities of daily living (ADLs). These include bathing, dressing, eating, toileting, continence, and transferring between a bed and other settings.
States may only provide home care if doing so costs no more than institutional care for the same individual. Despite this restriction, all states choose to offer home care. This reflects both public preference and legal obligation.
The Olmstead Decision and Institutional Bias
Historically, Medicaid required states to cover nursing facility care but not home care. This was called the “institutional bias.” However, the 1999 Supreme Court ruling in Olmstead v. L.C. changed that. The Court declared that unjustifiably institutionalizing people with disabilities is a form of discrimination under the Americans with Disabilities Act (ADA). As a result, states significantly expanded home care access. Today, most Medicaid long-term care users receive services at home rather than in a facility.
Why Institutional Care Falls Short for Families
The Limits of Family Caregiving
Many families want to care for their loved ones at home. However, institutional-level care goes beyond what most family members can realistically provide.
People who need this level of care often have complex needs. They may require both skilled nursing and unskilled daily assistance — sometimes around the clock. Additionally, physical demands can be a major barrier. Helping someone bathe or transfer from bed requires significant strength. Not every family caregiver has that capacity.
Time is another factor. Providing intensive care full-time makes it nearly impossible to hold a job or maintain one’s own health. KFF focus groups with paid and unpaid caregivers confirm this. Participants described caregiving as physically, mentally, and emotionally draining.
How Medicaid Supports Family Caregivers
To address this, Medicaid offers supplemental paid care alongside family support. In some cases, family members receive direct payments. These payments reflect the reality that caregiving can eliminate the ability to maintain outside employment. Other supports include respite care and caregiver training programs.
How Governments Fight Home Care Fraud
Electronic Visit Verification
Recognizing the elevated fraud risk in home care, Congress passed the 21st Century Cures Act in 2016. This law requires states to implement electronic visit verification (EVV) for all Medicaid personal care and home health services. EVV must capture six data points: the member receiving services, the caregiver providing them, the service type, the location, the date, and the start and end times of each visit.
States had until 2023 to fully implement EVV. The HHS Office of Inspector General (HHS OIG) is currently evaluating how states are using EVV data to strengthen program integrity.
Fraud Convictions Are Declining
EVV appears to be making a difference. In fiscal year 2024, there were 298 fraud convictions involving personal care attendants. This represented 36% of all Medicaid fraud control unit convictions — the highest share of any provider type. However, this figure is notably lower than the pre-EVV average of over 400 convictions per year between 2015 and 2022.
Nevertheless, the total money recovered remains modest. In FY 2024, recoveries totaled $961 million. Compared to total Medicaid spending, this is a small fraction.
Provider Credentialing and Data Analytics
States also use provider credentialing and enrollment checks. These tools verify that providers meet federal and state requirements. Moreover, data analytics help identify unusual billing patterns and flag providers convicted of fraud in other states.
Minnesota’s recent fraud investigation illustrates this approach. When the state uncovered widespread fraud in 2024, it acted swiftly. It targeted specific providers and service types, demonstrating that proactive data use can contain fraud before it escalates.
What New CMS Data Reveals
A Useful but Limited Dataset
On February 14, 2026, CMS released a new provider-level spending dataset. The agency suggests it can identify unusual billing patterns by service, state, or provider. Still, the dataset has significant limitations that require caution.
The data include just seven fields: beneficiary counts, service counts, and total spending by procedure. Importantly, they omit institutional records and prescription drug spending. Hospital care alone accounts for 37% of all Medicaid spending — yet it is entirely excluded from this dataset.
Additionally, the personal care “procedure” code covers a broad range of services. These vary in complexity, duration, and intensity — from under 30 minutes to a full day. In contrast, emergency department visits use multiple codes based on case complexity. This inconsistency makes direct comparisons misleading.
Personal Care Tops Spending Data
Despite these limitations, the data show that personal care ranks as the top Medicaid procedure by spending. This reflects the scale of home care — not necessarily misuse. Therefore, interpreting this data without context risks drawing incorrect conclusions.
Why Home Care Spending Has Grown
Policy Choices, Not Just Fraud
Increased Medicaid home care spending largely reflects deliberate policy decisions. Between 1981 and 2023, home care grew from 1% to 64% of all long-term care spending. This shift stems from both legal obligations and evolving public preferences.
The COVID-19 pandemic further accelerated this trend. It exposed serious vulnerabilities in institutional care and highlighted unmet demand for home-based services. In response, states expanded home care access, raised payment rates for home care workers, and developed new programs to keep people at home.
Between 2019 and 2023, the number of Medicaid home care users grew by more than 750,000 people. Notably, this expansion has bipartisan support. Both 2024 presidential candidates voiced support for family caregivers and expanded at-home services.
A Balanced Perspective on Fraud and Value
Fraud in Medicaid home care is real and deserves serious attention. However, the broader story is one of growing access, evolving safeguards, and a fundamental shift toward care that respects people’s dignity and preferences. As policymakers review new CMS data, context and nuance are essential. Sound policy must protect taxpayers while preserving services that millions of Americans depend on every day.
