How to get paid to care for a family member in Kentucky: Participant Directed Services

Participant Directed Services: Kentucky's paid family caregiver route

PDS lets people on a Kentucky 1915(c) Medicaid waiver hire their own providers for non-medical, non-residential services. The Department for Medicaid Services (DMS) says those providers can be friends, neighbors or "certain family members." The option used to be called the Consumer-Directed Option (CDO), a name you may still see on older forms.

Five waivers allow PDS: Acquired Brain Injury (ABI), ABI Long-Term Care, Home and Community Based (HCB), Michelle P. (MPW) and Supports for Community Living (SCL). For a family looking after an aging parent or spouse, HCB is the relevant one, and the rest of this guide focuses on it. HCB services include attendant care, adult day health care, respite, home-delivered meals and minor home adaptations, and participants can take them from a traditional agency, through PDS, or as a blend of the two.

Who qualifies for the HCB waiver

According to the DMS HCB page, a person may qualify if they:

• Are 65 or older, have a physical disability, or both. The waiver also serves children with physical disabilities.
• Meet the requirements for living in a nursing facility, set out in regulation 907 KAR 1:022.
• Meet Medicaid's financial rules. DMS notes that special financial qualifications apply to the waiver and points to the Medicaid Waiver Services Fact Sheet (MAP-418).

Waiting list. DMS states that there is currently a waiting list for HCB services, and that your place on it depends on the date your completed application is received. Applying early matters for that reason.

How to apply: waiver-supportive Medicaid, then the waiver

DMS's guide to applying for waiver services (updated October 5, 2026) describes two separate applications. Neither is accepted by mail.

1. Waiver-supportive Medicaid. Apply online at kynect (you need a KYID account), by phone with the Department for Community Based Services at (855) 306-8959, or at a DCBS office. On the phone, choose healthcare and food benefits, then waiver-supportive Medicaid. Have identification, Social Security number, income and resource information, insurance cards and medical bills ready.
2. The HCB application. Once the Medicaid application is approved or pending, apply for the waiver on kynect or in person at an Aging and Disability Resource Center or a Community Mental Health Center. For HCB you need a MAP-10 and a physician's statement describing how the physical disability affects daily activities. To find an ADRC, call (877) 925-0037.

DMS then reviews the application and sends a letter saying whether the applicant qualifies. The Department for Aging and Independent Living (DAIL), which operates HCB with DMS, answers program questions at (877) 315-0589.

Can a spouse or parent be paid? The legally responsible individual review

Kentucky separates relatives into two groups. A legally responsible individual (LRI) is, for a minor, a parent, stepparent, adoptive parent or court-appointed guardian, and for an adult, a spouse or court-appointed guardian. Everyone else, including adult children, siblings and grandparents, is not an LRI and does not need a review to be hired. The DMS PDS FAQ (updated June 27, 2024) adds that a power of attorney alone does not make someone an LRI, and a parent of an adult child is not one unless the parent is the court-appointed guardian.

An LRI can be paid only for what federal rules call "extraordinary care," and since July 1, 2024 DAIL must approve the LRI before they start work. For an adult participant, at least one of these must be verified:

• Caregiving has reduced or ended the LRI's ability to keep paid work within the past 12 months, and no other caregiver in the home can provide care.
• The LRI tried for 30 days to recruit another qualified provider, traditional or PDS, without success.
• The participant has a communication barrier that affects their ability to tell a care provider what they need.

For a minor, the family must meet one test from each of two lists: one like those above, and one showing either a level of dependence in daily activities beyond age-matched peers or behaviors that risk serious injury. The PDS case manager submits the request, DAIL targets a decision within five business days of a complete file, and the review is one-time. Foster parents cannot be paid PDS employees.

Hiring, hours and payroll under PDS

• Employees. Workers have to be 18 or older and clear a criminal background check. The participant, or a PDS representative, hires, trains, schedules and can fire them.
• PDS representative. A qualified friend or relative can help direct services, but cannot charge for that help or be a paid employee.
• Case manager. Everyone using PDS has a PDS case manager, who helps with the service plan, hiring and rate negotiation. Ask the regional Area Agency on Aging, or alternatively a community mental health center, for one.
• Training. The participant, representative and employees complete training on person-centered planning and self-determination.
• Payroll. The participant submits timesheets, and a financial management agency pays the employee and handles tax withholding.
• Hours. DMS's rate policy FAQ says no PDS employee should work more than 40 hours a week and that overtime has been discontinued. Separately, HCB attendant care is limited to 45 hours a week, or $200 a day, alone or combined with adult day health care. The employee contract records the maximum hours agreed.

How much does Kentucky pay a family caregiver?

Kentucky publishes a maximum rate. The DMS fee schedule for HCB waiver services (rates effective January 1, 2025) lists Attendant Care through PDS at $7.26 per 15-minute unit, which works out to $29.04 an hour. The PDS FAQ says participants can raise an employee's pay as long as it stays within that maximum, so the actual wage is whatever the participant and employee agree in the contract, up to the cap. Non-specialized respite through PDS is listed at $5.92 per unit.

The BLS and minimum wage rows are reference points for the wider job market, not PDS rates. At the 40-hour weekly limit, the hourly maximum would come to $1,161.60 a week before taxes (illustrative calculation: 40 × $29.04).

VA programs and taxes

Veterans. Caring for a veteran opens two more doors. The VA stipend program known as PCAFC pays a monthly amount to one designated Primary Family Caregiver. It applies when the veteran holds a combined or individual rating of 70% or above, is enrolled for VA care, and will need someone's in-person help for six months or more in a row. Caregivers qualify from age 18 by being family, or by living with the veteran full time or agreeing to; the veteran and caregiver both sign VA Form 10-10CG. Veteran-Directed Care, where available, instead gives the veteran a spending plan to hire workers, and the VA says that can include a family member.

Income tax. Because HCB operates under section 1915(c), Kentucky PDS pay may fall under IRS Notice 2014-7, which lets a provider leave waiver payments out of gross income when the participant lives with them in a shared home. The IRS Q&A treats a parent's home as yours if you moved in to care for them and have no other residence. Social Security and Medicare tax treatment depends on who is legally your employer; your financial management agency can tell you how it reports your pay.

Private hiring. Families who hire outside Medicaid should know the IRS Topic 756 rule: cross $3,000 of cash pay to any single household worker during 2026 and Social Security and Medicare tax generally applies to the wages, with the employer withholding the worker's share, paying its own, and filing Schedule H. Pay to a spouse, to a child under 21, or to a parent unless an exception is met, is not counted.

Local help and reporting abuse

• Area Agencies on Aging and ADRCs. DMS points families to an AAA or a Community Mental Health Center to find a PDS case manager. Around Richmond, the Aging & Independent Living office of the Bluegrass Area Development District runs the ADRC for 17 central Kentucky counties, Madison among them; call 859-266-1116 (toll-free 1-866-665-7921). It also supports HCB participants using traditional, PDS or blended services.
• Adult Protective Services. DCBS investigates suspected abuse, neglect or exploitation of adults. Report by phone at (877) 597-2331 or (800) 752-6200. Non-emergency reports can also be made online; the online system is checked 8 a.m. to 4:30 p.m. Eastern on weekdays. In an emergency, call 911.

Where CaregiverConnect fits

CaregiverConnect is not a Medicaid provider, a PDS case management agency, a financial management agency or a home care agency, and it cannot enroll anyone in the HCB waiver. A Kentucky family can list a care job without charge and then hire the person it chooses, which puts the family in the role of household employer. Anyone offering care can open a profile without paying and respond to posted jobs. A PDS participant who needs a worker outside the family could look there, but that person would still go through the background check and employee contract that PDS requires. Read how it works, and see the pricing page for optional plans.

Caregivers near Richmond are on the Richmond, Kentucky page. If you are hiring privately, start with how to hire a private caregiver, while caregivers can use how to write a caregiver profile. For a national overview, see Medicaid programs for family caregivers.

Frequently asked questions

Sources

1. Kentucky CHFS DMS, Participant-Directed Services
2. Kentucky CHFS DMS, Home and Community Based Waiver
3. Kentucky DMS, Understanding Kentucky's 1915(c) HCBS Waivers: Applying for Waiver Services (updated 10/5/2026)
4. Kentucky DMS, Participant Directed Services Frequently Asked Questions (updated 06/27/2024)
5. Kentucky DMS, Legally Responsible Individuals as PDS Employees: Q&A for participants (June 20, 2024)
6. Kentucky DMS, Rate Increase Policies for Participant Directed Services (updated 12/21/2023)
7. Kentucky DMS, Fee and Rate Schedules
8. Kentucky DMS, Home and Community Based Services Waiver Rates 2025 (Excel)
9. Kentucky DCBS, Adult Protection Branch
10. Bluegrass ADD, Aging and Disability Resource Center
11. Bluegrass ADD, Medicaid Waiver Program (HCB)
12. BLS, OEWS May 2025 data query (SOC 31-1120, Kentucky)
13. Kentucky Labor Cabinet, Wages and Hours
14. VA, Program of Comprehensive Assistance for Family Caregivers
15. VA, Veteran-Directed Care
16. IRS, Certain Medicaid waiver payments may be excludable from income (Notice 2014-7 Q&A)
17. IRS, Topic 756: Employment taxes for household employees