Family Caregivers Spend $11,508 a Year: The Case for Better CDPAP Pay

Family caregiving often brings a financial burden alongside the responsibility of helping a loved one live safely at home. A new AARP report puts average annual out-of-pocket caregiving expenses at $11,508, up from $7,242 in 2021. That is an increase of approximately 59%, with the latest annual figure equivalent to $959 a month. (Source 1)

For New York families, those findings add urgency to the discussion about the Consumer Directed Personal Assistance Program, or CDPAP. The program allows eligible Medicaid members to choose qualifying relatives or friends as paid caregivers. It recognizes that helping a family member can also be real employment, with responsibilities that deserve fair compensation. (Source 8)

A family’s expenses may build gradually: groceries for a parent, supplies for a spouse, transportation, or help with housing. These purchases can sit alongside time away from work and changes to a caregiver’s own household budget. A useful discussion of caregiving must consider both the care recipient’s needs and the resources of the person providing support.

AARP reports that caregivers devote an average of 31% of annual household income to care-related expenses. Among caregivers with household incomes below $40,000, the reported average share reaches 76%. These are averages across survey respondents, and individual circumstances vary considerably. (Source 2)

Most reported spending goes toward essentials. Housing and household expenses average $4,797 annually, accounting for 42% of the total. Medical expenses average $3,313, or another 29%. Together, those categories represent approximately 71% of caregivers’ out-of-pocket costs. (Source 3)

The demands are greater for some families. Caregivers supporting someone with Alzheimer’s disease or another dementia reported average annual spending of $15,846, compared with $10,221 among those supporting someone without dementia. Meanwhile, 65% of working caregivers experienced at least one work-related disruption, such as changing hours, taking time off, or taking on additional work. (Source 3)

The regional findings are particularly relevant to New Yorkers. Caregivers in the Mid-Atlantic region—New York, New Jersey, and Pennsylvania—reported average annual expenses of $15,845. That is a regional estimate, rather than a New York-only figure, but it shows that the national average does not capture every area’s experience. (Source 3)

The comparison over time needs context. AARP’s 2026 research included a survey and a one-week expense diary, with an analytic sample of 2,538 caregivers of adults. The earlier study occurred during the COVID-19 pandemic, and the newer questionnaire expanded some expense questions. Inflation contributed to the increase; AARP estimates that the 2021 average would be approximately $9,100 in inflation-adjusted terms. The reported 59% rise therefore reflects more than a direct comparison of prices for an unchanged set of services. (Sources 1, 2)

CDPAP addresses one part of the caregiving picture by allowing payment for eligible care. A recipient must meet Medicaid and program requirements, have an assessed need for home care, and be able to direct the services or have a designated representative who can do so. Qualifying relatives can include adult children and parents of adults age 21 or older. A recipient’s spouse, designated representative, or parent of a consumer under 21 cannot be that consumer’s paid personal assistant. (Source 8)

The consumer or designated representative recruits, hires, trains, and supervises the assistant. The health plan or local social services district authorizes the services. Public Partnerships LLC (PPL) is New York’s statewide fiscal intermediary, handling payroll and related employment administration. Payment is for authorized care actually provided, rather than a general cash payment to the person receiving care. (Sources 9, 10)

PPL currently lists minimum base wage rates effective January 1, 2026, of $20.65 an hour in New York City, $20.05 in Nassau, Suffolk, and Westchester, and $18.65 elsewhere in the state. These are the minimum base rates PPL publishes, rather than a calculation of any individual worker’s total compensation, benefits, or overtime. (Source 10)

CDPAP also differs from Medicare’s home health benefit. Original Medicare generally does not cover ongoing custodial long-term care, such as help with bathing or dressing when that is the only care needed. Eligible patients may receive certain skilled home health services, with aide care covered under specified conditions. Families should establish which program covers the needed service before assuming that insurance will pay for continuing help at home. (Sources 4, 5)

Questions about caregiver wages often lead to another concern: whether anti-kickback laws restrict money earned by a relative through CDPAP.

Eligible family caregivers can lawfully receive wages for genuine, authorized CDPAP work. Federal law includes an exception for qualifying payments within a bona fide employment relationship, reflected in 42 U.S.C. § 1320a-7b(b)(3)(B) and the employee safe harbor at 42 C.F.R. § 1001.952(i). Being related to the recipient does not, by itself, turn permitted compensation into a kickback. (Sources 8, 12, 14)

However, the federal Anti-Kickback Statute prohibits knowingly and willfully offering, paying, soliciting, or receiving remuneration to induce or reward covered referrals or arrangements for federally funded healthcare business. New York Social Services Law § 366-d separately prohibits specified payments connected to Medicaid referrals and purchases. Those rules remain relevant when the money involved comes from a caregiver’s paycheck. (Sources 12, 13)

An agreement to give the care recipient part of each paycheck as the price of choosing or retaining the assistant can implicate these laws. Providing the care does not, by itself, remove the legal problem with an inducement. Depending on the arrangement, payments intended to influence a beneficiary’s selection can also raise issues under the separate beneficiary-inducement rules. (Source 15)

Ordinary family finances require a more careful distinction. Applying the general legal framework, paying one’s genuine share of household groceries, rent, or other shared expenses is not automatically a kickback simply because the earnings came from CDPAP. But there is no blanket exemption for relatives. The payment’s purpose and terms, including its connection to selecting or keeping the caregiver, matter. Calling a transfer a gift or household contribution does not establish that it is lawful. A specific wage-sharing arrangement needs individual legal review. (Source 15)

Separate wage protections also matter. Under 29 C.F.R. § 531.35, employer-required wage returns or payments for an employer’s benefit can violate federal wage law when they reduce pay below required minimum wages or overtime. Healthcare anti-kickback restrictions and wage protections address different conduct; both can be relevant to a proposed giveback of earnings. (Source 16)

The appropriate policy response is to strengthen legitimate compensation for caregiving work. Family caregivers deserve better pay for the authorized care they provide. The responsibilities involved in helping a parent bathe safely or supporting an adult child with a disability do not become less valuable because the worker is a relative.

Federal Labor Department guidance already recognizes that family ties and paid employment can coexist. Under qualifying arrangements, a reasonable plan of care can define the paid employment relationship without turning every act of family support into employment. The guidance also explains that reducing the paid hours simply because the chosen worker is a relative can make that plan unreasonable for wage-law purposes. (Source 11)

Compensation policy should take the work seriously: its demands, the skills required, and the financial resources needed to sustain a caregiving household. Better wages should reach the caregiver as earnings for actual care, without an expectation that any portion be returned to secure the assignment. Care recipients’ uncovered needs should also receive attention through lawful benefits and support programs.

AARP’s findings support the broader case for helping caregivers, but the study does not measure CDPAP wage adequacy or establish a particular required increase. It would be inaccurate to assume that every CDPAP worker incurs the national average expense or that all reported caregiving costs should be reimbursed through an hourly wage. The research identifies financial pressure; the argument for better CDPAP pay is a policy position informed by that wider concern. (Source 2)

Families seeking assistance can contact NY Connects at 800-342-9871 for information and referrals involving long-term services, benefits, home care, and caregiver resources. Its information service is available regardless of income or insurance, although eligibility and payment arrangements for referred services vary. (Source 6)

In New York City, NYC Aging offers access through community organizations to caregiver counseling, training, support groups, respite, and limited financial assistance. Social adult day care may also provide respite for some families. Asking about these resources can help a household identify support beyond the paid care hours in a particular program. (Source 7)

A sustainable care arrangement must account for the person receiving assistance and the person providing it. New York should support CDPAP through fair compensation for authorized work, clear guidance on family financial arrangements, and practical help with uncovered needs. Families should be able to care for loved ones without treating their own financial security as an expendable resource.

Sources — full URLs

1. AARP: Caregiver Out-of-Pocket Spending Rises 59 Percent https://www.aarp.org/caregiving/financial-legal/caregiving-out-of-pocket-cost-study/

2. AARP Research: 2026 Caregiving Out-of-Pocket Costs Study https://www.aarp.org/pri/topics/ltss/family-caregiving/family-caregivers-cost-survey-2026/

3. AARP press release, October 28, 2026 https://www.aarp.org/press/releases/2026-10-28-aarp-family-caregivers-out-of-pocket-costs-jump-almost-60-in-five-years-to-more-than-11500-annually/

4. Medicare: Long-Term Care https://www.medicare.gov/coverage/long-term-care

5. Medicare: Home Health Services https://www.medicare.gov/coverage/home-health-services

6. ACCESS NYC: NY Connects https://access.nyc.gov/programs/nyc-ny-connects/

7. NYC Aging: Caregiving https://www.nyc.gov/site/dfta/services/caregiving.page

8. NYSDOH: Consumer Directed Personal Assistance Program https://www.health.ny.gov/health_care/medicaid/program/longterm/cdpap/index.htm

9. NYSDOH: Statewide CDPAP Fiscal Intermediary https://healthweb-back.health.ny.gov/facilities/long_term_care/reimbursement/cdpap/

10. PPL: New York CDPAP Frequently Asked Questions https://pplfirst.com/new-york-cdpap-frequently-asked-questions/

11. U.S. Department of Labor: Paid Family or Household Members https://www.dol.gov/agencies/whd/fact-sheets/79f-flsa-publicly-funded-programs

12. Federal Anti-Kickback Statute, 42 U.S.C. § 1320a-7b https://uscode.house.gov/us/usc/119-124/t42/s1320a-7b/

13. New York Social Services Law § 366-d https://www.nysenate.gov/legislation/laws/SOS/366-D

14. 42 C.F.R. § 1001.952(i): Employee Safe Harbor https://www.ecfr.gov/current/title-42/chapter-V/subchapter-B/part-1001/subpart-C/section-1001.952

15. HHS-OIG: Questions Regarding Fraud and Abuse Authorities https://oig.hhs.gov/faqs/general-questions-regarding-certain-fraud-and-abuse-authorities/

16. 29 C.F.R. § 531.35: Free and Clear Wage Payments https://www.ecfr.gov/current/title-29/subtitle-B/chapter-V/subchapter-A/part-531/subpart-C/subject-group-ECFRd42c2e4b995d7cd/section-531.35