Can a Family Member Get Paid to Be a Caregiver in Hawaii?

Yes, a family member can get paid to be a caregiver in Hawaii, usually through one of three channels: Hawaii Medicaid’s Home and Community-Based Services waiver, which lets certain relatives be hired under a consumer-directed option; two U.S. Department of Veterans Affairs programs for families caring for eligible veterans; and, when the legislature funds it, the state’s Kupuna Caregivers Program. Which one fits depends on who needs care, their medical and financial situation, and your relationship to them.

Getting Paid Through Hawaii Medicaid

Hawaii’s Med-QUEST Division runs a Home and Community-Based Services waiver for people with intellectual and developmental disabilities. The waiver includes a consumer-directed option: the person receiving care hires their own providers and pays them with Medicaid funds. Family members can be those providers.¹

Not every relative qualifies. Spouses cannot be paid for waiver services. Parents and legal guardians of minor children are also excluded. For adult care recipients, eligible relatives include parents, siblings, adult children, grandparents, in-laws, and step-family members. Hawaii also recognizes hanai relatives, the Hawaiian tradition of caring for someone without formal adoption.¹

Even eligible relatives face additional scrutiny. The state authorizes family-provided waiver services only when the family member cannot provide care without reimbursement, is the most qualified available provider, or is the only available provider. Family caregivers hired through the consumer-directed model are held to the same monitoring and supervision requirements as non-relatives.¹

What the Care Recipient Must Qualify For

The person receiving care has to meet both medical and financial tests. Medically, the state requires a “nursing facility level of care,” meaning they need help with daily tasks like bathing, dressing, or eating, or they have cognitive impairments serious enough to need ongoing supervision.²

Financially, in 2026 a single individual’s countable assets cannot exceed $2,000.³ Monthly income cannot exceed $2,982, the federal special income level (300% of the federal benefit rate) for 2026.⁴ A Qualified Income Trust may still allow someone over the income cap to qualify. Applications go through the Hawaii Department of Human Services and include a functional assessment of the care recipient’s needs.

Pay and Requirements for Medicaid Caregivers

Family caregivers paid under the waiver typically help with bathing, dressing, meals, and mobility. Hawaii’s minimum wage rose to $16.00 per hour on January 1, 2026, which sets the floor for any caregiver pay.⁵ The actual rate depends on the service and arrangement, but it must meet at least that floor.

Caregivers usually need to pass a background check that includes criminal history and abuse registry screening. Some programs require CPR and first aid certification. Training requirements vary by service, and the state expects family caregivers to demonstrate competency in the specific tasks they provide.

VA Programs for Family Caregivers of Veterans

Two VA programs can pay a family member caring for a qualifying veteran.

Program of Comprehensive Assistance for Family Caregivers

PCAFC pays a monthly stipend to the primary family caregiver. The veteran must have a VA disability rating of 70% or higher, be enrolled in VA health care, and need at least six continuous months of in-person personal care services. The caregiver must be at least 18 and either a family member of the veteran or someone who lives with them full-time.⁶

The stipend is tied to the Office of Personnel Management’s GS-4, Step 1 salary for the veteran’s locality, divided by 12 for a monthly figure. At Level 1, the caregiver receives 62.5% of that monthly amount. At Level 2, reserved for veterans the VA finds unable to sustain themselves in the community, the caregiver receives 100%.⁷ Hawaii’s locality adjustment is among the highest in the country, so stipends here run larger than in most states. Primary family caregivers may also receive CHAMPVA health coverage, mental health counseling, and respite care.

Veteran-Directed Care

Veteran-Directed Care works differently. Rather than a stipend, the VA gives the veteran a flexible budget to purchase their own care, including hiring a family member at an hourly rate. The veteran or their representative manages the budget, chooses the provider, and sets the schedule.⁸ It is open to veterans enrolled in VA health care who need help with daily activities, but not every VA medical center offers it. Check with the local VA facility in Hawaii before applying.

Kupuna Caregivers Program

Hawaii’s Kupuna Caregivers Program helps working families afford care for older relatives, but it does not pay the family caregiver directly. The program provides up to $70 per day (up to $210 per week) toward services like adult day care, in-home personal assistance, respite care, and transportation, and those funds go to contracted service providers.⁹ The idea is to keep the family caregiver employed by subsidizing professional help while they are at work.¹⁰

The care recipient must be a U.S. citizen or lawful permanent resident, at least 60 years old, and not living in a long-term care facility. They cannot already be receiving comparable home and community-based services such as Medicaid HCBS. They must also have impairments in at least two activities of daily living, two instrumental activities of daily living, one of each, or substantive cognitive impairment requiring substantial supervision.¹¹

The family caregiver applying must be an “employed caregiver” under state law: working at least 20 hours per week for one or more employers, or self-employed. The caregiver does not have to live with the care recipient but must be providing direct care.¹¹

One important caveat: the program depends on annual state funding, and availability has been inconsistent. Call the Aging and Disability Resource Center at (808) 643-2372 before investing time in an application.

Taxes on Caregiver Pay

Payment creates tax obligations many families overlook. The IRS generally treats caregivers as household employees of the person they care for, because the care recipient controls the work and the care happens in their home.¹²

When a family caregiver earns $3,000 or more in cash wages during 2026, the employer (the care recipient or their representative) must pay Social Security and Medicare taxes: 6.2% for Social Security and 1.45% for Medicare from each side. The employer withholds the employee’s share and reports wages on a Form W-2.¹³ Federal income tax withholding is not required unless the caregiver asks for it and the employer agrees, but the caregiver still owes income tax on the earnings at filing.¹⁴

Some family relationships change the picture. If the caregiver is the care recipient’s spouse, a child under 21, or a parent in certain circumstances, the employer may not owe employment taxes, though the wages still need to be reported on a W-2.¹² Where the caregiver is not treated as an employee, such as a family member receiving payments from a state agency without being in the business of caregiving, the income is still reportable but may not carry self-employment tax; it goes on Schedule 1 of Form 1040 rather than Schedule C.

VA caregiver stipends under PCAFC are generally excluded from gross income. Because the tax treatment turns on the payment source and the family relationship, a tax professional is worth consulting before the first filing.

How to Apply

Medicaid HCBS waiver: Apply through the Hawaii Department of Human Services, Med-QUEST Division. The process includes a financial eligibility determination and a functional assessment. If approved, ask specifically about the consumer-directed option so a family member can be paid.
Kupuna Caregivers Program: Call the Aging and Disability Resource Center at (808) 643-2372 to check current availability and apply. The Executive Office on Aging coordinates the program; the ADRC handles eligibility determinations.⁹
VA caregiver programs: Visit caregiver.va.gov or call the VA Caregiver Support Line at 1-855-260-3274 (Monday through Friday, 8:00 a.m. to 8:00 p.m. ET). For PCAFC, the veteran and prospective caregiver apply together, and the VA conducts a home care assessment.⁶

Timelines vary. Medicaid applications can take several weeks, and the VA process involves clinical evaluations that stretch things further. Starting the paperwork before the situation becomes urgent gives you the best chance of having support in place when you need it.

1
Hawaii Department of Health. Application for 1915(c) HCBS Waiver
2
Hawaii Department of Health. Application for 1915(c) HCBS Waiver
3
Med-QUEST Division. 2026 MAGI and MAGI-Excepted Income Standards Chart
4
Medicaid.gov. January 2026 SSI and Spousal Impoverishment Standards
5
Hawaii Department of Labor and Industrial Relations. Hawaii Minimum Wage Increases to $16.00 on January 1
6
Department of Veterans Affairs. Program of Comprehensive Assistance for Family Caregivers
7
U.S. Department of Veterans Affairs. PCAFC Monthly Stipend Fact Sheet
8
Department of Veterans Affairs. Veteran-Directed Care
9
Justia. Hawaii Code 349-17 – Kupuna Care Program
10
Hawaii Executive Office on Aging. State Launches Landmark Kupuna Caregivers Program
11
Justia. Hawaii Code 349-16 – Definitions
12
Internal Revenue Service. Family Caregivers and Self-Employment Tax
13
Internal Revenue Service. 2026 Publication 926 – Household Employer’s Tax Guide
14
Internal Revenue Service. Tax Situations When Taking Care of a Family Member