Study Shows the Impact of Paying Family Members for Care

Paying family members of patients for the care they give decreases overall Medicaid expenditures. And it improves outcomes.

That’s the takeaway from a major study of caregivers and their loved ones, published earlier this year by the National Bureau of Economic Research (NBER). The study, which reviewed the results of an earlier government-run evaluation program, concludes that there is a causal relationship between paying family caregivers directly, rather than putting those dollars toward traditional agency-based care.

The results are striking. Controlling for a multitude of factors, when the treatment group (those that were able to pay for care from non-Medicaid home care agencies) paid family members who were involved in care, the likelihood of an ER visit was reduced by 30%, and all hospital use reduced by 50%. Rates of UTI, respiratory infection, and bedsores were reduced between 30% and 50%. Shortness of breath was reduced by 76%. That’s when compared to the portion of the control group that utilized uncompensated family members for care.                                                             

Undervalued, Misunderstood

It’s widely known that family caregivers provide hundreds of billions of dollars’ worth of unpaid care every year. Some estimates peg the value at over $500 billion, which puts it nearly on par with total annual Medicare spending. Though undervalued, and under-recognized by institutional care providers, Seniorlink has always believed that family caregivers have great potential to improve the care they give through coaching, support, and financial assistance. The outcomes described in this study are a fantastic validation of that hypothesis.

What’s more, the results underscore data we’ve collected on Seniorlink’s Caregiver Homes program, which compensates caregivers with a stipend. In the program, the rate of falls per 1,000 patient hours (and by proxy, hospitalizations due to falls) by consumers is 3.5x less than that of most skilled nursing facilities (industry average). If one looks at nursing facilities specializing in elder care, which serve a similar population to the one studied in the Caregiver Homes program, the improvement in falls rate is even more pronounced.

While our own data makes a solid case for keeping care at home, it doesn’t isolate the payment aspect of the program. That’s why the NBER study is enlightening: both the control and treatment groups in the study had high rates of family members participating in care. And yet when isolating the treatment group that received payment, the results are clearly significant.

Valuing the Undervalued

The study's authors note that, since they found a causal relationship, this model could be replicated to reduce spending and improve outcomes – the double-headed holy grail of healthcare reform. We’re already putting this hypothesis into action and have been for years. By helping to realize the potential of family caregivers, we can see real results at scale.