The $870 Billion Invisible Workforce
Put This Into Practice
CareCade makes it easy to implement best practices for home care management.
According to AARP's 2025 Caregiving in the US report, 63 million Americans now provide unpaid care to family members. That's a 50% increase since 2015.
The economic value of this unpaid labor: $870 billion annually.
For decades, this workforce has been invisible—unpaid, untrained, and unsupported. That's finally starting to change.
California Leads on Caregiver Wages
According to Paid.Care's 2026 analysis, California's In-Home Supportive Services (IHSS) program is implementing significant wage increases:
- Statewide minimum: $20/hour in 2026
- Los Angeles County: Considering $25/hour floor
- Scope: IHSS serves over 700,000 Californians
This matters because IHSS allows family members to be paid caregivers—including adult children caring for parents or parents caring for adult children with disabilities.
When you pay family caregivers fairly, you:
- Recognize work that was always happening
- Enable family members to reduce outside employment
- Improve care quality through dedicated attention
- Reduce reliance on scarce professional caregivers
Washington's Approach: WA Cares
Washington is taking a different but complementary path. The WA Cares Fund, launching July 2026, allows beneficiaries to:
- Pay family caregivers including spouses
- Hire professional home care aides
- Fund home modifications
- Cover transportation and meals
The benefit: up to $36,500 lifetime (adjusted for inflation).
While this isn't an ongoing wage like California's IHSS, it provides Washington families a new resource for compensating family care.
The Research on Paid Family Caregiving
Impact on Care Quality
When family members are compensated:
- Care hours increase - Caregivers can reduce other work
- Care consistency improves - Same person providing care daily
- Care knowledge deepens - Intimate understanding of the person's needs
- Care satisfaction rises - Both for caregiver and recipient
Impact on Caregivers
SHRM research shows working caregivers experience challenges affecting:
- Careers: 38% report negative impact
- Finances: 53% report negative impact
- Mental health: 48% report negative impact
- Physical health: 49% report negative impact
Paid family caregiving addresses the financial dimension directly and can ease career, mental, and physical impacts by reducing the dual burden of work plus unpaid care.
Impact on the Care System
The caregiver shortage is real—24 states are in "critical emergency" mode. The country needs 9.3 million direct care workers by 2031.
Family caregivers are a resource that:
- Already exists (63 million people)
- Already provides care (whether paid or not)
- Has intimate knowledge of care recipients
- Can scale more readily than the professional workforce
Recognizing family caregivers as part of the care workforce helps address the shortage.
The State-by-State Landscape
According to NPR's December 2025 analysis, policy support for family caregivers is expanding:
Paid Family Leave Programs
Several states are launching or expanding paid family leave specifically for caregiving:
- Funded through payroll taxes or state trust funds
- Provide wage replacement during caregiving periods
- Protect jobs during family care leaves
Long-Term Care Insurance
- Washington: WA Cares launches July 2026
- 7 other states considering similar programs (including California and New York)
Direct Payment Programs
- California IHSS: $20/hour minimum statewide
- Self-directed programs: Many states allow Medicaid beneficiaries to hire family members
- Consumer-directed options: Increasing flexibility in how care is provided
What This Means for Washington Families
Current Options
If your family member receives DDA waiver services, you may already have options:
- Self-directed care: Some waivers allow hiring family members
- Individual Provider program: Families can designate certain relatives as paid caregivers
- Respite services: Family members may provide paid respite in some circumstances
Check with your case manager about what's available under your specific waiver.
WA Cares Expansion
Starting July 2026, families with WA Cares benefits can:
- Pay qualified family members to provide care
- Supplement waiver services with family-provided care
- Cover care needs not addressed by formal services
This creates a new pathway for compensating family care that's separate from Medicaid.
The Combination Approach
For many families, the future may involve:
- Medicaid waiver services for formally authorized hours
- WA Cares benefits for supplemental family-provided care
- Professional caregivers for specialized needs
- Unpaid family support for informal help
Multiple sources combining to meet total care needs.
The Workforce Implications
For Professional Caregivers
Higher family caregiver wages raise the floor for everyone:
- When California pays IHSS workers $20/hour, agencies must compete
- When family caregivers are valued, professional caregivers are too
- Wage pressure flows through the entire care ecosystem
This is good for caregiver retention—the entire profession gains respect and compensation.
For Agencies
Paid family caregiving isn't competition—it's ecosystem expansion:
-
Families who can afford family caregivers may still need agency services for:
- Specialized care needs
- Respite for family caregivers
- Training and support
- Hours beyond family capacity
-
Agencies that help families navigate paid family caregiving build relationships
For Case Managers
The case manager role expands to include:
- Helping families understand paid caregiver options
- Coordinating between family and professional caregivers
- Monitoring care quality across provider types
- Supporting documentation for paid family care
The Economic Case
According to PwC's Future of Health report:
- Healthcare costs $5 trillion annually in the US
- 25% goes to administrative overhead
- Care is shifting from institutions to homes
Paid family caregiving makes economic sense:
| Care Setting | Approximate Daily Cost |
|---|---|
| Hospital | $3,000+ |
| Nursing home | $250-400 |
| Home care agency | $150-250 |
| Paid family caregiver | $100-200 |
The most cost-effective care is often delivered by family members who know the person best.
Challenges and Considerations
Quality Assurance
When family members provide paid care:
- How is care quality monitored?
- What training is required?
- Who provides oversight?
Programs like California's IHSS include training requirements and monitoring mechanisms. WA Cares will need similar structures.
Family Dynamics
Paying family members to provide care can complicate relationships:
- Who decides which family member gets paid?
- How are disagreements handled?
- What happens if the arrangement doesn't work?
Families navigating paid caregiving need support and clear expectations.
Tax and Employment Implications
Paid family caregivers may face:
- Employment tax obligations
- Income reporting requirements
- Benefits implications
- Labor law considerations
Understanding these requirements is important for both families and caregivers.
How CareCade Supports Paid Family Caregiving
Whether care is provided by professionals, family members, or both, CareCade ensures quality and accountability:
For Families Paying Relatives
- Visit verification - Documentation that care occurred
- Activity tracking - Record of what was provided
- Progress monitoring - Evidence of care impact
- Peace of mind - Transparency even for family-provided care
For Blended Care Teams
When professional and family caregivers work together:
- Unified view - All care visible in one place
- Care coordination - Communication between providers
- Consistent documentation - Same standards regardless of who provides care
- Gap identification - See what's covered and what isn't
For Family Portal Access
The Family Portal works regardless of who provides care:
- See when care happens
- Track activities and progress
- Stay connected across caregivers
- Maintain records for any payer requirements
Looking Ahead
The economics of family caregiving are changing:
- 63 million Americans already provide care
- $870 billion in annual unpaid labor
- California leading with $20/hour minimums
- Washington launching WA Cares benefits
- 7+ states considering long-term care programs
The invisible workforce is becoming visible. The unpaid work is becoming paid. The family caregivers who've always been essential are finally being recognized.
This is good for caregivers. It's good for care recipients. It's good for a healthcare system that can't hire enough professional workers to meet growing demand.
The caregiver shortage won't be solved by professional workers alone. Family caregivers are part of the solution—and they deserve to be compensated for the work they do.