Medicaid Homecare Waivers Remain Safe—for Now—Despite Looming Federal Cuts

No U.S. state has cut or restricted funding for Medicaid Homecare Waivers for older adults or their family caregivers since the One Big Beautiful Bill Act was introduced. The law's work requirements, set to begin no earlier than 2027, explicitly exempt family caregivers, and as of February 2026, no state has taken steps to reduce support. Yet concerns remain about the future of these vital services.

Medicaid's home and community-based services help millions of low-income older adults with daily tasks. These waivers also fund respite care, giving family caregivers short-term breaks. All responding states allow payments to family and friends, with 44 permitting payments to legally responsible relatives, though the full impact of these policies is still uncertain.

The One Big Beautiful Bill Act (H.R. 1) is expected to slash federal Medicaid spending by $911 billion over the next decade. This could push states to trim optional benefits, potentially forcing older adults into care homes or increasing reliance on unpaid family members. Meanwhile, a shortage of paid caregivers—worsened by labor gaps and restrictive immigration rules—adds further pressure.

Family caregivers themselves often depend on Medicaid for their own health insurance. While exempt from new work requirements, unclear documentation rules create confusion. Without stable support, the economic, physical, and emotional strain on families could grow.

Federal cuts threaten the stability of Medicaid's homecare services, which millions rely on. States may face tough choices as budgets tighten, risking reduced support for older adults and their family members. The long-term effects will depend on how states balance funding and care needs in the years ahead.