Are you a Caregiver looking for App help? Click here

March 3, 2022
Home Care vs Home Health Care


The Origins of Organized Home Health Care 

Our ancestors most likely never saw a doctor, and rarely went to a hospital until it was a last resort. To understand why, you need to understand the times and gain perspective on the availability of care. Some communities had someone who was–or claimed to be–knowledgeable about the medicinal qualities of plants and other natural substances and created tonics to treat common illnesses and the ailment of the day. Others depended upon their family members or neighbors for care.  

These caretakers performed treatments of broken bones, cuts, and other injuries based upon techniques handed down from generation to generation. Early-day health practitioners came to the patient in most cases, visiting them in their homes and bringing with them the tools and treatments of their trade. The origins of the word “patient” stems from the English word meaning “one who suffers,” and there is little doubt that those who performed care of the sick and unwell did so in an attempt to relieve suffering. 

But even though patient care in the home was often a necessity due to a lack of healthcare facilities and professionals in earlier times, many patients and their families lacked the financial means to pay for services. This led some families to have no other choice but to barter with the caregiver. Still, there was a significant demand for these home health services, just as there is today. 

The root of home care, found in the practice of visiting nursing, had its beginning in England in the mid-1800s. During this time, William Rathbone, a wealthy businessman and philanthropist, with the help of Florence Nightingale, established a school to train visiting nurses in helping the “sick poor” in their homes. 

The demand for in-home health care led to the creation of nursing organizations toward the end of the 19th century, most of which were supported through donors. Even though, there was a struggle over having enough nurses to meet the demand for services, and systems were put into place to determine which patients warranted home health care, and for how long the organization would be able to care for chronically ill patients and remain financially viable. 

In 1909, the first home health insurance policy was offered by Metropolitan Life. Within the next 15 years, more than 1 million home health nursing visits were covered under the provisions of insurance policies, indicating the high demand for home health services. As healthcare improved, so did life spans. The danger of communicable diseases was no longer the major threat that it was at the beginning of the decade. 

When the Old Age Assistance Act, later known as Social Security, was passed, more families turned to private nursing homes to care for their chronically ill family members. Then in the 1930s and 40s, health care professionals sought a more cost-effective way to care for the chronically ill—those whose conditions were not likely to improve but did not require the full care provided by a hospital. The problem was that there was no option to help families pay for the services of home care, and it remained an issue revolving around the ability to pay until the 1960s. 


Federal Involvement in Home Health Care 

It was not until the 1960s that home health care was included in the Medicare, Medicaid, and Old Age Assistance Act.  Those creating the guidelines assumed there were family members who would be subsidizing home health care needs, so coverage for home health care was mandated only for medical necessity and provided intermittent care for those acutely ill patients who had been released from the hospital. By the 1990s, however, changes within varying levels of government allowed for expansion of home health services, but it did not last. The Balanced Budget Act of 1997 drastically slashed Medicare home benefits, and as a result, the number of patient visits were reduced, and 3,000 home care agencies shut down. 

Today, home health care often falls upon family members, and continues to be a major issue for policymakers, especially during election years. 

  1.  According to the National Association for Home Care and Hospice, home care began in the United States in the 1880’s. Approximately 12 million individuals currently receive care from more than 33,000 providers. 
  1. $103 billion was spent on home health care in the United States in 2018. It is projected to reach nearly $173 billion by 2026 according to the analysis from the Centers for Medicare and Medicaid Services (CMS) Office of the Actuary.  

“Home care organizations” include home health care agencies, home care aide organizations, and hospices. Some of these organizations are Medicare-certified, which allows providers to bill Medicare for reimbursement and some are Medicaid-certified. Some of the agencies are certified by the state in which they provide services and others are licensed through the state. Typically, certified agencies provide a higher level of medical care as compared to a licensed agency, but both certified and licensed agencies services can be paid through Medicare and Medicaid as long as the eligibility requirements are met.  For a list of the Licensed Home Care Services Agencies (LHCSA), like those servicing the state of New York click here.   



Similarities Between Home Care and Home Health Care 

To understand the difference between home care and home health care, it helps to know the similarities. Both offer: 

  • Care in the comfort and safety of your home 
  • Help for older adults to feel better and stay as independent as possible 
  • Assistance with daily tasks like bathing, dressing and grooming 
  • More affordable care than a hospital or facility care 


Differences Between Home Care and Home Health Care 

Some of the key differences between home care and home health care are: 


  • Home care provides “non-clinical” or “non-skilled” care by professional caregivers.  
  • Home health care provides “clinical” or “skilled” care by licensed nurses and therapists. 


  • Home care helps with everyday tasks like bathing, dressing, grooming, cooking, cleaning and transportation. It does not include medical care like nursing or therapy.  
  • Home health care services are more medical in nature. Home health aides are available to help with things like bathing, grooming and dressing until you are safely able to do them again or have a caregiver who can safely assist you. But the focus of care is skilled nursing and therapy. 


  • Since many people pay for home care expenses out of pocket, there are no eligibility requirements. However, if the agency providing service is a Licensed Medicaid agency and the patient meets eligibility, home care may be reimbursed by Medicaid.  
  • Home health care requires a doctor’s order. Patients must meet certain eligibility criteria. For example, they must have limited ability to leave their home and require assistance to do so. 


  • Home care continues as long as you want, based on your budget and needs. 
  • The home health team is made up of skilled professionals such as nurses and therapists. 
  • Family members and professional caregivers provide home care services. 
  • Home health care continues as long as your doctor certifies, and you continue to meet eligibility requirements. 


  • Home care can help patients 24/7, depending on the patient’s budget and needs.  
  • Home health care visits are typically a few hours per week, depending on the patient’s needs and doctor’s orders. 


  • Home care is typically paid directly by the patient or long-term care insurance. Medicaid may also cover home care as long as the individual meets specific requirements (see below) for details.  
  • Home health care is covered by Medicare, Medicaid and most private insurance plans for eligible patients. 

Since its creation in 1965, Medicaid has become the largest source of medical and health-related services for U.S. Americans with a low income and limited resources. Unlike Medicare, which is a federal run and funded program, Medicaid is funded by both federal and state governments but is run by individual states following federal guidelines. According to estimates of the Centers for Medicare and Medicaid Services (CMS), over 75 million people were enrolled in Medicaid in 2019.  

Medicaid will pay for in-home care in all 50 states, but the individual must meet specific eligibility criteria, see below. Traditionally, Medicaid has, and continues to pay for nursing home care for persons who demonstrate a functional and financial need. However, in-home care provides an alternative for seniors who require assistance to remain living at home but prefer not to relocate to nursing home residences. In-home care via Medicaid not only helps elderly persons to maintain their independence and age at home but is also a more cost-efficient option for the state than is paying for institutionalization. 

Many states allow Medicaid recipients to direct their own in-home care. This model of receiving services is called consumer directed care, participant directed care, cash and counseling, and self-directed care. It often allows care recipients to hire relatives as paid caregivers. Commonly, adult children can be hired and paid to provide care for their aging parents. Several states even allow one’s spouse to be hired. Learn more about getting paid to take care of a loved one

“Home care” may extend to a variety of settings outside of one’s own personal home. This may include the home of a friend or relative, an adult foster care home, or an assisted living residence. (To learn more about receiving personal care services and supports in assisted living, click here). The exact settings in which one can receive services depends on the state and the Medicaid program. 

To be eligible for Medicaid covered in-home care, specific eligibility criteria must be met as mentioned above and includes being a resident in the state in which one applies. There are also financial and functional requirements. Click here to view Medicaid eligibility test

To see state specific Medicaid eligibility requirements for reimbursed home care services, click on the state of interest below.  

New Hampshire 
New Jersey 
New Mexico 
New York 
North Carolina 
North Dakota 
Rhode Island 
South Carolina 
South Dakota 
Washington, DC 
West Virginia 


If you're ready to talk to us about how CareConnect can help to increase efficiency in your home care agency, complete the form below and one of our experts will contact you soon.


Home Care
Tech Tools
Artificial Intelligence