In most of the country, when a parent qualifies for Medicaid long-term care, the practical answer to “who provides the care?” is one of two things: an aide dispatched by a state-contracted agency, or a bed in a nursing facility. The adult child who has been driving across town to manage medications, sit through doctor’s appointments, and cover the Saturday shower routine usually does it for free — on top of a full-time job.

Wisconsin built a different system. Under the state’s IRIS program — Include, Respect, I Self-Direct — a Medicaid-eligible adult who meets nursing home level of care can be handed a monthly budget and the authority to spend it. They hire their own workers. They set the schedule. And in the great majority of Wisconsin families, the worker they hire is a son, a daughter, or a sibling who was already doing the work unpaid.1 This piece walks through how the program actually operates, what the budget covers, how a family member becomes a paid IRIS worker, and the four things to settle before applying.

The two-track system: Family Care and IRIS

Wisconsin long-term-care policy has, since 2008, run on two parallel tracks operating under the same statutory authority. The Family Care track delivers services through a regional managed-care organization (MCO) that assembles a provider network and assigns a case manager. The participant doesn’t hire workers; the MCO does. IRIS is the consumer-directed alternative. Same eligibility, same federal § 1915(c) waiver authority, fundamentally different control structure.2

Every Wisconsin adult who qualifies for state-administered long-term care must choose between them at the point of enrollment. The ADRC is required to explain both options neutrally. A participant can switch between Family Care and IRIS without losing eligibility — what the state calls the “money follows the person” principle. The choice isn’t permanent.

Who qualifies for IRIS

IRIS eligibility has two parts that both have to be met:

  1. Financial Medicaid eligibility. The applicant must qualify for Wisconsin Medicaid under the Medicaid-LTC asset and income rules. The 2026 single-applicant asset limit is $2,000 in countable assets (the home, one car, household goods, and a modest burial fund are exempt). Unlike income-cap states like Texas, Wisconsin uses a “medically-needy” spend-down for applicants whose monthly income exceeds the cap — the excess is paid toward the cost of care rather than routed through a separate trust.
  2. Nursing home level of care (NHLOC). Determined through the Wisconsin Adult Long-Term Care Functional Screen, administered by the local Aging and Disability Resource Center. The screen covers activities of daily living, instrumental activities, cognitive function, and behavioral/medical complexity. A finding of NHLOC means the state has determined the applicant could appropriately be placed in a nursing facility — not that theyshould be, just that the level of need is present.4

Either piece can be the gating factor. A frail parent with substantial assets needs to navigate the financial side first (often with elder-law counsel); a parent at the low- asset end whose needs are still primarily companionship may not score NHLOC on the Functional Screen and would be directed instead to community programs through the local Area Agency on Aging.

How the budget actually works

Once a participant is enrolled in IRIS, the Functional Screen Cost Capture (FSCC) algorithm generates an individual monthly budget. The exact number varies considerably — from under $2,000/month for participants with modest needs to $10,000+ for participants with high acuity — and the 2026 statewide average runs roughly $4,500–$6,500/month.4 The participant and their assigned IRIS Consultant Agency (ICA) then build a plan within that budget.

The plan can include, among other categories:

The participant chooses, with ICA guidance, how to allocate the monthly budget across these categories. A typical older- adult IRIS plan might spend 70% on self-directed personal care (a family caregiver and one outside worker), 15% on supplies and transportation, and 15% held back for respite and unexpected needs.

How a family member becomes a paid worker

The mechanic that surprises most adult children is the employer-of-record structure. The participant is the employer. The family caregiver is the W-2 employee. The Fiscal Employer Agent (FEA), a state-contracted entity, functions as the payroll service — it handles tax withholding, files quarterly payroll returns, and issues the W-2 at year end — but the employment relationship itself runs between the participant and the worker.

  1. Worker enrollment. The family member completes a worker packet with the FEA: I-9 employment eligibility, W-4 withholding, direct-deposit setup, and a background check (a fingerprint-based criminal history check is standard for IRIS workers).
  2. Authorization.The participant and ICA agree on the worker’s hours and rate within the monthly budget. The authorization is documented in the IRIS plan and submitted to the FEA.
  3. Timesheets.The worker submits timesheets (typically bi-weekly, electronic). The participant or participant’s representative approves them. The FEA issues payment by direct deposit on the published payroll cycle.
  4. Annual W-2.The FEA issues a W-2 to the worker in January for the prior calendar year. If the worker lives with the participant, the difficulty-of-care payment exclusion under IRS Notice 2014-7 may apply — the W-2 still reports the income, but the worker excludes it on their federal return.5

The IRIS Consultant Agency: more than a case manager

Every IRIS participant is assigned an IRIS Consultant Agency (ICA). The ICA is the entity that helps build the monthly plan, confirms it stays within budget, navigates federal and state compliance, and steps in when something needs troubleshooting — a worker resignation, a budget adjustment after a hospitalization, a question about whether a particular purchase is allowable.6

ICAs are not interchangeable in practice. Each contracts with DHS but operates somewhat differently — in how available the consultant is, how proactively they review budget utilization, how they handle questions about edge-case spending. Participants are assigned an ICA at enrollment but can request a change if the fit is poor. The right ICA consultant is, in our reading of family interviews, the single most important variable in whether IRIS works smoothly for a particular family.

The four questions to settle before applying

For a family considering an IRIS application in 2026, these are the questions worth working through with the local ADRC and, where helpful, an elder-law attorney:

  1. Does the parent financially qualify, and if not, what does the path look like?Wisconsin’s asset limit is $2,000 for a single applicant. A community- spouse picture changes the math materially (the well spouse retains a Community Spouse Resource Allowance of up to $157,920 in 2026). For applicants over the asset limit, planning options include qualifying-asset annuities, exempt-asset conversions, and spend-down on legitimate care needs. Each carries look-back implications under the federal 60-month look-back period.
  2. Will the Functional Screen produce a finding of NHLOC?The Functional Screen is administered by ADRC staff and is not a rubber stamp. Families occasionally find that their parent — whose needs feel obvious in the day-to-day — doesn’t score at NHLOC because the screen captures objective functional limitations rather than the family’s subjective burden. If the result is borderline, ask the ADRC about reassessment after a change in condition.
  3. Who will be the paid worker(s)?Most IRIS plans for older adults mix one family worker and one or two outside workers. Putting the entire authorized hours on a single family member usually fails — the workload is unsustainable and respite becomes impossible. A useful planning exercise: write out a week’s schedule of care hours and ask who covers which blocks.
  4. Family Care or IRIS?A participant with stable, predictable care needs and a family member ready to coordinate often finds IRIS less administratively burdensome than the perceived complexity suggests — and far more flexible. A participant with complex medical needs, no available family coordinator, or a strong preference for someone else to handle scheduling may be better served by Family Care’s MCO model. Neither choice is permanent.

What to do this quarter

The sequence to follow, if a parent appears to be a plausible IRIS candidate:

The bottom line

Wisconsin IRIS is, on the merits, one of the most family-friendly long-term-care funding structures in the country. The combination of a monthly budget, the right to hire family members, an assigned consultant who helps plan the spending, and the federal difficulty-of-care exclusion for co-resident workers is unusual — a similar combination exists in only a handful of other states. The adult child providing the bulk of a parent’s care unpaid is, in Wisconsin, often eligible to be paid for that same work through their parent’s own Medicaid budget. The barrier isn’t the policy. It’s knowing the option exists, calling the ADRC, and walking through the Functional Screen patiently enough to confirm what everyone in the family already knows: that the care need is real, and that the person providing it deserves to be paid.