"received care giver payments ( medicaid waiver) for her son that lives in his own apartment."

Is the child the employer or an agency or the State/County, on the reporting form? Where do you see something telling you this qualifies for medicare "difficulty of care" waiver? There are a couple of tests for eligibility, but there are some exceptions for working for your own children under 21 as household help (Medicare and Social Security exemptions). These are some standard qualifiers for 2014-7, though:

"under a state Medicaid Home and Community-Based Services waiver program"

"depend on the nature of the payments and the purpose and design of the program"

"to receive care in the individual care provider's home"

https://www.irs.gov/irb/2014-04_IRB#NOT-2014-7

https://www.irs.gov/individuals/certain-medicaid-waiver-payments-may-be-excludable-from-income