I'm my mom's POA and I'm wanting to become her paid caregiver, but social services told me they heard I couldn't do that. Is this true?

I know that in Oregon you can not be a persons guardian and have the state pay you as their caregiver. It is considered a conflict of interest.

Not the exact same circumstances as you asked but similar enough, I think. As GardenArtist recommend, to get the actual facts for your situation in your state - seek out a reliable attorney who specializes in Elder Care.

Medicaid won’t pay you as a her family caregiver since you are her POA. That is probably why the person at social services told you that. But you weren’t planning to be paid by the state were you?

If you want a "legit" answer, the best way is to consult an attorney.    What someone "heard" isn't reliable, but it's good that it prompted you to address the issue.

Someone who has control over someone else's finances has an opportunity to abuse the situation through self enrichment.   Whether or not that's a hidden intent is beside the point.  The opportunity is there, and can create questions in the minds of anyone who has an interest in both individuals' situations.

E.g., you state that your mother has age-related decline as well as depression and cancer.   Those are volatile medical and psychological combinations, and could predispose someone to relying on someone else, who potentially could exploit those factors.  

If your mother is able to sign a caregiver agreement, consider that, but do consult an elder law attorney first, and confirm that the attorney has experience in drafting caregiver contracts.