The most common and most likely answer to this crossword clue is the 4 plus 7 letter word SICK BENEFIT
I've seen this crossword clue in The Daily Telegraph
S
I
C
K
B
E
N
E
F
I
T
More clues leading to the result SICK BENEFIT
Buddy explains!

The straight part
We know that "Money for ill people" is the straight/definition part of the clue. The straight part is often a synonym or definition, in this case money for ill people = sick benefit.The cryptic/wordplay part
In cryptic crossword there's often an wordplay/cryptic part as well.This part involves a more complex hint, such as an anagram, homophone, hidden word, etc.
Sadly, We don't have an explanation for this specific crossword clue yet.