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Costs of Senior Home Care

More families are considering the possibility of privately hiring senior home care for someone it their family as a way to help their loved ones age in place in a safe and happy environment. This is uncharted territory for most people, and adult children who may have hired nannies to care for their children years ago wonder what they need to consider when hiring  senior home care assistance.

Research Costs for Senior Home Care

There are three general pricing models, but endless variations. Here’s a start:

Agency caregivers

When you hire a caregiver through a senior care staffing agency, the caregiver is an employee of the agency. The agency handles payroll, taxes, insurance and scheduling. Expect to pay $18 – 30 per hour to the agency for the typical senior caregiver – costs vary considerably by geography. The actual caregivers receives about 50-60% of the agency fee in salary. The balance covers agency administrative expenses, payroll taxes, insurance and training, as well as a profit for the agency owner.

Registry or staffing agency caregivers

Registry and staffing agency caregivers are recruited and scheduled by a private Registry but are paid directly by the hiring family.  Families may also engage the registry to process the net payroll. The registry collects a fee for their services either on an hourly or daily rate model. Because you pay the caregiver, or outsource the payroll to the registry, in most states you become the employer, and therefore assume payroll tax and workers compensation insurance responsibilities. Be very careful here, many registries will tell you “don’t worry, we do the payroll.”

The critical question is whether the Registry is paying the caregiver’s employment taxes. If the answer is no, the family receiving the care may be legally responsible for paying these taxes. Increasingly states, are requiring that registries fully disclose this to hiring families.

Private senior care hiring – going on your own.

This is the most economical means, but places considerable scheduling, administrative and record keeping responsibilities on the family. Expect to pay $12 – 20 per hour, and factor in the costs of payroll taxes and insurance. Still, hiring privately costs about 20% less than hiring through an agency, even after outsourcing payroll and tax services.  Important as well is that this arrangement means the caregiver earns about 20% more than she would through an agency.  This has a positive impact on worker satisfaction and reduces employee turnover.

Learn more about privately hiring senior home care.

Other Resources:

Companionship Care: Minimum Wage and Overtime by State
Overtime Rules for Senior Caregivers
Payroll for Privately Employed Senior Caregivers
FAQ: Privately Employed Senior Caregivers

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