It’s a common experience: Your loved one needs more help but wants to stay home.
One user on AgingCare’s forum succinctly expressed the challenges families face when deciding how to provide home care:
“Are there disadvantages to hiring on our own? Would a caregiver rather be hired through an agency? What are the perks?”
There’s no one-size-fits-all solution when it comes to choosing an independent home caregiver over an agency caregiver. Understanding the similarities and differences between these options and assessing the specifics of your own situation will help you make the right decision.
What are home care agencies?
Home care agencies are businesses that employ caregivers and contract them out to families. They take on the managerial responsibilities of hiring and coordinating care, leaving you with more free time and less paperwork.
Here’s what you should know about home care agencies:
You’re the customer. When working with a home care agency, you’re the customer and caregivers are agency employees. You’re not responsible for any management tasks, including the tax paperwork for their employees. An agency’s administrative staff are experienced in helping people in your situation and should have many resources at their disposal to ensure your needs are met.
They’re licensed, insured, and bonded. To legally operate, the agency needs to get a home care license from their state and fulfill any state-required training and background checks. This means they must follow state regulations regarding home care. Agencies also provide workers’ compensation, which covers any costs related to injuries, illnesses, or damages the caregiver might sustain while working for you. Agencies are often bonded, which means you can file a claim to get money if the agency doesn’t provide the agreed-upon services, or if your property is damaged or stolen.
They set policies and procedures to ensure high-quality care. Employees typically undergo background checks and drug screenings, and agency coordinators may conduct regular, on-site quality checks. Agencies also thoroughly review their employees by confirming their certifications and experience, checking their references, and providing ongoing training and education.
Agencies coordinate schedules. Agencies will work to make sure that any last-minute cancellations don’t result in a period of time without care. Some agencies allow families to have a say in which caregiver they work with, but caregivers may be on a rotating schedule and change based on availability.
Agencies have more resources. They typically employ more people than just caregivers, such as coordinators and managers. Some agencies also employ certified nursing assistants (CNAs) and care counselors. If you need more involved medical or dementia-related care, an agency may be able to help you keep everything organized.
They tend to be more expensive. An agency’s hourly rate is almost always more expensive than an independent caregiver’s, but that’s because the agency staff handles all administrative tasks on your behalf. For many families, the built-in time savings and liability protections may be worth the higher cost.
They often have minimum hour requirements. Because they pay for caregivers’ transportation costs, agencies tend to have minimum hour requirements to make the travel time worth it. For example, you may only want or need two hours of care on a given day, but the agency may require a three-hour minimum to schedule the visit.
Service areas may be limited. Unless an agency is part of a larger company with more than one location, services are typically only available in specific areas, such as one city or county.
You can find agencies near you by searching AgingCare’s home care directory or by contacting one of our trained Care Advisors, who will discuss your needs and arrange interviews with local providers free of charge.
What is an independent home caregiver?
While they often provide the same type of care as agency caregivers, an independent home caregiver is a professional who isn’t affiliated with an agency. They may have worked with an agency in the past but now work as an independent household employee.
These are the key points to know about independent caregivers:
You’re their employer. Unlike with an agency, you and your family take on all administrative and managerial duties. While caregivers are hired in a similar way as freelancers, they’re technically household employees. When looking to hire an independent caregiver, you conduct interviews, background checks, drug screenings, and reference checks. You’re also responsible for monitoring the independent caregiver’s performance, addressing complaints, and terminating contracts.
They may not be licensed or insured. Laws regulating senior care differ from state to state, so independent caregivers may not need any special licensing or certifications. As an employer, it’s up to you to confirm and assess a caregiver’s qualifications. You’re also responsible for carrying liability insurance and workers’ compensation insurance to protect your family and your employee.
There’s more financial and decision-making freedom for both parties. When caregivers work independently of an agency, they often have more flexibility, freedom, and better pay. They can choose their clients and change jobs if a family isn’t the right fit. Some families may also find it beneficial to be able to exercise more control over who’s caring for their loved ones and negotiate their rates.
Hiring may be difficult. Because independent caregivers aren’t affiliated with an agency, families are responsible for writing and posting a job description or actively seeking out candidates. It’s also up to families to find a replacement if the caregiver gets sick or needs time off. Word-of-mouth is a powerful tool, and many families find their caregivers through personal recommendations. It’s worth asking your friends and family if they know of any great caregivers in the area. However, the internet has made it easier to find independent caregivers who may be outside your personal network.
How to choose between independent home care and an agency
There’s no silver bullet when it comes to choosing between an independent caregiver and an agency. Review the following section for a breakdown of the pros and cons for independent caregivers and home care agencies.
Understand the type and amount of care offered
While agencies and independent caregivers may offer the same services, there are some nuances you should consider.
Agencies:
Because agencies typically provide multiple levels of care, they can often continue to accommodate a client’s needs as they evolve.
Agencies have the staff and scheduling abilities to accommodate clients who need up to 24-hour care. However, families who need around-the-clock care may want to consider assisted living or nursing home options, as home care’s hourly pay structure makes it more expensive after a certain number of hours.
Independent caregivers:
Independent caregivers can often be flexible with the type of care they provide, as long as both parties agree.
Finding independent caregivers with medical training and certifications can be difficult.
One independent caregiver can only handle so much. As a client’s needs increase, the family may need to consider overtime pay or bringing on another independent caregiver.
Weigh the cost against the tax burden
Cost is a huge factor when choosing senior care. Many families are drawn to working with independent caregivers because they’re usually cheaper than agency caregivers. Families and private caregivers also benefit from the ability to negotiate prices, which helps everyone feel like they’re getting a better deal.
However, while hiring an independent caregiver usually means a lower price overall, you assume the financial duties and risks that an agency would take on.
When employing an independent caregiver, your financial duties include:
Taxes. Most people find taxes to be stressful and time-consuming. As an employer, you would be responsible for determining what federal and state taxes you and your employee are responsible for, calculating how much is owed, deciding how you’ll make payments, and submitting the proper forms to the IRS.
Insurance. Agencies typically carry liability insurance and workers’ compensation insurance (check if this is required in your state). If you employ a private caregiver, you should also carry this protection for both you and your caregiver in the case of destroyed property or an injury on the job. The cost of purchasing these protections may negate any savings associated with hiring an independent caregiver.
Consider reliability and relationship
One aspect of in-home care that families can expect from both agencies and independent caregivers is one-on-one care, which goes a long way toward creating a lasting, healthy relationship. During your hiring process, here are some other things to consider about creating a positive caregiving experience:
Mutual trust. Picking someone who “fits” with the family is key. Some families enjoy their relationship with their independent caregivers because they’ve chosen to work with each other personally. Agencies, too, understand that clients prefer to see familiar faces, and so they also do their best to send the same caregivers. Caregivers also enjoy consistency in which clients they see.
Good pay, loyalty, and security. Independent caregivers are often better paid than their agency counterparts, which helps foster a sense of loyalty to their clients. However, many agency caregivers may enjoy the security they get working for an agency, and stay with their agency for many years.
Reliability. Agencies provide a layer of scheduling protection. Consider the following situation: Your mother’s caregiver has called out sick at the last minute, right before you leave for a family vacation. Your agency immediately schedules a backup caregiver and informs you of the change, and you can leave for your vacation on time and with peace of mind.
Acknowledge how much time you have to be a manager
It’s more time-consuming to hire and manage an independent caregiver than to work with an agency. Decide whether you truly have the time to properly manage your caregiver.
If you hire a private caregiver, be prepared to spend time on the following duties:
Conducting your caregiver’s background check and drug screening
Confirming their credentials, especially if they’re a CNA or claim to have another certification
Contacting references, preferably from people who aren’t the caregiver’s family or friends
Managing payroll and tax withholdings
Completing performance reviews
Preparing backup plans for when the caregiver takes time off, calls out sick, or has an emergency (sometimes, you may be that backup plan)
Agencies take care of all of these tasks, saving you a considerable amount of time and hassle.
Making the right decision
The bottom line: While the cost of hiring an independent home caregiver may be lower, hiring through a home care agency may be safer and less time-consuming for you. But at the end of the day, a careful assessment of your loved one’s needs and your bandwidth will help you decide on the home care option that best suits your situation.
Sources:
Aging with Care: Your Guide to Hiring and Managing Caregivers at Home by Leslie Eckford and Amanda Lambert
Fast Stats Home Health Care (https://www.cdc.gov/nchs/fastats/home-health-care.htm)