The day has arrived when you understand that your aging parent can no longer manage on their own. You may have decided this due to concerns about their safety, health, emotional well-being, or a combination of all of these. However, since you are not in a position to care for your parent full-time due to family, work, or other commitments, you know you need the help of a caregiver so they can age in their own home with as much independence, safety, and dignity as possible. The most pressing question may be, how to find an affordable caregiver who you casa trust. Should you use an in-home caregiver agency or hire a private caregiver? What’s the difference? What are the pros and cons? Let’s define them and go over the differences so you can make an informed decision.
What is an In-home Care Agency?
An In-home care agency is a licensed business that screens, employs, and trains in-home caregivers. After completing a care agreement with a family, the agency provides one or more caregivers who can meet the client’s specific needs. Services may include helping with the activities of daily living, such as bathing, dressing, and using the bathroom, companionship, transportation, and errands, meal preparation and/or assistance eating, laundry, housekeeping, and medication reminders. Specialized services may include memory care and medication assistance. Once an agreement is entered, the caregiver service is guaranteed. So, if for any reason a caregiver doesn’t work out for a family, or leaves the company, the caregiver is replaced. All employer taxes and insurances are managed and covered by the agency.
What is a Private Caregiver?
A private caregiver is employed directly by the family. There is no intermediary agency between the client and the caregiver. Private caregivers are usually found in online service listings such as Craigslist, by their response to a newspaper or other ad, or by a referral or recommendation. It is up to the family to do background checks, request and check references and verify experience. Private caregivers are not supervised or licensed, so they may or may not be qualified to provide personal care, medication assistance, or memory care. If you hire a private caregiver, you must take on the responsibilities of being their employer or use a third-party payroll management service to handle taxes, insurance, and the like.
Now that we know the difference between an agency caregiver and a private caregiver, we can explore some of the pros and cons.
Caregivers from in-home care agencies usually cost more than private caregivers. Private caregivers are paid anywhere between 20% – 30% less than in-home care agencies, and this is consistent throughout the United States. This may sound like a significant cost difference, but on closer inspection, there are hidden costs involved in being an employer, consider the time you must take during the hiring process, overseeing the caregiver’s work, and arranging payments to the caregiver. You also must decide whether to take on or hire a 3rd party service to manage payroll, Social Security, and other taxes, which in Maryland tends to be around 30% of than the hourly rate. When using an agency, you pay an hourly fee, and they take care of all the employer-related responsibilities.
Types of Care
The services needed for in-home care will vary from family to family. Private caregivers can in most cases provide assistance with the essentials of daily living as outlined above. However, if a client has an age-related illness or other health issues, an independent caregiver may lack the professional training to document symptoms and handle emergencies. Because of the responsibilities and liabilities that are associated with medical care, many families in this situation prefer to use an in-home care agency.
Quality of Care
An agency with awards, high ratings, and several years in business can attribute its success to the quality of service and care it provides. This is made possible by a comprehensive employee training program that emphasizes the importance of service excellence. While there are private caregivers that provide excellent service as well, their service is not guaranteed. If the service provided by an agency caregiver is not up to par, the agency can seamlessly replace the individual with someone else.
Legal Considerations, Taxes & Deductions
Families used to have the option of hiring a private caregiver as an independent contractor (which meant they would not be responsible for payroll taxes, withholdings, etc.). However, this is no longer an option since the IRS has recently ruled that caregivers must be classified as employees. Paying a private caregiver “under the table” in order to avoid the hassle of dealing with payroll and taxes is not only illegal, but it also prevents families from receiving possible tax benefits. An in-home caregiver agency takes the guesswork, time, liability, and hassle out of hiring a caregiver.
In conclusion, while it may at first seem cheaper and easier to hire a private caregiver, the pros of using an in-home care agency usually outweigh the cons. Families enjoy different levels of peace of mind knowing that their loved one is receiving the best care possible from a screened, insured caregiver, that they have a caregiver guarantee, and that time-consuming screening and interviewing, hiring and training and payroll and other legal obligations are completely taken care of. Freedom from these worries will give you and your family more quality time to spend with your aging loved one, which is important to cherish as they live out their ‘golden years.’