Many of us will eventually face what it’s like to engage a professional caregiver to help care for the needs of someone we love. It’s not an easy task, and sometimes it can be frightening as we entrust the life of a loved one to someone outside of the family. The process of finding the right person to help our loved one securely stay in their home can seem like a daunting undertaking. Even though the benefits of having help are obvious, the idea of inviting a stranger to live in your home and take care of a loved one makes many people feel uncomfortable. On top of all these considerations, there is also the added stress of understanding the various financial and insurance arrangements of a caregiver scenario. Before you dive into that process, it’s helpful to have a firm grasp of what options are available to you and to know exactly how the system works. (And walking into it armed with knowledge can help reduce the stress of the process.)
The typical caregiver scenario involves either a caregiver “independent contractor” (“independent caregiver”) or a caregiver through an agency. In the independent caregiver scenario the caregiver effectively becomes the employee of the recipient. This relationship requires that a significant degree of liability and responsibility be assumed by the recipient, especially when it comes to risk management (insurance) and managing payroll and tax withholdings. These responsibilities (liabilities) can be a tremendous burden to the care-recipient.
On the other hand, there is the “agency scenario,” which involves a caregiving agency. The agency typically assumes all responsibilities and liability for things like payroll, payroll taxes, and other. In the agency scenario, the caregiver is an employee of the agency.
It would be fair to say that deciding on which of the two relationships to go with would involve a cost/benefit trade-off between going with the independent caregiver scenario or the caregiver agency scenario. Not all of the cost taken into account would necessarily be financial or monetary. Some of the cost would be subjective or intangible in nature. The decision as to which scenario to go with is personal in the sense that it depends on the individual facts and circumstances. What makes sense for one recipient might not make sense for another.
Frequently, families may utilize a privately hired individual (independent contractor) for these following reasons, as noted in this helpful breakdown from NAHU.org:
• They can hire a person they choose based on their best judgment.
• They have more control and choice in the care plan, which may provide more flexibility for the family.
• The cost is typically lower than that of an agency.
• There may be more flexibility in terms of the caregiving schedule.
If you decide to hire an independent caregiver you should be prepared to:
• Locate potential caregivers
• Screen applications
• Conduct interviews
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Run background checks
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Administer payroll, including social security and other taxes
On the other hand, there are a number of offsetting benefits that come from hiring a caregiver through a caregiver agency instead of hiring an independent contractor. Here are a few of the major benefits of using a home care agency are the following, as quoted from VisitingAngels.com:
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Agencies will screen caregivers and conduct background checks. The ideal agency should allow you to interview several candidates in order to find the best caregiver considering your situation and circumstances.
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Always request professional and personal references for anyone you select.
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Agencies are typically bonded, licensed, and insured. Agencies should assume full liability for all care provided, and should be insured in the event a caregiver is injured in your home.
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Worth emphasizing is the fact that should you choose to hire an independent caregiver, as the employer, you will be responsible for the liability risk of both the caregiver and the care recipient.
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Before considering hiring an independent caregiver, carefully consider all of the liability, responsibility, and attention that will be required of you.
Visiting Angels makes a critical point: before you go down the path of hiring an independent caregiver, make sure you fully understand the “liability, responsibility and attentiveness” that will be required of you.
Likewise, before you hire an agency, make sure you understand how much control you’re relinquishing to the agency and whether or not that will have a negative impact on your loved one. In other words, ask lots of questions so that you know what you’re getting into before you commit to either option. It could make all the difference for both your loved one and you and your family as you work together to find a solution that makes the most sense for your situation.