How Home Care Agencies Make Money

Running a home care agency can be a very satisfying and rewarding business. But how exactly do they make their money? If this is a business you’ve considered getting into, then this is likely a question you have asked yourself in the past. Let’s break it up and get down to how exactly home care agencies make money.

Home care agencies make money in a variety of ways. They offer services such as everyday companionship, long-term nursing care, or short-term injury assistance. They then bill the clients’ health insurance, or bill them directly in order to get paid. 

In order to gain a better understanding of what it is exactly that home care agencies do, and the services they provide, let’s take a look at each category individually. Hopefully by the end of this article, you’ll have a much better understanding of how home care agencies make money and operate!

Every Day Companionship

How Home Care Agencies Make Money

Everyday companionship isn’t limited to those who are injured or aren’t feeling well. In fact, very often, this type of care is given to those who don’t have any type of injuries at all. Often those who are elderly will seek out everyday companionship in order to have assistance with daily tasks such as laundry, cooking meals, housekeeping, help with pills etc. They can also help out with tagging along on doctors’ appointments, and if the individual is in a wheelchair, they can help with getting in and out of it and going from room to room.

Often individuals who seek out this time of care are elderly or need additional assistance with moving about or taking their medication. They pay their care givers – or the home care agency they are working with – directly out of pocket or if they have insurance the insurance will cover the costs.

This type of care could be as little as once a week, or a few times a week for certain time periods. Every day companionship could also be live in care, with someone providing care to the patient around the clock.  

Long-Term Nursing Care

Another type of care that a home care agency can offer is long-term nursing care. This type of care is given to individuals that require some type of medical care or assistance. These types of assistance can include help with feeding tubes, administering IV’s, assistance with ventilator use, watching over the patient’s vital signs, helping with medication etc. This is by no means an all-inclusive list, but just gives an overview of what a long-term nurse can be responsible for. 

Just like with every day companionship services, long-term nurses are paid either directly by the patient – out of pocket. Or they will be paid by the insurance company that the patient has. Regardless of how they are paid, this is another large part of how home care agencies make money.

Nurses typically will visit the client in eight to ten hour shifts, as needed. At times, if it is required, two to three nurses may take turns covering in order to provide the client with full time coverage. 

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Short-Term Injury Assistance

Short-term injury assistance is when an individual who has either been in an accident or has fallen ill needs assistance in order to get back on their feet. Examples of this can be recovering from a car crash, or other physical injuries. Those who provide short-term assistance could provide services such as physical therapy, speech therapy, or mental health services. They also may have to assist with getting around the house if the individual is unable to walk on their own. 

Just like with every day companionship, and long-term nursing care, those who provide short-term injury services are often paid either directly by the client or by the client’s healthcare provider.

This type of care usually isn’t full time, and may be in short one to two hour increments depending on how much assistance the client needs. It will also vary on the type of care given.

How Much Do Home Care Agencies Charge?

After doing my research, it looks like home care agencies charge between $16 and $28 dollars per hour, depending on the state and the service offered. This means on average, the hourly cost of in home care is $22.00 per hour. Once again, if this was an industry you were considering getting into, then this is an important factor you’ll want to take into account. Digging into this a little bit deeper, those who held more specialized positions such as nurses seemed to bring in the highest wages in this field. 

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Bringing it All Together

How Home Care Agencies Make Money

Basically, the way that home care agencies get paid is by providing services to individuals that need them. Whether that be assistance with daily tasks, sending a nurse to the client’s home to provide long-term care, or providing care after an accident or illness occurs. Home care agencies are then paid either directly by the clients, or they are paid by the client’s insurance provider. 

If you think this may be a field that you’d like to enter, these are all great things to know beforehand. It will also help to understand just how to enter the industry and how you can get started with your own home care agency, should you decide to do so. Check out this article from to see the basic steps in how to get started! They offer practical tips and advice for anyone who is interested in learning more about setting up their own home care agency.

On the flipside, if you already a licensed nurse, then perhaps you are interested in working for a home care agency vs a hospital or clinic. Depending on what you are hoping to find, you may find that working for a home care agency is a better fit for you then working at a hospital. In this case, I would advise checking out the benefits that a home care agency has to offer, and how it pays compared to working as a nurse at a hospital. 

According to there are roughly 450,000 home care agencies in just the U.S. alone. If this is an industry you are seriously considering entering, then make sure you do your homework on the market before you get into it. With that many home care agencies already around, the last thing you want to do is get started in an area that is already oversaturated with what you are trying to offer. 

Instead, try to find an area that is lacking in this type of service, and see if you can get started instead. If you’ve found an area that is relatively untouched as far as competition within the home care industry goes, then you’ve hit the jackpot! Home health care is needed in every area, and finding a market that is untouched means not only that you know you will have a strong client base and make good profit. You also know that you will be able to help many people with your home care agency. Ultimately, if you’ve decided to enter this field, then helping others is likely your end goal. 

Hopefully all of these small tips, tricks, and suggestions will help, and you will be able to take what you’ve learned here into getting started with your own home care agency. Or maybe you’ve learned that rather than starting one of your own, you’d rather become a home care assistant or nurse practitioner and work for one instead. Or maybe, you end up deciding that this isn’t the field for you at all! Regardless of what you end up doing, hopefully this article has helped guide you! Best of luck!

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Frequently Asked Questions

  1. Do I need to be licensed in order to start a home care agency?
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Depending on the state you live in, the requirements will vary slightly, but in most states, you do need to be licensed and pass certain requirements before you will be allowed to open up your own home care agency. This is due to safety regulations that are in place surrounding medical care, and occupations in the medical field. 

  1. Do I need to be a nurse in order to work for a home care agency?

There are a few different positions that make up a home care agency. While most home care agencies will have registered nurses on their staff, there are also other positions available. For example, if you would like to become a home care provider, there are certain training and exams that you need to pass through the state before you can become one, but unlike nurses, you don’t need to have a bachelors or associates in nursing. 

To learn more on how to plan your own home care business click here!

Please note that the contents of this blog are for informational and entertainment purposes only and should not be construed as legal advice. Any action taken based on the information provided in this blog is solely at your own risk. Additionally, all images used in this blog are generated under the CC0 license of Creative Commons, which means they are free to use for any purpose without attribution.