Consumer-Directed Or Agency-Directed Home Care – Which Model is Best?

Seniors and their families throughout New Jersey and the Philadelphia area suburbs use home health care services to remain living independently in their homes. Home care services, such as live-in caregivers and hourly companions allow seniors to age in place for as long as possible. There are basically two different models of home care, the registry (or consumer directed) model and the employee based (or agency directed). Both types can offer a variety of services to consumers, including nurses, home health aides, physical and occupational therapists, and companions. Each model has its pros and cons.

For most people, their first introduction to home care is through a referral by their physician, a discharge planner, social worker or geriatric care manager at discharge from a hospital stay or after finishing rehabilitation at a sub-acute center or rehab facility. People generally are not aware of the difference between consumer directed care and agency directed care.

The consumer directed care model is fashioned after the nurse registries that have been around since the civil war. In this model, an agency completes background checks on the candidate, such as criminal background checks, reference checks, interviews, social security checks and any other checks the agency feels necessary. Once the candidate is approved the agency will then refer them to the client in need of service. In this situation, the consumer is in charge, thus the term consumer directed model. They have the power and control to tell the caregiver what, when and where they want their services performed. They also decide how much they are willing to pay for services. Since caregivers set their own rates and families dictate what they are willing to pay, one of the registries main jobs is to find a good match between the two. Because the registry takes a much smaller fee than an agency, it is usually possible to make both the consumer and caregiver happy financially, thus creating a mutually happy relationship

The other model of home care is the agency directed care model. The agency directed model evolved out of the government funded programs that pay agencies to be the provider of services. With the agency directed model, the agency recruits, hires, trains, supervises, disciplines and sets the rate it charges patients and the wages it pays the caregivers. The agency would also develop the plan of care for the patient and selects the caregiver(s) to provide the care.

There are advantages and disadvantages to both models of home care. You need to decide which type of business is right for you or your loved one. Some of the advantages of the registry model are:

  • The cost of service is usually lower than the agency model
  • The client decides who provides their care, what services will be provided, and when service is provided
  • The caregivers typically earn more, therefore attracting a higher caliber caregiver
  • The client can obtain service on a long term, emergency, short term, or respite basis
  • Once the client selects a caregiver, the agency doesn’t have the authority to reassign that caregiver. The client determines if/when service ends.
  • The registry can serve as the liaison between client and care provider

Some of the disadvantages of the registry model are:

  • The care provider is not supervised by an agency nurse
  • Most caregivers carry their own liability insurance but are not covered through the agency for worker’s compensation. The consumer should check with their homeowner’s policy as this often covers injuries in the home.
  • The caregiver is working as an independent contractor and is therefore responsible for filing their own taxes. Depending on the situation, the client/family may be the employer and need to take out payroll taxes which can be easily set up with a payroll service.

Some of the advantages of the agency model include:

  • The caregivers are is always the employee of the agency
  • The agency deducts all taxes
  • The caregivers are supervised by an agency nurse

Some of the disadvantages of the agency model include:

  • Costs tend to be higher
  • Caregivers, being paid by the agency, don’t earn as much as those with registries
  • The agency determines who is assigned and reassigned to each client. This means the agency can pull a caregiver from your job in order to place them in a different position, even if you are very happy with your caregiver. find a caregiver
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