Tuesday, December 10, 2013

What You Don't Know - The Profit of The AGEncies....

Today’s Private Duty In-Home Senior Care Industry is truly Big Bucks for the AGEncy Owner, but makes little to no cents for the one providing the actual care. YOU have the means to make a difference in this. What you know now will help you later.
Need someone to watch over your aging loved one while you are otherwise busy? Senior Home Care is big business making millions for the owners of the agencies in your area.  Some people see this as a new MLM hidden under the blanket of a family of ‘franchises’. 
So, before you run to the phone to employ a dedicated hardworking caregiver who will only make miniscule funds (approximately 36% or $9 of the $25 you are charged by the Agency) to care for your family, you owe it to yourself to read this. Making a living is alright in the world of business. Yet many owners push & shove their way to the top of their company status quo by being experts in taking advantage of employee’s skills to make a buck & discarding them once the gig is up. Often the same is true that the company & the owner begin seeing the client as a number (often a dollar sign attached). How do they sleep at night with this sham lurking beneath their bank covers?

Yes, you are paying for the owner’s one of many multimillion dollar estates, a tricked out RV, new Beemer, & another exotic vacation cruise for their entire family.  The staff members that are hired to run the office find themselves at the revolving door of termination once the truth is uncovered & ethics are questioned. While owners have no tolerance for objections once greed has overtaken the reason for doing what they do, the truth always comes out eventually.
When you elect to hire someone directly (without an agency) to be there for your loved one you are able to pay a fair wage for their services.  An Agency will only pay the caregiver minimum. The difference is when you hire via an agency; you are making one person, the owner of the agency- very, very RICH.
If you have read this far and this is of interest to you, be aware that for every hour you are billed for a care giver, the owner of the agency you have contracted personally pockets approximately $11 of that $25. That is absurd.
To help clarify, here’s a little math:
Average example: An Agency has 300 clients at a required minimum of 24 hrs of service per week x $25/hr for approximately 52 weeks...
Less franchise fees of $5 per billable hour.
The care giver makes $9 before taxes (no benefits are provided). The owner is making a sweet: $80,000 take home a week? Yes you read that correctly!!! (only 300 clients...)
You will pay $31,200 a year for 24 hrs of care a week (although you probably will discover an alternative to this expense of $2600/mo)
Remember- the following is based from only 24 hrs care/wk.

$31,200 per year x 300 clients = $9,360,000 INCOME
$20,000 lease for office / mo x 12 = $240,000/yr
$50,000 salary for each of the 10 office staff = $500,000
*More accurate salaries range in the mid $30s.

$1,800,000 paid to the Franchise ($5 per hr billed)= $1,800,000
$11,232 / yr paid to each of the 300 Care Givers ($9/hr x 24 x52) = $3,369,600
(An additional $100,000 for miscellaneous expenses)
Drum Roll (be sure you are sitting down less you fall over).

With only 300 clients a week...imagine the numbers increasing-
Agency Income: $9,360,000 annually
Total overhead: $6,010,000 annually
Total owner profit: $3,350,000 annually
Care Giver hourly: $11,232 - $15,000 (24-31 hrs/wk) no benefits.

I remember when I was a privately hired care giver, as a 1099, I was making the fee which would have been paid the agency. In addition to this opportunity, I have also worked as a business & marketing manager on the inside of this industry for agencies. I know first hand the game of scrambling to grab another customer to provide 'a service'  (Check the oil please) I have assisted the owner(s) to become millionaires & have watched egos & arrogance swell with each dollar bill added to the bankroll. With little to no respect for the well being of those in their employ *short lived at that....the areas of big business BS that is shadowed by the sweet, caring --facade.

When you hire someone to provide the actual CARE for your family member compensate them fairly. The agency is not doing anything that you yourself could do. Knowledge is powerful & rewarding. Your loved one need not pay more than needed. Negotiate. Think about it- it’s personal to the caregiver...its profit for the owner- plain & simple.  

BEFORE the need arises, do your research. Find a genuine caregiver who meets your qualifications. They need to support their family; themselves....You can then be part of their solution as they become part of yours.

<Although the billable fees & amounts may vary per agency-the above is an example, the truth of the matter is still accurate. You can control the quality & the cost of care>



Do you enjoy helping people or caring for elderly family members? You may want to steer your natural compassion toward a career as a home health or personal care aide, a field that is heating up across the country.

According to the U.S. Department of Labor, home health and personal care aides help older adults or people who are chronically ill, disabled, or cognitively impaired execute day-to-day activities like bathing or light housekeeping.

Hot Factors: The Department of Labor says employment of home health and personal care aides is projected to grow by a staggering 70 percent from 2010 to 2020, resulting in a total increase of 1.3 million professionals.

Why such impressive growth? There is a huge cohort of baby boomers reaching the age of care, says Shatkin. Plus, he says, the preceding generation is already well into that age.

Shatkin also identifies a shift in how elderly care is performed today. "The practice has been to move toward caring for people at home as much as possible, partly to contain health care costs and partly because the outcomes are better when people are in their familiar environment," he says.

Education Requirements: If you're interested in pursuing a career as a home health or personal care aide, here's some great news: According to the Department, there are no formal education requirements for this profession. However, most aides have a high school diploma and those working in home health or hospice agencies must have "formal training and pass a standardized test."