Finding a caregiver for an elderly family member starts with two decisions: what level of care your loved one actually needs, and whether you want to hire through an agency or on your own. Each path comes with different costs, legal responsibilities, and trade-offs. Here’s how to work through the process from start to finish.
Determine the Level of Care Needed
Not all caregivers do the same work, and hiring the wrong type wastes money or leaves gaps in care. The two main categories are personal care aides and home health aides.
Personal care aides handle nonmedical tasks: companionship, cooking, cleaning, driving to appointments, and helping with daily routines like bathing and dressing. They’re sometimes called caregivers or personal attendants. If your parent is mostly independent but needs help staying safe at home and keeping up with household tasks, this is the right fit.
Home health aides can do everything a personal care aide does, plus basic medical tasks under the direction of a nurse. That includes checking vital signs, helping with prescribed exercises, giving medications, changing bandages, and in some cases operating medical equipment like ventilators. If your loved one is recovering from surgery, managing a chronic condition, or needs hands-on health monitoring between doctor visits, a home health aide is the better choice. These aides work under the supervision of nurses or therapists and, in many states, must pass a competency exam and hold a certification.
Agency, Registry, or Private Hire
There are three main ways to bring a caregiver into your home, and the differences between them are significant.
Full-Service Home Care Agency
A professional agency recruits, screens, hires, trains, and supervises its caregivers. The caregiver is the agency’s employee, not yours. That means the agency handles payroll taxes, carries liability insurance and workers’ compensation, and performs criminal background checks before anyone sets foot in your home. If your regular caregiver calls in sick, the agency sends a backup, sometimes on the same day. If there’s a performance issue, you report it to the agency and they handle it. This is the most hands-off option, and it’s also the most expensive, because the agency’s overhead is built into the hourly rate.
Registry or Staffing Service
A registry connects you with independent caregivers but does not employ them. When you hire through a registry, you may become the caregiver’s legal employer. That means you take on payroll taxes, liability if the caregiver is injured in your home, and the responsibility of managing performance. Few registries perform background checks on the caregivers they place, and they are not allowed by law to supervise them. Home insurance policies usually exclude coverage for employees working in your home, so a caregiver injury could leave you personally liable for medical bills and disability costs.
Direct Private Hire
Hiring someone independently, through word of mouth, online job boards, or community referrals, gives you the most control over who you bring in and what you pay. But it also means you’re fully responsible for vetting, tax compliance, backup coverage, and every aspect of the employment relationship. This route works best for families willing to invest the time in screening and paperwork.
Where to Search
Your starting point depends on which hiring model you choose. For agencies, search for licensed home care providers in your state. Many states maintain directories of licensed agencies through their department of health.
The Eldercare Locator, a free service run by the Administration for Community Living, connects families with their local Area Agency on Aging. These agencies can point you to vetted home care providers, explain what programs your loved one qualifies for, and help you navigate the options in your specific community. You can reach them at eldercare.acl.gov or by calling 1-800-677-1116.
For private hires, online caregiving platforms like Care.com and CareLinx let you browse profiles, filter by experience and certifications, and read reviews. Community networks matter too. Ask your loved one’s doctor, hospital social worker, or local senior center for referrals. People who work with the elderly population daily often know which caregivers have strong reputations.
How to Vet Candidates Thoroughly
Whether you’re hiring privately or evaluating an agency, thorough screening protects your family member from neglect, theft, and abuse.
Start with references. Ask every candidate for at least three, and make sure at least two are from former employers. Call all of them. Ask specific questions: Was the caregiver reliable? How did they handle emergencies? Would you hire them again? Don’t skip informal sources either. If a friend recommended the caregiver, talk to that friend in detail.
Verify identity with a government-issued photo ID such as a driver’s license, passport, or military ID. Record the number. If the caregiver will be driving your loved one, contact the DMV to confirm a clean driving record and verify their license and insurance are current.
If the candidate claims any professional license or certification, verify it directly with the licensing body, such as the state Board of Nursing. Don’t take their word for it.
For criminal background checks, consider hiring a screening agency. In many states, criminal history records from the Department of Justice are only released to qualifying organizations, not to individual families. A screening agency can run fingerprint-based checks that go deeper than a basic name search. Ask the candidate to sign a waiver allowing you to view their personal history and run a background check. Anyone who refuses that request is telling you something.
What Medicare Will and Won’t Cover
Medicare covers home health services, but only under specific conditions. Your loved one must need part-time or intermittent skilled care (like nursing or physical therapy), and they must be “homebound,” meaning leaving the house is either not recommended due to their condition or requires significant effort and assistance.
When those criteria are met, Medicare typically covers up to 8 hours per day of combined skilled nursing and home health aide services, with a maximum of 28 hours per week. In some cases, a provider can authorize up to 35 hours per week for a short period. Medicare does not pay for 24-hour care, and it does not cover personal care aides who only provide nonmedical help like cooking and companionship. For that type of ongoing daily assistance, you’re paying out of pocket or through long-term care insurance if your loved one has a policy.
What Care Actually Costs
The national median wage for home health and personal care aides is $16.12 per hour, according to May 2023 data from the Bureau of Labor Statistics. That’s the wage the caregiver earns, not necessarily what you pay. If you hire through an agency, expect to pay significantly more per hour, often $25 to $35 or higher, because the agency’s rate includes their overhead, insurance, training, and profit margin.
Rates vary widely by region. Urban areas and states with higher costs of living charge more. The level of care matters too: a caregiver who handles medication management and wound care commands a higher rate than one providing companionship and light housekeeping. If your loved one needs overnight or weekend shifts, many agencies charge a premium.
Tax Obligations for Private Hires
If you hire a caregiver directly and pay them $3,000 or more in cash wages during 2026 (this threshold adjusts annually), the IRS considers you a household employer. You’re required to withhold 6.2% for Social Security and 1.45% for Medicare from the caregiver’s pay, totaling 7.65%. You also owe a matching 7.65% from your own funds.
You’ll need an Employer Identification Number, which you can apply for free on the IRS website. At tax time, you’ll file a W-2 for the caregiver and attach Schedule H to your personal tax return to report household employment taxes. If you also agree to withhold federal income tax, you’ll need a completed W-4 from the caregiver. Some families make quarterly estimated tax payments using Form 1040-ES to avoid a large bill in April. Ignoring these obligations can result in penalties, and it leaves the caregiver without Social Security credits they’ve earned.
Put It in Writing
A written employment agreement protects both you and the caregiver. The U.S. Department of Labor publishes a sample agreement for home care workers that covers the essentials. At minimum, your agreement should include:
- A detailed job description. Spell out exactly what the caregiver will and won’t do: bathing, dressing, medication, meal prep, light cleaning, transportation, pet care, companionship. Ambiguity leads to conflict.
- Schedule and pay. Define the days, hours, hourly rate, overtime policy, and how and when payment happens.
- Termination terms. Agree on a notice period (typically one to two weeks) for either side. Specify whether severance applies and list the situations that justify immediate termination without notice, such as abuse, theft, or showing up impaired.
- Transportation expectations. If the caregiver will drive your loved one, state where, how often, and who covers mileage or gas costs.
- Confidentiality. Include a clause requiring the caregiver to keep your family member’s personal and health information private.
Both parties should sign the agreement and keep a copy. Revisit it whenever care needs change, which they will. A caregiver hired for companionship and meal prep may eventually need to help with bathing and transfers as your loved one’s condition evolves, and the agreement (and compensation) should reflect that shift.