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Comparing Cost of Personal Care Services and Caregiver Pay

Fact Sheet
March 1, 2012

This fact sheet presents data suggesting that, in the private pay market, agencies charge consumers approximately twice the hourly rate paid to caregivers. Artificially low wages are underwriting the 30-40% profit margins that for-profit franchises report receiving for delivering personal care services. Additionally, hourly wages received by home care workers providing personal care services account for about half — from 49-53%— of the rates paid or received.

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Key Takeaways

For private pay, hourly wages for aides make up approximately 50% of the rates charged.
For Medicaid-funded home care, hourly rates paid to agencies accounted for about half of hourly wages for aides.
The factsheet suggests that large profit margins for agencies are seen at the expense of worker wages.
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