Until someone figures out how a robot can change an adult diaper, watch out for bedsores or help a frail senior to the bathroom, those tasks will continue to perform by human beings. And when a family requires a paid human being to provide such care to an elderly loved one, they will take one of three options: engage a home care company that employs its home care workers, hire directly or use an intermediary company to find pre-screened caregivers.

Intermediary companies, called registries or placement services, have been around a long time. And, in this age of internet commerce and “apps” for every conceivable purpose, it is not surprising that some entrepreneurs have even launched online versions that connect consumers with caregivers via internet platforms.

Such placement agencies, whether of the bricks-and-mortar or online variety, purport to offer several advantages to consumers. Are they legitimate? Let’s see:

Convenience?

Placement agencies pre-screen caregiver candidates by performing background checks, checking professional credentials, verifying work eligibility and the like. The consumer is spared the time and effort to perform these functions—an undeniable plus.

But what then? It is still up to the consumer to interview and select the candidate, negotiate agreeable schedules, monitor performance, provide counseling and feedback—in short, do what an employer would have to do. And, speaking of employer duties, someone in this equation needs to be responsible for payroll taxes, liability insurance, indemnification against dishonest acts etc.

And how convenient is it for the consumer when the caregiver calls out due to an emergency, or wants a different schedule, or fails to appear or decides to quit?

Cost?

Using a placement agency sure better cost less, because they deliver a lot less! Here’s what you don’t get with a placement agency:

1. Protection from absenteeism by providing a temporary relief aide.
2. Supervision by a licensed health care professional.
3. A customized care plan.
4. Round-the-clock access to a supervisor.
5. Prompt and seamless assignment of a new caregiver aide when the care recipient’s needs or schedule changes.
6. Worker’s compensation insurance that insulates you from incurring obligations related to occupational injury.
7. The confidence that an outside accrediting agency, such as a state licensing body, is holding the company to minimum standards.

Fully-licensed home care agencies that employ and supervise their workers generally charge between $22 and $26 per hour in Northern Virginia, with a few above or below that range. If a placement service doesn’t charge a lot less, why even consider it?

Better Pay for Home Care Workers?

One of the most cynical claims promoted by placement agencies is that home care workers are better off because they are paid more. This can sway consumers who are concerned about the welfare of these hard-working people. However, the hourly wage figure tells only part of the story.

For one thing, the full burden of employment taxes and insurance costs often fall to the home care worker in arrangements made through placement agencies. Then too, a “living wage” is hardly of value if there isn’t enough work, which often happens when the worker is not legitimately employed by a company that can offer supplemental assignments. And if the aide is injured on the job (back injuries are rampant in home care, for example), who will pick up the costs of medical treatment and lost work?

Beyond that, most home care workers who find work through placement agencies are designated as independent contractors. Besides the questionable legality of such designations, that means they may lack certain legal protections that are afforded to W-2 employees like unemployment benefits or assistance in collecting unpaid wages.

The Bottom Line

It’s for reasons like the foregoing that the Home Care Association of America warns consumers to stay away from such entities. Their position paper on the subject can be accessed here.

All in all, the purported advantages of placement services don’t look very compelling when examined closely. About the best thing that can be said is that consumers usually save some money, but only at the expense of giving up a lot and assuming certain unwelcome risks, sometimes unknowingly.  Buyer beware!