How to price home care services

Step 1: know what an hour of care costs you

Direct care cost is the caregiver’s pay plus the employer costs that come with each hour: payroll taxes, workers’ compensation, benefits and training. In the 2020 Home Care Benchmarking Study from Activated Insights, direct care expenses were 62% of revenue for the median-sized company, and the median gross margin was 38%.¹ That study is from 2020 and is national, so use it as a reference point for your own numbers, not as a California benchmark.

Step 2: choose a target margin and solve for the rate

The formula is: bill rate = direct care cost per hour, divided by (1 minus target gross margin).

Step 3: check it against the prices families see

Families compare what they can find. In Los Angeles that is a mix of sources that measure different things:

• California’s minimum wage is $16.90 an hour in 2026,⁵ and $18.47 an hour from 1 July 2026 in unincorporated Los Angeles County.⁶ Cities within the county can set their own.

Step 4: price by level of care, shift and minimums

A single hourly number hides what families need to compare. Price companion care, personal care and dementia care on separate lines if your costs differ. Set the rate for an hourly visit, a 12-hour shift and live-in care separately. State your minimum hours per visit and per week, because the smallest bill is the minimum hours times the lowest hourly rate.

Step 5: publish it and keep it current

A rate you do not show cannot help you win the call. A rate card puts your rates, your minimums and the date you confirmed them on your listing, signed by you. You set every number and can change it at any time.