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Home and Senior Care Franchise Industry Report 2016

Home and Senior Care  Franchise Industry Report-1

“If you look closely at the demographics, the years ahead hold great promise for [the home and senior care] industry.”

~ Scott Kummel, Director of Franchise Sales for Touching Hearts at Home


A Feel Good Career

Being a home and senior care franchisee offers the opportunity to build a rewarding business that has benefits franchisees professionally and, maybe more importantly, personally. “We make sure they stay in their homes, and lead an independent life without having to go to a nursing home or an assisted living [facility],” says Lisa Reisman, a CareMinders franchisee. “The amazing feeling at the end of the day is worth all of the hard work. When you know you've made a difference in someone's life…that is amazing.”


And the good feelings of helping someone aren’t limited to the franchisees. As Gary Kneller, president of CareMinders told us, “We're motivated to work with potential franchisees, and have them become part of our system. It is rewarding when you see a franchisee that wants to be their own boss, wants to have control of their life become a success story.”


Industry Overview and Outlook

Currently, 6.5 million seniors need assistance with their daily activities, and this number is expected to at least double by the year 2020.

For those that need or want it, home and senior care franchises provide non-medical and skilled medical services that can include any combination of the following:


  • Companionship
  • Meal preparation and feeding
  • Escorting to doctor’s visits, etc.
  • Housekeeping and laundry
  • Caring for pets and plants
  • Grooming assistance
  • Help with errands
  • Respite care/Caregiver relief
  • Therapy services
  • Chronic disease management
  • Medication reminders
  • Medication administering
  • Infusion therapy
  • Incontinence care
  • Nursing intervention
  • Live-in care
  • End-of-life care

Home and Senior Care  Franchise Industry Report-1


Services are provided predominately to seniors, but it should be emphasized home and senior care franchises cater to any individual who needs their services regardless of age. Other populations that utilize home and senior franchises include:


  • People recovering from accidents
  • People returning home after surgery
  • People who require complex treatments and/or monitoring
  • People dealing with chronic diseases and disabilities (mental or physical)
  • Mothers and newborns in the first days after discharge from the hospital


The area is so popular, it’s been highlighted by outlets such as Forbes as a top franchise opportunity.


According to First Research, the U.S. home health care industry includes about 30,000 establishments (single-location companies and branches of multi-location companies) with combined annual revenue of about $70 billion. It is a subset of the larger elder care services market that includes nursing homes, product manufacturers and related businesses, which is expected to grow to around $400 billion by 2018.


Additionally, the Bureau of Labor Statistics predicts job growth of 70% for home health and personal care aides over the coming decade. And senior living organization Argentum states, “The senior living industry will need to recruit 1.2 million new employees by 2025 and must be poised to create working environments and career paths attractive for these workers.”


The Greying of America and Changing Desires

While franchises and other service providers in this field cater to all ages that need assistance, the primary market is senior citizens – a rapidly increasing segment of the population. Americans 65 and over accounted for 14.1% of the population, or nearly 45 million people, in 2013 (the most recent year for data availability from the U.S. Department of Health and Human Services). The percentage is steadily increasing and expected to grow to 21.7% by 2040.


And since the number of senior citizens is increasing, it also means the amount of money seniors have to spend on what they desire will be increasing as well.


Elderly Home Revenue Statista Graphic


“I feel very comfortable, and the most important thing is that – at my age of 85 – I am allowed to live in my own home with my husband.” 

~ Frances Zaglan, a home care franchise client in 2012


According to an AARP survey, approximately 89% of seniors want to age in their own homes for as long as possible, and 80% believe their current residence is where they’ll always live.


The desire to “age-in-place” has been a key contributing factor to the growth of the industry. A comparatively small number of seniors (1.5 million or 3.4%) live in institutions such as nursing homes, and of the almost 27 million households headed by seniors, 81% own their residence.


As these seniors age, occasional outside help can aid in maintaining independence in many cases. This is especially the case as the number of familial caregivers is on the decline. According to AARP, there are now seven potential family caregivers for every person over 80, which is expected to fall to four by 2030.


The Effect of Federal Funding Cuts

Cuts to Medicare and Medicaid programs are also a contributor to the shift towards more in-home care as opposed to traditional nursing home living in senior years. As an editorial in Senior Housing News stated:


“The demise of the traditional model of skilled nursing and nursing homes will begin to accelerate in senior living business as consumers begin to learn that a nursing home no longer has to be the final resting place for seniors. This alone is a stark change from the concept of “warehousing the elderly” that has been a stereotype of over 30 years. The costs to keep someone in a skilled nursing facility are the highest of any part of the continuum of care.

“The business model of skilled nursing is nearing functional obsolescence in a practical, physical, and economic sense. Additional cuts to Medicare and Medicaid expected in the future and a growing stock of vintage buildings that can’t support today’s care methods will further burden a dysfunctional model. Further exacerbating the challenges of operating skilled nursing in its traditional sense are the risk management measures, costs of insured and increased litigation risk.”


In its prediction for job growth in the home health and personal care aides, referenced above, the Bureau of Labor Statistics also noted the aspect of lesser cost for those who don’t need comprehensive assistance.


Investing in a Home and Senior Care Franchise

Please note: the provisions and fees illustrated below are some of the most common and not a complete listing. All financial figures come from the Franchise Disclosure Document (FDD) of each respective franchise dated 2015 (except Nurse Next Door, which is dated 2016). Please review the FDD of a franchise for all of the provisions and fees related to investing in that particular franchise.


“Really, it boils down to systems. The team at Nurse Next Door has built incredible systems that have helped make our franchise so successful. We're definitely excited for the growth to come.” 

~ Chris, Nurse Next Door franchise partner

“We just celebrated our two-year anniversary of the purchase of our agency and, as of today, we entered our third week of billing over 1,700 hours per week! Oh my gosh! It’s been crazy, exciting, scary and fun all at the same time.” 

~ Page, Visiting Angels franchisee



Below is an overview of a few topics to consider when buying a home and senior care franchise, including a summary of typical costs.


Medical vs Non-Medical

When choosing a franchise an important decision to make is whether you want to pursue medical, or skilled care vs. non-medical.


“It’s tempting for the franchisors to want to delve more into skilled care,” according to Kummel. “However, non-medical provides a much lower cost of entry as well as liability and headaches yet it does not limit revenue for the franchisee.”


Insurance and Licensing

One of the advantages to aligning yourself with a franchise in the home and senior care industry is, in many cases, the franchise brand you choose already has a measure of familiarity with the rules and regulations that must be adhered to. Within the FDD for franchises, there will be an estimate for how much it will be to obtain your initial insurance and licensing.



Initial Insurance

Licenses, Permits & Professional Fees

Home Helpers

$2,000 - $4,000

$0 - $15,000

Home Instead

Combined under "Miscellaneous Opening Costs including insurance deposit" in FDD: $5,000 - $7,000


$3,000 - $6,000
(plus liability and bonding)

$500 - $10,000

Nurse Next Door

$2,500 - $6,000

$500 - $10,000

Visiting Angels

Combined in FDD: $2,500 - $9,500
(including workers comp)

Initial Insurance and Licensing Fee Estimates for Selected Home and Senior Care Franchises


Each state has its own requirements for home and senior care businesses. In most cases, satisfying the requirements is fairly straightforward. However, in some states insurance and licensure fulfillment can be more challenging. Make sure you are fully aware of your area’s requirements – city and state.  As the business owner, all responsibility ultimately falls on you.


Who Does Well as a Home and Senior Care Franchisee?

People skills is a key attribute. Being able to quickly connect with people and engender rapport is important. In addition, this is an industry for which networking and creating a foundation of personal referral sources can make or break a business. Luckily for franchisees, they’ll have assistance in the form of a franchisor that has “been there and done that.”


How Long Does It Take to Start?

It depends on the franchise. For example, a Touching Hearts at Home franchise can be opened anywhere from 30-120 days from the time the franchisee signs an agreement, depending upon the individual states licensing requirements.


Investment Numbers

When it comes to investing in a franchise finding the right concept is dependent on not only the type of the franchise, but also the money needed. Below we’ve compiled the initial investment and royalty payments listed in the Franchise Disclosure Documents (FDD) for the start-up of five home and senior care franchises. While these figures only give a small glimpse into what the costs are for owning a franchise, they are a good starting point for thinking about your budget.


The amount necessary to open a franchise varies depending on the unique business system and execution requirements. The following charts demonstrate, by comparison, estimated initial investment ranges associated with opening one of the sample franchises presented.


Estimated Initial Investment Ranges for Seniore care-1

Estimated Initial Investment Ranges for Sample Franchises


Initial costs associated with opening a franchise include the franchise fee, training expenses (such as travel and living expenses, not the actual training courses), marketing costs, and more. You’ll notice that, in general, home and senior care franchises tend to cost less than franchises in some industries because of being a primarily mobile-based field. The real estate requirements are usually not as high.


Don’t forget about the ongoing fees when setting your franchise budget. Throughout the length of the agreement there are costs for being a part of the franchisor’s business system. The most common ongoing fee is the royalty fee, which is assessed for the continued use of the franchisor’s trademarks and patented processes.




Home Helpers 

6% down to 3% of Gross Revenues; $300 monthly minimum for 1st 2 years; $1,800 monthly minimum after 1st 2 years

Home Instead 

5% of Gross Sales


5% of monthly Gross Billings

Nurse Next Door 

5% of Gross Sales, subject to annual minimum royalties

Visiting Angels 

3.5% of total Gross revenues up to $60,000 per month in revenues; 3.0% after $60,000 per month; 2.75% after $95,000 per month; 2.5% after $150,000 per month; 2.25% after $200,000 per month; 2.0% after $250,000; Minimum payments apply

Royalty Fees for Sample Franchises

(Note: For more detailed investment information on initial and ongoing costs, please click the franchise name.)


Other regular ongoing fees include advertising (they also can be referred to as marketing or brand development costs), as well as software and technology costs.


In addition to regularly assessed fees, there are other fees are charged on an “as needed” basis such as audit fees, or costs for additional, non-mandatory, training. Prior to investing, prospective franchisees should do their research and carefully review a franchisor’s FDD for more detailed information on all systems, procedures and costs.


For more information on a number of franchises related to staffing and employment services, please see our listing of home and senior care franchise opportunities.

Home Care Franchises...

Visiting Angels Living Assistance Services Join "America's Choice In Homecare®", ranked #1 of all senior care franchises! Read More Min. Cash Required:

Golden Heart Senior Care Golden Heart Senior Care is an award-winning franchise in the booming senior care industry! Read More Min. Cash Required:

Home Care Assistance Be your own boss and improve the lives of others with the industry's most respected name in care giving. Help... Read More Min. Cash Required:

Age in Place Home Care If you love helping people and want to be an entrepreneur, this franchise is for you! Read More Min. Cash Required:

ComForCare Home Care Join one of the fastest growing home care franchises in the United States! Read More Min. Cash Required:

StartupHomeCare Own your own non-medical senior care agency with StartUpHomeCare with only a one-time fee. No royalties and no... Read More Min. Cash Required:

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