If you're planning to start a home healthcare agency in Pennsylvania or you're already running one, understanding your insurance obligations isn't optional—it's absolutely essential. Pennsylvania takes these requirements seriously, with criminal penalties for non-compliance that can include jail time. But here's the good news: once you understand what's required, getting the right coverage is straightforward. Let's walk through exactly what you need to know.
Workers' Compensation: The Non-Negotiable Requirement
Here's what catches many new agency owners off guard: Pennsylvania requires workers' compensation insurance from day one. Unlike some states that have employee count thresholds, Pennsylvania law mandates coverage for your very first employee—whether they're full-time, part-time, or seasonal. If you have even one person on payroll who isn't you, you need workers' comp.
For home healthcare agencies specifically, Pennsylvania splits workers into two classification codes. Skilled workers like registered nurses and therapists fall under class code 0942, while non-skilled workers like home health aides and companions fall under code 0943. This matters because these codes affect your premium rates—skilled care workers typically command higher premiums due to different risk profiles.
As of January 2025, the maximum weekly benefit for injured workers is $1,347. This figure matters for your insurance planning because it affects how claims are paid out. If one of your employees gets injured on the job after January 1, 2025, their benefits fall under this new rate structure.
The penalties for skipping workers' comp are severe. Pennsylvania can charge non-compliance as either a misdemeanor or felony. As a misdemeanor, you're looking at a $2,500 fine and up to one year in jail for every single day without coverage. As a felony, that jumps to a $15,000 fine and up to seven years in prison—again, per day. These aren't theoretical penalties. The state enforces them.
General Liability and Professional Liability Insurance
When you apply for your home care agency license in Pennsylvania, you'll need to submit proof of insurance coverage. This includes both general liability and professional liability insurance. While Pennsylvania doesn't specify exact dollar minimums at the state level, you absolutely need these policies to get licensed.
General liability insurance—sometimes called "slip and fall" coverage—protects you when someone who isn't your employee gets hurt or their property gets damaged. Think about it: your home health aide is in a client's home. If they accidentally knock over an expensive vase or if a family member trips over medical equipment your agency brought in, general liability covers those claims. For a small Pennsylvania agency, you're typically looking at $500 to $1,500 annually for this coverage.
Professional liability insurance is different. This protects you against claims of negligence, mistakes, or misrepresentation in the actual care you provide. If a family alleges that your aide made an error in administering medication or that your nurse gave bad advice, professional liability insurance handles those claims. This is particularly important for agencies providing skilled nursing care.
Even though state law doesn't mandate specific dollar amounts, you'll often face practical requirements that do. Commercial landlords frequently require proof of general liability before leasing you office space. Healthcare facilities and private clients often require minimum coverage amounts—commonly $1 million per occurrence—in their contracts. If you work as a subcontractor for larger agencies, they'll almost certainly require you to carry your own policies with specific limits spelled out in your agreement.
The Licensing Process and Insurance Documentation
Pennsylvania home care agencies operate under regulations found in 28 Pa. Code Chapter 611. The Pennsylvania Department of Health oversees licensing, and as of 2024, applications are taking 2-3 months or longer to process. You'll submit your application via email to ra-dhhhandhosinitial@pa.gov, but you must also physically mail the required fees for processing.
Your insurance documentation is part of the required supporting documents. You can't skip this step. The state needs to see that you're properly insured before they'll approve your license. Make sure you have your insurance certificates in hand before starting the application process—trying to rush insurance coverage to meet a licensing deadline rarely goes well.
Beyond insurance, you'll need business registration documents, background checks for staff, proof that your employees meet competency requirements, and evidence of health screenings. The licensing board may also have additional insurance requirements beyond what's in state regulations, so always check current requirements when applying or renewing.
Special Considerations and Exemptions
Most home healthcare agencies need workers' comp for everyone on payroll, but Pennsylvania does have limited exemptions. These include people covered under other workers' comp acts like railroad workers and federal employees. Domestic servants are exempt, though coverage is optional. Agricultural workers who work fewer than 30 days or earn less than $1,200 annually from one employer are also exempt. Finally, employees who've requested and received exemption due to religious beliefs or executive status in certain corporations don't require coverage.
For most home healthcare agencies, these exemptions won't apply. Your home health aides, nurses, and administrative staff all need coverage. If you're operating as a sole proprietor with no employees, you're not required to carry workers' comp for yourself—but the moment you hire your first employee, that changes.
Getting Started: Your Action Plan
Start by connecting with insurance agents who specialize in home healthcare coverage. They understand the specific risks your agency faces and can help you get appropriate coverage limits. Don't just buy the cheapest policy you find—make sure it actually covers what you need.
Review any contracts you're signing with clients, facilities, or if you're working as a subcontractor. These contracts often specify minimum insurance requirements that exceed state minimums. If you sign a contract requiring $2 million in general liability coverage and you only have $1 million, you're in breach of contract—even if you meet state requirements.
Budget realistically for insurance costs. They're not optional expenses you can cut to save money. Factor in workers' comp, general liability, professional liability, and potentially additional coverage like commercial auto if your employees drive to client homes. For a small agency, total annual insurance costs might range from a few thousand to over ten thousand dollars depending on your employee count and services offered.
Getting your Pennsylvania home healthcare agency properly insured isn't just about checking boxes for licensing—it's about protecting your business, your employees, and the vulnerable clients you serve. The requirements might seem daunting at first, but they're manageable when you understand exactly what you need. Take the time to get this right from the start, and you'll avoid costly penalties and sleep better knowing you're covered when something goes wrong.
