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Run the Payroll Fee Auditor →Blog · Payroll Management · Home Health
Home Health Agencies: Setting Up Direct Deposit (2026)
Direct deposit for a home health agency is set up once per employee with a bank authorization, prenoted, then paid through ACH on the pay schedule the state allows, with visit-based aide pay and travel time reimbursement settling on the same file. BEG: $45 per employee per month inside the payroll software you already use, live in 3 to 5 days.
Setup for home health agencies
Each employee signs a direct deposit authorization with routing and account numbers, the account is prenoted with a zero-dollar test before the first live deposit, and split deposits are recorded per employee. Federal law does not let an employer make direct deposit mandatory to a bank of the employer's choosing, and most states require a paper or pay card alternative for employees who do not opt in.
Travel between clients during the workday is hours worked and the agency must pay for it; ordinary travel from home to the first client and home from the last is not. In the fact sheet example, the 30 minutes an aide spends driving from one client's home to the next is paid time.
Timing and the home health agency pay cycle
The ACH file goes two banking days before payday for the funds to land on the date, which means hours for registered nurses and LPNs close earlier than the payday itself, and visit-based aide pay for the period is settled on that file or on a documented later settlement date. Off-cycle runs, final checks and corrections use same-day ACH where the bank supports it.
The rules behind this page, with sources
General information, not legal advice. Every rule below was read on the agency page linked next to it.
- Travel between clients during the workday is hours worked and the agency must pay for it; ordinary travel from home to the first client and home from the last is not. In the fact sheet example, the 30 minutes an aide spends driving from one client's home to the next is paid time. [DOL Fact Sheet #79D]
Read the full guide to how to set up direct deposit, and the rest of the home health agency payroll library.
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Frequently Asked Questions
Can a home health agency require direct deposit?
Federal Regulation E bars an employer from requiring deposit to a particular bank; the employee chooses the account. Many states add that a no-fee alternative must be offered, so a written opt-in with an alternative is the safe policy.
When does the home health agency pay file have to be released?
Two banking days before payday for standard ACH. Same-day ACH is available for off-cycle runs and corrections at a higher per-item cost. Travel between clients during the workday is hours worked and the agency must pay for it; ordinary travel from home to the first client and home from the last is not.
What does managed payroll cost for a home health agency?
$45 per employee per month, all-inclusive, inside the payroll software you already use, with no monthly minimum. Visit-based aide pay, travel time reimbursement and Medicaid billing vs payroll are configured at setup, not billed as add-ons.
Related Resources
Anthony leads payroll solutions at Business Executive Group, a national managed payroll firm serving businesses across industries including Home Health Agencies. BEG manages payroll at $45 PEPM, all-inclusive, with deep expertise in compliance, multi-state filing, and industry-specific payroll requirements. Get instant pricing at beghr.com.
Authoritative source: IRS: Understanding Employment Taxes
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