How to Start a Home Care Business in Colorado

How to Start a Home Care Business in Colorado

Team Carepolicy.us
 Starting a home care business in Colorado is a promising opportunity for those who want to make a difference while building a sustainable and profitable enterprise. As the population ages, more people in Colorado are seeking in-home assistance rather than moving into nursing homes or assisted living facilities. This shift in preference has significantly increased the demand for home care services across the state.

Colorado is particularly well-positioned for this industry due to its growing elderly population and supportive healthcare infrastructure. Many families now prefer in-home care options because they offer comfort, familiarity, and personalized attention—often at a lower cost than institutional care. This trend presents a valuable opportunity for entrepreneurs and caregivers to start home care agencies that provide essential non-medical or skilled services to individuals in need.

Starting a home care agency can be fulfilling, but it requires proper planning, licensing, and adherence to strict regulations set by the Colorado Department of Public Health and Environment (CDPHE). Whether you plan to offer personal care, companionship, homemaking, or skilled nursing services, operating legally and professionally is key to long-term success.

Why Start a Home Care Business in Colorado?

  • Aging population: Colorado’s population age 60+ was about 1.3 million in 2023 (roughly 22% of residents), and it is projected to continue growing through 2030 and beyond.
  • Growing market: Home-based care is preferred by many families for comfort and continuity and is often more cost-efficient than institutional care depending on payer and acuity.
  • Supportive policy environment: The state maintains licensing pathways for both non-medical (Class B) and skilled (Class A) agencies, with Medicaid programs expanding options such as Community First Choice (CFC).
  • Flexible service options: You can begin with non-medical services (personal care, homemaker, companionship) and later add skilled services if you meet requirements.

Importance of Licensing in Colorado

In Colorado, obtaining a license is a legal requirement for anyone who wants to operate a home care agency. Whether your agency plans to provide non-medical services like personal care and housekeeping or more advanced skilled nursing services, you must follow regulations set by CDPHE.

Licensing ensures that your business operates according to state standards, which are designed to protect both the clients and the providers. These standards cover caregiver qualifications, safety protocols, client rights, and service quality. Being licensed not only keeps your agency legally compliant but also helps build trust with clients and families. In addition, a license is typically necessary for payer enrollment and insurance coverage.

Operating without a license is illegal and risks fines, penalties, or closure. If you’re serious about running a successful agency in Colorado, completing CDPHE licensure should be your top priority.

Requirements to Start a Home Care Business in Colorado

  • Business formation: Register an LLC or Corporation with the Colorado Secretary of State.
  • EIN: Obtain an Employer Identification Number from the IRS.
  • NPI (conditional): If you intend to enroll with Medicaid or other payers that require an organizational NPI, obtain a Type-2 NPI via NPPES. Colorado Medicaid enrollment guidance indicates that some HCBS providers require an NPI; others may not, depending on specialty and billing plans.
  • Tax registrations: Register with the Colorado Department of Revenue as applicable.

Licensing and Certification

  • Apply for licensure with CDPHE: Submit a Home Care Agency license application for Class A (skilled) or Class B (non-medical/personal care). See CDPHE Home Care Agencies for application guidance.
  • Policies and procedures: Provide policies aligned with 6 CCR 1011-1, Chapter 26 (Home Care Agencies) and Chapter 2 (General Licensure).

Office and Staffing Requirements

  • Administrator/Manager: Must meet the manager qualifications outlined for your license type (Class A or B).
  • Caregivers: Must meet hiring, background check, orientation, and competency requirements consistent with your policies and applicable payer standards.
  • Physical office/records: Agencies must be prepared for surveys and maintain accessible records; “branch office” definitions in Chapter 26 also contemplate physical presence for shared administration and supervision.
  • Background checks: Fingerprint-based checks per statute for owners and managers; CBI background checks as required.

Step-by-Step Guide to Licensing Your Home Care Business in Colorado

Step 1: Form Your Business

Register your LLC or Corporation, secure your EIN, set up a business bank account, and draft an operating agreement or bylaws.

Step 2: Choose Your Service Type

  • Non-Medical (Class B): Personal care, homemaking, companionship.
  • Skilled (Class A): Nursing and therapeutic services delivered by licensed clinicians.

Step 3: NPI (if required by your payer strategy)

Apply for a Type-2 NPI at NPPES if you intend to enroll with Medicaid or other payers that require an organizational NPI.

Step 4: Draft Colorado-Compliant Policies and Procedures

Prepare policies covering personnel, client assessment and service planning, infection prevention, medication services (if applicable), emergency preparedness, incident reporting, quality improvement, and record management. Ensure alignment with 6 CCR 1011-1, Chapter 26.

Step 5: Submit Application to CDPHE

  • Application through the Health Facilities portal
  • Required fees and documentation
  • Policies and procedures
  • Ownership/management disclosures and fingerprinting
  • Insurance information and organizational chart

Step 6: Prepare for Survey or Inspection

  • Train staff on agency protocols and document competencies
  • Organize personnel and client files
  • Verify caregiver qualifications and supervision arrangements
  • Ensure your physical location and record access meet survey readiness

Step 7: Receive Your License

Once approved, you’ll receive your Colorado Home Care Agency license. Display it at your business location and plan for annual renewal.

6. Maintaining Your Colorado Home Care License

  • Annual renewal: Licenses must be renewed annually with CDPHE.
  • Training and competency: Maintain ongoing orientation, in-service education, and documented supervisory oversight consistent with your policies and any payer-specific rules.
  • Incident reporting: Report adverse events per Chapter 26 and agency policy.
  • Recordkeeping: Maintain complete and current client and personnel records.
  • Quality assurance: Conduct internal audits and performance improvement activities.

7. Summary

Starting a home care business in Colorado is a meaningful way to serve your community while building a sustainable enterprise. With the right structure, licensed staff, and fully compliant policies, you can establish a reputable agency that meets growing demand. Success hinges on planning: build a solid entity, align documentation with 6 CCR 1011-1 Chapter 26, implement reliable training and supervision, and stay current on Medicaid initiatives like CFC.

8. FAQ

Can I start a home care business in Colorado without medical experience?
Yes. Medical experience is not required to open a non-medical (Class B) home care agency. Your Administrator/Manager must meet the qualifications in Chapter 26, and you must ensure appropriate supervision and training for caregivers.
What is the cost of getting a home care license in Colorado?
Costs vary by license type, insurance, and document preparation. Expect application fees plus the cost of policies, background checks, and survey readiness. Check CDPHE’s current fee schedule and plan a conservative startup budget.
How long does the licensing process take?
Timelines depend on application completeness, survey scheduling, and responsiveness to CDPHE. Prepare thoroughly to avoid avoidable delays.
Can I run the agency from a home office?
Some agencies use a home-based administrative office; however, you must ensure secure records, survey access, and supervisory availability. Chapter 26’s branch office provisions and survey expectations contemplate physical presence sufficient for administration and oversight.
Is an NPI required for non-medical home care?
An NPI is not a universal CDPHE licensing requirement for Class B agencies. If you will enroll with Medicaid or other payers that require billing under an organizational NPI, you must obtain one.
What changes with Community First Choice (CFC)?
Effective July 1, 2025, providers of personal care services under CFC must hold a Class A or Class B Home Care Agency license. Plan licensure accordingly if you intend to serve CFC members.

9. Resources

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