Loss of Household Services

What is loss of household services?

Loss of household services is the economic damage that arises when an injury or a death removes a person's ability to perform the unpaid work a household depends on: the cooking, cleaning, shopping, upkeep, transportation and care of children and adults that would otherwise have to be bought from someone else. The loss is valued at what it would cost to replace the work, hour by hour and task by task, at the wages paid in the household's area to the people who do that work for a living. KWVRS prepares the analysis as a stand-alone report or as one component of a larger damages case, and the analysis begins with what this household actually did rather than with an average.

Two disciplines meet in the analysis. The identification of the tasks and the counting of the hours is vocational work, done from records and, where needed, an interview about the household's routine before and after the injury. The pricing of those hours and their projection over time is economic work, and where the case needs a present value the analysis is coordinated with the forensic economics practice so that one figure reaches the court with one set of assumptions behind it.

What household services include

• Childcare: supervision, feeding, bathing and dressing, transport to school and appointments, help with schoolwork, and the overnight availability a young child requires, counted separately from the hours a parent spends with a child for their own sake.
• Home maintenance: interior cleaning, laundry, the repairs a homeowner does without a contractor, seasonal work such as snow removal and gutter clearing, and the upkeep of appliances and household systems.
• Meal preparation: planning, shopping for and cooking meals and the cleanup afterward, which time-use surveys record as one of the largest categories of household time for adults of every age.
• Other household production: yard and garden work, vehicle upkeep, household management such as bills, scheduling and correspondence, shopping for goods other than food, pet care, care of an adult family member, and the driving each of these requires.

Household services are the work a household would have to buy if nobody in it did the work. Four groups cover most of it, and the report lists the tasks in each that this person performed.

How the loss is measured

Which of those tasks a household lost is a question of fact. A person who did the cooking and none of the yard work has a different loss from a person who did both, and a household in which a teenager took over the laundry has a different loss from one that hired a service. The measure has four parts, each stated in the report with its source.

The first is the task inventory: what the person did, how often and for how long, built from the household's own account and checked against records such as work schedules, school and medical calendars and receipts for services the household has since hired, with the time-use data that describe what people of the same age, sex and household composition typically do used as a benchmark for reasonableness rather than as the answer. The second is residual capacity: which tasks the person still performs, in full or in part, under the restrictions the treating providers have documented, so that only the lost share is valued. The third is duration: the period over which the loss runs, tied to the medical evidence for a temporary loss and to life expectancy for a permanent one, since household work does not stop at retirement and worklife has no bearing on it. The fourth is the wage: the replacement cost of each task at the rate paid in the area to the workers who perform it. Every reduction is shown, so that an opposing expert can see what was subtracted and why.

Replacement-cost valuation and the valuator

Replacement cost prices each task at the wage of the occupation that performs it: childcare workers for the supervision of children, cooks and food preparation workers for meals, maids and housekeeping cleaners for cleaning, landscaping and groundskeeping workers for yard work, home health aides for the care of an adult, and drivers for transportation, taken from the Occupational Employment and Wage Statistics series for the area where the household lives. The report states which occupation was matched to which task, whether the hourly wage or a loaded rate that includes an agency's margin was used, and the survey year of the figure.

The household services valuator on this site applies the same framework to public averages: it takes the hours the American Time Use Survey reports for a person of a given profile and prices them at those occupational wages to give an annual replacement value at the level of a demographic group. It is a starting point for scoping a claim and for checking an opposing figure. The expert analysis replaces the average hours with this household's documented hours, applies the reductions above and extends the figure over the supported period, and it is the expert analysis, not the valuator, that is disclosed and defended.

How a household services engagement proceeds

A household services engagement runs through the six steps below, from the written agreement that fixes scope, conflicts and the retainer to testimony. Two choices at the outset shape everything after: whether the analysis covers one person or a household with dependents, and whether the records document the pre-injury routine well enough to make an interview unnecessary. The household services process page describes each step in full.

Typical timeline

A household services report is typically 30 to 60 days from receipt of complete records, and the run is shortest when the household's routine is documented at engagement and the life care plan, where one exists, is final, because the care hours it schedules come out of the count before anything is priced. Each phase and what moves it is on the household services timeline page.

What a household services engagement costs

The cost of a household services analysis follows the documentation more than the size of the claim: a household whose routine is on record is quantified from the file, and one that is not needs an interview before any hour can be counted. Fees are hourly against a retainer, an estimate comes before work begins, and the household services cost page sets out the drivers and the billing terms.

Who retains a household services analysis

Household services analyses are retained by plaintiff counsel, by defense counsel and by carriers, and the same report serves each. Retained to support a claim, it documents the tasks and hours the household lost and prices them. Retained to test a claim, it examines whether the hours claimed are supported by the record, whether the person's remaining capacity was credited, whether the wage matches the task and the area, whether the period runs past what the medical evidence supports, and whether hours already provided by attendant care in a life care plan were counted twice. The answer comes from the household's facts and the published data, and a report retained by either side can conclude that the loss is smaller, or larger, than the claim states.

Deliverables

The written report identifies the tasks, states the hours before and after the injury with their sources, applies the reductions for residual capacity, duration and overlapping care, matches each task to a replacement occupation and wage, and gives an annual figure with the method laid out for either side to check. Where the case needs present value, the economist's calculation is delivered with it or inside the economic damages report. A critique of an opposing household services figure is a separate written deliverable, scoped when that figure is served. Deposition and trial testimony rests on the report and is given by the expert who prepared it, often beside the economist where both testify.

From the annual figure to present value

The household services report ends at an annual replacement value, and the forensic economist carries it the rest of the way: growth in the replacement wage over the period, the discount rate the forum accepts, and the horizon, which is life expectancy for a permanent loss rather than the worklife expectancy that bounds a lost earnings claim. In a wrongful death case the economist also addresses the services the decedent would have provided to the surviving household, which are the survivors' loss, as distinct from the services the decedent performed for personal benefit. The forensic economics page describes that engagement, and the present value method page explains the discounting. Where one KWVRS engagement covers both, the two reports share one set of dates, one wage source and one horizon.