New Rules For Hiring Home Health Aides
Federal regulations will guarantee them minimum wage and overtime pay starting in 2015, which could crimp some families' budgets
The numbers are clear: If there is one thing we can be sure of as our generation ages, it's that there will be fewer people around to care for us, especially if our collective life expectancy continues to creep northward.
An AARP Public Policy Institute report put the problem in stark relief: Its "caregiver support ratio," defined as the number of potential caregivers for every person over 80 in the prime age group of 45-64 (unpaid family members and paid home aides) was 7 to 1 in 2010. By 2030, four years after the first boomers turn 80, however, the ratio will have plummeted to 4 to 1 and it will continue to drop until hitting 3 to 1 in 2050.
According to the report, about 14 percent of adults in the prime caregiving age group actually provided care for someone over age 80 in 2009; another 14 percent assisted someone younger than 80. To put it in perspective, more than half of adults 80 or older today have a severe disability and about a third need help bathing, dressing, cooking or performing other routine activities. There will be about 20 million Americans age 80 or older in 2030 and 34 million by 2050, based on latest population estimates.
(MORE: How to Hire (and When to Fire) a Caregiver)
"What these numbers tell us is that relying on family and friends to provide long-term care may be unrealistic in the future," AARP senior strategic policy adviser Lynn Feinberg told The New York Times. "We need to be thinking about new approaches to financing and delivering long-term services and supports, particularly home and community-based services, which are what most people want."
New Rights for Workers
The cost of home health aides, however, is about to increase for many families.
New federal regulations that guarantee minimum wage and overtime protection to the nation's home health care workers were approved by the White House on September 17. The rules close what had long been seen as a loophole in U.S. labor law, dating back to the passage of the Fair Labor Standards Act of 1938, and the changes have been widely celebrated by labor advocates.
"Home care workers provide crucial in-home care and support for our elderly or disabled family members, friends, and neighbors; yet these workers have struggled to support their own families," Christine Owens, executive director of the National Employment Law Project, told Msnbc.com.
The new rules "will provide a floor for domestic workers for generations to build toward their dreams," Ai-jen Poo, the director of the National Domestic Workers Alliance, wrote in Politico.
Previously, home health aides had been excluded from federal protections because of wording intended only to exempt informal care arrangements, like babysitting. By 2020, there will be an estimated 4 million home health care workers in the U.S. More than 90 percent of their current work force are women and 56 percent are nonwhite. Almost 40 percent of these workers qualify for federal benefits such as food stamps or Medicaid. And while a majority are already paid more than the federal minimum wage, many work more than 40 hours a week without receiving overtime pay.
The changes will most directly impact families who hire home health aides through staffing agencies. The OT shift alone could significantly increase the cost of home health care.
Supporters of the new regulations insist that, along with helping home health aides better make ends meet, they will help improve the quality of care. That's because, they say, the higher pay would likely increase interest in the field, ensure greater rewards for better-trained workers and limit turnover. Opponents have complained that the protections will have unintended effects, hurting workers and those who need care.
(MORE: Is Your Loved One's Caregiver Qualified?)
"Faced with higher costs, some individuals will have no choice but to leave their homes and enter institutional living," U.S. Reps. John Kline (R-Minn.) and Tim Walberg (R-Mich.) said in a statement about the new rules.
If that were to happen, the costs to taxpayers through Medicaid reimbursements could rise. A semi-private nursing home room costs about $75,000 per year, while a 40-hour-a-week home health aide runs roughly $44,000 annually.
Andrea Devoti of the National Association for Home Care and Hospice, an industry trade group, told The Wall Street Journal: "Home-care companies will have little choice but to employ workers part-time rather than full-time as Medicaid payment rates and consumers with limited incomes cannot afford higher costs. Caregivers will in the end receive less pay."
The White House, however, does not believe that will be the case. Fifteen states already guarantee home health aides the benefits covered by the new federal regulations, the administration has noted, and there has been no data indicating that workers have lost their jobs or experienced significant financial impact. (Live-in health aides remain exempt from overtime rules, but must now be paid minimum wage for all hours worked.)
Changes in federal regulations typically go into force 60 days after they're approved, but the Department of Labor has delayed enforcement of the home health worker rules until January 1, 2015 to give families, home-care agencies and state Medicaid programs time to prepare. Nearly three-quarters of home health aide costs are paid for with public dollars.
Some industry leaders welcome the changes and believe they will benefit companies that have always paid their workers responsibly.
"It levels the playing field with companies that don't pay minimum wage and overtime to these workers," Ben Bledsoe, president of Consumer Direct Management Solutions, which operates health-care agencies in 11 states, told The Wall Street Journal. The businesses that will be hurt by the new rules, he said, are those that "haven't been doing this all along."
Still, many individuals and families may ignore the new rules because they hire and pay home health aides (many of them undocumented immigrants) under the table. Proposed changes in immigration law that would create a new class of visa with a potential path to citizenship for low-skill workers, including home care aides, have not yet received Congressional approval.