New York State Budget Leaves Home Care Providers ‘Vulnerable’

For months, organizations and individuals alike have rallied and advocated for higher wages for home care workers in New York.

The Fair Pay for Home Care Act – which gained considerable traction in the state – seems to have hit a wall. And although higher home care worker wages are a part of the state’s recently finalized budget, it’s not what workers or providers were hoping for.

Firstly, the wage increases are relatively small. The minimum wage for home care workers will increase by $2 on Oct. 1, then will increase again by a dollar a year after that. 

The Fair Pay for Home Care Act also would have made wage increases commensurate with reimbursement increases for Medicaid-based home care providers. The state’s budget, on the other hand, does nothing to link increasing wages to Medicaid reimbursement.

“We remain concerned that the budget’s incremental increase of $3 an hour for home care workers over a two-year period – although a step in the right direction – may not be enough,” Kathy Febraio, the president and CEO of the New York State Association of Health Care Providers (HCP), said in a statement shared with Home Health Care News. “The budget did not address our core concern that any wage increase be fully funded with a linked Medicaid reimbursement rate for home care agencies. Our industry’s past experience with wage increases has shown repeatedly that this does not happen without it being required to happen.”

Providers have expressed similar sentiments in the past.

Although they are generally initially considered when it comes to mandated wage increases, they’re often left behind in final legislation, as HCP and other organizations fear they are now.

“When they introduce these kinds of bills, we always ask for a fiscal study on what it’s going to cost,” Darby Anderson, the chief strategy officer at Addus HomeCare Corporation (Nasdaq: ADUS), previously told HHCN. “Because they don’t factor in the Medicaid provider networks.”

Febraio also doesn’t believe that the home care wage increases will ultimately be competitive enough.

Providers, after all, are not losing workers to each other necessarily. Instead, they’re losing them to other industries, such as retail and fast food.

“New York’s statewide home care industry crisis continues, and this was the state’s opportunity to address it,” she said. “Home care wages need to be competitive and commensurate with the level of care and the skills demanded of these dedicated workers.”

There is also $1.2 billion dedicated to front-line health care worker bonuses in the budget, but HCP is additionally concerned that those won’t be available to home care workers. 

The Home Care Association of New York State (HCA-NYS) is likewise uneasy with the finalized budget and the effect it could have on the industry in the state.

“There remains a lot of uncertainty – particularly around whether and how the wage mandate will be funded, which has the potential to leave agencies in an extremely vulnerable position,” Alexandra Fitz Blais, the chief of external and strategic affairs for HCA-NYS, told HHCN. “We are obviously very grateful for the recognition and support of the legislature and the executive, but without adequate funding this could be devastating to the industry.”

All in all, the budget agreement includes a $20 billion “multi-year health care investment,” according to New York Gov. Kathy Hochul’s office. Included in that is the $1.2 billion of bonuses and $7.7 billion for home care worker increases, among other provisions.

Both HCP and HCA-NYS expressed gratitude for the policymakers that did bring home care to the forefront of conversations.

But at the end of the day, the industry doesn’t believe the state’s lawmakers – as a collective – came through.

“We are grateful to Sen. [Rachel] May, and Assemblyman [Richard] Gottfried, along with countless other legislators and advocates who did an extraordinary job bringing attention to in fighting for home care,” Febraio said. “[But] our industry cannot sustain wage increases without corresponding reimbursement increases. We will need to continue that fight in what remains of the legislative season.”