More People Delivering In-Home Care, Can You Afford Them?

2 Comments

Thanks to the growing needs of the rapidly aging baby boom generation, the number of home health care workers in the U.S. will greatly increase over the next decade, according to the National Bureau of Labor Statistics (BLS).

A newly released BLS report indicates that the number of home health aides in the U.S. is expected to grow 69 percent over the next nine years, creating an additional 706,300 jobs by the year 2020.

This is welcome news for both a faltering economy and the legions of family caregivers struggling to take care of elderly loved ones. But, the question on the minds of many of these caregivers is: Can I afford a home health aide for my elderly loved one?

According to BLS data, in 2008, the average hourly cost of a certified home health aide was $32. The hourly cost of a non-certified home health aide was $19. Depending on the level of care a senior needs, these rates may end up costing an elder and their family hundreds, even thousands, of dollars per week.

Medicare covers home health aide services only when it is given in conjunction with doctor-prescribed skilled nursing care, or therapy (physical, speech, occupational). The only care covered is temporary or intermittent care—if an elderly loved one needs round the clock in-home care, Medicare will not pay for it.

Up until now, people providing in-home care for the elderly and disabled have been exempt from the minimum wage and overtime pay requirements of the Fair Labor Standards Act of 1975. Home care workers are currently classified as "companions," so home health care agencies do not have to pay them the $7.25 an hour minimum set by the federal government, or offer them overtime pay if they work more than 40 hours per week.

The U.S. Department of Labor (DOL) has recently proposed that this classification be overturned, arguing that home health aides are skilled workers who provide a wide array of services that makes them more than just "companions." Also, noted in the DOL report was the fact that research has indicated that sub-par wages for home health care workers is interfering with initiatives aimed to improve the quality of care received by the elderly and disabled.

Occupying the other side of the fence, some organizations, such as the National Association for Home Care and Hospice (NAHC), feel that overturning the "companionship exemption" would cause the cost of in-home care to increase to unaffordable levels. In an NAHC press release, the association states that raising the costs for home health care providers without increasing the amount of government reimbursement they receive would likely serve to shift the cost of the wage increase to the people paying for care.

Still, it's difficult to predict the impact that a national mandate would have on the overall cost of home health care for the elderly. Many states have already decided to do away with the "companion exemption," and, a good portion of home health agencies pay their workers more than $7.25 an hour. In fact, the average pay for a home health aide working in 2010 was $10.46 per hour, several dollars above the current minimum wage.

You May Also Like

Free AgingCare Guides

Get the latest care advice and articles delivered to your inbox!

2 Comments

The National Association of Home Care and Hospice and many other industry groups take issue with the Department of Labor's proposal to do away with the minimum wage/overtime exemption not on the basis of the minimum wage part of the exemption. As stated in the article, virtually all reputable home care companies already pay their direct care workers considerably more than minimum wage. The objection to doing away with the "companionship exemption" is mostly based on the overtime issue. If someone needs 24-hour care, the new regulation would mean that a person providing that care could not even provide two days of care without being paid overtime, even though the overnight hours are mostly sleep time, and there is a fair amount of "down time" during the day hours as well. This would result either in much higher costs to the care recipient to cover the overtime, or a revolving door of aids to avoid any one of them from going into overtime. Neither of these options is good for the care recipient or the direct care workers. The other problem is that the Department of Labor, in researching the impact of the proposed change, relied on figures only from medicare and medicaid records, while the majority of care impacted by the exemption is private pay and has no relationship with medicare and medicaid whatsoever. This is a complex issue, and the DOL has extended the public comment period to allow for more time to gather information from the public, and to look again at their own figures.
b4 - fabulous comment. The overtime issue is going to be the pivot point on affordability. I don't think most folks realize what & how overtime costs and limits as most businesses & employees are about straight time or making sure you work under 20/30/40 hrs a weeks so that you are not full-time or so that benefits don't have to be paid. I work in an industry (film) where OT can be paid and there are strict rules on down-time minimums. But you can't do that in caregiving.

If the reg's do away with the "companionship exemption", there will be a huge increase in under the table payment of workers (many undocumented) for taking care of the elderly. I see this right now in my moms's neighborhood which has about 40% elderly homeowners...most families who can't be caregivers go an hire an agency; then after a few months can't afford it; then get undocumented to come in and "watch" grandma. (note:I don't have an issue with the workers legal status - that's a whole other issue not for this forum, per se.) But often the problem is low cost workers do not have health care training to do the care really needed. DOL is in a tough spot as the data on off the books caregiving isn't there for them to use.

Doing away with the exemption will, I think, push even more elderly into LTC/NH
as they can qualify for Medicaid coverage even though they could stay in their home if the $ spend for Medicaid room & board could be spent by the family for
in-home caregivers.I am really concerned about oncoming tsunami of the costs of health care that will happen in the US in 2020/2025 and beyond when so many of the boomers flat run out of $ and have to go into the Medicaid system.