Nichols said she could certainly use the money. Even after three raises over the past four years, she acknowledges paying the bills isn't easy on her $8.75-an-hour basic wage, even though she supports only herself.
A proposed federal rule, which could be issued by the Obama administration as soon as April 1, would likely improve her financial prospects. The proposal aims to redefine companion services, making medically related tasks that require special training eligible for overtime.
Still, the limited lifting of the exemption has drawn stiff opposition from the home healthcare industry, which has grown to a $50 billion-a-year business. The government received more than 1,400 public comments on the proposed rule last year.
Home-care trade groups say they can't afford to pay increased wages. Medicare and Medicaid pay for most of the services and those revenue streams aren't increasing anytime soon, said William Dombi, the vice president for law at the National Association for Home Care & Hospice. Dombi noted the federal government's reimbursement formula ignores overtime pay.
Unions representing home-care workers have been quiet about the rule since bringing the litigation that led to a Supreme Court ruling in the 2007 case, Long Island Care at Home, Ltd. v. Coke, that upheld the exemption. SEIU officials did not return requests for comment.
The demand for home-care services will continue to rise in the coming decade, industry officials say. “On the Medicaid side, there's been a huge shift away from group homes and more institutional care through the waiver program to providing support to individuals and seniors with disabilities in their homes funded by Medicaid dollars,” said Gale Bohling, legislative director for the Home Care Association of America.
While the Labor Department counts only 1.3 million home healthcare workers in the U.S., the Paraprofessional Healthcare Institute, a New York-based worker advocacy group, estimates the total number of direct-care workers is 3.4 million, which it said will swell to 5 million by 2020.
Opposition to the pay hike hasn't come only from industry groups. Client advocacy groups also protested, saying the elderly and disabled on fixed incomes can't afford to pay increased wages.
AARP, on the other hand, backed the narrowing of the definition of services that will be included in the exemption. The nation's largest senior advocacy group also called for requiring third-party agencies to be responsible for any increase in wages, not the clients.
The proposed rule still excludes live-in home-care workers from being eligible for overtime pay, a policy that some state lawmakers have already adopted. That's proof that the industry won't unravel, said Steven Edelstein, PHI's national policy director. The group points to the 15 states that already offer minimum wage and overtime guarantees. They include Maine, Massachusetts and New Jersey, which give home-care workers minimum wage and overtime pay protection without restrictions. Six states and the District of Columbia provide for minimum wage protection, but don't offer overtime pay.
California runs a $5 billion-a-year In-home Supportive Services public entitlement program for low-income disabled residents. It's the largest program of its kind in the country, with 442,000 clients. Federal Medicaid pays for half the program, with the state and county paying the rest. Paying overtime to providers in the program would cost $200 million for the 50,000 workers who put in more than 40 hours a week, according to comments submitted by state officials.
Advocacy groups, echoing complaints by the companies that supply home-care workers, fret that their clientele will be stuck with the bill for the increased overtime pay. “People with disabilities are not in the same category as rich families who use nannies,” said Deborah Doctor, legislative advocate for Disability Rights California. “People with disabilities tend to be low income and use personal assistants because without them, they couldn't get out of bed or function or go to work. And yet these personal assistants are kind of lumped in with the nannies who work for rich people.”
Organizations representing home-care workers say their members have earned the same benefits as those holding similar positions in hospitals. This is a social justice issue, said Terry Bucher of the Florida Professional Association of Care Givers. She stressed that caring for the elderly at home is a difficult, physical job that deserves increased compensation. Home-care workers suffer a disproportionate number of back injuries, she noted.
Bucher said her group struggles to recruit young people to the profession because of its low wages. Home-health aides earned an average of $21,820 a year in 2011, according to the Labor Department. Pay for the aides ranges from a median of $8.47 an hour in Mississippi to $12.24 in North Dakota with the national median at $9.49, according to PHI data. The overwhelming majority of home-care workers are women.
Industry officials say the rule could lead home-care providers to cut work hours to avoid paying overtime. They may also split hours by sending two workers out to one client, said Bohling of the Home Care Association. That would also cut the workers' earnings and could confuse the patient. The continuity of care is an important issue since many home-care patients have memory issues. However, PHI claims that overtime affects only about 10% of direct-care workers, a number industry officials did not contradict.
Losing money through a reduction of hours is a scary thought for Nichols. She's worried about co-workers who struggle to find steady work as a home health aide. About half of direct-care workers work part time, according to PHI.
“I'm doing OK now, but if I get a new car, what happens?” she said. “Your client could pass away at any time.”
