National Council on Medicaid Home Care Calls for a Summit on the Medicaid Impact of the ACA Employer Mandate and New Overtime Compensation Rules
January 3, 2014 07:58 AM
The National Council on Medicaid Home Care, a NAHC affiliate, has call on the Centers for Medicare and Medicaid Services (CMS) to convene a stakeholder summit to develop reasoned solutions to the challenges facing Medicaid home care under the Affordable Care Act and the recent overtime rule change issued by the Department of Labor.
Beginning January 2015, providers of Medicaid home care services will face the daunting task of complying with two significant changes in the law that could significantly increase care costs. At the same time, state Medicaid programs and their managed care contractors have not shown any willingness to increase payment rates.
The employer mandate under the Affordable Care Act may trigger an employer’s obligation to offer health insurance or face a $2000 penalty for each employee working 30 hours or more per week. A Council survey indicates that an estimated 67% of Medicaid home care providers currently do not offer health insurance to personal care aides.
Additionally, the recent changes to the Fair Labor Standards Act rules by the Department of Labor will require overtime compensation to personal care aides working more than 40 hours weekly. Live-in workers will be affected as well when they are employed by a home care company.
In an effort to find reasonable and workable solutions to these challenges, the Medicaid Council has proposed that CMS convene a “summit” of stakeholders with the design to explore the options and solutions to address these new requirements. The concept has the support of a number of other stakeholders including representatives of persons with disabilities and worker advocates.
A number of states already cope with an overtime compensation requirement. Also, some states are taking new approaches to insuring home care workers, using Medicaid as a foundation. The Council expressed a need to address these issues well before January 2015 as it will be impossible for Medicaid home care providers to continue care since they cannot afford overtime, health insurance, or the penalty obligation without limiting working hours or dropping compensation to minimum wage levels.
Earlier this year, the Council met with the head of the HHS health care reform efforts on this matter. That meeting left a strong impression that HHS wants to find solutions. However, no action has surfaced to date.
The summit would bring in representatives from all stakeholder sectors: consumers, Medicaid state programs, CMS, workers, and agency model providers. It would start with a clean slate in terms of what changes, if any, state Medicaid programs might be needed to maintain access to high quality home care services in light of the overtime rule change and the upcoming ACA responsibilities. The Council recommended that CMS draw in parties from states that already have comparable wage requirements in place, such as Pennsylvania and Michigan, along with states that will see the change in 2015. Similarly, the Council explained that states with innovative approaches to worker health insurance would be valuable participants.
The purpose of the gathering would be to develop all the possible (reasonable) options and alternatives available to state Medicaid programs that could lead to maintaining care delivery. From there, the stakeholders/CMS could develop a tool that states could use to understand these options and implement the one(s) that the states feel fit best for their unique situation. This would not mean any mandate from CMS, just helpful guidance. This approach would put the issue ultimately on each state’s “radar” as an important issue while recognizing that the solution is not a one size fits all.
The Council expressed the belief that the proposed summit would be very useful in exploring all the alternatives to simply raising payment rates to cover any increased cost triggered by these changes. It would also be valuable in bringing together the various stakeholders that have been at odds with each other rather than recognizing that we share common goals. It also is probably the best chance that the President’s goals behind these changes can be achieved.
The Council has had discussions with some members of Congress about their support for the summit proposal. It is hoped that the summit could take place in early 2014. For further information on the proposal, contact Bill Dombi, Executive Director of the Medicaid Council at firstname.lastname@example.org.