New rules to lift health workers' pay

New rules to lift health workers' pay

December 23rd, 2011 by Judy Walton in News


• Alabama: 13,5563

• Georgia: 21,183

• Tennessee: 17,939

Source: U.S. Census Bureau

In-home health care workers - aides, mostly women, who tend the elderly and infirm - would be entitled to earn minimum wage and overtime pay under rules proposed last week by the U.S. Labor Department.

Nearly 50,000 workers in Tennessee, Alabama and Georgia are among more than 2 million nationwide who could see significant pay boosts if the rules are adopted, officials said.

Announcing the proposed rules Dec. 15, President Barack Obama said bringing home health care workers under the federal Fair Labor Standards Act "will ensure that these men and women get paid fairly for a service that a growing number of older Americans couldn't live without."

But the Chattanooga owner of a home health care service said the rules could make the service too costly.

"As a nonmedical company and as a small business owner, we can't afford to charge time and a half. It's just not affordable for people to have to pay more," said James Gardenhire, owner of Home Instead Senior Care.

The market for in-home health care is growing as the U.S. population ages. According to the Alliance for Retired Americans, the number of people over age 65 is expected to grow from 40 million to 72 million by 2030, and government estimates show that 27 million will need home care by 2050.

The proposed rule change targets companies such as Home Instead and Cleveland, Tenn.-based Life Care Centers of America.

According to Labor Department information, the 1974 Fair Labor Standards Act exempted "companions" or "casual baby sitters" for the sick and aged from minimum wage and overtime rules.

But the department said the 1.79 million active home care workers are "professional caregivers" and the vast majority - 1.59 million - work for staffing agencies.

"More than 92 percent are women, nearly 30 percent are African-American, 12 percent are Hispanic and close to 40 percent rely on public benefits such as Medicaid and food stamps," the Labor Department said.

The average such worker earns between $17,000 and $20,000 a year, according to information from the Alliance for Retired Americans.

The rule change would apply to all home care workers employed by third parties, such as staffing agencies, but not those working for families or truly providing only companionship and protection.

How many workers?

The Obama administration said the proposed rule change is a reaction to a 2007 Supreme Court ruling that a home caregiver who worked as many as 70 hours as week was not entitled to overtime pay under the Fair Labor Standards Act.

Obama said the Labor Department is attempting to revise the rules administratively after several bills to do so could not get through Congress.

It's hard to tell how many area workers would be affected by the rule. U.S. Census Bureau figures show about 13,500 such workers in Alabama, 21,000 in Georgia and 18,000 in Tennessee.

But that number could include skilled professionals as well as basic caregivers, Tennessee Health Department spokeswoman Shelley Walker said.

"For example, individuals providing home health services may be nurses, physical therapists, respiratory therapists, etc. But not all individuals within such categories of licensees provide home health services," Walker said.

Life Care Centers of America offers Life Care at Home in Tennessee and eight other states, according to its website. Company officials did not respond to several requests for comment.

Paul Hogan, the president of Omaha, Neb.-based At Home Instead, said in an email that company officials are studying the proposed rule change but hope the companionship exemption to the Fair Labor Standards Act will not change.

Hogan At Home Instead has more than 600 franchise offices in the U.S. and 17 countries employing more than 65,000 caregivers.

"The companionship exemption is a significant factor in helping to keep paid, senior caregiving affordable while lessening the dependence on care facilities for those who, when receiving support, are able to age at home," Hogan said.

"The companionship exemption helps seniors protect their assets while receiving the right amount of care; helps preserve and create jobs; and preserves government resources expended through nursing home facilities," he said.