At least 19 states are actively implementing strategies to address direct care worker wages through reporting and/or enforcement mechanisms, a report issued this week by the National Governors Association Center for Best Practices found.
“Although many healthcare providers have received rate increases through temporary federal COVID-19 relief and state funding, only a limited number of states have policies to ensure funds are passed on to direct care workers,” the report stated. “The direct care workforce represents a critical component of the United States employment market, yet pay remains low. States have taken a variety of actions through provider rate increases and minimum wage policies through the Medicaid program as two strategies to address recruitment and retention.”
The report is the third in a series on the direct care workforce.
Medicaid is the largest payer for facility-based and home and community based settings care, paying for 42.1% of all long-term services and supports in 2020.
The report summarized approaches in 19 states to increase wages, with a focus on those that have reporting requirements, enforcement vehicles or other mechanisms to help ensure funds go to intended recipients.
In Illinois, for example, state officials are trying to support direct care workers and CNA retention with supplemental payments to providers that prove certain CNA tenure metrics. Retained workers are supposed to receive an extra $1.50 hourly for the first year retained, and then $1 more hourly for every additional year, up to a max of $6.50 per hour. In addition, CNAs can receive $1.50 per hour for promotions associated with additional training and skills like dementia care and/or responsibility levels
Providers are required to report on costs and revenue, but there is no enforcement policy in place.
The program started last July as part of larger rate methodology reform efforts, Matt Hartman, executive director of the Illinois Healthcare Association, told McKnight’s Long-Term Care News Thursday. The youth of the program means impact is to be determined, Hartman said.
“To date over a third of (nursing home) providers are taking part, and we expect participation to continue to grow,” Hartman said. “That said, there are probably some ways in which additional providers could be enticed to participate, and thereby improve the program.
“Most of these would center around additional ways funding could be passed through to employees, and some flexibilities in how the program is managed.”
The report notes that benefits, such as health insurance, paid time off, childcare and transportation, also represent important tools that states can use as recruiting and retention tools.
“These strategies have a clear monetary value and these non-wage benefits can give employers a competitive advantage over other professions that may offer similar or even slightly higher wages without such benefits,” the report said.
The report noted two types of strategies. A wage/benefit increase through a rate increase or supplement, as a payment in addition to the statewide provider rate. In addition to programs like the one in Illinois, these strategies include enhanced payments for meeting overall performance metrics, such as in Rhode Island; or formula-based enhancement such as one provided in Iowa that requires a wage pass through.
Some states are also pursuing minimum wage hikes for all direct care workers, as in Florida, or a specific category of direct care workers, as in Louisiana. In New Jersey, a minimum wage for direct care workers is a specific percentage or dollar amount above the state minimum wage.
“Importantly, states may implement multiple strategies to address direct care worker wages, which may intersect in important ways,” the report said.