Enacts the "fair pay for home care act" relating to minimum wages applicable to home care aides; provides for a minimum wage of 150% of the applicable statewide or regional minimum wage.
NEW YORK STATE ASSEMBLY MEMORANDUM IN SUPPORT OF LEGISLATION submitted in accordance with Assembly Rule III, Sec 1(f)
BILL NUMBER: A8821
SPONSOR: Paulin TITLE OF BILL:
An act to amend the public health law, in relation to enacting the "fair
pay for home care act"
PURPOSE OR GENERAL IDEA OF BILL::
To strengthen the ability of New Yorkers to live and age in the communi-
ty by investing in a quality home care system through the establishment
of a minimum wage specific to the home care sector indexed to 150% of
the state minimum wage and ensure provider reimbursement from the state
and managed care organizations operating under Medicaid are sufficient
to fund a high quality system.
SUMMARY OF SPECIFIC PROVISIONS::
Section one of the bill names the act as the "Fair Pay for Home Care
Act"
Section two of the bill amends subdivision 2 of section 3614-f of the
public health law to establish the minimum wage for a home care aide
shall be no less than 150% of the otherwise applicable statewide minimum
wage or applicable regional minimum wage. This section is effective
April 2, 2025.
Section three of the bill amends Section 3614-f of the public health law
by adding five new subdivisions 5, 6, 7, 8 and 9:
5. requires the commissioner of health to establish a regional minimum
hourly base reimbursement rate for all providers employing workers
subject to the minimum wage provisions established by this section and
defines "regional minimum hourly base reimbursement rate"
6 states that no payment made to a provider who employs health care
aides that is less than the regional minimum hourly base reimbursement
rate shall be deemed, adequate; that the commissioner of health shall
submit all necessary applications to apply for approvals/waivers to CMS
to establish regional minimum hourly base reimbursement rates and make
state directed payments to providers; and if approved directed payments
be made to providers through contracts with managed care organizations;
and if not approved, the department shall require plans to justify devi-
ations apart from the regional minimum hourly base reimbursement rates
7.states that nothing in this section precludes providers employing home
care aides from paying or contracting for rates higher than the regional
minimum hourly base reimbursement rate if the parties agree
8. requires the commissioner of health to publish and post regional
minimum hourly base reimbursement rates annually and to advise payment
of those rates to all payers of home care services
9.states that for years in which rate adjustments have not been calcu-
lated prior to start of the calendar year, the prior year's rates shall
remain in place until the new rate is calculated plus annual average
consumer price index urban and rural;
Section four of the bill grants the state comptroller authority to
review contracts between managed care organizations and agencies subject
to provisions of section 3614-f of the public health law to ensure rates
being offered are adequate to meet the department of health actuarial
standards and authorizes the comptroller to develop and promulgate a
process to ensure audits comply with state and, federal law to protect
proprietary information and contracts and if finding that managed care
organizations are not paying sufficient adequate rates, refer such inci-
dents to the department of health and the Medicaid fraud control unit
for enforcement
Section five of the bill requires the Department of Taxation and
Finance, Heath and Labor in consultation with the Office of Temporary
and disability assistance to undertake a study regarding the use of an
expanded state earned income tax credit as a strategy to improve the
home care workforce.
Section six of the bill is the severability clause
Section seven of the bill is the effective date
JUSTIFICATION::
New York has a larger need for home care than ever before and is at the
center of a national home care workforce crisis. Individuals are going
without services or becoming institutionalized because there are not
enough home care workers. Over the next ten years, the Public. Health
Institute estimates that home care, including consumer directed personal
assistance, needs to add more new jobs than any other occupation in the
State.
The consulting firm Mercer estimates that despite this rapid growth
potential, the state will face a shortage of at least 80,000 home care
workers by 2025. One of the primary reasons is that home care aids are
among the lowest paid workers in the state, averaging just $22,000 annu-
al earnings It is reported that fifty seven percent of home care workers
rely on public benefitsto care for their own families.
Despite the state acting in 2022 to raise wages for these workers, early
experience is showing that the increases alone are not enough to meet
the demand by attracting and retaining the high quality workforce that
is needed.
This legislation, (Fair Pay for Home Care) responds to this crisis by
providing a dignified wage equal to 150% of the overall minimum wage to
these workers.
A 2021 study by the CUNY School of Labor and Urban Studies and funded by
the NYS Office for the Aging found that if wages were increased at this
scale, and funded appropriately, the home care workforce shortage may be
solved in less than five years. According to this study, Fair Pay for
Home Care will create almost 18,000 new jobs in local economies through
increased spending capacity of these home care workers.
PRIOR LEGISLATIVE HISTORY::
A6329A of 2021/22 (Gottfried) Similar bill - referred to Ways & Means
FISCAL IMPLICATIONS::
To be determined
EFFECTIVE DATE::
April 2, 2025 with section two effective January 1, 2025
STATE OF NEW YORK
________________________________________________________________________
8821
IN ASSEMBLY
January 18, 2024
___________
Introduced by M. of A. PAULIN -- read once and referred to the Committee
on Health
AN ACT to amend the public health law, in relation to enacting the "fair
pay for home care act"
The People of the State of New York, represented in Senate and Assem-bly, do enact as follows:
1 Section 1. This act shall be known and may be cited as the "fair pay
2 for home care act".
3 § 2. Subdivision 2 of section 3614-f of the public health law, as
4 amended by section 3 of part NN of chapter 57 of the laws of 2023, is
5 amended to read as follows:
6 2. (a) Beginning October first, two thousand twenty-two, in addition
7 to the otherwise applicable minimum wage under section six hundred
8 fifty-two of the labor law, or any otherwise applicable wage rule or
9 order under article nineteen of the labor law, the minimum wage for a
10 home care aide shall be increased by an amount of two dollars and zero
11 cents.
12 (b) [for] For the period January first, two thousand twenty-four
13 through December thirty-first, two thousand twenty-four, the minimum
14 wage for a home care aide shall be as follows:
15 (i) for each hour worked in downstate, eighteen dollars and fifty-five
16 cents; and
17 (ii) for each hour worked in remainder of state, seventeen dollars and
18 fifty-five cents;
19 (c) [for] For the period January first, two thousand twenty-five
20 through [December thirty-first] April first, two thousand twenty-five,
21 the minimum wage for a home care aide shall be as follows:
22 (i) for each hour worked in downstate, nineteen dollars and ten cents;
23 and
24 (ii) for each hour worked in remainder of state, eighteen dollars and
25 ten cents;
26 (d) [for] For the period [January first, two thousand twenty-six
27 through December thirty-first, two thousand twenty-six, the minimum wage
28 for a home care aide shall be as follows:
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[] is old law to be omitted.
LBD13749-01-3
A. 8821 2
1 (i) for each hour worked in downstate, nineteen dollars and sixty-five
2 cents; and
3 (ii) for each hour worked in remainder of state, eighteen dollars and
4 sixty-five cents;
5 (e) beginning January first, two thousand twenty-seven, and each Janu-
6 ary first thereafter, the minimum wage for a home care aide shall be the
7 sum of the minimum wage for a home care aide from the prior calendar
8 year and the home care worker wage adjustment.
9 (f) (i) Notwithstanding any provision of law to the contrary, in no
10 event shall the minimum wage for a home care aide in downstate exceed
11 the sum of the wage set by the commissioner of labor pursuant to para-
12 graph (a) of subdivision one-b of section six hundred fifty-two of the
13 labor law plus three dollars and zero cents.
14 (ii) Notwithstanding any provision of law to the contrary, in no event
15 shall the minimum wage for a home care aide in remainder of state exceed
16 the sum of the wage set by the commissioner of labor pursuant to para-
17 graph (b) of subdivision one-b of section six hundred fifty-two of the
18 labor law plus three dollars and zero cents] on and after April second,
19 two thousand twenty-five, the minimum wage for a home care aide shall be
20 no less than one hundred fifty percent of the applicable statewide mini-
21 mum wage or applicable regional minimum wage pursuant to section six
22 hundred fifty-two of the labor law.
23 § 3. Section 3614-f of the public health law is amended by adding five
24 new subdivisions 5, 6, 7, 8 and 9 to read as follows:
25 5. (a) The commissioner shall establish a regional minimum hourly base
26 reimbursement rate for all providers employing workers subject to the
27 minimum wage provisions established in subdivision two of this section.
28 The regional minimum hourly base reimbursement rate shall be based on
29 regions established by the commissioner, provided that for areas subject
30 to section thirty-six hundred fourteen-c of this article, each area with
31 a different prevailing rate of total compensation, as defined in such
32 section, shall be its own region.
33 (b) For the purposes of this section, "regional minimum hourly base
34 reimbursement rate" means a reimbursement rate that reflects the average
35 combined costs associated with the provision of direct service inclusive
36 of, but not limited to:
37 (i) overtime costs;
38 (ii) transportation costs;
39 (iii) all benefits;
40 (iv) all payroll taxes, including but not limited to the federal
41 insurance contributions act, medicare, the federal unemployment tax act,
42 state unemployment insurance, disability insurance, workers' compen-
43 sation, and the metropolitan transportation authority tax;
44 (v) related increases tied to base wages such as compression;
45 (vi) reasonable administrative costs as defined by the commissioner;
46 (vii) allowances for capital costs;
47 (viii) the development of profit or reserves as allowable by law or
48 regulations of the commissioner; and
49 (ix) any additional supplemental payments.
50 (c) Following the initial established regional minimum hourly base
51 reimbursement rate established under this section, the commissioner
52 shall annually adjust the regional minimum hourly base reimbursement
53 rate for each region by a trend factor to reflect and accommodate any
54 additional labor law increases, changes or mandates. Updated rates shall
55 be made publicly available the first day of each October thereafter for
56 use on the first day of January of the following year.
A. 8821 3
1 6. (a) No payment made to a provider who employs home care aides
2 subject to this section that is less than the regional minimum hourly
3 base reimbursement rate established pursuant to subdivision five of this
4 section for services provided under authorization by a local department
5 of social services, a managed care provider under section three hundred
6 sixty-four-j of the social services law, or a managed long-term care
7 provider under section forty-four hundred three-f of this chapter shall
8 be deemed adequate.
9 (b) The commissioner shall submit any and all necessary applications
10 for approvals and/or waivers to the federal centers for medicare and
11 medicaid services to secure approval to establish regional minimum hour-
12 ly base reimbursement rates and make state-directed payments to provid-
13 ers for the purposes of supporting wage increases.
14 (i) If approved, directed payments shall be made to such providers of
15 medicaid services through contracts with managed care organizations
16 where applicable, provided that the commissioner ensures that such
17 directed payments are in accordance with the terms of this section.
18 (ii) If the state directed payment is not approved, the department
19 shall require plans to justify deviations apart from the regional mini-
20 mum hourly base reimbursement rates.
21 (c) The commissioner shall ensure that managed care capitation is
22 adjusted to ensure rate adequacy for the managed care organizations in
23 order to comply with this section.
24 7. Nothing in this section shall preclude providers employing home
25 care aides covered under this section or payers from paying or contract-
26 ing for services at rates higher than the regional minimum hourly base
27 reimbursement rate if the parties agree to such terms.
28 8. The commissioner shall publish and post regional minimum hourly
29 base reimbursement rates annually and shall take all necessary steps to
30 advise commercial and government programs payers of home care services
31 of the regional minimum hourly base reimbursement rates and require
32 other state authorized payers to reimburse providers of home care
33 services at the regional minimum hourly base reimbursement rate.
34 9. For years in which rate adjustments to the regional minimum hourly
35 base reimbursement rate have not been calculated prior to the start of
36 the calendar year, the previous year's rate shall remain in place until
37 the new rate is calculated, plus the annual average consumer price
38 index-urban or consumer price index-rural, as applicable. If it is
39 determined that retroactive rate adjustments are necessary, payment
40 adjustments will be made as a direct pass through to providers within
41 sixty days of the adjusted rate.
42 § 4. To ensure compliance with this minimum wage increase, the comp-
43 troller shall have the authority to review the contracts entered into
44 between a managed care organization and a licensed home care services
45 agency, fiscal intermediary, or any agency subject to the provisions of
46 section 3614-f of the public health law to ensure that rates being
47 offered are adequate and meet the department of health's actuarial stan-
48 dards. The comptroller, in consultation with the medicaid fraud control
49 unit, may develop and promulgate a process to ensure such audits comply
50 with state and federal law to protect proprietary information and
51 contracts. In the event that the comptroller finds evidence that managed
52 care organizations are not paying sufficient adequate rates, they will
53 refer such instances to the department of health and the medicaid fraud
54 control unit for enforcement. If the department of health or the medi-
55 caid fraud control unit chooses not to pursue action related to this
56 referral, it shall inform, in writing, the comptroller's office as to
A. 8821 4
1 the reasoning. Such reports, and the department of health's responses,
2 shall be public information and made available on the comptroller's
3 website. For the purposes of this section, the term "managed care organ-
4 ization" shall mean an entity operating pursuant to section 364-j of the
5 social services law or article 44 of the public health law.
6 § 5. 1. The commissioners of the departments of taxation and finance,
7 health and labor, in consultation with the office of temporary and disa-
8 bility assistance, shall undertake a study regarding the use of an
9 expanded state earned income tax credit as a strategy to improve the
10 home care aide workforce. Such study shall include an evaluation of
11 issues, including but not limited to:
12 a. the range of increase needed to increase total compensation to the
13 median compensation by county and/or region;
14 b. implementation challenges related to a specific sector enhanced
15 earned income credit;
16 c. possible effects on worker recruitment and retention;
17 d. fiscal impact on the state; and
18 e. any other issues as determined by the commissioners and depart-
19 ments.
20 2. The study shall include a public hearing and/or other processes to
21 gather information from all interested parties. The commissioner of
22 taxation and finance shall report the findings of the study no later
23 than nine months after the effective date of this act or December 31,
24 2024, whichever is sooner.
25 § 6. Severability. If any provision of this act, or any application
26 of any provision of this act, is held to be invalid, or to violate or be
27 inconsistent with any federal law or regulation, that shall not affect
28 the validity or effectiveness of any other provision of this act, or any
29 other application of any provision of this act which can be given effect
30 without that provision or application; and to that end, the provisions
31 and applications of this act are severable.
32 § 7. This act shall take effect immediately; provided, however, that
33 section two of this act shall take effect January 1, 2025.
