The Center on Budget and Policy Priorities (CBPP) says the situation has already led at least 39 states to cut funding for various services, including public health programs and programs for elders and people with disabilities.

According to the CPBB,

At least 22 states, plus the District of Columbia are cutting medical, rehabilitative, home care, or other services needed by low-income people who are elderly or have disabilities, or significantly increasing the cost of these services. For example, Florida has frozen reimbursements to nursing homes and relaxed staffing standards, Nevada is making it harder for beneficiaries to qualify for nursing home care, and Rhode Island is requiring low-income elderly people to pay more for adult daycare (“An Update on State Budget Cuts,” June 29).

Federal recovery act money and tax increases are helping to offset some of the effects of these cuts, says the CPBB, “but only to a point.”

Here are a few snapshots of what’s happening in several states:

California

California failed to meet their budget deadline on June 30, thus putting Medicaid and other states services at risk of significant cuts. According to McKnight’s,  the California Association of Healthcare Facilities (CAHF) indicated that even though California has begun issuing IOUs in lieu of payment to several state agencies, it will keep issuing warrants to skilled nursing and disability care providers through July. However, CAHF also “strongly recommends [that] providers prepare for possible contingencies… in the event that the state can’t borrow sufficient cash to meet its expense needs.”

New York

State controller Thomas DiNapoli said on July 5 that New York is headed for a “budget free fall” if Democratic Gov. David Paterson and the state legislature fail to slash the summer budget (“Plunging revenue causes new problems,” Stateline.org, July 9). This comes after a partisan deadlock in the state Senate caused New York to enter fiscal year 2010 without a budget in place. On July 6 he told the New York Daily News that while his state’s condition isn’t quite as bad as that of California — which is now paying bills with IOUs thanks to its budget gap – “we certainly have a budget that appears not to be holding together.”

According to PHI New York Policy Director Carol Rodat, “New York’s Fiscal Year 2010 budget, already deemed to be out of balance, contains $160.28 million in home care cuts and $449.2 million in nursing home cuts. While these cuts reflect the rejection of much larger cuts originally proposed by the Governor, those interested in services and supports for the elderly and people living with disabilities can expect to fight the budget battles once more, perhaps before year end.”

Ohio

Governor Ted Strickland, faced with a $3.2 billion budget deficit, has proposed a cut to the state’s Passport program, which helps seniors stay at home instead of moving into nursing homes. The program is paid for by state Medicaid funds (“Seniors’ home-based care could be cut,” Wilmington News Journal, July 2). He told the Washington Post, “For a lot of people, there is a continuing failure to recognize the severity of what is happening with this economy. . . . Programs will be reduced. Some programs will be eliminated” (“States Straining to Repair Budgets,” July 7).

Michigan

Facing one of the ten worst budget gaps in the U.S and a 36% decline in state revenue since last year, Michigan lawmakers are considering an 8 percent ($94.9-million) cut in Medicaid fees paid to physicians, hospitals, and others. The state Senate has already approved the cut, and lawmakers from both the Senate and House will be working in coming weeks on hammering out a budget before October 1, the start of Michigan’s new fiscal year. Richard E. Smith, MD, President of the Michigan State Medical Society, estimates that federal matching funds will be reduced by more than twice the state cut (“Michigan Senate Oks 8% Medicaid Fee Cut,” American Medical News, July 8). Additionally, cuts to Michigan’s local public health program are already impacting some local health services and departments.

Pennsylvania

Pennsylvania failed to approve a budget in time for the beginning of fiscal year 2010 on July 1, portending a situation that “has the potential to be a disaster” for local social services, according to Armstrong County Commissioner Rich Fink (“State budget mess could cause local social service ‘disaster,’” Pittsburgh Tribune-Review, July 3).

The Philadelphia Inquirer reported on July 3 that health service providers around the state, including nursing homes, may suffer if state leaders fail to resolve the budget impasse swiftly. “The most affected,” the Inquirer wrote, “provide services to the medical assistance population, including hospitals, nursing homes, and doctors who help an estimated two million people who cannot afford to pay on their own.”

The paper quoted Philadelphia nursing home administrator Nancy Kleinberg, who said she had received a notice from the state’s Department of Public Welfare warning of a possible delay in medical assistance payments. She said she would first try to work out delayed payments to her suppliers, and would then rely on any reserves, but after that she would have no choice but to ask her staff to work without pay, on the promise of a reimbursement. “What makes this even harder is that we don’t know how long this delay will last,” she said (“Budget fight may affect health-service providers,” July 3).

Congresswoman Linda Sánchez

The Medicare Adult Day Care Services Act of 2009 (pdf), a bill that would expand options for home and community-based services, has been introduced into the U.S. House by Rep. Linda Sánchez (D-CA).

The bill would amend the Social Security Act to cover adult day care services under Medicare. Seniors and people with disabilities would then be able to choose whether to receive care at home or at an adult day care center.

Sánchez Spokeswoman Marsha Catron said the bill would give Medicare beneficiaries more services and care hours at an all-inclusive rate that’s lower than many providers currently offer. These services would include not only nursing but various therapies (physical, occupational, speech), social services and personal care, and meals, transportation and recreational activities.

“Adult day care is a family-friendly option for seniors who require rehabilitation and other assistance with daily life tasks, but don’t require 24-hour care,” Sánchez said in a press release. “The Medicare Adult Day Care Services Act is a cost-effective way to add more choice to Medicare because it would pay adult day care providers 98% of the home health rate and give our seniors the option to choose adult day care.”

Sánchez said the bill would also help family caregivers, the majority of whom are women from low-income families, by reducing the amount of wages, pension benefits, and Social Security benefits lost due to caregiving responsibilities. And it would do this without adding to the cost of Medicare.

For information about other recent HCBS-friendly legislation, see PHI’s stories on Project 2020 and the Home and Community Balancing Incentives Act.

The SCAN Foundation commissioned Lake Research Partners to conduct the National Omnibus Survey on Long-Term Care, which comprises the responses of more than 1,000 random adults who were surveyed in late June.

In addition to indicating that nearly 8 in 10 Americans want to see long-term care reform included in any national health reform plan, the report found the following:

• 92 percent of Americans say it’s important to improve coverage that allows people to receive home-based care instead of going into nursing homes
• 79 percent of Americans are concerned about their own or a family member’s ability to afford long-term care in the future
• 78 percent say they would benefit personally from health care reform that improves coverage for home and community-based long-term care services

The poll was released only a day after President Barack Obama formally endorsed including long-term care in his national health reform agenda by expressing support for the CLASS Act (see “Obama supports new long-term care benefit,” AP, July 8).

Sponsored by Senator Edward Kennedy, and included as part of the national health reform bill being created by the Senate Health, Education, Labor and Pensions (HELP) Committee, which Kennedy chairs, this legislation would create a voluntary national insurance program that would provide people with a modest daily payment to spend on nursing home services or in-home care.

HHS Secretary Kathleen Sebelius signaled Obama’s endorsement of the CLASS act in a letter she wrote to Kennedy, in which she said Obama “believes it is appropriate to include the CLASS Act as part of health reform because enactment of this important legislation would expand resources available to individuals and families to purchase long-term services and supports to enable them to remain in their own homes in the community” (“Obama Backs Helping Hand for Long-Term Care,” NPR, July 7).

Hilda Solis

A July 9 New York Times editorial calls for home care aides to receive minimum wage and overtime protections under the Fair Labor Standards Act. As the Times notes, in 2007, the Supreme Court upheld a 1975 labor regulation that defined home care aides as “companions,” but that regulation can be reversed anytime by Secretary of Labor Hilda Solis. This is the second editorial the Times has published on the issue; the first appeared in January 2009.

This second editorial was spurred in large part by “Dear Colleague” letters from both the U.S. House and Senate to Secretary of Labor Solis—part of an advocacy campaign organized by the Direct Care Alliance–urging the Secretary to re-consider the companionship exemption.

PHI applauds the Times for continuing to pressure the Department of Labor to ensure that home care workers are provided with minimum wage and overtime protections. PHI worked extensively with the Times editorial staff, providing the backround data for both editorials.

The July 9 editorial follows closely on a June 26 article in the Wall Street Journal, “Political Shift Revives Dispute over Overtime Pay,” that highlighted the companionship exemption issue. In his letter to the Wall Street Journal, PHI President Steven Dawson’s reiterated support for FSLA protections, while also noting the importance of “minimizing disruption” for employers and consumers. “In the end,” however, he notes, “the needs of some can never be justified by continued exploitation of others.”

Published in June 2009 by HCAN, Health Insurance Coverage Keeps Shrinking as Premiums, Family Costs Climb Ever Higher (pdf) draws on research from The Kaiser Family Foundation, The U.S. Bureau of Labor Statistics, The State Health Access Data Assistance Center, and other sources to document the trend of rising costs and shrinking health coverage in all 50 American states.

“Across the economic spectrum of families,” the report says, “the upward march of premiums and out-of-pocket costs has been unnerving. . . . High medical costs, decreased benefits, and rising costs have real effects on the quality of care available to families.”

Specific findings include the following:

• In the past nine years, U.S. wages grew 29 percent while the cost of health insurance rose 120 percent.
• Experts forecast that 50 million Americans will be uninsured next year due to high premiums.
• Lack of health insurance causes 22,000 deaths in the U.S. each year.
• Health insurers are increasingly limiting benefits to save money.
• 62 percent of bankruptcy filers in 2007 said medical bills contributed to their debts.

The report says in its executive summary that these trends are “battering family budgets, eroding U.S. competitiveness in the global economy and threatening the American standard of living, once the envy of the world.”

By way of recommendation, the report suggests that:

As President Barack Obama and his economic advisers have repeatedly said, health costs are increasing at an unsustainable rate, and the national economy will not thrive unless they are reined in. Health care reform that guarantees quality, affordable care for everyone in the United States—and offers the choice of a public health insurance plan—can do what our private health insurance system has failed to do: provide economic security for families and the nation.

Separately, HHS Secretary Kathleen Sebelius released a report on June 23 titled “Hidden Costs of Health Care: Why Americans Are Paying More but Getting Less.” The report states that

With each passing year, Americans are paying more for health care coverage. Employer-sponsored health insurance premiums have nearly doubled since 2000, a rate three times faster than wages. In 2008, the average premium for a family plan purchased through an employer was $12,680, nearly the annual earnings of a full-time minimum wage job. Americans pay more than ever for health insurance, but get less coverage.

It goes on to identify rising deductibles, higher copayments, and rising out-of-pocket costs as the “hidden costs” of American health care.

Carol Regan, who directs the PHI Health Care for Health Care Workers initiative, said, “As some of America’s lowest paid workers, direct-care workers often cannot afford the high cost of health care. A good litmus test for the effectiveness of national health care reform is whether it provides comprehensive, affordable coverage to these workers, who themselves provide a valuable health care service.”

“Project 2020: Building on the Promise of Home and Community-Based Services” was introduced on the Senate side as S. 1257 by Sens. Maria Cantwell (D-WA) and Debbie Stabenow (D-MI), both key members of the Senate Finance Committee. On the House side, Reps. Bruce L. Braley (D-IA) and John Sarbanes (D-MD), both members of the House Energy and Commerce Subcommittee on Health, introduced the companion bill H.R. 2852.

The bill’s stated purpose is “To amend the Social Security Act to build on the aging network to establish long-term services and supports through single-entry point systems, evidence-based disease prevention and health promotion programs, and enhanced nursing home diversion programs.”

Cantwell explained its intent in more detail in a June 12 press release:

This legislation is designed to fix a deficiency in current law that prevents people from accessing long-term care information or services until they have become poor enough to qualify for Medicaid.  By this time, it is often too late to provide cost-effective home care and people end up in nursing homes, where they frequently spend the rest of their lives. This bill would provide people with the resources they need to pay for the services and support they need to stay in their own homes and communities, while also avoiding Medicaid eligibility. This will save money and improve access to care.

These resources and services would include:

• Access for older adults to services that provide counseling and assistance regarding long-term care services and supports
• Wellness programs provided by Area Agencies on Aging for seniors
• Specific care plans intended to allow lower-income individuals to stay in the community and off Medicaid.

The legislation comes in the wake of an advocacy campaign by the Aging Services Network, and especially by the National Association of State Units on Aging (NASUA) and the National Association of Area Agencies on Aging (n4a). It has been the top legislative priority this year for both organizations, and was described by n4a in their 2009 statement of policy priorities (pdf) as “not a comprehensive long-term services and supports solution, but rather an obvious next step forward and a perfect complement to current health care reform efforts.”

Rep. Braley claimed the bill might save the federal government $1.2 billion over 10 years. He also stressed its importance to America’s senior population.

“Our seniors’ health and happiness is such an important issue,” he said in a prepared statement. “Nursing home care is often a necessary part of growing older, but if we can keep seniors and persons with disabilities healthier and in their homes longer, we can both improve their quality of life and save money. Project 2020 will make seniors’ golden years better.”

The bill was introduced on the same day that Sens. Cantwell and Herb Kohl (D-WI) introduced the “Home and Community Balancing Incentives Act,” which would offer enhanced federal Medicaid matching rates to states for home and community-based health care programs.

“PHI is pleased to see efforts in Congress to improve access to home and community-based services,” said PHI National Policy Director Steve Edelstein. “Providing these services, however, will require a commensurate workforce policy that can ensure a stable, well-trained direct-care workforce to meet the needs of growing numbers of older Americans and people with disabilities.”

The announcement was made on the tenth anniversary of the Olmstead case in which the Supreme Court ruled that the unjustified institutional isolation of people with disabilities is a form of unlawful discrimination under the Americans with Disabilities Act.

HHS Secretary Kathleen Sebelius

An announcement from Sebelius issued the same day indicated that she was taking various actions at HHS in support of the new initiative, including the creation of a new HHS Coordinating Council “to put in place solutions that address barriers to community living for individuals with disabilities and to give people more control over their lives and the supports they need.”

She also said she would direct additional funding toward the HHS Aging and Disability Resource Center Programs (ADRCs), which are a collaborative effort of the Administration on Aging (AoA) and the Centers for Medicare & Medicaid Services (CMS), and intended to provide a “one-stop shop for consumers for long-term care information, assistance, and access to services.”

HUD Secretary Shaun Donovan

HUD announced, in turn, that it was making available $30 million in voucher assistance to provide housing support for 4,000 non-elderly disabled families, including 1,000 vouchers that are targeted specifically at people who are transitioning out of nursing homes and other institutions. Notably, these 1,000 vouchers directly satisfy an ongoing demand from ADAPT.

Some individuals and organizations expressed a tempered optimism regarding the new initiative.

Chris Hildebrant, Director of Advocacy for the Center for Disability Rights, opined in a June 23 blog post that while the initiative contains many positive points, it still fails to eliminate the institutional bias in America’s long-term services and supports.

Denika Boardman, systems change coordinator for Central Coast Center for Independent Living in California, called the initiative a “positive development” in a July 2 column for The Californian, but said that “many people with disabilities have little to celebrate on this anniversary” of the Olmstead decision, since California’s catastrophic budget crisis is resulting in cuts to “nearly every community support service people with disabilities need to live independently.”

But President Obama expressed resolute optimism even as he acknowledged the long delay in achieving full independence for individuals with disabilities.

“The Olmstead ruling was a critical step forward for our nation, articulating one of the most fundamental rights of Americans with disabilities: Having the choice to live independently,” he said. “I am proud to launch this initiative to reaffirm my Administration’s commitment to vigorous enforcement of civil rights for Americans with disabilities and to ensuring the fullest inclusion of all people in the life of our nation.”

U.S. District Judge Claudia Wilken issued an injunction on June 25 to halt the wage cuts, ordering the state to continue paying workers for its In-Home Supportive Services (IHSS) program up to $12.10 in wages and benefits. Without this injunction, tens of thousands of IHSS workers would have seen their wages shrink from $11.50 to $9.50 per hour beginning July 1, the first day of the state’s new fiscal year.

The injunction states that before California can make such cuts, it must first offer an analysis of how they would impact the efficiency, economy, quality, and accessibility of care (“State vows to pursue home care workers’ wage cuts,” Mercury News, June 26).

In a blog post cheering Wilken’s action, SEIU, which represents 250,000 of California’s 400,000 home care workers, said the wage cuts “would have forced thousands of homecare providers to leave their employment to seek living-wage jobs, forcing frail seniors and people with disabilities to enter nursing homes or other residential institutions” (“Judge Orders State to Halt Wage Cut for California Home Workers,” SEIU, June 25).

Those who have been following PHI’s reporting on this issue will note that the proposed wage cuts have had an on-again, off-again existence. In mid-May, the Obama administration initially indicated that the cuts would violate the terms of the American Recovery and Reinvestment Act (ARRA) but then reversed that judgment less than two weeks later, after California voters rejected a series of fiscal ballot initiatives proposed by Gov. Arnold Schwarzenegger to remedy the state’s massive budget shortfall.

When Schwarzenegger responded by reviving the wage cuts as part of a broader package of cuts to state programs, SEIU launched a series of high-profile protests and filed a class action lawsuit in U.S. District Court of the Northern District of California seeking a preliminary injunction to stop the State of California and Fresno County from cutting home care worker wages and reducing care hours for seniors and people with disabilities. The suit alleges that the cuts would violate the federal Medicaid Law, Americans with Disabilities Act, and Rehabilitation Act.

Contact: Alex Olins
PHI Northern New England Director
Phone: (802) 655-4615
Email: aolins@PHInational.org

Rewarding Skill and Improving Care
New initiative provides career advancement opportunities for direct-care workers in Vermont

Burlington, VT — Few issues are more important to people today than health care. Both from a personal and societal perspective, Americans are deeply concerned about what the future holds for them when it comes to health care. In many states, the growing needs of an aging “baby boomer” generation are creating an enormous shortage in qualified direct-care workers, who provide most of the “hands on” home and community-based care that elders and people living with disabilities depend upon.

Challenged by this critical need, the Vermont Department of Labor, with funding from the DOL’s Workforce Education and Training Fund, is supporting a unique education and career ladder training program for 65 Personal Care Assistants (PCAs) at four sites in northwestern Vermont:

• VNA of Chittenden and Grand Isle Counties
• Franklin County Home Health Agency
• Armistead Caregiver Services
• Home Instead Senior Care

PHI — a nationally recognized training and organizational development consulting firm focused exclusively in the eldercare/disability services industry, with a regional office in Vermont for many years— will be serving as project manager of the entire initiative. PHI will be collaborating with the Vermont Department of Labor (DOL), the Northwest Technical Center, the Community College of Vermont, Vermont Adult Learning, and all four community partner sites throughout the project.

“These educational opportunities will be the next steps in what has proven to be a valuable and mutually important collaboration,” said Churchill Hindes, VNA President and CEO. “This initiative will benefit the agencies involved, the trainees who participate in the instruction, and ultimately — and most importantly — the people who will benefit from their skills and caring.”

An Innovative Solution with Growth Opportunities

The initiative will address the state’s shortage of direct-care workers with the development of a career ladder training program to improve workforce retention and ultimately, it is hoped, increase the number of PCAs available to care for Vermont’s aging population. The program will assist incumbent workers to advance in their health care careers, and allow participating workers and organizations to:

• Earn while they learn. PCAs will be paid for at least 50 percent of their time while in training—a critical component of success in incumbent worker training programs for low-wage workers.
• Work toward meaningful promotions and raises: At some locations, training will enable a PCA to be promoted to PCA II. At other sites, training will enable a PCA to be certified as a Licensed Nursing Assistant (LNA), with the requisite increase in wages.
• Participate in a flexible and robust learning opportunity. Each provider will provide a customized training program for its workers.
• Encourage a more diverse group to enter health care professions. Non-native English speaking participants will be able to take contextualized ESOL classes at their worksite, in conjunction with their clinical skills classes.
• Improve workforce retention.

The CareWell curriculum, a 40-hour course developed by the Visiting Nurse Association (with support from the Community of Vermont Elders through their Better Jobs Better Care initiative), will be a cornerstone of the PCA training. PHI, in addition to its role as project manager, will also be providing its “Coaching Approach to Communication” training at all sites.

“One of the fastest-growing occupational areas in Vermont over the next 20 years will be in direct-care services,” said Greg Voorheis, Senior Grant Administrator for the Vermont Department of Labor. “The state’s Workforce Education and Training Fund grant to PHI creates the opportunity for multiple long-term care employers to hire well-trained direct-care workers who will be participating in the development of a career ladder.

“PHI’s leadership in this work will benefit not only long-term care employers, but many direct-care workers already in the field — or individuals who aspire to work in the field. And, most importantly, their work will improve the quality of health care provided to individuals. We look forward to sharing what we learn with others,” Voorheis concluded.

The program, which was officially launched in early June, will conclude in June of 2010.

For more information about this project, call Alexandra Olins, PHI Regional Director, Northern New England, at 802-655-4615.

Contact: Steve Edelstein
National Policy Director
Phone: 718-402-7413
Email: sedelstein@phinational.org

PHI Launches PolicyWorks
National Strategy Center for the Direct-Care Workforce Promotes Information, Innovation and Action

New York— By 2016, the United States will need 4 million direct-care workers to care for America’s elders and people with disabilities—more than the number of teachers needed to educate our youth in grades K-12.

Yet America is unprepared to meet this growing demand. Public policies have created a delivery system for paid care that relies on a low-skilled, low-wage workforce to provide essential supports. Committed, caring workers bypass these occupations or leave them when better opportunities are available. The result is a system plagued by high turnover and vacancies, poorly equipped for supporting the quality of life of millions of Americans of all ages with chronic illnesses and disabilities.

PHI PolicyWorks, an online strategy center, provides users with innovative policy tools to address this historic challenge. The goal of PolicyWorks is to promote national and state policy solutions that strengthen the direct-care workforce and prepare our nation to care for growing numbers of elders and people with disabilities.

PHI National Policy Director Steve Edelstein notes that “the time is right for a coordinated effort to transform the public policies that shape this vital workforce. We need to develop healthcare and workforce policies that can bear the weight of our nation’s growing need for eldercare/disability services.”

Improving the quality of direct-care jobs is key to three issues of critical importance for all Americans:

• Economic development: Direct-care workers constitute arguably the largest workforce in the country, and creating quality jobs for these workers will sustain families and communities, and help restore our economy.
• Access to care: Addressing the high rates of direct-care worker vacancies and turnover is essential to ensuring that American families have access to sufficient numbers of well-trained and supported paid caregivers to provide needed services.
• Quality of care: Direct-care workers provide 70 to 80 percent of the paid hands-on daily care and support received by elders and people with disabilities. Policymakers cannot ensure the quality of these services without addressing the quality of these jobs.

PHI President Steven L. Dawson noted, “As the nation gears up to reform its health care system, PolicyWorks will be an important resource. PHI’s PolicyWorks staff will use their expertise to analyze reform proposals and make recommendations to ensure that America has a health care system that adequately provides for the needs of increasing numbers of people with chronic care needs.”

PHI PolicyWorks gives users access to up-to-date statistics, timely research and analysis, strategic legislative and regulatory recommendations, and advocacy tools and resources. Staffed by PHI’s national and state policy experts, the site features:

• Strategic areas: Frameworks for understanding the leading policy issues affecting direct-care workforce policy and the quality of eldercare/disability services.
• Workforce Facts: An introduction to the demographics, size, and economic impact of the direct-care workforce.
• PHI Policy Recommendations: Strategic recommendations on national health care reform efforts and other critical issues affecting direct-care workers.
• Guide to Accessing Federal Recovery Act Funds: Tools for tapping into unprecedented new public employment and training monies for programs to recruit, train and support direct-care workers.
• Health Reform Resource Center: Information and resources regarding how to achieve quality, affordable health care coverage for all Americans, including elders and people with disabilities and those who care for them.
• PHI Chart Gallery: Easily downloadable charts that visually summarize key data on the direct-care workforce.

PolicyWorks complements PHI’s National Clearinghouse on the Direct Care Workforce, an on-line library which houses nearly 1000 research papers and other documents supporting quality care through quality jobs.

PHI works to improve the lives of people who need home and residential care—and the lives of the workers who provide that care.