Requires home health agencies, long term home health care programs and managed care plans to pay home care agencies the total average hourly worker cost for home care aides

Summary of provisions

Section 1 of the bill amends subdivision 7 of section 3614-C of the Public Health Law to require those who elect to provide home care aide services through contracts with licensed home care services agencies (LHCSA) or other third parties to reimburse the LHCSA the total average hourly worker cost, including the current total compensation mandated and additional fringe and other statutory and benefit requirements, and an administrative and general cost factor that is no less than allowed pursuant to subdivision 6 of section 3612 of the public health law.

Section 2 would make the bill effective immediately.

Justification

Chapter 59 of the Laws of 2011 established a minimum wage for home care workers who perform Medicaid reimbursed work for certified home health agencies (CHHAs), Long Term Home Health Care Programs (LTHHCPs) and managed care organizations (MCOs) within New York City and within the counties of Nassau, Suffolk and Westchester. MCOs include mainstream plans, as well as all forms of managed long term care plans (MLTCs). The goal of the wage parity law is to retain a qualified long term care work force and improve the quality of care for patients in the State's Medicaid Long Term Care Program. This legislation ensures that home care agencies such as licensed home care services agencies (LHCSAs) are provided sufficient payments by managed care entities, CHHAs and LTHHCPs to meet the obligations and intent of the law.

In counties subject to the wage parity law, agencies seeking to pay rising wage parity rates must be assured reimbursement that will permit them to cover the increased costs. The costs to employ home care workers includes expenses that go far beyond the hourly wage that is paid to an aide and it is critical that reimbursement rates reflect the additional costs that agencies are subject to. Agencies incur ongoing expenses related to worker recruitment and hiring, payroll costs, worker retention, coordination of quality patient care, and costs to comply with mounting unfunded mandates, regulations and policies at both the State and Federal level. Worker wages make up a high proportion of the cost of providing long term care, and the rate of pay an agency is able to provide its workers is largely dependent on the agency's reimbursement rate. Agencies are working under increasingly limited resources and, in order to accommodate increased

wages for workers, there must be commensurate increases in reimbursement.

Currently, agencies seeking to pay wage parity rates are not guaranteed the proper payment amounts by managed long term care entities, certified home health agencies or long term home health care programs. This legislation works to ensure worker's wages under the wage parity law are supported in payments to home health care agencies by these entities. Specifically, the legislation requires that reimbursement to licensed home care services agencies reflect the total average hourly worker cost, including the current total compensation mandated and additional fringe and other statutory and benefit requirements, and an adequate administrative and general cost factor. This legislation is critical to ensure the ability of agencies to meet the increased wage and benefit mandates set forth by the wage parity law, the stability of the home and community-based care industry in wage parity regions, and consumer continuity and access to high quality home care services.

Legislative history

2014: S.6829

Fiscal implications

None.

Effective date

This act shall take effect immediately.