Home Care Industry Study Reveals Negative Economic Impact of Labor Rule

A proposed rule form the U.S. Department of Labor to provide minimum wage and overtime protections for in home caregivers will create disruptions in the home care market according to a new study from the industry.

“Overall, the report suggests that the costs of these proposed changes would be substantial, far more than the PRIA reveals, resulting in less availability of companion care and lower quality care,” said the National president of the Private Care Association (PCA) in a statement.

The association believes the new rule will raise the costs of care for consumers. As a result, in home care givers will need to take on more clients for fewer hours, which would negatively impact their incomes. These economic drawbacks will in turn affect the social aspect of home care by straining the relationships that form.

“To get around overtime, individuals or their children or grandchildren may choose to create a revolving door of caregivers, which will interrupt the quality and consistency of care they’re used to,” said Joseph Bensmihen, president of the PCA. “Caregivers could be forced to move multiple times weekly to accommodate families who are unwilling or unable to pay overtime. The difficulty of synchronizing multiple client schedules could actually reduce caregiver work hours, and this may ultimately be detrimental to the relationships they have with their regular clients.”

According to the study, the sector employs approximately 1.7 million people in over 73,000 separate businesses with total wages of $413 billion.

The comment period for the proposed rule closed on March 21, 2012.

View the study here.

Written by John Yedinak

John Yedinak



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