Tenn. Home Health Industry Explores Impact of New Wage Rules

Home health providers, advocacy groups, and trade associations in Tennessee are studying the expected impact of the new federal rule making home care workers eligible for minimum wage and overtime pay protection, reports The Tennessean. 

Direct care workers had previously been exempt from the Fair Labor Standards Act, which mandates what workers are eligible for minimum wage and overtime pay.

The Department of Labor’s new rule will impact Tennessee as it had not previously required minimum wage or overtime protections for home care workers. The changed standards will go into effect January 15.

Reactions to the new wage rules have been mixed, reports The Tennessean, and for many, the impact is still unknown.

Larger health care companies with home health businesses aren’t likely to feel much of a hit, according to the article, as oftentimes their home care lines only represent a small portion of their overall revenue. For smaller companies, it could have a much larger significance. 

The overtime pay requirements will make “companionship care” unaffordable for some, according to the National Federation of Independent Businesses, a D.C.-based advocacy group. 

“By ending the companionship exemption, DOL has effectively mandated home care providers work in shorter shifts with reduced hours,” Susan Eckerly, NFIB’s senior vice president of federal public policy, said in a statement. “At the same time, those who rely on these services can expect less personal care coupled with significantly rising prices.” 

Under the new rule, home care agencies may try to prevent their workers from overtime hours in a bid to cut costs and not have to pay overtime. This could affect clients who need more than 40 hours of care each week, says the article.

“It’ll make things more challenging,” Ron Benkert, owner of Nashville and Franklin franchises of a national home health care franchise company, BrightStar, told The Tennesseean. “Exactly how we deal with those challenges remains to be seen. Obviously, we’re not going to compromise care over this.”

Benkert’s staff already receive at least minimum wages, he said, but a significant chunk of his staff provides round-the-clock care that will now be eligible for overtime pay. He says in the article he’s still studying how the rule will affect his company. 

However, trade groups for home care workers, including the Paraprofessional Healthcare Institute, have hailed the new rule as a victory. 

“This decision is like a breath of fresh air,” said Lauralyn Clark, a home care worker from Virginia, on a conference call that included both advocates and workers. “I’m so excited about what is about to happen to me and many other health care workers around the country. Overtime protection is going to make paying for my daughter’s college a little easier, and a vacation is now a dream that could come true.”

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Written by Alyssa Gerace 

Alyssa Gerace

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