In recent years and months, rising minimum wage has been top of mind for home-based care providers, adding another level of difficulty to attracting and retaining workers. But fair scheduling legislation that’s gaining steam in cities and states across the country could soon take center stage — and potentially make matters worse.
Fair scheduling legislation varies across the country, but generally, the rules mandate employees must receive set work schedules a certain number of days in advance and a certain number of rest hours in between shifts.
If employers don’t meet requirements, they must pay workers a premium rate — a stipulation that could devastate home-based care providers, who already have tight profit margins and often need to provide last-minute care to clients. Additionally, a large portion of home care clients are frail older adults with complex medical conditions, meaning they’re often in and out of the hospital and need to cancel scheduled visits.
“In certain industries where volatility in the schedule is second nature — that is what the business is and everybody understands it — those kinds of laws just don’t work,” Angelo Spinola, shareholder and attorney at international labor and employment law firm Littler Mendelson, told Home Health Care News.
In most states and cities with fair scheduling laws, the rules only apply to certain industries, such as retail, hospitality and food services. Some examples include the state of Oregon, along with the cities of San Francisco and Seattle.
Meanwhile, Vermont is the only state where home-based care providers are not exempt from fair scheduling laws, Spinola said.
But that could change in the future. For example, a fair scheduling ordinance being considered in Chicago casts a wide net and would apply to most industries, including home-based care.
If passed, it would require employers to give employees written notice of their schedules two weeks in advance and require workers at least 11 hours of time off between shifts. Schedule changes or inability to meet these requirements would require employers to pay workers premiums.
A number of home-based care advocacy groups are pushing back on the legislation, including the Illinois HomeCare & Hospice Council (IHHC).
“I think it’s important that the policymakers recognize the differences between industries,” Liz Vogt, director of regulatory and government affairs at IHHC, told HHCN. “If someone falls and they have to go into the hospital or they have pneumonia or someone passes away, [a home health agency] really needs the ability to reassign the visit or utilize the employee in a way that the patient needs.”
Vogt and her colleagues — along with organizations such as LeadingAge Illinois, the Illinois chapter of the Home Care Association of America (HCAOA) and the Illinois Association of Community Program Homecare Providers (IACCPHP) — have been advocating for industry-specific updates to the ordinance, but thus far, no changes have been made.
“While this is really specific to the city of Chicago right now, we know that oftentimes policy originates in one place and then quickly spreads,” Vogt said. “It’s in our best interest to be proactive and get it right.”
The ordinance — and the legislative fair scheduling trend — is also a concern for Addus HomeCare Corporation (Nasdaq: ADUS), Chief Development Officer Darby Anderson told Home Health Care News.
Frisco, Texas-based Addus provides personal care, hospice and home health care services to about 39,000 clients in 24 states, with much of its revenue coming from Medicaid.
“It’s come more on our radar since some of the more recent ordinances have been more inclusive of all industries,” Anderson said.
Such was the case with state legislation introduced on in New York in 2017 and in Illinois last year — two states in which Addus operates. Ultimately, neither fair scheduling ordinance became law, but if they had, Addus would have struggled to keep up, Anderson said.
In 2018, more than 58% of Addus’s net service revenues came from state and local governmental agencies, according to a recent SEC filing.
“It all comes down to reimbursement,” he said. “If I called somebody and said, ‘Hey, Mary called off because her child is sick. Can you cover her shift?’ I’d have to pay the premium, and on Medicaid rates, I just can’t afford to do that.”
Anderson has raised similar concerns as states continue to increase their minimum wages, arguing that Medicare and Medicaid reimbursements must also increase in order for home health agencies to stay in business.
Meanwhile, Spinola says speaking out against detrimental legislation — including fair scheduling ordinances — is the best thing owners and operators of home-based care companies can do.
“Sometimes the legislature is influenced by employee advocacy groups, and the employee advocacy groups are very active and loud in expressing what is happening and what they want,” Spinola said. “The employer groups are typically not present or there’s not enough representation for the employer groups … It’s super important that industry groups like home care really band together and identify these kinds of issues right on the front end before they become law.”