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Job Quality in Direct Care Relies on Long-Term Care Financing

By Robert Espinoza | February 8, 2021

The Biden-Harris administration is exciting news for direct care workers and the long-term care field.

In July 2020, then-presidential candidate Joe Biden released a 10-year, $775 billion plan to build a “robust 21st century caregiving and education workforce.” This much-needed plan included measures to improve job quality in direct care, expand access to home and community-based services (where millions of home care workers are employed), and establish a long-term services and supports innovation fund (that will ideally also resource innovations related to the direct care workforce).

Since taking office, President Biden has already issued various executive orders that will impact the overall well-being of this workforce on issues related to immigration, racial justice, and more. (Also, in July 2019, then-Senator Kamala Harris introduced a federal bill to establish a bill of rights and broad workforce protections for home care workers, housekeeps, and childcare workers.)

Realizing the promise of this caregiving plan should be a priority for the Biden-Harris administration. As the COVID-19 pandemic has reinforced, direct care workers are essential to the health and survival of millions of older adults and people with disabilities. Yet the poor quality of direct care jobs—as evidenced by low compensation, inadequate training, limited career paths, and much more—harms workers’ financial security, hinders quality care, and drives workers out of this sector, a costly and unsustainable trend.

How should President Biden and Vice President Harris transform the direct care workforce?

Our new report—Caring for the Future: The Power and Potential of America’s Direct Care Workforce—provides a blueprint for this transformation. This report offers a comprehensive, current-day analysis of the direct care workforce and its critical role in the long-term care system. It also provides an extensive list of recommendations across eight key areas, all of which present federal policy opportunities, as well as options for state and local officials. This article, the first in an eight-part series, outlines several critical options for improving jobs for direct care workers by addressing the financing challenges facing long-term care.

Now is the time for federal leaders to strengthen direct care jobs—and here’s one place to start.

LONG-TERM CARE FINANCING

To ensure that long-term care financing programs address the profound needs of consumers and workers

Protect and strengthen Medicaid to cover more individuals and improve direct care jobs. Medicaid plays a significant role in the long-term care sector, providing health coverage to many direct care workers, supporting low-income people with long-term services and supports (LTSS), and funding providers to deliver care and support their workforces. Despite its large-scale benefits, Medicaid remains politically contested and underfunded, leading to prohibitive eligibility requirements, long waiting lists, and service caps for consumers—and financially straining providers, which prevents them from creating high-quality direct care jobs. Federal and state policymakers should protect and strengthen Medicaid while integrating direct care workforce measures into its funding and delivery systems.

Increase reimbursement rates to bolster job quality in direct care. Inadequate reimbursement rates under Medicaid (and other public payers) prevent many long-term care employers, including self-directing consumers, from offering competitive wages and investing in direct care job quality. These public reimbursement rates should be increased—with requirements that employers spend a meaningful percentage of their reimbursements on improving wages, benefits, training, and other pillars of job quality. Similarly, managed care plans should be required to provide a minimum base rate to employers that covers these vital workforce investments. To ensure adequate and accurate reimbursement rates, policymakers should follow a rigorous and transparent rate-setting methodology, drawing from cost reports and other input from stakeholders.

Create a stronger public financing approach for long-term care and the direct care workforce. New social insurance programs should be created to make long-term care affordable to all older adults and people with disabilities, regardless of their income and assets. These programs should also be designed to proactively strengthen the direct care workforce. Long-term care leaders should convene work groups and commission new studies to inform the design and development of new long-term care programs, with explicit attention to direct care workforce concerns.

 * The recommendations above are taken from Caring for the Future: The Power and Potential of America’s Direct Care Workforce.

Read the executive summary of Caring for the Future >>

Download The 5 Pillars of Direct Care Job Quality >>

Robert Espinoza
About The Author

Robert Espinoza

Vice President of Policy
Robert Espinoza oversees PHI's national policy, research, and communications division. He has been a national policy expert, communications strategist, and writer for 20 years.
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Caring for the Future

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