Now Is the Time to Improve Compensation in Direct Care

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

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 many workers out of this sector, a costly and unsustainable trend.

How should President Biden 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 second in an eight-part series, outlines several critical options for improving compensation and economic security for direct care workers.

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

INCREASE COMPENSATION

To improve economic security for direct care workers and ensure that direct care jobs are competitive with other occupations

• Pay direct care workers a living wage. Providing a living wage to direct care workers would support their economic security, decrease turnover, improve care, and boost the economy (through increased consumer spending and a reduced reliance on public benefits). Policymakers should establish wage floors for these workers that are aligned with their skills and experience and tied to the cost of living in their geographic areas. To prevent cuts in LTSS, these wage measures must be accompanied by increased public reimbursement rates.
• Improve access to full-time schedules for direct care workers. One in four part-time direct care workers reports being unable to find full-time work with their employer or on the wider labor market, while others work part time because they are raising children, helping other family members, or in school. Providers should be adequately financed to provide full-time hours to every worker who wants them. Policymakers should also study the scheduling barriers that long-term care employers and direct care workers face, and invest in evidence-based technology solutions that help align employers’ scheduling requirements with workers’ availability, offer workers more control over their schedules, and streamline the connection between self-directing consumers and potential workers.
• Strengthen the social safety net and improve access to workplace benefits for direct care workers. Affordable health insurance, free or low-cost childcare, paid sick leave, paid family and medical leave, and retirement savings options are critical elements of economic security, among others. Policymakers should strengthen the social safety net by extending these benefits to all low-wage workers, including direct care workers. In the meantime, long-term care reimbursement rates should be structured to account for the cost of providing these benefits to direct care workers through their jobs.
• Evaluate the unintended impact of wage increase measures on direct care workers, their employers, and consumers. While essential to direct care workers’ economic well-being, policies that increase wages can have unintended consequences. For example, unless paired with an increase in Medicaid funding and reimbursement rates, new wage requirements can force long-term care employers, including self-directing consumers, to cut service hours or reduce staffing levels. Additionally, because of benefit cliffs and plateaus, low-wage workers might see their total compensation remain the same or even drop when their wages increase because of a corresponding decrease in public benefits. Policymakers should evaluate the impact of policies that increase wages on direct care workers’ total compensation, the financial stability of employers, and consumers’ service hours—and devise strategies to address any unintended negative effects.

 * 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 >>