Home > Press > Press Releases > Report: Low Wages for Caregivers Worsen Barriers in Maryland Program Helping Seniors, People with Disabilities

Report: Low Wages for Caregivers Worsen Barriers in Maryland Program Helping Seniors, People with Disabilities

Shortcomings disproportionately harm Black women, other people of color

Maryland’s policy choices around Medicaid-funded home-based assistance to older adults and people with disabilities perpetuate racial injustice and make the program less effective, a new analysis by the Maryland Center on Economic Policy (MDCEP) shows. Insufficient funding and low pay for caregivers limit access to care, expose workers to financial hardship, and stand in the way of strong, inclusive care infrastructure.

MDCEP conducted this analysis as a case study to demonstrate how the state could implement racial and ethnic equity analysis in its budget processes. MDCEP previously published a report recommending greater use of data disaggregated by race, ethnicity, gender and other characteristics to conduct equity analyses on state spending.

“The choices state policymakers make through the state budget have the ability to advance racial equity, reinforce an already inequitable system, or even create new barriers to opportunity,” MDCEP Research Analyst Christopher Meyer, the report’s author, said. “This case study shows the value of performing this kind of analysis. Home care workers are disproportionately women of color, and the low pay they receive for their work not only holds back them and their families, but makes the program less effective for people who rely on home care services as well.”

Highlights from the case study:

  • There is a shortage of home care workers, people who help older adults and people with disabilities with daily tasks such as bathing and dressing. People with significant needs and who meet the income requirements receive these services through a Medicaid-funded program in Maryland. The state sets the rates paid for these services.
  • The shortage in the home care workforce and insufficient overall funding for the program means that some people may be on a waiting list for services while those who are approved to receive services may still have trouble finding a service provider or experience frequent turnover and gaps in service. This can also lead to additional stress for family members helping with caregiving.
  • Nearly half of home care workers in Maryland are Black women and more than 60% are women of color.
  • Poor job quality is a major factor in recruiting and retaining home care workers and is linked to a history of discriminatory labor policies in the U.S. and Maryland. There are three main factors affecting home care workers today:
    • Lack of compensation standards: Policymakers have not adopted any specific standards for pay or benefits in Medicaid-funded Home and Community-Based Services.
    • Potentially inadequate reimbursement rates: Medicaid payment rates must cover home care worker wages and administrative costs, and the agency model builds in an expectation of profit.
    • Independent contractor misclassification: A significant number of residential service agencies classify at least a subset of home care workers as independent contractors rather than employees. This means they are exempt from protections like minimum wage and overtime and that they are responsible for both the employer and employee share of payroll taxes, among other consequences.
  • The Fair Wage Act of 2023 will help boost wages for home care workers, but the benefits will be temporary as the legislation did not include future minimum wage increases beyond Jan. 1, 2024.

The case study was made possible by an award provided by The Leadership Conference Education Fund. The author and publisher are solely responsible for the accuracy of statements and interpretations contained in this publication. Find the full report at https://www.mdeconomy.org/budgeting-for-opportunity-case-study/

###

 

Media Contact

Kali Schumitz, Vice President for External Relations
410-412-9105, ext. 701
kschumitz@mdeconomy.org

 

About Maryland Center on Economic Policy

The Maryland Center on Economic Policy advances innovative policy ideas to foster broad prosperity and help our state be the standard-bearer for responsible public policy. We engage in research, analysis, strategic communications, public education, and grassroots alliances promoting robust debate and greater public awareness of the policy choices Maryland residents face together. mdeconomy.org