November 1, 2023  – Amidst the lingering aftermath of a global health crisis and pervasive workforce shortages, states are proactively elevating Medicaid reimbursement rates to fortify home healthcare services. A recent analysis by the Kaiser Family Foundation (KFF) reflects survey data from state officials responsible for managing Medicaid HCBS programs from May to August 2023

The comprehensive survey uncovered that workforce shortages were universally experienced, stretching from the nation’s capital to all states surveyed. The sectors hardest hit include direct support professionals, personal care attendants, and nursing staff, with deficits also noted among home health aides, case managers, and various therapists.

The root of these shortages can be traced back to self-reported low reimbursement rates, compounded by increasingly demanding provider requirements. Echoing sentiments from 2021, HCBS providers in focus group discussions characterized their roles as highly taxing both physically and mentally.

The repercussions of the workforce shortage have led to the closing of numerous HCBS facilities, including adult day programs, group homes, and assisted living facilities, with 37 states reporting multiple provider type closures. This reduction in services provided have been attributed to the dual pressures of enduring provider shortages and pandemic-related hurdles.

In response to these challenges, an overwhelming majority of states have initiated payment rate enhancements as a corrective measure. Yet, these increases have been temporary for some worker categories, and consistent cost of living adjustments remain elusive across various staff types.

In tandem with financial incentives, states are also enriching worker education and training endeavors. Additionally, various states have taken steps to increase the state minimum wage and extend paid sick leave to workers. These measures are complemented by initiatives to forge connections between job seekers and employers, alongside proactive outreach and social media campaigns.

The compensation landscape for HCBS providers is as varied as the states themselves, with payment rates for services rendered often falling short of the living wage threshold. On average, personal care providers receive $19 per hour, home health aides $28 per hour, and registered nurses delivering home-based care command $43 per hour.

These workforce shortages within Medicaid’s HCBS are symptomatic of broader systemic issues pervading the long-term services and supports (LTSS) sector. Nursing facilities, in particular, are navigating formidable staffing challenges initiated by the pandemic’s onset. In fact, another recent KFF brief noted that less than 20% of nursing facilities could meet recently recommended stagging levels from a proposed rule that the Biden Administration released. 

As states grapple with these complexities, the landscape of Medicaid-funded home healthcare continues to evolve, seeking sustainable solutions to nurture a robust, resilient, and responsive care network for the nation’s aging population and those with special needs.