The long-predicted shortage of personal care aides is here. And it is creating enormous challenges for frail older adults and people with disabilities living at home as well as for operators and residents of nursing homes and assisted living facilities.
This shortage inevitably will drive up costs for services that already are unaffordable for many consumers. They will increase financial pressures on Medicare and Medicaid and force older adults and others with disabilities to rethink how they receive care. At the same time, labor shortages will drive innovation and new technologies that could remake supports and services.
The US has known this was coming for years. As the aging population grew, the number of personal care aides to provide care at home or in nursing or assisted living facilities was not keeping up. But now the shortage is here.
A tight labor market
The long-term problem is all about demographics: The Baby Boomers are aging and, because they had relatively few children, there won’t be enough people of caregiving age—either relatives or paid aides– to help them. But even before we hit the demographic wall, the US is facing more immediate short-term problems.
The biggest may be the strong economy and the very tight labor market. The unemployment rate was 3.7 percent in October, the lowest in a half century. And with lots of other available jobs, it is increasing hard to recruit low-paid aides.
According to the advocacy and research organization PHI, home care workers earn a median wage of $11.03 an hour while nursing assistants in nursing homes earn $12.84 an hour. And their injury rates are among the highest of any occupation in the US.
By contrast, veterinary technicians make more than $16 an hour. A society that pays more to workers who look after pets than those who care for parents should not be surprised when people gravitate to easier and better-paying jobs.
The other problem is immigration. Even as the growth in available native-born direct workers slows, the Trump Administration is aggressively limiting immigration into the US and even looking to deport undocumented people already living here. Already, more than one-quarter of aides are immigrants.
How tight is the current market for direct care workers? The newsletter Home Health Care News reports that home care companies increasingly are requiring non-compete agreements that limit the ability of aides to move to other agencies or to work directly for their clients, who would then avoid paying the agency fees.
According to the newsletter, a lawyer who represents agencies said, “They don’t have enough of a labor force to satisfy their client demands.”
Finding solutions is not easy.
Government is looking to regulatory answers, including new rules to require higher staffing levels and more disclosure of facilities that are chronically short-staffed.
Last summer Jordan Rau of Kaiser Health News reported that many facilities have fewer staff than they report to the government. In response, the federal Centers for Medicare and Medicaid Services announced last week that it would urge states to boost inspections in an effort to end the practice. At the same time, some states have moved to mandate specific minimum staffing rules for nursing homes. Last spring, the New Jersey legislature tried.
But requiring minimum staffing won’t solve the problem. Many nursing homes will respond to these mandates by closing beds or otherwise changing their business models. This is a particular problem in long-stay nursing facilities where wages are largely driven by Medicaid. It makes little sense for the government to demand facilities hire more staff if its payment rates won’t support a decent wage for the workers they have.
But nursing homes are only a small piece of the problem. Fewer than 10 percent of those who require long-term supports and services live in those facilities. About another 8 percent live in assisted living facilities, which are unregulated by the federal government. But more than 80 percent live at home. How will they find aides?
You may say it is fine to shut down all the nursing homes but the reality is this: Delivering care to tens of millions of seniors living in their own homes is vastly less efficient than caring for them in facilities. Growing demand for home care will make the aide shortage even worse.
Adult day programs and volunteer programs such as senior villages can help. But they’ll only dent the growing demand for aides.
Supply and demand
How about technology? It undoubtedly will help. Facilities increasingly will install devices to monitor the well-being of residents. And some gizmos even are finding their ways into private homes. But caregiving remains a high-touch personal job and we are a long way from the time when human caregivers are replaced by robots.
The bottom line is that the law of supply and demand ultimately will win out, as it always does. The only way to increase the supply of aides is to pay them more, give them more benefits, make their work more rewarding, and give them opportunities for advancement.
We’ll just have to figure out where the money will come from.
[…] will have to confront one challenge: The effects of a $15-an-hour minimum wage on Medicaid. Direct care workers desperately need a pay raise and better working conditions, especially in the wake of the pandemic. But a raise to $15 an hour for home care workers, who […]