East Texas direct care agencies: 'Costs will not change' due to new law
SMITH COUNTY, TX (KLTV) -
The US Department of Labor has now approved new rules for at-home healthcare agencies, requiring the companies to pay their employees minimum wage and overtime—measures that they have been exempt from since the 1974 Fair Labor Standards Act.
Some groups argued that the change could increase costs for direct care businesses and make consumers’ healthcare more expensive.
The move comes in response to the continued boom in the industry, which employs workers the labor department said “remain among the lowest paid in the service industry.”
The White House said that is why they are extending the requirements, as part of a move to help low-income workers make ends meet. The government said approximately 40% of those direct care workers receive federal benefits such as food stamps and Medicaid. But experts said most East Texas agencies already meet the standards.
“I honestly think there's some political motivation behind it,” said Wendy Bratteli of the Texas Association of Health Underwriters. “Ii say that because the agencies here in town are paying minimum wage or better already, so I don't really see this impacting our area.”
While opponents said the move would increase healthcare costs for consumers, local agencies said it does not affect their business.
“We already knew that our attendants deserve to be paid overtime and we've already been doing it for 27 years, since in business,” said Rhonda Kelly, Senior Vice President and Chief Financial Officer of At Home Healthcare. “Our costs will not change and therefore we will not be passing any additional costs along to our patients.”
“People need to rest easy,” Bratteli said. “Employers don't really have to worry. If they're already paying people minimum wage or better, then they're already in compliance with the law.”
The requirement does not go into effect until January 2015, but local agencies reiterate that they do not expect the change to impact their costs or services.
Monday, September 1 2014 2:00 AM EDT2014-09-01 06:00:48 GMT
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