Dive Brief:
Cutting Medicaid could worsen already serious shortages of home care workers in the safety-net insurance program and decrease their payment rates, according to a research survey published Tuesday by KFF.
All 48 states that responded to the survey conducted by the health policy research firm reported Medicaid home care workforce shortages in 2024, while 41 said home care providers had permanently closed their doors in their states within the last year.
Increasing payment rates to home care providers is the most common method states are using to address staff shortages, according to the brief. But if House Republicans follow through on potential spending cuts to Medicaid, states may need to reduce provider pay.
Dive Insight:
Medicaid, along with the Children’s Health Insurance Program, provides coverage to nearly 80 million low-income Americans and is likely on the chopping block for congressional Republicans as they look to balance out President Donald Trump’s promised tax cuts.
Last week, House Republicans released a budget blueprint that called for the Energy and Commerce Committee, which oversees Medicare and Medicaid, to find $880 billion in savings.
Though the safety-net insurance isn’t the only program under E&C’s purview, it’s “by far the biggest,” — suggesting cuts to Medicaid could be significant, according to a post on X Wednesday by Larry Levitt, executive vice president for health policy at KFF.
Reducing Medicaid spending could also significantly hit the home care workforce, as nearly 70% of these services are paid for by the insurance program, according to KFF.
The firm’s research, which surveyed officials administering Medicaid home care programs, found provider shortages were already widespread, particularly for direct support professionals and personal care attendants.
All states said they faced shortages for more than one type of provider, while 46 reported shortfalls among five or more provider types, according to the brief.
All surveyed states face home care worker shortages
Number of states that reported they were experiencing a shortage of each provider type
The deficits are likely related to low wages and demanding work conditions for home care providers — worsened by staffing shortages that could force them to work longer hours to compensate, according to KFF.
However, many states were unable to report average payment rates for all providers, given that these services are often bundled together and many states outsource this work to Medicaid managed care plans.
But among those that could offer payment rate data, payments for personal care workers ranged from below $10 an hour to over $20 per hour.
Increasing provider pay was the most common state strategy for boosting Medicaid home care workforce
Number of states reporting each method of raising the number of home care workers
Meanwhile, most states are on the brink of exhausting enhanced funding for Medicaid home care provided under the American Rescue Plan Act enacted in 2021, according to KFF.
The vast majority of the additional $37 billion in federal funds went toward workforce recruitment, retention and training. Thirty states surveyed by the health policy research firm said their top priority was keeping higher provider payment rates spurred by new money, far surpassing other options like adding or expanding services or eliminating wait lists for home care.
