The Home Health Aide:

Scare Resource In A Competitive Marketplace

By Steven L. Dawson and Rick Surpin

“In all geographic regions of this country, there is an on-going inability to hire staff to provide the most fundamental care needed. The crisis for home care used to be lack of adequate business opportunities. Now agencies have to turn away requests for service for a lack of competent, appropriately trained staff.”

~National Association for Home Care
February, 2000 Testimony to the
U.S. Congressional House Committee on Education and the Workforce

The majority of paid care received by home care clients in the United States is provided by a “direct-care” paraprofessional—not a doctor, not a nurse, but a home health aide or personal care attendant[1]. These direct-care staff are the home care delivery system, the very point where home care “touches the client” (Gipson, 1998). Yet our system of care delivery is not now, and never has been, designed around the needs of the direct-care worker.

Today we are paying the price. Across the country, our industry is experiencing the highest rates of direct-care vacancies and turnover in its history—rates so high that many home care agencies are forced to limit care, and increasingly, even turn clients away.

For the past three decades, our home care system was structured on the presumption of a seemingly endless supply of low-income individuals (usually women, and disproportionately women of color) willing to work as aides and attendants. Both agencies and consumers presumed that these women would always be available to offer care and companionship—despite low-quality jobs that kept literally hundreds of thousands of paraprofessionals “working, but poor” (Himmelstein, et. al, 1996).

To undervalue, and even ignore, that which we believe we have an abundance of is simply human nature. Like clean water or the air we breathe, we don’t even think about how essential something is when it seems limitless. Similarly, managers and financiers within the home care industry never had to pay much attention to the supply of home care aides: Who among us just four years ago—facing the market constrictions of the Balanced Budget Act and knowing that Welfare Reform was throwing literally millions of women from welfare into low-wage work—predicted that today we would be experiencing a dearth of home health aides?

Yet now, direct-care staffing vacancies are spreading throughout nursing homes and home care agencies across the country: In the past year, 40 states have created legislation in response to, or formed special task forces to study, the long-term care workforce crisis (Paraprofessional Healthcare Institute, 2000). The very future of the industry now rests on our ability to attract direct-care workers within an increasingly competitive environment. Therefore, we argue below that in order to survive, let alone provide high-quality care, the home care industry must not simply improve, but wholly re-structure, paraprofessional employment.

Labor as a Scarce Resource

The current vacancies of direct-care staff are not due simply to our full-employment economy—to believe so is no more than wishful thinking. Many in our industry unfortunately will be shocked in the coming year when, as the economy begins to soften, high rates of vacancies remain.

In fact, direct-care vacancies will likely increase, because our home care industry now faces a labor market that is profoundly different from the one upon which our long-term care system was originally built. Note in the chart below that the traditional source of “fresh recruits” for direct-care jobs—women in the civilian workforce between the ages of 25 and 44—is projected to decline by 1.4 percent during the next eight years (Fullerton, 1999). Furthermore, the likely decline of this cohort of women in the civilian workforce follows three decades of significant expansion—nearly tripling from 1968 through 1998:

Women Aged 25-44 in the Civilian Workforce

1968-98; projected 2008

Source: 1968 figure is calculated from U.S. Bureau of Labor Statistics http://stats.bls.gov/sahome.html; All other data for 1978-2008 are from Howard N. Fullerton, Jr., “Labor Force Projections to 2008: Steady Growth and Change in Composition,” Monthly Labor Review, November 1999, Table 5, “Civilian Labor Force by Sex, Age, Race, and Hispanic Origin, 1978, 1988, 1998 and projected 2008,” http://stats.bls.gov/opub/mir/1999/11/art3full.pdf

This tripling occurred due to two factors multiplying upon one other: During those 30 years, an increasing number of women from the Baby Boom generation came of adult age, while at the same time a sharply increasing percentage of those women participated in the workforce (45.0 percent participation in 1968, rising to 76.7 percent in 1998).

Yet what we face over the next decade is the Baby Boom workforce passing through this age range, leaving a smaller, Post-Baby Boom workforce to follow. Moreover, the increased rate of participation of women in the workforce will slow considerably (76.7 percent in 1998 to only 79.5 percent projected for 2008) (Fullerton, 1999). Clearly, the supply of traditional paid caregivers has changed fundamentally from what the home care industry was once able to presume.

Finally, by placing these supply side demographics within the context of what we already know about the likely increase in demand for long-term care services, the true depth of the coming “care gap” becomes apparent. For one dramatization of this growing mismatch between the supply and demand for direct-care services, note below that the U.S. elderly population is projected to double over the next 30 years, while the “traditional” female caregiving population—the larger cohort of women of care-giving age in the general population between the ages of 25 and 54—is projected to grow during that same period by only 7 percent:

The Care Gap: Women of Care-Giving Age and Elderly in U.S., 2000-2030

(females aged 25-54; individuals 65 and older)

Source: U.S. Census Bureau, National Population Projections, Summary Files,

“Total Population by Age, Sex, Race, and Hispanic Origin,” http://www.census.gov/population/www/projections/natsum-T3.html

This chart already presumes immigration rates at moderate to high historic highs—again, some in our industry may be disappointed to learn that increased immigration will likely prove to be only one very small part of the staffing crisis solution. Furthermore, note also that this is a chart depicting national data; in states with a relatively high rate of elderly and relatively low rates of immigration (e.g., Pennsylvania), this demographic mismatch is even more acute.

In short, the emerging “care gap” between the demand for and supply of direct-care workers is a long-term structural problem that will persist, even if higher unemployment rates return: Given the very low population and labor force growth projected over the next several decades, a “normal” business cycle recession will likely result in only a modest increase in the number of unemployed. Dr. Richard Judy, director of the Hudson Center for Workforce Development, suggests that the United States over the next 20 years can expect unemployment rates to vary only within the narrow range of 3.5 to 6.5 percent.

Viewed from a slightly different perspective, we can use this same data to calculate an “elderly support ratio” that compares the relative availability of caregivers over time. As the chart below shows, the U.S. population currently includes 1.74 females aged 25 to 54 per elderly person, at a time when we are already experiencing significant direct-care vacancies. Yet this ratio will decline steadily over the next 30 years and, by 2030, reach a point where there will be fewer than one woman of caregiving age per elderly individual.

Elderly Support Ratio, 2000-2030

(females aged 25-54 per individual aged 65 and older)

Source: calculated from U.S. Census Bureau, National Population Projections, Summary Files, “Total Population by Age, Sex, Race, and Hispanic Origin,” http://www.census.gov/population/www/projections/natsum-T3.html

Unfortunately, this shrinking ratio of support will place pressure not only on the formal, paid health care delivery system but also on family caregivers. Since women provide the majority of both paid direct-care services and family care, this “care gap” in the U.S. will increasingly become a double-bind: When families who cannot care for loved ones at home by themselves turn to the formal system for assistance, they will find relatively fewer paid staff available.

Thus U.S. demographics alone force us to accept a new reality: The home care industry has entered an entirely new era in which labor is not only scarce, it will become increasingly scarce. Although a full-employment economy has certainly exacerbated the problem, the economic growth of the last eight years has been a cyclical phenomenon hiding the deeper truth of structural demographic shifts within the American workforce: For the first extended time in our history, home care agencies must compete within the marketplace against other employers for direct-care labor—and that reality is now turning our industry upside down.

The Response

From the perspective of the direct-care worker, attraction to and remaining employed within the home care industry is not a very complex question. Analyzing focus group discussions among current and former direct-care staff (New Hampshire Community Loan Fund, 1999), confirmed what the authors have consistently heard for the past 15 years from home health care workers in New York City—that the five essential elements of a competitively attractive job are:

• A “family wage,” health insurance and other benefits;
• Balanced and safe workloads that offer full-time employment but do not overwork employees;
• More comprehensive and effective forms of training;
• Opportunities for advancement and professional development; and
• Employee support—both on the job (e.g., improved supervision) and in the community (e.g., affordable child care).

There is little mystery here: These five elements are likely to be what any individual, particularly someone who has an increasing number of employment options, would ask of any employer. Given that these paraprofessionals are paid primarily by American taxpayers, we could reasonably argue that our long-term care system simply has an obligation to create health care jobs that provide a livable wage; that our publicly funded health system has a responsibility, at the very least, to guarantee its own workers health insurance. Yet historically, moral suasion alone has failed to forge significant improvements in the quality of direct-care jobs.

Therefore, we will argue primarily from the perspective of the self-interest of the industry. Yet no matter how pragmatic the reason for improving the job quality of the home care paraprofessional, providing these five essential elements—in essence treating direct-care workers as not only a scarce, but a valuable, resource—is such a dramatic change from industry norms that an effective response will require fundamental, structural changes in both industry practice and public policy.

Industry Practice

The center of home care is not the client; the center of home care is the relationship between the client and the caregiver. Both individuals are present at the moment of care, both are human beings, and thus our system of home care must be designed around the needs of both individuals.

For example, we have long structured the provision of home care as primarily a morning occurrence, because of client need and preference. Yet such a delivery system presumes a legion of part-time workers, serving cases in the morning, but being otherwise unemployed for the rest of the day. Clearly, the result of that design is poverty-level income for paid caregivers.

Creating an attractive job within home care, therefore, must address this issue structurally, by fashioning full-time employment. Only in this way can the typical home health aide job will become stable work that will attract and retain competent caregivers.

This is merely one example of the type of structural change that must be undertaken by home care agencies, but it suggests how difficult those changes will be: Such changes will require altering scheduling and reporting systems within the agency; they will require working with other agencies and systems outside the agency; and they will require management and staff who think, act and even “believe” differently about how care can be delivered within the home.

This last is the most difficult of all, because we have built our agencies with staff and leaders during an era that has now passed. Our clinical staff, for example, were never trained how to train, supervise and coach a paraprofessional workforce that is not only a valued human being, but also a scarce resource. Earlier, when a home health aide displayed a pattern of late arrivals or cases refused, she was likely dismissed—because there were likely five other women standing in line to take her place. Now, we need management and supervisory staff with expertise in identifying and helping to solve the problems that are causing that aide’s pattern of “unacceptable performance”—obstacles such as inaccessible childcare, domestic abuse, or ironically, the lack of decent health care.

Rebuilding an agency—through restructuring, re-training and in some cases replacement of current management and supervisors—is so challenging that it requires support and creativity from other, like-minded leaders. Therefore, the home care industry might consider creating a support network of “next generation” agencies, modeled after the Pioneer Network of nursing homes, which represents more than 20 facilities and systems across the country dedicated to changing relationships between clients and caregivers within long-term care (www.pioneernetwork.net).

Public Policy

Although much can be done today to re-shape our home care agencies from within, clearly we are limited by a splintered and dysfunctional public policy environment. The environment that impacts our direct-care workforce includes not only home care policies at the state and federal levels, but also labor policies designed to improve employment prospects for all U.S. citizens, and welfare policies designed both to help families living in poverty and people transitioning from welfare to work.

Unfortunately, health care delivery policy has been designed without recognition of its labor impact, particularly on low-income workers. For example, reimbursement rates typically reflect historic, not current, labor market conditions. When labor competition in the economy is low, this structure allows the health care system to “bargain” for workers at the lowest price possible. Yet when budget constraints collide with heightened labor competition, as is now the case, the health care system is unable to offer competitively attractive employment.

Furthermore, the federal Department of Labor invests more than $8 billion annually to prepare Americans for new and better jobs. These funds are then augmented by state and local funding. Although many government training and employment services are available to all citizens, the majority of them are targeted toward low-income and unemployed individuals.

However, state and federal employment agencies often preclude the long-term care industry from participating in training support programs—on the basis that training graduates cannot earn a livable wage as direct-care workers (New York City Department of Employment, 1999). While the public-policy basis for high-wage standards is clear (public employment programs do not want to support poverty-level jobs), the irony remains that these low-paying paraprofessional jobs are paid for primarily by federal and state health agencies.

Finally, since direct-care staff members typically are low-income women, they often find themselves both supported by, and entangled in, public-agency systems designed to improve their living conditions and increase their employment prospects. For years, low-income women have straddled the two worlds of welfare benefits and health care employment. Some have moved back and forth between the two, leaving welfare for health care work but then cycling back to public assistance as soon as the next family crisis hit. Many other low-income women have continued to receive cash, food stamps, and other forms of public assistance—even while employed as direct-care workers—because their part-time, direct-care jobs offered only poverty-level income.

This interweaving of welfare and health care employment has long provided a hidden subsidy to the health care system. Providers could offer artificially low wages and no benefits, forcing their workers to rely, at least in part, on public assistance programs for the necessities of food, housing, and health insurance. “Welfare reform,” however, has essentially removed that hidden subsidy, without providing adequate job supports to lift women fully out of poverty.

Therefore, although health, labor, and welfare policies all intersect the lives of direct-care workers, none are designed with the health care worker in mind. To be fully successful in re-creating home care agencies as providers of high-quality employment, our industry must require of public policy makers that they approach long-term care employment as a whole “employment sector,” coordinating all three public policy sectors in support of the direct-care workforce.

Conclusion: Alliances and Compromise

These changes in industry practice and public policy are far too large for the home care industry to undertake alone. Inherent within the home care system are three key stakeholders: provider agencies, consumers and workers. All three must work together for fundamental change to occur. Furthermore, given the demographic trends noted above, home care agencies must accept the reality that in the coming years, both consumers (and their advocates) and workers (and their representatives) will become increasingly powerful—consumer groups will become more powerful as the aging population swells; and health care unions and paraprofessional associations will become more powerful as, ironically, paraprofessional workers become relatively scarce.

To succeed in the coming era of labor scarcity, home care leaders must not fear the growing power of consumers and workers, they must encourage it—for only the organized voices of consumers and workers have the political power to demand adequate resources and effective delivery of long-term care services. {Clearly, the political performance of the home care industry in the face of the Balanced Budget Act during the past four years has taught us that the industry alone is incapable of articulating a compelling case for home care services.}

In particular, home care leaders should engage in alliances at both the state and national levels with both consumer organizations and various forms of organized labor (both health care unions and direct-care worker associations)—forging a united perspective among the three key home care stakeholders. Only through such a tripartite political strategy can the home care industry hope to secure the enormous resources and regulatory flexibility necessary to compete within the new labor market reality.

However, such an alliance will require creativity and compromise on the part of each stakeholder—among many other issues, consumers must likely accept more flexibility in the delivery of care in exchange for a more stable, competent workforce, and providers and labor associations must work together to create truly supportive work environments for both front-line workers and supervisors.

The most fundamental re-structuring of all, perhaps, will be the eventual inclusion of consumers and workers in the governance of our agencies—“opening up the boardroom” to those most directly impacted by the care we provide. Such a representative governance structure, of consumer and worker representatives on corporate boards of directors, could be created within either a nonprofit or for-profit agency, and is a powerful counterbalance to the prevailing method of public oversight—ever greater regulatory strictures. For example, Cooperative Home Care Associates, a 600-worker licensed home care agency in the South Bronx, New York, is an employee-owned provider whose board of directors includes a majority of home health aides and administrative staff.

We’re not in the 20th century anymore, and home care will never be the same. Those who hope that the industry’s environment will dramatically improve—without supporting a strong consumer voice and a sophisticated role for various forms of organized labor—are ignoring the inexorable demographics of America’s 21st century.

Steven L. Dawson is president of the Paraprofessional Healthcare Institute, Bronx, New York. Rick Surpin is president of Independence Care System, New York, New York and is chair of Cooperative Home Care Associates, Bronx, New York.

Adapted, with permission, from Direct Care Health Workers: An Unnecessary Crisis in Long-Term Care, Published by the Domestic Strategy Group of the Aspen Institute, Washington, D.C., 2001.

References

Fullerton, H. N., Jr., 1999. “Labor Force Projections to 2008: Steady Growth and Change in Composition,” Monthly Labor Review, November.

Gipson, G., 1998. Career Nurse Assistant Programs, Inc.

Himmelstein, D.U., Lewontin, J.P., and Woolhandler, S., 1996. Medical Care Employment in the United States, 1968 to 1993: The Importance of Health Sector Jobs for African Americans and Women.” American Journal of Public Health, April, Vol. 86, No. 4.

Hollmann, F.W., Mulder, T.J., and Kallan, J.E., 2000. Methodology and Assumptions for the Population Projections of the United States: 1999 to 2100. Population Division Working Paper No. 38, Washington, D.C.: Population Division, Bureau of the Census, U.S. Department of Commerce.

Judy, Richard W., 2000. Testimony to the Subcommittee on Oversight and Investigation, Committee on Education and the Workforce, U.S. House of Representatives, February 17. Hudson Institute, Indianapolis, Indiana.

New Hampshire Community Loan Fund, 1999. Focus Group Analysis, Concord, New Hampshire.

New York City Department of Employment, 1999. Regulations issued for the Job Partnership Training Act, New York, New York.

Paraprofessional Healthcare Institute, 2000. State Staffing Survey. Bronx, New York.

Abstract

Direct-care staff—home health aides and personal care attendants—are the very point where home care “touches the client.” Yet our system of care delivery has never been designed around the needs of the direct-care worker. Today we are paying the price: Across the country, our industry is experiencing the highest rates of direct-care vacancies and turnover in its history.

The very future of our industry now rests on our ability to attract workers within an increasingly competitive labor market. In order to survive, let alone provide high-quality care, the home care industry must wholly re-structure paraprofessional employment.

[1] Although many of the issues we review here also affect the nursing professions, this article defines “direct care” staff exclusively as the paraprofessional workforce within our home care system.