DOL Guidance Could Lead to More Home Care Companies Providing Live-In Services

The U.S. Department of Labor (DOL) recently issued an opinion letter allowing home care agencies to implement consistent shift rates that include pre-payment of overtime for caregivers who provide live-in services.

In this case, a “live-in shift” is defined as being on the job for 24 hours or more at a time.

Broadly, the DOL’s opinion letter makes it administratively easier to compensate live-in caregivers. Live-in caregivers work extended periods in a client’s home, even residing there on a near-permanent basis in some cases.

Specifically, the guidance from DOL allows home care agencies to blend anticipated overtime hours worked by the end of the work week into each daily shift, before the overtime is actually earned for the week. This allows agencies to pay the same rate for each shift based on total anticipated hours.

Typically, compensation for live-in caregivers is quantified on a per shift basis, with some agencies quoting pay rates.

Contextually, the compensation process for live-in caregivers became more complicated in 2015 after regulators decided to eliminate a previous live-in exemption, Angelo Spinola, co-chair of the home health and home care industry group at law firm Littler Mendelson, told Home Health Care News.

“[Live-in caregivers] were paid a flat day-rate, and there wasn’t a lot of concern or consideration as to how many hours they were actually working,” he said. “The law changed. But the industry didn’t change for a while, and you still have companies that are unaware of what it is that they need to do to be compliant.”

Getting an opinion letter from the DOL on this matter was the result of ongoing legal efforts from Littler Mendelson, which represented a group of home care providers.

Spinola called this effort a good example of the home care industry working together to get in front of an issue.

“More than ever, this industry has been working together on these sorts of projects to proactively attack and address issues that have hounded the industry for years,” he said. “This was a small group of providers that pooled resources to achieve this result that will be useful and helpful for the entire industry. We are seeing that in multiple states.”

For providers, the DOL’s new guidance supplies definitive answers on how to compensate live-in caregivers. When handled incorrectly, this was a process that potentially spelled legal trouble for providers.

“There have been so many attorneys who have brought class-action lawsuits on behalf of live-in caregivers — making the argument that the shift-rates are impermissible day-rates,” Spinola said.

Lowering the risk of future litigation against home care providers could result in more companies offering live-in services.

Amid the COVID-19 public health emergency, the demand for live-in services has grown, with more seniors opting to shelter in place.

Spinola pointed out that, in the past, some clients have shied away from offering live-in services at their home care agencies to avoid legal challenges.

For home care agencies looking to start providing live-in services, setting them up the right way will be the key to success, according to Spinola.

“You have to understand what the rules and requirements are in your jurisdiction, in your state,” he said. “Have a live-in agreement that explains those rules and expectations on the caregiver side and on the client side, so the client understands how many hours they have contracted for.”

Spinola noted that agencies have run into trouble when trying to reverse engineer rates without regard to the actual time that was worked.

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Top Home Health, Home Care Legal Concerns for 2021

Wage-and-hour litigation, confusing state-level regulations and an increase in federal audits were among the biggest legal trends of 2020. While many of these issues will remain in the year ahead, 2021 will also bring several more legal hurdles for home-based care providers.

The decision of whether to mandate COVID-19 vaccinations for home health and home care workers is toward the top of that list. Other emerging legal battles that will shape 2021 include telehealth dos and don’ts.

To keep in-home care operators in the legal loop, Home Health Care News reached out to four attorneys who specialize in the field. The group of legal experts offered their take on the biggest focus areas of 2021.

Their responses are below, edited for length and clarity.

* * *

An enormous challenge home care and home health providers face is remaining compliant with the myriad of federal, state, and local laws and regulations that continue to change at a record pace. It is critically important that providers have a comprehensive legislative tracking process and adopt proactive compliance strategies to both identify changes and modify their policies and procedures to conform appropriately. Providers that operate in multiple jurisdictions or states are especially confronted with this challenge.

One of the most straightforward examples is ensuring compliance with the payment of varying minimum-wage rates. The federal minimum wage is currently $7.25 per hour. However, the Biden administration will likely seek a $15 federal minimum wage. Many states already require a higher minimum wage, such as Colorado’s $12.32 requirement. Some states — such as California — have local jurisdictions, each with its own unique minimum wage requirements that often depend on the number of employees within a given business.

Another major trend to watch out for is the enactment of Domestic Workers Bills of Rights (DWBRs) across the nation. These laws provide specific requirements that employers within a given jurisdiction must adhere to with regard to minimum wages, overtime wages, discrimination and harassment complaints, training requirements and much more. Last year, Philadelphia became the 10th jurisdiction to enact employment legislation to protect domestic workers — and some may recall the federal DWBR legislation sponsored by Kamala Harris in 2019.

We can anticipate a revival of that effort under the Biden administration.

Angelo Spinola, co-chair of the home health and home care industry group at Littler Mendelson

* * *

If I had to pick one legal issue to watch in 2021, it would be health care payment and coverage reform. While the Affordable Care Act was enacted over a decade ago, its wake continues to make waves in the health care sector. Legal challenges remain unresolved in the courts. Twelve states have not expanded Medicaid. Over 10% of Americans remain uninsured. Federal agencies continue to use their broad regulatory authority to push providers toward value-based reimbursement.

With the inauguration of Joe Biden, I anticipate seeing significant efforts to build on the ACA and, potentially, legislative attempts to expand coverage. While Democrats will control the White House and both chambers of Congress, their razor-thin margin in the Senate makes “Medicare for All” proposals unlikely.

Although the regulatory proposals have been overshadowed by recent events, the Trump administration has proposed or finalized rules that could have a significant impact on provider payment and oversight. A significant theme in 2021 will be the extent to which the Biden administration alters or replaces those rulemaking efforts

As we emerge from the pandemic — hopefully soon — federal and state governments and private payers will examine the many regulatory waivers and flexibilities granted during the public health emergency. Which ones will stay? Which will go? Only time will tell.

— Matt Wolfe, partner at Parker Poe

* * *

2020 shined a spotlight on the importance of home health care, as in-person doctor visits were no longer accessible to seniors and facility-based providers dealt with depleted resources and fewer available beds. As access to services dwindled and remote care began to flourish, a massive inequity affecting home health care was revealed.

Remote care services are frequently not reimbursable in a home health setting — and any home health visits delivered via telehealth do not count toward LUPA thresholds during an episode of care. That policy essentially punishes these home health providers that use telehealth to supplement in-person care. In an environment swiftly moving toward value-based outcomes and technology-driven efficiencies, this disparity became evident to policymakers, who are now working toward a remedy.

For those companies who rely on fee-for-service income, the motivation to transform businesses using new technologies will continue to lag unless we figure out a way to increase financial incentives to enable such transformation. We should expect to see innovative home health companies form or participate in value-based enterprises under the newly published Anti-Kickback Statute safe harbors as a way to compensate for the current lack of reimbursement for virtual services.

— Rebecca Gwilt, partner at Nixon Gwilt Law

* * *

The first half of 2021 will keep providers occupied with getting their employees and patients vaccinated. The pandemic has caused, in many respects, the reduction of home care hours as patients are concerned about aides bringing COVID-19 into the home.

The vaccine offers providers the opportunity to reassure their patients that the aides are not bringing the virus into the home. In turn, it’s a way to increase hours. Therefore, we anticipate that providers will launch wide-scale efforts to get their workers vaccinated. This will involve helping the caregivers understand the importance of being vaccinated and, in some cases, conditioning future and continued employment on the employees’ agreement to become vaccinated.

— Emina Poricanin, managing attorney of Poricanin Law

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NAHC, NHPCO, Others Release Vaccine Guidance for In-Home Care Providers

The dichotomy in the U.S. right now is evident, especially for those in health care: While vaccines and coinciding hope are being injected into Americans, the number of new COVID-19 cases each day continues to climb.

And while every home-based care provider and worker keeps reading that the vaccines — both Pfizer’s (NYSE: PFE) and now Moderna’s (Nasdaq: MRNA) — are here, they’re wondering where.

Vice President Mike Pence and his wife, Karen Pence, were both vaccinated on video Friday. Senate Majority Leader Mitch McConnell (R-Ky.) tweeted out a picture of himself post-vaccination as well. Hospital workers have danced on TikTok celebrating the Pfizer-BioNTech vaccine’s arrival at the Boston Medical Center.

But for the home-based care world, key information regarding the vaccines is still hard to find.

“We don’t know not only when but where,” David Totaro, the chairman of the Partnership for Medicaid Home-Based Care (PMHC), told The Philadelphia Inquirer last week. “We don’t even know how we’re going to be notified.”

Over the last week, most of the major home-based care trade organizations have released guidance for providers on how to handle vaccinations in the workplace.

Home-based care workers have been labeled 1a — or highest priority — to receive the vaccine in most states.

The National Association of Home Care & Hospice (NAHC), for instance, is telling providers to “encourage all home care and hospice staff to receive a COVID-19 vaccination at the earliest possible time consistent with vaccine guidance.”

The national association suggests providing the support necessary to help workers gain access to the vaccine as soon as possible as well as access to comprehensive and fact-based information regarding immunization. It also reiterated the importance in following safe protocols throughout the pandemic in the meantime.

The Home Care Association of New York State released similar guidance, and the National Hospice and Palliative Care Organization (NHPCO) released a statement of its own.

“Hospice and palliative care professionals are on the front lines of health care delivery in this country. Not only are they serving the most vulnerable population with complex medical needs, but they are caring for people in their homes, interacting with family caregivers, and traveling throughout the communities they serve,” NHPCO President and CEO Edo Banach said. “For their own protection, the safety of those under their care, and the welfare of their families and communities, NHPCO encourages these dedicated professionals to receive the COVID-19 vaccine.”

Each state’s plan to roll out the vaccine is different, so organizations that work in multiple states will have to do their due diligence in each region to ensure that their workers have access to one of the two vaccines as soon as possible.

Still, the home-based care organizations stopped short of encouraging mandatory vaccinations for workers, despite their assurance that immunization will be safe and effective in stopping the spread of COVID-19.

“The next thing that we’re trying to address right now is whether or not vaccines should be mandatory among our staff,” Totaro said during Home Health Care News’ Capital+Strategy event earlier this month. “And that’s a very, very complex issue. We’re taking it very seriously.”

San Francisco-based law firm Littler Mendelson released a client alert to home-based care organizations this week regarding that issue.

For many reasons, Littler is urging providers to wait before taking a firm position on mandatory vaccinations for workers.

“Employers really cannot make vaccinations completely mandatory,” Angelo Spinola, a shareholder at Littler Mendelson, wrote. “They must always allow exceptions based on health and religious beliefs.”

Spinola urged home-based care clients to consider a handful of questions: Firstly, are there exclusions regarding who should receive the vaccination, from a medical perspective?; Will there be side effects to the vaccine that could hurt employees?; Are your employees reticent or or enthusiastic about the vaccine?; And how are others in the industry responding?

Those questions all suggest that providers should wait before making the call. In some states, health care workers are required by the government to receive flu shots, for instance. If the government could make vaccines mandatory, Spinola urges providers to let lamakers do it first.

Plus, there are other things to consider.

“Mandatory vaccinations may lead to potential workers’ compensation claims from employees who suffer an adverse reaction to a potential vaccine,” he wrote.

In any case, encouraging vaccination, but stopping short of mandating them, seems to be the resounding guidance right now from industry insiders.

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Lack of Stimulus Bill Could Lead to Rise in COVID-Related Lawsuits

Throughout 2020, there have been a number of new laws and legal trends that could have major impacts on the in-home care industry. In order for providers to be successful in the long run, it’s important to remain abreast of the latest developments.

That was the message delivered by Angelo Spinola, an attorney and shareholder at Littler Mendelson, during this year’s National Association for Home Care & Hospice (NAHC) annual conference.

Among key legal developments, Spinola touched on the Families First Coronavirus Response Act (FFCRA), which creates paid leave — both sick leave and family medical leave — for employees who satisfy certain conditions.

When it comes to the FFCRA, the status of the health care provider exemption should be an area of interest to providers, according to Spinola.

When the law originally went into effect in April, the U.S. Department of Labor (DOL) created a broad exemption for health care providers.

“It certainly covered home health providers … and arguably covered most of the non-medical home care providers as well,” Spinola said. “What the [DOL] allowed companies to do, if you did meet the exemption, is exempt everybody within the entity, meaning it wasn’t specific to the employee. It’s whether the employer would qualify as a health care provider.”

Under the law, providers who qualified for the exemption could elect to not offer coverage to any of their employees, or they could offer partial coverage, such as paid sick leave, but not paid family medical leave.

“There were many home care agencies that were doing just that; they were offering the paid sick leave, but not the paid family medical leave,” Spinola said. “The reason for that decision is that companies were really concerned about losing caregivers for an extended period, for 12 weeks of time, because their children were out of school. [They were concerned about] not having anyone available to care for their clients.”

Recent rumblings in New York have caused confusion around what companies qualify for the exemption, however.

The state of New York issued a legal challenge to DOL regulations, effectively saying that the department exceeded its authority in making the health care provider exemption so broad.

Generally, the state of New York challenged four elements of the FFCRA regulations including the work availability requirement, the definition of health care provider, intermittent leave and the documentation requirement.

The state won on all grounds.

“What does this mean for you?” he said. “It means that if you were relying on a health care provider exemption to exclude coverage under the FFCRA, … there’s some risk to you for having relied on that exemption. You were relying on a broader exemption that has now been struck down.”

The DOL has since revised regulations, and providers need to determine whether their agency is subject to the FFCRA.

As far as other steps providers should take, it’s crucial to determine whether it’s in the company’s best interest to provide full or partial FFCRA benefits to all employees. Providers should also communicate with employees, as well as implement an arbitration program, according to Spinola.

Stimulus package, qualified immunity

The next coronavirus-related stimulus package remains top of mind for providers.

When it comes to advocacy initiatives, most providers had five key areas of focus.

These areas include increased pay for front-line workers to discourage many from going on unemployment, child care support for caregivers, priority access to personal protective equipment (PPE), qualified immunity and the creation of an “HCBS Direct Care Worker Fund.”

In May, House Democrats unveiled the Health and Economic Recovery Omnibus Emergency Solutions (HEROES) Act, a COVID-19 stimulus bill. The bill included most of the five industry initiatives except for qualified immunity.

Ultimately, the bill passed out of the house, but couldn’t pass in the Senate.

Another stimulus package, the Health, Economic Assistance, Liability Protection and Schools (HEALS) Act, was introduced in July. Out of five industry initiatives, the bill only included paid child care and qualified immunity. The legislation failed to pass out of the Senate.

“The problem that we are seeing is there’s no movement right now,” Spinola said. “They’re $2.5 trillion apart. There are significant differences between the two acts.”

While it’s impossible to say what will happen, Spinola pointed to the state of the economy as an indicator of the future.

“I think that what might happen is directly tied to the state of the economy,” he said. “We saw the economy really tank. We saw record unemployment claims. …I think we are seeing now because the economy is starting to rebound, there’s less pressure on Congress to create this stimulus package.”

As the election draws closer, there will be less focus on the stimulus bill.

“That’s concerning because that means a lot of the things that we were hoping to accomplish, … we might not get,” Spinola added.

In particular, if qualified immunity doesn’t pass, it puts the industry in a very vulnerable spot for litigation.

Overall, there have been at least 792 COVID‐related labor and employment lawsuits filed against employers, and more than 2,000 general COVID‐related lawsuits. More than 10% of these cases include class-action claims.

“Not surprising that since COVID hit, we’ve seen an increase in related cases,” Spinola said. “Each month, the number gets higher and higher, and we’re going to continue to see this. Unfortunately, we are seeing it specifically in the health care space.”

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New Court Ruling Creating ‘Tremendous Amount of Confusion’ Over Paid Leave in Home Care

After a Monday ruling regarding the Families First Coronavirus Response Act (FFCRA), many home-based care agencies are no longer considered health care providers, meaning they’ll now be forced to abide by robust federal paid-time-off mandates.

“There’s a tremendous amount of confusion [over this], and I think that a lot of providers do not understand what the impact of this decision is — and what it means,” Angelo Spinola, an attorney and shareholder at law firm Littler Mendelson, said on an emergency webinar addressing the ruling Thursday.

The ruling, which was made by the Southern District of New York, found that the U.S. Department of Labor (DOL) was too broad in its original definition of “health care providers” and, therefore, exempted too many businesses from FFCRA’s rules.

Home-based care providers had lobbied hard for exempt status, citing their essential role keeping people safely at home and out of hospitals.

FFCRA rules order any company with under 500 employees to allow paid sick leave and paid family leave to an employee who has been struck by COVID-19 or has a family member fallen ill. Rules also apply to those who have a child out of school due to the virus.

That required paid time off can reach up to as much as 12 weeks. Home-based care providers — formerly exempt — may now have to not only abide by FFCRA moving forward, but also pay for not doing so in the past.

Now that the DOL’s definition has been voided, the new definition has officially been law since March 1.

“[A great deal of providers] will no longer be able to utilize — at least as of today — the health care provider exemption,” Spinola said. “That’s irrespective of what kind of employees — caregivers or office staff. That’s the major takeaway.”

Right now, it would appear that this ruling would only affect New York and potentially Connecticut, but Spinola says that’s not necessarily the case.

“[Will it affect providers] outside of New York? The answer to that is not crystal clear,” Spinola said. “It’s not 100% certain, but I will tell you that it is most likely that it does. And from our perspective, you should take the position that it does apply to you.”

The current exemption list for businesses includes: doctors, podiatrists, dentists, clinical psychologists, optometrists, chiropractors, nurse practitioners, midwives, clinical social workers and physician assistants. Additionally, individuals who can certify the existence of a serious health condition under the Family and Medical Leave Act (FMLA).

“Those are the people that would now be defined as health care providers, so that’s not home health. For the most part, that’s not non-medical home care,” Spinola said. “That’s not home health aides, personal attendants, CNAs — none of those positions would qualify as a health care provider. What does that mean? That means that if you as an organization would qualify for FFCRA coverage, you can’t exempt yourself anymore.”

What can be done

The question moving forward is whether anything can be done to rectify the decision in New York.

The two best chances would be an appeal from the U.S. Department of Justice (DOJ) or a revised definition to come about, possibly from the state of New York.

Waiting on an appeal is risky, Spinola said.

A revised definition is more likely, but that would require some help from the DOL.

“Hopefully the DOL will do this, but they’ve got a lot of fish to fry right now, including dealing with unemployment and all these other issues,” Spinola said. “It’s going to take an effort to make that happen. But it is a possibility.”

A revised definition to include more home-based care providers would help, but there would still need to be additional legwork put in to retroactively change the definition so providers wouldn’t be punished from the time from March to August.

If providers don’t abide by the FFCRA and are no longer deemed a health care provider, that could be ruled a minimum wage violation. An employee could file a private suit for back pay and a civil monetary penalty of over $2,000 could be applied, among other fines.

An employee could also file a suit if an agency fails or failed to provide proper family leave.

What providers can do

There’s a lot that providers can do for themselves, William Vail, special counsel at Littler, said on the webinar.

“First off, put a poster in place. Second off, get a policy in place. Third off, have some forms in place,” Vail said. “And most importantly, arbitration agreements — have those in place. Those are great ways to limit any sort of liability that you may have because you didn’t quite exactly do everything right.”

Providers can also tell their employees the situation and explain that they reserve the right to take away the benefits from the FFCRA if something changes.

“Explain that you know that the health care provider exemption may apply, but that you’re choosing to provide benefits,” Spinola said. “And that if the law changes at a later point in time, you reserve the right to revoke the benefits.”

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