Vt. minimum wage hike could impact Medicaid long-term care program

Published: Jan. 22, 2020 at 5:52 PM EST
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An unintended consequence of raising the minimum wage in Vermont may lead to a budget crisis for a long-term care Medicaid program that helps patients stay out of nursing homes.

Merton Hill lives alone in Cambridge. He suffered a stroke four years ago and is now unable to perform daily tasks like cleaning his house or cooking meals. "I can't write, I can't read. That right there makes it very hard for me," Hill said.

Lamoille Home Health and Hospice staff visit Hill on a daily basis to help him cook, clean and keep him company. The program is called Choices for Care. Because of programs like these, there are about 500 fewer Vermonters in nursing homes, saving Vermont's health care system money.

But there could soon be more pressure on the program's budget if a $12.55 minimum wage hike is approved. "We're spending 27 percent more to provide the service than we're receiving from the Medicaid program," said Jill Olson with the VNAs of Vermont, a statewide organization representing home health agencies.

She says half of the Vermonters working in the program switch jobs every year and that 25 percent of its personal care jobs are vacant.

About 600 of those workers currently make under $15 an hour.

Sponsors of the increase say it will relieve the burden off of other areas like food stamps and child care subsidies. "Will make it easier for them to make ends meet, and we know every time the whole culture can invest in people at the lower end of the economic spectrum it helps us all out because they're not struggling as hard," said Rep. Tom Stevens D-Waterbury.

He says if the bill passes, Medicaid funding and reimbursement will be determined through the appropriations process.

But as for Choices for Care, the VNA's Olson says their funding structure remains murky in an already strained budget. "How long can we go with the vacancy rate we have, the turnover rate and the losses we see in the program," she said.

Whether the bill passes or fails, Vermonters like Hill say they will continue to depend on care providers. "My God, I don't know what I'd do without those girls. They're very, very good to me," he said.

Sponsors of the bill say raising the minimum wage to $12.55 over two years is a good compromise and the governor should be able to get behind it.