Case Studies of Six State Personal Assistance Service Programs Funded by the Medicaid Personal Care Option. VI. Attendant Issues: Family Providers, Wages, Benefits, Withholding


A. Family Provider Regulations

The program has used a rigid HCFA definition of family exclusions (i.e. husband, wife, parent, child, sibling, adoptive child, stepparent, stepchild, stepbrother, stepsister, father in law, mother in law, daughter in law, sister in law, brother in law, grandparents, grandchild are not allowed to become providers) since 1982, but compliance wasn't monitored before West Mont. The exclusion of all family providers apparently caused particular problems for Native American consumers, who have a strong cultural tradition of family support. Many of these consumers simply dropped off the rolls.

B. Attendant Wages

The starting hourly rate for West Mont attendants is $4.00, which is raised to $4.30/hour after 3 months. This wage is paid for travel to and from the recipients home, as well as time on site. The demands of a growing caseload have increased pressure on West Mont to recruit and maintain an adequate labor pool. West Mont and the DSRS, pointing to an attendant turnover rate of approximately 150%, have lobbied the legislature for increases in the per unit reimbursement by the state, in order to pay for increased attendant training, wages and benefits, as well as increased administrative costs. The reimbursement level has been increased, but in order to curtail the increasing costs of the program, services have become more limited.

The state currently pays a total of $7.75/hour of service, 71% of which goes to attendants. Overall, West Mont Administration says that 89% goes to salaries and taxes and 11 % goes to fixed costs. The specific breakdown provided by the SDSD is:

  $ 5.52   PCA Wages and Benefits (including overtime)  
$ 0.97 Administrative Staff (includes scheduling)
$ 0.67 Rent, Supplies, Travel, etc.
$ 0.47 Nurse Supervision for PCAs
$ 0.12 PCA Training
$ 7.75 Total Cost Per Hour

C. Attendant Benefits

Social security and worker's compensation are deducted, and health insurance is offered. Personal leave and overtime for holidays are also offered.

D. Withholding and Liability Issues

As can be seen from the program's history, attendant liability issues were a critical catalyst in Montana's decision to switch to an agency provider. Until 1984, attendants were paid $3.85 an hour, $.50 of which was supposed to go to social security, worker's compensation and unemployment insurance. In fact, most attendants did not do any withholding, and pocketed the entire $3.85/hour. In 1984, some former attendants applied for unemployment insurance. The DSRS claimed that the attendants were independent contractors, but the Montana Department of Labor ruled that attendants were state employees eligible for worker's compensation and unemployment, and that the DSRS was responsible for withholding FICA. The DSRS appealed the decision, but ultimately paid back withholding to the DOL.

The state did not want the 1500 attendants considered as state employees, and feared that the DOL ruling would be used to lobby for provision of full government worker benefits to all attendants. To avoid this possibility as well as to be rid of withholding responsibilities, the state administration decided to shift to an agency mode as soon as possible. When a single state provider agency was selected, the majority of attendants working in the program became West Mont employees. Because West Mont began to do withholding, attendants received $3.35/hour and the other $.50 went for benefits. Attendants lobbied the legislature because they felt they had in fact received a pay cut. At that time, West Mont began to receive $5.15 per hour to cover the costs of nurse supervision, administration, and an additional $.19 needed to augment the withholding for attendants. Lobbying has continued to increase the state reimbursement rate in order to provide higher wages and benefits.


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