About Home Care in California

Summary of the Impact of All the "Well Intended" Laws on Consumers of In-Home Care Services

A recent series "well-intended" new laws and regulations has increased costs that consumers now have to pay for in-home care services. These laws and regulations have dramatically increased the costs for Home Care Agencies to provide services. In order to stay in business, Home Care Agencies must pass on to the consumer the cost of doing business. Unfortunately, this regulatory storm has caused the increase of cost to the consumers of home care services, which are most often the most vulnerable population in the State. All of these new laws and regulations were designed to benefit and enriched the caregivers, but disproportionally has had a negative effect on consumers by making care in the home through an agency costly and often prohibitively expensive.

Another consequence of these new laws and regulations is that it has caused a proliferation of underground private caregivers where people hire a caregiver privately and pay them under the table without paying State or Federal payroll taxes or workers compensation insurance. All these new laws and regulations being in effect causing in-home care agencies to increase their prices has driven many consumers to hire private caregivers and pay them under the table in order to afford the care they need. One sad thing about this is that consumers are vulnerable and usually do not vet the caregiver or do a criminal background check and they are breaking the law by paying a private caregiver under the table.

Overview of the Non-Medical Home Care Licensure Requirements in California
The Home Care Services Consumer Protection Act (HCSCPA)

Under the HCSCPA enacted in October 2013 that took effect January 1, 2016, Family Home Care (FHC), as well as all non-medical in-home care companies in California (no to be confused with licensed home health agency skilled medical care), were required to pay a hefty licensure fee and register with the California Department of Social Services (DSS), Community Care Licensing Division’s (CCLD) new Home Care Services Bureau (HCSB). The HCSB oversees licensing and oversight of Family Home Care and the other State registered home care agencies, (now known as Home Care Organizations (HCOs)). All registered HCOs must obtain a license and license number from the HCSB certifying their compliance with the operational standards set forth by the HCSB in order to provide in-home care services in California or potentially face substantial penalties and fines.

We have two locations in California and were required to pay two separate licensing fees and complete the required complicated and time consuming registration paperwork and ongoing documentation requirements for both locations. That all was accomplished before January 1, 2016 and each of our California offices are licensed HCOs allowing us to provide non-medical home care services.

We provide our care services to our clients through our caregiver aide employees. Caregiver aides providing in-home care services are now termed by the State as Home Care Aides (HCAs). In order to work for a HCO, caregiver aides must pay a fee to register as a HCA with the newly formed Caregiver Background Check Bureau (CBCB) and pass their background check. The CBCB oversees background checks for caregivers affiliated with a HCO.

In order for Home Care Aides to work for and be affiliated with a licensed HCO, they must register with the CBCB, provide finger prints and pass their background check, be on the CBCB’s online registry, complete at least five hours of annual training, and pass a current TB test.

California Overtime Changes Effecting Caregivers

On January 1, 2015, the Domestic Worker Bill of Rights (AB 241) took effect. This bill established new laws that regulates the number of consecutive hours in-home caregivers can work and requires overtime pay. Prior to this bill being passed, due to the nature of the services caregivers perform in the home, our caregivers were exempted from all overtime provisions. The new law requires caregivers to receive overtime pay at 1.5 times their regular rate of pay for any hours worked in excess of nine (9) hours in a day or in excess of forty-five (40) hours in a work week.

This bill was supposed to be a temporary trial and was to end in 2017 however Governor Brown signed SB 1015 that took effect on January 1, 2017, SB 1015 eliminating the original sunset date on AB 241. SB 1015 makes it permanent law that caregivers receive overtime pay at 1.5 times their regular rate of pay for any hours worked in excess of nine (9) hours in a day or in excess of 45 hours in a work week.

The consequences of eliminating the overtime exemption for caregivers is that it drives up the cost of care to the consumers of in-home care services because of the overtime pay requirement and associated payroll tax increase. These costs have to be passed on to consumers resulting in higher costs for in-home care services.

California Minimum Wage Changes Effecting Caregivers

Governor Brown has signed into law legislation that increases the minimum wage in California every year until 2023 when it gets to $15.00 an hour. These increases in wages have nothing to do with job performance but rather have everything to do with entitlements.

The increase in minimum wages each year has and will result in an increase in the cost of in-home care services to consumers each year. An increase in the hourly wages costs a company substantially more money to be in business. Here are the reasons why:

Healthy Workplace Healthy Family Act of 2014 (AB 1522)

This new law mandates that caregiver employees who, on or after July 1, 2015, works in California for 30 or more days within a year from the beginning of employment, is entitled to paid sick leave. Caregiver employees can use 24 hours or three days of accrued sick leave in one year. Accrued paid sick leave may be carried over to the next but it is be capped at 48 hours or six days.

The use of sick leave is very liberal for the employee caregiver and essentially an employer cannot deny a sick leave request regardless even if it is short notice or right before they are scheduled to work a shift.

With the passage and implementation of this law came mandatory posting, reporting and documentation requirements that are complicated and costly to implement and maintain. In addition, this is a significant additional new and ongoing cost to in-home care agencies. These additional new costs get factored into the
cost of services to consumers, yet again causing the prices for home care services to increase.