Home Care Workers Should Welcome Deregulation

In July, President Donald Trump and his administration proposed more than 60 rule changes designed to deregulate several industries, including mining, farming, and construction. These measures will have a noticeable impact on the American economy and Pennsylvania in particular. But one overlooked proposal hits closer to home.

The proposal, titled “Application of the Fair Labor Standards Act to Domestic Service,” would reverse a disastrous regulation instituted by former President Barack Obama that created more problems than it solved. This Obama-era regulation imposed minimum wage and overtime pay requirements on the home care industry, even though home care workers—those who provide routine assistance to the disabled or elderly—often have nontraditional arrangements with those for whom they care. In fact, some are close family members or live-in caretakers.

Ostensibly, Obama’s regulation would mean more money for underpaid workers and fewer shortages in home care workers. But Obama’s regulation was equally political maneuvering: It would help Obama’s union allies—his biggest political supporters—monetize their home care unionization efforts.

In fact, the previous year, Obama’s Department of Health and Human Services changed the Medicaid payment rules, allowing a portion of home care workers’ Medicaid payments to be “reassigned” to unions. Subsequently, unions could take their dues directly from workers’ paychecks. Any increases in home care workers’ pay would mean a corresponding percentage flowing straight to union bank accounts.

Unfortunately, extending minimum wage and overtime requirements to the home care industry did more harm than good.

The Government Accountability Office (GAO) found that, in the years following the application of minimum wage and overtime requirements, Medicaid and private home care agencies cut workers’ hours due to the prohibitive cost of paying overtime. With this shortage of overtime staff, agencies struggled to hire enough new workers to properly provide 24-hour care to patients, leading some agencies to discontinue 24-hour or live-in care entirely. This meant that disabled and elderly patients ended up relying on volunteers and family members to provide continued, after-hours services.

At the same time, home care workers’ hourly wage “did not significantly increase following implementation . . .  when compared to those in occupations with similar entry requirements,” according to the GAO. Many home care workers were forced to “moonlight,” with some taking on home care work through another agency.

No surprise, the home care workforce—which had added 380,000 workers from 2008 to 2013—would attract just 200,000 workers from 2013 to 2019, even as the number of those qualified to receive home care accelerated. According to a 2024 survey, nearly four in every five home care workers quit within their first 100 days on the job, an increase of over 12 percent since 2022.

Shortages are an acute problem in Pennsylvania. Every month, 112,500 home care shifts go unfilled, according to the Pennsylvania Home Care Association (PHCA). The Paraprofessional Healthcare Institute projects that Pennsylvania’s home care workforce will have to increase by nearly 30,000 to meet rising demand.

Harrisburg’s heavy spenders—including the PHCA and the labor unions representing home care workers—are all advocating for more money. But each of them accepted large grants to “train” home care workers instead of upping their wages. Meanwhile, union executives continue to siphon money from home care workers’ paychecks.

While it may be a worthy investment to increase home care workers’ wages, it also makes sense to revisit the destructive policy choices made by the Obama administration that made it unlikely home care workers will benefit from any such increases. President Trump’s efforts to deregulate the industry are a good place to start.