Agencies have until October 13, 2015 to fully comply with The Court of Appeals for the District of Columbia Circuit Court decision to side with the Department of Labor (DOL). The DOL has successfully argued and won the latest round in determining which home health agency and home care agency staff must be paid according to the Fair Labor Standards Act (FLSA).
This means that your agency’s para-professional staff and professional staff must be paid overtime for hours that exceed 40 within a one week period and be paid minimum wage. So, all of your home health aides, your live-in staff, your nurses, your therapists – all hourly wage clinical staff must be paid overtime when they work over 40 hours! This has the potential to create a scheduling nightmare for many agencies who provide substantial in-home Medicaid waiver based services to patients.
The timing of this rule is somewhat cut and dry. Agencies have a grace period that extends 30 days after the October 13th expiration of any appeals. However, all legal experts and labor attorneys recommend that agencies not wait and begin to comply with the ruling now. While you do have flexibility, it is best advised to follow the 40 hour per week guidelines. With ICD-10 coming, the potential for overtime could be a devastating blow to some home health agencies.
Additionally, you can expect that the DOL will begin to perform random audits of home care agencies over the coming months, if an appeal is not launched. Agencies should be holding onto timesheets and time records for a minimum of three years after the pay period. Electronic timesheets and paper timesheets are both acceptable. Scheduling staff must also be made well aware of the 40 hour rule, as should payroll staff. This is going to need to be a joint effort by all members of the agency in order to remain compliant and not bankrupt your agency.
Home care had been protected from paying staff overtime by the DOL’s interpretation of the FLSA that dates back to the 1970s. However, in 2013, the DOL changed their opinion during the national wave against business, and determined home care staff should be paid overtime.
When this opinion changed, lawsuits were filed on behalf of the industry by The Home Care Association of America which is not NAHC – the National Association for Home Care and Hospice. The Home Care Association of America focuses more on private duty agencies and those that provide long term in-home care through Medicaid Waiver programs and state programs.